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Contracts • Excuse of Non-Performance
K#128
Legal Definition
In a divisible contract, the breaching party can recover for substantial performance of a divisible part, even though they breached the entire contract. Look to whether the price is stated as a lump sum or on a per performance basis.
Plain English Explanation
Many contracts are not divisible. For example, if I offer to pay you $40 to paint my house and you only paint 1 wall before getting bored and walking off, I don't need to calculate the value of you painting that single wall vs. the value of you painting my entire house. However, if I offer to pay you $40 to paint a room, and you only paint 1 of the 4 walls, there may be an argument that the contract is divisible and that each wall of equal size is worth $10.
Hypothetical
Hypo 1: Bob builds house. Sam tells Bob he will pay him $1,000,000 to develop his land into a neighborhood of 10 $100,000 houses. After years of work, Bob has some health issues and only completes 6 of the 10 houses. Sam says, "Sorry, we agreed to 10 houses. You get nothing." Result: This is the perfect example of a divisible contract. Yes, the agreement technically requires Bob to build 10 houses, however, allowing Sam to keep the 6 completed houses would be unjust enrichment. Here, the court would allow Bob to sue Sam for $600,000 for the 6 $100,000 houses he completed.
Visual Aids
Related Concepts
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