Non-performance is failure by a party to perform any of its obligations under the contract, including defective performance or late performance.
This Article defines “non-performance” for the purpose of the Principles. Particular attention should be drawn to two features of the definition.
The first is that “non-performance” is defined so as to include all forms of defective performance as well as complete failure to perform. Thus, it is non-performance for a builder to erect a building which is partly in accordance with the contract and partly defective or to complete the building late.
The second feature is that for the purposes of the Principles the concept of “non-performance” includes both non-excused and excused non-performance.
Non-performance may be excused by reason of the conduct of the other party to the contract (see Articles 7.1.2 (Interference by the other party) and 7.1.3 (Withholding performance) and Comments) or because of unexpected external events (see Article 7.1.7 (Force majeure) and Comment)). A party is not entitled to claim damages or specific performance for an excused non-performance of the other party but a party who has not received performance will as a rule be entitled to terminate the contract whether or not the non-performance is excused (see Article 7.3.1 et seq. and Comment).
There is no general provision dealing with cumulation of remedies. The assumption underlying the Principles is that all remedies which are not logically inconsistent may be cumulated. So, in general, a party who successfully insists on performance will not be entitled to damages but there is no reason why a party may not terminate a contract for non-excused non-performance and simultaneously claim damages (see Articles 7.2.5 (Change of remedy), 7.3.5 (Effects of termination in general) and 7.4.1 (Right to damages)).