Chapter 13. Ending a Contract

Contracts may be terminated by Performance: 

  • Time- if time is not mentioned in a contract the court will consider completion in a reasonable time suitable. if time is essential to the contract, the court will limit the amount of reasonable time.  time limit is mentioned in a contract and time is essential, the courts may allow additional or reasonable time for completion. 
  • Satisfaction- the law requires that services are to be performed at a satisfactory matter. if a dispute arise based on satisfaction of service, the court will; use reasonable person test. contract which state “to the other parties satisfaction  must perform to the satisfaction of the other party.
  • Substantial- general rule : “most instances if a contract is not fully completed or not to complete performance, the party suing will win”. The doctrine of substantial performance states that if a contract is slightly less than complete and the major requirements of the contract have been fulfilled the party performing can recover agreed upon the amount of contract.
  • Tender- terms of a contract can be fulfilled by performing and paying. an offer to do what has been agreed upon a contract. Tender of performance fulfilling an act to a contract. Tender of payment fulfilling a payment to a contract. if tender of performance is rejected- that party will be excused from fulfilling the fulfilling.


  • Mutant release- both parties to a contract mutually agree to end the contract, thus each party agrees to give up their consideration.
  • Accord and Satisfaction– one party ends a contract due to unforeseen circumstances (money problems). The one party offers new consideration. The one party offers new consideration. The second parties acceptance is the accord and the carrying out of the promise is the satisfaction

Impossibility of performance:

  • Death or illness- unless party assigns contract to another.
  • Destruction of exact subject matter

Operations of Law:

  • Wrongful Alteration: any intentional, fraudulent of a contract will terminate the contract under law.
  • Statute of Limitations: the legal time allow for an individual to bring a suit against a contract. After the time limit has expired, the contract is considered discharged or terminated and legal action against the contract is not possible.
  • Individual state statutes specify the time limit to force a contract. Generally an individual has four years to file a law suit.
  • Bankruptcy: federal laws not state driven. filing for bankruptcy prevents any individual from being sued failure to pay. English common law would sentence an individual to prison failure to pay. Certain debts can not be discharged under bankruptcy laws such as taxes, alimony, and education.

Language of the Law

1.rasonable time
2. substantial performance
3. legal tender
4. mutual release
5. tender
6. statute of limitations
7. discharged
8. performance
9. accord and satisfaction
10. complete performance

1.  The court will allow more time if there is reasonable time and if the time is mentioned in the contract.
2. The contract must clearly say “time of the essesence.”
3. The court will consider completion in reasonable time.
4. Reasonable person test.
5. Slightly less than full performance.
6. If the contract cannot be performed.
7. The time period in which someone may sue someone else.


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