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Lecture

BU231 Lecture Notes - Novation, Lightning


Department
Business
Course Code
BU231
Professor
Valerie Irie

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Discharge of Contracts:
-end of the contract
-cancellation
-agree to not perform
-Waiver: both parties cannot perform fully
-consideration must be present
-Substituted: novation
-let’s agree cancel old contract, come up with new one
-term in contract allows parties to discharge
-condition precedent: event must occur before it can take effect
-if event doesn’t happen, contract discharged
-real estate, mortgage financing, my selling my house, etc….
-didn’t have option be stuck there
-giving notice can discharge yourself
-entered into mortgage interest term 5 year period, not allowed trapped
-options to terminate, 3 months interest
-states law excuses contract, when person is frustrated, cannot allow person to perform
Doctrine of Frustration:
-if before mistake in subject matter of contract
-frustrating events are tornadoes, hurricanes, lightning, war
-outside control/unforeseen
-makes it radically different
-no point in continuing contract
-both parties discharged
-problem is what if one party already started performing, now somebody has to suffer loss
-polish company and British company
-polish pay sum upfront, British delivered good
-Germany invaded Poland, and Britain declared war on Germany
-court decided if no benefit at all to party who paid money, got all money back
-no matter how small benefit other party could keep all money
-all or nothing
-effort be kind, court created rule caused issues
-only applies to sale of goods
-has own rules regarding frustration
-common law: fibrosa
-in Ontario overruled by statue
-risk of maintaining goods is with seller
-transporting goods to you
-if vendor has risk of them still
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