Alpha Corp has a contract to deliver 100 widgets to Beta Inc by June 1. On May 15, Alpha Corp informs Beta Inc that due to supply chain issues, they will only be able to deliver 50 widgets by the agreed date and the remaining 50 by July 1. Beta Inc decides to terminate the contract immediately. Which of the following best characterizes Alpha Corp's situation?
Alpha Corp has committed a partial breach.
Alpha Corp has committed anticipatory repudiation.
Alpha Corp's declaration that they will not fulfill the contract as initially agreed before the performance is due constitutes anticipatory repudiation. This allows Beta Inc to treat the contract as breached and terminate it immediately. The other options do not accurately describe the situation: a material breach involves a significant failure to perform which goes to the essence of the contract, a partial breach refers to incomplete performance after the time for performance, and a minor breach is a slight or non-essential failure that does not justify termination.
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What is anticipatory repudiation?
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What differentiates a material breach from anticipatory repudiation?
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What are the consequences of a party committing anticipatory repudiation?