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Camille L. Scott February 28, 2013

Contracts Outlining Problem Assignment

I. Issue: Was the defendant entitled to cease performance and refuse to do further work or was he in breach of contract when he ceased contracted work due to a disagreement regarding the contract.

II. Rule:

* The general rule is work before pay §234(2) of the Second Restatement of contracts says unless to be rendered simultaneously where the performance of 1 party requires a longer period of time to perform, that parties’ performance is due at an earlier time than the other party, unless the language or the circumstances indicate otherwise.

* §237 The effect of Non-occurrence of a condition is that under this section a material failure of performance:

* Prevents performance of the remaining duty to become due

* Discharges the duty if it has not been cured in a specific timeframe.

* Material failure acts as the non-occurrence of a condition.

* Determining the materiality of the failure through analysis in §241 factors or determining if breach is material.

a. How much benefit is P deprived of?

* Substantial b/c could not proceed with a significant amount of the contracted work w/o excavation

b. Can the P be adequately compensated for loss?

* Yes by performance or payment for difference of new contractor

c. The extent to which the party failing to perform will suffer forfeiture.

* His forfeiture is mitigated by progress payment of $100k already received

d. The likelihood breaching party will cure the breach

* Not likely he ceased work

e. The extent to which the breaching party acted in good faith and fair dealing,

* He did not act in good faith it could be looked upon as breach

III. Application:

* Analytical steps that lead to the determination about the overall nature of the language:

* Is it a promise or condition or both a promissory condition?

* Elements...