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Contracts • Performance Under Common Law
K#106
Legal Definition
Under common law, parties have the basic duty to substantially perform all that is required under the contract.
Plain English Explanation
This is one of the differences between common law and UCC that is frequently tested.
Put simply, under common law (i.e., any contracts involving services and things that are not goods), parties to a contract merely have a duty to substantially perform what is required under the contract. In other words, 100% conformity to the contract isn't required in order to avoid a claim of breach. What is "substantial performance"? That's for you to argue on the exam.
In contrast, the UCC (i.e., all contracts for the sale or purchase of goods) requires perfect tender, which means the conditions of the goods must be exactly as promised in the contract.
Put simply, under common law (i.e., any contracts involving services and things that are not goods), parties to a contract merely have a duty to substantially perform what is required under the contract. In other words, 100% conformity to the contract isn't required in order to avoid a claim of breach. What is "substantial performance"? That's for you to argue on the exam.
In contrast, the UCC (i.e., all contracts for the sale or purchase of goods) requires perfect tender, which means the conditions of the goods must be exactly as promised in the contract.
Hypothetical
Hypo 1: Sam hires Bob to build a house. Sam specifically asks that Bob uses Super-Brand Pipes in the house. Sam explicitly puts this requirement in the contract. Bob agrees and begins building the house. After the house is built, Sam notices a box that says "Great-Brand Pipes." Sam discovers that Bob did not use Super-Brand Pipes, as the contract required. Great-Brand Pipes are the same quality and material as Super-Brand Pipes, and they differ only in the brand name. Sam sues Bob to force him to replace the pipes. Result: Though Bob didn't perfectly perform under the contract, he did substantially perform. The pipes are the same quality, grade, and material as the Great-Brand Pipes and, to swap them out would require Bob to rip apart walls and incur substantial cost. Yes, it would have been nice if Bob got permission to use a different brand after agreeing to use a specific brand, but the court believes it would be overly punitive to force Bob to start over again when the problem is mostly in Sam's loyalty to a brand name.
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