The Everything Deck

“A promise or set of promises for the breach of which the law gives a remedy or the performance of which the law in some way recognizes a duty.”

Substitutional, not specific.
Compensatory, not punitive.
Expectation interests is the general one we use.
Expectation: Gives you your expectation from what would be gained from the contract. Same position as full performance of the contract.
Reliance: P in same position as if the contract had never been made.
Restitution: D restore to the P the reasonable value of the benefit conferred by P on D.
Disgorgement: Makes D give P all the benefit s/he derived regardless of the source.

Unilateral: One party makes a promise up front in exchange for the other party’s performance.
-The promisee is not obligated to perform, no promise; promisor basically is leaving it up tot he promisee to perform.
--Example: Reward to find my dog.
Bilateral: Each party makes a promise to one another. K is formed up front when the promise is exchanged.

Good 2-105-107 (1) – Goods movable and identifiable.
Includes crops, actual sales, and can be attached to real property.

Either: Deals with goods of the kind OR
Person by occupation with knowledge or skills of the practice
But Must:
Must be in their field - “mercantile capacity.”
UCC 2-104

UCC 1-201: Any kind of symbol anywhere on the document with intention to accept.

A performance or return promise is bargained for if it is sought by the promisor in exchange for his promise and is given by the promisee in exchange for that promise. RST 2 § 71 (2)

An act, forbearance, creation or destruction of legal relation. 71 (3). For example, in Hamer, the nephew forbear from drinking and smoking.

What is bargained for does NOT have to be the main motive of inducing performance or promise, but it has to play at least SOME role. 2R 81.

A promise to give a gift OR any promise that is not supported by consideration.
Examples: Kirksey and Feinberg.

A promise is conditional if its performance will become due only if a particular event, known as a “condition,” occurs.
-Insurance contracts and even a satisfaction clause.

A bilateral contract where the breaching promisor was looking for a promise in return. The problem is that the promise is an illusion with a free way out.
-Ex: Satisfaction clauses are not illusory. Court reads in Good Faith.

Requirements/Outputs Contracts (2-306):
Requirement contracts: Buyer has to buy its requirements from Seller.
Output Contracts: Buyer is required to purchase the seller’s entire output of goods.

1)Actual Requirements
2)Good Faith (Honesty in fact (subjective) and Reasonable standards of Fair dealing (Objective))
3)Not unreasonably disproportionate.
-Don’t take the seller by surprise.

Good faith is read in to make consideration because “No Damn Fool” would tie up their rights like that.
Common Law (Wood): Have to make reasonable efforts on their end.
2-206(2): Best Efforts.

change of position by the promiseee as a basis for enforcement for the promise that is separate from consideration. Was there reasonable reliance on the promise? Look at perspective of promisor:
Promisor should REASONABLY EXPECT TO INDUCE ACTION OR FOREBEARANCE on the part of the promisee or a third person and which does induce such action or forbearance is binding if injustice can be avoided only by enforcement of the promise. The remedy granted for breach MAY BE LIMITED AS JUSTICE REQUIRES (usually reliance interests, but sometimes expectation (Feinberg). RST 2 § 90.

Family promises: A promise made by one family to another, on which the other relies.
Scothorn and Sister Antilico in Kirksey.
Promises to convey land: Recipient of a promise to convey land relied on it by moving onto the land and making improvements.
Charitable subscriptions: Promises to contribute to a nonprofit.

Unjust enrichment: unjust enrichment of the D at the expense of the claimant.
P needs to prove that D was enriched (received a benefit), and that retention of the benefit without payment therefore would be unjust.
Note: No restitution for volunteers.

Rst 24 is for offer.
Corbin Def: One person confers the ability on another person the power to create contractual relations between them.

Look from the perspective of the offeree would think it is a reasonable offer (Objective: look at the actions and words of the offeror. Subjective: What did the offeree think)
Buzz words: clear, definite, explicit, and leaves nothing open for negotiation.
-look for price terms, quantity terms and things like that
-Price quotes and ADS are generally not offers, but Lefkowitz was the exception.

A loose definition under 2-206: order or other offers inviting acceptance by prompt promise to ship or prompt or current shipment of goods.

Mistake: A belief that is not accord with the facts.
Unilateral: One party makes a mistake (Kastorf, hypo, 2R153).
-The mistaken party has to bear the mistake unless
----It would shock the conscience of the court or
----The other party had reason to know.
Mutual mistakes: Both parties share a false belief.
-Not automatically voidable, but voidable by either party RST (152)
Misunderstanding: When both parties think they have something, but they don’t (chicken means this or that).

1)Did the other party (usually the acceptor) have knowledge or reason to know?
----Maybe the bid was too good to be true.

2) Did the party give Prompt notification?
3)What is the nature of mistake?
--Computational mistake
--Judgment mistakes
4) Revoke the offer with a mistake before acceptance.
5) Size of Mistake
6) Did the injured party rely on the bid?
7) Offeror try to restore the status quo?
8) Would holding the mistake party liable be unconscionable? (Shock the conscience of the court)

Lapse, Revocation, Offeror's death or incapacity, Rejection

Offer lapses after a reasonable period of time. This can depend on the cirumstances.
In face2face convos: offer only open until end of conversation.

General Rule: offer can be revoked at any time unless it was irrevocable.
§42: Direct revocation
§43: Indirect Revocation: Offeror takes definite action inconsistent with an intention to enter into the proposed contract and offeree gets reliable info to that effect.

Provide consideration.
Reliance on an offer before acceptance
Signed writing (includes UCC)
New York Statutes

§25 Option contract: Gives the buyer an option to say yes or not to the contract which buys them time.

UNILATERAL: §45: Once the promisee or offeree in a unilateral contract BEGINS PERFORMANCE, the offeror can no longer revoke.
----preparation is not enough
BILATERAL: §87(2): Where the offeror can reasonably expect the offeree to realy before acceptance.

2-205 Firm Offers:
-Signed record
-Between merchants
-by its terms gives assurance that it will be held open
-for a reasonable time that does not exceed three months.
87(1): In writing or made irrevocable by statute.

Changing up the terms is a rejection and a counteroffer.
From perspective of offeror, reasonable rejection?
Asking a question is not a rejection.

RST 50: manifestation of assent to the terms made by the offeree in the manner invited or required by the offer.
Test: Look at it from the reasonable offeror’s perspective now for what would constitute acceptance (look at language and circumstances). (both objective and subjective)
Words: Acceptance must be absolute, unequivocal, and unconditional, and it may not introduce additional terms or conditions.
UCC 2-206: Any reasonable manner.

Unilateral: Not requirement because performance completes the contract (§54)
Bilateral: Notice is required for acceptance unless a term or other situation explains otherwise. (§56)
- Use reasonable dilligence to notify offeror.

General rule, no.
Exceptions:
Course of dealing or prior relationship
If by terms (§69): Silence can be acceptance if the offeror says so and the offeree intends to accept.

-ONLY APPLIES TO REVOCABLE OFFERS
-Acceptance is "when its sent" (2R§63)
-Revocation is effective on receipt (§42-43)
-Rejection is also effective on receipt (§40)
When you get this deck, go to outline and go through problems.

Mirror image rule: Terms of acceptance must exactly mirror terms of the offer (identical and absolute)
-if not counters or rejections

Court can read in implicit term
-Fairmount Glass, “first quality” goods
Court can find O’ee is merely requesting additional terms (not required to accept K)
Court can find it is an insignificant (de minimis) change

Three options:
Majority rule: Apply the knockout doctrine to the two terms and put gap fillers.
Minority rule: Offeree’s discrepant term drops out and offeror’s wins.
CA/Sok Minority: Equate different with additional and run it through sub (2) regardless.

First, 2-207 (1):
- “definite and seasonal” expression of acceptance
-----Terms are so significant that it is not definite
-OR “written confirmation which is sent within reasonable time operates as an acceptance even though it states terms additional to or different from those offered or agreed upon."
------Not silence
-UNLESS acceptance is EXPRESSLY MADE CONDITIONAL on assent to the additional or different term.”
-----offeree makes it absolutely clear he will only make it bound to the contract if offeror accepts to the terms.
------ GO TO SUB 3 Here.

Go to 2-207(2):
First, check for merchants. If not merchants, new terms are just proposals.
If merchants, they are still proposals unless:
1)Offer expressly limits acceptance to the terms of the offer.
2)It materially alters it (result in surprise or hardship (Bayway)”
---If it’s some common alterations in the industry, not material.
------Usage of trade (1-303): regular practice in place, vocation, or trade.
---Material alterations
------Disclaimers of warranty
------Arbitration clauses
------Forum selection clauses.
3)Notification of objection has already been given or given within a reasonable time after notice is received

Go to 2-207(3)
If parties act like there is a contract, then there is a contract.

To modify a contract after o/a, you need to have consideration. (Pre-Existing Duty Rule §73). Without it (like being put under duress), the modification is no good!
---Example, Alaska packers.

Look for just about anything to be consideration.
-§89: Modification of executory contract (means both parties still have some performance remaining) is allowed:
-------If fair and equitable in view of circumstances
-------Provided by statute
-------to the extent justice requires enforcement in view of material change of position in reliance on the promise.
Other ways:
Unanticipated or unforeseen circumstances
-----Watkins: Solid Rock was discovered and would be a lot more expensive to excavate.
Rescission + New K (Schwartzreich)
-----Tore up the old contract and drafted a new one. .
State Statutes get rid of it?

SOG 2-209(1): Needs no consideration to be binding.
Dispenses consideration requirement as long as there is good faith. (HIF)
Exception to this, if there is a singed agreement that excludes modficiation, you need another signed agreement to modify it.

It can be treated as a waiver. You can waive your right to it. This waiver can be extracted at any time, BUTTTTT to the extent that the other party relied on it (2-209 4&5)

M Marriage
Y Year (One year provision)
L Land
E Executor
G Goods (SOG>/= 500$ (2-201) S Suretyship

If a contract cannot be fully performed within one year of the day in making.
Note: We don't care if performance takes more than a year. The question is theoretically is there any possibility that the contract can be fully formed within one year of the contract being made.
For example, lift-time contracts and termination clauses do not count bc they could be terminated or you could die within one year.
However, a contract with a two-year provision by definition falls under SOF.

Transfer of any interest in Real Property
-----Leases, Mortgage, Easements

2-201: Any sale of Goods equal or over 500$. Can be merchants or not.

When there is a promise to answer for the debt of another.
Does not count for :
Direct obligation: Promises to pay the creditor separately
Novation: Substitute one pary for another (one party is liable and that is it)
Third party beneficiary

1)Must contain ALL material and essential terms in writing.
-----Identity, nature, and essential terms.
-----Link together a number of writings as long as they all relate to a transaction.
2) Signed writing (symbols aren't enough for CL)

1)You need evidence that a contract has been made
2)Signed by the party against whom enforcement is sought.(Signed by the D.)
------If one party has a writing signed by another, but him or herself did not sign, they might be able to enforce it on each other.
-------Signed can mean signature, symbol, headers, and even stamps.
3)You have to have a quantity term.

For real property
-“Part Performance Exception” (⅔ of the following must be met)
------Buyer must have made at least some payment to the seller with respect to the real property.
------Buyer must be in possession of the property.
------Buyer must have made permanent improvements.
For Year: Full Performance
For Suretyship: “Main purpose”: if the surety’s main purpose was to secure his or her own benefit, then no writing is necessary.

1)Specially manufactured goods.
----Seller is manufacturing goods that would only buitable to the buyer’s needs and made a substantial beginning on the manufacture.
2) Judicial Admission (admission in court)
3) Part Performance
4) Merchants confirmatory memo or the “read your mail” exception

Good paid for by the buyer and the seller takes the money. OR
Goods that have been received and accepted by the buyer.
-------HOWEVER partial performance as a substitute for a memorandum only for the goods that have been accepted or for which payment has been made or accepted.
--------f they only gave them a quarter of the money in the contract, you can maintain a SOF defense for the other goods.

1) “Between merchants
2) if within a reasonable time
3) a record in confirmation and sufficient against the sender is received. 10 days passed w/o recipient objecting to it with an SOF defense.”

If you relied on an oral contract that falls within the SOF, your reliance may be protected by barring the other party from making a SOF defense. However, Texas does not care.

Collateral evidence that someone might be making up that is outside of the writing. It may prevent a promise that was actually made.
Matter of timing: In order to even consider it, it has to be an oral promise made before the signed writing or at the same time as the signed writing.
NOTE:Oral contracts afterwards do nothing.

Merger clauses:
"There are no promises, verbal understandings, or agreements of any kind pertaining to this contract other than those specified herein."
"This writing constitutes a complete and exclusive statement of all the terms of our agreement.

Mitchell (Traditional) and Masterson (Modern)

Would you naturally expect this collateral term to be in the writing if it had been agreed to?
-Focus on Writing. -Must not contradict express or implied provisions.
-Must be one that parties would not ordinarily expected to be embodied in the writing.
-If it would normally be in the writing, it does not come in. If it would not normally be in writing, then maybe it does.

Evidence of oral collateral agreements should be excluded only when the fact finder is likely to be misled.
Permits proof of a collateral agreement if it is "such an agreement as might naturally be made as a separate agreement by parties situated as were the parties to the written contract."

Under §216: If all the terms are completely integrated, PER can’t contradict or supplement.
If only partially integrated, it can include evidence of any additional or supplemental terms as long as they're consistent with the terms.

UCC 2-202:
-Can't contradict confirmatory memorandum's final terms.
-Can't add terms that would have CERTAINLY been included.
-Can add additional or supplemental terms by
------Course of dealing, Usage of trade, or by course of performance and.
------By evidence of additional terms (not certainly).

RST 214
1) Writing is or is not an integrated agreement
2) the meaning of the writing.*Modern Approach (with PG&E has the baseline)
3) ground for granting or denying rescission, reformation, specific performance, or other remedy.

PG&E Modern Approach
WWW (Traditional Approach)

Look everywhere to figure out what a term means (Reasonably susceptible Test).
When you have an ambiguity in a term, you can look at the meanings from both parties even if they make them more ambiguous.
Laugh Test: If you aren’t laughing for how outrageous the meaning that is being argued, then the evidence is going to be allowed in. (term in writing just has to be reasonably susceptible)

Go with that meaning

Go with the shared reason.

If the opposite party knew or had reason to know that the other party was using that meaning, we go with that meaning.
If neither party had reason to know or both party had reason to know.
----There is no contract at all (BUT OVERALL courts are rare to find no contract. They will pick a side.)

Usage of Trade (1-303): Any practice or method of dealing having such regularity in a place, vocation, or trade as to justify an expectation that it will be observed with respect to the transaction in question. The existence and scope of such a usage must be proved as facts.
Course of Dealing (1-303b): How parties act in prior contracts.(look at their previous dealings.
Course of Performance (1-303d): How parties act under this contract.

You could look for UCC gap fillers, read in implied promises, or read in implied waranties as well.

2-300's

UCC 2-314: An implied warranty that goods will be merchantable as long as the seller is a merchant with respect to the goods of the kind.
- one who deals in goods of the kind or knowledge of the goods or practices involved in the transaction.

Merchantable: Must be at least such as are fit for the ordinary purpose for which the goods are used. These boots were fit for walking.

UCC 2-315: When seller knows or has reason to know the buyer has a special purpose in mind
1) Seller must also know or have reason to know that the buyer is relying on the seller to select suitable goods for the buyer's purpose.
a)Buyer needs to be chatty and tell seller stuff.

2-313: The language must mention “merchantability” or “implied warranty of fitness: and in a writing that is conspicuous.
Put it in bold or make it a larger font.
ITS GOTTA BE SO CLEAR

Warranty that is the product of bargaining between the parties rather than implication by law.

2-313:
1) An AFFIRMATION OF FACT OR PROMISE made by the seller with respect to goods creates a warranty that they will conform to that affirmation or promise.
2) A DESCRIPTION OF GOODS creates a warranty that they will conform to the description.
3) A SAMPLE OR MODEL OF GOODS creates a warranty that the “whole of the goods” will conform.

It has to the basis of the bargain/agreement!

Is an event, not certain to occur, which must occur, unless its nonoccurrence is excused, BEFORE performance under a contract becomes due. (RST 224)

extinguishes a duty after performance has become due, along with any claim for breach.
-----Cuts off performance. An event occurs that terminates a party’s performance. Like not really a condition at all.
------UNTIL

(Trigger) is any conditions under the RST.
Condition that precedes performance. It happens before performance becomes due.

A condition expressed in the contract.
-It requires strict compliance: the part HAS to fully comply with it.
-Example: Satisfaction Clauses
----Can’t be dissatisfied only with the deal, but maybe something within the terms of the contract. This is good enough.
-Don't be too ambiguous in your express conditions. (This was the problem in Peacock).

Conditions implied in the contract like, you have to work first before I pay you. The doing has to come before the paying!

Substantial performance doctrine: You did almost everything so the implied condition is that this is good enough.
You can still get damages.
Injured party still has to perform.

§241: Did not substantially perform
-Can get damages
-Injured party has an excuse for not performing
-Big question comes up as to "who made the first substantial breach?"

Check for the factors under §241:
(a) the extent to which the injured party will be deprived of the benefit which he reasonably expected;
(b) the extent to which the injured party can be adequately compensated for the part of that benefit of which he will be deprived;
(c) the extent to which the party failing to perform or to offer to perform will suffer forfeiture;
(d) the likelihood that the party failing to perform ...will cure his failure, taking account of all the circumstances including any reasonable assurances;
(e) the extent to which the behavior of the party failing to perform... comports with standards of good faith and fair dealing.

Seller has to make perfect tender (seller perfectly gives the goods or tender promised). If seller doesn’t, Buyer has free reign!

Accept the whole
Reject the whole***
Accept some of the units and reject the rest.
(Regardless of which of these the buyer chooses, buyer can still get damages under 2-714).

Yes, but it depends on whether the time or the seller's performance has expired.
Also, if the seller has reason to believe that the buyer would take whatever the goods are based on their prior dealings, Court may gie leeway and allow seller to substitute conforming tender.

NO.
Under 2-612 Buyer may reject an installment only if there is substantial impairment in the installment that can’t be cured.
Buyer can reject entire K only IF a defect in an installment substantially impairs the value of the entire K.

Under 2-602, Acceptance is not implied until after having a reasonable time to inspect the goods.

Must be w/in reasonable time and notify the seller of rejection. (After reasonable time to inspect the goods)

Usually, no, but a buyer can revoke acceptance if the non-conformity substantially impairs the value of the goods and was difficult to discover (ie, if it was a latent defect).
---This has to be done in good faith.
---If they revoke it, they can return it at the sellers expense, get a refund, and get damages for breach of contract.

Under UCC 2-511, Mutual tender requirement (do it at the time of getting the goods). Any means or manner unless buyer demands a legal tender.
If buyer gives seller a check, but seller demands cash, buyer gets reasonable time to get cash.

A remedy for a market when the market isn’t availabile. Making the D put the injured party in the same place as full performance by making the D perform according to the terms of the contract.

Real Property, Service K's (rare but could happen), and Sale of Goods (2-716)

Full Formula: Reliance + Profit + other loss -loss avoided.
Another Forumla: Loss in value - cost avoided +other losses - losses avoided.

When you get this deck, go to the outline and go through the Sulak hypos.

Vitex says no. Overhead never changes. If expectations is K price -direct costs (this is loss profit). Overhead would have incurred regardless so it is not really a direct cost here.

Buyer: Includes transportation, receiving, caring, charges in connection with cover.
Includes costs incurred in a reasonable effort, whether successful or not, to avoid loss.
Seller: Reasonable charges, expenses, or commissions occurred in stopping delivery, transportation, care, and custody of goods after buyer breached in connection weturn or resale of goods or otherwise resulting from the breach.

As a result of breach, something else happens. (Rare and hard to prove lowk)
Harm to persons or property as a result of the breach.
Must be reasonably foreseeable.

1) Cover (2-712)
2) Market (2-713)
3) Specific Performance (2-716)
4) Outlier situations when the buyer is stuck with the goods. (2-714).

Cover (2-712) is when the Buyer purchases substitute goods. (NOTE BUYER DOESN'T HAVE TO COVER)
Requirements:
1) Good Faith (honesty in fact and observance of reasonable standards of fair dealing)
2)Without unreasonable delay
3)Reasonable Purchase
4) Goods in substitution for those due to the seller (not a much higher quality).

Damages: Cover price - K price (same as loss in value- cost avoided) + incidental or consequential damages -Expenses saved.

When buyer chooses not to cover or cover doesn’t meet requirements. (UCC 2-713)
Damages: Market price at the time the buyer learned of the breach.
Market Damages= market price - K price + I/C costs - expenses saved.

UCC 2-716. When good are unique or no substitute market or no cover
Other proper circumstances: Buyer’s inability to cover is strong evidence.

2-714 Damages: Buyer gets difference: Value of foods as promised -value of goods delivered.

Resale (2-706)
Market (2-708)
Action on the price (2-709)
Outlier: Lost Volume Seller (2-708)(2)

Cover for Seller where they resell the goods. (UCC 2-706)
Requirements:
Good Faith
Commercially Reasonable Manner
Injured seller must provide buyer w/ reasonable notice.

Damages: K Price - Resale price +Incidental (not consequential) damages = Expenses saved.

When the seller chooses not to resale, or fails to meet resale requirements. (UCC 2-708)
Damages: K Price - Market Price (at time and place for tender) + Incidental Damages - Expenses Saved.

When there is no market, specific performance (Seller gets full contract price) (UCC 2-709).
Requirements:
Reasonable efforts to sell & can’t or
It if very unlikely seller would be able to find substitute buyer.
Damages: K Price.

Seller resells, but is a lost volume dealer. (2-708(2), Diasonics)
Requirements (to prove):
Seller has capacity to make multiple sales.
Would have made second sale absent the breach.
Additional sales would’ve been profitable.

Damages: Damages: Lost profit (includes reasonable overhead) + incidental damages.

When looking at a employer contract, look for a butt-for relationship to see if the employee could have been two places at once.

Damages for wrongfully discharged employee= amount of salary agreed upon - amount which employer can prove employee has earned or could have earned from other employment with reasonable effort.

In doing so employers have to prove that the other opportunity or job is not inferior in any way (arguably a different case for Shirley).

Avoidability, Forseeability, and Certainty.

You can’t recover for damages you could have avoided through reasonable effort.
Damages are fixed at the time of breach.

You can’t recover for all your damages, just those that were reasonably foreseeable by the breaching party at time of the K.
----Breaching party must have reasonably (objective or subjective) been able to foresee damages @ time of K formation.

Reasonable certainty that these were the damages.

New businesses, Damage to Reputation, and Works of artistic creation.