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73 Cards in this Set
- Front
- Back
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Formal elements for contract in DE?
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1. mutual assent to the terms of the agreement
2. the existence of consideration |
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Determining what substantive law governs Ks in DE?
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Most Significant Relationship Test
4 factors: 1. Place of contracting 2. place of negotiation of the K 3. subject matter of the K, and 4. domicile, residence, nationality, place of incorporation, and place of biz of the parties of the K |
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When will contractual choice of law provisions be honored in DE?
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When jurisdiction bears a material relationship to the transaction
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What law governs formation and validity in DE?
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Law of place where K is formed.
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What is an implied-in-fact K under DE law?
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A K will be implied in fact where a court may fairly infer the intent to contract from the evidence.
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What is an implied K under DE law?
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a K where the law infers the existence of a contractual relationship from the conduct of the parties, rather than their words.
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What is an implied-in-law K under DE law?
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Ks implied in certain regards without regard to the actual intentions of the parties.
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What is quasi-K under DE law?
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Quasi-contractual situations are imposed by law to work justice without reference to actual intentions of the parties, and are based upon unjust enrichment
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contracts-- Definition of unjust enrichment in DE?
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unjust retention of a benefit to the loss of another, or the retention of money or property of another against the fundamental principles of justice or equity and good conscience.
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contracts -- Determining existence of unjust enrichment in DE?
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5 factors: [E-I-R-JAR]
1. an enrichment of one party 2. an impoverishment of other party 3. a relation between the enrichment and impoverishment 4. the absence of a justification 5. absence of a remedy provided by law. |
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DE law on contract to make a K in the future?
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agreement must specify all material and essential terms including those to be incorporated into future K.
Mere agreement to agree is not enough. |
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DE law on agreements to negotiate in good faith?
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Parties may enter into them.
Breach does not arise from failure to come to agreement, but from failure to negotiate in good faith. |
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DE law on an oral agreement to enter into a written agreement.
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Parties can bind themselves to an oral agreement to execute a written agreement provided terms are fully agreed upon.
Courts may not twist an expression of condition willingness to agree into an actual enforceable K. |
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Definition of option in DE?
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A continuing offer made irrevocable for a fixed period of time, when given for present consideration.
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DE courts on arbitration?
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1. strong public policy in favor of arbitration.
2. any doubt as to arbitrability is to be resolved in favor of arbitration. |
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Who decides procedural arbitrability issues? Who decides substantive arbitrability issues?
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1. procedural arbitrability issues presumptively are for the arbitrator to decide.
2. Substantive arbitrability issues presumptively are for the court to decide. |
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Defeating presumption re: procedural v. substantive arbitrability issues?
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1. Presumption is defeated where there is clear and unmistakable evidence that parties intended otherwise.
2. Two conditions are satisfied: (i) K generally refers all disputes to arbitration; and (ii) K refers to a set of rules that would empower arbitrators to decide arbitrability. |
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When are Ks "under seal" under De law?
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[BREE]
1. K must contain language to that effect in body of K 2. a recital affixing the seal 3. extrinsic evidence showing parties' intent to conclude a sealed K. Exception --> Documents of debt (such as mortgages and PNs) need only contain minimal references to a seal. |
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Is testimonium clause enough to create a K under seal?
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No. E.g., of testimonium clause -- "in witness whereof the parties have set their hand and seal as of the day of the year first written above."
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DE SOL provisions relevant to Ks?
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1. 3 years for breach of K actions
2. 6 years to enforce PN 3. No SOL for Ks under seal. 4. 1 year for actions arising from an EE's claim for wages, salary or other benefits for services performed. NOTE --> Parties may agree to a shorter SOL if reasonable, but can never lengthen the statutory SOL period through private agreement. |
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DE & antenuptial Ks
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Though governed by general K law, courts will examine more closely given the nature of mutual trust and confidence that the parties to the agreement assume
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contracts -- DE on contracts to marry?
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No action available for breach of such agreements.
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DE's Doctrine of Necessaries
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Spouse may be liable for a K for necessaries entered into by his or her spouse if he or she expressly authorized or assented to the K.
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What is an OFFER under DE law?
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signification by one person to another of his willingness to enter into a K with him on the terms specified in the offer.
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What is an acceptance in DE?
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1. An overt manifestation of assent,
2. identical with the offer 3. and unconditional |
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DE's theory of Ks?
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Objective Theory of Ks --> It is a party's objective intent, its overt manifestations, which determine the existence of a K, rather than a party's subjective intent.
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Party to K who does not read K in DE?
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Still bound to agreement despite not reading
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contracts -- Signature by some but not others in DE?
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Parties signing are bound unless agreement is conditioned on signatures of all.
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Delivery requirement in DE?
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Execution of an instrument must be accompanied by intentional delivery to give it binding validity against party executing it.
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Definition of consideration in DE?
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1. Fundamental element of consideration is that it be bargained for.
2. consideration consists of either a benefit to promisor, or of a detriment to promisee. |
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Illusory promises in DE?
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A promise that is an illusion, existing in form but not in substance, is not sufficient consideration.
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Pre-existing duty rule in DE?
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Doing what a promisor is already bound to do by law constitutes no consideration.
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Promise to forebear as consideration in DE?
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A promise to forebear what one is legally entitled to do is valid consideration
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Elements of PE in DE
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P must show by CLEAR AND CONVINCING EVIDENCE:
1. a promise was made 2. reasonable expectation of promisor to induce action or forebearance on the part of the promisee 3. promisee reasonably relied on promise and took action to his detriment 4. injustice can only be avoided by enforcement of promise |
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Ks under seal and the consideration requirement in DE?
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existence of a seal precludes challenges to validity on ground of lack of consideration.
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Capacity/Impairment & Ks in DE?
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1. to be binding, Ks must have been entered into by parties with minds of sufficient soundness for the purpose --> must be capable of comprehending and acting rationally in transactions involved; capable of understanding nature and effect of transaction
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Effect of incapacity in DE?
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agreement is not void but only voidable at the insistence of the mentally incompetent party.
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Age to contract in DE?
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Legal age to contract is 18.
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contracts -- Proving mistake in DE?
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Whether mutual mistake or unilateral mistake, P must show by CLEAR AND CONVINCING EVIDENCE that parties came to a specific prior understanding that differed materially from written agreement.
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Rescinding agreement based on unilateral mistake in DE?
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1. if enforcement would be unconscionable
2. if mistake relates to the substance of the consideration 3.if mistake occurred regardless of exercise of ordinary care, and 4. it is possible to place other party in status quo. |
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Elements of mutual mistake under DE law?
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P must allege:
1. terms of oral agreement between the parties 2. execution of written agreement that was intended, but failed, to incorporate these terms 3. parties' mutual, but mistaken, belief that the writing reflected their true agreement, and 4. the precise mistake |
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What constitutes fraud under DE law?
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1. misrepresentation
2. concealment of a material fact |
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Elements of a fraud claim associated with representations under DE law?
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P must allege:
1. D made a false representation 2. with knowledge or belief that representation was false or with reckless indifference to truth 3. with an intent to induce P to act or refrain from acting 4. P relied on representation 5. damage to P as a result of reliance |
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Effect of fraud on K?
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Recission
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Elements of misrepresentation in DE?
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NOTE --> misrep may be fraudulent OR innocent
P must show: 1. there was a misrep 2. misrep was fraudulent OR material 3. misrep induced recipient to enter in K, and 4. recipient's reliance on misrep was reasonable. |
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When is a failure to disclose actionable in DE?
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1. If contracting parties had a pre-existing fiduciary relationship
2. one party made prior statements that would be incomplete or misleading in absence of disclosing the additional info. |
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contracts -- Elements of duress/coercion in DE?
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conduct of coercing party must be:
1. a wrongful act 2. which overcomes the will of the aggrieved party 3. who has no adequate legal remedy to protect himself. NOTE --> Coerced party can ratify K in spite of the coercion/duress |
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contracts -- Elements of undue influence in DE?
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1. person who is subject to influence
2. opportunity to exert undue influence 3. disposition to exert such influence 4. a result indicating presence of undue influence NOTE --> If there is a confidential or fiduciary relationship, there is a presumption against the validity of the transaction. |
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Unconscionability in DE?
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2 elements:
1. absence of meaningful choice (procedural) 2. terms which are unreasonably favorable (substantive) NOTE --> DE courts very reluctant to apply unconscionability doctrine. |
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DE on Ks violating public policy?
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K is unenforceable. NOTE --> Cts will enforce lawful portion of K (if any) and refuse recognition to the unlawful portion.
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Requirements for a valid liquidated damages provision in DE?
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1. damages difficult to ascertain at time of contracting
2. amount is either (i) a reasonable estimate or (ii) reasonably proportionate to damages actually caused by the breach. |
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When does SOL begin to run in DE?
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Upon claimant's discovery of facts constituting the basis or cause of the action OR existence of facts sufficient to put a person of ordinary intelligence and prudence on inquiry.
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SOL for suits in equity in DE?
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No SOL defense in equity. Laches Doctrine.--> 3 elements to laches defense:
1. P's knowledge that she has a basis for legal action 2. P's unreasonable delay in bringing a lawsuit 3. identifiable prejudice suffered by D as a result of P's unreasonable delay. |
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What Ks are subject to SOF in DE?
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1. any agreement upon consideration of marriage
2. K for sale of land 3. any agreement not to be performed within one year 4. any agreement in which a person agrees to answer for the debt, default, or miscarriage of another 5. Ks for sale of goods of $500 or more 6. K for lending of $100K or more |
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When will multiple writing satisfy SOF in DE?
What are requirements of DE's SOF? |
If they:
1. reasonably identify the subject matter of the K 2. indicate that a K has been made between the parties, and 3. state with reasonable certainty the essential terms of the unperformed promises in the K. |
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General exceptions to SOF in DE?
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1. D raising SOF defense engaged in fraudulent conduct
2. part performance 3. D has admitted the K 4. parties are engaged in boundary dispute and the rule of practical location is applicable 5. parties are engaged in boundary dispute and the doctrine of acquiescence is applicable |
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Doctrine of practical location in DE
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Provides that adjoining landowners may set boundaries by oral agreement.
Elements: 1. boundary is not well-defined or is doubtful 2. designation of a rational boundary 3. immediate taking of possession in accordance with the boundary so established |
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contracts -- SOF exception: Doctrine of acquiescence in DE
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Allows adjoining landowners to establish a boundary line not complying with the original true line by one owner laying out the boundary line and the other not disputing it FOR 20 YEARS.
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contracts -- Plain Meaning Rule & Ambiguity in DE
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When language of a K is clear and unequivocal, a party will be bound by its plain meaning.
A K is ambiguous only when the provisions in controversy are reasonably or fairly susceptible of different interpretations. |
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contracts -- Contra proferentem principle
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Requires ambiguous language to be construed against the drafter
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Entire Ks v. Divisible Ks in DE?
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Entire K -- single assent to a whole transaction involving several things or several kinds of property; consideration is entire and cannot be made severable.
NOTE --> an entire K cannot be enforced in part. it stands or falls entirely. Divisible -- A distinguishing, but not dispositive, charateristic --> payment in installments. |
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Implied covenant of good faith and fair dealing in DE Ks?
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Present in every K, BUT provides LIMITED protection.
It prohibits arbitrary or unreasonable ocnduct which prevents the other party from receiving the fruits of the bargain. To state claim, must allege: 1. specific implied contractual obligation 2. breach of that obligation 3. resulting damage |
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Damages in a PE action under DE law?
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Recovery can, but need not be, limitedto damages which compensate the part based on his or her reliance interest.
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Punitive damages in DE contract actions?
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Generally not recoverable in a pure breach of K action.
If they are awarded, need will, malicious, and/or deceitful action |
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Specific performance in DE?
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Party seeking SP must establish by CLEAR AND CONVINCING EVIDENCE:
1. a valid enforceable agreement exists 2. party seeking SP was ready, willing, and able to perform, and 3. a balancing of the equities favors an order of SP. |
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contracts -- Factors important in determining completeness of integration of a writing in DE?
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1. length of the agreement
2. detail with which terms are set forth, and 3. merger clauses |
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What types of evidence are not excluded by PER in DE?
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1. subsequent negotiations
2. evidence offered to show there was no agreement or that agreement was otherwise invalid 3. evidence offered to interpret the language of the writing evidence to establish grounds for granting or denying rescission, reformation, SP, or other remedy |
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Equity, forfeiture, convenants, and conditions in DE
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b/c equity does not favor forfeitures, it will whenever possible construe an ambiguous provision of a K as a covenant rather than a condition.
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Restrictive covenants in DE
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Strictly construed, but upheld if reasonable
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Covenants not to compete in DE
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1. Must be reasonable in scope, both in duration and geographic scope, and
2. must advance a legitimate economic interest of the party enforcing the covenant. NOTE --> CNTC subject to greater scrutiny when a part of employment Ks as opposed to sale of business Ks. |
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When is a party a 3rd party beneficiary under DE law?
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3 elements -- Requires:
1. intent between contracting parties to benefit a 3rd party 2. intent that the benefit serve as a gift or in satisfaction of a preexisting obligation to the 3rd party, and 3. showing that benefiting the 3rd party was a material aspect to the parties entering into the K. |
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Elements of a tortious interference with contractual relations claim in DE
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1. a valid K
2. about which Ds have knowledge 3. an intentional act by Ds that is a significant factor in causing the breach of contract 4. done without justification, and 5. which causes injury |
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contracts/torts -- Elements of a tortious interference with prospective contractual relations claim in DE
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1. a reasonable probability of a business opportunity or prospective contractual relationship
2. intentional interference by a D with that opportunity 3. proximate cause 4. damages |
