united-states contract-law
What are the different time requirements under law?
<p>I was wondering about the phrase <a href="https://en.wikipedia.org/wiki/Time_is_of_the_essence" rel="nofollow noreferrer">"time is of the essence"</a>. This compares to other time constraints such as "reasonable time" and "time at large."</p>

<p>My understanding of "time is of the essence" suggests that all the deadlines set forth in the contract must be met, that ordinarily, extensions will not be allowed. Is this a correct understanding?</p>

<p>Can "time is of the essence" be inferred from surrounding circumstances, even though it was not "stated" in the contract? For instance, if a "recital" to a contract said that one party needed to complete the deal by December 31, in order to obtain a tax advantage (or avoid a tax loss), would that imply "time is of the essence?</p>

<blockquote>
  <p>Can "time is of the essence" be inferred from surrounding
  circumstances, even though it was not "stated" in the contract?</p>
</blockquote>

<p>Yes, but the key is --as you say-- the <em>surrounding circumstances</em>.</p>

<p>If failure to timely perform the contractual act or duty at issue causes harm, then that failure would merit the granting of a recovery award. By contrast, a delay or failure that is inconsequential would not lead to a viable claim of <em>breach of contract</em>.</p>

<p>Inconsequential failures or delays would not be actionable even if the contract explicit contains the phrase "<em>time is of the essence</em>" or akin thereto.</p>

<p><strong>That is not what <em>time is of the essence</em> means</strong></p>

<p>If a contract has a time by which something must be done and it isn’t done by that time, then that is a breach of a condition of the contract and the innocent party can claim damages. They cannot terminate the contract unless the breach is of a term rather than a warranty. Whether a condition is a term or a warranty depends on the essentialness of the condition and the egregiousness of the breach.</p>

<p>For example, if a building contract says I will pay you on 1 October 2018 and I don’t pay until 30 November 2018 you can sue for damages but you can’t terminate the contract. If it is now 30 November <strong>2019</strong> the breach is probably egregious enough that you can terminate.</p>

<p>“Time is of the Essence” explicitly makes the specified times a term of the contract rather than a warranty. Any breach therefore allows termination.</p>
