An example essay answer for termination of contract for breach PDF

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An example essay or exam answer for termination of contract for breach...

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Contract termination for breach

[Exam heading] Issue

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The issue here is whether [party] can terminate the contract based on a breach of contract.

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First we must establish if an enforceable contract existed and we do this by looking at the elements of formation – offer, agreement, consideration, intent, capacity and then formalities – certainty

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If all of those are satisfied next we must look at the terms.

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Whether [party] can terminate depends on whether [the term] is classified as a condition, an intermediate term, or a warranty.

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The term is not implied by statute or expressly agreed by parties, and so it will be classified as a matter of construction. (If you have plenty of time then you could simply go through each of the parts below. If time is low, then quickly flag that you will only consider one, eg: “In this situation, the term will be considered a [classification]”. If you have any spare time after this, write one sentence on why the term isn’t the alternative classification)

[Exam heading] Condition

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A condition can be analysed by applying the essentiality test, created in Tramways, and approved of in the appeal to HCA and again in Bancks.

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The test considers the nature of the contract as a whole and asks: when the contract was formed, was the term was of ‘such importance’ that the aggrieved party would not have entered into the contract but for a ‘strict or a substantial performance of the promise’, and that this ought to have been apparent to the other party (Tramways)? (This is the “rule part of IRAC)

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In the current situation [discuss] (This is the “analysis” part of IRAC, so apply the law/rule above to the specific facts of the exam question)

(If you only have time to discuss this classification, put a “conclusion” title in the exam here, and state your conclusion. This could be as simple as: “In conclusion, [term] is likely to be considered a condition”. Then finish with the sentences below.

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A condition allows the aggrieved party to terminate the contract ‘upon any breach of the promise, however slight’ and the right to seek damages (Tramways).

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Accordingly, [party] [will/ will not] be able to terminate the contract.

[Exam heading] Intermediate term

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An intermediate term is classified according to the test in Hongkong Fir, recognised in Ankar and approved in Koompahtoo. The test asks whether a breach will deprive a party of ‘substantially the whole benefit which it was the intention of the parties… that he should obtain’.

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Bunge held that an intermediate term must be able to be breached in a number of ways.

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In this situation [discuss]

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A breach of an intermediate term will allow [party] to seek damages, but will only allow termination if the breach was serious.

[Exam heading] Warranty

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A warranty is a term that is subsidiary to the main contract, and a breach will only allow damages to be claimed.

[Exam heading] Conclusion

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In conclusion, [term] would be considered to be a [classification], and [party] would/would not be able to terminate. (Put your conclusion here if the question requires you to go through each classification)

(At the bottom of each script section, I include a list of all cases covered in your reading. A sentence (or two at most) can be helpful to jog your memory in an exam, but only include a short note on what is relevant to the script section) Tramways Advertising Pty Ltd v Luna Park Arcos v Ronaasen Schuler v Wickman Machine tools Associated Newspapers Ltd v Bancks Hongkong Fir Shipping Co Ltd v Kawasaki Kisen Kaisha Ankar Pty Ltd v National Westminster Finance Koomphahtoo Local Aboriginal Land Council v Sanpine...