Contract 3

Front 1

what's Parol Evidence Rule ?

Back 1

Rule keeps out evidence of what the parties said & wrote BEFORE they reduced the terms of their A to writing

Front 2

what's the reason for parol evidence rule>

Back 2

prevent P from getting in evidence (either oral or written) of a prior agreement that contradicts a later written contract

Front 3

what's the difference between per problem and s/f

Back 3

• A PER problem requires a writing
• A S/F problem involves an oral agreement

Front 4

what's the exception to parol evidence rule?

Back 4

• To indicate a CP to the written contract
• To correct a clerical error
• To establish a defense to the enforceability (formation) of an agreement
• A prior valid agreement incorrectly reflected in the writing
• Collateral agreement
• To explain the written contract
• To supplement a “partially-integrated” writing

Front 5

wants rescission on the ground that K is unenforceable due to misrepresentation, can this get into evidence?

Back 5

yes

Front 6

can you get parol evidence to show what a term means?

Back 6

always

Front 7

what's partially-integrated writing?

Back 7

a final statement of the terms included, but not a complete statement of all terms agreed to

Front 8

if a lease agreement is missing certain terms and doesn’t seem to be complete on its face, can you supplement it with parol evidence?

Back 8

yes

Front 9

if you have a “merger clause” which says “this K is limited to the terms set forth herein, can you use parol evidence rule?

Back 9

then K is considered complete on its face and therefore can’t be supplemented.

Front 10

does Changing an agreement after it has been reduced to writing satisfy the parol evidence rule ?

Back 10

no.
• PER doesn’t apply on oral or written promises that are made after signing the written K! PER looks backwards and has nothing to do with K modification!

Front 11

what's the course of performance?

Back 11

what the parties have done under this K

Front 12

what's the course of dealing?

Back 12

what the parties have done under their earlier contracts

Front 13

what's the usage of trade?

Back 13

what others in the trade do under similar K

Front 14

what can court use the extrinsic evidence as mentioned in the above order?

Back 14

o course of performance
o course of dealing
o usage of trade

Front 15

what's the Seller’s Warranties of Quality in a sale of goods under Art 2?

Back 15

Express warranties that S makes.on facts, promises, or description BUT NOT opinion

Front 16

what's the words that s make on warrant?

Back 16

SELLER DOESN”T HAVE TO SAY “I WARRANT”

Front 17

this desk is solid mahogany. what's this ?

Back 17

Statement of fact

Front 18

“this computer is guaranteed for 2 yrs.” what's this ?

Back 18

Promise

Front 19

what's opinion?

Back 19

phrased in general, subjective or vague language): “all parts are top quality”

Front 20

what's the effect of the seller’s use of a sample or model?

Back 20

gives rise to express warranty→ it warrants that what you get will be exactly like the sample!!

Front 21

what's Implied warranty of merchantability?

Back 21

when any person buys any goods from any merchant, a term is automatically added to the contract by operation of law – that the goods are fit for the ordinary purpose for which such goods are used.

Front 22

what's merchant?

Back 22

SELLER must be a merchant who deals in goods of the kind (

Front 23

if K is silent on quality of shoes and P buys shoe from shoe store， what's the result?

Back 23

There is implied warranty of merchantability

Front 24

if shoe store delivers a van to P, is there implied waranty of merchantability?

Back 24

no

Front 25

in Implied warranty of fitness for a particular purpose, does seller need to be a merchant?

Back 25

no

Front 26

what 's Implied warranty of fitness for a particular purpose?

Back 26

the goods are fit for the buyer’s special purpose

Front 27

what's the key for implied warranty of fitness for a particular purpose?

Back 27

buyer has special purpose; buyer relies on seller AND seller knows it

Front 28

what 's the sign for implied warranty of fitness ?

Back 28

• If the question deals with WHY buyer needs a certain good

Front 29

what's Seller’s warranties of quality in a lease of goods under Art 2A ?

Back 29

The same IMPLIED WARRANTIES exist in lease of goods under 2A as in Art 2 sale of goods.

Front 30

what's the exception for seller's warranties ?

Back 30

• NO implied warranty of merchantability when it involves a finance lease made by Bank

Front 31

Roy leases computer from Citibank, who bought the computer from Gigabyte Computer Co. Is there an implied warranty of merchantability?

Back 31

NO implied warranty made by bank, but implied warranty made by computer co.

Front 32

how can you limit on warranty liability in sales and leases of goods?

Back 32

o Disclaimer of warranties
o Limitation of remedies

Front 33

can you disclaim express warranty?

Back 33

• Seller can’t disclaim an express warranty. S can’t on the one hand make warranties and disclaim them at the same time.

Front 34

can K both say “all parts are guaranteed for 2 years” and “all warranties are disclaimed”?

Back 34

no

Front 35

how can seller or lessor of goods disclaim all implied warranties?

Back 35

with “as is” or “with all faults”

Front 36

if "as is" or "with all faults" aren't used, is the disclaimer good?

Back 36

the disclaimer must be CONSPICUOUS in nature (large print, bold face), then it would be effective

Front 37

what are the 3 Factors on whether limitations on remedies will be enforceable?

Back 37

• you can limit B’s remedies for both express and implied warranties
• test for the validity of any limitation of remedies is “whether it’s unconscionable”?
• unconscionability is measured at the time of K, not at time of mishap.

Front 38

• Where personal injury results from consumer goods, what's the limitation of remedies presumed?

Back 38

then limitations of remedies is presumed to be unconscionable.

Front 39

what's the Seller’s delivery obligation in a sale or lease of goods involving a common carrier ?

Back 39

seller must get the goods to a common carrier; make reasonable delivery arrangements & notify buyer of where the goods are

Front 40

what's the seller's obligation for the destination k?

Back 40

seller must get the goods to where buyer is located

Front 41

FOB (Free on Board) follow by city name other than seller’s city, what's this ?

Back 41

a destination K.

Front 42

o Where goods are damaged before buyer gets the goods & neither the buyer or the seller is to blame, who bears the risk of loss?
• If the seller bears the risk of loss, what does he seller must do?

Back 42

the seller must provide new goods to buyer for NO ADDITIONAL COST or is liable for breach of K

Front 43

If the buyer bears the risk, what does the buyer must do?

Back 43

the buyer must still pay the K price

Front 44

what hierarchy determines who bears the risk of loss?

Back 44

1. Agreement of the parties control
2. Breach: the breaching party is liable for any uninsured loss
3. Delivery by common carrier other than seller: shifts risk to buyer when seller has completed its delivery obligation.
4. If no common carrier (e.g. buyer to pick up or seller to deliver), the answer depends on whether the seller is a merchant
5. If a contract gives the buyer the right to return the goods, the key is whether the buyer is buying primarily for resale or for his own use:

Front 45

Beer Co San Antonio Ks to sell bear to Tex Mex Pub in the Bronx. An electrical shortage caused the beer to spoil while being transported by UPS. K is silent on risk of loss, and neither is to be blamed for the problem. Who bears the risk of loss if the bear was delivered on week after K deadline?

Back 45

o Beer Co. would bear the risk of loss b/c it breached first by shipping goods late.
o If you find anything breached at all → risk is on the breaching party.

Front 46

Beer Co San Antonio Ks to sell bear to Tex Mex Pub in the Bronx. An electrical shortage caused the beer to spoil while being transported by UPS. K is silent on risk of loss, and neither is to be blamed for the problem.
but Seller shipped on time. Who bears risk if it is shipment K?

Back 46

If Seller met its delivery obligations, risk of loss is on Pub.

Front 47

Beer Co San Antonio Ks to sell bear to Tex Mex Pub in the Bronx. An electrical shortage caused the beer to spoil while being transported by UPS. K is silent on risk of loss, and neither is to be blamed for the problem,same facts but destination K.or fob who bears the risk of lost?

Back 47

Then risk remains on the Seller until the beer actually gets to the buyer.

Front 48

if no common carrier, seller is merchant, who bears the risk of lost>

Back 48

seller bears the risk of loss until the buyer takes physical possession of the goods.
(whether buyer is a merchant is irrelevant

Front 49

if no common carrier, seller is a non merchant, when does the seller bear the risk of lost?

Back 49

the seller bears the risk of loss until seller “tenders” the goods (makes goods available – tells buyer where the goods are and where to pick it up).

Front 50

If a contract gives the buyer the right to return the goods, if it is • Sale or return, what rules apply in the risk of lost?

Back 50

same rules apply

Front 51

If a contract gives the buyer the right to return the goods, and the buyer is buying for his own use, who bears the risk of lost?

Back 51

risk remains on the seller until the buyer has accepted the goods.

Front 52

what's the risk of loss in leases of goods?

Back 52

o The lessor bears the risk of loss even when the goods are in the possession of Lessee.

Front 53

Risk of Loss in leases of goods, what if the lessor is a bank?

Back 53

the lessee would bear the risk of loss if the lessor is a bank.

Front 54

what are the points for the Performance of K for the sale of goods (Art 2) ?

Back 54

• Perfect tender rule:
• Cure:
• Installment sales K:
• Acceptance of goods
• Revocation of acceptance of the goods:
• Buyer’s payment obligation

Front 55

what's Perfect tender rule?

Back 55

the standard by which a seller’s performance is measured. Under perfect tender rule, a Seller must deliver perfect goods in the right place at the right time. If not, the buyer has the right to reject the non-conforming goods.

Front 56

does a seller who fails to make perfect tender have an option to cure?

Back 56

yes, It usually depends on whether the time for S’s performance has expired or not.

Front 57

when does s has the option to cure?

Back 57

o S would have the option to cure by the deadline of delivery.

Front 58

when is the exception allowing for option to cure after deadline has past?

Back 58

where there is a history between the parties and the party had previously accepted non-conforming goods

Front 59

what's Installment sales K?

Back 59

look for K language that requires or authorizes the S to deliver the goods in separate installments

Front 60

if the S makes 5 separate deliveries of 4 kegs each is this an installment sales K?

Back 60

need to look at K language.

Front 61

does Perfect tender rule apply to an installment sales contract?

Back 61

no

Front 62

when can b reject installment contract?

Back 62

• B has the right to reject an installment only if there is substantial impairment in the installment that cannot be cured

Front 63

when does b has the right to reject an entire contract?

Back 63

only if a defect in an installment substantially impairs the value of the entire contract

Front 64

when there is Acceptance of goods, what does it mean?

Back 64

we are assuming that K has been formed (this is about performance)

Front 65

does Mere payment for goods without opportunity for inspection qualify for acceptance?

Back 65

no

Front 66

If buyer retains the goods w/o objection after having a reasonable time to inspect them, does buyer accepted the goods? how long?

Back 66

yes. 2 month.

Front 67

what's the effect of acceptance?

Back 67

• once a buyer accepts goods, it is too late for the buyer to reject
• A buyer who accepts non-conforming goods can still get damages

Front 68

can you revoke an acceptance of goods?

Back 68

o General rule: once a buyer accepts, the buyer cannot revoke acceptance

Front 69

when can buyer revoke acceptance?

Back 69

: a buyer can revoke acceptance within a reasonable time after he discovers a nonconformity only if the non-conformity substantially impairs their value and was difficult to discover.

Front 70

what's the requirement for revocation of acceptance of the goods?

Back 70

• Nonconformity substantially impairs the value of the goods;
• Excusable ignorance of grounds for revocation or reasonable reliance on seller’s assurance of satisfaction; and
• Revocation within a reasonable time after discovery of nonconformity

Front 71

M buys home on July 7 & moves in. On Sept 9, it rains for the first time, and M then discovers hairline cracks in the roof. Can M reject? can m revoke?

Back 71

• No b/c M had lived in house for 2 mos and M has impliedly accepted it and it is too late for M to reject, but she can revoke.• Yes b/c 1) the hairline cracks were hard to discover 2) they substantially impair the value of home. M can revoke acceptance within reasonable time after discovering the cracks

Front 72

what's the difference between rejection and revocation of acceptance as to time?

Back 72

Before acceptance After acceptance

Front 73

what's the standard for reject and revocation?

Back 73

Perfect tender
Substantial impairment/difficult to discover

Front 74

what's the requirement for rejection and revocation?

Back 74

• Seasonably notify seller
• Hold the goods for seller
• Follow reasonable seller instructions

Front 75

what's the consequence for reject or revoke?

Back 75

• Goods back to seller
• No buyer payment obligation

Front 76

what's the Buyer’s payment obligation?

Back 76

o Can pay with checks; but S doesn’t have to take the checks, can insist on cash; if S insists on cash, B would have additional reasonable time to get some cash (even if after the deadline).

Front 77

what's the performance standard for common law ?

Back 77

Substantial performance is the standard

Front 78

I contract with Martha Stewart to decorate my house. She finishes the job except for the window treatment in one bedroom. what's the result?

Back 78

• This is substantial performance (did almost everything that she K to do)
• I can still sue Martha for breach of K and recover damages
• BUT I am NOT excused from paying Martha the K price b/c only a material breach will excuse the non-breaching party from performing his part of the bargain

Front 79

when there is material breach in common law contract, what's the result?

Back 79

then I can sue her for damages and I am also excused from paying her the K price. But she can recover in quasi-K for the reasonable value of the work that she has done.

Front 80

when On the NY portion of the bar, if you can recover under QUASI K for the reasonable value of the work, what do i do?

Back 80

put it in the answer → they like equitable remedies.

Front 81

how to determine substantial performance in divisible k?

Back 81

o Substantial performance is evaluated on a unit-by-unit basis b/c in divisible Ks payment is divided up on a per unit basis.

Front 82

if I K with Martha to pay her $9000 a painted cabana for 10 cabanas, and she paints only 3 cabanas. Martha has substantially performed on 3 cabanas , what does martha get under the common law?

Back 82

→ gets $2,700 (on K price).

Front 83

what 's the excuse for any breach is a breach under article 2?

Back 83

any breach is a breach ⇒ if S fails to make perfect tender, B can reject ALL of the goods from S (B is excused from performing)

Front 84

what's the common law material breach rule?

Back 84

i. Damages can be recovered for any breach;
ii. Only a material breach by one guy excuses the other guy from performing;
iii. Whether a breach is material is a factual question

Front 85

what are the factors that a court may use to determine if a breach is material?

Back 85

• Amount of benefits received by the non-breaching party
• Adequacy of compensation for damages to the inured party
• Hardship to the breaching party
• Extent of part performance by the breaching party
• Negligence or willful behavior of the breaching party
• Likelihood that the breaching party will perform the remainder of the contract

Front 86

what's Excuse based on the other party’s repudiation by words or conduct?

Back 86

ANTICIPATORY REPUDIATION or INABILITY TO PERFORM

Front 87

what's Anticipatory repudiation?

Back 87

i. An unambiguous (positive and unequivocal) statement (i) that the repudiating party will not perform; (ii) made prior to the time that performance was due.

Front 88

what's the effect of anticipatory repudiation?

Back 88

Anticipatory repudiation by one party excuses the other party’s duty to perform. It also generally gives rise to an immediate claim for damages for breach unless the claimant has already finished performance.

Front 89

when can Anticipatory repudiation be reversed or retracted?

Back 89

so long as there has not been a material change in position by the other party. If the repudiation is timely retracted, the duty to perform is reimposed but performance can be delayed until adequate assurance is provided

Front 90

if there is anticipated repudiation and executory on both sides, what can the other party do?

Back 90

the other party can sue immediately, rescission, suspension, or urge

Front 91

in anticipatory repudiation, if non- breaching party perform, what can the non-breaching party do?

Back 91

they must wait till after due date of other party’s performance

Front 92

: If I K with Martha to decorate house for $50,000, after Martha starts the job, I tell her that I am not going to pay her for her work , what can she do?

Back 92

She is excuse from performing by my oral anticipatory repudiation and can sue me for breach of K. [Anticipatory repudiation operates EXACTLY Like material breach

Front 93

: If I K with Martha to decorate house for $50,000, after Martha starts the job, I tell her that I am not going to pay her for her work ,I tell Martha 2 days later that I will pay her and that she should resume the work. what's the effect?

Back 93

I can retract my anticipatory repudiation as long as Martha has NOT relied on it.

Front 94

: P Ks to paint O’s house with O in exchange for a unique autographed painting. Before P finishes her painting, O sells the painting to Conviser. Is P excused from continuing to perform?

Back 94

yes

Front 95

what's the Prospective inability to perform ?

Back 95

merely raises doubts about performance; thus, it does not meet the unequivocal requirement of anticipatory repudiation.

Front 96

if there is prospective inability to perform, what can the innocent party do?is other party retraction possible?

Back 96

iii) The innocent party may suspend her own performance until she receives adequate assurances of performance. If these are not forthcoming, she may treat the failure as a repudiation

Front 97

what's a Performance condition?

Back 97

a mutually agreed upon promise modifier. It is language in a K – not merely language in a response to an offer – that does not create a new obligation, but merely limits obligations created by other language in the K.

Front 98

what's Conditional acceptance?

Back 98

the key is where the language of condition appears.

Front 99

what's covenant? does nonperforming of covenant constitutes breach?

Back 99

duty and promise.yes

Front 100

what's the standard for satisfying an express condition?

Back 100

strict compliance with express conditions

Front 101

The contract provides “O’s payment for B’s work is expressly conditioned on B’s using Reading pipe throughout.” B instead uses comparable Cohoe pipe. Has the condition been satisfied so that O has to perform, i.e., pay for the house?

Back 101

no

Front 102

what's the exception for satisfying an express condition?

Back 102

condition based on approval of one of the contracting parties is treated as satisfied if reasonable person would approve, unless subject is art or other matters that are inherently discretionary.

Front 103

How can an express condition be excused?

Back 103

i) Estoppel
ii) Waiver
iii) Failure to cooperate:

Front 104

what's the estoppel for express condition to be excuse?

Back 104

(1) Identify the person who benefits from or is protected by the condition. Then look for a statement by that person giving up the benefits and protection of the condition.
(2) Estoppel is based on a statement by the person protected by the condition BEFORE the condition event was to occur and requires a change of position

Front 105

what's the waiver for express condition be excuse?

Back 105

based on a statement by the person protected by the condition AFTER the conditioning event was to occur and does not require a change of position. A waiver that is not ancillary or collateral to the main purpose of the K shall be treated as a gift and unenforceable.

Front 106

what's Failure to cooperate under the excuse of express condition?

Back 106

a party who wrongfully prevents a condition from occurring will no longer be given the benefit of it.

Front 107

what are the 4 excuse under the contract?

Back 107

Excuse based on the other party’s breach
Excuse based on the other party’s repudiation by words or conduct (ANTICIPATORY REPUDIATION or INABILITY TO PERFORM)
Excuse because of failure of a performance condition
4). Excuse based on a later agreement (5 types)

Front 108

what 's the 5 types of excuse based on a later agreement?

Back 108

• Modification
• Accord and Satisfaction
• Rescission
• Novation
• Excuse based on a Later Unforeseen Occurrence that makes performance IMPOSSIBLE (common law) or impracticable (Art.2) or frustrates the purpose of the performance

Front 109

what's modification?

Back 109

substituted agreement.

Front 110

J borrowed $1000 from R. Later, J and R agreed that R will discharge the debt. NOW if J promises to paint her apartment within 30 days. If J breaches, what's R’s right?can he sue the $1000 debt?

Back 110

. If J breaches, R’s only right is to sue J on the painting deal (not the $1000 borrowed) b/c J’s obligation has been DISCHARGED by the modification A (takes effect immediately).

Front 111

what's substituted performance?

Back 111

accord and satisfaction.

Front 112

what's accord?

Back 112

an agreement in which one party to a contract agrees to accept performance different from that originally promised. An accord does not discharge a contractual duty. It merely suspends the other party’s right to enforce it.

Front 113

what's satisfaction?

Back 113

performance of the accord

Front 114

what's the effect of accord and satisfaction?

Back 114

 the original obligation is excused by accord and satisfaction when the new obligation is performed;
 if the accord is not performed, then the other party can sue on either the original obligation or the accord.

Front 115

J borrowed $1000 from R. Later, if J paints her apartment w/in 30, then R will discharge the debt. if j doesn't pait apartment, what can r do?

Back 115

then R can sue J either on the Accord or the original debt b/c the accord has no long-term effect → will wipe out Joey’s debt only when it is satisfied.

Front 116

what's rescission?

Back 116

cancellation

Front 117

if both parties agree to cancel the K after K is formed， what's the result?

Back 117

then both parties are excused from performing

Front 118

in order for a rescission to be effective, what's the requirement?

Back 118

each party must have some performance remaining → thus if one party has fully performed, the other party can’t rescind

Front 119

what's novation?

Back 119

substituted person

Front 120

what does novation requires?

Back 120

i. Novation requires the consent of all parties; if the non-substituting party is unaware of the substitution, then no novation, it’s a mere delegation of duties and she can sue the old party for breach.

Front 121

if there is a novation, does the old party excused?

Back 121

if there is a novation, there is substitution, then the old party is excused (can’t sue him any longer!)

Front 122

what's the Excuse based on a Later Unforeseen Occurrence ?

Back 122

this makes the performance impossible (common law), impracticable(article 2) or frustrates the purpose of the performance.

Front 123

what's the rule based on a later unforeseen occurrence?

Back 123

 Something that happens after contract formation but before the completion of contract performance;
 that was unforeseen; and
 that makes performance objectively impossible or commercially impracticable

Front 124

in excuse based on a later unforeseen occurrence, if risk of loss must have been allocated to the party seeking excuse either by terms of the bargain or custom of the marketplace,can he be excused?

Back 124

no

Front 125

how do you assume in mbe on later unforeseen event?

Back 125

ii. Always START with the assumption that later unforeseen events don’t matter on the MBE (it’s pretty tough to get out based on impossibility)

Front 126

C K with T to perform in concert hall; hall burns down the day before concert. is c excused ?

Back 126

yes.destruction of hall makes performance impossible

Front 127

if builder Ks to build house for O. Before builder is finished, house burns down. O sues B for breach, does b excused?

Back 127

B is NOT excused, B’s task of building a house is not impossible. (just b/c it costs more doesn’t mean it’s impossible)

Front 128

under article 2, when seller bears the risk of lost, if goods that have been identified and the goods are special in the k and unexpectedly destoryed. is seller excused?what if they are fungible items?

Back 128

yes.the destruction of seller’s quantity of that item doesn’t excuse seller’s delivery of that item.

Front 129

If the buyer has the risk of loss, a later unforeseen event happens, does b need to pay?

Back 129

yes,it’s never impossible for B to pay

Front 130

does Death or incapacity of a person essential for performance bar buyer to sue his estate?

Back 130

yes

Front 131

what does it mean by Supervening government regulation or order?

Back 131

if gov’t ordinance frustrates the K, then party is excused from performance

Front 132

what's Frustration of purpose ?

Back 132

 need at the time of K both parties understood the purpose of the K AND later on an unforeseen event frustrates that purpose

Front 133

If both parties know that K is for viewing of Thanksgiving Day Parade on Thanksgiving morning, what's the effect for cancellation of parade ?

Back 133

frustrate the purpose of K

Front 134

if unforeseen event merely makes K less profitable, does the contract excused?

Back 134

no

Front 135

what's In rem remedies?

Back 135

(“the thing itself”) (rather than monetary damages

Front 136

what's Specific performance/injunction?

Back 136

compelling a party to do what he agreed to do.

Front 137

what shall be satisfied for the purpose of obtaining specific performance?

Back 137

(i) legal remedy inadequate (e.g., the performance is unique);
); (ii) mutuality of performance
; (iii) practically enforceable (iv) no defense to the performance, the contract exists, and conditions precedent satisfied.

Front 138

can real property get sp?

Back 138

yes, always

Front 139

can sale of goods get specific performance?

Back 139

: available only if the goods are unique
(e.g., antique, work of art, custom goods)

Front 140

can service get specific performance?

Back 140

never. but courts can grant injunction to prevent work for someone else, impose negative restrictions on the person

Front 141

what's Reclamation?

Back 141

unpaid seller's right to reclaim goods under Article 2

Front 142

does unpaid seller has right to get the goods back from a buyer that has not paid for them?

Back 142

no

Front 143

when can seller reclaim goods from original buyer?

Back 143

if:
• buyer was insolvent on date it received goods; AND
• falls under 10 day rule