In each of these cases, one party has profited from the
failure of the other to provide complete performance. A
strict application of the rule about precise perform-
ance would frequently lead to injustice. It is not surpris-
ing, therefore, that certain exceptions to the rule have
developed.
1 Doctrine of substantial performance.If the court
decides that the claimant has substantially carried out
the terms of the contract, the claimant may recover for
the work he or she has done. The defendant can coun-
terclaim for any defects in performance.
2 Acceptance of partial performance.If one of the
parties only partially carries out his side of the contract,
but the other party, exercising a genuine choice, accepts
the benefit of the partial performance, the court will
infer a promise to pay for the benefit received.
3 Performance prevented by the promise.A person
who is prevented from carrying out his side of the bar-
gain by the other party can bring an action to recover for
the work he has done.Part 3Business transactions
250
Cutterv Powell(1795)Cutter agreed to serve on a ship sailing from Jamaica
to Liverpool. He was to be paid 30 guineas on arrival at
Liverpool. The ship sailed on 2 August, arriving in Liverpool
on 9 October, but Cutter died at sea on 20 September.
It was held that his widow could not recover anything for
the work he had done before he died. Cutter was obliged
to complete the voyage before he was entitled to payment.
Comment. This old case is often presented as a classic
illustration of the law’s insistence on complete perform-
ance as a prerequisite of the right to sue in respect of
an entire contract. Although the point being made is still
valid, the case itself would not be decided in the same
way today. Cutter’s widow would now be able to argue
that her husband’s untimely death had frustrated the
contract and that she should recover in respect of the
valuable benefit her husband conferred on his employer
before his death under s 1(3) of the Law Reform (Fru-
strated Contracts) Act 1943.Boltonv Mahadeva(1972)Bolton installed a central heating system in Mahadeva’s
house for an agreed price of £560. The work was carried
out defectively and it was estimated that it would cost
£179 to put matters right. The Court of Appeal held that
since Bolton had not performed his side of the contract,
he could recover nothing for the work he had done.Hoenigv Isaacs(1952)The claimant agreed to decorate the defendant’s flat and
fit a bookcase and wardrobe for £750. On completion of
the work, the defendant paid £400 but he complainedabout faulty workmanship and refused to pay the bal-
ance of £350. The Court of Appeal held that the contract
had been substantially performed. The claimant was en-
titled to the outstanding £350, less the cost of remedy-
ing the defects, which was estimated at £55 18s 2d.Planchév Colburn(1831)The claimant agreed to write a book on ‘Costume and
Ancient Armour’, on completion of which he was to
receive £100. After he had done the necessary research
and written part of the book, the publishers abandoned
the project. He recovered 50 guineas for the work he had
done. The claimant’s claim was based on quasi-contract.
He could not sue on the contract because the obligation
to pay him did not arise until he had completed and
delivered the work to the publishers, which he had not
done. He was able to sue on a quantum meruit (see later
in this chapter) for the work he had done.4 Divisible contracts.Some contracts are said to be
‘entire’. This means that a party is not entitled to pay-
ment until he has completely performed his part of the
contract, e.g. CuttervPowell(1795). Other contracts
may be divisible, i.e. the obligations can be split up into
stages or parts. Payment can be claimed for each com-
pleted stage. A contract to build a house usually provides
for payment to be made in three stages: after the foun-
dations have been laid, when the roof goes on, and on
completion of the house.Agreement
The parties may have agreed in their original contract
that it should end automatically with the happening of
some event or after a fixed period of time. The agree-
ment may have included a term allowing either party to
terminate the contract by giving notice. A contract of