Question 1

For contracts concerning the purchase of land, once payment in full in accordance with the terms of the contract has been offered by the purchaser, if not provided in turn by the vendor with a deed to the property, the purchaser may

Accepted Answer

A)   bring an action for tender.
B)   bring an action for termination.
C)   bring an action for specific performance.
D)   bring an action on the condition subsequent.
E)   bring an action for delivery of legal tender. C

Question 2

Imperfect tender, also referred to as imperfect performance, does not represent a breach of contract.

Accepted Answer

A) True 
 B)False  False

Question 3

Bronson signs up to join the army because the advertisements make it look like summer camp. Later, he changes his mind and shoots himself in the foot, so he won't have to go. This does not frustrate the contract, though the contract may be avoidable on other grounds.

Accepted Answer

A) True 
 B)False  True

Question 4

Damian and Raja agree in writing that Raja will buy Damian's cottage. On the date set for closing the sale, it is up to Raja to come to Damian to make payment of the purchase price, unless the contract says otherwise.

Accepted Answer

A) True 
 B)False

Question 5

Carson, a fruit wholesaler, delivered bananas to Phil's Fruit Market. A sizeable portion of the truckload was of questionable quality, but no one at Phil's Fruit Market had objected to delivery. After a falling out over another contract a year later, Phil's Fruit Market sued Carson over the banana shipment. Of the following, Carson's best defence would be:

Accepted Answer

A)   merger.
B)   waiver.
C)   laches.
D)   novation.
E)   extinguishment.

Question 6

Damian and Raja agree in writing that Raja will buy Damian's cottage. If Raja changes her mind and refuses to buy the cottage, Damian can get specific performance provided he can prove that he tried to transfer the title deed to the property on the closing date and Raja would not accept it.

Accepted Answer

A) True 
 B)False

Question 7

Lucas offered to purchase Baker's snowmobile if he could arrange a loan with the bank for the funds. Lucas and Baker signed a written purchase agreement which did not mention the fact that Lucas did not have the necessary funds in his possession. If the bank refused to lend Lucas the money, the contract would be enforceable against Lucas.

Accepted Answer

A) True 
 B)False

Question 8

Joe sold a barn full of hay to Sheila but, before Sheila could transfer it to her own barn, a hurricane blew the roof off Joe's barn, and that part of the hay that did not blow away was ruined by the torrential rains. The contract is frustrated.

Accepted Answer

A) True 
 B)False

Question 9

Kirk entered into a contract with Yemmi to haul gravel in his large tandem truck from Yemmi's gravel pit to a building site some five kilometres distant, at $60 per load. Before Kirk was to begin performance, his truck was destroyed in a serious traffic accident. If Kirk owned a fleet of trucks, and Kirk had a number of spare trucks, the doctrine of frustration would not apply to the case, and Kirk would be obliged to perform the contract.

Accepted Answer

A) True 
 B)False

Question 10

Joe's Jazz Quintet contracted with Larry's Lounge to provide music in the lounge each evening for a two-week period. The terms of the contract provided for payment of a weekly fee of $5,000.00 for Joe's services. During the course of the first week Larry sold the lounge to a group of investors who decided to convert it to a country and western line dancing bar. The new owners immediately terminated Joe's contract but paid the quintet the full weekly fee for one week even though only three performances had taken place.
Joe's group had the opportunity to move on to its next booking early and did so, commencing performances the next evening. At the end of their touring season, some ten months later, Joe and his musicians reflected on business matters that had transpired over the season. They realized that they had had to forgo one week's pay of $5,000 at Larry's Lounge and, even though they started their next job early, it had only paid $3,000 for the week. Moreover, Joe felt that it did not help the reputation of the band to essentially be "fired" from a job. Joe and his friends decided to get some advice about taking legal action against Larry or the new owners of the lounge for the damages they had suffered as a result of the termination of their contract. Identify the issues that their legal counsel would discuss with them about their claim. What argument(s), if any, would Larry or the investors raise in response to Joe's action?

Accepted Answer

The answer of Joe's Jazz Quintet contracted with Larry's Lounge...

Question 11

Shamira offered to purchase Brendan's automobile for $3,050 cash, with Brendan to deliver the vehicle the next Wednesday, at which time Shamira would pay the $3,050. On the Wednesday, when Brendan did not deliver, Shamira went to Brendan's home, and found him in his garden. Shamira offered Brendan the money, but Brendan refused, saying that he had changed his mind, and did not wish to sell his automobile. If Shamira had offered Brendan exactly $3,050 in cash, she had made a valid tender of payment.

Accepted Answer

A) True 
 B)False

Question 12

On April 13, the Barclays signed an agreement to purchase certain property owned by the Taylors for the sum of $15,500. The purchase and sale agreement did not specify a form of payment except that the purchasers were to pay a deposit of $500 in cash and the balance on closing. The date of closing was set out in the agreement as July 1^st. The agreement also contained the following provision: "This sale is conditional for a period of 15 days from the date of acceptance upon the Purchaser being able to obtain a first mortgage in the amount of ten thousand dollars ($10,000), otherwise, this agreement shall be null and void and all deposit monies shall be returned to the Purchaser without interest or penalty. This sale is also conditional for a period of 15 days from the date of acceptance upon the Purchaser being able to secure a second mortgage in the amount of $2,500 for a period of five (5) years, otherwise, this agreement shall be null and void and all deposit monies shall be returned to the Purchaser without interest or penalty." The Barclays were able to arrange for a first mortgage of $12,000 and, on April 28^th, a notice in the following form was delivered to the Taylors: "This is to notify you that the condition specified in the agreement of purchase and sale between the Vendors and Purchasers has been met. The transaction will therefore close as per the agreement." On July 1^st the Barclays presented a certified cheque to the Taylors in the amount of $15,000. The Taylors, however, refused to deliver the deed to the Barclays on the grounds that the condition in the purchase and sale agreement had not been complied with. The Barclays then instituted legal action against the Taylors. Discuss the nature of this action and the defences, if any, which may be raised. Render a decision. D.L.R. (3d) 693, this case explores the issues of tender, condition precedent, specific performance and, tangentially, waiver. The purchasers will attempt to succeed in an action for specific performance. Having offered payment in the full amount of the contract and exhibiting their readiness and willingness to complete the transaction they will argue that the vendors must deliver the land. Also, the conditions in the agreement for the benefit of the purchasers were met to their satisfaction. Having notified the vendors to this effect, the purchasers argue that performance is now essential to discharge their agreement. The vendors are entitled to raise defences with respect to the tender of payment and the condition precedent. The form of payment was not specified in the agreement with the exception of the deposit in cash. The implied form is, then, cash in the exact amount. The purchasers, by tendering a certified cheque, albeit in the exact amount, have failed to properly tender payment and the vendors may properly refuse to accept the payment and deliver up the land. Moreover, the agreement set out a sequence of events in the form of conditions precedent that must be met prior to the agreement becoming enforceable. The conditions stipulated the occurrence of two specific events but failed to state that either party has the right to waive the condition in order to establish the contractual rights and to enforce the agreement on the other party. Essentially, waiver or the right to waiver, must be mutually agreed upon by the parties in order to establish consideration for the promise. Therefore, one party alone may not waive the condition upon which the right to enforcement of the contract rests. On the grounds that the conditions were not waived, the vendors argue that they cannot be forced to deliver up land under a contract which has not come into effect. The condition as specified in the agreement was never met and, thus, both parties are discharged from performance. The Ontario Court of Appeal found for the purchasers on the basis of facts concerning the nature of the condition precedent which are beyond the scope of the text discussion.

Accepted Answer

The answer of On April 13, the Barclays signed an...

Question 13

Shamira offered to purchase Brendan's automobile for $3,050 cash, with Brendan to deliver the vehicle the next Wednesday, at which time Shamira would pay the $3,050. On the Wednesday, when Brendan did not deliver, Shamira went to Brendan's home, and found him in his garden. Shamira offered Brendan the money, but Brendan refused, saying that he had changed his mind, and did not wish to sell his automobile. If Brendan refused the tender of the exact amount of money, Shamira would be entitled to take legal action against Brendan for breach of contract.

Accepted Answer

A) True 
 B)False

Question 14

Kirk entered into a contract with Yemmi to haul gravel in his large tandem truck from Yemmi's gravel pit to a building site some five kilometres distant, at $60 per load. Before Kirk was to begin performance, his truck was destroyed in a serious traffic accident. If Kirk deliberately destroyed his truck, Yemmi can insist that he perform the agreement or compensate Yemmi for any loss that might result from Kirk's non-performance.

Accepted Answer

A) True 
 B)False

Question 15

When does a waiver have to be in writing and under seal?

Accepted Answer

A)   If the original contract was required to be in writing pursuant to the Statute of Frauds.
B)   If the original contract was in writing due to the parol evidence rule.
C)   If both parties have partially performed the contract.
D)   If one party has partially formed the contract.
E)   If one party has fully performed the contract.

Question 16

Jamil, a prospective purchaser of real estate, visited his lawyer with three completely executed agreements of purchase and sale, each for a different piece of real estate. Each offer was conditional upon "the purchaser being able to obtain $50,000 financing to his satisfaction within ten days at a rate of interest not exceeding 10%, failing which this offer is void." Financing of this type was easily available, over the counter, from any local bank for a person of Jamil's financial circumstances. Discuss the position that Jamil has found himself in, particularly if he should obtain such financing, informing one purchaser of his intention to proceed, and the other two that he could not obtain funds.

Accepted Answer

The answer of Jamil, a prospective purchaser of real estate,...

Question 17

Gavin is in the business of local transport of goods, as well as running a rural bus service. He contracts for a delivery van from his local truck dealer, but before the dealer places the order with the manufacturer, Gavin amends the order to request the minibus model of the delivery van. Gavin and the dealer have created a new contract that replaces the prior one.

Accepted Answer

A) True 
 B)False

Question 18

Cecilia agreed to buy an antique Japanese sword from Andrew. After the contract is formed but before Andrew delivers the sword or Cecilia pays any money to him, the government passes a law that makes it a crime to buy a sword other than a fencing foil. Since the contract was made before the law was passed, it is not frustrated.

Accepted Answer

A) True 
 B)False

Question 19

John Stevenson, a plumber, had a contract to repair a slow leak in a toilet in Dr. Ibsen's medical clinic. Because it had to be done when no patients were there, John Stevenson agreed to come on a Saturday. However, when he got there, he found a notice on the door saying "Got a chance for a free trip to Hawaii. Come next Saturday at the same time. Thanks. Dr. Ibsen." John Stevenson did not turn up the next Saturday and, when Dr. Ibsen called to find out why, John Stevenson said he had promised to take his wife shopping that day, and he doubted if he would be able to find the time in the future.

Accepted Answer

A)   Dr. Ibsen breached the contract on the first Saturday.
B)   John Stevenson breached the contract on the second Saturday.
C)   Neither man has breached the contract; it is simply suspended.
D)   The contract was not breached since it was frustrated on the first Saturday because Dr. Ibsen could not be there.
E)   Dr. Ibsen breached the contract on the first Saturday and John Stevenson breached the contract on the second Saturday.

Question 20

Shamira offered to purchase Brendan's automobile for $3,050 cash, with Brendan to deliver the vehicle the next Wednesday, at which time Shamira would pay the $3,050. On the Wednesday, when Brendan did not deliver, Shamira went to Brendan's home, and found him in his garden. Shamira offered Brendan the money, but Brendan refused, saying that he had changed his mind, and did not wish to sell his automobile. If Shamira had in her possession three $1,000 bills, and one $100 bill, her tender would be invalid, even though she had cash in excess of the amount requested.

Accepted Answer

A) True 
 B)False

Exam 13: Performance of Contractual Obligations

For contracts concerning the purchase of land, once payment in full in accordance with the terms of the contract has been offered by the purchaser, if not provided in turn by the vendor with a deed to the property, the purchaser may

Imperfect tender, also referred to as imperfect performance, does not represent a breach of contract.

Bronson signs up to join the army because the advertisements make it look like summer camp. Later, he changes his mind and shoots himself in the foot, so he won't have to go. This does not frustrate the contract, though the contract may be avoidable on other grounds.

Damian and Raja agree in writing that Raja will buy Damian's cottage. On the date set for closing the sale, it is up to Raja to come to Damian to make payment of the purchase price, unless the contract says otherwise.

Damian and Raja agree in writing that Raja will buy Damian's cottage. If Raja changes her mind and refuses to buy the cottage, Damian can get specific performance provided he can prove that he tried to transfer the title deed to the property on the closing date and Raja would not accept it.

Joe sold a barn full of hay to Sheila but, before Sheila could transfer it to her own barn, a hurricane blew the roof off Joe's barn, and that part of the hay that did not blow away was ruined by the torrential rains. The contract is frustrated.

When does a waiver have to be in writing and under seal?