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.
Until breach no cause of action arises on a contract.1 Upon breach a cause of action arises in favor of the party who is not in default, and against the party in default.2 Whatever effect the refusal of a party to perform may have upon the property rights of the adversary party, it can not affect the liability of the party in default upon the covenant which he has broken.3
11 Schillinger v. Bosch-Ryan Grain Co., 145 la. 750, 122 N. W. 961 [affirming, 116 N. W. 132]
12 Schillinger v. Bosch-Ryan Grain Co., 145 la. 750, 122 N. W. 961 [affirming, 116 N. W. 132].
13 Schillinger v. Bosch-Ryan Grain Co., 145 la. 750, 122 N. W. 961 [affirming, 116 N. W. 132].
14 Chamberlin v. Booth, 135 Ga. 719, 35 L. R. A. (N.S.) 1223, 70 S. E. 569.
15Chamberlin v. Booth, 135 Ga. 719, 35 L. R. A. (N.S.) 1223, 70 S. E. 569.
16 Chamberlin v. Booth, 135 Ga. 719, 35 L. R. A. (N.S.) 1223, 70 S. E. 569.
17 Milske v. Steiner Mantel Co.. 103 Md. 235, 115 Am. St. Rep. 354, 5 L. R. A. (N.S.) 1105, 63 Atl. 471; Jones v. Whittier, 77 N. J. L. 715, 73 Atl. 497; Dillon v. Suburban Land Co., 73 W. Va. 363, 80 S. E. 471.
18 Dillon v. Suburban Land Co., 73 W. Va. 363, 80 S. E. 471.
1 Alabama. Elliott v. Nicolea, 182 Ala. 159, 62 So. 499.
Breach of contract may have three different results according to the circumstances of the case and the election of the party not in default: (1) The party not in default may maintain an action for damages against the party in default,4 or under the proper circumstances he may sue in equity for the affirmative relief of specific performance,5 or for the negative relief of injunction, rescission or cancellation.6 (2) The party not in default may, in some cases, elect to treat such breach as discharge, refuse to perform further, and use such breach as a defense.7 (3) If the breach is such as to operate as a discharge of the contract, the party who is not in default, and in some jurisdictions, the party who is in default, may ignore the contract as the basis of rights and may sue in quasi-contract to recover reasonable compensation for what such party has furnished in partial performance of the contract.8
California. Franz v. Bieler, 126 Cal. 176, 56 Pac. 249, 58 Pac. 466.
Florida. Hall v. Northern & Southern Co., 55 Fla. 242, 46 So. 178.
Maryland. Junkins v. Sullivan, 110 Md. 530, 73 Atl. 264.
Minnesota. Southworth v. Rosen-dahl, 133 Minn. 447, 3 A. L. R. 468, 158 N. W. 717.
Montana. Chealey v. Purdy, 54 Mont. 480, 171 Pac. 926.
South Carolina. Tillinghast v. Lumber Co., 39 S. Car. 484, 22 L. R. A. 49, 18 S. E. 120.
2 England. Ogdens v. Nelson , 2 K.B. 410.
Alabama. Martin v. Powell, - Ala. -, 75 So. 358.
Colorado. Henderson v. Spratlen, 44 Colo. 278, 19 L. R. A. (N.S.) 655, 08 Pac. 14.
Georgia. Montgomery v. Hunt, 09 6a. 499, 27 S. E. 701.
Illinois. Pungs v. Brake Beam Co., 200 111. 306, 65 N. E. 645.
Louisiana. Hebert v. Weil, 115 La. 424, 39 So. 380.
Maryland. Ady v. Jenkins, - Md. -, 104 Atl. 178.
Michigan. Droppers v. Marshall, -• Mich. -, 4 A. L. R. 1266, 168 N. W. 1001.
Nebraska. Hixson Map Co. v. Nebraska Post Co., 5 Neb. (unoff.) 388, 98 N. W. 872.
Oklahoma. Hart-Parr Co. v. Duncan, - Okla. -, 4 A. L. R. 1434, 181 Pac. 288.
3 Martin v. Powell, - Ala. -, 75 So. 358.
4 See ch. LXXXVII.
5 See ch. LXXXIX.
6 See ch. XC.
7 See Sec. 3024 et seq.
8 See ch. LXXXVIII.
Sec. 3024. Bight of party in default The party who is in default can not elect to treat the contract as discharged if the adversary party wishes to treat it as in effect.1 In many jurisdictions he can not take advantage of his own breach to recover reasonable compensation for what he has done under' the contract, if the adversary party is willing to accept what has been done as full performance.2 An insurance company can not discharge a policy by renouncing liability thereunder.3 If the insurance policy is paid up and the beneficiaries do not acquiesce in such renunciation by the insurance company, the policy remains in effect.4 If the beneficiaries or the insured object to such renunciation, their right to treat the policy as in effect is even clearer.5 If materials for a building are to be delivered in instalments, the default of the seller in delivering part of such material is a breach of which only the purchaser can take advantage; and such breach does not of itself accelerate the time of performance of such contract for the purpose of determining the time within which a lien for such material may be taken.6
It is frequently said that a party to an executory contract, except contracts which equity will enforce by the remedies of specific performance,7 or injunction,8 may break such contract so as to terminate it and to leave in place of his original liability to perform the contract his substituted liability to make compensation to the adversary party for the damage caused by such breach.9 Language is sometimes used which seems to indicate that the courts regard this action of the party who is in default as the exercise of a legal right.10 It is likely, however, that even the courts which use this language do not really mean that the party in default is exercising a legal right: The breach of a simple contract was originally classed as a sort of private wrong which was little, if any, different from the ordinary tort;11 and the view that breach of a contract is a wrongful act rather than a rightful act is repeated by the courts.12
1 In re Hellams, 223 Fed. 460; Mail & Times Publishing Co. v. Marks, 125 la. 622, 101 N. W. 458.
2 Mail & Times Publishing Co. v. Marks, 125 la. 622, 101 N. W. 458.
See ch. LXXXVIII.
3 United States. Wright v. Manhattan Life Ins. Co., 126 Fed. 82.
Iowa. Nutter v. Des Moines Life Ins. Co.. 156 la. 539, 136 N. W. 891.
Minnesota. Palmer v. Mutual Life Ins. Co., 121 Minn. 395, 141 N. W. 518.