Updated Terms Freq Missed

Offer Revocability — General Rule

An offer is revocable at the will of the offeror at any time before acceptance — even if the offeror promised to keep it open. EXCEPTIONS (3): (i) Option contract (offeree pays consideration to keep offer open); (ii) Firm offer under UCC §2-205; (iii) Temporary irrevocability from offeree's part performance or detrimental reliance.

UCC Firm Offer (§2-205)

Irrevocable WITHOUT consideration if: (i) offeror is a MERCHANT; (ii) offer is in a SIGNED WRITING; (iii) offer gives explicit assurance it will stay open. Duration: stated time period governs; if none stated → reasonable time. Cap: cannot exceed 3 months of irrevocability, even if the writing says longer.

Battle of the Forms — Additional/Different Terms (UCC §2-207)

If ANY party is a non-merchant: additional/different terms = mere proposals, do NOT become part of contract unless offeror expressly agrees. If BOTH parties are merchants: additional terms become part of the contract UNLESS (i) they materially alter the offer, (ii) the offer expressly limits acceptance to its own terms, or (iii) offeror objects (already or within a reasonable time). Different (conflicting) terms: split of authority — some states apply the same rule as additional terms; others use the KNOCKOUT RULE (conflicting terms cancel out, gaps filled by UCC gap-fillers). Knockout rule applies ONLY to conflicting terms, never additional terms.

Mailbox Rule

Acceptance by mail/similar means is effective at the moment of DISPATCH (posting) — EXCEPT: (i) offer states acceptance effective only upon receipt; or (ii) an option contract is involved (acceptance effective on receipt). Rejection is effective upon RECEIPT, not dispatch. If offeree sends acceptance FIRST, then rejection: acceptance is effective on mailing (contract formed) even if rejection arrives first — UNLESS offeror detrimentally relies on the rejection. If offeree sends rejection FIRST, then acceptance: whichever is RECEIVED first controls.

Consideration — Requirements

A promise is supported by consideration if: (i) promisee suffers a legal detriment (gives up something of value or limits their liberty); AND (ii) the promise is part of a BARGAINED-FOR exchange for that detriment.

Illusory Promise vs. Conditional Promise

Illusory promise: promisor retains an UNRESTRICTED right not to perform (e.g., right to cancel at will) → NO consideration → no contract. Conditional promise: performance depends on an event OUTSIDE the promisor's control → VALID consideration. Test: if the promisor controls whether the condition occurs → illusory; if an outside event controls it → not illusory.

Pre-Existing Duty Rule

Doing or promising to do what one is ALREADY legally obligated to do (or forbearing from something one has no legal right to do) is NOT a legal detriment → does NOT constitute consideration.

Pre-Existing Duty Rule — Modification Workaround

To avoid the pre-existing duty rule, a contract modification that benefits only one party must be supported by NEW CONSIDERATION. A modification solely benefiting one party is unenforceable without new consideration.

Pre-Existing Duty Rule — Debt Discharge

A creditor's promise to accept partial payment in full satisfaction of a debt is generally NOT binding (no new consideration). Exceptions — partial payment CAN discharge the full debt if debtor also: (i) provides additional security; (ii) refrains from bankruptcy proceedings; (iii) arranges a composition agreement; OR (iv) pays part of a genuinely disputed claim.

Statute of Frauds — Surety Exception (Main Purpose Rule)

A promise to guarantee another's debt must be in WRITING — UNLESS the guarantor's PRIMARY PURPOSE was to benefit themselves (not to help the debtor). If the main purpose was personal economic benefit → no writing required (not truly a surety).

Statute of Frauds — Interests in Land

A promise creating an interest in land must be in writing, including agreements for sale of real property AND leases for more than one year. Exception: part performance doctrine.

Statute of Frauds — Part Performance (Real Property)

An oral contract for the sale of land is taken out of the Statute of Frauds by part performance if the conduct unequivocally indicates a contract exists. Most jurisdictions require at least TWO of: (i) payment (whole or part); (ii) possession; (iii) valuable improvements.

Statute of Frauds — UCC Goods ($500+)

Contracts for goods valued at $500+ must be evidenced by a WRITING. EXCEPTIONS (no writing required): (i) specially manufactured goods unsuitable for resale; (ii) contract admitted in court by the party to be charged; (iii) contract partially accepted/paid for (enforceable only to the extent of acceptance/payment).

Statute of Frauds — Subsequent Promise to Pay Barred Debt

The SOF bars the remedy on the original debt, not the debt itself. A new promise to pay that debt is enforceable. An intended TPB may enforce that new promise against the new promisor under the new contract.

Parol Evidence Rule

Bars extrinsic evidence of contract terms that CONTRADICTS, MODIFIES, OR VARIES the written agreement when that agreement is final and complete. Partial integration → bars contradictory terms only. Complete integration → bars any additional terms as well.

Merger Clause (Parol Evidence)

A merger clause establishes complete integration → bars parol evidence to ADD TO or VARY the written terms. However, a merger clause does NOT conclusively establish complete integration and does NOT bar extrinsic evidence offered to EXPLAIN an ambiguity.

Completely Integrated Agreement

An unambiguous written agreement that leaves no doubt the parties intended it to be the FINAL and EXCLUSIVE expression of their agreement on the subject. A merger clause is evidence of complete integration but is NOT conclusive.

Course of Performance / Dealing / Trade Usage — Priority Order

Courts interpret contracts by prioritizing: (1) Course of PERFORMANCE (conduct under the current contract); (2) Course of DEALING (conduct under prior contracts); (3) TRADE USAGE (industry-wide norms). Earlier sources override later ones.

UCC — Trade Usage to Interpret Agreements

Under the UCC, evidence of trade usage is admissible to interpret an agreement if the usage: (i) is regularly observed in the trade; AND (ii) does not contradict express contract language.

Modification vs. Accord & Satisfaction

Modification: immediately REPLACES old contract terms. Accord & Satisfaction: SUSPENDS the old duty until the new act is performed — old duty discharged only upon completion of the accord.

Implied Warranty of Fitness for a Particular Purpose

Arises when: (i) seller knows of buyer's SPECIAL PURPOSE; AND (ii) buyer relies on the seller's skill to select suitable goods. Merchant status does NOT matter — applies to any seller. Breach of warranty = breach of contract.

Risk of Loss — Nonmerchant Sellers

For nonmerchant sellers, risk of loss shifts to buyer once the seller TENDERS the goods (makes goods available AND notifies buyer how to collect). Risk does NOT shift at the moment of contracting.

Risk of Loss — Destination Contracts (FOB Destination)

In destination contracts (FOB destination), the SELLER bears the risk of loss until the goods physically arrive at the specified destination.

Shipment vs. Destination Contract — Default Rule

A contract requiring shipment by a third-party carrier is presumed to be a SHIPMENT contract (not destination) when the contract is silent. Under a shipment contract, risk passes to buyer when seller delivers to the carrier.

UCC — Tender of Goods / Payment (Silent Contract)

If the contract does not specify otherwise: seller must TENDER (make available) the goods; buyer's duty to pay is conditioned on seller's tender. Place of delivery = seller's place of business. Payment is due when and where buyer receives the goods.

Requirements Contracts (UCC)

A contract obligating the buyer to purchase ALL of its requirements of a good exclusively from the seller. No specific quantity term needed — 'all requirements' is sufficient quantity under the UCC.

UCC — Seller's Remedies on Buyer's Breach

On buyer's breach: seller may recover the DIFFERENCE between the contract price and resale price, OR LOST PROFITS. If resale is in good faith and commercially reasonable → seller recovers (resale price − contract price) + incidental damages − expenses saved. Buyer's deposit: seller may keep the LESSER of 20% of contract price or $500, even without proving actual damages; must return the balance.

Impossibility — Destruction of Subject Matter

Destruction of specific subject matter (the exact thing the contract required) makes performance OBJECTIVELY IMPOSSIBLE → excuses both parties from performance.

Impossibility — Personal Incapacity

The incapacity of a particular person to perform their contractual duty renders performance impracticable → operates as an excuse for nonperformance.

Condition — Good Faith Obligation

A performance subject to an express condition cannot become due unless the condition occurs or its non-occurrence is excused. However, the duty of good faith requires the party to make reasonable efforts to satisfy the condition. Failure to make those efforts prevents the party from using non-occurrence of the condition as an excuse.

Employment At-Will

Many employment relationships are 'at will' — terminable at any time, for any reason, by either party. Termination of at-will employment does NOT constitute a breach. A position described as 'permanent' still creates an at-will relationship.

Breach — Material vs. Minor

Material breach: breaching party fails to perform and non-breaching party does NOT receive the substantial benefit of the bargain → non-breaching party's duty to perform is DISCHARGED and may sue for damages. Minor breach: breaching party has substantially performed and non-breaching party DOES receive the substantial benefit → non-breaching party must still perform but MAY sue for damages.

Breach — Total vs. Partial

Total breach: severe breach that suspends or discharges the other party's obligation to perform. Partial breach: not material; aggrieved party must continue performing but has an IMMEDIATE RIGHT to sue for damages from the partial breach.

Anticipatory Repudiation

A party makes it unmistakably clear before performance is due that they will not perform → the other party may suspend or cancel their own performance. Does NOT accelerate installment debt when lender has already fully performed. Absent an acceleration clause, lender may recover only installments already due and unpaid.

Installment Contracts (UCC 2-612)

Perfect tender rule does NOT apply to installment contracts. Buyer may reject an installment ONLY if the defect substantially impairs THAT installment and cannot be cured. Buyer may cancel the ENTIRE contract only if the defect substantially impairs the contract as a whole. If seller gives adequate assurance of cure, buyer must generally accept the installment.

Consequential Damages — Foreseeability

Consequential damages for breach of contract are limited to those the breaching party had reason to foresee as a PROBABLE RESULT of the breach AT THE TIME THE CONTRACT WAS MADE (Hadley v. Baxendale rule).

Lost Profits — Certainty Requirement

A party cannot recover lost profit damages unless the losses are proven with REASONABLE CERTAINTY — not merely speculative.

Damages — Buyer in Land Sale Contract

Damages to an injured buyer in a contract for the sale of real estate = difference between the CONTRACT PRICE and MARKET VALUE as of the time the buyer learned of the breach, plus incidental or consequential damages.

Expectation Damages — Contractor Breach Before Completion

Formula: Contract Price minus Costs Avoided minus Salvage Value. OR: Net expenditures already made plus Expected Profit.

Restitution — When Used and How Calculated

Used when: (i) no enforceable contract exists; (ii) expectation damages are too hard to prove; or (iii) the deal would have resulted in a loss for the non-breaching party. Calculated by: what was ACTUALLY GAINED by the breaching party (unjust enrichment), not what was lost. Distinct from expectation damages which restore the benefit of the bargain.

Restitution — Breaching Party's Recovery

Even a BREACHING party may recover in restitution for the reasonable value of the benefit conferred on the non-breaching party through part performance, MINUS the non-breaching party's damages from the breach. An express condition requiring full completion does NOT bar this recovery if the breaching party had already begun performance.

Specific Performance — Land Contracts

Specific performance is the proper remedy for breach of a contract for land. All land is considered unique → specific performance is granted as a matter of course, not as an extraordinary remedy. Available to BOTH buyer and seller. Failure to perform by the exact time stated (absent a 'time is of the essence' clause) is neither a material nor substantial breach.

Specific Performance — General Requirements

Granted if: (a) valid contract exists; (b) inadequate remedy at law; (c) enforcement is feasible; (d) no defenses apply. A legal remedy is inadequate if damages are unique, difficult to calculate, impossible to collect, or the breaching party is insolvent.

Assignment — General Rules

Assignment transfers contractual RIGHTS to a third party (the assignee). The assignee steps into the assignor's shoes — receives rights subject to any defenses, setoffs, and counterclaims the obligor could assert against the assignor. Once obligor has knowledge of the assignment, must render performance to the ASSIGNEE. Assignment extinguishes privity between obligor and assignor; creates privity between obligor and assignee.

Delegation — General Rules

Delegation transfers contractual DUTIES to a third party (the delegatee). Delegator remains liable even after delegation — consent to delegation alone does NOT release the delegator. Release requires a NOVATION (express agreement by the obligee to substitute the delegatee and release the delegator). Non-delegable duties: (i) other party has substantial interest in original promisor's performance; (ii) contract requires special skill or judgment; (iii) delegatee is a competitor or there is a special trust relationship; (iv) contractual restriction on delegation.

Assignment vs. Third-Party Beneficiary

TPB: requires the ORIGINAL PARTIES to have intended to benefit the third party. Assignment/Delegation: transferee receives rights/duties from the original contract without needing intent to benefit them.

Third-Party Beneficiary — Vesting of Rights

An intended TPB's rights vest (and become irrevocable) upon: (i) the TPB's ASSENT; (ii) the TPB's RELIANCE on the promise; OR (iii) the TPB filing a LAWSUIT to enforce the contract.

Incidental Third-Party Beneficiary

A person who may incidentally benefit from a contract between others but was NOT the intended beneficiary → has NO enforceable rights under the contract.

Reformation — When Available

Reformation is available ONLY when the writing incorrectly summarizes the parties' SHARED understanding (e.g., clerical/scrivener's error). NOT available when the parties fundamentally disagree on the terms from the outset.

Tenancy by the Entirety — Divorce Effect

Divorce terminates the marital union required for TBE → automatically converts to a tenancy in common upon divorce.

Joint Tenancy — Transfer During Life

A joint tenant can transfer her share during life, but doing so SEVERS the joint tenancy as to that share → the transferee takes as a tenant in common.

Joint Tenancy — Lien vs. Sale

A judgment lien alone often does NOT sever a joint tenancy. But an actual FORECLOSURE or levy sale DOES sever it → purchaser receives the debtor's share as a tenant in common.

Adverse Possession — Cotenant Hostility

Because each cotenant has the right to possess the entire property, one cotenant's exclusive possession is NOT 'hostile' for adverse possession purposes UNLESS there has been an ouster of the other cotenant.

Adverse Possession

Elements: continuous possession for the statutory period that is (1) ACTUAL, (2) HOSTILE, (3) EXCLUSIVE, and (4) OPEN (notorious). TACKING: successive periods of possession by different occupiers may be combined if possession is continuous throughout.

Ameliorative Waste

Occurs when a tenant makes unauthorized changes that INCREASE the property's value. Still technically a violation of the other cotenant's rights even though the value goes up.

Life Tenant — Duty to Pay Taxes

A life tenant is responsible for real estate taxes and interest on the principal to the extent of income from the property. Liable to the future interest holder for taxes only to the extent of rents received, or the fair market value of the property if the life tenant is occupying it.

Vested Remainder — Transferability

A vested remainder is a property interest. The remainderman may sell, gift, or devise it before the life tenant dies.

Deeds — Covenants of Title

Present covenants (breached, if at all, at time of conveyance): (1) seisin, (2) against encumbrances, (3) right to convey. Future covenants (breached upon interference with possession): (1) quiet enjoyment, (2) further assurances, (3) warranty.

Valid Deed — Requirements

A deed is valid if it: (i) is in writing and signed by the grantor; (ii) unambiguously identifies the land; (iii) adequately identifies the parties; and (iv) evidences an intention to transfer the property. A deed to a dead person is VOID — it does not convey good title.

Estoppel by Deed (After-Acquired Title)

If a grantor purports to convey title they do not hold and later acquires it, title automatically passes to the original grantee. A subsequent BFP who had no notice (actual or constructive) of the original grantee takes free of the estoppel. If the original grantee properly recorded, the subsequent buyer has constructive notice and cannot be a BFP.

Easement Appurtenant

Benefits a dominant estate and automatically passes with the land, even if later deeds do not mention the easement.

Easement — Merger and Extinguishment

If the same person acquires both the dominant and servient estates, the easement is EXTINGUISHED by merger and does NOT automatically revive if one parcel is later conveyed to someone else. Recording does NOT keep an easement alive if merger applies.

Easement — Effect on Marketable Title

An easement renders title UNMARKETABLE as it diminishes the value of the land.

Marketable Title — Timing

In a land sale contract, the seller is NOT required to provide marketable title until the DATE SET FOR CLOSING. A buyer generally may not rescind before closing merely because the seller currently lacks marketable title, so long as the seller can convey marketable title at or by closing.

Mortgage — Priority Rules

Priority of a mortgage is determined by the time it was placed on the property. Foreclosure terminates interests JUNIOR to the mortgage being foreclosed but does NOT affect SENIOR interests. A junior mortgagee may pay off a senior lien in default to avoid being wiped out. Persons with interests subordinate to the foreclosing party are NECESSARY parties; failure to include them preserves their interest despite foreclosure.

Mortgage — Assumption by Grantee

When a grantee assumes the mortgage: grantee expressly promises to pay the mortgage; mortgagee becomes a TPB of that promise and can sue grantee directly; original grantor-mortgagor becomes a SURETY (secondarily liable if grantee fails to pay).

Mortgage — Modification of Senior Mortgage

A senior mortgage may be modified without losing priority UNLESS the modification materially prejudices the junior mortgagee by increasing the senior debt or otherwise reducing the junior mortgagee's security.

Mortgage — Equitable Right of Redemption

After foreclosure begins but BEFORE the foreclosure sale, the mortgagor has the right to redeem the property by paying off the amount due plus accrued interest. This right CANNOT be waived in the mortgage itself.

Mortgage — Statutory Right of Redemption

Some jurisdictions provide an additional right of redemption AFTER the foreclosure sale (set by statute). The prior mortgagor may pay a certain sum to redeem title within the statutory period. Arises only by statute.

Doctrine of Exoneration

When a testator dies and the will devises property subject to a mortgage for which the testator was personally liable, exoneration directs that the mortgage debt be paid from the RESIDUE of the estate.

Landlord — Covenant to Maintain Property After Sale

A landlord's promise in a lease to maintain the property does NOT terminate upon sale. Although no longer in privity of estate, the original landlord and tenant remain in PRIVITY OF CONTRACT → original landlord remains liable on the covenant unless there is a NOVATION (requires assent of all parties and completely releases the original party).

Restraints on Alienation — Strict Construction

Restraints on alienation are strictly construed. A covenant prohibiting ASSIGNMENT does NOT prohibit SUBLEASING, and vice versa.

Trade Fixtures Exception

Under a commercial lease, a tenant may remove items used in their trade or business (trade fixtures) that would otherwise become fixtures on the realty. Removal must occur BEFORE the end of the lease term unless removal would cause substantial damage (in which case, tenant must restore premises or pay restoration costs).

Battery

Requires: (a) an act bringing about harmful or offensive contact; (b) intent to bring about contact to plaintiff; and (c) causation. Under substantial certainty: actor knows with substantial certainty that consequences would likely result in harmful or offensive contact.

Self-Defense

A privilege raised when force is reasonably necessary to prevent death or serious bodily harm. Does NOT permit retaliation or revenge.

Use of Force to Protect Property

Permissible if reasonable to prevent or end a trespass to protect property. Force threatening serious bodily injury is prohibited unless the defender is in danger of serious bodily harm.

Duty (Child Standard)

A child is expected to conform to the conduct of a reasonably careful person of the same Age, Intelligence, and Experience (A.I.E.).

Standard of Care — Physical Disability

Standard of care adjusts for major physical disabilities (e.g., blindness). Physical conditions are taken into account as part of the 'same kind of person' (SKP) standard. Physical conditions = disability, not a mental condition.

IIED (Intentional Infliction of Emotional Distress)

Requires: (1) extreme and outrageous conduct by defendant; (2) intent or recklessness; (3) causation; and (4) damages via severe emotional distress.

Trespass to Chattels

Occurs when defendant intentionally interferes with plaintiff's use or possession of a chattel, including taking the chattel out of plaintiff's possession.

Conversion

An intentional act depriving plaintiff of possession of chattel, or interference so serious it deprives plaintiff of its use. Damages = Fair Market Value at the time of conversion.

Trespass to Land

Intentional intrusion upon land in possession of another. Private necessity = qualified privilege (no trespass liability but liable for damages). Public necessity = complete privilege (no liability for trespass or damages).

Privilege of Necessity

Raised when a trespasser uses a landowner's land to escape peril. Public necessity: protects community as a whole → absolute defense for trespass AND damages. Private necessity: protects own interest only if emergency is not of the trespasser's own making → defense for trespass only; defendant still liable for actual harm.

False Imprisonment

Confinement of plaintiff against their will. Even a brief inability to leave (e.g., having to force open a door) can constitute false imprisonment.

Res Ipsa Loquitur (RIL)

Establishes breach of duty if: (1) the event normally does not happen without negligence; and (2) plaintiff did not cause the event (or harm was caused by defendant's exclusive control).

Proximate Cause

If defendant is the DIRECT cause: result is foreseeable unless freakish and bizarre. If INDIRECT cause: defendant always liable for intervening medical negligence, negligent rescue, protection/reaction forces, and subsequent disease or accident. No liability if intervening force is a crime or intentional tort.

But-For Test (Cause in Fact)

Single defendant: 'But for' test. Multiple defendants: merged or mingled causes → substantial factor test; unascertainable cause → shift burden of proof to each defendant.

Intervening / Superseding Cause

A force taking effect AFTER defendant's negligence that contributes to plaintiff's injury. Foreseeable → NOT superseding; defendant remains liable. Unforeseeable → superseding → breaks causation chain → relieves defendant of liability. Dependent intervening forces (normal responses) are almost always foreseeable. Rescuers = foreseeable plaintiffs unless rescue done recklessly.

Punitive Damages

Generally NOT available in negligence actions. Available in intentional tort cases if defendant's conduct was outrageous or malicious. Available in negligence if defendant's conduct was wanton and willful, reckless, or malicious.

Compensatory Damages

Damages based on emotional distress and/or tampering with property.

Contributory Negligence / Assumption of Risk

Plaintiff may be denied recovery if they assumed the risk. Implied AOR: knowing a risk an average person would appreciate. Voluntary AOR: requires an available alternative.

Contributory Negligence

Plaintiff may NOT recover if he/she was negligent, UNLESS the defendant had the last clear chance to avoid the harm.

Pure Comparative Negligence

Plaintiff may recover damages minus the percentage of their own fault, even if plaintiff was more at fault than other parties.

Joint & Several Liability (Two Tortfeasors)

When two tortfeasors cause an indivisible injury, each is liable for the entire injury. Plaintiff may recover the full judgment from either defendant.

Joint and Several Liability

When 2+ tortious acts combine to proximately cause an indivisible injury, each tortfeasor is liable for the ENTIRE damage.

Contribution vs. Indemnity

Contribution: allows a tortfeasor who pays more than their fair share to recover the excess from others. Indemnity: shifts the ENTIRE loss to the party primarily responsible.

Defenses to Negligence — Summary

CONTRIBUTORY NEGLIGENCE (minority rule): negligent plaintiff is barred from recovery; last clear chance applies. ASSUMPTION OF RISK: plaintiff knew of risk and voluntarily proceeded. COMPARATIVE NEGLIGENCE: jury assigns percentage of fault. Pure comparative fault → strictly by the numbers. Partial/Modified → plaintiff recovers only if fault less than 50%; last clear chance does not apply.

Bystander Emotional Distress (NIED)

Bystander outside zone of danger may recover if: (i) plaintiff and injured person are closely related; (ii) plaintiff was present at the scene; (iii) plaintiff personally observed or perceived the event.

Violation of Statute — Excuse

Violation of a statute is excused when: (i) compliance would cause more danger than violation; or (ii) compliance is beyond defendant's control.

Alternative Liability / Unascertainable Cause (Summers v. Tice)

Applies when 2+ defendants were negligent but it cannot be determined which caused plaintiff's injury. Burden shifts to each negligent defendant to prove their negligence was NOT the factual cause.