What happens when a contract was signed but a party can't fullfill their oblications due to circumstances outside their control

Question

I know this is a bit of a vague question but I'll give some specific examples. When a contract is signed, and a certain part is not met for extenuating circumstances, when can legal action be taken (and likely won)?

I know of a person who had a contract for a job that started on x start date and y end date and was paid per hour for 38 hour work week. After y end date passed the boss contacted the person saying he hadn't fulfilled his end of the end of deal as he still had 30 minutes of work left to do (presumably this was because he didn't make up for some time he took off when sick and didn't get sick days). Could the boss sue for the remaining 30 minutes?

Also, as in this question, if a formal contract was agreed between a dog owner Bob and a dog walker Alice, that Alice would walk the dog each day for a few weeks for a set amount of pay, what would happen if Alice became sick or the dog wasn't able to go for a walk and nothing regarding these circumstances was written into the contract?

What if someone signed a contract that they would be paid to clean a building but the building burned down before they could do it?

Answer 1

Generally, what you say you will do in a contract is what you must do - there is no "the dog ate my homework" excuse.

For your examples:

1. Employment contracts have so much government regulation that the common law contract is lost in the mists of time. It is unlikely that a court would interpret an employment contract as requiring exact timekeeping; it is also unlikely that the person would have worked exactly 38 hours on every week except the one where they worked 37.5. However, if it were proved that the employee owed 0.5 hours to the employer they could be required to provide it or refund the pay they had received, barring a law that changed this.

2. The dog must be walked. Alice must find a substitute walker if she is unable to provide it. Falling sick is something foreseeable that Alice should have provided for either in the contract ("if I am sick I won't walk the dog") or by arranging for someone else to do it. For purely personal services, falling sick may frustrate the contract, however, dog-walking is probably not personal enough.

3. There is a doctrine which allows termination by frustration where neither party is at fault, however, it is not clear that this would apply. The building burning down is foreseeable and could (should?) have been addressed in the contract. If the destruction of the building was without fault on the owner then the contract is frustrated. If there was some fault on the owner (smoking in bed, inoperative fire alarm etc.) and the cleaner stands willing, ready and able (that is able except for the absence of a building) to perform their obligations, the owner would probably be obliged to pay, at the least for unrecoverable costs (e.g. wages) and loss of profits - if they pay for the cleaning products the cleaner would be obliged to deliver them up.

One of the main reasons for the length of contracts for non-trivial transactions is they deal with these contingencies.

Answer 2

This will depend on jurisdiction. In Germany, this is regulated in the German civil code, the Bürgerliches Gesetzbuch, mostly in § 275 Ausschluss der Leistungspflicht:

Roughly paraphrasing:

• If the service equired in a contract is objectively impossible, the duty is voided. A typical example would be a purchase contract for a specific item, which was destroyed before it could be delivered.
• If the service required would mean a "disproportionate" effort for the party required to provide it, that party has a right to refuse.

However, if either of these situations occurs, the aggrieved party has a right to:

• get back their part of the deal, e.g. be refunded any payments (§326 BGB), and
• receive appropriate indemnification - both for the value of the service or good they did not receive, and to offset any costs they incurred because they relied on receiving the service or good. However, indemnification only applies if the problems were a fault of the providing party (§280 BGB).

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Addressing your examples:

I know of a person who had a contract for a job that started on x start date and y end date and was paid per hour for 38 hour work week. After y end date passed the boss contacted the person saying he hadn't fulfilled his end of the end of deal as he still had 30 minutes of work left to do (presumably this was because he didn't make up for some time he took off when sick and didn't get sick days). Could the boss sue for the remaining 30 minutes?

If the person missed work due to being sick, they would have to make up for it. So, unless there is some agreement or legal rule on how to handle sick time (which is usually the case for regular employees), the boss could indeed claim compensation for the missing 30 minutes. They could claim 30 minutes' pay, but not any additional damages (because it is not the employees fault they got sick).

Also, as in this question, if a formal contract was agreed between a dog owner Bob and a dog walker Alice, that Alice would walk the dog each day for a few weeks for a set amount of pay, what would happen if Alice became sick or the dog wasn't able to go for a walk and nothing regarding these circumstances was written into the contract?

If Alice became sick, then again, Alice would be allowed to not walk the dog, and would not receive pay for that time. Again, no indemnification, because it was not Alice's fault (unless she was to blame for being sick, e.g. because she drank too much alcohol). If the dog wasn't able to go for a walk for an unrelated reason (e.g. the dog being sick), Alice would have a right to receive pay, because she held up her part of the deal (being available to walk the dog).

What if someone signed a contract that they would be paid to clean a building but the building burned down before they could do it?

Again, the contract would be effectively void, and no payment due. Also no indemnification, unless the owner burned down the building on purpose.

Answer 3

It depends on if the contract has what is referred to as a "force majeure" clause, and what the clause covers.

If the contractor agrees to perform X by a certain date, and one of the covered events occurs, then it can free one or both parties of liabilities or suspend fulfillment of the contract until the event is over.

Answer 4

Could the boss sue for the remaining 30 minutes?

No, the thirteenth amendment prohibits this.

However if they were sloppy enough to pay for all 38 hours they could sue to recover 30 minutes worth of pay.