Chapter 10 – Contract Performance, Breach, and Remedies
Practical Internet Exercise 10-1:
Legal Perspective—Anticipatory Repudiation
Instructions: A classic case concerning anticipatory repudiation of a contract is
Hochster v. De La Tour, an English case decided in 1853. The listed URL will
take you to a page on the Web site of Santa Clara University School of Law that
presents this case. Read through the case and then answer Questions 1–4.
Visit URL:
Hochster v. De La Tour Case Opinion
http://law.scu.edu/FacWebPage/Neustadter/contractsebook/main/cases/Hochster
.html
Questions and Answers
Answer the following questions in the fields below.
Question 1: What events led to this lawsuit? Who were the parties? What was
the question before the court?
Question 2: How did the court describe the parties’ relationship in this case?
What examples of similar relationships did the court discuss?
Question 3: Generally, why did the court reason that the plaintiff should be able
to treat the defendant’s action as a breach of contract and sue the defendant
immediately, rather than wait until the date on which performance was to have
begun?
Question 4: Why did the court discuss the case of Planchè v. Colburn? What
were the facts in that case, and what did the court hold?
Practical Internet Exercise 10-2:
Management Perspective—The Duty to Mitigate
Instructions: When an employee is terminated, the employee has a duty to
mitigate his or her damages. Workplace Fairness, a non-profit advocate for
employees' rights, hosts a Web page dedicated to mitigation.
Go to the first URL below and read through the information on this page, then
answer Questions 1–4.
The duty to mitigate also applies to insurance claimants such as many Gulf
Coast residents affected by hurricanes, particularly Hurricane Katrina in 2005. Go
to the second URL below, read the section, "Make temporary repairs," then
answer Questions 5 and 6.
Visit URLs:
Workplace Fairness-Mitigation Information
http://www.workplacefairness.org/index.php?page=mitigation
Make Temporary Repairs Information
http://www.chron.com/disp/story.mpl/special/05/katrina/3357661.html
Questions and Answers:
Answer the following questions in the fields below.
Question 1: How does Workplace Fairness recommend that a terminated
employee show that the employee tried to find another job to mitigate damages?
Question 2: In order to mitigate damages, must a terminated employee accept
any job that is offered to them? Explain.
Question 3: Generally, is unemployment compensation included in the
calculation of earnings to offset an award of back pay?
Question 4: Are there any exceptions to the "duty to mitigate" regarding an
employee's loss of work? Explain.
Question 5: What are some examples of how homeowners should mitigate their
storm-related losses?
Question 6: What information does the attorney Garfinkel recommend that
claimants record on a calendar?
Practical Internet Exercise 10-3:
Management Perspective—Commercial Impracticability
Instructions: Sometimes, when a long-term contract is formed, there exists
unforeseeable factors that may later make performance of the contract by one
party much more expensive than originally perceived. In recent years, the prices
of steel, copper, and crude oil have increased substantially, which have raised
this issue of commercial impracticability for some manufacturers and contractors.
At the URL listed below, the business-oriented law firm of Raymond & Prokop,
P.C. presents an article about impracticability and other legal defenses to this
dilemma, as faced by Detroit manufacturers. Click on the URL, review the article,
and answer Questions 1–3.
Visit URL:
Commercial Impracticability Article
http://www.thefreelibrary.com/Suppliers:+when+a+longterm+contract+is+more+of
+an+anchor+than+a...-a0133247231
Questions and Answers
Answer the following questions in the fields below.
Question 1: In Michigan, does a rise in expenses due to the increased price of
raw materials or the increased cost of construction typically qualify as
impracticability? Why or why not?
Question 2: To successfully use the defense of commercial impracticability, a
supplier must demonstrate that an increase in the price of raw materials is
related to what?
Question 3: What does Michigan common law call impracticability?