One of the most difficult problems in the law of contract is to determine the exact effects of the exercise by one party of his option to rescind a contract in consequence of the other’s breach. The difficulty is exacerbated by ambiguities in terminology; and this fact is well illustrated by the recent decision of the Court of Appeal in Lombard North Central plc v. Butterworth. 1 The case arose out of an agreement for the lease of a computer by the plaintiffs to the defendant for an initial payment of £584.05 and 19 instalments of the same amount payable at intervals of three months. The contract provided that punctual payment of the rentals was to be of the essence of the lease (cl. 2(a)); that in the event of the lessee’s default in punctual payment of any rental the lessor’s consent to the lessee’s possession of the goods was to terminate and that the lessor “may terminate this lease” (cl. 5); and that, in the event of the lessor’s consent to the lessee’s possession of the goods being terminated, the lessee was to pay all arrears of rental, all further rentals which would, but for such termination, have fallen due (less a discount for accelerated payment) and damages (cl. 6). The first two payments of rent were punctually made; the next three were only paid after some delay; and when further delay occurred in making the sixth payment the plaintiffs gave a “notice of termination”2 to the defendant. They claimed “damages”, not under cl. 6, but a sum assessed on the same principle, i. e. consisting of the instalments due at the time of termination plus the unpaid instalments less a discount for accelerated payment and an allowance for the amount that had been realized on resale of the computer. The Court of Appeal held that the delays in making payments did not (apart from cl. 2(a)) amount to a repudiation of the contract; that in the absence of such a repudiation cl. 6 would be invalid as a penalty; but that nevertheless the plaintiffs were entitled to the amount claimed since the effect of cl. 2 (a) was to turn the delays into breaches “going to the root of the contract”3 or into breaches that were “repudiatory”.4 However, this result was regarded by Mustill, L.J., “without much satisfaction”5 and by Nicholls, L.J., “with considerable dissatisfaction”.6 The source of the dissatisfaction (or lack of satisfaction) is that there was “no practical difference”7 between the terms of the contract in the instant case and those in the earlier decision of the Court of Appeal in Financings Ltd. v. Baldock.8 In that case an owner had terminated a hire-purchase agreement under an express provision entitling him to terminate for nonpayment of hire. It was held that he was, in the absence of a repudiation, entitled to no more than the amount of hire unpaid at the time of termination: a minimum payment clause designed to put the owner into the same financial position as that in