Chapter 89

COL12010618GCA BUSINESS STRUCTURE &FUNCTION CH. 89 EXTINCTION OF CONT RACTS 1CHAPTER 89 EXTINCTION OF CONTRACTS Article 1. How Contracts are Extinguished. Article 2. Rescission. Article 3. Alteration & Cancellation. ARTICLE 1 HOW CONTRACTS ARE EXTINGUISHED § 89101. Contracts, How Extinguished. A contract may be extinguished in like manner with any other obligation, and also in the manner prescribed in this Chapter. SOURCE: CC § 1682. NOTE: No 1970 Civil Code '§ 1683 -1687 existed. ----------- ARTICLE 2 RESCI SSION § 89201. Rescission Extinguishes Contract. § 89202. When may Rescind. § 89203. When Stipulations do not Defeat. § 89204. How Rescission Effected. § 89201. Rescission Extinguishes Contract. A contract is extinguished by its rescission. SOURCE: CC § 1688. § 89202. When may Rescind. A partyto a contract ma y rescind the same in the following cases only:COL12010618GCA BUSINESS STRUCTURE &FUNCTION CH. 89 EXTINCTION OF CONT RACTS 21. If the consent of the party rescinding, or of any party jointly contracting with him, was given by mis take, or obtained through duress, menace, fraud or undue influence, exercised by or with the conniv ance of the party as to whom he rescinds, or

y party jointly contracting with him, was given by mis take, or obtained through duress, menace, fraud or undue influence, exercised by or with the conniv ance of the party as to whom he rescinds, or of any other party to the contract jointly inter ested with such party; 2. If, through the fault of the party as to whom he rescinds, the consideration of his obligation fails, in whole or in part; 3. If such co nsideration becomes entirely void from any cause; 4. If such consideration, before it is rendered to him, fails in a material respect, from any cause; or , 5. By consent of all other parties. SOURCE: CC § 1689. § 89203. When S tipulations do not Defeat. A stipulation that errors of description shall not avoid a contract, or shall be the subject of compensation, or both, does not take away the right of rescission for fraud, nor for mistake, where such mistake is a matter essential to the inducement of the contract, and is not capable of exact and entire compensa tion. SOURCE: CC § 1690. § 89204. How Rescission Effected. Rescission, when not effected by consent, can be accom plished only by the use, on the part of the party rescinding, of reasonable dili gence to comply with the

690. § 89204. How Rescission Effected. Rescission, when not effected by consent, can be accom plished only by the use, on the part of the party rescinding, of reasonable dili gence to comply with the following rules: 1. He must rescind promptly , upon discov ering the facts which entitle him to rescind, if he is free from duress, menace, undue influence, or disability , and is aware of his right to rescind; and, 2. He must resto re to the other party everything of value which he has received from him under the contract; or must offer to restore the same, upon condition that such party shall do likewise, unless the latter is unable or positively refuses to do so. SOURCE: CC § 1691. COURT CASES : Wh ere vehicle was driven 5 or 6 months, and 7,100 miles, after purchase, buyer made timely rescission where vehicle never worked proper ly and was in dealer's shop for much of that time; and court found that buyer would not have COL12010618GCA BUSINESS STRUCTURE &FUNCTION CH. 89 EXTINCTION OF CONT RACTS 3entered into the deal had he been aware of the problems with the car . Quitugua v . Atkins Kroll, 1 Guam R. 190 (D.C. Guam App.Div. 1970). NOTE: No 1970 Civil Code '§ 1992 -1996 existed.

CONT RACTS 3entered into the deal had he been aware of the problems with the car . Quitugua v . Atkins Kroll, 1 Guam R. 190 (D.C. Guam App.Div. 1970). NOTE: No 1970 Civil Code '§ 1992 -1996 existed. ---------- ARTICLE 3 ALTERA TION &CANCELLA TION § 89301. Alteration of V erbal Cont ract. § 89302. Alteration of Written Contract. § 89303. Extinction, Cancellation. § 89304. Extinction; Unauthorized Alteration. § 89305. Alteration, Duplicate, not to Prejudice. § 89301. Alteration of V erbal Contract. A contract not in writing may be altered in any respect by consent of the parties, in writing, without a new consideration, and is extinguished thereby to the extent of the new alteration. SOURCE: CC § 1697. § 89302. Alteration of Written Contract. A contract in writing may be altere d by a contract, in writing, or by an executed oral agreement, and not otherwise. SOURCE: CC § 1698. § 89303. Extinction, Cancellation. The de struction or cancella tion of a written contract, or of the signature of the parties liable thereon, with inte nt to extinguish the obliga tion thereof, extin guishes it as to all the parties consenting to the act. SOURCE: CC § 1699. § 89304.

tract, or of the signature of the parties liable thereon, with inte nt to extinguish the obliga tion thereof, extin guishes it as to all the parties consenting to the act. SOURCE: CC § 1699. § 89304. Extinction; Unauthorized Alteration. The intentional destruction, cancellation, or material alter ation of a written cont ract, by a party entitled to any benefit under it, or with his COL12010618GCA BUSINESS STRUCTURE &FUNCTION CH. 89 EXTINCTION OF CONT RACTS 4consent, extinguishes all the executory obligations of the contract in his favor , against parties who do not consent to the act. SOURCE: CC § 1700. § 89305. Alteration, Duplicate, not to Prej udice. Where a contract is executed in duplicate, an alteration or destruc tion of one copy , while the other exists, is not within the provisions of the last section. SOURCE: CC § 1701. NOTE: No 1970 Civil Code '§ 1702 -1707 existed. ----------COL12010618GCA BUSINESS STRUCTURE &FUNCTION CH. 89 EXTINCTION OF CONT RACTS