Contracts: Key Concepts & Quick Reference

Federal, state, and international sources influence contracts: Restatement (Second) of Contracts, UCC (Uniform Commercial Code), federal statutes, and case law.
Restatements are authoritative summaries, not statutes. The UCC is statutory for transactions involving goods; restatements guide common law principles where statutes don’t apply.
Civil vs common law distinction matters for how rules are derived and applied.

Contract: a promise or set of promises for the breach of which the law gives a remedy or the performance of which the law recognizes a duty. $\text{Contract} = \text{promise or set of promises with a legal remedy/duty}$
Promise types: explicit promises; implied promises.
Elements often emphasized: offer, acceptance, mutuality (meeting of the minds), and consideration.
Remedies: economic damages, specific performance, promissory estoppel, restitution.
IRAC framework: Issue, Rule, Analysis, Conclusion (how lawyers structure answers).

Exchange theory: parties exchange value to improve their positions; voluntary and mutual.
Mutuality and genuine consent: no enforceable contract if there is coercion or lack of meeting of minds.
Consideration: something of value exchanged; required for most enforceable contracts.
Private law vs public law: contracts create private law obligations between the parties, but courts enforce them.
Sources interplay: when a contract is within the sale of goods, UCC controls; otherwise, common law (restatement) applies.

Goods: $\text{goods} = { \text{movable things} } \setminus { \text{money}, \text{investments}, \text{things in action} }\to$ includes most movable items (e.g., cars, bread, crops after harvest). $\text{Goods} = \text{movable things}$
Special cases: investment securities and money are not goods; real estate is not covered by the UCC.
Louisiana exclusion: UCC applies everywhere except Louisiana.
Merchants: a person who deals in goods of the kind or who holds themselves out as having knowledge or skill peculiar to the goods; special rules may apply to merchants (e.g., merchant-specific provisions in Article 2).
Hybrid transactions: when a contract involves both goods and services, courts decide which body of law applies using two tests.
Warranties under UCC: express and implied warranties may apply to goods; service contracts have different warranty considerations.

Predominant purpose test: which part of the transaction is the main objective; governs which law applies.
Gravamen of the complaint test: what most of the dispute concerns; sometimes both tests yield different answers.
Practical approach: identify both tests, discuss how each would apply given the facts, and pick the governing rule for the analysis.
Example: buying a car with a service plan may implicate both UCC (goods) and common law (services); the dominant purpose and gravamen determine which regime controls.

Capacity: lack of mental capacity or being a minor can render a contract unenforceable; intoxication is not a blanket defense.
Statute of Frauds: certain contracts require a writing (e.g., real estate sales); writing helps satisfy evidentiary and enforceability requirements.
Illegality and impossibility: contracts involving illegal conduct are unenforceable, even if there was offer and acceptance.
Private law impact: even if a contract is invalid, related transactions may create other remedies or exposures (torts, crimes, etc.).

Real estate transactions are typically governed by state real property law and statutes of frauds; UCC does not cover realty.
In Lucy v. Zeimer-like scenarios, a writing memorializes terms (e.g., price, title conditions) and can create enforceable rights; absence of writing may prevent enforcement under statute of frauds.

Facts involve negotiation over a farm ( Ferguson Farm ) with a written agreement signed by both parties and a dispute over whether there was a valid contract due to intoxication and a prior negotiation history.
Formation requires a bargain with mutual ascent (meeting of the minds). The Restatement §17 requires manifestation of mutual assent; the written memorial can reflect that assent.
Objective vs subjective intent: courts assess intent from outward conduct and writings, not only the internal beliefs of the parties.
Capacity and intoxication: intoxication is not automatically a defense unless proven that the party lacked capacity to contract.
Writing and the statute of frauds: a writing can satisfy the statute of frauds for real estate when it memorializes essential terms; prior negotiations and signed writing can evidence a contract.
Outcome emphasize: even in disputes involving drunken negotiation, a court may find mutual assent if the objective evidence supports it; the contract may be enforceable if the elements are met and the statute of frauds is satisfied.

First ask: what body of law applies? UCC (sale of goods) vs common law (restatement) vs mixed analysis.
For each fact pattern, identify: is the transaction a "sale of goods"? If yes, apply UCC; if not, apply common law.
In hybrids, apply the dominant purpose test or gravamen of the complaint test and justify using facts.
Issue spotting: watch for capacity, illegality, statute of frauds, and whether there is a writing required.
When drafting answers, structure with IRAC: Issue, Rule, Analysis, Conclusion; clearly articulate which rule applies and why.

UCC applies to the sale of goods; goods are movable except: $\text{money}, \text{investment securities}, \text{things in action}$
Real estate is not covered by the UCC; use state real property law and statute of frauds
Restatement (Second) of Contracts is a guide to common law of contracts; UCC governs goods where applicable
Two main tests for hybrid transactions: Predominant Purpose and Gravamen of the Complaint; apply to determine governing law
Merchant status matters for certain UCC provisions; UCC applies to all buyers and sellers of goods, but merchant-specific rules may apply when one or both parties are merchants
Capacity, consent, and legality are essential defenses to enforceability
Remedies include economic damages, specific performance, promissory estoppel, and restitution; punitive damages are generally not available in contract law
Final exams: typically two essay questions; time-limited; open-book in-person format; follow the law school honor code

Contract = $\text{promise or set of promises, breach leads to a remedy}$
Goods definition (UCC): $\text{goods} = {\text{movable things}} \setminus {\text{money}, \text{investment securities}, \text{things in action}}$
Hybrid questions require analysis under both regimes; conclude which regime governs for the dispute
Real estate requires writing under the statute of frauds; otherwise enforceability may fail
Capacity defenses require lack of mental ability or being a minor (emancipated may vary by state)
Private law in contracts may be relatively informal in writing, yet enforceable if elements are satisfied