Question

John’s company signs a contract with the city of Monrovia, a town located in the U.S., to remove all of the gravel in a specific area. The city has performed their due diligence and has determined that the gravel should be removed and foresees no issues in doing so. After surveying the area himself and after accepting the contract, Hurricane Matthew comes into town and quickly leaves a large portion of the gravel underwater and removing it will cost the company 20 times more than was originally agreed to. The contract between John and the City has a provision stating that come Hell or Highwater, the contract is to be performed. Will there be any issues for John? For the City? Who should prevail if there is an issue of Non-performance? Refer to the theories in the chapter regarding Performance, Breach and Discharge.

Answer 1

Will there be any issues for John?

• No since the city is obligated to act as the contract indicated

For the City?

• Yes incase it does not act. John is obligated to sue the city

Who should prevail

• John

Is there is an issue of Non-performance? Refer to the theories in the chapter regarding Performance, Breach and Discharge.

• Yes, it is an issue of Non-performance.
• Non performance refers to failure of a party to fulfill the terms of a contract in which it may lead to a breach of contract and if the city does not fulfill its part it will lead to a breach of contract.
• Breach of contract by a party thereto is a method of discharge of a contract. It is because “breach” also brings to an end the obligations created by a contract on the part of each of the parties. Of course the aggrieved party i.e., the party not at fault can sue for damages for breach of contract as per law; but the contract as such stands terminated.