Also known as: ex-contractu · contractual obligation · ex contractu liability
Written by attorneys — see sources below.
An obligation or cause of action founded upon an agreement between parties. The phrase distinguishes duties that arise directly from contractual promises from those imposed by law independent of any agreement.
Ewan Eckhart and Elena Estrada form a general partnership under a written agreement that sets specific benchmarks for evaluating performance of duties. When Ewan withholds information about a potential deal, Elena claims breach. The court measures the claim by the agreement's prescribed standards rather than an external rule.
Everest Holdings and Echo Systems form a limited partnership whose agreement defines reasonable timelines for capital calls. When a general partner delays a required contribution, the limited partner sues for breach. The court applies the agreement's standards to determine whether the delay violates the duty.
Elijah Edwards and Evelyn Ellison operate a general partnership. Edwards withholds financial records despite an express provision requiring prompt disclosure. Ellison sues for breach. The court enforces the duty because it arises from the partnership agreement itself.
Eduardo Enriquez serves as a limited partner in a venture with Elysium Media. The operating agreement requires him to approve certain distributions within ten days. When Enriquez refuses without cause, the general partner sues. The court treats the refusal as a breach of the contractual duty created by the agreement.
Edgar Evers acts as general partner for a limited partnership that includes Equinox Energy as a limited partner. The agreement obligates Evers to obtain consent before selling a key asset. Evers completes the sale without consent. Equinox Energy sues, and the court enforces the duty created by the agreement.
An employee sues a former employer for termination after refusing to falsify records. The complaint alleges breach of an implied promise in the employment agreement. The court classifies the claim as arising from contract rather than an independent legal duty.
Interactive Data Corporation hired John Foley in June 1976 as an assistant product manager at a starting salary of $18,500. As a condition of employment Foley signed a confidential and proprietary information agreement. The company's president told Foley that if he performed his job well he would have a long and rewarding employment with the firm. Over the next six years and nine months Foley received steady salary increases, promotions, bonuses, awards, and superior performance evaluations, rising to branch manager of the Los Angeles office with an annual salary of $56,164 plus a merit bonus. In January 1983 Foley learned that his new supervisor, Robert Kuhne, was under investigation by the FBI for embezzlement from his former employer, Bank of America. Foley reported the information to Vice President Richard Earnest because he was worried about working for Kuhne in a supervisory position. Earnest told Foley not to discuss rumors and to forget what he had heard. In early March 1983 Kuhne informed Foley that the company had decided to replace him for performance reasons and offered a transfer to another division. Foley was later told he could continue as branch manager if he agreed to a performance plan, but when Kuhne met with him the next day Kuhne instead gave Foley the choice of resigning or being fired. Foley was discharged on March 13, 1983. Foley filed suit against Interactive Data Corporation alleging three causes of action: tortious discharge in violation of public policy, breach of an implied-in-fact contract to terminate only for good cause, and tortious breach of the implied covenant of good faith and fair dealing. The superior court sustained the company's demurrer without leave to amend and dismissed the action. The Court of Appeal affirmed the judgment. The Supreme Court granted review.
View caseEx contractu identifies obligations that arise from the parties' agreement itself. Ex delicto identifies duties imposed by law independent of any contract, such as the public-policy duty not to discharge an employee for refusing to commit a crime.
A partnership agreement may prescribe the standards by which performance of the obligation is measured, provided those standards are not manifestly unreasonable. The agreement cannot wholly eliminate the obligation.
The duty is contractual in nature and must be discharged consistently with the obligation of good faith and fair dealing that the statute incorporates into every partnership agreement.
The partner must contribute money equal to the value of the undelivered contribution at the partnership's election, because the duty to perform the contribution promise is an obligation arising from the partnership agreement.
…may furnish a basis for the relief. But the defendant and its subscribers, unlike members of the Associated Press, were under no contractual obligation to disclose the source of the news; and there is no rule of law requiring acknowledgment to be made where uncopyrighted matter is reproduced. The International News Service is said to…