i) Breach of contract occurs where there is violation of contractual obligation by failing to perform one’s own promise, by repudiating or by interfering with another performance. Where the party in default repudiates the contract before performance becomes due, the repudiation amounts to anticipatory breach. A breach is said to be fundamental if the promise that is violated goes to the root of the contract and is of relatively major importance to the contract. (4 marks)

ii) The issue identified in the scenario relates to two (2) separate contract made by Essuman, with Odumadze and with Adjei for the benefit of Njama. Both contracts appear to be valid contracts as they meet the requirements of the Common Law; agreement, capacity, intention, consideration and legality. As regards of Essuman’s contract with Odemadze, Odumadze is clearly in breach, after failing to honour his promise to service Essuman’s car. The breach has not only damaged Essman’s car and caused him inconvenience, it also resulted in Essuman losing a valuable client. With regard to Essuman’s contract with Adjei, Essuman has a contract with Adjei, although the benefit is not to Essuman, but to Njame, Essuman’s daughter. It is Njama who is suffering the loss from Adjei’s failure to do the landscaping work at the house where Essuman’s daughter Njama lives. It is to be noted that Essuman and Njama, need to establish that Njama has a special status in the contract, as for example, as a beneficiary of a trust, or in quasi contract, in view of the common law position, that only contracting parties, in this case Essuman and Adjei may enforce it. It must, however, be noted that in Ghana, the relationship goes beyond the classical common law position which limits the enforcement of contract to parties only. In Ghana two categories of persons may sue to enforce a contract, namely (a) a party to a contract, and (b) a person on whom a contract expressly reserves a benefit, a third category is a person who is directly affected by a contract although not a party to it, may rely on the grounds of public policy to have the contract declared void or unenforceable. The statutory intervention that has modified the strict common law is section 5(1) of the Contract Act, 1960, Act 25, which confers the right on a person not a party to contract, to enforce same as though he were a party to the contract. (3 marks)

Available remedies: In the circumstance of this case, the appropriate remedy for Essuman is to sue Odumadze for damages. Damages are a financial award designed to place Esuman in the position he would have enjoyed had the breach not occurred. In the case of breach of contract by Adjei, Njama will not be able to bring action against Adjei on the basis of the common law position that only contracting parties may enforce a contract. Damages in contract is usually to place the innocent party into a position he would have been in were the contract properly performed. Damages are compensatory and are not usually affected by the motive or intention behind the breach of contract. Reliance losses (reliance damages) are damages awarded for losses incurred by the injury party on the contract. Reliance damages restore the injured party to the economic condition the injured party enjoyed before the contract was formed. However, Njama, on the basis of Section 5(1), of Act 25, the contract Act, Njama, may, subject to the provisions of Act 25, sue Adjei for damages for the breach of the contract between Esuman and Adjei, because the contract was for her benefit. (3 marks)