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Valparaiso Univ. Law School

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Thursday, March 23, 2006

Repudiation and Total Breach

Aaa_4 A curious rule of contract damages is that found in ยง 243(3) of the Restatement (Second) of Contracts:

Where at the time of the breach the only remaining duties of performance are those of the party in breach and are for the payment of money in installments not related to one another, his breach by non-performance as to less than the whole, whether or not accompanied or followed by a repudiation, does not give rise to a claim for damages for total breach.

What this is usually thought to mean is that if both parties still have obligations to perform, a repudiation by one allows the other party to sue immediately for total breach.  But if the non-breaching party has fully performed and the repudiating party's only remaining duties are to make installment payments, the breach isn't "total" and the other party can only sue after each payment, or all the payments, are missed.

Why the difference?  Tom W. Bell (Chapman) raises that question and tries to work through the potential policy arguments over at his blog, Agoraphilia.

[Frank Snyder]

http://lawprofessors.typepad.com/contractsprof_blog/2006/03/repudiation_and.html

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