Bowen ordered Ames from the premises and refused to allow him to continue. Will Ames be able to collect damages from Bowen? Explain.
By written contract, Ames agreed to build a house on Bowen’s lot for $165,000, commencing within ninety days of the date of the contract. Prior to the date for beginning construction, Ames informed Bowen that he was repudiating the contract and would not perform. Bowen refused to accept the repudiation and demanded fulfillment of the contract. Eighty days after the date of the contract, Bowen entered into a new contract with Curd for $162,000. The next day, without knowledge or notice of Bowen’s contract with Curd, Ames began construction. Bowen ordered Ames from the premises and refused to allow him to continue. Will Ames be able to collect damages from Bowen? Explain.
This is a case of anticipatory repudiation wherein Individual A has declared that they do not intend to satisfy their obligations under the contract. This action discharges Individual A of performance. However, Individual B must wait until the time of the performance to see whether Individual A is going to withdraw the repudiation and perform their contractual duties.
Individual A can withdraw the repudiation provided that the retraction is brought to the attention of the Individual B before Individual B materially alters their role in the dependence on repudiation or indicates, to Individual A, that they consider the repudiation to be final.
If the retraction comes into effect and the performance of Individual A occurs, the performance is going to be discharged. Otherwise, if Individual A does not perform, it is a material violation.
Individual B is going to prevail because, in that case, Individual A ha snot notified of the retraction of the repudiation, which has forced Individual B to materially change their stance by hiring Individual C for the construction of the building.
Individual B is going tow in the suit since there is repudiation from Individual A. Though there is a retraction of repudiation by Individual A, it has not been put in the notice of Individual B.