R2d § 241
Circumstances Significant in Determining Whether a Failure Is Material
In determining whether a failure to render or to offer performance is material, the following circumstances are significant: (a) the extent to which the injured party will be deprived of the benefit which he reasonably expected; (b) the extent to which the injured party can be adequately compensated for the part of that benefit of which he will be deprived; (c) the extent to which the party failing to perform or to offer to perform will suffer forfeiture; (d) the likelihood that the party failing to perform or to offer to perform will cure his failure, taking account of all the circumstances including any reasonable assurances; (e) the extent to which the behavior of the party failing to perform or to offer to perform comports with standards of good faith and fair dealing.
Professor's notes
Elements (materiality factors): (a) extent to which the injured party will be deprived of the benefit reasonably expected; (b) extent to which the injured party can be adequately compensated for the part of that benefit of which he will be deprived; (c) extent to which the party failing to perform will suffer forfeiture; (d) likelihood that the party failing will cure his failure, taking account of all circumstances including any reasonable assurances; (e) extent to which the behavior of the party failing comports with standards of good faith and fair dealing.
Jacob & Youngs v. Kent (Reading pipe) operationalizes: minor specification deviation; substantial benefit received; large forfeiture if breach treated as material.
Common misunderstanding: students apply only factor (a): "how big is the breach?" The five factors are holistic. Forfeiture (c) and good faith (e) often save a breaching party with substantial performance, even where the deviation is significant.
Cases that operationalize this rule
Text
R2d § 241. Circumstances Significant in Determining Whether a Failure Is Material.
In determining whether a failure to render or to offer performance is material, the following circumstances are significant:
(a) the extent to which the injured party will be deprived of the benefit which he reasonably expected;
(b) the extent to which the injured party can be adequately compensated for the part of that benefit of which he will be deprived;
(c) the extent to which the party failing to perform or to offer to perform will suffer forfeiture;
(d) the likelihood that the party failing to perform or to offer to perform will cure his failure, taking account of all the circumstances including any reasonable assurances;
(e) the extent to which the behavior of the party failing to perform or to offer to perform comports with standards of good faith and fair dealing.