ANTICIPATORY REPUDIATION AND OTHER ASPECTS OF BREACH

B. Hochster accepted: All American jurisdictions except Massachusetts have concurred with the result (though not the reasoning) in Hochster, and allow the victim of an anticipatory repudiation to sue before the repudiator’s time for performance has arrived.

Example: Star promises Movie Co. that Star will act in Movie Co.’s movie, shooting for which is scheduled to commence in the U.S. on July 1. On June 1, Star announces to the press that he is going to live abroad for a year beginning the next day and will not do the movie. Under the rule of Hochster v. De La Tour, in force in nearly all states, Movie Co. can sue Star for breach as soon as he issues his press statement; Movie Co. need not wait until July 1, the time at which Star’s performance is due.

C. What constitutes a repudiation: Sometimes a party will make it perfectly clear that he has no intention of performing the contract. Such a statement will, of course, undoubtedly constitute an anticipatory repudiation. But in other situations a party’s statement regarding his intention or ability to perform will be more ambiguous.

1. Traditional view: Older cases often held that as long as the promisor left any chance open that she would perform, there was no repudiation.

2. Modern view: Modern courts, on the other hand, have generally held that a repudiation can be less clear than this. Thus one commentator defines a repudiation as being any “positive statement by the obligor to the obligee which is reasonably interpreted by the obligee to mean that the obligor will not or cannot perform his contractual duty…” Murray, p. 421. See Rest. 2d, § 250, Comment b. There are three categories of actions on the part of the promisor which may constitute repudiations:

• a statement by the promisor that he intends not to perform;
• an action by the promisor making his performance under the contract impossible; and
• an indication by the promisor or via some other means that the promisor will be unable to perform, although he desires to perform.

3. Promisor’s statement: For a statement by the promisor to constitute a repudiation, it must appear to the promisee that the promisor is quite unlikely to perform, either because he does not wish to or because he will be unable to (a scenario discussed below).

a. Vague doubts: It is not enough that the promisor states vague doubts about his willingness or ability to perform. Rest. 2d, § 250, Comment b. (But even the expression of such doubts may entitle the promisee to request assurances of performance, and the promisor’s failure to give such assurances would be a repudiation. See infra, p. 263.)

b. Grudging willingness to perform: Similarly, if the promisor merely indicates unhappiness about the deal, or a feeling that it is “unfair,” or a wish to get out of it, this will not be a repudiation as long as the promisor either (1) indicates that if legally obligated to do so, he will perform or (2) refrains from any clear indication that he intends not to perform.