Europe
Article 8.105 (ex art. 3.105) - Assurance of Performance 427
1. A party who reasonably believes that there will be a fundamental non- performance by the other party may demand adequate assurance of due performance and meanwhile may withhold performance of its own obligations so long as such reasonable belief continues. 428
2. Where this assurance is not provided within a reasonable time, the party demanding it may terminate the contract if it still reasonably believes that there will be a fundamental non-performance by the other party and gives notice of termination without delay. 429
Article 8.106 (ex art. 3.106) - Notice Fixing Additional Period for Performance 430 see also Remedies
1. In any case of non-performance the aggrieved party may by notice to the other party allow an additional period of time for performance. 431
2. During the additional period the aggrieved party may withhold performance of its own reciprocal obligations and may claim damages, but it may not resort to any other remedy. If it receives notice from the other party that the latter will not perform within that period, or if upon expiry of that period due performance has not been made, the aggrieved party may resort to any of the remedies that may be available under Chapter 9. 432
3. If in a case of delay in performance which is not fundamental the aggrieved party has given a notice fixing an additional period of time of reasonable length, it may terminate the contract at the end of the period of notice. The aggrieved party may in its notice provide that if the other party does not perform within the period fixed by the notice the contract shall terminate automatically. If the period stated is too short, the aggrieved party may terminate, or, as the case may be, the contract shall terminate automatically, only after a reasonable period from the time of the notice. 433
Article 8.108 (ex art 3.108) - Excuse Due to an Impediment 436 see also Mandatory Obligations Remedies
1. A party's non-performance is excused if it proves that it is due to an impediment beyond its control and that it could not reasonably have been expected to take the impediment into account at the time of the conclusion of the contract, or to have avoided or overcome the impediment or its consequences. 437
Where the impediment is only temporary the excuse provided by this article has effect for the period during which the impediment exists.
However, if the delay amounts to a fundamental non-performance, the obligee may treat it as such. 438
3. The non-performing party must ensure that notice of the impediment and of its effect on its ability to perform is received by the other party within a reasonable time after the non-performing party knew or ought to have known of these circumstances. The other party is entitled to damages for any loss resulting from the non-receipt of such notice. 439
Section 2 - Right To Withhold Performance 459
Article 9.201 (ex art 4.201) - Right to Withhold Performance 460 see also Remedies
1. A party who is to perform simultaneously with or after the other party may withhold performance until the other has tendered performance or has performed. The first party may withhold the whole of its performance or a part of it as may be reasonable in the circumstances. 461
2. A party may similarly withhold performance for as long as it is clear that there will be a non-performance by the other party when the other party's performance becomes due. 462
Section 3 - Termination Of The Contract 463
Article 9.301 (ex art. 4.301) - Right to Terminate the Contract 464
1.A party may terminate the contract if the other party's non-performance is fundamental. 465
2. In the case of delay the aggrieved party may also terminate the contract under Article 8.106 (3). 466
Article 9.302 (ex art 4.302) - Contract to be Performed in Parts 467
If the contract is to be performed in separate parts and in relation to a part to which a counter-performance can be apportioned, there is a fundamental non-performance, the aggrieved party may exercise its right to terminate under this Section in relation to the part concerned. It may terminate the contract as a whole only if the non-performance is fundamental to the contract as a whole. 468
Article 9.303 (ex art. 4.303) - Notice of Termination 469
1. A party's right to terminate the contract is to be exercised by notice to the other party. 470
2. The aggrieved party loses its right to terminate the contract unless it gives notice within a reasonable time after it has or ought to have become aware of the non- performance. 471
3.
- When performance has not been tendered by the time it was due, the aggrieved party need not give notice of termination before a tender has been made. If a tender is later made it loses its right to terminate if it does not give such notice within a reasonable time after it has or ought to have become aware of the tender. 472
- If, however, the aggrieved party knows or has reason to know that the other party still intends to tender within a reasonable time, and the aggrieved party unreasonably fails to notify the other party that it will not accept performance, it loses its right to terminate if the other party in fact tenders within a reasonable time. 473
4. If a party is excused under Article 8.108 through an impediment which is total and permanent, the contract is terminated automatically and without notice at the time the impediment arises. 474
Article 9.304 (ex art. 4.304) - Anticipatory Non-Performance 475
Where prior to the time for performance by a party it is clear that there will be a fundamental non-performance by it the other party may terminate the contract. 476
Article 9.305 (ex art. 4.305) - Effects of Termination in General 477
1. Termination of the contract releases both parties from their obligation to effect and to receive future performance, but, subject to Articles 9.306 to 9.308, does not affect the rights and liabilities that have accrued up to the time of termination. 478
2. Termination does not affect any provision of the contract for the settlement of disputes or any other provision which is to operate even after termination. 479
Article 9.306 (ex art. 4.306) - Property Reduced in Value 480
A party who terminates the contract may reject property previously received from the other party if its value to the first party has been fundamentally reduced as a result of the other party's non-performance. 481