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401 Cards in this Set
- Front
- Back
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gotta dime mac? yes I do! contract?
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under objective test it is likely B offered to exchange the die but A placed no consideration into the bargain and did not accept
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contracts approach - three big areas
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formation, performance, remedies
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types of contracts
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unilateral - one accept by performance, bilateral mutual promises to perform, express - oral or written words, implied in fact -conduct, implied in law - prevent unjust enrichment, dividisible , entire
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diagram
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A -> B
<- M? M? |
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applicable law
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CL or UCC
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formation - 3 areas
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mutual assent, consideration, defenses
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formation vs. modification - UCC 2-209
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a
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what kind of K triggers CL
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services, real P, sale of intangible Person P i.e. securities
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what kind of K triggers UCC
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sale of goods -article 2
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sale of goods for UCC
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tangible movable personal P
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merchant definition
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deals regularly in goods involve or holds themselves out as having special skill or knowledge as to those goods
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mutual assent 3 steps
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offer made, offer still open , acceptance
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mutual assent - offer made 3 elements
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requisite intent, content that is communicated
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mutual assent - offer made - vs. invitation to bid
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reasonable intent made a real invitation to bid - must be serious - trade bike for coffee when cold
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mutual assent - content - 3 elements
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express, gap rules, course of history
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mutual assent - offer made - standard
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would reasonable person think there is MA
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mutual assent - invitation to bid an offer?
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invitation to bid may invite offer
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mutual assent content - if essential terms are not in fact pattern
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1) consider history to make terms definite course of dealing in this K, dealing between parties in different K, trade usage of custom in industry absent exclusion of custom
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mutual assent - content - ambiguous terms - history
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course of dealing in this contract between these parties
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mutual assent content - if essential terms are not in fact pattern - gap rules - area where they can apply
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parties, subject matter, GF requirements and uotput Ks, price CL/ vs UCC and other terms
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mutual assent content - if essential terms are not in fact pattern - gap rules - which is more strict CL or UCC
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CL because UCC favors formation
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mutual assent content - if essential terms are not in fact pattern - gap rules - subject matter and quantity
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UCC an Cl are strict
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mutual assent content - if essential terms are not in fact pattern - gap rules - out and requirements
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promise to supply buyer with all requirements for specific duration and out the buyer promises to buy entire out from seller for specified duration
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mutual assent content - if essential terms are not in fact pattern - gap rules - out and requirements - GF standard
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no disproportionate tender
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utual assent content - if essential terms are not in fact pattern - gap rules - price Cl and UCC
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Cl strict UCC can gap fill reasonable , objective standard, agree to agree UCC has mad CL less strict
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utual assent content - if essential terms are not in fact pattern - gap rules - time mode delivery place etc
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filled under CL and UCC
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mutual assent communicated
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creates power of acceptance by being communicated and received by offeree
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mutual assent communicated
cross offers with identical terms ? |
creates power of acceptance on reciept
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mutual assent offer still open 2 main categories
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kind of termination, kind of offer
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mutual assent offer termination 3 ways
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own terms, events, acts of parties
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mutual assent offer termination
events |
lapse of time, death and destruction, ensuing illegality
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mutual assent offer termination death of offeror
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yes except estate may have to perform modernly
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mutual assent offer termination
destruction |
of subject matters terminates offer
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mutual assent offer termination
act of parties ends offer 3 areas |
rejection, repudication, revocation
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mutual assent offer termination
acts of parties - who rejects |
offeree
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mutual assent offer termination
acts of parties 2 types of rejection |
express/ implied rejection and true counteroffer
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mutual assent offer termination
acts of parties rejection |
offeree can reject - once rejected offer is forever dead
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J1 A offers to ell car J2 B rejects J3 withdraws rejection
1) is there a look for counter |
no
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mutual assent offer termination
acts of parties revocation - learns of conduct by offeror inconsistent with offer |
offer is revoked
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mutual assent offer termination
acts of parties would you consider a different price - terminate ? |
no that is a mere inquiry
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mutual assent offer termination
acts of parties who can revoke |
offeror is master of offer
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mutual assent offer termination
acts of parties types of revocation |
direct or indirect
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mutual assent offer termination
acts of parties indirect revocation |
action inconsistent with offer thoutat the offeree learns ab
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mutual assent offer still open - kinds of offers
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option, firm Ucc, supported by DR plain
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mutual assent offer still open
irrevocable - option |
offer held open for specified duration supported by consideration - irrevocable for duration
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mutual assent offer still open
irrevocable - firm UCC requirements |
1) sale of goods 2) merchant offeror 3) signed written offer 4) promise to hold open - time reasonable not to exceed 90 days
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mutual assent offer still open
irrevocable option if only a recital of consideration but not actual consideration |
yes majority allows mere recital of consideration
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mutual assent offer still open
irrevocable options mailbox rule applicable |
no option acceptance must be received not dispatched
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mutual assent offer till open
irrevocable - option - detrimentatl reliance on rejection terminates option? |
yes
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mutual assent offer still open
irrevocable UCC firm offer 2-205 effect |
irrevocable for period stated or reasonable period maximum 90 days
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mutual assent offer still open
irrevocable because supported through DR - effect - |
irrevocable for reas time in Maj
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mutual assent offer still open
irrevocable UCC firm offer 2-205 effect if not revoked in 90 day period does K automatically revoke at 90 days |
no must be explicitly revoked
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mutual assent offer still open
irrevocable because supported through DR - effect of mere preparation |
does not create irrevocability
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mutual assent offer still open
irrevocable because supported through DR - effect real DR - subcntractor facts - drennan MAJ? |
irrevocable MAJ yes - forms contract min no deal
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mutual assent offer still open
irrevocable because unilateral K |
becomes irrevocable at performance
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MA acceptance 3 things to think about
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capacity, communicated and unequivacable
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MA acceptance - capacity - eligible offeree
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capacity is created in offeree except option Ks can be assigned
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MA acceptance public offer - cop
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pre existing duty
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MA acceptance communicated CL 2 types
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bilateral unilateral
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MA acceptance communicated CL UL begins performance
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irrevocable for reas time
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MA acceptance communicated CL UL mere preparation vs. start of performance
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does not make irrevocable
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MA acceptance communicated UCC BL UL
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abolishes BL UL distinction - any acceptance like shipment with notification within reas tie
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MA acceptance communicated UCC 2-206 shipment of non-conforming goods
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radical departure from mirror image rule - is acceptance but also breach
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MA acceptance communicated UCC 2-206 shipment of non-conforming goods - buyer's options
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accept or reject all or part in commercially reas units
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MA acceptance communicated UCC 2-206 shipment of non-conforming goods - accomdation
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counter offer not a breach
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J1 A wire B a dealer please ship me 12 dozen 12 oz bottles of water
J2 B wries back promise to ship before COB on J4 on J3 A calls B to revoke - can offer for an act be accepted by promise |
yes acceptance by promise in UCC even if bargain was for performance A cannot revoke
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J1 A wire B a dealer please ship me 12 dozen 12 oz bottles of water
B did not wire A and shipped non-conforming goods CL and UCC |
no acceptance under Cl but UCC yes
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J1 A wire B a dealer please ship me 12 dozen 12 oz bottles of water
B ships wrong brand of water with notice of accommodation can A reject and sue |
a counter offer - can be rejected but no damges
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J1 A wire B a dealer please ship me 12 dozen 12 oz bottles of water
B ships wrong brand of water can A reject and sue |
under Cl no but can under UCC accept or reject all o part in any commercial units and sue
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J1 A wire B a dealer please promise to ship me 12 dozen 12 oz bottles of water
B ships - can offer offer f promise be accepted by act |
UCC has to notify A and ship within reas time - but yes
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MA acceptance - unequivocal
CL UCC |
Cl mirror image rule non mirror is counter offer , UCC - definie and seasonal and terms - battle of forms
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MA acceptance - unequivocal UCC - non mirror image
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K is formed under definite and seasonal even if terms vary
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MA acceptance - unequivocal
UCC varying terms acceptance lay persons 1 or both |
K formed on original terms in offer and new terms are proposals
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MA acceptance - unequivocal
UCC varying terms acceptance both merchants |
K is formed on new terms unless 1) ironclad offer=formed on orig terms or 2) objection within reas time=formed on orig terms or 3) material alteration=formed on orig terms 10%or more price - disclaimer- liquidated damages
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formation moves - when complete
offer rejection revocation maj and min acceptance |
offer -> receipt
rejection -> receipt revocation maj -> receipt revocation min -> dispatch acceptance -> dispatch |
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knock-out rule definition
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parties conduct indicates intent to form - implied in fact no expression of acceptance - knock out determines terms - terms on which forms agree are terms
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acceptance followed by rejection - reject overtakes acceptance K?
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yes
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minority revocation effective on dispatch - against an irrevocable offer
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watch for this
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rejection followed by acceptance K?
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mailbox rule falls out
whichever arrives 1st determines whether K |
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revocation sent after acceptance K?
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yes acceptance is effective on dispatch
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revocation sent prior to acceptance K? maj min
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revocation is effective on dispatch in min so revocation kills offer but MAJ acceptance on dispatch of acceptance
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MA - consideration 3 types
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bargained for exchange,
-><- PE, | A<- B restitution A->B |
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MA - consideration BFE 3 areas
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when , what, why - first great expectation that is protected
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MA - consideration BFE - when - past or moral LC and new rule
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past - not valid must be present at CL because SOL but modern rule may be enforceable or moral - gratuitous promises at CL no good but modern rule can enforce moral promise to extent to avoid unjust enrichment
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MA - consideration BFE -
what |
pre existing duty , forbearance to sue and illusory
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MA - consideration BFE -
what - preexisting |
if preexisiting duty then no consideration
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MA - consideration BFE -
what 3rd P PROMISeR |
A-><- B
| C tradition- no new consideration but modern rule allows enforcement |
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MA - consideration BFE -
what 3rd P PROMISeR - unilateral |
since no contract until performance both promises can e enforced
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MA - consideration BFE -
what - forbearance to sue |
forbearance is valid consideration
trad reas GF belief is consideration modern only GF belief is consideration if obviously invalid forbearance - naked promise |
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MA - consideration BFE -
what - illusory |
no because consideration must have real value - buy requirements is consideration but buy whatever she needs is illusory
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MA - consideration BFE -
what - illusory - at will trad modern |
trad no consideration but modern for goods implied Covenant of GF and fair dealing is enforceable
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MA - consideration BFE -
what - illusory - with notice |
notice makes an enforceable promise
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MA - consideration BFE -
what - illusory - exclusive dealer |
trad no promise to make definete undertaking but modern implied covenant of best efforts
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MA - consideration BFE -
why - 2 issues |
gifts subject to condition or disguised gift
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MA - consideration BFE -
why - gifts subject to condition |
negligible condition no benefit - not enforceable - PE? if no detrimental reliance - substantial - then no consideration
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MA - consideration BFE -
why - disguised gift |
court does not examine value of consideration - but a disguised gift is not a K - look to what motivated promise
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MA - consideration PE 3 elements
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B's promise, A's reasonble reliance, that avoids injustice
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MA - consideration PE - consideration substitute
reasonable reliance |
must be reasonable objective - jury decide what would
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MA - consideration PE - consideration substitute
avoid injustice |
out of pocket loss - reliance measure of damage
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consideration restitution under QK
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avoids unjust enrichment no consideration required
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defenses to enforcement - formation 4 areas
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capacity, public policy, fraud duress or mistake, writings
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defenses to enforcement - formation capacity 3 types
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minority, insanity, intoxication
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defenses to enforcement - formation capacity - effect 2
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void or voidable
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defenses to enforcement - formation capacity exception
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for necessities
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defenses to enforcement - formation public policy
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illegality or unconscionable
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defenses to enforcement - formation public policy illegality
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is or becomes illegal
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defenses to enforcement - formation public policy unconscionable 2 elements
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absence of meaningful choice an K terms unreasonably favorable
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defenses to enforcement - formation fraud or duress
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was not MA - not giving consent voluntarily
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defenses to enforcement - formation mistake mutual
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goes to essence of K is ground to rescind
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defenses to enforcement - formation mistake unilateral
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not a defense to enforcement unless reason to know and was unconscionable
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defenses to enforcement - formation writings 2 issues
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SOF and consider Parol Evidence
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SOF - 3 elements
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sale of RP, sale of goods => $500, one year rule, guarantee
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SOF - FP
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fee , easements, leases for more than 1 year - licenses are PP
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SOF sale of RP enforceable w/o writing
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yes part performance - possession and payments or improvements to RP
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SOF - sale of RP estoppel or waiver
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seller can waiver - reliance to buyer detriment
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SOF UCC
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2-201 sale of goods prices at $500 or more except custom goods specially manufactured not suitable for resale in ordinary course of bus and manufact party has made start
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SOF - goods >=$500 paid for or shipped
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exceptions to SOF
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SOF intangible valued at $5,000 or more ?
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is governed by SOF
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SOF one year rule - measured
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from time of formation through performance - SOF requires writing if cannot be completed
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SOF - one year possible that could be performed in less than year SOF apply
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no
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does full performance extinguish SOF requirement
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Yes
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SOF guarantees for the debt of another
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surety must be in writing -
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SOF - guarantees for the debt of another main purpose exception?
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if guarantor believes the main purpose is for his own economic benefit - oral enforceable
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SOF - what is adequate writing
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terms under CL more strict requires all essential terms
UCC memo indicates formation and quantity - adequate so long as signed CL person to be charge must sign- letterhead etc UCC - 2-201(2) 1 or both laypersons - party to be charged - letterhead rubber stamp both merchants is one sends another that is suffcient to bind sender the recipient is also bound unless he objects in writing within 10 days of receipt |
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SOF essential terms at CL
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parties, subject matter , quantity, price
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SOF merchants - letters
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both merchants if one sends another that is suffcient to bind sender the recipient is also bound unless he objects in writing within 10 days of receipt
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SOF exceptions
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part performance RP, full performance, main purpose -surety
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SOF types of K
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marriage, one year, RP, goods priced at >=$500, surety
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Parol E rule
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bars evidence of any prior or contemporaneous agreements that vary or contradict essential terms of integrate writing
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Parol E K's covered - must have writing to start with
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integrated K - not apply to oral , not apply to non integrated , face - what did parties intend
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Parol E effects contradiction of
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essential terms barred vs mere recital of fact - these can come in
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Parol E effects can it supplement
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partially integrated then ok completely integrated no
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integrated K
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did parties intend to be integrated - final and complete expression of their agreement
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merger clause trad and modern
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trad 4 corners moder court look deeper
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what is parol evidence
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extrinsic writing - oral or written - prior to or contemporaneous
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consistent collateral agreement
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different contract with separate consideration
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Parol E exceptions no deal
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to show no K duress, no consideration, oral condition - introduced no to show deal but to show there was no deal
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Parol E interpretation of ambiguity
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allowed as exception
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Parol E for reformation?
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yes - writing was inaccurate - scrivener's error
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Parol E exception subsequent agreements that vary or contradict
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not covered by SOF - modification
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SOF exceptions
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no deal, interpret deal, reformation, subsequent agreement
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formation modification diagram
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A-><-B then later A-><-B
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formation modification requirements MA CL and UCC
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CL yes
UCC yes |
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formation modification requirements consideration CL and UCC
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CL yes
UCC no GF |
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formation modification requirements writing CL and UCC
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CL no unless SOF even if K requires writing
UCC yes if Orig K then yes and if says Modified yes or SOF in UCC > $500 |
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formation modification requirements novation
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A and B agree new party C takes A place with B's assent
substitutes new party and or new performance for original ones |
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formation modification novation - discharge discarded party
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yes
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formation modification requirements accord and satisfaction
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GF dispute over how much is owed - agreement to new amount is accord and performance paying new amount discharges both old and new obligations
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performance diagram
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por A->B pee
pee A<-B por |
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performance - conditions three step approach
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type, satisfied, excused
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performance - conditions - types 3
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express, implied, constructive
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big picture flow
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formation
MA Consideration Defenses -> obligation to perform PERFORMANCE Conditions Discharge -> Absolute duty Breach -> remedy |
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K equation
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ormation
MA Consideration Defenses -> obligation to perform PERFORMANCE Conditions Discharge -> Absolute duty Breach -> remedy |
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performance - conditions - types in time
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precedent, concurrent , subsequent
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performance
Conditions express Breach -> remedy |
explicit language - provided that - on condition that - only if
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performance - conditions
implied |
no express langaue but from nature of agreement or relationship of parties courts imply - condition of good faith and fair dealing
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performance - conditions
constructive |
court reads in to order time of performance - one party takes a long time - build house vs. payment - constructive condition precedent
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performance
Conditions - covenant |
arises in this area because courts tend to prefer covenant under ambiguity
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performance - condition precedent
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must be satisfied before duty flows
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performance - condition - concurent
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must be performed simultaneously
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performance - condition - subsequent
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must be satisfied after
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what if no conditions that raise issue
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move on to discharge
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performance - condition - standard for satisfied pee - commercial
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objective reas person standard
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performance - condition - standard for satisfied 3rd p
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accept is architect is satisfied- GF satisfied
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performance - condition - standard for satisfied pee - personal
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GF subjective - portrait
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performance - condition - satisfied in bad faith
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bad faith excuses condition
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performance - condition - satisfied- time for payment
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when store becomes profitable but never occurs - if ambiguous and forfeiture results - courts will call covenant that sets tie for payment - reas expected store to be profitable - did not assume risk
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performance - condition - excused by 3
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waiver/estoppel, breach, forfeiture
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performance - condition - excused by waiver or estoppel
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through conduct waived or detrimental reliance is excused
waiver for minor - DR for material - DR consideration substitute for modification |
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performance - condition - excused by breach prevention
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prevention= BF interference with satisfaction - condition is satisfied
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performance - condition - excused by forfieture
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ambiguous becomes covenant and relief or breachor
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performance - condition - excused by breach repudiation
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if performance was condition repudiation satisfies condition then breach occur
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performance discharge major categories
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illegality, death, destruction, severe impracticability, commercial frustration
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performance discharge define
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changed circumstance that release or excuse parties from performance
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performance discharge can it be partial
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yes can be partial or complete
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performance discharge standard
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objective not subjective
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performance discharge death commercial
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does not discharge duty but estate must find substitute performance
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performance discharge death personal
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decedent was essential discharges duty
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performance discharge impossibility standard
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objective
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performance discharge impossibility types
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illegal, death, destruction
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performance discharge illegal
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objectively impossible so both parties dutydischarged
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performance impossibility destruction land sale
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land sale equitable Conv buyer risk vs. uniform vendor seller risk
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performance impossibility destruction types
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land sale, construction, service or repair, goods in transit, crops, means of production
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performance impossibility destruction construction
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builder until building complete
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performance impossibility destruction general
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who bears risk of loss
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performance impossibility destruction service/repair
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existing building owner risk
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performance impossibility destruction goods in transit
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FOB Seller = Buyer risk - buyer insures
FOB Buyer = Seller Risk seller insures = destination K |
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performance impossibility destruction crops
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partial = Seller partial discharge , complete = complete, normally objective unless particular means is basic assumption of K
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performance impossibility destruction means of production
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normally objective unless particular means is basic assumption of K then dischrge
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performance impossibility sever impracticality - 3 points
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extremely more burdensome, Claimant did not assume risk and mrket fluc not sufficient
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performance severe impracticalbility
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extreme burden discharges where German steam ship could not sale to Britain during WWI - increased burden
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performance severe impracticalbility - suez canal
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war closed canal had to o around cape of good hope increased cost burden did not discharge
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performance severe impracticalbility -market flucuations
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did not discharge
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performance commercial frustration discharge
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total frustration of principle purpose of the contract - makes what the party gets worthless - coronation suites then king got sick so discharged
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what happens if there are no discharges of obligation?
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move on to ripened absolute duty to perform
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performance breach time line
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prospective, present, relief
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performance breach prospective types
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AR - voluntary disableent
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performance breach AR
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through words or conduct convey an unequivocal intent not to perform
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performance breach AR - expressions of doubt
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do not rise to level of AR - must be unequivocal
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performance breach AR - assurances
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non-repudiating party may seek assurances if they do not get written adequate assurances within reas time or 30 days max then breach
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performance breach AR - less than repudiation - expressions of doubt
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assurances
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performance breach AR - effects - duty
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excuses conditions of B because non-performance is breach and discharges duty of A
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performance breach AR - mitigate
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non-breachor has affirmative duty to mitigate by making substitute rrangements
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performance breach AR - options of non-breachor
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sue now not wait for time of contract or urge urge retraction of repudiation - if A relies on breach by substituting cuts off breachor's power of retraction
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performance breach AR - options of non-breachor - must aggrieved party give notice of relying on breach and cutting off power of retraction
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only in min of Js
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performance breach AR - options of non-breachor - wait to sue
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may wait until time of performance
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performance breach AR - 3 options
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sue now and terminate, urge retraction or sue later
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performance breach PB present breach 2 issue areas
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minor?, or material?
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performance breach PB minor? CL and UCC
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CL - minor breach does not allow A to suspend performance but may recover damages
UCC - perfect tender rule 2-601 if goods in any way do not conform or manner of tender does not conform it is a breach |
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|
performance breach PB minor?
perfect tender 3 issues |
1) right to cure - if there is time buyer must allow seller right to cure 2) installment K 3) rejection after acceptance
|
|
|
performance breach PB minor?
perfect tender installment Ks |
buyer may reject only if breach impairs value of entire K - if seller gives adequate assurances of cure the buyer must accept non-conforming goods
|
|
|
performance breach PB minor?
perfect tender - rejection after acceptance |
tender substantially affect the value of goods or defect was not reasonably discoverable or buyer was lulled by seller's assurances then buyer may reject- not bound by earlier acceptance
|
|
|
performance breach PB minor?
when is breach material |
deprives A of expected benefit, degree of wrong, compensable in damages
|
|
|
performance breach PB minor?
amount of performance |
minor = already substantially performed material = not
|
|
|
performance breach PB material? 3 effects
|
A may suspend, give B time to cure unless in maj Breach was willful, damages
|
|
|
performance breach PB material? time to cure
|
if willful then maj J allows A to terminate and get damages
|
|
|
performance breach PB material? damages
|
available at breach - proportionate to material or minor
|
|
|
performance breach - what happens when B fails to perform an absolute duty
|
seek remedies - move on to remedies in essay
|
|
|
performance breach - breachor's rights 3
|
minor where B has substantially performed B entitled to A's performance minus offset for damages, if material breach then B may be given time to cure , if total breach divisible K B can be paid for part performance and non-div K restitution maj even willful gets value of benefit conferred minus damages min willful breachor gets no restitution
|
|
|
relief for breachor minor bach
|
minor where B has substantially performed B entitled to A's performance minus offset for damages
|
|
|
relief for breachor material breach
|
if material breach then B may be given time to cure ,
|
|
|
relief for breachor - total breach
|
if total breach divisible K B can be paid for part performance and non-div K restitution maj even willful gets value of benefit conferred minus damages min willful breachor gets no restitution
|
|
|
3rd p K - 3rd p por
|
A-><-B
| C - no consideration from C so promise is not enforceable |
|
|
3rd p K - guarantor
|
A-><-B<-C = SOF problem - if B defaults C steps in - requires writing except main purpose exception
|
|
|
3rd p K - 3rd P beneficiary
|
A-><-----B
| C<-B |
|
|
3rd p K - assignment rights
|
A-><-B
| C<-B |
|
|
3rd p K - delegation duties
|
C->B
" | A <-B |
|
|
3rd p K -diagram meaning of -> and ---->
|
A->= performance and promise
<---- = promise likely to C |
|
|
3rd p K - formation of A-B deal 3 steps
|
MA, consideration, defenses
|
|
|
3rd p K - timing K formed
|
from the beginning- time K was formed C was intended to benefit from K and was in the contemplation of A and B
|
|
|
3rd p K - 3d P Beneficiary - split promise - component of 3rd p bene K
|
B promises to A but B's performance runs to C
|
|
|
3rd p K - label for parties A B C
|
A pee, B por, 3d Pbeni =C
|
|
|
3rd p K - C intended Beni
|
intended Beni has rights under K
|
|
|
3rd p K - C incidental Beni
|
has no rights and is only incidentally benefited under K
|
|
|
3rd p K - - 2 types of intended benis
|
creditor and donee
|
|
|
3rd p K - intended Beni creditor and donee 1st and 2nd restatement
|
lumped together in 2nd restatement
|
|
|
3rd p K - creditor Beni
|
pre-existing debt owed to C creditor of pee - performance of por B to C satisfies debt to C
|
|
|
3rd p K - beni donee
|
C gets gift - relative of A - intended as gift
|
|
|
3rd p K - performance A-B deal conditions, discharge or breach
|
underlying K performance
|
|
|
3rd p K - performance A-B deal
modify /rescind - depends on one of 2 states |
vested or non-vested
|
|
|
3rd p K - performance A-B deal
modify /rescind how can C's rights vest modern before modification |
modern = D/R , C's knowledge and assent vests and if C sues to enforce then C's right vest
|
|
|
3rd p K - performance A-B deal what to consider in A-B deal
|
conditions, discharge and breach
|
|
|
3rd p K - performance A-B deal
modify /rescind how C's rights vest traditional |
creditor=D/R to vest
donee=vest at K formation |
|
|
3rd p K - performance A-B deal
westing effect |
vested rights get standing but non-vested do not
|
|
|
3rd p K - remedies A v B
pee v por - creditor and donee |
creditor = A recovers either $ damages or SP
donee = no $ damages C is just getting gift nut mat get SP or restitution |
|
|
3rd p K - remedies C v A
3rd P beni v pee creitor and donee |
creditor = C can sue on original debt
donee = no suit against pee because it was only gift |
|
|
3rd p K - remedies C v B
3rd p beni v por vesting and B's defenses B v C and A v C |
vesting = C rights need to have vested and bringing suit vests
B's defenses under B v C C stands in shoes of A yes B can raise defenses like breach -any defenses A v C SOL, no B's defenses do not include A v C defenses |
|
|
3rd p beni - A agrees to repair B's roof B agrees to pay A son C $5,000 diagram
|
A->B B---->A
B->C at formation typical 3rd p K A pee B por C intended beni donee - gift |
|
|
3rd p beni - A repairs roof as promised B refuses to pay C can C sue
|
bringing suit vests rights and 3rd p B can sue
|
|
|
3rd p beni - if A buys work supplies from Cody doe cody have rights under A-B deal
|
no because cody is incidental B
|
|
|
3rd p beni - before commencement of wok, A and B change minds and mutually rescind - C finds out about original deal can he enforce and demand $5,000 from B
|
no because C's rights never vested
|
|
|
3rd p beni - before A commences repair A breaches, and C in contemplation of getting $5,000 bought drum set on credit - can C enforce B's Promise to A to pay C $5,000
|
C D/R so rights vested and has direct COA against por
|
|
|
3rd p beni - before A commences repair A breaches, and C in contemplation of getting $5,000 bought drum set on credit - can C enforce B's Promise to A to pay C $5,000
B's defenses |
because A breached B has right to not perform and because C stands in A's shoes K breached no performance - C loses
|
|
|
3rd p beni - A repairs as promised B refuses to pay C - can C get $5,000 from A
|
cannot sue because C was 3rd P B donee so no suit
|
|
|
3rd p beni - A repairs as promised B refuses to pay C - can C get $5,000 from A - does it make any difference that at formation A owed C $5,000
|
can sue because C was 3rd P B creditor so C can sue on the original debt
|
|
|
B offered C $5,000 if A repairs her roof C knew the deal and spent $ in reliance. if A does not repair can C sue B for $
|
no consideration - no contract because unilateral offer with no acceptance
|
|
|
assignments - difference between assignments and 3rd p beni
|
3rd p beni is contemplated at time of formation - assignments occur after formati
|
|
|
assignments - diagram
|
A-> B A <- B
| C<-B |
|
|
assignments - consideration required
|
no
|
|
|
assignments - label parties A B C
|
B=oor
A=oee & aor C=aee |
|
|
assignments - aor intent
|
intent to presently invest rights in C
|
|
|
assignments - K prohibits
|
power to A - courts favor so power to A still exists
so A is valid but right to A - A with no power is breach |
|
|
assignment formation A-> C A
capacity increases oor's risk |
may be invalid - output and requirements K not Aable because it varies duty
|
|
|
assignment formation A-> C A
capacity change duty |
cannot change duty - outputs an requirements
|
|
|
assignment formation A-> C A
capacity increase risk |
cannot increase risk such as insurance and loans not Aable
|
|
|
assignment formation A-> C A
capacity type of rights Aed present and future |
present can be Aed
future existing can be Aed future expectancy - mere expectancy cannot be Aed - nothing to A unless established bus relationship between A an B |
|
|
assignment
performance 3 issues |
A-B deal, effect of assignment, revocation and priorities
|
|
|
assignment performance A-B deal 3 issues
|
conditions, discharge, breach
|
|
|
assignment
performance effect of A B's O to A and B's O to C |
B's O to A is extinguished and B's O to C is formed
|
|
|
assignment
performance effect of A notice required |
yes
|
|
|
assignment
performance effect of A permission required ? unilateral change |
no need to get permission
|
|
|
assignment
performance revocation and priorties 2 types |
revocable or non-revocable
|
|
|
assignment
performance revocation and priorties revocable |
revocable A aor retains right to revoke
|
|
|
assignment
performance revocation and priorties revocable 3 requirements |
oral no writing and gratuitous - no consideration and no token chose like stock cert = freely revocable
|
|
|
assignment
performance revocation and priorities irrevocable |
not meets 3 requirement for revocability
|
|
|
assignment
performance revocation and priorties revocable effect |
last in time
|
|
|
assignment
performance revocation and priorties irrevocable effect |
first in time wins no right to revoke
|
|
|
assignment
performance remedies A v B oee v oor |
no - new duty to perform to C
|
|
|
assignment
performance remedies C v B aee v oor and B's defenses B v A |
direct cause of action stands in shoes of A - defenses are same as B could have raised against A C and A are collapsed into one
|
|
|
assignment
performance remedies C v A aee v aor key |
was there consideration
|
|
|
assignment
performance remedies C v A aee v aor C paid consideration |
implied warranties - based on implied W
|
|
|
assignment
performance remedies C v A aee v aor C paid noconsideration |
no rights
|
|
|
assignment
performance remedies C v A aee v aor C paid consideration -3 issues under implied warranties |
right and defenses
any writings are genuine and enjoyment means no competing A |
|
|
delegation 3 areas of concern
|
formation, performance, remedies
|
|
|
delegation - define
|
delegation of duties - burden is transfered
|
|
|
delegation - when does it happen
|
after A-B deal
|
|
|
delegation - formation 3 issues
|
formation, consideration, defenses
|
|
|
delegation - diagram
|
C->B A delegates duty to C
+ | A-><-B |
|
|
delegation - labels in A-C delegation
|
oee=B
oor=A dor=A C=dee |
|
|
delegation - formation - dee promise consideration required
with A |
A provides Consideration through implied pormise to perform duties
|
|
|
delegation - formation - dee promise consideration required
w/o A |
look for consideration or promise because it is required to complete delegation
|
|
|
delegation - formation - what duties are delegable - commercial K
|
can be delegated unless unique skills or talents - general contractor delegates to sub must supervise
|
|
|
delegation - formation - what duties are delegable - personal
|
non-delegable due to skill or reputation
|
|
|
delegation -performance - 3 issues
|
A-B deal, effect of delegation , effect of dee's performance
|
|
|
delegation -performance - A-B deal
|
look for conditions, discharge or breach
|
|
|
delegation -performance - effect of delegation invalid
|
B can ignore attempt at D and demand a performs - if A refuses A in breach
|
|
|
delegation -performance - effect of dee's performance satisfactory
|
discharges duties of A and C's duties
|
|
|
delegation -performance - effect of delegation valid
|
B must accept C's satisfactory performace
|
|
|
delegation -performance - effect of dee's performance unsatisfactory
|
gives rise to lawsuits - remedies
|
|
|
delegation -remedies
B v A oee v oor - delegation and novation |
delegation= dor secondarily liable to B and C is primarily liable to B - B can sue A or C
novation express or implied then A cannot be sued |
|
|
delegation -remedies
B v C |
can d direct action because B stands in shoes of A and C has same defenses A had
|
|
|
delegation -remedies
A v C dor v dee |
yes if A is still secondarily liable to B - no novation
|
|
|
delegation -remedies
B v A oee v oor - novation |
C is in A shoes limit COA against A releases A - by express or implied conduct
|
|
|
A-C delegation creates what kind of K
|
3rd P K from C to B
|
|
|
formation A-C A
J1 A , famous photographer, agrred to shoot B climbing HD in exchange for promise to pay $10,000 , A incurred expsensesand borrowed $5,000 from . A agrees to pay C $5,000 by B. A and C notified B that in A she would pay A $5,000 and C $5,000 |
A-><-B
| + C<-B |
|
|
J1 A , famous photographer, agrred to shoot B climbing HD in exchange for promise to pay $10,000 , A incurred expsensesand borrowed $5,000 from . A agrees to pay C $5,000 by B. A and C notified B that in A she would pay A $5,000 and C $5,000
B paid $5,000 to A and $5,000 to C can A get additional $5,000 from B |
no - valid A extinguished duty to pay
|
|
|
1 A , famous photographer, agrred to shoot B climbing HD in exchange for promise to pay $10,000 , A incurred expsensesand borrowed $5,000 from . A agrees to pay C $5,000 by B. A and C notified B that in A she would pay A $5,000 and C $5,000
If A fails to show can C sue B and collect $5,000 |
yes but B has rights A had - A breached so C cannot sue
B raises defense of non-perfomance |
|
|
1 A , famous photographer, agrred to shoot B climbing HD in exchange for promise to pay $10,000 , A incurred expsensesand borrowed $5,000 from . A agrees to pay C $5,000 by B. A and C notified B that in A she would pay A $5,000 and C $5,000
labels |
A oee aor
B oor C aee |
|
|
J1 A , famous photographer, agrred to shoot B climbing HD in exchange for promise to pay $10,000 , A incurred expsensesand borrowed $5,000 from . A agrees to pay C $5,000 by B. A and C notified B that in A she would pay A $5,000 and C $5,000
can C sue A |
implied Warranties so yes
|
|
|
delegation
A famous photographer agrees to shot B's climb C is also photographer agrees to shoot B Climb in place of A diagram labels |
A-><-B
B<-C C<-A A oor dor B oee C dee |
|
|
delegation
A famous photographer agrees to shot B's climb C is also photographer agrees to shoot B Climb in place of A Must B accept C's performance for a $5 passport photo and A is not famous |
no because non-delegable duty and yes then delegable personal
|
|
|
delegation
A famous photographer agrees to shot B's climb C is also photographer agrees to shoot B Climb in place of A if B agrees to accept C's performance and C fails to show -who can B sue |
both A (2nd)and C (1st) unless novation
|
|
|
remedies - 3 types
|
damages, restitution, injunction
|
|
|
remedies - damages 3 types
|
liquidated, expectation, reliance
|
|
|
remedies - damages liquidated
|
by clause non implied - must be valid to be enforced must not be punitive = void -
at formation so parties agree what $ would arise from breach 1) damages are damages at breach difficult to prove or uncertain 2) reas estimate of damages at formation |
|
|
remedies - damages expectation - define
|
give A benefit of bargain in $
|
|
|
remedies - damages liquidated huge disparity between estimate and actual damages - trad and modern
|
may be invalid modernly but trad if formation est was reasonable then valid
|
|
|
before remedies what must be shown
|
breach
|
|
|
remedies - damages define
|
put aggrieved party in position they would have occupied if K had been performed - punitives may be available for T but not K
|
|
|
breach w/o damages what kind of remedy is available
|
nominal
|
|
|
remedies basic
|
foreseeable, certain , unavoidable-duty to mitigate
|
|
|
remedies - damages expectation - natural
|
hadley v baxendale - arise naturally
|
|
|
remedies - damages expectation - natural and consequential
|
hadley v baxendale - special knowledge
|
|
|
general measure of expectation damages
|
natural + consequential + incidental - cost avoided/loss avoided
|
|
|
remedies - expectation natural 2 categories
|
sale and services
|
|
|
remedies - expectation natural sale 2 categories
|
RP and goods
|
|
|
remedies - expectation natural RP seller breach
|
K-mkt sandy kofax s for seller
|
|
|
remedies - expectation natural goods - seller remedy
|
K-mkt or resale K-resale or lost volume
|
|
|
remedies - expectation natural RP buyer breach
|
Mkt-K billy martin b for buyer
|
|
|
remedies - expectation natural goods - buyer remedy
|
mkt at time of K-K
|
|
|
remedies - expectation natural goods - seller remedy lost volume
|
car dealer- infinite supply 1 buyer breaches - sell to 2nd buyer - seller gets lost profits from breached sale
|
|
|
remedies - expectation natural goods - buyer remedy cover
|
cover-K w/o unreas delay in GF
|
|
|
remedies - expectation natural goods - seller remedy - buyer breach identified goods - seller cannot sell
|
buyer has to buy - seller has o hold for buyer
|
|
|
remedies - expectation natural services 2 areas
|
employment and construction
|
|
|
remedies - expectation natural services - employment eer breach eee remedy
|
lost wages - earnings - mitigate seek substitute employment - look for tort punitives
|
|
|
remedies - expectation natural services - employment eee breach eer remedy
|
extra cost to substitute hire
|
|
|
remedies - expectation natural services - construction - builder's remedy
|
profit + costs - mitigate stop work when learn of owners breach - costs after not recoverable
|
|
|
remedies - expectation natural services - construction - owners remedy
|
cost of completion over K price but dimin in value is cost of completion is disproportionate- reeding pipe
|
|
|
remedies - consequential damages 2 requirements
|
foreseeable by breachor at time of formation
|
|
|
remedies - consequential damages - standard
|
objective - knew or should have known damages would arise - at formation
|
|
|
remedies - consequential damages 2 elements
|
foreseeable and certain
|
|
|
remedies - consequential damages - new bus - establish bus - certainty
|
new cannot be established with certainty but established likely can rules of thumb
|
|
|
remedies - consequential damages 2 elements
|
1) foreseeable at time of formation by bor 2) certain
|
|
|
remedies - reliance damages
|
cannot get full measure - backup out of pocket loss
|
|
|
remedies - reliance damages 2 circumstances to look out for
|
1) no consideration - PE may spend $ 2) expectation damages are too uncertain
|
|
|
protected K interests - diagram expectation
|
A-> <-XB benefit of bargain in $
|
|
|
protected K interests - diagram
reliance |
X
| A ----->B B<-A A D/R out of pocket loss $ |
|
|
protected K interests - diagram restitution
|
A-X>B
A<----B avoid unjust enrichment - B no return performance - restore to A the value of the benefit A conferred on B |
|
|
remedies - restitution 2 issues
|
grounds, measure of recovery
|
|
|
remedies - restitution
|
mistake breach and unenforceable K
|
|
|
remedies - restitution
grounds mistake |
A confers B through mistake so court should return
|
|
|
remedies - restitution
grounds breach |
breachor and breachee both have rights
|
|
|
remedies - restitution
grounds unenforceable K |
down payment on house in K that later fails
|
|
|
remedies - restitution
measure of recovery 2 categories |
breach and unenforceable K - down
|
|
|
remedies - restitution
measure of recovery - breach aggrieved party |
value conferred to B - often $ deposit but non-money then cost avoided that is what breachor would have spent to get benefit - disgorgement
|
|
|
remedies - restitution
measure of recovery - breach breachor |
value benefit conferred - damages except min willful breach nada but min vlue conferred - damages
|
|
|
remedies - restitution
measure of recovery - unenforceable K - goods and services |
goods specific value
services reas value |
|
|
specific restitution
|
remedy for unenforceable K subject matter goods
|
|
|
quantum meruit
|
reas value of services in restitution unenforceable K
|
|
|
remedies - injunction 3 categories
|
liability theory, special requirements, defenses
|
|
|
remedies - injunction define
|
make A whole - benefit of bargain in performance - court compels B to perform - equitable remedy
|
|
|
remedies - injunction - liability theory - formation
|
proper formation - higher standard for SP must be definite and certain - K to build 1st class theater too vague
|
|
|
how enforce SP order
|
contempt
|
|
|
remedies - injunction - liability theory - performance
|
marketable title, ToE, aee's note, Abatement
|
|
|
remedies - injunction - liability theory - special requirements 3
|
inadequate legal remedy, feasible decree, mutuality of remedy
|
|
|
remedies - injunction - SP - special circumstances
inadequate legal remedy - sale and personal |
RP sale land is unique so SP is favored - $ not adequate,
PP sale usually $ damages are adequate except unique art book etc |
|
|
remedies - injunction - Sp - special circumstances -feasible decree
|
jurisdictional problem - order in other state RP
|
|
|
remedies - injunction - SP special circumstances
inadequate legal remedy - personal services |
usually $ damages are adequate except unique skills, talents famous etc
|
|
|
remedies - injunction - lSP - special circumstances
inadequate legal remedy - sale of goods UCC 2-709 and 2-710 |
look them up - SP appropriate - identified goods
|
|
|
remedies - injunction - SP - special circumstances
feasible decree requirements jurisdiction |
personal J over party ordered to perform, or in rem J over land
|
|
|
remedies - injunction - SP - special circumstances
feasible decree requirements supervision - construction trad and modern |
trad - too hard for court to compel
modern - less reluctant supervision can be overcome |
|
|
special circumstances
feasible decree requirements supervision - personal services affirmative or enforce negative covenant |
no affirmative - involuntary servitude - hostile environment
enforce negative covenant - cannot compete court may enforce express or implied limited by eee cannot make a living |
|
|
remedies injunction SP mutuality of remedy trad
|
trad turn tables is strict mutuality
for A to get P from B B must be able to get P from A |
|
|
remedies injunction SP mutuality of remedy modern
|
old rule relaxed security for performance
A must show their own performance has been substantially rendered or can be scures |
|
|
remedies injunction SP
recission and reformation difference |
recission no valid bargain - termination
reformation valid bargain - redo writing to represent bargain |
|
|
remedies injunction SP recission grounds 2
|
misrepresentation or mistake
|
|
|
remedies injunction SP defense 2 types
|
defense to enforcement ad equitable
|
|
|
remedies injunction SP defenses K SOF
|
land sale valid writing required or part performance through payments or improvements
|
|
|
remedies injunction SP defenses equitable 3
|
laches unfairness or BFP
|
|
|
remedies injunction SP defenses equitable laches
|
unreas delay by A in asserting rights that prejudiced B SOL is absolute bar but laches unreas delay could be shorter - turns on reasonableness
|
|
|
remedies injunction SP defenses equitable unfairness 3
|
1) unclean hands A's conduct BF?, hardship inadequate consideration and A in superior bargaining position, misrepresentation or mistake
|
|
|
remedies injunction SP defenses equitable BFP
|
BFP - in GF paid $ breachor has sold land or unique chattel to BFP cannot force to SP - cuts off equity of A
|
|
|
remedies - injunction recission - grounds 2
|
1) mistake or 2) misrepresentation
|
|
|
remedies - injunction recission - grounds misrepresentation 3 issues
|
type, culpability, materiality/ relaince
|
|
|
remedies - injunction recission - grounds misrepresentation type
|
fact = express oral or written misrepresentation or
silent = active concealment w confidential relationship |
|
|
remedies - injunction recission - grounds misrepresentation culpability 2 types
|
negligent or intentional
|
|
|
remedies - injunction recission grounds misrepresentation opinion
|
generally not but could be if either expert or confidential relationship
|
|
|
remedies - injunction recission grounds misrepresentation culpability negligent or intentional where to sue
|
election to sue in K or tort cannot do both
|
|
|
remedies - injunction recission grounds misrepresentation culpability inocent
|
recission only
|
|
|
remedies - injunction recission grounds misrepresentation culpability materiality and relaince
|
reas person would agree it is material and justified relaince are grounds for recission
|
|
|
remedies - injunction rescission grounds mistake 2 types
|
mutual and unilateral
|
|
|
remedies - injunction rescission grounds mistake mutual
|
both parties mistaken as to essential terms of K and either P can seek rescission and restitution
|
|
|
remedies - injunction rescission grounds mistake unilateral maj and min
|
relief may not be grant except MAJ non-mistaken party knows or should have known of mistake and
MIN does hardship out weigh expectation |
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remedies - injunction rescission grounds mistake materiality basic assumption
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1) goes to essence of subject matter but not just value or quality - collateral value or quality
2) no assumption of risk of error |
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remedies - injunction rescission - reformation grounds 2 requirements
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1) prior agreement 2) error in writing either mistake or fraud
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remedies - injunction rescission - reformation - defense good
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good laches, unclean hands, election of remedies and estoppel = prevent reformation or rescission
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remedies - injunction rescission - reformation - defense bad
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negligence and Parol E - will not prevent rescission or reformatin
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remedies - injunction rescission - reformation - defense good election of remedies
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K first if lose then sue in tort but tort first deems K affirmed so cannot then sue for rescission of K
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remedies - injunction rescission - reformation - defense good - estoppel
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if A discovers ground for rescission but indicates intention through words or conduct to affirm K then they are estopped to rescind
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K defense - rescission or reformation is negligence a defense
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no
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can Parl E be admitted in rescission or reformation
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yes the rule is no bar
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