[Music] hey all Professor Tracy back with another contracts video this one on anticipatory repudiation so we're continuing our look at this subtopic of breach and repudiation so remember first we were establishing what the terms of the contract are what those terms mean once we know that we can then know our party's doing what they're supposed to be doing what they committed to doing and that allows us to turn and breach we saw that there are different kinds of breaches that there are partial breaches material breaches and total breaches now we're looking at the question of what's called repudiation which is when a party is indicating before the data performance comes around that they may not perform or and they may flat out say they won't perform so we're going to look at that what how is the other party to respond in that sort of situation what are their rights one of their duties under the contract when the other party is either hesitating is suggesting they may have doubts about performance or uncertainty or flat out saying they won't perform at all so let's jump into that we're going to look at an example and use that to frame our discussion here so let's assume that you and I have a contract and me being me uh you'll see that that may there may be some difficulty for you because of how much I may or may not be willing to commit so here uh I am promising to dog sit for you for the week of June 19th and in return you are promising to pay me 200 for doing so for that one week of watching your dog and uh we know as we've just talked about we've talked about conditions and the Order of performance and because my performance takes a period of time and yours is just the payment of money which can be done more or less instantaneously I'm going to perform first you're going to perform second so I need to go first and so leading up to Performance is this time we're looking at if we're counting out from today uh on if we're going from the date I'm recording this from then uh we we are looking at uh I believe it's the 10th or the ninth I don't even know I have to look but uh if we're looking at this I believe it's the 10th if we're going from April 10th moving forward then June 19th is still a little bit of okay and now we're looking at that time period and so we know that performance is due starting on June 19th and let's say that in May I start making noises as I put it here that I may not perform and what were those noises be well typically it would be me saying well I may have some sort of conflict I'm not sure it's actually going to work out after all I'm not sure I'll still be available those kinds of expressions of Doubt noises of or just complaining of ah I shouldn't have committed that kind of thing and what are your options well one option would be what I titled here is wait and see you can just say I'm gonna wait around and see if Tracy will perform when the 19th of June comes another possibility would be to say you know what I'm just going to treat Tracy as having repudiated despite the fact that we've already made a contract I'm going to assume that these noises amount to a repudiation of the contract and terminate the agreement and hire somebody else to do it another possibility is to request what's called adequate Assurance we're going to explore each of these options in great detail in just a second so let's as we look at these options what do they mean if we start and say well wait and see wait and see if Tracy breaches what does that mean so that is what I described which is to wait and see if I'm going to perform because remember the data performance is still in the future and that's why this whole question of anticipatory repudiation or possible anticipatory repudiation comes about at all is that the party is signaling that they may breach or they may flat out say they will be and but when latency is going you know what I'm going to wait and see and make sure there are they're not going to perform and if that is true then it would just be an ordinary breach right so if you were to wait and for the data performance to roll around and I don't show up then that's just an ordinary breach and you go back to that material we covered about distinguishing between a partial breach and a material breach and all of that but uh so and we wouldn't have to worry about any of this stuff about repudiation so what are the pluses and the minuses of this approach they're probably pretty obvious but one of them is the certainty the positive thing is you as the potentially injured party or potentially non-breaching party that you are the party that you are not jumping the gun if you were to say oh this is definitely a breach he's repuding it and you're wrong because the court doesn't think it's a breach then you your you yourself would be in Bridge so there's not that uncertainty because the data performance would come and it would go and I Tracy would not have shown up to watch her just dog sit for you and therefore you would know for sure that I breached the other side of this is it it is in a sense gracious right that you are giving an opportunity to the other party to correct their own faults so even if I have indicated I don't plan to perform you are still sending Grace to me and you're avoiding litigation and and giving me an opportunity to correct my own wrongdoing on my own that is ideal right but maybe too idealistic if somebody particularly since somebody has said it may have said they won't perform right depending on how certain they are in their proclamations to you so the downside to this is I get out here right you can see the minus there is you may just be wasting your time which is you are waiting around hoping that I will change my mind or being sort of naively optimistic when if I've already clearly signaled I'm not going to perform then all you're doing is wasting your time and putting yourself in this last thing what you can see is you may not be able to get the requested performance at all if you're ready to head out of town on June 19th and only then are you like oh Tracy isn't in fact showing up now you're in a difficult spot because you might have a plane to catch or a cruise to jump onto or whatever and you can't do it because of the fact that you had somebody lined up and you gave me the benefit of the doubt you made your situation worse by waiting around although it's a gracious thing to do it is often a foolish thing but it needs to it will have to uh depend we'll see on how how certain are the signals coming from me the party that's saying you know indicating that they may not perform that's important to know so if I say here right here's if we're continuing with this example and I've changed it see where I say not just that I'm giving making noises I won't perform if I'm saying this I'm not sure I will be able to dog sit for you okay if that's my statement then it may make sense if you choose to wait and see and there that may make sense I'm expressing doubt right I'm saying you know what something has come up I'm not sure I'm going to be able to dog sit for you but I may be able to I'm just not sure so that is not a clear unequivocal statement that I won't be performing it's an indication of Doubt so if you say I will wait and see then you that means you're going to wait and see if I show up when if I'm gonna wait show up on June 19th to dog sit for you and if not then you sue me for breach right because that is just a breach you don't have to worry about repudiation because the date a performance has come I didn't show up and that's a breach so that would be how wait and see unfolds well what about anticipatory repudiation we need to think about how this happens right unlike breach a repudiation is when a party is indicating ahead of time right as we say here before performance is due the party makes an unequivocal and definite statement that they will not perform when performance is going to come due they're saying ahead of time before it's due they're unequivocally and definitely making a statement they'll do it or they're engaging in conduct that renders them unable to perform when the data performance is rolls around so either they're making an unequivocal indefinite statement before performances do or they've engaged in conduct that makes them that makes it so they will they will be unable to perform when performance comes due so what's our analytic framework for anticipal repudiation we're going to ask has the party repudiated if they have we're going to say well what's the rights of the non-reputing party if we're sticking with the example with you and I then I would be the part of repudating if in fact I have then the question would be what rights do you have as the non-repudiating party and then we need to think about though the possibility of retracting a repudiation sometimes a party May repudiate and they may later retract that repudiation we'll see when that can be done and if so how so has a party repudiated the contract we said a repudiation is done in two ways right two ways it's and that we said one it's done before performance is due that it's either an unequivocal indefinite statement or and this is something to keep in mind keep in mind a good faith dispute is not necessarily A repudiation so if the party is bringing up something that in good faith that is a dispute that there's some problem or issue that has arisen as as perform the data performance is approaching or if there's ongoing performance when that performance is expected to be completed that there's some ongoing dispute and there's the possibility of conduct as a repudiation so taking each of these up the timing year the timing with repudiation is it has to be done before performance is due we just said perform when we did wait and see that timing is key because if the data performance has come and gone then that wouldn't be a repudiation if it's before performance is due repudiation if it's when performance is due or after it's a breach so we said we also need either an unequivocal indefinite statement or conduct on equivalent definition meaning what that it needs to be that the party is what they are threatening a material breach when they say something what they're saying is whatever they're saying they won't do is threatening a material breach so keep in mind that means if what they're saying is something like I can match the paint on the wall or on the of your shingles But realize it's technically not the exact same uh same shingle uh coloration or style but unless you're right up on the roof looking at them next to next to each other you won't be able to tell then that's probably not a material breach even though it may be a breach because they're not giving you the right shingle on the roof but if it's if it's what they're saying is this is the way it's going to be I'm sorry then that would be a partial breach is it still a potential breach that they're threatening yes but it could not be a repudiation because what they're threatening to do or telling you they're going to do in a material breach and so mere expressions of Doubt like I'm not so sure I'm going to be able to perform do not constitute a repudiation the person is saying I'm not sure it's going to work out so a statement repudiating must be made directly to the other party this is key if it's said to somebody else and you just get wind of it this does not make it a repudiation you must get it from the other party so and just reading about it in the newspaper will also not be a repudiation right it's got to be a statement from the other party made directly to you so not through another party not through another medium like a newspaper so you've got to get it directly from that person and we'll see that this is different when we start thinking about adequate Assurance which is of one of the other possible responses to when there is a situation where one party is expressing they may or may not perform so one of the things I said is we said okay there's the timing of a repudiation has to be before performances due if they're making if the repeat if the repudiation is done through words it has to be a clear and definite unequivocal statement and we said that it that statement it has to be of a material breach and coming directly from the other party and the if what the person is Raising is a good good faith dispute then that is not a repudiation repudiation means you're acting in bad faith you're refusing to perform so that's important to keep in mind so conduct is also a repudiation so realize a good faith dispute what you might say well what's that what do you mean that if there's some genuine dispute say uh that you and I are nailing down say exactly if I'm dog sitting for you maybe there is some dispute about well I'm supposed to be going away to help my mom with something and I had told you I I think I'd like to take the dot and my plan would be to take the dog with me you have concerns about that and we have a little bit of dispute whether that's going to work out or not that is a good faith dispute about that part of the job that is not a repudiation just because you and I are having a disagreement about some part of the job so here conduct as a reputation there there's somebody shooting themselves in the foot that's what we mean here where someone is engaging in conduct right that they are making their their performance impossible so ahead of time they're doing something that makes it impossible for them to perform when the data performance rolls around and so that's in a repudiation although it's not words it's not a definite non-equivocal statement through their conduct they have made it so they cannot perform so we've looked at this question of repudiation what are the rights of like has the party repudiated we've talked about how that might be so what are the rights of the number if there is a repudiation what does it look like so the non-repudiating party May what suspend their performance they can they can terminate the contract if they want and they can sue for rage that should sound familiar it should sound like a material breach that if that's that's matured into a total breach such the contract can be terminated without liability so if in fact the party has repudiated then you can suspend your performance you can give the party time to retract that repudiation and but you don't have to you can suspend your performance terminate the contract super breach if you want remember you don't have to sue you can just say I'm walking away I'm just going to hire somebody else to dog sit for me I'm not interested in pursuing a lawsuit but you could if you want to because it's the equivalent of a breach if I repudiated and so here right you're not required to terminate you're not required to um it to sue so here where I say I said just mention you're not required to sue not required to terminate either you could sit back and hope that they're going to change their mind give them a chance to change their to retract their repudiation and to uh to perform so you could do that but obviously there are potential downsides much like the wait and see approach so what how does somebody retract their repudiation a retraction of repudiation a repudiating money to try to do this what they made me attract any time before performances do however however this is key that the right of retraction is going to terminate right you have the retracting party or the reputation party has a right to retract that repudiation anytime prior to Performance unless the other party what they give notice that they're terminating right they give notice they're treating the contract as rescinded or terminated that they're treating this as a breach and they're suing right that's a repudiation they can say I am suing on this so they're giving notice that they're terminating the contract if they're suing on the contract or that they materially change position whether they give notice of that or not what would that look like you hire somebody else to dog sit for you it would make sense on your end to go ahead and give notice you're terminating and then to hire to be safe but you can just materially change your position and you no longer have a right to retract that should make sense right if if I if you have relied on my repudiation by changing position then at my right to retract should be gone and that's the case so what about repudiation the positive here is you are not the problem with wait and see was you're wasting time and potentially putting yourself in a position where performance may never happen right may never happen and the positives obviously with the repudiation are just the opposite if I treat this if I say no you've reputed I treat it as anticipatory repudiation then I'm not wasting my time or my resources I'm saying I am suspending my own performance I'm terminating the contract and I'm suing if I want to then I'm not I'm not waiting around for a performance that may overcome and I'm also I'm I can seek out somebody else to if it's you you can seek out somebody else to dog sit for you so you're not in a bind if I don't show up obviously it's potentially risky you might say well why because you are reading the other party they're either their conduct or the statement that they have made to you and you are going in my assessment this is a definite non-equivocal statement that they will not perform and you're also saying I don't think whatever dispute is here is a good faith dispute you're making a bunch of judgment calls about what you think the result should be and so but you might be wrong uh because you are in the thick of things and you have your own opinion about how right I am or the other party is and how wrong you may feel you feel you've been wrong by them and therefore you may not be seeing things clearly and you look at it and go it's a repudiation which means what if you go ahead and go I am suspending my own performance I am terminating my the contract and walking away or suing then guess what if you were wrong you yourself are in breach you yourself are the wrong doer and that is a bad thing the other thing obviously is it forces you to go back to the drawing board and find somebody else you could say if we view being gracious as a positive thing it removes that possibility of sort of a change of heart a repentance from the other party and them sorting it out that's removed so if we look and go okay I if this is the situation if I've said this statement to you read read it here don't go I've seen this before your ugly little diagram before here Tracy well no not quite not this one so this one says I quit I'm not gonna watch your dumb dog for you okay there that is a definite and unequivocal statement I'm not going to watch your dumb dog for you but we made a contract way back here right on the 10th we said we have a contract and but in fact I'm going I'm not going to be there I'm not going to watch your dog so you go well that's that's a repudiation and if that's true that's it you terminate the contracts suspend performance ensue and in this case you're probably right because my statement seems pretty definite and unequivocal right realize that it would be clear now keep in mind here I would have a right to retract my repudiation right because people don't usually do all three of these things immediately um you hypothetically could but you in unless and until you hire somebody or you give me notice if that you've you are terminating the contract um that and or remember that you have to either give me notice you've terminated the contract and notice that you're suing on the contract or you materially change position find somebody else otherwise I would have a right to retract my repudiation so for thinking about doing just looking at some basic multiple choice questions from the materials that I use for my own students saying uh it occurs when well we know this we know that it's before performances due right so not very difficult this is a straight sort of recall question doesn't require a lot of analysis a party May repudiate a contract how it says by words only only in writing either by words or conduct would write realize the words don't have to be in writing so this is this is there's sort of a false dichotomy at work in some of these answer choices here it it's done it's either done by words or by conduct right so C would be the correct answer there the words can be oral they can be written don't matter so so what about three three says upon repudiation the non-repudiating party has the right to do what well we've said this right they can suspend their performance they can terminate the contract they can sue for breach they can do all of those things and it says the repudiating party has a right to retract the repudiation up until the non-reputating party does what he gives notice that the contract yup that's true that would cut off the right to retract the repudiation treats it as a breach by bringing suit yep that would that would cut off the right although obviously there's supposed to be notice there but that's sort of inherent if I'm bringing a lawsuit that presumably you're getting notice of that I'm serving you with it um and or I materially change it but you materially change the position relies yes all of those we love those all of those any of those would terminate the right to retract the repudiation and now we have this question it says buyer and seller enter into a land sale contract where the delivery of the deed to the land free of any encumbrances and payment of the purchase price is to be one month after signing the agreement okay so they enter into it we have a delay obviously there wasn't delay then reputation is not an issue right if everything happens right after the contracts form there's gonna be time for anyone to repudiate but here it says they format performances a week later a week a week after the the buyer and the seller earned the contract seller uses the land as security for a hundred thousand dollar loan which is due in six months okay did Zilla repudiate the contract by mortgaging the property explain your reasoning well they have three weeks to unmortgage the property and here this is difficult right because you could look at this right and say well yeah but they could still perform they could still make it do but if they've promised to deliver it free of any encumbrances then they put themselves in a spot where it indicates by their conduct right not by anything they've expressed to the buyer but by their conduct is it impossible no so we could say well Tracy your slide said it had to be impossible is it impossible no but it is conduct that indicates that they they are not in a clear position to perform three weeks later if in fact this and we'll see this is where the next option might be the ideal option because this is a situation where you're like I really think you may not be able to perform uh given what you've done it seems like if you didn't have the money and you needed to put this aside to secure a loan for that it's going to come through six months from now then that greatly concerns me here um if you would probably want more facts as I've said here you this is likely you could probably treat this as a repudiation that it probably constitutes a repudiation here um by conduct but we'll see that maybe the next option of what's called seeking adequate Assurance might be the best although three weeks is not a lot of time so here employer employee enter into an agreement where employer will work at employer's office for six months starting in one week the the day after making the agreement employee embarks on around the world cruise that will last one year employer sees employee get get on the ship and watches the ship leaves the dock with employee waving goodbye from the deck of the ship as employee repeated the contract to explain your reasoning this is pretty straight forward right for um they're going to they're supposed to start work in one week but this employee just got on around the world cruise that um is going to last a whole year so this is not going to happen right they're not able to start the job in one week so this one's much clearer than the other one uh this is this is a clear repudiation right so this being our answer here that this is a clear repudiation right it's a year-long voyage that by their conduct they've made it impossible for them to perform so this is straightforward repudiation by conduct so we're at seven seven says on July one buyer and seller into a contract for the sale black acre for 150 000 with a closing date of October one on August 1 buyer tells seller he thinks he made a mistake and the block acre is not worth a hundred and fifty thousand dollars buyer asked seller reduced the price by ten thousand dollars seller refuses on September one buyers send seller an email stating you are asking too much for a black acre I'm not going I'm not buying it for a hundred and fifty thousand dollars and will not be at the closing unless you lower the price by ten thousand dollars seller makes no response on October 1 buyer does not show up at closing when would have been the earliest that seller could have brought a breach of contract lawsuit well here when if we're looking at this they make a contract right it says on July 1 they make this contract on August 1 what we have is buyers saying I think I made a mistake that the property's not worth them buyer then ask in that same communication hey would you reduce the price by ten thousand seller says no they're not obligated to drop it they already have a contract so a month later buyer then says you're asking to Mage I'm not buying it for 150 000 and will not be at the closing unless you lower the price by ten thousand now we have a definite unequivocal statement that the person is not going to perform as agreed and unless they do the by the seller gives into something they don't need to give in to they don't have to lower the price they already have a contract so I would say the Sooners would be September one when we have that so that would be it right September one so that would be the date of the repudiation and at that point this realized the seller could suspend their performance terminate the contract and immediately sue for breach so what about this last option I referenced particularly in response to a situation where person encumbers the property it's not technically impossible for them to perform but it sure raises a lot of questions and we said there's this problem potential problem with anticipudiation when if the non-repudiating party moves forward when they have they are not necessarily reading the situation clearly that it's not as definite and unequivocal as they think or that conduct is not so clearly put the other party in a position where it's impossible for them to for to perform when the data performance rolls around so what do they do so whether we're under the common law or the UCC you may ask for adequate Assurance when the standard for adequate Assurance is you have to have reasonable grounds for insecurity reasonable grounds for insecurity so with a repudiation you have to either have definite and unequivocal statement that the party's not going to perform or you have to have conduct that the party's engaged in that makes it impossible for them to perform when the data performance comes around but to request adequate performance adequate Assurance all I need is reasonable grounds for insecurity so what are we asking we need to know when we're thinking about this does the party actually have reasonable grounds for insecurity and if they can't if they do then that gives them grounds for demanding adequate Assurance but have they done so have they made a demand and then if they have has the other party provided adequate Assurance of performance adequate Assurance of performance so does the party have reasonable grounds for insecurity well how do we know what is it if the the party has a belief that the other party will breach and that it's reasonable in light of the particular the the facts and the circumstances of the particular case and realize the facts that they're pointing to to say I have reasonable ground certain security must have Arisen after formation because if they existed at formation you should have addressed them before you entered into the agreement or as part of the negotiation process leading to the agreement so we can't you can't later you you know go back to those facts and go well still feeling real and secure well if you did you did you should have dealt with it but if something happens later then that gives you grounds for demanding adequate assurance so these are tied right if it's a risk I took when I formed when I entered into the agreement then I can't use that now to demand adequate assurance and that should make sense so when this is a big one if you find out the other party is having financial troubles you see they file for bankruptcy you see that they've made some sort of announcement and their stock is starting to tank that they're because of their financial position you find out something about it you might be like but Tracy you said that repudiation can't come from a third party it has to come directly from the other party I did but guess what can come from a third party Source the grounds for demanding adequate Assurance I can have reasonable grounds from insecurity just by reading about something hearing about something talking to somebody else and so that's okay so things like financial trouble or somebody he's labor strike or they have some sort of there's a shortage of essential supplies that arise and why you might say well why are those how does this all fit in because they make me think you may not be able to perform you've encumbered the property to with a hundred thousand dollars worth of debt that you're supposed to give me in three weeks debt free that gives me some grounds for insecurity because I don't know because if you needed to secure it with that property for the to begin with that gives me a lot of doubt about whether you can pay it off in three weeks so here indirect communication as I just said the grounds for insecurity it may be indirect but if it's you're talking about repudiation it must come directly from the other party so there is a difference there right has the party made a demand for adequate Assurance of performance the answer here is how do you how do you do this you suspend your performance you demand adequate Assurance the form of demand it this is important to understand that it will differ depending on whether we're Under the UCC or the common law under the common law it doesn't specify the restatement does not say but Under the UCC it says it must be in writing it must be in writing so if you lack a basis right if you so that what is this getting on here is if you actually don't have reasonable grounds for insecurity and you suspend your performance and demand that the other party provide adequate Assurance you yourself are in breach by doing so because you're not acting in good faith right you you have no basis for suspending your performance and demanding and that they assure you that they're going to be able to perform so here what about this has the other priority provided adequate Assurance what does that look like what is adequate Assurance well if the other perverty gives adequate Assurance then everything just carries on merrily right like oh my concerns are relieved I see that although you've had this financial hiccup you're actually fine this contract's going to be performed A-Okay if it's not given if they don't respond at all which is a frequent thing if somebody is a frequent thing that a party will do if they can't provide any adequate Assurance then they're going to try to ignore it right they will often try ignore not always but that there are you can find plenty of cases where that's what happens and so there it's pretty easy to say did they provide adequate insurance no they didn't respond at all so that is so either if it's provided and it's just not adequate which talk about in a second or they don't respond at all then that means that will be treated as a repudiation right once you ask for adequate assurance and the other party doesn't provide it that is a repudiation so that's remember this is predicated on our step of well did the party actually have reasonable ground certain security they had to otherwise they the other part if you did not have that then there would be no grounds for asking for them what is adequate it's a question of fact so we have to decide what's going to solve their insecurity so the party demanding it has to go what would solve my insecurity I am feeling insecure about what why and what would help to make clear that out if it's Financial condition then maybe it's looking you know them providing their you know access to financial documents or things or you know bank account balances or other things that would assure you that they're able to provide that they're going to be able to perform if it's a labor strike then it may be something you know an indication to you of this is going to resolve quickly here's why we think that or you know here's we're actually bringing other workers in um to cover while these people are striking and so no worries there's not going to be a lot of downtime whatever it may be and so that's here we're going the party getting it and receiving is the one deciding if it's adequate now it here the thing that's obviously not adequate is somebody going don't worry I'll perform it's going to be okay it's got to be that you are doing that usually just a verbal Assurance or written Assurance is not okay now I guess there could be circumstances where it might be depending on the specific facts of the case and the relationship between the parties but in a lot of cases the answer is going to be no I need something more than a don't worry it's all going to be okay it you know I'll perform I know you read we file for bankruptcy but don't worry we're good so that you need something more than that and so if we look at this what's an example of what's adequate so if we look at this and we'll obviously go back to the dogs in the exam in a minute but if you and I we can track for me you're going uh I'm going to buy your home for four thousand dollars or four hundred now four thousand that'd be quite probably not quite much of a home but you're in law school right a four thousand dollar loan might be all you can afford um so you hear what that I am in having financial difficulty that I've defaulted on several my debts say outstanding loans credit cards whatever it may be and you then request adequate Assurance from me I provide verified financial statements showing here's my available funds right so here's my account balance here's what's available here's what I'm covering and not what you've heard is not you don't really need to be concerned about remember it doesn't matter that it's incorrect that so you had reasonable grounds for insecurity if you got wind that I was defaulting on these on debts so you that will cause you to think I want wonder if Tracy can actually afford to buy a four thousand a 400 000 home so those are all valid things so it seems like this works out fine so as we think or what are the plus minuses of demanding adequate Assurance there's a lot of good things right because one of the good things about it is you are it's eliminating this risk of breaching although not entirely right because if you don't in fact have reasonable grounds for insecurity then you you put yourself in breach if you suspend your performance and demand out of insurance but it avoids this jumping straight to saying oh there's repudiation it allows you to go I'm not feeling good about what I have found out or what seems like that the other party may not perform or the doubts they've expressed to me so I want some assurance that they're actually going to perform and that's the beauty of it and it allows you to seek this right and allow something it allows you to move things forward to get a resolution rather than just waiting around so it avoids sort of the extremes of both of the other the wait and see approach and sort of and jumping right to reputation now keep in mind do not read me to be saying you never treat something as a as a repudiation right away no you absolutely do because sometimes it absolutely is a repudiation and sometimes it's absolutely clear that you should probably cool your pets and not do anything and just kind of wait and see you know the person's whatever complaining they're hemming and Hauling they're expressing uncertainty but it's best to just sit back and cool your pits for a minute and see what happens before you plow ahead with doing anything one way or the other so that so but this is a middle ground if you're in a situation where like ah I'm not aware it's very clear that the person it's not clear right you the problem here is even if you do get adequate assurance that doesn't guarantee performance that's all this negative is saying right not none of this is a guarantee well at one way or the other right and the it's possible that you misjudge as I mentioned up front you you still need to be sure that you had reasonable grounds for insecurity so you still couldn't misjudge but it is it is much less of an extreme thing than terminating the agreement ensuing so if we go back to my example if I say to you my statement isn't I'm not going to watch your dumb dog but my mom is sick I may need to go see her it could end up being the week of June 19th okay I've raised to you something which is like I don't know this is a concern I may need to go deal with her right you say well I want Assurance I if you're gonna you know you've caused me concern I have reasonable ground certain security and I have sewed those those doubts in your mind and so if I say to you right you asked Tracy to confirm that he will not make plans to visit his mom the week of June 19th and I provide you with a copy of my plane ticket showing I'll be traveling the week of July 3rd right so not till July will I be going so I say yep I get it here's the Assurance you don't need to worry I'm gonna be there I haven't you know booked my travel here in a way that's going to conflict so that would be the kind of resolution of everything there if instead right I could I could provide the adequate Assurance or I could not if I refuse as this says then that would be a repudiation right you could terminate you could terminate the contract then and you could Sue right you could terminate the agreement suspend your performance terminate the agreement sue if you want to and you would want to do one of those things and provide notice or change your position in order to cut off my right to retract which of the following is the most accurate statement concerning adequate Assurance of performance so adequate Assurance remember that this is obviously directly wrong you have to have reasonable grounds from security and here you have to have a good faith basis before suspending right so C seems like the right answer meaning it can't just be either you're overly insecure like you're overly sensitive or that you're making something up and just being difficult but that you have actual good faith basis for your reasonable grounds for insecurity so that's it I hope that's helpful um so keep in mind if you don't look at that and go wow again that one approach is always you preferred to another that you want to look at what the facts call for and any of those approaches May or might may not be applicable depending on how things unfold but I do hope that's helpful and as always if it was it's very helpful if you like And subscribe and I will be back with more videos moving forward we're going to be moving into remedies uh in the next couple weeks so everyone is doing well and uh there'll be more to come bye