MBE Rules · Contracts
Substantial performance (common law)
The rule
In common-law contracts, a party who substantially performs is entitled to the contract price minus damages for the deficiency. Substantial performance means that the breach is not material and the essential purpose has been achieved.
In plain English
If you mostly do what you promised in a contract, you can still get paid, but the other side can deduct money for any minor issues.
Worked example
The builder finishes a house but uses the wrong paint color. The buyer pays the full price minus the cost to repaint.
Memory hook
Substantial = Sufficient, not Spotless. Fulfill the core purpose, minor flaws allowed.
The trap
Students think: Any breach voids payment. Wrong, because minor breaches allow for payment minus damages. The actual test is whether the breach is material.
How examiners test it
The MBE loves: contractor finishes but with minor defects. Question: full payment? Trap: thinking defects void contract. Answer: substantial performance allows payment minus cost to cure.
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