Contracts

Front 1

MIXED Deal Contracts (involving Services and Contracts) are governed by

Back 1

All or Nothing Rule - what is the MORE Important PART

Unless DIVIDING PAYMENT CONTRACTS, UCC governs Sales, Common Law governs rest

Front 2

Unilateral Contracts are:

Bilateral Contracts are:

Back 2

Promise to perform in exchange for PERFORMANCE

Promise to perform in exchange of Counter-promise by Words Or Acts

Front 3

Option Contract is...

Back 3

(1) Promise
(2) To Keep Contract Open
(3) For Consideration

Front 4

OFFER is a

Back 4

manifestation of commitment to enter into a agreement

Front 5

OFFER Exists under UCC Article 2 if

Back 5

Parties intent

Front 6

OFFER exists in COMMON LAW if

Back 6

(1) Price Terms and
(2) Description

Front 7

Buyer can INCREASE terms of Requirement's contracts when:

Back 7

increase is NOT unreasonably disproportionate

Increased AMt / Total Amt of Old Base

Front 8

ADVERTISEMENTS ARE OFFERS WHEN...

Back 8

(1) REWARD Or
(2) Specific to Quantity And EXPRESSLY States WHO can ACCEPT

Front 9

How can you TERMINATE an OFFER?

3 ways

Back 9

(1) LAPSE of TIME (stated in K/reasonable time)

(2) DEATH of Party BEFORE ACCEPTANCE

(3) REVOCATION

Front 10

REVOCATION

Back 10

(1) Statement Or Conduct
(2) By Offeror
(3) Of Unwillingness to Contract
(4) and Offeree is AWARE

Front 11

REVOCATIONS sent by mail are ...

Back 11

Effective when RECEIVED

Front 12

CANNOT REVOKE an Offer in 5 scenarios:

What are they?

Back 12

(1) Acceptance occurred

(2) Irrevocable Offer Made (Option K)

(3) Reasonably Foreseeable Detrimental Reliance

(4) Start of Performance for Unilateral K irrevocable for reasonable time to complete performance

(5) UCC Firm Offer Rule

Front 13

U.C.C. Firm Offer Rule (Irrevocable Offer) is:

Back 13

(1) Offer by Merchant
(2) to buy or Sell Goods
(3) Signed in Writing
(4) promise to keep open for up to 3 months
(5) by it's terms

Front 14

REJECTION of OFFER in 4 Ways

Back 14

(1) COUNTEROFFER

(2) CONDITIONAL ACCEPTANCE

(3) COMMON LAW MIRROR IMAGE RULE (additional terms = counteroffer)

(4) UCC Article 2 Section 2-207: ADDITIONAL TERMS conditional upon acceptance - counteroffer

Front 15

UCC Article 2 section 2-207

(Offers)

Back 15

(1) Offer that Adds New terms
(2) NOT made as condition of acceptance
(3) Are PROPOSALS

IF ADDITIONAL TERM
(1) MAterially changes the Offer Or
(2) Offeror OBJECTS to change
(3) Additional Term is NOT Part of the Contract (drops out)

Front 16

ACCEPTANCE OF an OFFER occurs by 5 ways...

Back 16

(1) CONDUCT for additional terms K = acceptance for counteroffer (common law) acceptance of new contract based solely on conduct (UCC)

(2) FULL PErformance by Offeree

(3) Start of Performance for Bilateral K

(4) Offeree's Promise to Perform

(5) Mailed Acceptance effective when mailed

Front 17

Acceptance by mail does not apply to

Back 17

Option Contract Deadlines

Front 18

4 types of Consideration are:

Back 18

(1) Performance
(2) Forbearance
(3) Promise of Performance
(4) Promise of Forbearance

Front 19

Past Consideration is

Back 19

Something already performed BEFORE K was Made, unenforceable K b/c no consideration

Front 20

CONTRACT MODIFICATION under Common Law requires...

Back 20

New Consideration unless

(1) New addition or change in performance

(2) Unforeseen difficulties so Severe that they Excuse Performance

(3) Third Party Promises to Pay

Front 21

CONTRACT MODIFICATION under UCC requires

Back 21

GOOD Faith

Front 22

3 CONSIDERATION SUBSTITUTES that ENFORCE Ks are:

Back 22

(1) SEALS (in MD ONLY)*

(2) Written Promises to Pay Even Though you have Legal Defenses NOT to Pay (SOL ran)

(3) PRomissory Estoppel - reasonable foreseeable detrimental reliance and enforcement to avoid injustice

Front 23

LACK of CAPACITY can still enforce K by ____

Back 23

Ratification - capacity gained and D keeps benefits of K without objection

Front 24

Statute of FRAUDS (SoF) applies to

Back 24

Oral Agreements ONLY

Front 25

Promises that FALL WITHIN STATUTE OF FRAUDS include (6 promises) :

Back 25

(1) Promise by Executor to Pay Estate Debts of Decedent out of their Own Funds

(2) Promise Made in Consideration of Marriage

(3) Promises to Answer a Debt for Another***

(4) Promise that Creates an Interest in LAND

(5) Promise of Sale of Goods $500 or More

(6) Promise by It's Terms CANNOT be DONE WITHIN ONE YEAR (service K)

Front 26

Under SoF, the Promise to Answer a Debt for Another DOES NOT fall WITHIN SoF IF

Back 26

Main Purpose Exception applies: Person Guaranteeing debt has main purpose to guarantee because it gives them pecuniary benefit or secures them an advantage

Front 27

Satisfying the SoF - Proving that there was a contract can be done by:

Back 27

(1) Full Performance of the Party

(2) Part Performance for:
a. Specially Manufactured Goods if there has been Substantial Beginning
b. Ordinary Goods satisfied to Part actually performed
c. Buyers payment satisfied to extent buyer paid

(3) Writing
a. Service K contain all material terms and signed by party asserting defense
b. UCC K: contains quantity terms and signed by party asserting Sof Defense
c. UCC K where both parties are Merchants: writing has quantity term and party claiming no K fails to respond to writing within 10 days of receipt

(4) Judicial Admissions - Under Oath Pleadings/Testimony Satisfies SoF

Front 28

Broad Reasons Not to Enforce Contact include 7

Back 28

(1) Illegal Subject Matter

(2) Illegal Purpose

(3) Public Purpose (covenants not enforced)

(4) Misrepresentation -
a. Fraud - even if honest belief, buyer can RESCIND
b. Duress

(5) Unconscionability

(6) Ambiguous Term - open to two interpretations

(7) Mistake of FACT

Front 29

Mistake of Fact Is an Unenforceable Contract if:

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(1) Both parties are Mistaken as to a assumption of Fact

(2) fact Materially Affects agreed Exchange and

(3) Party trying to get out of the K does Not Bear the Risk of K

Front 30

Unilateral Mistake of Fact is an Unenforceable Contract if:

Back 30

Nonmistaken Party KNEW or HAD REASON to KNOW of the mistake

(obvious mistakes)

Front 31

Parol Evidence Rule: Courts can admit evidence of earlier agreements (oral) in 4 "Limited purposes"

Back 31

(1) Contradicting Written Deal: for the limited purpose of showing there was a mistake in integration

(2) Rescinding Deal: determining defenses to enforcement i.e. Misrepresentation

(3) Explaining Term in Deal: introduce evidence based on custom/usage, or course of performance to explain/supplement a contract term

(4) Adding to Deal: Written agreement was only partly integrated or added terms would ordinarily be in separate agreements

Front 32

Delivery Obligations of Seller in a Shipment Contract is:

Back 32

(1) Get the Goods to Common Carrier
(2) Make Reasonable arrangements for delivery and
(3) Notify the Buyer

Front 33

Delivery Obligations of a Seller in a DESTINATION Contract:

Back 33

Risk of Loss held by Seller UNTIL goods ARRIVE to Destination (to Buyer)

Front 34

F.O.B. (then Seller's City)

F.O.B. Buyer's City Or Any Other City

Back 34

Shipment Contract


Destination Contract

Front 35

Risk of Loss if
(1) Not controlled by an Agreement and
(2) Neither PArty has Breached

Back 35

Risk of Loss on Seller UNTIL Delivery obligation is Complete

If No delivery obligation by Common carrier -
If Seller is MERCHANT:
- Risk of Loss shifts to buyer on "receipt"

Seller NOT a MERCHANT:
- Risk of Loss on Buyer at "tender"

Front 36

RECOVERY of NON-BREACHING PARTY for Risk of Loss Case

Back 36

(1) Cancel K and Recover Incidental Damages (cost of replacement)

Or

(2) Purchase Replacement Goods and Sue for Replacement Cost

Front 37

Warranties on Quality of Goods

3 warranties

Back 37

(1) Express

(2) Implied Warranty of Merchantability - fit for ordinary purpose

(3) Implied Warranty of Fitness for Particular Purpose

Front 38

Implied Warranty of Fitness for Particular Purpose

Back 38

(1) Buyer has a Particular Purpose for Goods and
(2) Reliance on Seller to select Suitable Good
(3) Seller has Reason to KNOW of Purpose and Reliance

Front 39

Md* Rule on Privity for Consumer Goods

Back 39

No Horizontal Privity Required for Consumer Goods

- Horizontal privity - injury by person who did not buy product

Front 40

Disclaimers limit liability on...

Back 40

Eliminate Implied Warranties

Md* Implied Warranty of Merchantability cannot be disclaimed for Consumer Goods

Front 41

Non-Conforming Goods:
IF Performance is NOT PERFECT TENDER under UCC then Buyer has option to

Back 41

(1) Retain Goods and Sue for Damages Or
(2) Reject Goods and Sue for Damages

Front 42

Non-Conforming Goods with Accommodation: Seller Notifies Buyer that non-conforming goods offered as accommodation, Buyer has Option to:

Back 42

(1) Accept Goods
Or
(2) Reject Goods

ACCOMMODATION SEEN AS COUNTER OFFER