other cases, conditioned upon satisfaction of a mortgage securing the debt or the return of an article pledged therefor.23 Tender must also be made at a reasonably proper time and place.

Defects in tender may be waived by refusal to accept the tender on some other ground than that set up in answer to a plea of tender. Tender is excused when the creditor avoids the debtor or absents himself from home to avoid a tender or informs the debtor that it will be unavailing to make a tender.

BY BREACH

Breach of a contract always creates a new right of action in favor of the injured party and may take place in any one of three ways. (1) A party may renounce his liabilities under it either before performance is due or in course of performance. (2) He may by his own act make performance impossible either before it is due or in course of performance. (3) He may merely fail or neglect to perform either totally or partially without express renunciation or impossibility. Whether in the last case it operates as a discharge and thus releases the injured party from performance is a difficult question to determine and one on which the courts differ. This will be considered later.

§ 126. Renunciation. Rule Before Performance is Due. A party has not only a right to performance of the contract when due but also a right to the maintenance of the contractual relation up to the time for performance. Therefore, if one party renounces the contract before the time for performance by distinctly stating that he will not be bound by it nor perform its obligation when due, the other party may either regard the contract as still in effect and sue for damages at the time performance is due or he may regard the contract as discharged and at once sue for damages for the breach.

The injured party elected to pursue the latter course in a celebrated case,24 where the defendant who had con

23 Loughborough v. McNevin, 74 Cal. 250, 14 Pac. 369, 5 Am. St. Rep. 435. 24 Hochster v. De La Tour, 2 El. & Bl. 678.

tracted to employ the plaintiff, sent him notice before the time for the employment to commence, that he should not require his services. The plaintiff at once brought suit and the court stated the rule of law on which it held the plaintiff was entitled to recover, as follows:

"Where there is a contract to do an act on a future day, there is a relation constituted between the parties in the meantime by the contract, and......they impliedly promise that in the meantime neither will do anything to the prejudice of the other inconsistent with that relation."

Limitations of Rule. The rule as laid down above is subject to several limitations:

(1) The renunciation must be unequivocal and absolute.25 (2) It must relate to such a substantial portion of the contract that an actual breach at the time of performance would terminate the whole contract.

(3) The rule does not apply to unilateral obligations to pay money, such as promissory notes, because no legal right has been violated until payment has been refused at maturity.

(4) If the promisee did not accept the renunciation when he had a legal right to do so, and continues to insist on performance, in such event the contract remains in existence for the benefit and risk of both parties. Thus, if something should take place after the renunciation and before the time for performance to render performance impossible or illegal, the promisor would be thereby discharged, notwithstanding his previous renunciation, because the promisee had elected to keep the contract in force. This limitation is illustrated in a case where a ship owner agreed by charter party with a merchant that his ship should sail to Odessa and there take a cargo from the merchant's agent by a limited time. Upon reaching Odessa the agent refused to deliver a cargo to the master of the ship, who remained in port and continued his demands for a cargo 25 Dingley v. Oler, 117 U. S. 490, 29 L. ed. 984.

instead of treating his refusal as a discharge and sailing away. Before the expiration of the time agreed upon for the delivery of the cargo had expired, war was declared between England and Russia, which rendered performance legally impossible. Later, when the owner sued for breach of contract it was held that since there had been no actual failure of performance before the war broke out and the renunciation had not been accepted as a breach, the merchant was entitled to the benefit of the discharge of the contract by the declaration of war.26

(5) Because of the right of the injured party to treat the renunciation as a breach or not, as he may elect, it follows that he is not bound to bring his action for breach before the time fixed for performance even though he might thus mitigate the damages. Thus, where A on December 15 bought of B 100,000 bushels of barley to be delivered in January, the purchaser cannot be compelled to resell the same on the market before the last day for delivery, even though B informed him the day after the sale was made that he would not carry out the contract and a re-sale at that time would have greatly reduced the damages.27

(6) After renunciation the injured party cannot continue performance of an executory contract and thereby increase his damages. Thus, if A should agree with B for the building of a wagon, and then countermand the order, B would have no right to obstinately insist on performing the work and thus make the damages greater than they otherwise would have been.28

Rule in Course of Performance. If one of the parties in the course of performance deliberately refuses to further perform, the other party may treat the renunciation as a discharge and recover damages. Thus, where goods are

26 Avery v. Bowden, 5 El. & Bl. 714.

27 Kadish v. Young, 108 Ill. 170, 48 Am. Rep. 548.

28 Clark v. Marsiglia, 1 Denio (N. Y.) 317, 43 Am. Dec. 670; Gibbons v. Bente, 51 Minn. 499, 53 N. W. 756, 22 L. R. A. 80.

to be manufactured and delivered in installments, the manufacturer is not bound to continue their manufacture and tender them when the other party after accepting a portion of the goods, notifies him not to deliver any more, and the manufacturer should not continue manufacturing to increase the damages.

§ 127. Impossibility Created by Party. If a party before time for performance, by his own act makes it impossible to perform, the other party may treat the contract as discharged and sue at once for a breach as in the case of renunciation. "If a man promises to marry a woman on a future day, and before that day marries another woman, he is instantly liable to an action for breach of promise of marriage.29 If a man contracts to execute a lease on and from a future day for a certain term, and, before that day, executes a lease to another for the same term, he may be immediately sued for breaking the contract."'30

The rule is the same where, in the course of performance, one party makes further performance impossible. Thus, if a publisher should engage a person to write an article for his magazine and then discontinue its publication when the article was partly completed, damages might be recovered without completion of the article or there might be recovery in quantum meruit for the work actually done.31

§ 128. Failure to Perform. Where a party openly declares that he will not perform or by his act has rendered performance impossible, we have seen that the injured party may consider the contract discharged and at once sue for a breach without tendering performance. But whether the injured party may do the same where the breach does not make the contract wholly incapable of performance, or where the other party merely fails to perform without any overt expression of intention to release the injured party from performance on his part, is a question which is often difficult to answer. Its solution

29 Short v. Stone, 8 Q. B. 358.

30 Campbell, C. J., in Hochster v. De La Tour, 2 El. & Bl. 678, 688. 31 Planche v. Colburn, 8 Bing. 14.

depends upon the intention of the parties as to the nature of their respective promises as shown by the terms of the contract. The general rule is that if the respective promises are independent of each other, the contract is not discharged and the injured party must tender performance. On the other hand, if the promises are conditional upon each other, the contract is generally discharged and the injured party thereby released from performance.

Independent Promises. A promise may be independent by being (a) absolute, (b) divisible, or (c) subsidiary.

Absolute Promises. Where the injured party has not made his promise to perform dependent upon prior or concurrent performance by the other party, it is generally held that he is not discharged by failure of the other party to perform and must, therefore, tender performance. Thus, if A promises to sell his horse to B for $100 on January 1, tender of performance by either party is necessary before he can bring an action against the other to recover damages for failing to perform. If the contract provides that one party is not to perform until after the other, there is no difficulty in determining whether a promise is absolute. Thus, where A agrees to sell his horse to B on January 1 for $100, to be paid on February 1 following, it is clear that A's promise is absolute and he must tender performance before he can recover for B's failure to perform, but that B after January 1 might sue for breach without tendering the $100 because his promise was not to pay until February 1. "When it appears that one of two covenants or promises is to be performed at an earlier date than the other,..... the rule is simple and uniform, namely, that the covenant or promise that is to be performed first is independent and absolute, while the one that is to be performed last is dependent, the performance of the former being a condition precedent to the performance of the latter.""32

When these tests cannot be applied, the question whether covenants are dependent or absolute must be determined in each case upon the proper construction to be placed on the 32 Langdell's Summary of Contracts, § 122.