Contracts

common law

services/employment, sale of land/real estate, contruction

social contract

unenforceable

invitation to offer

intent to enter contract

preliminary agreements

not binding unless there is intent

ads

not offers, they are invitations to offer

lefkowitz v great minneapolis

where the offer is clear, definite, and explicit, and leaves nothing open for negotiation, it constitutes an offer, acceptance of which will complete the contract

formation of a contract

mutual assent and consideration

express terms

expressly manifested and communicated, oral or in writing

implied terms by law

obligation to perform in good faith

implied terms by fact

implied by conduct terms

implied terms

course of performance, course of dealing, usage of trade

offer

manifestation of willingness to enter into a bargain

offer criteria

communicated, clear and definite terms, intent to be bound

clear and definite terms

service, land, construction, reasonable amount of time/stipulated, price, parties

objective test

mutual assent ray v eurice

subjective test

meeting of the minds lonergan v scolnik

unilateral contract

promise for performance

i promise to pay you when/if…

offer is a promise, performance is acceptance

carlill v carbolic smoke ball

performance acts as acceptance of the offer and consideration

unilateral contract classic view

offeror could revoke prior to full performance and acceptance valid upon full perf

unilateral contract modern view

when performance starts, offeror loses right to revoke if

• offereee completes performance in a timely manner

• offeree performs in accordance with the offer

when you start to perform then fictional option is created

performance acts as consideration

rewards are automatically offers for unilateral contracts

bilateral contract

promise for promise

promise to sell for a promise to pay

offer and acceptance are both promises

performance will happen at some future moment

option contract

turns revocable contract into irrevocable

forebearance

always valid upon receipt

expressly stipulates you will keep it open

can i pay you this if you hold it for

revocation

can revoke until offer is accepted

effective when received by offeree

revocation terminated

rejection, counteroffer, expiration, deadline, death, subsequent illegality

conversation rule

offer lapses at end of conversation

acceptance elements

knowledge, intent, mirror image rule

bargain

a bargain in which there is a manifestation of mutual assent

mutual assent

bargain is manifested in an offer and acceptance. this is intent to contract

leonard v pepsico

exception to general rule that ads are invitations to offer, not offers lemselved

offer failed in definitness

specific performance

contract

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 reconizes as a duty

ray v eurice

meeting of the minds v mutual assent

subjective intent

meeting of the minds

actual intention of a party rather than conduct to determine legal obligation

what a party really honestly thinks and believes

objective intent

mutual assent

conduct of parties from perspective of a hypothetical reasonable person

determination or interpretation of a partys words or actions through the lens of the reasonable person

ray v eurice

the law is clear, absent fraud, duress or mutual mistake, that one having the capacity to understand a written doc who reads and signs it, or, without reading it is bound by his signature in law

requirement of an offer

be communicated

sufficiently certain and definite

manifest offerors intent to be bound to a contract

offeror is master of their offer

freedom to contract

create power of acceptance

enter into contract on their own terms

methods of terminating power of acceptance

rejection/counter offer

lapse of time

revocation

death/incapacity

rejection/counter offer

terminates offerees power of acceptance

new offer subject to acceptance

valid upon receipt

lapse of time

offer does not stay open forever

offeror can stipulate a time upon which an offer will expire

reasonable time to expire

conversation rule- offer during conversation lapses at end of convo

direct revocation

offeror must communicate direct revocation notice to offeree and revocation is effective when recieved by offerree

indirect revocation

communicated by third party

info is reliable

acceptance

expression of commitment (manifestation of intent to be bound by a contract)

must be unequivocal and unqualified

mirror image rule

restatements

accurate and authoritative summaries of the rules of common law in fields

restitution and promissory estoppel

a person can incur legal obligations to another even though they have not entered into consideration supported contract

ray v eurice

a contract may still be enforced even though one of the parties made a unilateral mistake in interpreting the agreement

mirror image rule

offeree acceptance needs to be exact as from the offeror

how offers end

acceptance, counteroffer, expired by passage of time, revocation, death, incapacitated

offeror is master of offer

freedom to contract and freedom from contract

option contract

promise to keep an offer open, promise binding on offereor

promise is enforceable only if the promisee has given a performance or another promise in exchange for it

lonergan v scolnick

a property owner who asks another person if he is interested in purchasing the property has not merely by asking made an offer to the other person

normile v miller

an offeree cannot enforce a contract to sell property if he did not accept the offer to sell until after the offer had been validly revoked

beginning of performance

is express or implied promise to complete performance

cook v coldwell

a unilateral contract is enforceable when a promisee has engaged in substantial performance under the contract

sateriale v reynolds

an ad constitutes an offer when the advertiser, in clear and positive terms, promised to render performance in exchange for something, and the recipient of the ad reasonably might have concluded that by acting in accordance with the request a contract would be formed

agree to agree

agree to a bunch of terms but dont agree to some, will do further down the road

postponed bargaining

many cases, a contract may be clearly incomplete, may not contain express terms governing various potentially important aspects of the parties relationship

UCC s 2-305

The parties if they so intend can conclude a contract for sale even though the price is not settled. In such a case, the price is a reasonable price at time of delivery if nothing is said as to price or the price is left to be assigned by the parties and they fail to agree or price is to be fixed in terms of some agreed market or other standard as set or recorded by a 3rd person or agency and it is not so set or recorded. A price is to be fixed by the seller or by the buyer means a price for him to fix in good faith.

walker v kieth

to be enforceable and valid, a contract to enter into a future covenant must specify all materia land essential terms and leave nothing to be agreed upon as a result of future negotiations

quake v american airlines

a letter of intent to enter into a contract will be enforceable if the parties intended the letter to be contractually binding

consideration- benefit detriment

need benefit to promisor or detriment to promisee

consideration

to constitute consideration, a performance or a return promise must be bargained for

a performance or return promise is bargained for if it is sought by promisor in exchange for his promise and is given by the promisee in exchange for that promise

performance

performance or return promise may be given to the promisor or to some other person. it may be given by the promisee or by some other person

performance for consideration

an act other than a promise

forbearance

creation, modification, or destruction of legal relation

there is consideration

anytime a comercial contract has money or value attached

consideration vs conditional gift

if action/conduct benefits promisor more likely to be consideration

quid pro quo, inducement

adequacy of consideration

courts are not concerned with adequacy

consideration classic view

courts dont inquire into adequcy of consideration

no need for equivalency between price and value

moder view consideration

can show consideration was a sham, that both parties knew it and deliberately disguised what was really a gift to look like a bargain, then there may be an argument

past consideration

something that happened before a promise cannot be considered for that promise

you cannot bargain for someone to do something that has already been done

if a party is legally required to do something, then agreeing to do that thing is not consideration

moral consideration

the desire to do the right thing is not enough

there is no such thing as moral consideration

illusory promise

a promise that appears on its face to be so insubstantial as to impose no obligation on the promisor, a promise in form but not in substance

where the promising party has reserved unbridled discretion over their performance

a promise based on conditions that cannot occur

when a real promise is exchanged for an illusory promise, neither is enforceable

not a real promise

real promise lacks consideration

agency law

one person manifests assent to another person

agent shall act on the principles behalf

subject to the principles control

agent manifests assent or otherwise consents so to act

actual authority, apparent authority, ratification, estoppel

UCC

simplify, clarify, and modernize the law governing commercial transactions

permit the continued expansion of commercial practiced through custom, usage, and agreement of the parties

make uniform the law among various jurisdictions

goods

all things moveable at the time of identification to the contract for sale other than the money in which the price is to be paid