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Page 3
Substantial Performance of an Entire Obligation
Unresolved issue is the treatment of an entire contract and in particular whether the
of substantial performance
will apply.
s 37(2)(b):
what is a substantial breach within the meaning of the CCLA?
Viegers v Cook
At CL - this decision was analysed as an entire contract which did not fall within the exception
of substantial performance
How would you deal with this under CCLA?
Undertaker claiming lump sum contract for payment
Breach claimed by promisee: undertaker failed to procure a normal burial service - the
coffin burst
Breach according to D went to the root of the contract
Consequences of the breach → funeral ruined
s 37(2)(b)
would need to be considered
Undertaker’s breach substantially reduced the benefit of the contract
Hoenig v Isaacs
Examines concept of the ‘entire contract’ →
Cutter v Powell:
promise to pay conditioned
on event - contract demands entire performance
Entire contract doctrines give rise to practical problems:
What is an entire contract?
What happens if the entire contract is not rendered?
Is there any exception?
How does this fit in with CCLA?
Contract between builder and homeowners
Owner’s promise to pay final installments conditional on full performance
Retention of 15% that will be paid on job completion
Retention amount was $450
Owner paid $100 and said that the contract was fully performed - job not properly
completed due to defects
Claim by contractors for $350
Found in favour for P
Condition precedent of payment is not complete performance but of substantial

Page 4
CCLA s 118:
equity’s historical approach preserved
Time will not be considered of the essence unless
The parties have expressly stipulated that performance on time of an obligation is
essential and must be strictly complied with: ‘
time is of the essence of this
The nature of the subject matter and the surrounding circumstances show that
time was intended to be of the essence
The party who has been subjected to unreasonable delay gives a notice about
making time of the essence to put the counterparty into wrongful repudiation
The term is either a condition precedent that the job is done or not
Only if the breach does to the root of the contract can the employer not pay
Time of the Essence
Expressly Stated
Union Eagle
Contract for purchase of $2.4mil apartment with
10% deposit payable by 5pm on 24th Sept,otherwise
deposit forfeited
Did not pay until 5:10pm
Court will give effect to the time provision even
when the consequences are trivial
There is no difficulty in fitting this type of provision
into the contractual remedies legislation
It is an
essential term.
Time of the essence clauses can be implied by the
surrounding circumstances
E.g. the nature of the subject matter of contract or
surrounding circumstances
Bunge Corporation v Tradax Export SA
Buyers purchased 15,000 tonnes of soya bean meal
for shipment in a string of contracts
Terms stipulates that there must be 15 days notice
given of readiness of the vessel - did not do this until
4 days

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