Completing

1
Completing Discharging a Contract
2
Discharging a Contract

• Once the terms of a contract have been decided
  through an offer and acceptance using definite
  terms of consideration, the contract must be
  completed.
• Both parties need to fulfill their part of the
  deal to discharge the contract.

3
Methods of Discharge

• There are four ways to discharge a contract
• Performance
• Mutual agreement
• Impossibility of performance
• Breach of contract

4
Performance

• The most common way to discharge a contract is
  through performance.
• A contract is discharged through performance when
  each part fulfills their duty as outlined in the
  contract.

5
Mutual Agreement

• Contracts do not have to be completed in order to
  be discharged.
• Both parties may choose to release the other of
  their obligations through an agreement to cancel
  the contract.

6
Impossibility of Performance

• In some cases the impossibility of a party to
  complete the contract as originally decided
  terminates the contract without penalty.
• For example, if a taxi driver makes a contract
  promising that they will get you to the airport
  on time then gets a flat tire, they are not
  liable for their inability to complete the
  contract.

7
Breach of Contract

• A breach of contract occurs when one party in the
  contract does not fulfill their part of the
  contract.
• There are two possible ways to breach a contract
• Breach of condition
• Breach of warranty

8
Breach of Contract

• Breach of condition occurs if a specific and
  fundamental condition of the contract is not
  completed.
• Breach of warranty occurs when a minor condition
  is not completed, which is not a major part of
  the original contract.

9
Breach of Contract

• The injured party in a breach of contract may
  seek compensation to control any problems that
  may arise as a result of the breach of contract.
• This is known as a mitigation of losses.
• If money is not enough for the mitigation of
  losses then the injured party may ask the court
  for specific performance, which is an order for
  the offending party to complete their part of the
  contract.

10
Employment as a Contract

• Read sections 20.2 and 20.3 in your text, and
  answer the RYR questions on p524, pp533-4