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.
In order to amount to a prevention of performance by the adversary party, the conduct on the part of the party who is alleged to have prevented performance must be wrongful, and, accordingly, in excess of his legal rights.2 A lease of property to be used for saloon purposes does not imply an agreement by the lessor or his assignee to sign the petition for the license of such saloonkeeper.3 Employment by an owner of a non-union laborer, because of whom the contractor's workmen struck, does not amount to the owner's preventing the contractor from performing his contract.4 Whether a party to an instalment contract may treat the entire contract as discharged if the adversary party is in default or not,5 he is not excused for delay in performance after such default if he elects to treat the contract as in effect, unless he is able to show that such default contributed to such delay.6 If the owner is in default in paying instalments under a building contract, and the contractor elects to continue performance, he can not make use of such default as a defense to an action by the owner to recover liquidated damages for delay unless the contractor is able to show that such default on the part of the owner was the cause of such delay on his part.7
8 See Sec. LXXXVII
9 See Sec. 2922 et seq.
1 Sellers v. Catron, 5 Ind. Terr. 263, 82 S. W. 742.
2 Serber v. McLaughlin, 97 111. App. 104; Lansdowne v. Reihmann (Ky.), 124 S. W. 353.
3 Lansdowne v. Reihmann (Ky.), 124 S. W. 363.
4 Serber v. McLaughlin, 97 111. App. 104.
5 See Sec. 3008 et seq.
6 Chamberlih v. Booth, 135 Ga. 719, 35 L. R. A. (N.S.) 1223, 70 S. E. 569.
In order to operate as a discharge, the conduct of the party who is claimed to be in default must he such as in legal effect prevents performance, as distinguished from conduct which merely makes performance unpleasant or inconvenient.8 Profane and insulting language,9 or threats of personal violence,10 do not make performance impossible and can not be treated as discharging the contract.
The act of one party which makes performance by the other much more hazardous than was contemplated originally, operates as a prevention of performance.11 A agreed to take down trusses from an exposition building at five dollars per truss. While A was working upon such contract the owners of the building removed the shafting, rafters and bracing to such an extent that part of the building fell, and two of A's employes were killed. It was held that A could abandon the contract, consider it as discharged, and recover the profit that he would have earned had he completed his contract.12
To operate as a discharge it is not necessary that the party who makes performance by the other impossible, should take active steps thereto. It is sufficient if he omits to do something which he should do, and such omission causes the impossibility.13 A agreed to furnish certain materials to B for a building in which B was the principal contractor, the material to be paid for after it was accepted by the supervising architect. A shipped a carload of material, which was seized under a writ of attachment issued against B before it was placed in the building. It was held that A could recover, though such material was never accepted by the supervising architect.14 Omitting to secure a right of way which thereby falls into the hands of a competing railroad and makes the construction of the extension agreed upon impracticable, discharges one who has agreed to advance money for such extension.15 A purchaser of realty can not avoid a contract of sale because of an encumbrance which has been caused by such purchaser after such contract of sale.16 A delay caused by plumbers, working under an independent contract with the owner of a building, can not authorize a deduction from the contract price, provided for in the contract on account of default of the contractor.17
7 Chamberlin v. Booth, 135 Ga. 710, 35 L. R. A. (N.S.) 1223, 70 S. E. 569.
8 Smoot's Case, 82 U. S. (15 Wall.) 36, 21 L. ed. 107; Cole v. Alexander, 113 Ga. 1154, 39 S. E. 477; Chamber-lin v. Booth, 135 Ga. 710, 35 L. R. A. (N.S.) 1223, 70 S. E. 560; Thompson v. Brown, 106 Ia. 367, 76 N. W. 810.
9 Used by one drilling a well under contract. Thompson v. Brown, 106 Ia. 367, 76 N. W. 810.
10 Made by a vendor of realty under an executory contract of sale, to the vendee in possession; whereupon ho gave up possession and brought suit for the value, of improvements. Cole v. Alexander, 113 Ga. 1154, 39 S. E. 477.
1 1 Lynch v. Sellers, 41 La. Ann. 375, 5 L. R. A. 682, 6 So. 561.
12 Lynch v. Sellers, 41 La. Ann. 375, 5 L. R. A. 682, 6 So. 561.
1 3 United States v. Jack, 124 Mich. 210, 82 N. W. 1040.
14 United States v. Jack, 124 Mich. 210, 82 N. W. 1040.
For a case presenting similar facts, see Leek Milling Co. v. Langford, 81 Miss. 728, 33 So. 402.
Under a principle analogous to the doctrine of voluntary creation of impossibility of performance, it has been held that if a beneficiary under an insurance policy kills the insured, he forfeits his rights under the insurance policy and it should be paid to the insured's estate.18 The assignee of the beneficiary's interest under the policy can claim no interest thereunder.19 It has been held that a policy of life insurance, whether payable to the estate of the insured or to a designated beneficiary, is forfeited if the insured is executed for murder under sentence of a court of competent jurisdiction,20 and that the beneficiary will not be permitted, in an action on the policy, to show that the insured was in fact innocent,21 or that he committed the crime when insane.22
15 Porter v Blair, 83 Fed 104.
16 Mayes v. Martell, 87 Wash. 105, 151 Pac. 247,
17 Crouch v. Gutmann, 134 N. Y 43, 30 Am St. Rep 608, 31 N E 271.
18 England. Cleaver v. Mutual Reserve Fund Life Association , 1 Q B 147.
United States. New York Mutual Life Ins Co. v. Armstrong, 117 U. S. 591, 29 L. ed. 997.
Iowa Schmidt v. Northern Life Association, 112 Ia. 41, 84 Am. St. Rep. 323, 51 L. R. A. 141, 83 N. W. 800; McDonald v. Mutual Life Ins. Co, 178 Ia. 863, 160 N. W. 289.
Ohio. Filmore v. Metropolitan Life Ins. Co., 82 O. S. 208, 92 N. E. 26.
See, Life Insurance - Suicide and Execution for Crime, by Geo. Richards, 22 Yale Law Journal, 292.
Oklahoma. Equitable Life Assurance Society v. Weightman, - Okla. - , 160 Pac. 629.
19 Schmidt v. Northern Life Association, 112 Ia. 41, 84 Am. St. Rep. 323, 51 L. R. A. 141. 83 N. W. 800.,
20 Amicable Society v. Bo Hand, 4 Bllgh (N.S ) 194, 2 Dow. & C. I; Burt v Union Central Life Ins Co, 187 U. S 362, 47 L. ed 216 [affirming, 105 Fed 419, 59 L R. A 393]; Northwestern Mutual Life Ins. Co. v. Mc-Cue, 223 U S 234, 38 L R. A. (NS.) 57,56 L. ed. 419} Scarborough v. American National Insurance Co, 171 N. Car. 353, L R. A. 1918A, 896, 88 S. E. 482
Contra, on the theory that this amounts to a corruption of blood or forfeiture of estate for conviction. Collins v. Metropolitan Life Ins. Co., 232 I1L 87, 122 Am. St. Rep. 54, 14 L. R. A. (NS.) 356, 83 N. E. 542.
2 1 Burt v. Union Central Life Ins. Ob., 187 U. S. 362, 47 L. ed. 216 [affirming, 105 Fed. 419, 59 L. R. A. 393].
22 Burt v. Union Central Life Ins. Co., 187 U. S. 362, 47 L. ed. 216 [af-firming, 105 Fed. 419, 59 L R. A. 393].
Demanding performance in an illegal manner is equivalent to making performance impossible,23 although it is also analogous to refusing performance unless a modification, and in this case an illegal modification, is assented to,24 which is a form of renunciation.25
If the contract could not be performed in any event, conduct by one party which would have made performance impossible had it been possible before, does not amount to an actionable breach, as no damage exists. A agreed with B to pay a certain sum if B should collect a claim of A's against X in full. If such claim was in fact uncollectible, A's assignment of such claim did not amount to a breach.26