Contracts 7

o “ True Warranty ”:  a term that, if breached, will never deprive the innocent party of substantially the whole of the benefit they were to receive from the contract  if breach of a true warranty  innocent party is not permitted to stop performing o they must continue to perform, but they may also sue for the breach as they perform o “ Innominate or Intermediary Term ”: = a repudiatory breach ** CANNOT be a priori classified – these are the ‘hard cases’ **  for such terms we look at the events created by the breach and examine whether the particular event has, on the facts, acted to deprive the party not at fault of substantially the whole benefit which it was intended that should be received from the contract  innocent party can affirm or disaffirm the contract if breach of innominate/true condition o if affirm  they must then keep performing but can also sue for the breach while performing o if disaffirm  innocent party can choose to explicitly inform the breaching party of their intention to no longer continue with the contract “because of your repudiatory breach, I no longer wish to be bound by this contract and so I will stop performing.”  Innocent party can then stop performing, inform the other party of the disaffirmation, and sue for breach  if breach of innominate/true warranty  innocent party is not permitted to stop performing o they must continue to perform, but they may also sue for the breach as they perform  Consequences of the different Types of Breach : o Breach of an innominate or true condition  repudiatory breach  The innocent party can elect to affirm or disaffirm the contract o Affirming: party is stating (either explicitly or through conduct) that despite the breach, they wish to keep on going with the contract  Innocent party must then keep performing but can also sue for the breach while performing