Review of Contract

Contract

agreement between 2 or more parties who agree to perform some act now or in the future which can be enforced in court.

Objective Theory of Contracts

determine contract and terms means by outward facts and the surrounding context. Determines by the “Reasonable Person” standard.

Elements of a Contract

Agreement

Consideration (Value)

Contractual Capacity (legal ability to enter into contract)

Legality

Agreement

• Offeror must have serious intention to become bound by offer

• Terms must be reasonably certain or definite

• Offer must be communicated to offeree

Termination of Offer

• Acceptance

• Prior to Acceptance:

  • Action of the parties

  • Operation of Law

Who can accept?

only offeree or that person’s agent

Consideration

something given in exchange for a service rendered

Must have “legally sufficient value” & “Bargained-for exchange”

Legally Sufficient Value

Consist of:

• Promise

• Performance

• Forbearance (Hamer v. Sidway)

Bargained-for Exchange

Must provide a basis for the bargain - item of value must be given or promised in return for promise, performance, or promise of performance

Adequacy of Consideration

court will not ? the adequacy of consideration based solely on the comparative value of things exchanged

(leaves it to the parties to decide worth)