Contract Law Case Briefs

Front 1

Lefkowitz v. Great Minneapolis Surplus Store
ISSUE

Back 1

Under what circumstances is an advertisement an offer?

Front 2

Lefkowitz v. Great Minneapolis Surplus Store
RULE AND HOLDING

Back 2

General rule: ads = invitations to contract

but: when they involve transaction in goods and it invites particular action, is clear, definite, explicit + leaves nothing to negotiation = offer
performance was promised in positive terms in return for something requested

Front 3

Schnell v. Nell
ISSUE

Back 3

Can a nominal sum of money or prior acts of love and affection act as legal consideration sufficient to create an enforceable contract?

Front 4

Schnell v. Nell
RULE AND HOLDING

Back 4

The consideration of one cent = not sufficient
inadequacy of consideration will not vitiate an agreement, does not apply to a mere unequal exchange of money

no legal obligation to honor wife's bequeast

a moral consideration only will not support a contract

neither will past and peppercorn consideration

Front 5

Hamer v. Sidway

ISSUE

Back 5

Is forbearance from permissible legal conduct sufficient consideration to create a valid and enforceable contract?

Front 6

Hamer v. Sidway
RULE AND HOLDING

Back 6

mere abstention from permissible legal conduct - sufficient consideration
consideration can be: some right, interest, profit, benefit to one OR some forbearance, detriment, loss, or responisibilty given, suffered, or undertaken by the other
immaterial whether it is of substantial value to anyone
refraining from something one is entitled to is sufficient detriment

Front 7

Dyer v. National By-Products, Inc.
ISSUE

Back 7

Can forbearance from asserting an unfounded legal claim act as valuable consideration to create an enforceable contract?

Front 8

Dyer v. National By-Products, Inc.
RULE AND HOLDING

Back 8

forbearance from asserting an unfounded legal calim - consideration if asserted in good faith!
law favours settlement without resorting to court action, would be defeated if must litigate to know if unfounded or not

forbearance is sufficient if there is any reasonable ground for the claimant's belieg that it is just to try to enforce his claim

Front 9

Wood v. Lucy, Lady Duff-Gordon

ISSUE

Back 9

1) May a promise to use reasonable efforts be implied from the circumstances of a contract?

2) Can such a promise be considered valuable consideration?

3) Can the duty of good faith compensate for vagueness in a K to avoid invalidation of a K clearly intended?

Front 10

Wood v. Lucy, Lady Duff-Gordon

RULE AND HOLDING

Back 10

1-3: yes; K may lack an explicit promise to further its goals

D's sole compensation was split of the profits, there would be no efficacy unless there was an implied promise

it is clear from the terms and recitals that both parties inteded to do what was reasonably necessary to make it a success so that there would be profits to split

P's obligation to render monthly accounts demonstrates that he had some obligation

Front 11

Pacific Gas and Electric Co. v. G. W. Thomas Drayage & Rigging Co.
ISSUE

Back 11

Is extrinsic evidence admissible to aid in the interpretation of an unambiguous contract term?

Front 12

Pacific Gas and Electric Co. v. G. W. Thomas Drayage & Rigging Co.
RULE AND HOLDING

Back 12

test of admissibility of extrinsic evidence to explain the meaning of a written instrument is to determine whether the offered evidence is relevant to prove a meaning to which the language of the K is reasonably susceptible

it may not add to, detract from, or vary the terms

but it may be used to interpret
must be reasonably susceptible of the meaning

Front 13

W.W.W. Associates, Inc. v. Giancontieri

ISSUE

Back 13

Can an unambiguous contract clause be read in light of extrinsic evidence?

Front 14

W.W.W. Associates, Inc. v. Giancontieri
RULE AND HOLDING

Back 14

Extrinsic evidence as to what the parties to a contract intended but did not state or misstated is generally inadmissible to add to or vary the terms of an agreement
if there is no ambiguity then averments concerning the purpose cannot be considered
extrinsic evidence cannot be introduced to create an ambiguity

Front 15

Frigaliment Importing Co. v. B.N.S. International Sales Corp.
ISSUE

Back 15

1) Does a party who seeks to interpret a contract's ordinary terms in a narrower sense have the burden of proof?

2) Is parol evidence admissible to show the meaning of an ambiguous term and its usage in a contract?

Front 16

Frigaliment Importing Co. v. B.N.S. International Sales Corp.
RULE AND HOLDING

Back 16

A party who seeks to interpret a contract's ordinary terms in a narrower sense than is used in everyday trade has the burden of proof to establish that meaning
parole evidence is admissible: the making of a K does not depend on the agreement of two minds in one intention, but on the agreement of two sets of external signs: not them having meant the same thing, but having said the same thing - here p. e. is admissible

Front 17

Hawkins v. McGee
ISSUE

Back 17

How are damages calculated in a case of breach of contract?

Front 18

Hawkins v. McGee
RULE AND HOLDING

Back 18

Expectation damages to put the P in the position he would have been in if the contract had been performed
no damages for pain and suffering as he would still have endured them had the procedure been successful

entitled to the difference between what he sought - a perfect hand, and what he got - a hairy hand

Front 19

Neri v. Retail Marine Corp.
ISSUE

Back 19

Can a volume retail seller of standard priced goods recover lost profits when a buyer defaults on a sales contract?

Front 20

Neri v. Retail Marine Corp.

RULE AND HOLDING

Back 20

Yes, may recover lost profits, as he would have sold two boats, thus made the profit of two sales and not just one

Front 21

Securtiy Stove & MFG. Co. v. American Ry. Express Co.
ISSUE

Back 21

What kind of damages is an aggrieved party entitled to when damages from lost profits are impossible to calculate?

Front 22

Security Stove & MFG. Co. v. American Ry. Express Co.
RULE AND HOLDING

Back 22

may be entitled to recover reliance expenditures
carrier had notice of peculiar circumstances and knew that delay in delivery would result in unusual losses by the shipper (Hadley Rule)
P is entitled to recover expenses to which it had been put in order to secure benefits of a contract of which D's conduct deprived it

Front 23

Oliver v. Campbell

ISSUE

Back 23

Can one party to a K recover restitution damages when an apparently disadvantageous contract that was basically fully performed is breached by the other party?

Front 24

Oliver v. Campbell
RULE AND HOLDING

Back 24

Three remedies: recover upon quantum meruit so far as he has performed, keep K alive, treat the repudiation as putting an end to K and sue for profits relized had it not been prevented from performing

HERE: P's representation was effectively over when fired; above remedies are not applicable

P can only recover full K price and no more, restitution is not available when fully performed

Front 25

Hadley v. Baxendale

ISSUE

Back 25

What is the amount of damages to which an injured party is entitled for breach of K; are defendants liable to P's damages suffered due to lost profits?

Front 26

Hadley v. Baxendale
RULE AND HOLDING

Back 26

non-breaching party is entitled to damages arising naturally from the breach itself and those that are in reasonable contemplation of both parties at time of the making of the K

Any special circumstances must be communicated at the time the K was made, so that then any breach would include also those damages that would flow naturally from special circumstances of the K

Front 27

McCallister v. Patton
ISSUE

Back 27

Under what circumstances is the remedy of specific performance applicable?

Front 28

McCallister v. Patton

RULE AND HOLDING

Back 28

specific performance may be applied to personal property if it has peculiar, unique, or sentimental value that is not compensable via money damages

the car had no special/peculiar qualities not commonly possessed by cars

inconvenience of not being able to obtain one is not sufficient to warrant application of specific performance

Front 29

White v. Benkowski

ISSUE

Back 29

1) May a court reduce a jury award for compensatory damages in the belief that such damages were not adequately proven?

2) Are punitive damages available in actions for breach of contract?

Front 30

White v. Benkowski
RULE AND HOLDING

Back 30

Compensatory damages need not be proven with precision, evidence of damages is reviewed in the light most favorable to p

punitive damages are not available unless breach was accompanied by fraudulent conduct or another tort (reckless and intentional disregard of K)

Front 31

City of Rye v. Public Serv. Mut. Ins. Co
ISSUE

Back 31

Under what circumstances will a liquidated damages clause be enforceable?

Front 32

City of Rye v. Public Serv. Mut. Ins. Co.
RULE AND HOLDING

Back 32

enforceable so long as amount is a reasonable measure of the anticipated probable harm
most serious disappointments suffered by P were not pecuniary in nature and could nto be measure in monetary damages

nothing shows that the sum per day or the aggregate amount of the bond bore any reasonable relationship to the pecuniary harm likely to be suffered or in fact suffered -> did not reflect a reasonable estimate -> penalty clause