Anticipatory repudiation

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Contract law
Part of the common law series
Contract formation
Offer and acceptance · Mailbox rule Mirror image rule · Invitation to treat Firm offer · Consideration
Defenses against formation
Lack of capacity Duress · Undue influence Illusory promise · Statute of frauds Non est factum
Contract interpretation
Parol evidence rule Contract of adhesion Integration clause Contra proferentem
Excuses for non-performance
Mistake · Misrepresentation Frustration of purpose · Impossibility Impracticability · Illegality Unclean hands · Unconscionability Accord and satisfaction
Rights of third parties
Privity of contract Assignment · Delegation Novation · Third party beneficiary
Breach of contract
Anticipatory repudiation · Cover Exclusion clause · Efficient breach Fundamental breach
Remedies
Specific performance Liquidated damages Penal damages · Rescission
Quasi-contractual obligations
Promissory estoppel Quantum meruit
Subsets
Conflict of law · Commercial law
Other common law areas
Tort law · Property law Wills, trusts and estates Criminal law · Evidence
v • d • e

Anticipatory repudiation (or anticipatory breach) is a term in the law of contracts that describes a declaration by one party (the promising party) to a contract that they do not intend to live up to their obligations under the contract. Where such an event occurs, the other party (the performing party) to the contract is excused from having to fulfill their obligations. However, the repudiation can be retracted by the promising party so long as there has been no material change in the position of the performing party in the interim. A retraction of the repudiation restores the performer's obligation to perform on the contract.

If the promising party's repudiation makes it impossible to fulfill its promise, then retraction is not possible and no act by the promising party can restore the performing party's obligations under the contract. For example, if A promises to give B a unique sculpture in exchange for B painting A's house, but A then sells the sculpture to C before B begins the job, this act by A constitutes an anticipatory repudiation which excuses B from performing. Once the sculpture has left A's possession, there is no way that A can fulfill the promise to give the sculpture to B.

The question arises as to why any party would want to provide notice of anticipatory breach. The reason is that once the performing party is informed of the anticipatory breach, a duty is then created for the performing party to mitigate damages as a result of the breach.

Another situation where anticipatory repudiation can occur is where a party has reason to believe the other party is not going to perform and requests reasonable assurances that the other party will perform. If such reasonable assurances are not given, it will constitute anticipatory repudiation, for which the performing party has various remedies including termination.

However, anticipatory repudiation only applies to a bilateral executory contract with non-performed duties on both sides. Additionally, the repudiation must be unequivocal.

Anticipatory repudiation

See also