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158 Cards in this Set
- Front
- Back
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WHAT ARE THREE ELEMENTS OF A VALID CONTRACT? |
Offer
Acceptance Consideration |
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NAME 5 MAIN TYPES OF CONTRACTS
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BUEIQ -
Bilateral Unilateral Implied In Fact Express Quasi |
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IMPLIED IN FACT CONTRACTS
(DEFINITION) |
A contract formed by manifestation of assent or conduct.
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VOID CONTRACT
(DEFENSES) |
This type of contract was never valid
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VOIDABLE CONTRACTS
(DEFENSES) |
This is a valid and binding contract but may be voided by either party.
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NAME EXAMPLES OF LEGAL GROUNDS OF A VOIDABLE CONTRACT
(DEFENSES) |
LNMMM
Lack of capacity or free will Non-Disclosure of material facts Misrepresentation Mutual Mistake Material breach of the terms |
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UNENFORCEABLE CONTRACT
(DEFENSES) |
This is an otherwise valid agreement, but may not be enforced due to other defenses such as Statute of Frauds and Statute of limitations
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NAME EXCEPTION TO LACK OF CAPACITY CONTRACT (DEFENSES)
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Necessities - A person without capacity to contract is legally obligated to pay for food, shelter, clothing and medical care
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MISREPRESENTATION
(DEFENSES) |
An voidable agreement. A false assertion or active concealment of a fact that induces a person to enter in to a contract.
REMEDY: Contracts - recission or reformation Torts - Money damages or status quo ante |
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MUTUAL MISTAKE - WHAT MAKES IT VOIDABLE?
(DEFENSES) |
When at the time a contract is made, both parties made a mistake and it is voidable if
- The mistake was a basic assumption on which the contract was made - It pertains to a material fact - The person seeking to void the contract must not bear the risk of the mistake |
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UNILATERAL MISTAKE - WHAT MAKES IT VOIDABLE
(DEFENSES) |
Generally unilateral contracts are irrevocable. However it may be voidable IF
- The mistake was a basic assumption on which the contract was made - It pertains to a material fact - The person seeking to void the contract must not bear the risk of the mistake - It would be unconscionable to enforce - The non mistaken party knew or had reason to know |
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UNDUE INFLUENCE
(DEFINITION) |
A defense to validity of contract where an act of persuasion overcomes the judgment and free will of another. It normally results from persons with a confidential relationship with the alleged victim through flattery, trickery or deception
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NAME 4 ELEMENTS OF UNDUE INFLUENCE
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SUMS-
Susceptibility Undue Influence Motive Suspicious behavior |
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DURESS
(DEFINITION) |
An agreement that is executed by the intentional use of force or threat of force to coerce another in to a grossly unfair transaction. (Blackmail, extortion)
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MISTAKE v. MISUNDERSTANDING
(DEFINITION) |
MISTAKE - a belief that is not in accord with the facts at the time a contract is made
(valid but can the mistaken party can avoid enforcement) MISUNDERSTANDING - When parties agree to a term, but each party applies a different meaning to the term. (is it valid? if so what are the terms) |
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PRIVITY OF CONTRACT
(DEFINITION) |
A legal doctrine describing individuals who have made a legally enforceable agreement
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MANIFESTATION OF ASSENT MUST SHOW THAT...
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There must be manifestation of assent between the parties to show that they are mutually bound to the same transaction.
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ESSENTIAL TERMS OF AN OFFER (COMMON LAW)
(OFFER) |
QTIPS
Quantity Time Identity Price Subject Matter |
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ESSENTIAL TERMS OF AN OFFER (UCC)
(OFFER) |
UCC Article 2 supplies terms where the parties have left gaps in their agreement to make an entire bargain. Subject matter is required
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UCC GAP FILLERS
OPEN PRICE TERM DELIVERY POINT NOT STATED DELIVERY TIME NOT STATED PAYMENT TIME NOT STATED |
Price - A reasonable price set to some agreed market or other standard
DP - Place of business or residence DT - A reasonable time PT - Upon delivery |
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VAGUE AND AMBIGUOUS TERMS
(OFFER) |
Some agreements cannot be fully enforced because of vague or ambiguous terms in the offer.
It still may be enforced due to - Prior dealings - Part performance or - Acceptance |
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COMMUNICATION OF AN OFFER
(OFFER) |
An offer must be communicated to the offeree to be able to have the power of acceptance
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NAME 4 WAYS OF TERMINATING AN OFFER
(OFFER) |
LAWD -
Lapse of Time Conduct by offeror Conduct by offeree Death or incapacity |
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MERCHANT'S FIRM OFFER
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This rule states that an offer cannot be revoked for up to 3 months IF
a. Between merchants b. there is an offer to buy or sell goods c. There is a signed writing to keep the offer open |
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NAME 4 SITUATIONS WHICH ARE GENERALLY IRREVOCABLE
(OFFER) |
Option Contract
Merchant's Firm offer Detrimental Reliance Start of performance of Unilateral contract |
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ACCEPTANCE (DEFINITION)
(ACCEPTANCE) |
An unequivocal assent to the terms of an offer
(It can only be accepted by a person who is the identified offeree and is generally not assignable) |
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WHO MAKE ACCEPT AN OFFER?
(ACCEPTANCE) |
The power of acceptance resides with the identified offeree, and can generally not be assigned (unless its an option contract and the agreement does not expressly does not allow it)
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REVOCABLE OFFERS - WHEN ARE THEY REVOKABLE?
(ACCEPTANCE) |
(DIRR)
They generally stay open unless Rejection or Counter offer Revocation Death Illegality |
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IRREVOCABLE OFFERS - HOW CAN THEY BE TERMINATED?
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Offeree's power and right to accept can only be terminated by (LIDN)
Lapse of time Illegality Death Non occurrence of a necessary condition |
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SILENCE AS A MODE OF ACCEPTANCE
(ACCEPTANCE) |
Silence is NOT generally a valid form of acceptance UNLESS
a. Previous conduct indicate silence is a suitable mode of acceptance b. An implied in fact contract has been formed (such as use of anothers property for example) |
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COMMUNICATION OF ACCEPTANCE
(FORMATION) |
A contract is formed when acceptance is actually communicated to the offeror
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THE MAILBOX RULE (DEFINITION)
(FORMATION) |
When parties are not dealing face to face, then acceptance is valid upon dispatch
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THE MAILBOX RULE (EXCEPTIONS)
(FORMATION) |
The Mailbox rule does NOT apply IF
a. the offer stipulates acceptance effective upon receipt b. there is an option contract (acceptance on receipt) c. If rejection is RECEIVED first then that is valid (even though acceptance arrives after |
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POST REJECTION ACCEPTANCE
(MAILX BOX RULE) |
Rejection is sent first, then acceptance
Mailbox rule does NOT apply Whatever is received by offeror first applies |
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DESCRIBE POST ACCEPTANCE REJECTION UNDER THE MAILBOX RULE?
EXCEPTION? |
Acceptance is sent first, then rejection
Rejection is received first Mailbox rule applies and contract is formed (exception - if offeror changes position based on rejection - offered cannot enforce contract) |
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COUNTER OFFER (COMMON LAW)
(FORMATION) |
Under the MIRROR IMAGE RULE, if the acceptance contains different or additional terms it is deemed a rejection and counter offer.
(conditional acceptance "only if" etc. is also a rejection/counter offer |
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WHEN THERE IS AN IMPROPER RESPONSE TO AN OFFER CAN LATER CONDUCT IMPLY A CONTRACT?
-COMMON LAW - UCC (FORMATION) |
COMMON LAW - If conduct as if there is a contract (implied in fact)
UCC - If conduct as if there is a contract, it is treated as a NEW contract and the terms consist of the writings and any UCC Gap fillers |
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WHEN CAN AN OFFEREE ACCEPT BY FULL PERFORMANCE?
(FORMATION) |
a. If there is an oral offer
b. the offeree does not communicate with words but their response is full performance |
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ACCEPTANCE OF A REWARD OFFER
(FORMATION) |
A reward offer can generally be accepted only by the first person who meets all conditions of the offer.
(doing the act without knowledge of the offer is NOT acceptance because only effective upon receipt) |
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WHAT ARE THE TWO ELEMENTS OF CONSIDERATION
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Bargained for exchange - both parties give something
Legal Value - a benefit to the the promisor and a detriment to the promisee |
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WHAT DOES ACCEPTANCE BE UNDER COMMON LAW?
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The mirror image of the offer. Any additional or different terms would result in a rejection and counter offer.
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WHEN DOES THE LAST EXPRESSION CONTROL THE FORMATION OF A CONTRACT?
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The Last shot rule may imply there is a contract by performance
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UNDER UCC 2-207 WHEN DOES ADDITIONAL TERMS BECOME PART OF THE CONTRACT? Unless?
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a. between merchants (if non merchants doesn't apply)
unless the offer limits acceptance the offeror objects within a reasonable time it materially changes the contract |
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WHAT IS CONDITIONAL ACCEPTANCE CONSIDERED?
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A rejection and a counter offer
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UNDER UCC 2-207 WHAT IS ALSO SUFFICIENT TO ESTABLISH A CONTRACT FOR SALE?
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If conduct by both parties implies that an agreement has been formed.
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WHAT IS THE MAJORITY RULE AS FAR AS ACCEPTANCE WITH DIFFERENT TERMS UNDER UCC 2-207?
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Majority rule is that different terms get knocked out (knock-out rule) and one applies UCC gap fillers, custom and usage and course of dealing or performance
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DESCRIBE THE MANNER OF ACCEPTANCE REQUIRED
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By the manner required by the offer, and if not stated, then any reasonable manner or the same way the offer was sent
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HOW DOES CROSSING OFFERS APPLY TO MUTUAL ASSENT?
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Crossing offers that contain identical information do not result in mutual assent and NO contract is formed
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IS PAST CONSIDERATION CONSIDERATION?
WHAT ARE THE EXCEPTIONS? |
NO
When you do something a someones request and that person afterwards promises something for doing that requested act, that promise is enforceable |
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IS MORAL CONSIDERATION CONSIDERATION?
WHAT ARE THE EXCEPTIONS? |
NO usually falls under past consideration
Exceptions -Debts are barred by a technical defense such as statute of limitations, frauds, incapacity and bankruptcy will be enforceable if reaffirmance is in writing |
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WHERE DOES THE PRE EXISTING DUTY RULE APPLY AND IS IT CONSIDERATION?
Exceptions? |
Common law
A promise to perform an existing legal duty is NOT sufficient consideration Exceptions are when pre-existing duty is owed to third party |
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WHAT IS THE MAJORITY RULE AS FAR AS DETRIMENT TO THE PROMISEE?
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Doing something/or refraining from doing something that someone has a legal right to do
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DESCRIBE BINDING OBLIGATIONS OF BOTH PARTIES
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Both parties need to be bound to the terms of the agreement
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WHAT DOES PROMISSORY ESTOPPEL REQUIRE?
WHAT IS ENFORCEMENT LIMITED TO ? |
A reasonable, foreseeable, substantial and detrimental reliance.
The amount that would prevent an unjust result |
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DESCRIBE WHEN PROMISSORY ESTOPPEL CAN BE INSTITUTED
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When injustice can only be avoided by the enforcement of the promise
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WHAT ARE THE THREE DEFENSES TO FORMATION OF CONTRACTS?
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Void - was never a legally binding agreement
Voidable - May elect to avoid or ratify Unenforceable - otherwise valid but has some defenses extraneous to formation |
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NAME THE 6 AGREEMENTS UNDER THE STATUTE OF FRAUDS THAT MUST BE IN WRITING
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MY LEGS
Marriage One Year Rule Land Estoppel Exception Guaranty Contracts Sale of goods for more than $500 |
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ARE THERE ANY EXCEPTIONS TO THE STATUTE OF FRAUDS AS FAR AS MARRIAGE?
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NO
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DESCRIBE WHEN TIMING STARTS UNDER THE ONE YEAR RULE and ARE THERE ANY EXCEPTIONS?
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Timing starts from time of formation until the end of performance
It CAN be taken out of statute of frauds if there is any possibility that performance will be completed within one year. |
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WHAT IS THE MAJORITY RULE AS FAR AS CANCELLATION CLAUSES?
CAN IT THEN BE REMOVED FROM THE STATUTE OF FRAUDS? |
Cancellation clauses produce excusable non performance
and Majority Rule states that excusable non performance does not equal performance NO |
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WHAT DOES INTEREST IN LAND INCLUDE? (3)
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a. sale of land
b. leases or easements for more than one year c. minerals or the like |
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WHAT IS THE EQUAL DIGNITY RULE?
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A principle-agent agreement giving agent authority to execute a contract for an interest in land that MUST be signed by the principal
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HOW CAN SALE OF LAND BE TAKEN OUT OF SOF?
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a. Make payment
b. Move on the land c. Make improvements |
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WHAT IS A CONTRACT FOR THE SALE OF GOODS ENFORCEABLE FOR?
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Only for the quantity of goods admitted and payment has been made and accepted (If specially manufactured goods to the extent produced or procurement of material)
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WHAT DOES A SURETY SAY?
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If he doesn't pay, I will
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WHAT MUST A SURETY BE?
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A collateral promise
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WHAT DOES A GUARANTOR REQUIRE?
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That you go after the principal person. A guarantor applies only once payment has not been made
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HOW CAN SURETY PROMISE BE TAKEN OUT OF SOF?
WHAT IS THE DOCTRINE CALLED? |
It can be taken out of the SOF if the main purpose of the promise was to financially benefit the PROMISOR rather than the debtor
- Main purpose doctrine |
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WHAT IS REQUIRED FOR SOF FOR ENFORCEABILITY?
WHOSE SIGNATURE DOES IT REQUIRE? |
A writing that evidences the existence of a contract
It ONLY requires the signature of the party being charged - the party against whom enforcement is sought |
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WHAT IS THE UCC EXCEPTION TO "Signed by the party to be charged?
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UCC 2-201 - Merchants confirmatory memorandum. Satisfies OSF UNLESS written notice of objection to its contents is given within 10 days after it is received.
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EXPLAIN HOW TO ANALYZE IF SOF APPLIES? (3)
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A. Is it within the SOF?
B. Can it be taken out of SOF? C. Is SOF satisfied |
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WHAT HAPPENS TO A CONTRACT IF ITS SOF AND CAN NOT BE TAKEN OUT NOR SATISFIED?
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It is NOT void or voidable - only UNENFORCEABLE
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INCAPACITY - CONTRACTS WITH MINORS ARE VOIDABLE BY THE MINOR UNLESS...
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The contract is affirmed after reaching age of majority
(It can be expressly or impliedly affirmed (payment) |
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HOW MUCH TIME DO YOU HAVE TO DISAFFIRM A CONTRACT ONCE TURNING 18?
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30 days
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EXPLAIN HOW CONTRACTS WITH MINORS FOR NECESSITIES WORK?
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Contracts with minors for food, clothing, shelter and education - Minors are still responsible
(can file a claim if being overcharged though) |
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WHAT ARE STATUTORY EXCEPTIONS TO CONTRACTS WITH MINORS?
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Insurance
School loans |
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WHAT ARE CONTRACTS WITH (ADJUDICATED) MENTALLY CHALLENGED PERSONS CONSIDERED?
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VOID
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WHAT IF THEY ARE MENTALLY DEFICIENT BUT NOT COURT DETERMINED?
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VOIDABLE
- the mental capacity must be deficient that the person does not understand the nature and the consequences of a contract - or is unable to act in a reasonable manner in relation to the contract |
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WHO MAKES A MENTALLY DEFICIENT CONTRACT VOIDABLE?
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Only at the option of the mentally deficient person
(If they have a lucid moment and affirm it then it is enforceable) |
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WHEN ARE CONTRACTS WITH PEOPLE WHO ARE INTOXICATED VOIDABLE?
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a. If so intoxicated that not understanding the nature of the agreement
b. unable to act in a reasonable manner in relation to the contract or c. The other party knew of the intoxication |
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WHEN IS A CONTRACT WITH AN INTOXICATED PERSON ENFORCEABLE?
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If recovers and affirms the contract (It is voidable only at the option of the intoxicated person and they are still liable for necessities)
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WHICH CONTRACTS ARE ILLUSORY?
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Those under complete control of the promisor
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WHAT IS THE MAJORITY RULE AS FAR AS DETRIMENT TO THE PROMISEE?
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Doing something that someone is not legally obligated to do, or refraining from something that they legally can do
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HOW CAN SALE OF GOODS MORE THAN $500 BE TAKEN OUT OF SOF?
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SPA
1. Specially manufactured goods 2. Part or full performance 3. Admissions under oath and pleadings |
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WHAT IS THE DIFFERENCE BETWEEN A SURETY AND A GUARANTOR
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A surety is not conditional upon someones fault ("If he doesn't pay I will"). A guarantor applies ONLY once there is a lack of payment
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WHAT IS REQUIRED TO SATISFY THE SOF AND MAKE IT ENFORCEABLE?
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A writing that is sufficient evidence of the existence of a contract. It only requires a signature by the party to be charged.
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IF THERE ARE TWO MERCHANTS AND ONE PARTY SENDS A WRITING CONFIRMING THE TRANSACTION AND THE 2nd PARTY KNOWS ITS CONTENTS AND DOESNT OBJECT… IS THE CONTRACT BINDING?
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YES
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CONTRACTS WITH MINORS ARE VOIDABLE. WHAT ARE THE EXCEPTIONS?
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1. If the contract is expressly or impliedly affirmed within a reasonable time after turning 18.
2. If the contract is not DISAFFIRMED within 30 days of turning 18 |
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WHAT DO YOU HAVE TO CHECK TO TEST IF MISREPRESENTATION APPLIES?
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1. Check if fact or opinion
2. Future events vs future intentions (did they intend to carry it out, but something came up) |
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WHAT IS THE GENERAL RULE AS FAR AS DISCLOSURE?
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There is generally no duty to disclose no liability for non disclosure
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WHAT ARE THE EXCEPTIONS TO NON DISCLOSURE RULE?
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1. Half Truths - fragmentary information
2. Believed it was truthful when made 3. Believed it was true when made but now its false 4. Active concealment |
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MISREPRESENTATION/FRAUD - WHAT DO EACH INCLUDE?
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Misrepresentation - innocent and negligent misrepresentation
Fraud - Intentional misrepresentation requires scienter or reckless disregard |
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WHAT DO INNOCENT AND NEGLIGENT MISREPRESENTATION REQUIRE?
WHAT DO INTENTIONAL MISREP/. (FRAUD) REQUIRE? |
Reasonable and actual reliance
Only actual reliance |
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WHEN IS A CONTRACT VOID AND VOIDABLE DUE TO FRAUD?
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VOID - Fraud in the "factum"
VOIDABLE - Fraud in inducement |
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PHYSICAL DURESS
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When a party enters in to a contract or modifies an existing contract solely based on physical force or threats - VOID
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ECONOMIC DURESS
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When a party enters into a contract or modifies an existing contract solely based on wrongful threats
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NAME 4 WAYS OF ECONOMIC DURESS
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1. Threat of future crime or tort
2. Threat of criminal prosecution 3. Bad faith use of civil process 4. threat of wrongful breach of existing contract |
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NAME EXAMPLES OF UNDUE INFLUENCE
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SUMS
1. Susceptible victim 2. UNDUE INFLUENCE 2. Motive 3. Suspicious behavior |
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WHAT IS UNILATERAL MISTAKE AND IS THERE ANY DEFENSE?
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When one party is mistaken as to a material fact |
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WHAT IS AMBIGUITY AND WHAT TWO THINGS CAN IT BE ASSOCIATED TO?
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When a term is open to various interpretations
Either the term is associated with NO ONE thing or MORE THAN ONE THING |
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NAME TWO TYPES OF AMBIGUITY
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Patent - ambiguous on its face and Latent (hidden)
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NAME 3 ELEMENTS OF LATENT AMBIGUITY
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a. only becomes ambiguous after further facts presented
b. neither or both aware of ambiguity - no contract unless same meaning applied c. if one party is aware of ambiguity - contract, the meaning is that of the unaware party |
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AMBIGUOUS TERMS WITH MULTIPLE MEANINGS
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If the recipient is only aware of one meaning, and the author is aware that the recipient is only aware of the meaning, then that is the meaning that is fixed for the term
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WHAT MAY COURTS DO WHEN THERE ARE SCHRIVENORS ERRORS?
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May reform the contract when a mistake does not reflect the actual agreement of the parties
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WHAT DOES SPECIFIC PERFORMANCE REQUIRE?
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SPECIFIC PERFORMANCE OF CONTRACT
a. inadequacy of money damages b. definite and certain terms c. feasibility of the court to enforce, and d. mutuality of remedies - SUBJECT MATTER MUST BE UNIQUE - EQUITABLE DEFENSE APPLY |
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WHAT ARE POTENTIALLY UNIQUE SUBJECT MATTERS TO ENFORCE AN AGREEMENT THROUGH SPECIFIC PERFORMANCE?
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Land
Services |
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REQUIREMENT CONTRACTS
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Requirement contracts are agreements by one party to supply all that is required by the other party
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OUTPUT CONTRACTS
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Output contracts are agreements by one party to buy all that the other party produces
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LAST SHOT RULE
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Under common law when parties exchange rejections and counter offers the last expression before performance controls and creates an implied contract
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KNOCK OUT RULE
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The majority rule when different terms are introduced to a contract, the different terms get "knocked-out" and one applies UCC Gap fillers, custom and usage and course of dealing or performance
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MIRROR IMAGE RULE
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Under common law, acceptance must contain the mirror image of the offer. If the acceptance contains different or additional terms it is deemed a rejection and counter offer.
(conditional acceptance "only if" etc. is also a rejection/counter offer). |
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RECISSION
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An equitable remedy. The unmaking of a contract to bring the parties back to where they were before they entered in to a contract.
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DECLARATORY RELIEF
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A judge's determination of the parties rights under a contract or a statute. It is an early resolution of legal rights which will resolve some or all of the issues.
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ACCOUNT OF PROFITS
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An equitable remedy. It is an action taken against a defendant to recover the profits taken as a result of the breach of duty, in order to prevent unjust enrichment.
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SPECIFIC PERFORMANCE
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An equitable remedy. If there has been a reasonable, foreseeable, detrimental reliance on an oral promise, or if seller accepts payment or buyer accepts delivery of goods, or if there is full performance of the contract a court may order specific performance to enforce the contract.
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REFORMATION
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An equitable remedy. A court can order a change a written document to so that it conforms to the original Intent in order to correct a written agreement of the parties.
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BREACH OF CONTRACT
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When a party fails to perform their duties under the contract.
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QUASI CONTRACTS
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Not really contracts, but describe situations where there may be an unjust enrichment. The measure of the value is the benefit conferred.
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LEGAL VALUE
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Legally enforceable rights and obligations. It determines whether there is a benefit to the promisor or detriment to the promisee.One of the two elements of consideration.
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LIQUIDATION
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The collection of assets belonging to a debtor to be applied to the discharge of his or her outstanding debts.
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COMPENSATORY DAMAGES
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Actual damages paid to compensate the non breaching party for loss, injury or harm.
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NOMINAL DAMAGES
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Minimal money damages awarded to an individual in an action where the person has not suffered any substantial injury or loss for which he or she must be compensated.
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PUNITIVE DAMAGES
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Damages where compensatory damages are inadequate which seek to reform or deter behavior.
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SPECIAL DAMAGES
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Compensates the non-breaching party for quantifiable monetary or economic losses, including extra costs for repair, replacement of damaged property or lost earnings.
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RELIANCE DAMAGES
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The measure of compensation given to a person who suffered economic harm for acting in reliance. Damages are measured by the plaintiffs loss.
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STATUTORY DAMAGES
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Pre-established damages for cases where calculating a correct sum is deemed difficult (often copyright or trademark cases). (will not be on the bar).
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RESTITUTION
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A court order of restitution is a law of gains based recovery which orders the defendant to give up his gains to the claimant.
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PREDOMINANCE TEST
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An analysis of which rule of law is predominant whether common law or UCC. In a transaction involving both goods and services, U.C.C. Article 2 applies if the transaction is predominantly for the sale of goods, but does not apply if the transaction is predominantly for the provision of services
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PAROLE EVIDENCE RULE
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This rule of law prevents a party from contradicting or adding new terms by seeking admission of extrinsic evidence (applies only once a final integrated writing of the agreement is completed)
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MAJORITY RULE FOR CONTAINING DEFINITE AND CERTAIN TERMS UNDER THE UCC?
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Offer need only state the subject matter of the contract with definiteness and certainty
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WHAT IS THE MAJORITY RULE IN REGARDS TO DIFFERENT TERMS?
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The different terms get knocked out and one applies Gap fillers, custom and usage and course of dealing or performance
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WHAT DOES UCC 2-206 STATE IS CONSIDERED ACCEPTANCE (SHIPMENT)
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a. By promise to ship
b. by shipment c. shipment of non conforming goods (if no letter of accommodation the shipment of non conforming goods will be an acceptance and a breach) |
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NAME A CONSIDERATION SUBSTITUTE
WHAT DOES IT REQUIRE? |
Detrimental reliance
reasonable, foreseeable and substantial reliance |
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NAME THE DEFENSES TO FORMATION
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SI IM DUUM
S - Statute of Frauds I - Incapacity I - Illegality M - Misrepresentation/Fraud D - Duress U - Unconscionability U - Undue Influence M - Mistake |
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WHAT IS THE EXCEPTION TO "SIGNED BY THE PARTY TO BE CHARGED?"
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Merchants Confirmatory Memorandum
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WHAT MUST NON-COMPETITION CLAUSES BE?
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Reasonable in time and geographic scope
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IF A SUBJECT MATTER IS LEGAL BUT THE USE IS ILLEGAL WHAT HAPPENS?
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If one party is unaware of the illegal activity the contract is voidable at option of innocent party
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WHAT IS SUPERVENING ILLEGALITY?
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If at the time the contract is formed the subject matter or purpose is legal, but subsequently become illegal, obligations of both parties are discharged
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WHEN IS A CONTRACT VOID DUE TO A LICENSING ISSUE?
WHEN IS IT ENFORCEABLE? |
If the purpose of the license is to protect the welfare of the public by insuring minimum competency - contract is void
If the purpose is to generate REVENUE the contract is enforceable |
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WHAT DOES IN PARI DELICTO MEAN?
WHEN MAY THERE BE AN EXCEPTION? |
When both parties are equally culpable - court will not grant any relief
Less culpable party may recover in restitution |
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WHAT DOES IT TAKE FOR A CONTRACT TO BE UNCONSCIONABLE?
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Majority rule states that it requires BOTH
a. Procedural U - Absence of choice b. Substantive U - Unreasonably favoring one party |
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WHEN ARE CONTRACTS AGAINST PUBLIC POLICY?
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When they are considered to be
a. against public good b. injurious to the public c. exculpatory clauses for injury due to consumer goods |
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WHAT ARE 4 REMEDIES FOR UNCONSCIONABLE CONTRACTS?
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a. Court may refuse enforcement
b. Court may eliminate any unconscionable terms (Blue) c. Court can limit the application of any unconscionable terms d. If unconscionable at time was made |
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WHEN DOES MUTUAL MISTAKE OCCUR?
WHO CAN VOID IT? |
When both parties are mistaken as to a material fact
Adversely affected party |
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UNILATERAL MISTAKE
ARE THERE ANY DEFENSES? |
Occurs when only one party is mistaken as to a material fact
no UNLESS a. non mistaken party knew or should have known b. mistake is one of computation or omission |
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WHAT ARE 3 EQUITABLE DEFENSES TO SPECIFIC PERFORMANCE?
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Unclean hands - party seeking spec perf is guilty of wrongdoing
Laches - Delay in bringing the equitable action Sale to BF purchaser - sale to a good faith purchaser without notice of any dispute will cut-off any equitable remedies |
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WHAT ARE THE 6 MAJOR ISSUES TO CONSIDER IN REGARDS TO CONTRACTS
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Applicable Law
Contract Formation Contract Enforceabilty Breach of Contract Plaintiffs remedies 3rd Party Interests |
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WHAT ARE 5 MODES OF ACCEPTANCE
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Promise
Performance Beginning Performance Any manor reasonable Silence |
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WHICH ARE THE EQUITABLE REMEDIES
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When legal remedies are not sufficient to address harm, these equitable remedies are available. (SEARRID)
Specific Performance Estoppels Account of Profits Recission Reformation Injunction Declaratory Relief |
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ARE ADVERTISEMENTS OFFERS?
WHAT ARE THE EXCEPTIONS? |
Advertisements are generally not offers but invitations to deal, offers to negotiate, invitations to receive offers
EXCEPTIONS a. When the person solicits the item b. When the item contains all the material terms of the offer and identifies the offeree. |
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WHAT ARE THE REQUIREMENTS OF A REAL ESTATE CONTRACT?
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It requires a description of the real property with adequate certainty to ID the land and the price.
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WHAT IS ASSIGNMENT AND WHAT IS DELEGATION
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Assignment is a transfer of contractual rights
Delegation is a transfer of contractual duties (delegator still normally accountable) |
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REVOCATION OF OFFER (offered and offeror)
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If the offeror communicates to the offer that the offeror no longer wishes to be bound by the offer, then the offer is terminated.
If the offeree communicates to the offeror that the offeree is not interested in the offer, then the offer is terminated |
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WHAT ARE 3 MAIN WAYS THAT ORIGINAL CONTRACTING PARTIES CAN MODIFY OR TERMINATE THEIR CONTRACT?
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Rescission - Mutual rescission discharges parties
Novation - Contractual parties and a third party agree to discharge one of the original contracting parties and create a new contract with a third party Accord & Satisfaction - A new agreement between the parties to allow new consideration. The satisfaction is the actual performance of the new form of consideration |
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WHAT ARE 3 DEFENSES TO BREACH OF CONTRACT?
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a. Impossibility - (death or illness)
b. Impracticable - extremely more burdensome (installing a pool where there is granite) c. Frustration of purpose - Value is worthless (buyers defense) |
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WHEN IS SILENCE A VALID FORM OF ACCEPTANCE?
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Very rarely considered a valid form of acceptance EXCEPT
a. Previous conduct between the parties b. Silent acceptance of services suggests an implied in fact contract c. Use of anothers property suggests an implied in fact contract exists |
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WHICH TWO SITUATIONS LACK THE BARGAINED FOR EXCHANGE
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GIFTS (no detriment)
PAST OR UNSOLICITED ACTIONS (not bargained for) |
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PROMISSORY ESTOPPEL
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A court may use the doctrine of promissory estoppel to remove the contract from the statute of frauds to prevent promisor from denying a contract.
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