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.
When the election is made with full knowledge of the facts, it is final;1 and the election of one of these rights operates as a waiver of the other alternative and inconsistent right.2 The election of the party not in default to treat the contract as discharged operates as a final discharge of the contract in the absence of a subsequent waiver thereof acquiesced in by both parties.3 If a breach by the promisor is accepted as discharge by the promisee, the subsequent offer of the promisor to perform does not prevent the contract from operating as a discharge;4 nor does it give the promisor the right to recover on the contract;5 nor does it prevent him from being liable for breach of such contract.6 A breach of a contract of employment which amounts to total discharge, and which is so treated by the employe, operates as a discharge of a covenant on the part of the employe not to compete with his former employer after the termination of his employment.7 If the party who is not in default elects to treat the breach of the adversary party as a discharge, he can not enforce a covenant for liquidated damages as far as such damages are incurred after such ejection to treat the contract as discharged; 8 nor can he recover instalments which come due under the contract after he has elected to treat it as discharged;9 nor can he recover the full contract price as if he had performed in full.10 If the party who is not in default has elected to treat the breach as a discharge and has entered into other contracts which would prevent him from performance of the contract which is thus discharged,11 or if he has so acted, in order to mitigate damages, that it is no longer practicable for him to perform,12 he can not thereafter be put in default by the demand of the party who was originally in default that he continue to perform.
1 Hennessy v. Bacon, 137 U. S. 78, 34 L. ed. 605; Watson v. Brown, 113 la. 308, 86 N. W. 28; St. Regis Paper Co. v. Santa Clara Lumber Co., 186 N. Y. 89, 78 N. E. 701; Seeds v. Simpson, 16 O. S. 321.
2 Seeds v. Simpson, 16 0. S. 321.
3 Winningham v. Trueblood, 140 Mo. 572, 51 S. W. 309.
4 Winningham v. Trueblood, 140 Mo. 572, 51 S. W. 300.
5 Seeds v. Simpson, 16 O. S. 321.
6 Seeds v. Simpson, 16 0. S. 321.
Co., 155 Fed. 77, 11 L. R. A. (N.S.) 713; Graham v. United States, 188 Fed. 651.
Arkansas. Rodgers v. Wise, 106 Ark. 310, 43 L. R. A. (N.S.) 1000, 153 S. W. 253.
Louisiana. Des Allemands Lumber Co. v. Morgan City Timber Co., 117 La. 1, 41 So. 332.
Washington. Croup v. Humboldt Quartz & Placer Mining Co., 87 Wash. 248, L. R. A. 1918A, 537, 151 Pac. 403.
Wisconsin. Milwaukee Boston Store v. Katz, 153 Wis. 402, 140 N. W. 1038.
2 See Sec. 3037 et seq.
3 Lima Locomotive & Machine Co. v. National Steel Castings Co., 165 Fed. 77, 11 L. R. A. (N.S.) 713; Des Alle-mandti Lumber Co. v. Morgan City Timber Co., 117 La. 1, 41 So. 332; Murray v. Barnhart, 117 La. 1023, 42 So. 489; Croup v. Humboldt Quartz & Placer Mining Co., 87 Wash. 248, L. R. A. 1918A, 537, 151 Pac. 493; Garey v. Pasco, 89 Wash. 382, 154 Pac. 433.
4 Contract to furnish certain articles. Lima Locomotive & Machine Co. v. National Steel Castings Co., 155 Fed. 77, 11 L. R. A. (N.S.) 713.
Contract to convey realty. Clover v. Gottlieb, 50 La. Ann. 568, 23 So. 459.
Contract for constructing waterworks. Grand Haven v. Waterworks, 99 Mich. 106, 57 N. \V. 1075.
Breach by employe of contract of employment. Tennessee Mfg. Co. v. James,91 Tenn. 154, 30 Am. St. Rep. 865, 15 L. R. A. 211, 18 S. W. 262..
5 The Akaba, 54 Fed. 197.
6 Lima Locomotive & Machine Co. v. National Steel Castings Co., 155 Fed. 77, 11 L. R. A. (N.S.) 713; Emack v. Hughes, 74 Vt. 382, 52 Atl 1061.
7 General Billposting Co. v. Atkinson , A. C. 118.
8 Garey v. Pasco, 89 Wash. 382, 154 Pac. 433.
9 Croup v. Humboldt Quartz & Placer Mining Co., 87 Wash. 248, L. R. A. 1918A, 537, 151 Pac. 493.
l0 Rodgers v. Wise, 106 Ark 310, 49 L. R. A. (N.S.) 1009, 153 S. W. 253.
If the party who is not in default elects to treat the breach as a discharge of the contract, which enables him to recover what he has furnished under the contract on the theory of quasi-contract, he is precluded by such election from treating the contract as in force for the purpose of enabling him to recover damages which arise solely from the failure of the adversary party to perform the covenants upon his side,13 or to recover the price fixed by the contract, on the theory that the contract is still in force.14 Such election does not preclude him, however, from recovering special damages due to the attempt on his part to perform, for which he can not recover on the theory of quasi-contract.15 The election of the party not in default to treat a contract as discharged by reason of breach on the part of the adversary party, so as to avoid liability on the executory covenants of the party not in default, does not prevent the party who is not in default from maintaining an action against the party who is in default, to recover damages sustained by reason of such breach.16