themis contracts and sale

What is a contract

A legally enforceable agreement

What universe are we dealing with in regards to a contract that deals with services and real estates

Common law

What universe are we dealing with in regards to a contract that deals with goods

UCC

What is the all or nothing rule

You can not be in common law and UCC at the same time , one or the other

What is the exception of the all or nothing rule ?

Divisible contracts- the agreement is split into two mini contracts

What is the predominate purpose rule

When there's a mixed contract, we look to see whether a good or service plays a bigger role

What are the four main topics on contract formation

Agreement, Consideration, Defenses, and Statute of Frauds( All Contracts Don't Suck)

What 2 aspects are in a contract agreement

Offer and acceptance

What is an offer

A manifestation of a willingness to enter into an agreement (by the offeror) that creates a power of acceptance (in the offeree)

What test is offer and acceptance governed by

Objective test- outward appearance of words and action matter (not secret intentions)

True or false: you can accept an offer not directed at you

False: an offer must usually be directed at a specific offeree (exception- contest offers/rewards)

How specific do common law offers have to be ?

All essential terms must be included (Price, parties, subject and quantity)

How specific does UCC offers have to be ?

The only essential term is quantity; price doesn't have to be there

What is a requirement contract

Buyer doesn't know how much they will require but they agree to buy all that they require from the seller exclusively

What is an output contract

Contract where the seller guarantees to sell all of its output to one buyer, and the buyer agrees to accept the entire quantity

What is a preliminary communication that reserves the last right of approval with the speaker . It also doesn't give the power of acceptance to the other side

Invitation to deal

An ad is usually understood as what?

An invitation to deal unless it's a reward ad or a very specific ad

What are common ways to terminate an offer

1. Offeror revokes the offer by express communication to the offeree

2. Offeree learns that the offeror has taken an action that is inconsistent with a continued ability to contract

3.offeree makes a counteroffer

4. Offeror dies

5. A reasonable amount of time passes

What is a constructive revocation

Offeree learns that the offeror has taken an action that is absolutely inconsistent with a continuing ability to contract

True or false : an offer can be revived

True even if these exact terms were thrown out earlier

True or false: an Offeror is usually not able to revoke at any time before acceptance

False

What four ways can irrevocable offer arise?

1. Option

2. Firm offer

3. Unilateral contract

4. Detrimental reliance (promissory estoppel)

What is an option contract?

Gives 1 party the right to buy or sell something at some time in the future for a specific price

What is a firm offer?

Offer to buy a good Can't be revoked, provided for under UCC, up to 3 months

What are the requirements for a firm offer

Must be written

Signed by the offeror

Contain an explicit promise not to revoke

What is a unilateral contract

A unilateral offer to contract can't be revoked by the offeror if the offeree has started to perform

Bilateral Contract

promise for a promise

True or false: a unilateral contract can be accepted only by performance and therefore gives promise the right to finish

True

Is an offeree required to complete performance in an unilateral contract

No they can stop at any time

When does detrimental reliance (promissory estoppel)arise?

when an offeree reasonably and detrimentally relies on the offer in some foreseeable manner.

• a general contractor/subcontractor

What is acceptance?

Manifestation of a willingness to enter into an agreement by the offeree

What test is acceptance governed by?

Objective test

Under the modern approach , if there is ambiguity about whether the offer is unilateral or bilateral, acceptance can be by either _ or ___

Performance or return promise

How does the UCC treat when a seller sends the wrong goods to the buyer

It's an acceptance but it's also a breach

True or false: in open to all offers(like contests/rewards), you do not have to know of the offer to accept it

False, you must know about the offer and must normally communicate acceptance

What is the mailbox rule?

an acceptance is effective when the letter is sent

When does the mailbox rule not apply?

1) If the offeree sends something else back first (e.g., rejection, counteroffer);

2) To other types of communications (e.g., revocations, rejections);

3) To option contracts; or

4) It is unclear whether this applies to other media (e.g., fax, e-mail).

Acceptance by Silence

Generally, silence (or inaction) cannot constitute acceptance - even when the offeror indicates that silence or inaction will be taken as acceptance.

What are exceptions to the communication rule to the offeror

Unilateral rewards(lost cat)

Unilateral offer where offeror can see the performance has occurred

Past history of acceptance by silence

When the offer says acceptance must be silent and the offeree intends to accept by silence

What are implied in fact contracts

Contracts in which acceptance can be assumed from gestures or actions instead of writing or speaking

The universe uses the mirror image rule

Common law, the terms of the acceptance must match exactly the terms of the offer

A conditional acceptance is another form of what

Counteroffer

True or false : the UCC replaces the mirror image rule with section 2-207

True ; acceptance that does not match the terms of the offer exactly can still be a legal acceptance

A new term can be accepted into the contract if all of these are true :

1. Both parties are merchants

2. the new term does not materially alter the deal.

3. The initial offer did not expressly limit acceptance to its terms, and.

4. The offer does not reject or object within a reasonable time to the new term.

What is the knockout rule?

Under the knockout rule, the conflicting terms knock each other out of the contract, and the UCC will substitute a reasonable term in its place.

What is acceptance by conduct?

When parties fail to make a contract, but still act as though there is a contract. Under the UCC , only the terms that both writings agree on become part of the contract.

What is consideration?

The legal benefit received by one person or the legal detriment imposed on the other person.

True or false: gift promises, and conditional gifts count as bargained for consideration

False

True or false: a difference in economic value between the items exchange is grounds for finding an adequate consideration

Falls as long as there is enough value , consideration will be adequate

What is an illusory promise?

A promise that is so uncertain as to what the terms of the promise is that the promisor has not definitely promised to do anything. "I'll do it if I feel like it"

There must be a way for them to breach

Which contracts are not illusory

Satisfaction , output, and requirements contracts

True or false: Past consideration is not consideration

True

Settling a legal claim can be sufficient consideration, but only if:

1. The plaintiff has a good - faith belief in the validity of the claim ; or

2. There is reason to doubt validity of the claim due to uncertain law

True or false: contract modification might require new consideration in order to be valid

True this is known as the pre-existing duty rule

Common law follows, which rule:

Pre-existing duty rule

What are the exceptions to the common law pre-existing duty rule?

(1) change in performance

(2) Unforeseen difficulties that would excuse performance

(3) Third-party promise to pay

True or false: the UCC follows the pre-existing duty rule

False; the modification must only be in good faith to be binding

What is promissory estoppel?

When one party makes a promise, and the other party relies on that promise to take some action

What are 3 elements to promissory estoppel?

1. A promise is made that will be reasonably expected to induce reliance.

2. The promise does, indeed take detrimental, action and reliance on the promise and.

3. Injustice can only be avoided by enforcement of the promise.

Do charities have to prove detrimental reliance when pursuing a reliance theory to collect charitable gift promises

No

What is a quasi contract?

An obligation or contract imposed by law in the absence of an actual agreement to prevent unjust enrichment

What is a quasi contract elements?

1. The plaintiff confirms measurable benefit onto the defendant.

2. The plaintive reasonably expected to get paid, and.

3. It would be unfair to let the defendant keep the benefit without paying.

What are the seven defenses to contracts?

1. Misunderstanding.

2. Incapacity.

3. Mistake.

4. Fraud./misrepresentation/nondisclosure

5. Duress.

6. Illegality

7. Unconscionability.

When does misunderstanding arise?

When each party attaches a different meaning to the same words

What must you show for a misunderstanding defense?

1. The material term can be interpreted in 2 Different Ways

2. Each party attached is a different meaning to that term.