LEGAL PRINCIPLE: CONTRACT LAW — Entire vs Divisible Contracts — Effect of Breach Depends on Severability of Performance
PRINCIPLE STATEMENT
The effect of breach depends on whether the contract is indivisible (whole performance condition precedent) or divisible (partial performance binds pro tanto). The test is whether the whole quantity or acts are of the essence of the contract, depending on the parties' intention.
RATIO DECIDENDI (SOURCE)
Per Edozie, JSC, in Savannah Bank of Nigeria Plc v. Opanubi (2004) NLC-1542000(SC) at pp. 22–23; Paras E–A.
"According to Black's Law Dictionary, 6th Edition at p. 323: 'The effect of the breach of a contract depends in a large degree upon whether it is to be regarded as indivisible or divisible; i.e. whether it forms a whole, the performance of every part of which is a condition precedent to bind the performance of anyone of which will bind the other party pro tanto. The only test is whether the whole quantity of the things concerned, or the sum of the acts to be done, of the essence of the contract. It depends therefore, in the last resort, simply upon the intention of the parties.'"
EXPLANATION / SCOPE
Indivisible contracts require full performance as condition precedent; partial performance does not bind. Divisible contracts allow partial performance to bind pro tanto. The principle applies to contract law. The rule determines breach consequences. The test is the parties’ intention regarding the essence of the contract. Severability depends on whether the whole performance is essential or can be apportioned.
