Contractual relationships though governed by written agreements can easily fall apart. In these instances, parties look to their agreements to find remedies to their problems. In the instance where the party is required to perform, yet does so in an incomplete or defective manner, this can be seen as a breach of contract. One may look to a well drafted contract to find the remedy for a positive malperformance. This article will aim to elaborate on the remedies available for those subject to a contract which has fallen into a breach due to positive malperformance.
Positive malperformance occurs where a party subject to a contractual relationship performs, but such performance is defective or incomplete. This may be due to a number of reasons such as complete performance being impossible due to natural disasters or a change in the law. Where a party performs, but such performance is incomplete, the receiving party may raise breach or rescission.
In well drafted contracts such an instance as positive malperformance is accounted for. In order to do this, there should be a clause which allows for the cancellation of the contract where positive malperformance has occurred. This is known as a rescission clause. A rescission clause allows for the creditor to give the debtor notice of intention to rescind should the breach not be corrected within a specified period of time. However, it should be noted that despite the creditor having the right to rescind the contract, he/she may only do so once the relevant notice has been served upon the debtor and the specified period therein has expired. Should the debtor perform before the expiry of the set period, this may not allow for the creditor to cancel the contract.
Contract law can be complex and frustrating to those who are unable to find a remedy to their issues. A contract can be well drafted, yet still not provide for the circumstances in which you find yourself, should you require any assistance, contact us and we will gladly assist.