This section is from the book "The Law Of Contracts", by William Herbert Page. Also available from Amazon: Commercial Contracts: A Practical Guide to Deals, Contracts, Agreements and Promises.
After one of the parties has broken the contract, the subsequent acts of the party who is not in default should not affect his right of action to recover damages, unless such subsequent transaction is an accord and satisfaction,3 or other recognized form of discharge.4 The act of a lessor in forfeiting a lease for non-payment of rent, does not discharge his prior claim for damages for breach of a bond to erect a building upon such realty.5 Payment in full with knowledge of defects,6 or taking possession of a building,7 does not of itself waive a right of action for damages. Use of a building before final acceptance does not waive the right to recover liquidated damages for delay.8 If the contract provides that payment is not an acceptance of defective work,9 or if the owner gives notice, when he takes possession, that he will claim damages for defective work,10 taking possession of the building does not waive his right of action for damages. Failure to take advantage of a forfeiture clause, giving to the property owner the right to take possession of the building and to continue performance, does not waive his right of action for damages for defective performance.11 Permitting 12 or requiring 13 contractors to complete a building after the time limited for performance, or accepting goods delivered after the time fixed for performance,14 does not waive damages for such delay. Accepting property delivered after the time fixed for testing has expired does not waive a right of action for damages for breach of warranty.15 Accepting chattels offered as performance of a contract of sale with warranty,16 either express17 or implied,18 does not waive the right of action for damages if the chattels do not correspond to the warranty.19 If the seller has delayed the delivery of the goods sold, the acceptance of such goods by the buyer after the time fixed for performance is not a waiver of the buyer's right of action for such delay.20 The fact that the buyer signs a written statement to the effect that a machine which he has bought is properly installed, is not a waiver of damages for breach of warranty as to capacity.21
"For the injury done to him by the broken covenant of the other side, he may recover in a suit on the contract to perform within time; or, if he wait to be sued, he may recoup the damages thus sustained in reduction of the sum due by contract price for the completed work." Phillips & Colby Construction Co. v. Seymour, 91 U. S. 646, 23 L. ed. 341.
2 "The difficulty in this case has grown out of the failure to distinguish between a waiver of the right to treat a breach of a contract as a discharge of the contract, and a waiver of the right to recover the damages occasioned by the breach. The two rights are distinct and must not be confused." Frankfurt-Barnett Co. v. Prym Co., 237 Fed. 21, L. R. A. 1918A, 602.
3 Frankfurt-Barnett Co. v. William Prym Co., 237 Fed. 21, L. R. A. 1918A, 602; White v. Lumiere North American Co., 79 Vt. 206, 6 L. R. A. (N.S ) 807, 64 Atl. 1121.
4 See Sec. 2446 et seq.
5 Rock v. Monarch Building Co., 87 O. S. 244, 100 N. E. 887.
6 Leonard v. Home Builders, 174 Cal. 65, L. R. A. 1917C, 322, 161 Pac. 1151; Flannery v. Rohrmayer, 46 Conn. 558, 33 Am. Rep. 36.
The act of the party not in default in accepting partial payment and continuing performance after delay by the adversary party, which could have been treated as a discharge, does not waive damages for such delay, especially if the party in default had promised to make it right. McDonald v. Supple, - Or. -, 190 Pac. 315.
7 Lawrence County v. Stewart, 72 Ark. 525, 81 S. W. 1059; Leonard v. Home Builders, 174 Cal. 65, L. R. A. 1917C, 322, 161 Pac 1151; Cannon v. . Hunt, 116 Ga. 452, 42 S. E. 734.
8 Lawrence County v. Stewart, 72 Ark. 525, 81 S. W. 1059.
9 Dondis v. Borden, 230 Mass. 73, 119 N. E. 184.
10 Leonard v. Home Builders, 174 Cal. 65, L. R. A. 1917C, 322, 161 Pac 1151.
11 Brent v. Head, 138 Ia. 146, 16 L. R. A. (N.S.) 801, 115 N. W. 1106.
12 Bryson v. MrCone, 121 Cal. 153, 53 Pac. 637; Brent v. Head, 138 la. 146, 16 L R. A. (N.S.) 801, 115 N. W. 1106.
13 Phillips & Colby Construction Co. v. Seymour, 91 U. S. 646, 23 L. ed. 341; Johnson v. Henry, 127 Mich. 548, 86 N. W. 1027.
14 Redlands Orange Growers' Association v. Gorman, 161 Mo. 203, 54 L. R. A. 718, 61 S. W. 820.
15 Underwood v. Wolf, 131 111. 425, 19 Am. St. Rep. 40, 23 N. E. 598.
16 California. North Alaska Salmon Co. v. Hobbs, 159 Cal. 380, 35 L. R. A. (N.S.) 501, 113 Pac. 870.
Iowa. Rice v. Friend Bros. Co., 179 la. 355, 161 N. W. 310 [reversing judgment on rehearing, 146 N. W. 748].
Kansas. Weybrich v. Harris, 31 Kan. 92, 1 Pac. 271; McCormick v. Roberts, 32 Kan. 68, 3 Pac. 753; Cook-ingliam v. Dusa, 41 Kan. 229, 21 Pac. 95; Graff v. Osborne, 56 Kan. 162, 42 Pac. 704; International Filter Co. v. Caney Ice & Cold Storage Co., 84 Kan. 705, 115 Pac. 635; Lyman v. Wederski, 95 Kan. 438, 148 Pac. 642.
Michigan. Brown v. Pendergast, 193 Mich. 313, 159 N. W. 541.
Mississippi Hall Commission Co. v. Crook, 87 Miss. 445, 40 So. 20, 1006; Mobile Auto Co. v. Sturges, 107 Miss. 848, 66 So. 205; Rosenbaum's Sons v.
Davis & Andrews Co., 1ll Miss. 278, 71 So. 388; National Cash Register Co. v. Hude, 119 Miss. 36, 80 So. 378; Sharp v. Brookhaven Pressed Brick & Mfg Co., 120 Miss. 850, 83 So. 274.
Montana. St. Paul Machinery Mfg. Co. v. Bruce, 54 Mont. 549, 172 Pac. 330.
Oregon. Feeney & Bremer Co. v. Stone, 89 Or. 360, 171 Pac. 569.
Pennsylvania. Samuel v. Delaware River Steel Co., - Pa. St. -, 107 Atl 700.
South Dakota. Avery Co. v. Peterson, - S. D. -, 171 N. W. 204.
Washington. Fairbanks Steam Shovel Co. v. Holt, 79 Wash. 361, L. R. A. 1915B, 477, 140 Pac. 394.
17 California. North Alaska Salmon Co. v. Hobbs, 159 Cal. 380, 35 L. R. A. (N.S.) 501, 113 Pac. 870.
Georgia. North Georgia Milling Co. v. Henderson Elevator Co., 130 Ga. 113, 24 L. R. A. (N.S.) 235, 60 N. E. 258.
Maine. Morse v. Moore, 83 Me. 473, 23 Am. St. Rep. 783, 13 L. R. A. 224, 22 Atl. 362.
Mississippi. Bowers v. Southern Automatic Music Co., 114 Miss. 25, 74 So. 774.
New York. Heath Dry Gas Co. v. Hurd, 193 N. Y. 255, 25 L. R. A. (N.S.) 160, 86 N. E. 18.
18 Alabama. Frith v. Hollan, 133 Ala. 583, 91 Am. St. Rep. 64, 32 So. 494.
In the absence of warranty, either express or implied, no liability remains after acceptance of the goods which are delivered as performance of the contract.22