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69 Cards in this Set
- Front
- Back
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Was there a valid offer?
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Commitment, communicated to an identified offeree, with certain and definite terms
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Land Contracts
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Offer must describe property and price
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Sale of Goods
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Offer must describe quantity and goods involved
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Exception to quantity requirment
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Output and requirement contracts
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Service K
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Offer must describe duration and nature of services except to no duration for terminable at will
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Vague or Ambiguous material terms
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no offer bc no commitment
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Irrevocable offer
Merchant's firm offer under Art. 2 |
Merchant is someone in biz of buying/selling goods of the type involved
Offer cannot be revoked if made by merchant, in writing, signed & says will be held open for some period or indefinitely -if no consideration and no time stated its open for 90 days |
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Irrevocable offer
Enforceable option K's |
When offeror promises to keep offer open and offeree gives consideration for promise
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Irrevocable Offer
Offeree foreseeably relies on offer |
Subcontractor offer irrevocable for reasonable period of time
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Irrevocable Offer
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Offer to make a unilateral K if performance has begun
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Offer for unilateral & bilateral k defined
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uni: calls for acceptance only by performance
bi: calls for acceptance by return promise, expressed or implied |
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Indifferent Offers and offers that say can accept by promise or performance, both result in bi K's
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Indifferent may be accepted by promise or beginning performance
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When are offers for uni K's not revocable?
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1) when performance has begun
2) when offeree's reliance n offer was reasonably foreseeable to offeror 3) when K is divisible & some divisible part has bee performed |
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Acceptance for bi K
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What, how, when
1) commitment 2)communicated by proper method |
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Mailbox Rule
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If offeree communicates by a proper method, prepays delivery charges & properly addresses acceptance it is effective on dispatch BUT exceptions
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Exceptions to Mailbox Rule
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1) if offer says it doesn't apply
2) if offer suggest method of communicating & different but reasonable method is used 3) if offer pursuant to option K 4) offeree dispatches acceptance, then sends rejection. The acceptance is effective upon dispatch unless offeror receives the rejection first & acts in reliance on it 5) sends rejection first then acceptance. Acceptance is effective upon receipt if it beats the rejection. If not, acceptance is only a counter offer. |
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Acceptance by silence
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1) if offeree suggests it as method of acceptance or
2) if course of dealing between parties that creates a duty on part of offeree to object if he doesn't accept |
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UCC for bi K
Acceptance by beginning performance |
1) if perforamnce has begun but completion will take time ex: shipment takes time to reach buyer, offeree must give notice performance has begun
2) Any performance accepts offer except: sending nonconforming goods is acceptance unless seller clearly indicates goods are sent merely as an accommodation to buyer, rather than as acceptance this =counter offer |
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CL Mirror Image Rule
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acceptance must be mirror image of offer. any change or addition is a counter offer
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UCC Battle of the Forms
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A reply to an offer which changes or add terms is an effective acceptance unless
a. seller sends nonconform. & indicates being done as accommodation b. no expression of acceptance c. words of aceptance, but they are expressly conditioned on original offeror agreeing to accept new or different terms |
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UCC Battle of the Forms if accepted but new or different terms
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1) K contains all terms common to both
2) if not merchants, new or diff terms are part only if offeror agrees 3) if merchants, new terms are part unless 1) offer stated to contrary, 2) terms are material alteration 3) offeror objects w/iin reasonable time |
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UCC Battle of the Forms if accepted but different terms
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split of authority if both merchants:
some treat like additional some use knocked out and gap fillers |
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3 Requirements for Consideration
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1) bargained for exchange 2) legal detriment 3) if consideration is a return promise, it must not be illusory
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Preexisting Duty Rule
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promise to perform or the performance of something one already was obligated to do is not consideration
-if PED are discharged, rule inappliable |
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UCC Consideration Substitutes
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a. Merchants firm offer not needed
b. Mod of an existing K c. Promissory Estoppel |
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Promissory Estoppel
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A promise is enforceable when it induces detrimental, reasonable and foreseeable reliance
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K's covered by SOF
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1. Marriage Ks
2. Suretyship K's appplies to collateral promise not made primarily for promisor's personal benefit ex: promise to pay if primary debtor does not 3) land k's where interest lasts more than 1 year 4) Service K's not capable of complete performance in 1 year. Applies only if at date of formation there was no logical possibility to complete performance w/in 1 year of that date 5)UCC-K for sale of goods for $500 or more |
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UCC exceptions to SOF
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a. specially manufactured goods not readily resaleable. Once seller has started manufacture or purchase goods for buyer, oral k is enforceable
b. Merchants confirmatory memo-signed & states quantity, if no object w/in 10 days SOF is satisfied c. Judicial admission |
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Evidence necessary to satisfy SOF
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1. Writing: CL: signed by party to be charged & identify parties, subject matter, consideration & other important terms & conditions
UCC: signed by party to be charged describing goods and quantity |
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Part Performance of Land or Sales K & full performance of Service K
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if there si performance, some oral k's will be enforced to extent of performance
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Unconcsionability
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Procedural: unfairness in bargaining process
Substantive: K contains a terms that is unreasonably one sided or contrary to public policy. 3 step analysis: 1) is there a 1 sided term? 2) IF so, does it protect a legit interest 3)if so, is it a reasonable way to protect it or does it go beyond? |
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Mutual & Unilateral Mistake of Fact
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No defense if assumption of risk
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Parol Evidence Rule
Integrated Agreements |
where writing is final expression, no evidence of conflicting terms in a prior or contemporaneous oral or written agreement admissible
-where writing is final, but not complete cannot contradict but is admissible to add a term |
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Parol Evidence Rule
Completely Integrated Agreements |
A writing that is both final and complete terms cannot be changed or added by any prior or contemporaneous oral or written agreement.
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Common Law
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Plain Meaning Approach
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UCC admits PE to show:
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any meaning to which the K language is reasonably susceptible
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3rd party K
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-exists where 3rd is intended, not incidental beneficiary of promise. 3 indicia of intent
1) bene is identified in promise 2) k calls for rendering of performance by promisor to identified bene 3) some relationship between promisee and bene that indicates promisee intended to benefit the bene |
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If 3rdpb, is it creditor or donee bene?
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a. Donee gets performance as gift & can only sue promisor
b. Creditor is one to whom promisee already owes an obligation adn promisee negotiates for the promise to satisfy this existing underlying obligation |
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3rdpb substantive rules
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1. 3rdpb or promisee can enforce
2. benef can enforce the promise in the form it was in when benes rights vested, until vesting the promisee and or can modify or rescind 3. Rights vest when 3rdpb learns of the promise and either assents to it, changes position in reliance on it, or sues on it |
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Assignment occurs when a party to a K that has already been formed unilaterally assigns rights to a 3rd party
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Valid when: 1) right must be assignable, 2) must be properly assigned
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Assignment handling
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1) is assignment valid? 2) are there assignments for consid? if so, they take priority over gratuitous 3) if only gratuitous, last controls unless exception 4) if only consid, first controls unless exception
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Delegation of duties
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1) is duty delegable? if so, delgator remains a surety for the performance of the delegate and if delegate doesn't peform, delgator must. If gratuitous delegation, obligee can't require delegate to peform. IF for consid, obligee can sue delegate bc obligee is creditor bene of a 3dpbk between delegate and delagator
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Conditions v. Promises
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Promises create obligations while conditions limit them
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Condition
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an event that must occur or be excused before promisor has duty to perform
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2 step approach for condition problems:
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1) look for language of express condition 2) if none, determine what constructive condition the law will imply
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Excuses for Conditions
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1. Failure to cooperate or prevention
2. anticipatory repudiation 3. Voluntary disablement 4. Estoppel-before condition was to be fulfilled 5. Waiver - after condtion was to have been fulfilled |
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Satisfaction of Conditions
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1. Complete
2. Substantial-but UCC perfect tender rule unless installment K 3. Doctrine of Divisibility |
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Discharge of Duties 8 grounds
FAN MIMIC |
Frustration of purpose, Accord and satisfaction, novation, modification, impossibility, mutual recission, impracticability, condition subsequent
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Accord and satisfaction
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Accord=new agreement to clarify duties
Satisfaction = performance of accord |
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Impossibility
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Death or physical incapacity of person needed to fulfill duties usually discharges but if duties are delegable, no discharge
-must be permanent -destruction of subject matter |
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UCC rules for destruction of identified goods
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-Where K obligates seller to deliver goods directly t buyer w/out common carrier
-If seller is merchant, risk of loss transfers to buyer when buyer physically receives goods -If seller not merchant, risk of loss passes when seller makes goods available to buyer for reasonable time and gives notice |
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Common Carrier Rules
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Seller responsible:
FOB=free on board FAS=free alongside Buyer responsible: CIF=price includes cost, insurance & freight CF=price includes cost and freight |
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Impracticability
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Something occurs that was unforeseeable at time of formation that now makes it unresaonably difficult or expensive to perform
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Frustration of Purpose
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Duties discharged where a party's purpose for the K is destroyed by some unforeseeable event and the other party knew of this purpose at the time of formation
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Expectancy Damages
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Difference between net value of what was promised and net value of what was received, if anything from breacher. Recoverable except to extent they could be reasonably mitigated.
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Consequential Damages
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Can recover other losses caused by breach so long as reasonably foreseeable at time of formation. Duty to mitigate.
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Incidental Damages
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May recover reasonable costs of mitigation
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Quasi-K recovery
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Where a promise is not enforceable, but 1 party receives a benefit from the other, the party bestowing the benefit may recover its reasonable value
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Liquidated Damages
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enforceable if
1. at time of formation damages for breach were difficult to estimate, and 2. amount specified was reasonable forecast of actual damages |
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Specific Performance
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a. Money damages inadequate
b. Unique c. Is enforcement feasible? d. Equitable defenses? ex: laches, unclean hands |
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UCC Remedies
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1. Seller warranties=promises
a. Express warranties b. Implied warranties ex: warranty of title, merchantibility, fitness for the specific purpose |
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Limitations on UCC Warranties & Remedies
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Limitations:
1. Disclaimers a.. Express warranties cannot be disclaimed, but implied can Limits on Remedies: Warranty survives but remedies are reduced. Limitation on remedy enforceable unless it makes the remedy fail of its essential purpose or is unconscionable |
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Buyer's Remedies for sellers breach of warranty
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a. Status quo remedies. Designed to get goods back into sellers control after seller ships but breaches.
1. Rejection: in K for single delivery, buyer can reject any noncorming shipment before accepting goods, no matter how trivial the nonconformity 2. Revocation of Acceptance: buyer can revoke acceptance for substantial defect or nonconformity if problem was difficult to discover at the time goods were accepted or seller said defect would be cured and wasnt. Acceptance occurs when buyer fails to reject in reasonable time, or indicates goods acceptable or does anything inconsistent w/sellers ownership |
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Other buyers remedies: damages
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diminished value of goods.
Buyer can cover by buying substitute goods w/in reasonable time of learning of breach. IF buyer covers, damages = diff between cover price & K price, if buyer does Not cover damages=diff between market price at time buyer learned of breach & K price |
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Sellers remedies for buyers breach
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1. Right to withhold goods
2. Right to stop in transit & recover shipped goods if buyer insolvent, if not insolvent, sellr can stop in transit & recover only large shipments like carloads |
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Other Sellers remedies: Damages
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Damages=diff between K price & substitute sales price, must give buyer notice
Recover damages=diff between k price & market price at time & place delivery was to be made |
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Remedies for Lost Volume Sellers
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Can recover lost profits
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Offer
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An expression of promise, undertaking or commitment to enter into a K
Once made, may be accepted or rejected until and unless terminated. |
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Contract Damages
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Must be foreseeable to be recoverable.
Must be ascertainable w/reasonable certainty to be recoverable. Should put the nonbreaching party where he would have been had the promise been performed. |
