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130 Cards in this Set
- Front
- Back
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What are the Remedies in Contracts?
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Damages
Recission/Restitution Reformation Specific Performance Injunction (employment contract) |
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Contract formation?
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UCC
Offer Termination Revocation Rejection Acceptance Consideration Defenses |
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What is Contract Mental Checklist
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Formation
Third Parties Rights Conditions Discharge Breach Remedies |
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How do you determine if a contract exist?
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The word VALID will be presented
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Offer TERMS (DEFINITE/CERTAIN) QTIPS
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QUANTITY
TIME FOR PERFORMANCE IDENTITY OF PARTIES PRICE SUBJECT MATTER |
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What is the def of offer?
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An offer is an outward manifestation of present contractual intent which is certain and definite in terms communicated to the offeree
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What is the definiteness of terms -modern law
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Reasonable terms
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Definiteness of terms -RESTATEMENT SECOND
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sufficent if terms provide a basis of determing existence of a breach and for giving appropriate remedy
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What is Detrimental reliance - Restatement Second
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Requires reasonable/foreseeable reliance or forbearance of a substantial character
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UnilateralContract - Restatement Second 45
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Once substantial peformance begins offer must be kept open for a reasonable time
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When can an offer revoke the offer
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Express revocation to offeree before acceptance -upon receipt
Mail - EFFECTIVE UPON RECEIPT |
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Indirect revocation
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Offeree acquires reliable information that offeror cannot perform. Look for acts inconsistent with the contract
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How can an offeree reject?
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Conduct express/implied
Mail - EFFECTIVE UPON RECEIPT Look out for counter offer |
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Termination by operation of law
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Lapse of time
Death/Destruction of subject matter Death/Insanity of either party Supervening illegality Exception - option contract |
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Acceptance
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An acceptance is an unequivocal assent to the terms of the offer
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Bilateral Acceptance
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Offeree manifests acceptance by giving required return promise
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Unilateral
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Offeree manifests acceptance through complete performance. R2nd 45 will allow partial performance
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Is a grumbling acceptance and acceptance or counter offer?
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Acceptance
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Option K- Does the mailbox rule apply?
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No
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Mailbox Rule (5)
1-3 Offeree can't make up mind |
Acceptance effective upon dispatch contract is formed whether reaches offeror or not
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1) Mailbox Rule (offeree)
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Acceptance dispatched first; rejection second =
CONTRACT unless rejection arrives first and offeror detrimentally relies on rejection |
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2) Mailbox Rule (offeree)
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Rejection dispatched first; acceptance second; Rejection received first; Acceptance received second
NO CONTRACT |
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3) Mailbox Rule (Offeree)
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Rejection dispatched first; acceptance second; acceptance received first; rejection received second
CONTRACT |
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4) Mailbox Rule (Offeror can't make up mind)
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Revocation sent first; acceptance sent second; revocation received
CONTRACT - MAILBOX RULE ACCEPTANCE UPON DISPATCH |
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5) Mailbox Rule (Offeror)
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Revocation sent first; revocation received- acceptance dispatched
NO CONTRACT - NO MAILBOX RULE |
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Consideration
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Consideration is that which is bargained for and given in exchange for a return promise
Past Consideration - No Moral Consideration - No Gift promise - No |
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Legal Detriment
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Must give up something. Action by the promisee taken in reliance upon action of the promisor giving up a legal right/change in obligation
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New promise to pay a past debt, statute has run - you reaffirm debt? Is that consideration
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Reaffirmation debt amount due
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Agreement to accept smaller sum as full discharge of existing debt?
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Is consideration
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Liquidated debt (certain debt)
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No consideration
Exceptions different performance different method of payment |
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Liquidated debt lessor payment - rid of debt
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No
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Unliquidated Debt, payment of lessor sum -rid of debtn(uncertained)
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Yes.
Accord and satisfaction |
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UCC Cash
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Full Satisfaction
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UCC may not be full if
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Sign under protest may not be payment in full
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Pre-exiting is new consideration required?
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No.
Unless unantisipated considerations |
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Valid Modification Common Law
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Need new consideration
R2nd unanticipated conditions C/L oral modification was valid |
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Illusory promise examples
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No obligation imposed
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Unfettered discretion
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I will pay as much as I want to
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Promissory Estoppel
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Subsitutes for consideration Use only is no consideration exists to support the contract
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Promissory Estoppel - Detrimental reliance - Common Law
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Required foreseeable reasonable reliance resulting in substantial economic loss (enitre contract)
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Promissory Estoppel - Modern Law
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A promise that the promisor should resonably expect and does induce action which the promise justifiably relies to his detriment
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Pre exisiting moral obligation - Minority Rule
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Recovery allowed in quasi contract (prevent unjust enrichment) bystander gives aid and victim promises to pay
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Statute of Frauds- Applies to oral contracts or incomplete writings
MR. Dog Should Pray More Frequently Religiously |
M- Marriage
R- Real Estate D- Debt of others O- One year G- Goods S- Sufficient Memorandume P- Part performance M-Main Purpose Doctrine F-Full Performance R- Receipt of goods or payment of purchase price |
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Promise in consideration of Marriage what will take it out of SOf
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Sufficient memorandum takes out of SOF; essential terms, signed by party to be charged
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Real Property what will take it out of SOF
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Part performance doctrine takes out of SOF
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Wbat takes debt of another out of the SOF
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Main Purpose Doctrine
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What takes One year out of SOF
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Full performance by one party
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Goods $500 or more what takes it out of SOF
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Receipt of goods, or payment of purchase price. UCC buyer receives and accepts all or part of the goods
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Unconscionability?
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Involves disparity, in the bargaining process, unfair, against public policy
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Adhesion Contracts
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Substantially unequal bargaining position; take it or leave it contract
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Estoppel to plead statute
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Promisor reprents by conduct that he will perform, coupled with promisee's detrimental reliance
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Minors are still liable in quasi contract?
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for reasonable value of necessities food and shelter
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mutal mistake?
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Both share a basic assumption of some fact - BASIS OF THE BARGIAN = NO CONTRACT
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Unilateral Mistake
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Only one party mistaken.
Offeree knows of mistake and has reason to know =no contract Transcription error-reformation used to save the contract - by court (remember .40 or .50 example) |
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Ambiguity
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Open to multiple interpretation
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Mispresentation
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Can be a defense to a contract
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Parol Evidence Ruledesigned to carry out the parties intentions)
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Any written/oral statement made PRIOR OR ORAL STATEMENTS MADE CONTEMPORANEOUS WITH THE CONTRACT cannot vary, add or , or contradict terms of original writing
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Parol Evidence Rule applies only to writing which parties intend to be the final expression of their bargain
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Four corner tests- fully intergrated
Did parties actually intend writing to be an integration Partial integration - Only particular terms integrated but does not bar parol evidence on subjects that it does not cover |
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Parol Evidence Rule Exceptions to get the evidence
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1- Defenses to formation (lack of consideration, etc)
2- Establish collateral agreement 3- Establish subsequent agreements modification 4- Separate consideration 5- Naturally omitted terms 6- Existence of a condition precedent to legal effectiveness of written agreement 7- Course of performance, course of dealing, and usage |
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What is a good (ucc)
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All tangible chattels personal property which are movable at the time of identificaiton to be contract for sale
Growing Crops and timber Minerals Anthing attached to the land Unborn Young animals |
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Good and Services
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1. Predominate factor test
2. Gravament of injury 3. Severance of contract |
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Good Faith
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Good faith means duty of honesty in fact and the observance of reasonable commercial standards of fair dealing
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Does the UCC only apply to merchants
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No.
Applies to transactions goods, period, merchants held to a higher standard of fair dealing |
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Merchant
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A merchant is a person who deals in good kind of goods involved in the transaction or otherwise holds himself out of having knowlege or skill peculiar to the practices or good involved in the transaction
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Non Merchant Duty
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Implied obligation of good faith
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Ucc - Gap Filler?
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Except quantity
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Missing Terms (implied term) fill ins
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1. Course of performance
2. Course of dealing 3. Usage of trade 4. Hierarchy of terms |
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Firm OFFER rule (VERY IMPORTANT)
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Offer by a merchant. A firm offer is irrevocable without consideration for a reasonable time or for a time specified in the offer, but in no event for a period of time longer than three months:
1. Goods 2. Merchants 3. Signed written offer 4. A period of irrevocability - no more than three months |
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Acceptance under UCC
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By medium reasonable under the circumstances
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Offer for prompt shipment an acceptance UCC
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Yes. Either a prompt promise to ship or by the act of shipment
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Shipment of nonconfirming goods
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Can either be an acceptance and a breach or a counter offer
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Battle of the Forms - Additional or different terms in acceptance
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Very testale
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Merchant Rule Battle of the FOrms
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The additonal terms are in: unless
1. Offer expressly limies acceptance to the terms of the offer 2. The terms materially alterate the offer 3. Original offeror notifies the offeree that he objects to the additional terms withinh a commerically reasonable period of time |
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Different terms
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Never become part of the contract, because the offeror is the master of the offer
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Knock out rule
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Different terms do not become part of agreement and they knock out offer terms from which they differ; thus contact terms are only those to which both parties agreed and UCC implied terms
The court falls back on performance of the parties |
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Dealing with merchants
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if one or both parties are nonmerchants then the additional or differnt termsr will not become part of the contract unless the offeror expressly assents to them in writing
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2207 can added terms apply in a writtent confirmation letter
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Yes
SOF problem, two merchants oral agreement, confirmation letter of oral agreement with additional terms, must object within 10 days, will be liable for terms unless they materially alter the contract |
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Auctions with reserve
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auctioneer MAY withdraw the goods and reject all bids AT ANY TIME UNTIL HE ANNOUNCES THE COMPLETION OF A SALE
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Auctions without reserve
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Goods MAY NOT be withdrawn if a bid has been made, BIDS MADE WITH THE FALLING OF THE HAMMER CAN BE ACCEPTED OR REJECTED WITH AUCTIONEER DISCRETION
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UCC is consideration required for modification? If not what is required
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NO. Good faith
Oral ok unless SOF; writing terms of the original contract |
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Illusory Problems (UCC)
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Court will imply best efforts on the part of the seller to supply the goods and buyer to use best effort to sell in exclusive dealing agreement (good faith implied)
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Does the UCC favor Requirement /output contracts
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As long as in good faith, but limits liability to reasonably forseable demand of other party
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UCC (SOF) Sale of Goods - take out?
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Sufficient Memo
1. Quanity 2. Parties ID 3. Signed by party to be charged |
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Written Letter of confirmation
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Merchants only
Letter of confirmation signed by the Sender.. (2207 problem) If 10 days have past and there is no objection, signed contract sat SOF Added terms, never responded as long as they do not materially alter the contract |
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UCC out of SOF
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1. Partial performance
2. Partial payment 3. SPECIALLY MANUFACTURED GOODS 4. Pleading and testimonial admission 5. Estoppel |
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UCC Parol Evidence Rule?
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Bring it in unless reason to bring it out.
opposite Common Law - prevent from coming in! |
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Third Party Beneficiary Mnemonic Approach
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Does Public Intercourse Cause VD
D - Define P - Privity I Intent to benefit C Classification V Vesting D Defenses |
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Defined
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A third party beneficiary contracts is one wherein performance by the promisor will benefit a third party
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Privity
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Rquiree for one ot be able to have standing
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Intent of Promisee to Benefit
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1. At time of contract
2. Was promisee intent directly undertaken to benefit beneficiary 3. Facts will be normally support intent |
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Classify Beneficiary
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1. Creditor
2. Donee 3. Incidential beneficiary |
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Creditor
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Promisor's promise is to discharge a debt or duty owing by him to a third party
Majority- legal enforceable claim Vesting - notice and assent- majority Minority - relies to his detriment |
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Donee
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If the intent of the promisee in obtaining promisor's promise of performance is to make a gift to beneficiary
Vesting - Notice and assent, a) material change to his detriment b) Upon formation of the contract |
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Incidental Beneficiary
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A third party who stands to benefit from the performance of the contract but is neither a donee or a creditor isd an incidental bene. No contract rights exist. Don't want to argue incidental bene on essay exam
Vesting - No rights at all |
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Intended beneficiary - Restatement
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Vesting takes place where beneficary
1. Assents to the promise in a manner required by the parties 2. Brings suit to enforce the promise 3. Materially change position in justifiable reliance thereon |
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Beneficary v. Promisor
C v. B |
OK, however, promisor cannot assert promisee (A) defenses against third party
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Beneficiary v. Promisee
C v. A |
Donee- no rights
Creditor- limited to orginal obligation |
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Assignee and delegate are strangers of what?
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of the initial two party contract
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Assignment (mnemonic)
DPRAVED |
DPRAVED
Define Privity RIght Assignable Valid present assignment Effect of valid assignment Defenses |
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Assignment
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In order to assign contracts rights, assignor must sufficiently described those rights and indicate a prsent intention to divert himself completely of same and set them up exclusively in assignee. Can be oral or written need not be supported by consideration
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General Rule re Assignments
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THe courts favor the free assignments of contratual rights. However, the assignment will be denied where it would materially vary risk or duty of the obligor
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Personal contracts are usally not assignable?
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Personal Service Contract - so involves the personality or personal characteristic of the obligee/assignor that it would be unfair to require an obligor to perform to the third part (lawyer, doctor) too personal,
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Can you assign a future right to a non existing future contract?
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NO
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Defenses Obligor against assignee
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Obligor may assert against the assignee all defenses which would havce been available against the assignor
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Holder in Due Course, is like what in contract law
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BFP. And not subject to personal defenses. Protected like BFP
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Assignee against assignor
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1. assignor impliedly warrants that the assignment actually exist.
2. assignment is genuine and what it purports to be 3. will do nothing to interfer with the right |
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Delegation (tranfer of duties and the court do not favor them) Why because it alters the expectation of the parties
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A delegation is an authorization to another to render performance of a legal duty. Make sure that it does not materially vary the promised performance
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Deligation personal duties will
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may materially affect obligee's bargain to require that a stranger's performance be accepted. Very unique...Key
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Novation
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Parties all agree to allow a substitute to come and in perform. Must have three consents
1. Deligatee 2. Deligator (off the hook) 3. Obligee (will consent giving up his right to sue) |
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Can you delegate output contract?
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No.
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Covenant
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Absolute duty to perform (failure to perform equates to breach)Is a PROMISE. I promise to do....I promise to paint your house in exchange for_____ I agree to paint your house in exchange for $_______ (Majory or minor)
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Condition
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An act/event the happening of which either creates/extinguishes an absolute duty to perform (failure to perform prevents a duty from arising)
If then subject to, provided that, on condition that |
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Express condition
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Explicitly stated in contract; strictly enforced with literal compliance
THINK EXAMPLE PAINTING NOT LIKED...Court may establish a covenant = major and minor breach discussion |
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Implied conditions
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Implied in contract for fairness justice (look to intent of the parties)
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Implied in Fact
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1. Cooperation
2. Good faith 3. Workmanlike manner |
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Implied in Law (Constructive conditions) (3) Before duty arises!
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Precedent - before
Concurrent - during Subsequent - after |
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Substantial performance / minor deviation (plaintiff must prove in order to recover)
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1. Defendant got substantially what he bargained for
2. Defendant can be reimbursed for what he did not receive 3. Great hardship on plaintiff if he is denied recovery under the contract 4. Deviation was not willful a) plaintiff will recover contract price minus damages b) plaintiff is unable to meet burdent (quasi-contractual relief) |
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Divisibility
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Court will allow plaintiff recovery as to the sections of the contracts completed and conditions will be satified as to each completed part. 1000 tires for 10 months. Contact can be divided into two or more parts. plaintiff is not calling for the performance of the whole = complete performance on the parts that have been completed.
Employment contracts sale of goods |
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Have the conditions been excused? SWAP DIVE
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S. Substantial performance
W - give up a known right A - Anticipated repudiation P - Prevention D- Divisibility I- Impossibility of performance V- Voluntary disablement E- Estopel |
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Anticipatory repudiation
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Express words repudiating intention to perform contract
I am not going to perform under the contract. Must be unequivocal v. mere possibility (not sure...=no) |
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Discharge MNEMONIC
I'M FOR SANDI |
I - Impossibility of performance
M - Modification F - Frustration of Purpose O- Occurence of Condition subsequent R- Rescission S - Substituted Contracts A - Accord and Satification N - Novation D - Defenses to formation I - Impracticability |
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Impossibility of performance
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after the contract is entered into, due to an event, performance became objectively imposisble to accomplish
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Modification
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Change inthe obligations of a contract requiring consideration mutual assent
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Frustration of purpose
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DUe to an unforeseeable event, value of contract, as contemplated by both parties
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Occurence of condition subsequent
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Will discharge duty to perform (insurance company requires notice before payment to beneficiary)
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Rescission
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Mutual agreement by parties to terminate their contract
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Substituted contracts
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A second separate contract that alters first contract
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Accord and satification
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An accord is an executory agreement intended to compromise an existing obligation
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Defenses to formation
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mutual mistake, lack of consideraton, illegality, capacity
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Impracticability
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Minority rule, whereby event renders performance commercially impossible
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