CONTRACT LAW — Breach of Contract — Fundamental Term — Effect on Contract
Ratio Decidendi
Per Fabiyi, JSC, in Best (Nig) Ltd v. Blackwood Hodge (Nig) Ltd & Ors (2011) NLC-123-31-1999(SC) at p. 8; Paras D—E:
"A breach of contract is committed when a party to the contract without lawful excuse fails, neglects or refuses to perform an obligation he undertook in the contract or incapacitates himself from performing same or in a way back down from carrying out a material term. Where a party to a contract is in breach of a material term of same, the breach gives the aggrieved party a lee-way or an excuse for non-performance of its own side of the bargain. Such a party is at liberty to treat the contract as extinguished or at an end."
Explanation / Scope
This principle establishes that breach of a material term of a contract gives the aggrieved party an excuse for non-performance and the right to treat the contract as at an end. The principle applies in contract disputes. It ensures that material breaches have consequences. The principle reflects the effect of breach of fundamental terms. It allows the aggrieved party to terminate. The court must recognize the breach. The principle provides guidance on breach of contract.