Discharge by Performance key themes - To discharge obligations, performance must be 'precise and exact'. o Issue: When is performance 'precise and exact'? - Distinction between Primary and Secondary Obligations o Primary obligations are standalone obligations that arise immediately in the performance of a contract. Whether by the terms or by implication by the law. Eg, obligation to produce goods, deliver good, provide specific services or provide payment for those. o Secondary obligations are obligations triggered as a consequence of one party's breach and are intended to deal with the effects of the breach. Eg payment of compensation for defective goods. - Once parties have done all they are bound to do, all primary obligations will cease. o Key issue: What is satisfactory performance? - Entire or divisible contracts? o Whole contracts are contracts where service is performed as a single whole. o Divisible contracts are those that can be broken down into separate parts and each generates a potential claim for payment Nature of performance - General rule is 'precise and exact' performance. - Strict interpretation, - Historically, courts have taken a strict approach to this requirement. eg Re Moore & Co and Landauer & Co (1921) - Contract for the delivery of 3000 tins of canned fruits specified that tins were to be packed in cases of 30 tins. Seller packed in cases of 24 tins. - Held: This does not constitute satisfactory performance. Arcos Ltd v EA Ronaasen & Sons (1933) - Contract specified that the timber staves be half an inch thick, but the consignment were mainly of staves that were a little off than the specification. - Held: Goods did not meet contract specification. Buyer was entitled to reject goods. - Court looked at the Sale of Goods Act 1893 (now sec 13)- implied obligation for goods to meet its description. - However, in more recent years, courts have moved to a more moderate approach, refusing to accept unreasonable rejection of goods for failure to meet all contract description. Reardon Smith Lines Ltd v Hansen Tangen (1976) - HOL rejected a claim by the purchaser of a ship to reject delivery of the ship because it was manufactured in a different yard than that which was specified in the contract. Ship had in all other ways, met the purchaser's requirement. - In practice, much will depend on the terms of the contract. Eg
Union Eagle Ltd v Golden Achievement Ltd (1997) - Contract provided for the sale of a flat, and time was specified to be a condition. Payment was to be tendered by 5pm on a specified date, but payment was tendered at 5:10pm. - Privy council held seller was entitled to repudiate the contract. - Care needs to be taken as to the terms of the contract Partial performance of services - In general, same approach will apply to provision of services. - Only complete performance gives rise to an entitlement to payment. - But with services, it is possible that the provider