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Comparisons of Three Types of Contract Performance

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There are 3 types of contract performance: complete, substantial and material breach. Describe the differences (and similarities) among the three, and explain some of the legal ramifications for one or more of these types of performances. (For example, what happens if one party performs completely but the other party performs only substantially?) Give examples from outside readings or experiences in your career or personal business life.

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The solution describes the three types of contract performance: complete, substantial, and material breach. It provides background information for the student to do a comparison assignment of these three types of contracts.

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Complete: One party completely refuses to deliver on any part of the agreed upon undertaking with another party.

Substantial: A party who fulfills most of what is agreed upon in a contract with another party, however, the party omits, refuses, or fails to fulfill the remaining conditions of the contract. A Substantial breach will bind the aggrieved party to the conditions of the contract only for the conditions already fulfilled.

Material: The failure to perform under the conditions of the contract in a significant way that the failure destroys the value of the contract. A material breach will free the aggrieved party from fulfilling his duty to the contract. The aggrieved party has the legal right to sue for breach of contract.

In Complete Performance: The breaching party refuses to deliver on any part of the conditions of the contract without a legitimate legal excuse. The aggrieved party is deprived of all benefits or profits from the contract, therefore, does not have to meet his/her terms of the contract. In this case, the aggrieved party can declare the contract invalid and both parties return as if no ...

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