Contracts Restatement Review

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265 Discharge by Supervening Frustration

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Duties discharged if:
1) Party's principal purpose is frustrated, 2) the frustration is substantial, and 3) non-occurrence of the frustrating event must have been a basic assumption on which the contract was made.

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74 Settlement of Claims

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Forebearance to assert or surrender of a claim or invalid defence is NOT consideration if: OBJECTIVE claim is doubtful in fact or law SUBJECTIVE forebearing party believes claim or defense is valid.

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71 Requirement of Exchange

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MANIFESTATION OF INTENTION TO INDUCE OTHER'S RESPONSE AND TO BE INDUCED BY IT AND THE OTHER RESPONDS IN ACCORDANCE WITH THE INDUCEMENT.

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69 Acceptance by Silence

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Silence is NOT acceptance unless offeree could have rejected, K said silence was OK as acceptance, previous dealing suggest silence is OK

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79 Adequacy of Consideration; Mutuality of Obligation

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no mutuality required, no equivalence in value of consideration exchanged

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77 Illusory and Alternative Promises

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An illusory promise is not consideration. couple of exceptions.

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51 Effect of Part Performance Without Knowledge of Offer

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Unless offeror says otherwise, an offeree who learns of offer AFTER he has rendered partial performance may accept the offer by completing performance.

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90 Promise Reasonably Inducing Action or Forbearance

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Promissory estoppel: if the promisor should reasonably expect reliance on the promise by the promisee, and if the promise is not kept the promisor has breached contract is breached and "remedy granted for breach may be limited as justice requires." Unless there is unjust enrichment of the promisor, promissee shouldn't be put in a better position thatn the performance of the promise would have put him.

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2-206 Offer and Acceptance n Formation of Contract

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(1)(a) UNLESS otherwise stipulated, offer invites acceptance by any method
(1)(b) Order to buy goods invites acceptance by promise to ship, or by shipping conforming or non-conforming goods, BUT shipment of non-conforming goods doesn't constitute acceptance if the seller seasonably notifies the buyer that the shipment is only offered as an accomodation to the buyer.
(2) Where beginning perf is reasonable mode of acceptance, offeror who is not notified of the acceptance within a reasonable time may treat the offer as having lapsed.

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2-207 Additonal Terms in Acceptance or Confirmation (Battle of the Forms)

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(1) A definite and seasonable expression of acceptance or a written confirmation which is sent within a reasonable time operates as an acceptance EVEN THOUGH it states terms additional to or different from those offered or agreed upon, unless acceptance is expressly made conditonal on assent to the additional or differerent terms.
(2) The additional terms are to be construed as proposals for addition to the contract. Between merchants such terms become part of the contract UNLESS:
(a) the offer expressly limits acceptance to the terms of the offer
(b) they materially alter it
(c) notification of objection to them has already been given or is given within a reasonable time after notice of them is received.
(3) Conduct by both parties which recognizes the eixtence of a contract is sufficient to establish a contract for sale although the writings of the parties do not otherwise establish a contract. In such case the terms of the particular contract consist of those terms on which the writings of the parties agree, together with any supplementary terms incorporated under any other provision of this Act. SEE FLOWCHART.

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2-209 Modification, Recission and Waiver

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(1) An agreement modifying a contract withing this Article needs no consideration to be binding.
(2) A signed agreement whcih excludes modification or recission except by a signed writing cannot be otherwise modified or rescinded, but except as between merchants such a requirement on a form supplied by the merchant must be separately signed by the other party.
(3) The requirements of the statute of frauds seciotn of this article (Section 2-201) must be satisfied if the contract as modified is within its provisions.
(4) Although an attempt at modification or recission does not satisfy the requirements of subsection (2) or (3) it can operate as a waiver.
(5) A party who has made a waiver affecting an executory portion of the contract may retract the waiver by reasonable notification received by the other party that strict performance will be required of any term waived, unless the retraction would be unjust in view of a material change of position in reliance on the waiver.

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32 Invitation of Promise or Performance

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If it's not spelled out, offeree chooses. Mimics UCC 2-206

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54 Acceptance by Performance; Necessity of Notification to Offeror

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(1) When offer invites acceptance by perf, no notification is necessary unless the offer asks for notification
(2) If offeree knows the offeror has no adequate means of knowing he started performing, duty of offeror is discharged UNLESS offeree makes diligent effort to notify offeror, or the offeror learns of the perf in a reasonable time, or offer says notification of perf is not required.

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56 Acceptance by Promise; Necessity fo Notification to Offeror

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Offeree has to notify offeror of acceptance seasonably or if the offeror receives that notice seasonably in some other way.

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344 Purposes of Remedies

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1) Expectation: promissee is put in as good a position as he would have been in had the contract been performed
2) Reliance: promisee is put in as good a position as he would have been had the contract not been made
3) Restitution: promisee has restored to him any benefit conferred to the other party.

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50 Acceptance of Offer Defined; Acceptance by Performance; Acceptance by Promise

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(1) Acceptance is manifestation of assent in the manner invited
(2) Acceptance by perf requires at least part of what the offer requests be perf.
(3) Acceptance by promise requires offeree complete every act essential to the making of the promise.

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62 Effect of Performance by Offeree Where OFfer Invites Either Performance or Promise

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beginning perf is acceptance where acceptance by perf is invited, but once started the acceptance operates as a promise to complete the perf

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43 Indirect Communication of Revocation

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An offeree's power of acceptance is terminated when the offeror takes definite action inconsistent with an intention to enter into the proposed contract AND the offeree acquires reliable information to that effect.

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59 Purported Acceptance Which Adds Qualifications

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A reply to an offer which purports to accept it but is conditonal on the offeror's assent to terms additional to or different from those offered is a counter offer.

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45 Option Contract Created by Part Performance or Tender
(Brooklyn Bridge example)

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(1) Where an offer invites an offeree to accept by rendering a performance and does NOT invite a promissory acceptance, an option contract is created when the offeree tenders or begins the invited performance or tenders a beginning of it.
(2)The offeror's duty of performance under any option contract so created is conditonal upon completion or tender of the invited performance in accordance with the terms of the offer.

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87 Option Contract

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(1) an offer is binding as an option contract if it
(a) is in writing and signed by the offeror, recites a purported consideration for the making of the offer, and proposes an exchange on fair terms within a reasonable time; or
(b) is made irrevocable by statute.
(2) An offer whcih the offeror should reasonably expect ot induce action or forbearance of a substantial character on the part of the offereeand which does induce such action or forbearance is binding as an option contract to the extent necessary to avoid injustice.

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90 Promise Reasonable Inducing Action or Forebearance

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(1) A promise by which the promisor should reasonably expect to induce action or forbearance on the part of the promisee or a third person and which does induce such action or forebearance is binding if injutice can be avoided only be enforecement of the promise. The remedy granted for breach may e limited as justice requires.

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73 Performace of a Legal Duty (Pre-existing legal duty rule)

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Performance of a legal duty owed to a promisor which is neither doubtful nor the subject of honest dispute is not consideration...

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89 Modification of Executory Contract (adjustments in ongoing transactions)

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A promise modifying a duty under a contract not fully perfomed on either side is binding
(a) if the modification is fair and equitable in view of circumstances not anticipated by the parties when the contract was made; or
(b) to the extent provided by statute; or
(c) to the extent that justice requires enforcement in view of material change of position in reliance on the promise.

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15 Mental Illness or Defect

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(1) A person incurs only voidable contractual duties by entering into a transaction if by reason of menatl illness or defect
(a) he is unable to understand in a reasonable manner the nature and consequences of the transaction or
(b) hi is unable to act in a reasonable manner in relation to the transaction and the other party has reason to know of his condition.

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211 Standardized Agreements

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Surprise agreements aren't included. Attempt to remove unfair provisions for consumers.

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205 Duty of Good Faith and Fair Dealing

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Every contract imposes upon each party a duty of good faith and fair dealing in its performance and its enforcement.

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350 Avoidability as a Limitation on Damages

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(1) Except as stated in Subsection (2), damages are not recoverable for loss that the injured party could have avoided without undue risk, burden or humiliation.
(2) The injured party is not precluded from recovery the the rule stated in Subsection (1) to the extent that he has made reasonable but unsuccessful efforts to avoid loss.

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351 unforeseeability and Related Limitations on Damages

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(1) Damages are not recoverable for loss that the party in breach did not have reason to foresee as a probable result of the breach when the contract was made.
(2) Loss may be forseeable as a probable result of a breach becaouse it follows from the breach
(a) in the ordinary course of events, or
(b) as a result of special circumstances beyond the ordinary course of events, that the pary in breach had reason to know.

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152 When Mistake of Both Parties Makes a Contract Voidable

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(1) Where a mistake of both parties at the time a contract was made as to a basic assumption on which the contract was made has a material effect on the agreed exchange of performances, the contract is voidable by the adversely affected party unless he bears the risk of the mistake under the rule stated in 154.
(2) In determining whether the mistake has a material effect on the agreed exchange of performances, account is taken of any relief by way of reformation, restitution, or otherwise.

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376 Restitution When Contract is Voidable

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A party who has avoided a contract on the ground of lack of capacity, mistake, misrepresentation, duress, undue influence or abuse of a fiduciary relation IS ENTITLED TO RESITUTION for any benefit that he has conferred on the other party by way of part performanace or reliance.

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154 When a Party Bears the Risk of a Mistake

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A party bears the risk of a mistake when
(a) The risk is allocated to him by agreement of the parties, or
(b) he is aware, at the time the contract is made, that he has only limited knowledge with respect to the facts to which the mistake relateds but treats his limited knowledge as sufficient, or
(c) the risk is allocated to him by the court on the ground that it is reasonable in the circumstances to do so.

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151 Mistake Defined

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A mistake is a belief that is not in accord with the facts.

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261 Discharge by Supervening Impracticability

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Where, after a contract is made, a party's performance is made impracticable without his fault by the occurrence of an event the non-occurrence of which was a basic assumption on which the contract was made, his duty to render that performance is discharged, unless the language or the circumstnaces indicate the contrary.

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265 Discharge by Supervening Frustration

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Where, after a contract is made, a party's principal purpose is substantially frustrated without his fault by occurrence of an event the non-occurrence of which was a basic assumption on whicht eh contract was made, his remaing duties to render performance are discharged, unless the language or the circumstances indicate the contrary.

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272 Relief Including Restitution

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(1) In any case governed by the rules stated in this Chapter, either party may have a claim for relief including restitutin under the rules in 240 and 377.
(2) In any ase governed by the rules stated in this Capter, if those rules together with the rules stated in Chapter 16 will not avoid injustice, the court may grant relief on such terms as justice requires including protection of the parties' reliance interests.