Recording-2025-03-05 LAW-240 CH 11

Overview of Contract Law

• Understanding contract law is essential for determining the enforceability of agreements made between parties.

Example Case: Inquiry Maitre D's Situation

• Scenario involves a restaurant reservation with specific terms: customers must refrain from using phones.

• An engagement takes place at the restaurant; a patron violates the agreement by using their phone.

• The core question arises: Are they obligated to pay for their meal due to the breach of contract?

Nature of Contracts

• Not all promises form legally enforceable contracts; only those meeting legal specifications are enforceable.

• Important to differentiate between everyday promises and legally binding agreements.

Key Characteristics of a Legally Enforceable Contract

1. Agreement: Comprises both an offer and acceptance.

2. Consideration: Each party must provide something of value.

3. Capacity: Parties must have legal competence to enter contracts.

4. Consent: Free from coercion or undue pressure.

5. Legal Purpose: The contract must be for a lawful objective.

Promises vs. Enforceable Contracts

• Examples of non-enforceable promises:

  • Casual commitments among friends (e.g., "I'll be there in five minutes").

  • Lack of intention to be legally bound.

• Illustrative cases in class focused on various types of agreements, such as those between classmates and social contexts.

Discussion and Class Engagement

• Interactive session with students to discuss their understanding of contracts.

• Example invoking humor with prom proposal to engage students and illustrate personal contracts.

Different Types of Contracts

• Bilateral Contracts: Mutual promises exchanged (both parties have obligations).

• Unilateral Contracts: A promise that requires a specific act to complete it (e.g., a reward for a lost dog).

Understanding Contract Validity

• A contract is valid if it fulfills all legal requirements:

  • Parties must consent to legal acts.

  • Must offer consideration that is legally recognized.

• Unenforceable Agreements: Cannot be enforced in court due to lack of consideration or legal concerns.

• Express Contracts: Terms explicitly stated and agreed upon.

• Implied Contracts: Formed through actions rather than written terms.

Special Contract Concepts

1. Promissory Estoppel: Protects a party when they rely on a non-enforceable promise to their detriment.

   • Example: Planning for prom based on someone’s invitation.

2. Quasi-Contract: Created to prevent unjust enrichment when one party benefits at another's expense without a formal contract.

   • Example: A person's house being painted without consent when there was no agreement to do so.

UCC and Sale of Goods

• The Uniform Commercial Code (UCC) governs commercial transactions across states.

• Article Two of the UCC specifically addresses the sale of goods (tangible items you can touch and move).

• Distinction between goods and services is critical in contract law.

• Goods defined as physical objects, whereas services are actions performed for a benefit.

Summary of Important Points

• Non-Competition Agreements: Limited use; legality varies by state.

• Contract Characteristics: Valid contracts involve parties with capacity, clear consent, and legal purpose.

• Common Law vs. UCC Application: Determine the governing law based on whether goods or services predominate in an agreement.

Conclusion

• Understanding contracts involves recognizing definitions, types, elements of enforceability, and the difference between promises that are merely social and those that hold legal weight.