Legal Dispute Between Walker & Co. and Harrison: Contract Breach Analysis
In the legal dispute between Walker & Co. and Harrison regarding a breached contract over a billboard, Harrison claimed that Walker failed to maintain the sign, justifying contract termination. However, Walker's actions to remedy the breach and the criteria for material breach were evaluated by the court. The potential for expectation damages, restitution for unpaid rent, and the adequacy of compensation for both parties were also considered.
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Walker and Co. v. Harrison Richard Warner
The Breach Harrison leased a billboard form Walker and Co. The breach: Walker was to maintain the sign, but Shortly after the sign was installed, someone hit it with a tomato. Rust, also, was visible on the chrome, complained defendants, and in its corners were little spider cobwebs. In addition, there were some children's sayings written down in here.
Harrisons Letter YOU HAVE CONTINUALLY VOIDED OUR RENTAL CONTRACT BY NOT MAINTAINING SIGNS AS AGREED AS WE NO LONGER HAVE A CONTRACT WITH YOU DO NOT EXPECT ANY FURTHER REMUNERATION. Is Harrison right that there is no longer any contract? (a) Yes (b) No (c) No, unless the failure to maintain the sign was a material breach.
Criteria for Material Breach 1. the extent to which the failure to perform deprives the injured party of the benefit he or she reasonably expected to obtain under the contract; 2. the extent to which the injured party can be adequately compensated for the deprivation of the benefit; 3. the extent to which the party failing to perform will suffer a forfeiture; 4. the likelihood that the party failing to perform will cure the failure; 5. the extent to which party failing to perform acted in accord with standards of good faith and fair dealing.
Cure In Walker Cure = a breach followed by acts that eliminate (= cure) the breach. The court: about a week after defendant Herbert Harrison sent his telegram of repudiation Walker sent out a crew and took care of things. We are constrained to agree with the trial court that [the delay in cleaning the sign] was not of such materiality as to justify repudiation of the contract.
Remedial Comparison Would expectation damages adequately compensate Harrison for the delay in cleaning the sign? (a) Yes (b) No
Finding A Material Breach Finding a material breach would only leave Walker & Co. the option of suing in restitution for the unpaid rent. Rental ends Rental begins Harrison stops paying rent Signed cleaned
A Forfeiture for Walker & Co.? Would restitution adequately compensate Walker & Co.? (a) Yes (b) No Rental ends Rental begins Harrison stops paying rent Signed cleaned
Criteria for Material Breach 1. the extent to which the failure to perform deprives the injured party of the benefit he or she reasonably expected to obtain under the contract; 2. the extent to which the injured party can be adequately compensated for the deprivation of the benefit; 3. the extent to which the party failing to perform will suffer a forfeiture; 4. the likelihood that the party failing to perform will cure the failure; 5. the extent to which party failing to perform acted in accord with standards of good faith and fair dealing.
