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130 Cards in this Set

  • Front
  • Back
What are the Remedies in Contracts?
Specific Performance
Injunction (employment contract)
Contract formation?
What is Contract Mental Checklist
Third Parties Rights
How do you determine if a contract exist?
The word VALID will be presented
What is the def of offer?
An offer is an outward manifestation of present contractual intent which is certain and definite in terms communicated to the offeree
What is the definiteness of terms -modern law
Reasonable terms
Definiteness of terms -RESTATEMENT SECOND
sufficent if terms provide a basis of determing existence of a breach and for giving appropriate remedy
What is Detrimental reliance - Restatement Second
Requires reasonable/foreseeable reliance or forbearance of a substantial character
UnilateralContract - Restatement Second 45
Once substantial peformance begins offer must be kept open for a reasonable time
When can an offer revoke the offer
Express revocation to offeree before acceptance -upon receipt

Indirect revocation
Offeree acquires reliable information that offeror cannot perform. Look for acts inconsistent with the contract
How can an offeree reject?
Conduct express/implied
Look out for counter offer
Termination by operation of law
Lapse of time
Death/Destruction of subject matter

Death/Insanity of either party

Supervening illegality

Exception - option contract
An acceptance is an unequivocal assent to the terms of the offer
Bilateral Acceptance
Offeree manifests acceptance by giving required return promise
Offeree manifests acceptance through complete performance. R2nd 45 will allow partial performance
Is a grumbling acceptance and acceptance or counter offer?
Option K- Does the mailbox rule apply?
Mailbox Rule (5)
1-3 Offeree can't make up mind
Acceptance effective upon dispatch contract is formed whether reaches offeror or not
1) Mailbox Rule (offeree)
Acceptance dispatched first; rejection second =
CONTRACT unless rejection arrives first and offeror detrimentally relies on rejection
2) Mailbox Rule (offeree)
Rejection dispatched first; acceptance second; Rejection received first; Acceptance received second
3) Mailbox Rule (Offeree)
Rejection dispatched first; acceptance second; acceptance received first; rejection received second

4) Mailbox Rule (Offeror can't make up mind)
Revocation sent first; acceptance sent second; revocation received

5) Mailbox Rule (Offeror)
Revocation sent first; revocation received- acceptance dispatched

Consideration is that which is bargained for and given in exchange for a return promise

Past Consideration - No
Moral Consideration - No
Gift promise - No
Legal Detriment
Must give up something. Action by the promisee taken in reliance upon action of the promisor giving up a legal right/change in obligation
New promise to pay a past debt, statute has run - you reaffirm debt? Is that consideration
Reaffirmation debt amount due
Agreement to accept smaller sum as full discharge of existing debt?
Is consideration
Liquidated debt (certain debt)
No consideration
different performance
different method of payment
Liquidated debt lessor payment - rid of debt
Unliquidated Debt, payment of lessor sum -rid of debtn(uncertained)

Accord and satisfaction
UCC Cash
Full Satisfaction
UCC may not be full if
Sign under protest may not be payment in full
Pre-exiting is new consideration required?

Unless unantisipated considerations
Valid Modification Common Law
Need new consideration

R2nd unanticipated conditions

C/L oral modification was valid
Illusory promise examples
No obligation imposed
Unfettered discretion
I will pay as much as I want to
Promissory Estoppel
Subsitutes for consideration Use only is no consideration exists to support the contract
Promissory Estoppel - Detrimental reliance - Common Law
Required foreseeable reasonable reliance resulting in substantial economic loss (enitre contract)
Promissory Estoppel - Modern Law
A promise that the promisor should resonably expect and does induce action which the promise justifiably relies to his detriment
Pre exisiting moral obligation - Minority Rule
Recovery allowed in quasi contract (prevent unjust enrichment) bystander gives aid and victim promises to pay
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
Promise in consideration of Marriage what will take it out of SOf
Sufficient memorandum takes out of SOF; essential terms, signed by party to be charged
Real Property what will take it out of SOF
Part performance doctrine takes out of SOF
Wbat takes debt of another out of the SOF
Main Purpose Doctrine
What takes One year out of SOF
Full performance by one party
Goods $500 or more what takes it out of SOF
Receipt of goods, or payment of purchase price. UCC buyer receives and accepts all or part of the goods
Involves disparity, in the bargaining process, unfair, against public policy
Adhesion Contracts
Substantially unequal bargaining position; take it or leave it contract
Estoppel to plead statute
Promisor reprents by conduct that he will perform, coupled with promisee's detrimental reliance
Minors are still liable in quasi contract?
for reasonable value of necessities food and shelter
mutal mistake?
Both share a basic assumption of some fact - BASIS OF THE BARGIAN = NO CONTRACT
Unilateral Mistake
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)
Open to multiple interpretation
Can be a defense to a contract
Parol Evidence Ruledesigned to carry out the parties intentions)
Any written/oral statement made PRIOR OR ORAL STATEMENTS MADE CONTEMPORANEOUS WITH THE CONTRACT cannot vary, add or , or contradict terms of original writing
Parol Evidence Rule applies only to writing which parties intend to be the final expression of their bargain
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
Parol Evidence Rule Exceptions to get the evidence
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
What is a good (ucc)
All tangible chattels personal property which are movable at the time of identificaiton to be contract for sale
Growing Crops and timber
Anthing attached to the land
Unborn Young animals
Good and Services
1. Predominate factor test
2. Gravament of injury
3. Severance of contract
Good Faith
Good faith means duty of honesty in fact and the observance of reasonable commercial standards of fair dealing
Does the UCC only apply to merchants

Applies to transactions goods, period, merchants held to a higher standard of fair dealing
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
Non Merchant Duty
Implied obligation of good faith
Ucc - Gap Filler?
Except quantity
Missing Terms (implied term) fill ins
1. Course of performance

2. Course of dealing

3. Usage of trade

4. Hierarchy of terms
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
Acceptance under UCC
By medium reasonable under the circumstances
Offer for prompt shipment an acceptance UCC
Yes. Either a prompt promise to ship or by the act of shipment
Shipment of nonconfirming goods
Can either be an acceptance and a breach or a counter offer
Battle of the Forms - Additional or different terms in acceptance
Very testale
Merchant Rule Battle of the FOrms
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
Different terms
Never become part of the contract, because the offeror is the master of the offer
Knock out rule
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
Dealing with merchants
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
2207 can added terms apply in a writtent confirmation letter

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
Auctions with reserve
auctioneer MAY withdraw the goods and reject all bids AT ANY TIME UNTIL HE ANNOUNCES THE COMPLETION OF A SALE
Auctions without reserve
UCC is consideration required for modification? If not what is required
NO. Good faith

Oral ok unless SOF; writing terms of the original contract
Illusory Problems (UCC)
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)
Does the UCC favor Requirement /output contracts
As long as in good faith, but limits liability to reasonably forseable demand of other party
UCC (SOF) Sale of Goods - take out?
Sufficient Memo

1. Quanity

2. Parties ID

3. Signed by party to be charged
Written Letter of confirmation
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
UCC out of SOF
1. Partial performance

2. Partial payment


4. Pleading and testimonial admission

5. Estoppel
UCC Parol Evidence Rule?
Bring it in unless reason to bring it out.

opposite Common Law - prevent from coming in!
Third Party Beneficiary Mnemonic Approach
Does Public Intercourse Cause VD

D - Define
P - Privity
I Intent to benefit
C Classification
V Vesting
D Defenses
A third party beneficiary contracts is one wherein performance by the promisor will benefit a third party
Rquiree for one ot be able to have standing
Intent of Promisee to Benefit
1. At time of contract
2. Was promisee intent directly undertaken to benefit beneficiary

3. Facts will be normally support intent
Classify Beneficiary
1. Creditor

2. Donee

3. Incidential beneficiary
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
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
Incidental Beneficiary
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
Intended beneficiary - Restatement
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
Beneficary v. Promisor

C v. B
OK, however, promisor cannot assert promisee (A) defenses against third party
Beneficiary v. Promisee

C v. A
Donee- no rights

Creditor- limited to orginal obligation
Assignee and delegate are strangers of what?
of the initial two party contract
Assignment (mnemonic)

RIght Assignable
Valid present assignment
Effect of valid assignment
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
General Rule re Assignments
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
Personal contracts are usally not assignable?
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,
Can you assign a future right to a non existing future contract?
Defenses Obligor against assignee
Obligor may assert against the assignee all defenses which would havce been available against the assignor
Holder in Due Course, is like what in contract law
BFP. And not subject to personal defenses. Protected like BFP
Assignee against assignor
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
Delegation (tranfer of duties and the court do not favor them) Why because it alters the expectation of the parties
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
Deligation personal duties will
may materially affect obligee's bargain to require that a stranger's performance be accepted. Very unique...Key
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)
Can you delegate output contract?
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)
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
Express condition
Explicitly stated in contract; strictly enforced with literal compliance

THINK EXAMPLE PAINTING NOT LIKED...Court may establish a covenant = major and minor breach discussion
Implied conditions
Implied in contract for fairness justice (look to intent of the parties)
Implied in Fact
1. Cooperation

2. Good faith

3. Workmanlike manner
Implied in Law (Constructive conditions) (3) Before duty arises!
Precedent - before

Concurrent - during

Subsequent - after
Substantial performance / minor deviation (plaintiff must prove in order to recover)
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)
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
Have the conditions been excused? SWAP DIVE
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
Anticipatory repudiation
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)
Discharge MNEMONIC

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
Impossibility of performance
after the contract is entered into, due to an event, performance became objectively imposisble to accomplish
Change inthe obligations of a contract requiring consideration mutual assent
Frustration of purpose
DUe to an unforeseeable event, value of contract, as contemplated by both parties
Occurence of condition subsequent
Will discharge duty to perform (insurance company requires notice before payment to beneficiary)
Mutual agreement by parties to terminate their contract
Substituted contracts
A second separate contract that alters first contract
Accord and satification
An accord is an executory agreement intended to compromise an existing obligation
Defenses to formation
mutual mistake, lack of consideraton, illegality, capacity
Minority rule, whereby event renders performance commercially impossible