Contracts

Front 1

Overview of the entire contracts subject

Back 1

A Applicable law

F formation

T terms

P performance

R remedies for unexcused non performance

E excuse of nonperformance

T third party problems
R

Front 2

Quasi contract elements

Back 2

1- P has conferred a benefit on D

2- P reasonably expected to be paid

3- D realized unjust enrichment if P not compensated.

K price not measure of recovery

K price is ceiling if P is in default

Front 3

4 ways an offer can be terminated:

Back 3

1) Lapse of time

2) Death or incapacity of either party

3) Words or Conduct of offeror Revoke the offer

4) words or conduct of offeror

Front 4

An offer cannot be revoked if there has been

Back 4

1) reliance that is

2) reasonably foreseeable and

3) detrimental

Front 5

If no valid acceptance of a common law contract but parties conduct demonstrates a contract what happens?

Back 5

under CL, the conduct is treated as an acceptance of a counteroffer and so the parties are bound by the additional term in the acceptance.

Front 6

When full performance operates as an acceptance what factors do you look at to see whether notice of performance is required?

Back 6

1) what does the offer require

2) whether offeree has reason to believe that offeror will not learn of the acceptance.

Front 7

Start of performance is generally an ____________ of an offer

Back 7

Acceptance

Front 8

Acceptance under UCC can be by either __________________ OR ---------------------------------

Back 8

Promise to ship, or shipment

Front 9

Shipment of the wrong goods to buyer is generally a ____________________

Back 9

Acceptance and a Breach

we want contract to form so we can hold seller liable under the contract

ACCOMODATION (explanation)

1) counteroffer and no breach.

Front 10

Legal Reasons for not enforcign an agreement are:

Back 10

1) lack of consideration or consideration substitute

2) incapacity

3) statute of frauds

4) illegality

5) public policy

6) misrepresentations

7) nondisclosure

8) duress

9) unconscionability

10) ambiguity in words of agreement

11) mutual or sometimes unilateral mistake.

Front 11

offer

Back 11

promise undertaking or commitment with definite and certain terms communicated to offeree

Front 12

A written promise to satisfy an obligation for which there is a legal defense is enforceable without consideration but there must be a ________________

Back 12

signed writing/ subject to SOF.

Front 13

Promissory Estoppel:

Back 13

1) promise
2) reliance that is reasonable, detrimental, and foreseeable
3) enforcement necc to avoid injustice.

Front 14

Statute of Frauds

Back 14

M Y L E G S

1) Marriage - K's in contemplation of

2) Services that cannot be performed within a year

3) Land Sale Contracts

4) Executor's promise to pay estate out of his pocket

5) Goods for $500 or more

6) Suretyship K's to answer for the debts of another.

Front 15

When is Statute of Frauds Not Applicable?

Back 15

1) to the extent that other side has admitted in court that K was performed.

2) to extent there was Part Performance. (goods only)
(services) need full performance

3) In the sale of land if there is performance that unequivocally indicates that parties contracted for the sale of land.
- payment in whole or in part
- major or valuable improvements.

SPECIALLY MANUFACTURED GOODS:

SOF satisfied as soon as seller makes a substantial beginning

Front 16

Merchant Exception to the Statute of Frauds Rule

Back 16

1) Person who receives a signed writing with a quantity term that claims there is a contract and then fails to respond within 10 DAYS of receipt - NO SOF DEFENSE

Front 17

Equal Dignity Rule

Back 17

Only if contract being authorized so sign or execute is within the statute of frauds.

Front 18

Requirements requiring modifications to be in writing. When are they effective?

Back 18

CL- no

UCC- effective unless waived

Note: modifications that bring the K within the SOF must be inwriting.

Front 19

MisrepresentatioN/

Back 19

False assertion of fact that induces the contract. No wrongdoing required.

Front 20

Ambiguity in Words of Agreement, what are the elements to not enforce the agreement?

Back 20

1) parties used a MATERIAL term that is open to atleast two reasonable interpretations

2) each party attaches a different meaning to the term

3) neither party knows or has reason to know the term is open to atleast two reasonable interpretations.

- if other party knows of the ambiguity then K is enforceable according to terms of the party without knowledge of the ambiguity.

Front 21

Mutual Mistake

Back 21

1) both parties mistaken

2) basic assumption of fact

3) materially affects agreed exchange and

4) not a risk that the party trying to get out of the deal bears.

Front 22

Reformation;

Back 22

Equitable action to modify written contract to reflect actual agreement.

Front 23

What evidence is admissable despite the parol evidence application to a final integrated writing?

Back 23

1) formation defects
2) existence of condition precedent to the contract
3) parties' intent regarding ambiguous terms
4) consideration problems
5) prior valid agreement which (as by mistake) is incorrectly reflected in the writing
6) a collateral agreement if it does not contradict or vry the main contract and if it is not so closely connected as to be part of the main contract

Front 24

Delivery Obligations of Seller if Delivery by Common Carrier?

Back 24

SHIPMENT K
1) get the goods to a common carrier , and

2) obtain a contract for their shipment

3) promptly notify buyer

DESTINATION K

Seller doesnt' complete his delivery obligation until the goods arrive where the buyer is.

Front 25

If the seller is a merchant in a non common carrier delivery contract when does the risk of loss pass from the merchant seller to the buyer

Back 25

1) upon buyer's receipt of the goods

For a non-merchant seller

1) when she tenders the goods

Front 26

Right to Rejection in Single Delivery Contracts.

Back 26

Accept all, reject all, or accept any commercial units and reject the rest.

Front 27

Seller's right to cure

Back 27

Where a buyer has rejected, a seller may, within the time originally provided for performance, "cure," by

1) notifying buyer he intends to cure; and

2) making a new tender of conforming goods, which the buyer must then accept.

Note: seller may cure after the contract delivery date if he has reasonable grounds for believing his improper tender would be acceptable (w/ money allowance)

Front 28

Installment Contracts

Back 28

1) each installment is to be separately accepted.

Buyer may reject an installment where there is a substantial impairment in that installment that cannot be cured

Front 29

Revocation of Acceptance?

Back 29

1) nonconformity substantially impairs value of the goods

2) excusable ignorance of grounds for revocation or reasonable reliance on seller's assurance of satisfaction

3) revocation was reasonable in time after discovery

Front 30

What iss the right of reclamation in a UCC contract?

Back 30

right of an unpaid seller to get its goods back

- buyer must have been insolvent at time he received the goods, AND

- seller demands return of goods within 10 days of receipt "becomes reasonable time rule" if buyer made express representation of solvency to seller AND

3) buyer still has goods at the time of demand.

Front 31

What is the remedy if Seller breaches and buyer keeps the goods?

Back 31

Fair Market value if perfect minus Fair Market Value as delivererd

Front 32

If seller breaches and seller has the goods what is the remedy and duties of the buyer?

Back 32

Remedy:

Fair Market valuue at time of discovery of the breach minus Contract price OR

Replacement Price minus Contract price

Front 33

Buyer breaches and Seller has the goods?

Back 33

Difference between the K price and the fair market price at time and place of delivery OR

Difference between the contract price and the resale price

Note: sometimes lost profits if a lost volume seller

Front 34

Divisible contract exception?

Back 34

May recover for substantial performance of a divisible part even though there has been a material breach of entire K. One factor will be whether payment is stated as a lump sum or on a per performance basis.

Front 35

Anticipitory Repudiation:

Back 35

1) an unequivocal statement by the other party that he will not or cannot perform

RESULT:

1) Excuses other party's duty to perform it also generally gives rise to an immediate claim for damages for breach UNLESS claimant has already finished her performance.

Anticipitory Repudiation can be retracted so long as their has not been a material change in position by the other party on reliance. This may trigger adequate assurances.

Front 36

Adequate Assurances:

Back 36

Words or conduct make party's performance uncertain. If reasonable grounds for uncertainty party can

1) demand adequate assurances in writing

2) suspend performance on the contract until receipt of such assurances.

Front 37

Third Party beneficiaries, name and define the parties.

Back 37

1) 3PB not a party to the contract. Able to enforce K others made for his benefit.

2) Promisor:

Person making the promise that benefits the 3PB

3) Promisee

Person who obtains the promise that benefits the 3PB

Only Intended parties have K law rights.

Efforts to cancel or modify 3PB contract:

1) look at vesting
2) 3PB assents to the K in the manner called for in the contracts or she brings suit on the promise, or there is material reliance on the promise.

Front 38

Who can sue him in a 3PB contract?

Back 38

Promisee can sue promisor for damages

3pb cannot recover from Promisee unless 3PB is a creditor beneficiary and he may recover on the pre-existing debt.

Front 39

State the difference between a 3PB contract and an Assignment?

Back 39

3PB contract either states the 3PB in the contract or person is in the minds of the parties prior to execution of K.

Assignment arises after the parties have contracted and party to K transfers rights or benefits of K to another

Front 40

When is an assignment of performance under a contract invalid.

Back 40

assingments that would substantially change the obligor's duty or risk

an assignment of future rights to arise from future contracts.

Front 41

Name the parties who can sue whom in an Assignment of Contract rights

Back 41

Assignee v. Obligor

Assignee is entitled to performance of K

Obligor may raise any defenses inherent in the K against assignee but not defenses assignor might have against assignee.

Assignee v. Assignor

1) if Obligor successfully asserts defense against assignor in an action brought by assignee against obligor to enforce the K.

2) assignor not liable to assignee if obligor is incapable of performing.

Front 42

What are the exceptions to the rule that a party may freely delegate his duties under a contract?

Back 42

1) duties involve personal judgment and skill

2) delegation would change obligee's expectancy

3) special trust was reposed in the delegator by the other party in the contract; and

4) there is a contractual restriction on delegation.

Front 43

A clause prohibiting "assignment of the contract" will be construed as?

Back 43

Only prohibits delegation of assignor's duties

Whereas a contract prohibiting contractual rights generally does not bar assignment but merely gives the obligor right to sue for damages

If use the word void, however, parties can bar assignment.

Front 44

Implied Warranties of an Assignor for Value

Back 44

1- Right assigned actually exists.

2- right assigned not subject to any defenses by the obligor

3- the assignor will do nothing to impair the value of the assignment.

Front 45

When is a delegatee to a contract liable for his nonperformance?

Back 45

He is liable only if he received consideration from the delegator

Front 46

A delegation for consideration to a 3rd party creates what type of issue with the obligee

Back 46

3rd party beneficiary