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.
Election on the part of the party who is not in default, to treat the contract as in effect, operates as a waiver of his right to treat it as discharged for the same breach.1 A party who has elected to treat a contract as severable,2 such as a contract for the transportation of a certain quantity of material each year until the entire quantity is transported,3 can not thereafter change his position and treat a breach by the adversary party as a discharge of the contract on the theory that it is entire. If the party not in default has elected to treat the contract as still in effect, and the party in default wishes to perform after such default, he may do so,4 and, upon performance, recover under the contract,5 less the amount of damages, if any, caused by delay.6 In such cases the contract is not discharged, but remains in full force. If the party who is not in default elects to act under the contract in spite of the breach, he can not prevent the party who is in default from treating the contract as the measure of the rights of the parties.7 If the party not in default elects to treat the contract as in force, he must show readiness and willingness to perform in order to keep the party in default from recovering the amount paid in by him in performance of the contract before his breach thereof.8
4 Ohio & Mississippi Ry. v. McCarthy, 96 U. S. 258, 24 L. ed. 693.
5 Cheney v. Billy, 74 Fed. 52, 20 C. C. A. 291.
6 Avery v. Willson, 81 N. Y. 341, 37 Am. Rep. 503.
7 Bean v. Bunker, 68 Vt. 72, 33 Atl. 1068.
8 Poison Logging Co. v. Neumeyer, 229 Fed. 705; Sutton v. Risser, 104 la. 631, 74 N. W 23.
In cases of this sort it is possible that tender of the proper amount might have been made if objection had been based on that ground.
9 Jackson v. Rogers, - S. Car. -, 96 S. E. 692.
10 German Ins. Co. v. Gueck, 130 III 345, 6 L. R. A. 835, 23 N. E. 112.
11 Meincke v. Falk, 61 Wis. 623, 50 Am. Rep. 157, 21 N. W. 785.
1 Canada. Sorette v. Development Co., 31 N. S. 427.
United States. District of Columbia v. Camden Iron Works, 181 U. S. 453, 45 L. ed. 948; Graham v. United States, 188 Fed. 651; Northwest Auto Co. v. Harmon, 250 Fed. 832; Landes v Klopstock, 252 Fed. 89; Stennick v. Jones, 252 Fed. 345 [opinion modified, 256 Fed. 354].
Arkansas. Grand Lodge A. O. U. W. v. Davidson (Ark.), L. R. A. 1917C, ©14, 191 S. W. 961.
California. Witmer Brothers Co. v. Weid, 108 Cal. 569, 41 Pac. 491; Smith v. Mathews Construction Co., 179 Cal. 797, 179 Pac 205.
Florida. Roess Lumber Co. v. State Exchange Bank, 68 Fla. 324, L. R. A. 1918E, 297, 67 So. 188.
Georgia. Pitcher v. Lowe, 95 Ga. 423, 22 S. E. 678; McAuliffe v. Vaugh-an, 135 Ga. 852, 33 L. R. A. (N.S.) 255, 70 S. E. 322.
Illinois. Butterick Publishing Co. v. Whitcomb, 225 111. 605, 8 L. R. A. (N. S.) 1004, 80 N. E. 247; Hills v. Mc-Munn, 232 111 488, 83 N. E. 963.
Iowa. Dahl v. Thompson, 98 la. 599, 67 N. W. 579.
Kentucky. Louisville & Nashville By. v. Mason & Hoge Co. (Ky.), 104 S. W. 975.
Louisiana. Des Allemands Lumber Co. v. Morgan City Timber Co., 117 La. 1, 41 So. 332.
Massachusetts. Jones v. Brown, 171 Mass. 318, 50 N. E. 648.
Michigan. Robinson v. Lake Shore & Michigan Southern Ry., 103 Mich. 607, 61 N. W. 1014; Gates v. Detroit & Mackinac Ry., 147 Mich. 523, III N. W. 101.
Mississippi. Klein v. Buck, 73. Miss. 133, 18 So. 891.
Nebraska. Izard v. Kimmel, 26 Neb. 51, 41 N. W. 1068; Mundt v. Simpkins, 81 Neb. 1, 115 N. W. 325.
New York. Wolfert v. Caledonia Springs Ice Co., 195 N. Y. 118, 21 L. R. A. (N.S.) 864, 88 N. E. 24.
North Dakota. Plummer v. Kelly, 7 N. D. 88, 73 N. W. 70.
Washington. Garrison v. Newton, 96 Wash. 284, 4 A. L. R. 804, 165 Pac. 90.
Wisconsin. Tickler v. Andrae Mfg. Co., 95 Wis. 352, 70 N. W. 292; Lay-cock v. Moon, 97 Wis. 59, 72 N. W. 372; Woodman v. Blue Grass Land Co., 125 Wis. 489, 103 N. W. 236, 104 N. W. 920; Milwaukee Boston Store v. Katz, 153 Wis. 492, 140 N. W. 1038.
2 Gates v. Detroit & Mackinac Ry. Co., 147 Mich. 523, 111 N. W. 101.
3Gates v. Detroit & Mackinac Ry. Co., 147 Mich. 523, 111 N. W. 101.
4 Orr v. Cooledge, 117 Ga. 195, 43. S. E. 527; Lapsley v. Howard, 119 Mo. 489, 24 S. W. 1020.
5 Orr v. Cooledge, 117 Ga. 195, 43 S. E. 527; Rosenthal Paper Co. v. National Folding Box & Paper Co., 226 N. Y. 313, 123 N. E. 766.
6 Whether waiver of breach, as discharge, is a waiver of a right of action for damages, see Sec. 3063 et seq.
If the contract becomes impossible of performance before the party who is not in default has accepted the breach as discharging the contract it will be discharged.9 Accordingly, impossibility due to the destruction of the subject-matter,10 or due to war,11 will operate as a discharge of the contract; and the party who is not in default and who has elected to treat the contract as in force can not change his position after the occurrence of the event which renders performance impossible, and treat the breach as a discharge. To operate as such discharge, however, the impossibility must be technical impossibility; that is, impossibility of the sort that would operate as a discharge without regard to the breach.12
If the party originally in default performs, before the adversary party elects to treat it as a breach, his rights under the contract stand as if the contract had never been broken,13 except as concerns his liability for damages. If the party who is not in default elects to grant an extension of time in which the adversary party acquiesces, the contract will be regarded as broken, for the purpose of fixing the measure of damages,14 by the failure of the party who was originally in default to perform by the end of such extension of time.15 Subsequent breach by the party not in default may prevent the latter from recovery, and in such case he can not revert to the original breach as a discharge.16 A was to manufacture certain cars for a railroad, using in part material furnished by the railroad. This material was not furnished when due, and A was delayed in commencing work. Instead of treating this as a discharge A performed when the material arrived. Before A had delivered the ears they were destroyed by fire. It was held that A could not recover from the railroad, since the fire was in no way caused by the delay in furnishing material, and such breach was waived as a ground of discharge by A's continuing performance.17 If a property owner makes default in paying instalments when due, and the contractor does not elect to treat such default as a discharge of the contract, but continues performance, he can not make use of such default on the part of the owner as a defense to an action for his own default in not completing the building at the time fixed by the contract, unless he is able to show that such default in payment was the cause of his own delay.18
7 Rosenthal Paper Co. v. National Folding Box & Paper Co., 220 N. Y. 313, 123 N. £. 700.
8 Woodman v. Blue Grass Land Co., 125 Wis. 489, 103 N. W. 230, 104 N. W. 020.
9 Avery v. Bowden, 5 E, & B. 714; Krause v. Board of Trustees, 162 Ind. 278, 102 Am. St. Rep. 203, 05 L. R. A. 1ll, 70 N. E. 204.
10 Prause v. Board or Trustees, 162 Ind. 278, 102 Am. St. Rep. 203, 05 L. R. A. 111,70 N. E. 204.
11 Avery v. Bowden, 5 E. & B. 714.
12 See Sec. 2667 et seq.
13 Pratt v. S. Freeman & Sons Mfg. Co., 115 Wis. 648, 92 N. W. 368.
14 See ch. LXXXVII.
15 Fahey v. Updike Elevator Co., -Neb. -, 171 N. W. 50.
16Chamberlin v. Booth, 135 Ga. 710, 35 L. R. A. (N.S.) 1223, 70 S. E. 569; McConihe v. New York & Erie Ry. Go., 20 N. Y. 495, 75 Am. Dec 420.