If a material breach is not cured, the aggrieved party can elect to treat the breach as total or as partial.
Electing to treat a breach as total will terminate the contract.
Electing to treat a breach as partial will still allow the aggrieved party to withhold its performance until the conditions for it are met, but still obligates both parties to fulfill their obligations.
Restatement Second of Contracts § 242
Circumstances Significant in Determining When Remaining Duties Are Discharged
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In determining the time after which a party's uncured material failure to render or to offer performance discharges the other party's remaining duties to render performance under the rules stated in [R2C § 237 and R2C § 238], the following circumstances are significant:
- those stated in [R2C § 241];
- the extent to which it reasonably appears to the injured party that delay may prevent or hinder him in making reasonable substitute arrangements;
- the extent to which the agreement provides for performance without delay, but a material failure to perform or to offer to perform on a stated day does not of itself discharge the other party's remaining duties unless the circumstances, including the language of the agreement, indicate that performance or an offer to perform by that day is important.
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Restatement Second of Contracts § 237
Effect on Other Party's Duties of a Failure to Render Performance
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Except as stated in [R2C § 240], it is a condition of each party's remaining duties to render performances to be exchanged under an exchange of promises that there be no uncured material failure by the other party to render any such performance due at an earlier time.
Copyright, The American Law Institute