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7 Cards in this Set
- Front
- Back
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A contract for the sale of horsemeat scraps calls for a “minimum 50% protein.” Both parties know that in their trade, 49.5% is treated as the equivalent of 50%.
Is this relevant to the court’s interpretation of the parties’ contract? |
Yes. This is relevant to the court’s interpretation because usage of trade is considered under both the UCC and the common law.
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Andy agrees to disclose to Bonnie’s company his secret formula for an antiseptic liquid in exchange for the company’s agreement to pay him monthly royalties based on the amount of the liquid sold. Fifty years later the formula was published in a medical journal. Bonnie’s company continued to pay Andy’s heir royalties for another 25 years, but then stopped, claiming that its duty to pay ended when the formula ceased to be secret.
Is the fact that Bonnie’s company continued to pay after the formula was published relevant to the court’s interpretation of the parties’ contract? |
Yes. This is relevant to the court’s interpretation because course of performance is considered under both the UCC and the common law.
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Andy writes Bonnie a letter offering to contract with her. The letter contains four provisions. Bonnie replies by letter that three of the provisions are accepted, but she makes a counter proposal for the fourth provision. During a subsequent phone call, they agree on a revision to the fourth provision, but do not discuss the other three provisions at all.
Is Andy’s original letter an unintegrated, partially integrated, or totally integrated agreement? |
It is partial. It was intended to be the parties’ final agreement as to the three provisions, but it was not intended to be the final agreement as to the fourth.
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Bonnie and Andy enter into an integrated, written contract whereby Bonnie has agreed to sell and Andy has agreed to buy “Bonnie’s horse.” Bonnie has two horses.
Will the parties be allowed to testify that they meant the same horse? |
Yes. Under any of the approaches to interpretation, the judge would likely find that there was an ambiguity here, and the evidence would not be contrary to the writing.
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Andy owes Bonnie $1,000. They agree orally that Andy will sell Bonnie Blackacre for $3,000 and that the $1,000 will be credited against that price. They then sign a written agreement for the sale of Blackacre, complete on its face, which does not mention the $1,000 debt or the credit.
Is the agreement completely integrated? Will the court allow evidence regarding the $1,000 credit to supplement the writing? |
The document is not completely integrated because it does not include the entire agreement of the parties regarding the sale of Blackacre. Because it is partially integrated, the evidence of the oral agreement will be admitted as long as it is consistent with the terms incorporated into the agreement. See Restatement 2nd § 216.
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Andy and Bonnie sign a standard-form, written agreement for the sale of goods. It is complete on its face except that a blank for the time and place of delivery is not filled in. Bonnie claims that, at the time that the written document was entered into, there was an oral understanding that delivery would be made within 30 days at the buyer’s place of business.
Is the agreement completely integrated? Will the court allow evidence regarding the time and place of delivery to supplement the writing? |
Under the UCC, we would presume that this is a partial integration. Because the evidence regarding the time and place of delivery is not inconsistent with the writing (it’s blank), the evidence will be allowed to supplement the writing. See UCC § 2-308 and § 2-309 (reasonable time, seller’s place of business if the parties did not agree otherwise).
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Andy and Bonnie sign a written agreement for the exchange of real property and leave the agreement with Chris, an attorney, on the oral understanding that it will not take effect until each has consulted with his or her spouse.
Will the court allow evidence of this oral agreement to be considered? |
Yes. This is oral evidence related to the formation of a K. The parol evidence rule would not exclude this testimony. See Restatement 2nd § 217.
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