Breach of Third-Party Beneficiary Contract
[1] Elements and Case Citations
(1) Defendant and a third-party entered a valid contract;
(2) Plaintiff is not a party to the contract;
(3) The parties to the contract intended that the contract primarily or directly benefit plaintiff or a class of parties of which plaintiff is
a member;
(4) The contract is breached;
(5) Plaintiff suffered damages as a result of the breach.
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Florida State Courts
Supreme Court: Thompson v. Commercial Union Insurance Co. of N.Y., 250 So. 2d 259, 262 (Fla. 1971).
First District: Clark and Co., Inc. v. Dept. of Insurance, 436 So. 2d 1013, 1016 (Fla. 1st DCA 1983)
Second District: Hunt Ridge at Tall Pines, Inc. v. Hall, 766 So. 2d 399, 400 (Fla. 2d DCA 2000)
Third District: Networkip, LLC v. Spread Enters., Inc., 922 So. 2d 355, 358 (Fla. 3rd DCA 2006)
Fourth District: Jenne v. Church & Tower, Inc., 814 So. 2d 522, 524 (Fla. 4th
DCA 2002);Carretta Trucking, Inc. v. Cheoy Lee Shipyards, Ltd., 647 So. 2d 1028, 1031 (Fla. 4th DCA 1994).
Fifth District: Taylor Woodrow Homes Florida, Inc. v. 4/46-A Corp., 850 So. 2d 536, 543 (Fla. 5th DCA 2003), rev. denied 860 So. 2d 977 (Fla. 2003)
Florida Federal Courts
Eleventh Circuit: Blu-J, Inc. v. Kemper CPA Group, 916 F. 2d. 637, 640 (11th
Cir. 1990)
[2] Defenses to Claim for Breach of Third-Party Beneficiary Contract
(1) Fla. R. Civ. P. 1.110(d) (pleading affirmative defenses), and other
standard defenses See § 60.
(2) Statute of Limitations: § 95.11(2)(b), Fla. Stat. (five years);
but see §95.11(5)(a)(one-year statute of limitation for action for specific performance of a contract).
(3) The contract does not evidence any intent to benefit a third party.
Hollywood Lakes Country Club, Inc. v. Community Ass’n Serv., Inc., 770 So. 2d 716, 719 (Fla. 4th DCA 2000); Canal Ins. Co. v. Hartford Ins.
Co., 415 So. 2d 1295, 1299 (Fla. 1st DCA 1982).
(4) Defendant’s obligation to perform under the contract may be excused under the
doctrine of commercial frustration when the purposes of the contract, or those which defendant bargained for, have become ``frustrated because
of the failure of consideration, or impossibility of performance by the other party’’. See Home Design Center Joint Venture v. County
Appliances of Naples, Inc., 563 So. 2d 767, 770 (Fla. 2d DCA 1990).
(5) Duress requires severe pressure or other influence that destroys the
defendant’s free will, and forces the defendant to do an act or enter into a contract. See Franklin v. Wallack, 576 So. 2d 1371, 1373 (Fla. 5th
DCA 1991) (J. Sharp, dissenting); see also Restatement (Second)
of Contracts §§ 174-177 (1981).
(6) Statute of Frauds: Fla. R. Civ. P. 1.110(d); see also §§ 672.201,
672.206 (Florida U.C.C.), 678.319 (sale of securities), 680.201 (leasing), 725.201 (payment of another’s debt), Fla. Stat; Restatement
(Second) of Contracts §§ 110, 130 (1981).
(7) The implied covenant of good faith and fair dealing requires that each
party act consistently with, and take no actions to frustrate, the contract’s purpose, with the exception that Florida courts will not employ the
covenant to negate a contract’s express terms. Restatement (Second) of Contracts § 205 (1981).
(8) Impossibility of performance is a defense to breach of contract when the
factual situation renders one party’s performance under the contract impossible. See Home Design Center Joint Venture v. County Appliances of
Naples, Inc., 563 So. 2d 767, 770 (Fla. 2d DCA 1990).
(9) Contract enforcement is unconscionable when the contractual term was
unreasonable and unfair (substantive unconscionability) at the time the parties entered the contract (procedural unconscionability). See Kohl
v. Bay Colony Club Condominium, Inc., 398 So. 2d 865, 868 (Fla. 4th DCA 1981), rev. denied, 408 So. 2d 1094 (Fla. 1981); see also §
672.302, Fla. Stat.; Restatement (Second) of Contracts § 208 (1981).
(10) Mistake:
(a) Mutual mistake, which renders a contract voidable when both parties, at
the time of making a contract, were mistaken as to a basic assumption of the contract that has a material effect on the parties’ performances under
the contract. Continental Assur. Co. v. Carroll, 485 So. 2d 406, 409 n.2 (Fla. 1986); see also Restatement
(Second) of Contracts § 152 (1981); and
(b) Unilateral mistake, which allows a party to void a contract when the
party, at the time of making a contract, was mistaken as to a basic assumption of the contract that has a material effect of the parties’ performances
which is adverse to the mistaken party. Orkin Exterminating Co., Inc. v. Palm Beach Hotel Condominium Assoc., Inc., 454 So. 2d 697, 699 (Fla. 4th DCA
1984); see also Restatement (Second) of Contracts § 153 (1981).
(11) Repudiation: An obligee sued for breach of contract may assert the
defense of repudiation when the obligor first repudiated his or her duty of performance. See Southern Crane Rentals, Inc. v. City of
Gainesville, 429 So. 2d 771, 773 (Fla. 1st DCA 1983); see also Restatement (Second)
of Contracts §§ 250-257 (1981).
