Exam 1 Review

The difference is an implied contract doesn't entirely rely upon words - sometimes the parties' actions can be an indication of a contract.

Whereas in an express contract, it is the words (whether written or oral) that make up the contract.

The difference is, in a unilateral contract there is only one promise in return for performance. Whereas in a bilateral contract, there are two promises.

If the contract has to be in a certain form, it is formal. Whereas if the contract does not have to be in a certain form, it is a simple contract/informal contract.

1. Agreement
2. Consideration
3. Capacity
4. Legality

If an offer is made, the acceptance has to be the exact mirror image of the offer or else a counteroffer is being made.

current.

1. Offeror can revoke the offer.
2. If either party dies or becomes incopacitated, the offer is void.

Advertising is considered to be an invitation for the parties to submit an offer. The ad itself is not an offer.

1. Communicated to the offeree
2. Mailbox rule, if receiving an offer via mail, it's implied that if you responde in the same way you received it or faster it is accepted once sent- not once delivered.

Parties' words and actions will be interpreted from the perspective of a reasonable person and such words and actions are serious.

If someone does something that they were already bound to do, or were obligated to do.

Something the party has done in the past, is not consideration.

Doesn't always have to be the giving of money. It could be giving up something you had the right to do.

Under UCC, if there is a contract between the parties that is being performed, and one asks for a concession (a price increase or agrees to accept less), and the other agrees - THAT IS CONSIDERATION and the parties are now bound by this new contract.

This can be a substitute for consideration - when one relies on a promise so much so that they do actions to their detriment they would have normally not done.

Generally amounts to a contract - when one party agrees to give another party something that may be less than what they wanted but once they accept it they no longer have a legal claim.

Necessaries (food, shelter, clothing, transportation)

Not everything else. Until they turn 18. They can disaffirm the contracts for a limited time after they turn 18, but if they do not it becomes ratified.

This is generally binding as long as it is not too long (a few years) and does not cover too wide of an area geographically.

The burden of proof is on the party that was intoxicated to prove they entered a contract while uncapacitated. However, they are responsible for necessities.

If a person has been to court and a guardian has been appointed to them - all contracts with them are now void and the court guardian is the only one who can enter into contracts for that person. Even necessities! If a court guardian has not been appointed, mentally incompetent people are responsible for necessities.

If one person did not know the contract was illegal, they are still entitled to compensation or the affirming of the offer.

If a party needs to have a license to enter into a contract (lawyer, doctor), and they don't, any contract they enter into is not unenforceable.

Duress which is when someone threatens you with something they have no right to do in order to get you to agree to do something.

Undue influence is when a party is relying upon another party for advice, and the advising party uses that to their advantage to get the party to sign a contract that unjustly benefits them (the drawer of the contract).

Mistake, when mutual, can release either party from the contract. When only one is mistaken, there is nothing to be done.

When one party knowingly represents a fact that is not true, it is fraud. When one party unknowingly represents a fact that is not true, it is misrepresentation.

Both cases make an exception for "sales talk", when one party gives an opinion that is not fact. However, if it is given by an expert, then it is not an opinion.

1. Contracts for real estate
2. Marriage and marriage as consideration
3. Execution requiring more than a year
4. Contracts for the sale of goods over $500 5. Contracts to answer for the debt or duty of another

If the parties have a contract that appears is the entire writing, then any oral or written agreements that were entered into at the same time or before, are not permited as evidence to change anything in the written agreement (presumed to be complete)

Suretyship: I'll pay someones debt without any conditions
Guaranteeship: I'll pay that persons debt with conditions. Typically only if they don't pay themselves.

Both require writing. The exception to the writing requirement is, under guaranteeship, the main purpose rule.
Main purpose rule: When you made the promise with the main purpose of benefiting yourself, then it doesn't need to be in writing.

When you assign a right, the party that originally had the rights no longer has them. HOWEVER, when you deligate a duty, you are still required as a backup to perform said duty if the assignee does not.

Creditor third party beneficiary is typically intended because the performance is made to the third party creditor beneficiary.

Only intended beneficiaries have rights, incendental beneficiaries do not. Intended beneficiaries are the REASON a contract was entered into.

The party who is supposed to receive the performance, they must accept the delegation unless they relied on the expertise of the delegator.

Assignments are invalid if the reassignment materially alters the conditions of the contract (such as an insurance policy on one person and their car, cannot be assigned to another person with a different or same car).

Agree to an accord and satisfy that accord. This second contraact, accord, is satisfied in place of the original contract and thus both are satisfied.

If a party can convince the court that a condition can no longer be performed due to unforeseen circumstances (commercial impracticability).

Novation, where one party takes the place of another party and all 3 parties agree.

When one party is in material breach (means they have fallen below the level of substantial performance, which discharges the other party)

Precendent: in order to occupy a dorm room , you must be a student.
Subsequent: bankruptcy, divorce, etc are typical conditions in which there is a subsequent condition

Equitable remedy: sometimes the writing does not represent the agreement and the court will reform the contract to better suit their agreement (reformation).

The nonbreaching party may only sue for damages or specific performance, not both. (money or the follow through of the performance promised)

Normally, the nonbreaching party is entitled to the difference between what they were supposed to get and what they actually got due to the result of the other party's breach.

Incedental damages, such as legal fees, expenses to resolve the contract elseware, etc. are almost always included as well.

Consequential damages are damages that arise because of the breach (example is loss of profits due to late opening when that was expressly communicated in the contract that time was of the essence)

When you confer a benefit from another party but there is no real contract, the courts will step in an create a fictional one and assign damages as if that were their contract.

Typically this occurs when a contract was supposed to be in writing, but was oral, and one of the parties performed. The other party is trying to get out of it because it wasn't in writing, but the court can then put it into writing and enforce it.

This is usually made available as a remedy to the buyer of land, however they could instead sue for damages which is typically the market value of the land AT THE TIME OF BREACH OF CONTRACT.

This is also available for specific personal property or services.

1. Shipping the goods immediately is a form of acceptance of sale contract
2. If they cannot be shipped immediately, notifying the buyer that there is a delay but the product will be shipped and the contract is accepted.

If the merchant makes an offer in writing that is to remain open for a certain amount of time, it must stay open for that amount of time OR 3 months (whichever is less) (even when the other party did not provide consideration)

if the parties cannot agree on a contract, the court may submit these types of evidence to determine the true intention of the contract:
1. course of dealing (has to do with previous contracts and how they were dealt with)
2. usage of trade
3. course of performance

the relevance of evidence is important.

any contract for $500 or more must be in writing an exception under the UCC relates to unique goods. if the goods are unique, or are made especially for the buyer, they can be enforced even if theres no writing.

if theres a communication sent by one MERCHANT to another, and in response there is one or more additional terms that don't materially change the contract, and the receiving party does not reject within a reasonable period of time, these additional terms are accepted as part of the contract.

courts have the power to determine where the place of delivery is if the parties left it out of their contract.

Express Warranties: words have been used to say facts about the product, and if that is breached then itd be a breach in express warranty.

Warranty of Merchantability: only from merchants!!! promises the goods will be of at least average, fair, or medium grade quality that would be pass without objection to trade for other goods of the same kind. and must adhere to the statements on the packaging and intended ordinary use of said good.

Warranty for Fitness of a Particular purpose: doesn't need to be by a merchant, but it exists when the person giving the recommendation knows the party is relying on their recommendation and the party IS relying on their recommendation.

Warranty of Title: can be anyone, you have expressly stated you have title over this good and can give or sell it freely. aka it wasnt stolen.

You can express the disclaimer orally or written, or you can express that the goods are sold as-is with any faults or damages.