REG B-LAW Contract Law

Revocation By Offeror

The offeror can revoke an offer any time before acceptance by communicating the revocation to the offeror. The revocation can be direct or indirect.

Unilateral Contract

Only one promise is made by the offeror, a promise exchanged for an act.

Advertisments

Ads are generally NOT offers, but invitations to negotiate. An ad is a offer only if its a promise for something specific.

Death of Offeror

The death of offeror prior to acceptance terminates the offer without notice to the offeree.

Elements of a contract

Offer, acceptance, and consideration

Malibox Rule

An acceptance of an offer is generally effective the moment it is sent (dispatched), not when received—assuming it's properly addressed and mailed by an authorized method. The rule applies unless the offer explicitly requires acceptance to be received to be effective

Consideration

The legal value( Not necessarily fair or fair) through a bargained for echanged.

Sources of contract law

Derived from court decisions, it governs contracts involving Real estate, Insurance, Services, Employment, and intangibles (acronym RISE)

Uniform Commercial Code (UCC), Sales Article (Article 2)

A statutory law adopted widely in the U.S. that governs contracts for the sale of goods (moveable tangible personal property).

Fraud

Misrepresentation of a material fact, scinter(intent to deceive), intent to induce plantiffs reliance, reasonable reliance by plantiff, and damages.

Duress

Unlawful use of a threat to harm.

Undue Influence

Absuisng a position of trust or confidence

Mutual Mistake

Both parties are mistaken as to a basic assumption of the contract. If both parties are unaware of the existence of the subject matter - the contract is void.

Minors

Minors may disaffirm(cancel) anytime during minority and within a reasonable time after becomining an adult.

Statute of limitations

4 - 6 years to sue, measured from the date of breach

Statute of Frauds

Contracts that need to be evidenced in writing (MY LEGS mnemonic: Marriage, Year, Land, Executors, Goods, Surety) Contracts in which marriage is the consideratin, contracts that by their terms cannot be perofromed within one year,contracts for interests in land, contracts by exuctors to pay estate debts out of personal funds, contracts for sale of goods for $500 or more, and surety contracts.

• Only need to be signed by one party but can be enforced only against the one who signed.

• Terms can be stated in more than one document

Impossibility

Events make performance impossible(ex. desturction of subject matter or death of the party to perform services)

Accord & Satisfaction and subsitiute contract

An accord is an agreement to substitue one contract for another, and satisfaction is the execution(perfomance) of the accord. A subsituted contract discharges the original contract immediately.

Novation

Occurs when a new contract subsitutes a new party for a old party in an exisiting contract.

Parol Evidence Rule

Prohibits the admisson of prior oral or written evidence or contemporaneous oral statements to contradict the terms of a fully integrated written contract.

Material or substantial breach

At common law, the non-breaching party can be discharged from the contract if there is a material breach; if the breach is MINOR, ther is NO discharge, just damages. However, under the SALES ARTICLE, a non - breaching party can be discharged for any breach even a minor one.(perfect tender rule)

Once a breach occurs, the non breaching party may be entitled to the following damages

• Compensatory: money to put the non breaching party in the position they would have been in had there been no breach.

• Specific performance ( For land or Unique items): A court order requring the breaching party to perform.

• Liquidated Damages: Damages agreed to in the contract, must be reasonable and not a penalty.

Punitive Damages

These punish the defendant, they are usually not avaible for breach of contract