Contracts_Barbri_Outline-Video.doc

7/25/2019 Contracts_Barbri_Outline-Video.doc

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Contracts Law BarBri Outline

7 major contracts questions

Is there a deal? Was a deal or agreement made? If there is a deal, how do courts enforce deals?

Assuming there is a deal, is there any reason for the court not to enforce that deal? What is the deal exactly? What was agreed to?(ea. side has their own version of the

deal) Once we know what deal is, did anyone not do what he agreed to do? If someone didnt do what he agreed to do, did he have an excuse? !oes anyone other than the two guys who made the deal, have legal rights "#c of the

deal?

Definitions

$. %ontract & legally enforcea"le agreement'. exress contract & ver"al"ased solely on words*. imlied contract & "ased at least in art on conduct, arties acting as though they have a

deal +nilateral contracts are usually ($) rewards or contests (such as - for finding my

lost dog /luffy) or (') offer exressly re0uires erformance1. 2uasi contract & e0uita"le remedy (tells you that it is not contract law and rules of contract

law have no alication at all) 3ince it is e0uita"le remedy, and e0uity is a"out doing what is fair If it seems unfair to aly contract law on a 0uestion, add a aragrah discussing

0uasi 4-. +nilateral contract & contract results from offer that re0uires erformance to accet5. 6ilateral contract & contract results from an offer that is oen as to how it can "e acceted

Offeror doesnt re0uire secific way to "e acceted It is "ilateral world

7. executory & means that it has not yet "een erformed

what is contract law? case lawwhat courts say the law is 8estatement of %ontracts9 secondary source (treatise)the view of "unch of smart

eole a"out what law is or should "e %ourts are not o"ligated to follow thisit is not "inding on courts 8estates what common law rules are Article 2 of UCC9 some contracts are governed "y this' "asic 0uestions

o When do I do article '? It will never say use article ' :ust "e sale of goodsto use this article (never services)

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;oods


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Offer & need manifestation of a commitment through words or conduct.Cxam key9 they will give information a"out what offeror intended "ut this is a red herring "#cnot looking at intentions "ut manifestations.

%ommitment can "e manifested through an individuals words and actions indicating awillingness to "e "ound

always include hrase Dmanifestation of mutual assentE on 0uestions a"out formation. Offeror9 erson who makes offer Offeree9 erson to whom offer is made offeror revokes offer offeree reBects offer

hings to watch for ook for contentto see if is an offer

o erms Dfor immediate accetanceEF language suggest commitmento /act attern will give you what communication says

ook for missing termssee if communication seems incomlete here is no longer re0uirement that communication contain all of the

material termsthere can "e gas and still "e manifestation of commitment ook for missing rice ro"lemwill see this in context of communication

relating to roosed sale +nder common law rice term and descrition of real estate are essential or

there is no manifestation of commitment Article 'communication can"e an offer even though there is a missing

rice termo Also look for an am"iguous term DfairE Dreasona"leE DaroriateEF indicate no

commitment :issing v. am"iguous rule

:issing terms9 erson was willing to make commitment and leave it tocourt to fill inF >erson wasnt insisting on that term

Am"iguousF courts will conclude it was not a commitment and no deal

$. Ad,ertisements& Advertisements are not offersthey are invitations to the shoer tomake an offer. A store sign that says D3hirts $E is not an advertisement. he sign invites

the shoer to take the shirt to the counter, offer $, an offer that is acceted "y thecashier ringing u the sale. ;ives the store the right to refuse to sell to a customer.

excetions focus on whether ad is secific a"out how many ads are availa"le anda"out who can accet the ad

'. -issing +rice erm& Whether a contract that is missing a rice term is an offer deends onwhether the +%% or common law governs the interchange

%ommon law & not offer, must include the material term+%% & can "e offer if the arties intended it to "e so

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*. Am(iguous -aterial erms& In this case the term is there, "ut it is am"iguous, or vague.Geither the +%% nor % considers this an offer. he material terms cannot "e vague andstill "e considered an offer.

Am(iguit.

%ontracts must "e sufficiently clear to "e legally enforcea"le. 8affles v. Wifflehaus isthe rime examle of am"iguous terms. he contract is for cotton to "e shied on the "oat>eerless. he ro"lem was that there were ' sailings of the shi >eerless. Cach of the artieshad different sailings in mind, and the court could not esta"lish an agreement for the arties.It was fatal am"iguity.

$. am"iguous term in contract'. each arty must have different meaning in mind*. neither arty knows or has reason to know of meaning attached "y the other

If 6 knew that there were ' sailings, it takes the case out of the 8affles realm. he situation isthen legally enforcea"le under the terms as understood "y the other arty.

1. *equirements Contracts & =ere the measure of the 0uantity of goods to "e urchased "ythe "uyer is determined "y the "uyers needs. /or examle, you make a deal with a localsulier saying that Ill "uy all of my wine from youexclusivity agreement. In this case the0uantity is not vague or am"iguous and the offer is therefore ,alid.

If you increase your re0uirements under this tye of agreement, it cannot "eunreasona"ly disroortionate. If you "uy $ "ottles for the first $ months, you

cant increase your demand to $ "ottles for the last two. hat is considered to "eunreasona"ly disroortionate you have to match what he asked for reviously towhat he asked for today.

o Is there a ceiling? @C3, unreasona"ly disroortionateo Increase must "e roortionate to other demands

Conte/twhat is the setting?o Watch for the "argaining historyhistory of negotiationsF that adds to

argument that it is a manifestation of commitmento Watch for advertisementsF generally ads are not offers "ut invitations to

make an offer.

Once the offer is found, check to see if it has "een terminatedermination & once an offer is terminated, its gone forever.

-E0ODS O) E*-!"A!O"

$. ase of ime & the offer is oen only so long as is secified "y its terms, if not time is notincluded the offer is oen for a reasona"le eriod of time

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ook at when offer was made =ow long a ga was there "efore offer was resonded to?

'. !eath of either arty & offer is terminated if not comleted "efore either arty dies Offer dies with erson a ga was there "efore offer was resonded to

*. 8evocation of offer$) Offeror uts offer on ta"le and changes his mind and takes it "ack') =ow does contract terminate? & if the offeror later changes her mind and decides not to

enter into deal, whether the offer can "e revoked deends on the offeree. he offermust "e revoked "efore the offeree accets it. he offeree must also "e aware of therevocation. 3haron 3tone in the shower examle.

ooking for words or conduct of offeror that was communicated to the offeree 8evocation is two layer game Cssential offeree "e aware of it

*) When does a revocation "ecome effective? Its all a"out the timingi. must comlete revocation "efore accetance occurs

ii. if revocation is sent through the mail, its not effective until its received1) When it is imossi"le to revoke? 3ome offers cannot "e revoked, and offeror is held to

the offeri. O'tioncontract & If I offer to sell my caddy to you for 1 and you ay me '-

to hold the deal oen, I cannot revoke that offer. If there is consideration aidfor a romise to kee an otion oen it cannot "e revoked.

ii. Offer reasona(l. and foreseea(l. relied u'on& offer cannot "e taken "ack. If Huses @s "id to "id on a contract and wins that contract, H has relied on @s "id andcan "e held to the offer.

6idavingit is irrevoca"le "#c reliance aimes 6airdreliance does not make offer irrevoca"le

iii. +art 'erformance of an offer to enter into unilateral contract& unilateralcontracts re0uire erformance for accetance of a contract. Once a unilaterallycontracted arty "egins starts erformance, the offeror can no longer revoke theoffer. =owever if all the arty has done is "uy aint in rearation to erform,there has "een no artial erformance and the offeror can revoke the offer. +se0uasiFcontract law to recover for money sent on reliance of the contract.

3tart of erformance ursuant to offer to enter into unilateral contract /act attern9 this offer can only "e acceted "y erformance


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3ale of goods and writing signed "y a merchant that not only romises to"uy or sell, this writing must exressly romise that offer will not "erevoked:+3 =AJC A O/ =C3C CHA%@

* month ceiling to itonly imt. when writing says it will kee it oen for5 months

o even if writing says it is irrevoca"le for $ year, still only oen for* months

1. 8eBection & if the offeree turns offer down, the offer is terminated. %ere are t%ree forms of indirect rejections$

$) %ounteroffer & offer is killed. Offer for 1 with the rely DIll only give you '.Ehis is a reBection and takes the offer comletely off of the ta"le. here is a fuKKy factline "etween a counter offer and "argaining. A "argain would consist of the followingrely to the 1 offer DWill you take '?E 6y asking you are clearly "argaining andthe offer is still there. It shows that you understand the difference "etween

counteroffers and "argaining.') %onditional accetance & DI accet, if ...E is a reBection.

Go mutual assent his is changing the deal so you are killing the deal Cxcetionimlied contracts /act attern where words dont connect u

*) I accet, and... & whether an offer is acceted with the addition of additional termsdeends on whether you are dealing with the +%% or %

Additional terms rulecommon law rule only I accet and is a reBection 3omething new is added I accet if#rovidedLno exress contract common law or +%% !ifferent from I accet andLnot insisting on this term "ut throwing it out as

roosalo In common law, still no exress contracto Accetance cant add anything to offermirror image rule

i. % & :irror image rule re0uires that the accetance look Bust like the offerii. UCC 12237& he 6attle of the /orms allows additional terms so long as they are

merely added and not insisted uon. o insist makes it a conditional accetance,which is actually a reBection.

:ost often +%% code tested 3ale of goods where communications dont match u

iii. =yo & if offer falls under +%% M'F'7 and the accetance attaches additionalterms. here is an offer and an accetance, "ut which one governs the deal? heoffer says H and the accetance says HN@. Which one is "inding? hatdetermination deends on whether "oth eole are "usiness eole, whether new

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terms materially alter the deal, whether the new terms were o"Bected. If the newterms were o"Bected to and they did create a material difference, there is still anaccetance and the terms that govern the deal are those in the original offer.

!id other guy agree to deal? *rdart to 0uestion $ook at fact attern and it will go in terms of two ossi"le issues of accetance

ook at who is acceting =ow they are acceting

Acce'tance& once the offer has "een made and theres no ro"lem with reBection, you mustthen look to the accetance.

1 /act atterns regarding accetance to watch for :ail"ox rulewhere arties are contracting from distance

o Adams v. indsell What has haened is the offer is made, and then in resonse to offer, erson to whom

offer was made, starts erformanceo 3tart of erformance is accetance is viewed as imlied romise to erform so it is

enough to make dealo ;ives us manifestation of mutual assent

Where offer re0uires erformance to accetthis does not create a"ilateral contract

Gotice of accetance' rules to alyo Accetance "y romise has to "e communicated to offeroro Accetance "y erformancewhether facts are such that the erson would

reasona"ly know you have erformed :ust give notice when other arty wouldnt know that you have started

erforming 3ale of goods 0uestionwhere facts are that "uyer offers to "uy goods and seller sends

the wrong stuff' conse0uenceso hat creates a dealsending wrong stuff is accetanceo %an now sue for "reacho Accommodation excetionsends wrong stuff with exlanation

!oesnt create contract, simly a counteroffer

$. Who acceted the offer$) :ust "e erson to whom offer is made. he offer is erson secific.') Offers are not assigna"le*) Geed manifestation of ersonal assentonly assented to sell to secific erson1) In rewards and contests, the offeree must know of the offer at the time he accets. =e

must know of the award when he catches the dog

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'. =ow accetance occursofferor can control how accetance haens$) 8eturn romise & most offers can "e acceted "y merely a romise') 3tart of erformance only & if you start erformance, have you acceted the offer? @ou

have to look at the nature of the offer. If the offer is a unilateral one acceted only "yerformance, artial erformance does not constitute an accetance. If the offerorrevokes the offer after artial erformance, you are under no o"ligation to finish theerformance. In the case of unilateral contracts, full erformance is re0uired foraccetance. =owever, once you "egin erformance the offer "ecomes irrevoca"le. Ifthe offer doesnt say anything a"out the method of accetance, a "ilateral contract, thenstarting erformance is an accetance and creates the contract. If the offer is made,the work is started, "ut is not comleted, look to the nature of the offer to determinewhether offer had "een acceted.i. +ni & start, irrevoca"le, can walk away, not actual accetance, can only "e acceted

"y erformanceii. 6i & start is accetance, duty to comlete, can "e acceted in any way

>resumtion is it is "ilateral +nless exressly re0uired erformance, it is "ilateral

+nilateral#"ilateral not used today

*. :ail"ox rule & only alies to accetance. Where reasona"le to resond to offer "y mail,fax, or /edCx and resonse is so done, the accetance dates from the time the accetanceis sent, the time laced in mail"ox. his concet is usually tested with a revocation of theoffer.Cxamle & I offer to sell you my %addy for 1 via mail. On uesday I change my mind and

mail you another letter revoking the offer. he letter of revocation doesnt arrive until/riday. (he revocation is only good once it is received, unlike the accetance that is goodonce it enters the mail"ox.) If you mail a letter of accetance on Wednesday, whenaccetance is good when osted, what haens when you receive the revocation? he offerwas not terminated so long as the right erson acceted it. @ou dont have a contract, "ut itis legally enforcea"le.

QUES!O" 24%ow do courts enforce deals&

3ecific erformancecourt will order erson to do what erson agreed to do his is e0uita"le remedymust say this Only alied where money damages are inade0uate 8eal estate deals fall under this category 3ale of goods only when dealing with uni0ue goods (art, anti0ue or custom made) Gever do it in services or emloyment contracts Gegative secific erformancewhere someone has agreed to work with you and

"reached the contract

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o %ant force them to work for youo %an get negative secific erformance "y reventing them from working for

cometitors

:oney damagesmost exam 0uestions >unitive damagesnever for "reach of contract i0uidated damagesthis is hrase that descri"es contract rovision that tries to fix or

set the way of fixing damageso ;eneral rule is that li0uidated damages are recogniKedvalid way of fixing

damageso Cxcetionarties cannot "y agreement set out an amount of damages that would

"e enaltyo Issue will always "e is this li0uidated damages clause some kind of disguise for

enalty E/'ectation damagesgeneral standard for damages

o rying to make the world same as it would have "een had contract "een erformedo udicial efforto * stes

ask yourself, what would now have if the contract had "een erformed? What does actually have? What does it take to get her from ' to $ (from what actually have to what

suosed to have)?o =awkins v. :cgeedoctor romised erfect hand

What is value of erfect hand? What is value of gross hand received?o 5 limitations on e/'ectation damages

rule with resect to avoida"le damagesthey are not recovera"le ' different fact atterns that raise avoida"le damages

o fact attern $9 an agreement followed "y a "reach, followed "ycontinuing erformance "y non "reaching arty

must mitigate damages

watch for following two things was there clear "reach? or was it am"iguous? Is this a situation in which it can "e fairly argued

that continuing to erform decreases the damagesrather than increases them?

o fact attern '9 emloyment contract argument that couldve gotten comara"le Bo" Budgment call whether comara"le or not 3hirley :ac%laine case Got taking comara"le Bo" to reduce damages

8ule of conse0uential damages

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8ule is that they are recovera"le only if foreseea"le (in

contemlation) "y "oth arties at time of contract

=adley v. 6axendale9 mill in small village where mill "reakso %ontract to transort milling machineryo ransorting comany took far too long and they agree they

"reached the dealo :ill had to "e closed "#c of them taking so longo Got reasona"ly foreseea"le "y "oth arties here

%onse0uential damages are where is saying "#c you "reachedcontract with me, something else "ad haenedsecial damageswhich dont arise in every situation

Cconomic waste >eevinghouse and ;roves v. ohn Wunder

o contracts involving work done on lando unrestored land has same market value as restored lando assume that deal was that land will "e comletely restored and

araisers say that if it was comletely restored it will "eworth $,FFif not restored, only worth P,

o contract is "reached and land is not restoredo will argue that it will cost 7-, to restore my land now

QUES!O" 54an. reason not to enforce t%e deal&

W=O :A!C !CA?did Q have caacity? !oes he have legal right to disaffirm

Ca'acit.

Agreement is not enforcea"le if arty lacks caacityo >erson under age of maBorityo Intoxicationo :ental incometence

:ust mention DdisaffirmE in this tye of 0uestiono A"ility to get out of agreements that he has madeo With infancy, only re0uirement is age

' exam excetions to caacity rule imlied affirmationenter into agreement when $7 years old

o that erson continues to retain "enefits of agreemento "y continuing to retain "enefits of contract after gaining

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necessarieso most common test 0uestiono food, clothing, shelter, health careo situation where $7 year old rents aartmento even though lacks caacity, if necessary, legally o"ligated to ayo not contract o"ligation though0uasi 4 o"ligationo not agreed to ay agreed uon amount "ut fair and aroriate

amount

'.' 6 Ca'acit.

Cach of the agreeing arties must have caacity. he following grou of ersons are not heldcaa"le of "eing held to contracts9

# Infants (under $P) one fact rule2 :ental incometents one fact rule5 Intoxicated two fact rule

$. intoxication'. significance of ersons need to know of it

here is a secific rule for necessaries. We want everyone to "e a"le to get what theyneed to survive, so we do re0uire those ersons lacking cometence to ay fornecessaries. he agreement to rovide an infant, mental incometent, drunk with anecessary is not a contract (they do not have the caacity to contract) "ut a 0uasiFcontract. he only thing that can "e recovered from this grou of individuals is the value

of the erformance to that erson and not necessarily the contract rice. Whicherson? he contractor or the incometent?

=OW WA3 !CA :A!C? look for following Duressnot Bust hysical duress "ut economic duress too

o ooking for ' things in economic duress Imroer threat "y did erson who is trying to enforce deal do

something imroer Qis he left with any reasona"le alternative?

Imroer threat standardo Watch for ' fact atterns

/act attern R$9 involving changing the dealmodification in contracts ook at litigation settlement where settled for less than she had

reviously acknowledged that she would Undue influence

o +nfair threat not imroermilder standard for o ook at Qtougher standardmust "e under domination of

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o :ust talk a"out duress and undue influenceo ooking for ro" with how deal was doneo ook at Q and see if he was under the domination of o ooking at a weaker Qo %ula"ility is harder on in duress

-isre'resentation

o When only reason deal was made was "#c of misreresentationo ooking that I understand contract law concet of misre and tort law concet

ortlooking for negligence or intent %ontractdont need to show intentional or careless

:ust show misre, that it was material and that it was relied on -ista8e

o ;uys who made deal didnt understand surrounding factso Got language of deal "ut surrounding factso 3herwood v. Walker

8ose the cow who "oth owner and "uyer thought was "arren Where there is mutual mistake, a"out a D"asic material factE then deal is not

enforcea"le o trigger this rule, need mistake that is "asic and material

If mistake a"out what something is (the nature of what it is) thenthis 0ualifies

If mistake a"out what it is worth, that is never materialSS Gever ground for not enforcing deal

-ista8es of )act

3herwood v. Walker is a rime examle of a mutual mistake of fact. he case involved the saleof a cow "elieved to "e "arren, "ut wound u "eing fertile and with calf. he court determinedthat there was no contract, "ecause the contract was for a "arren cow that did not exist.When the arties make a mistake a"out a material fact, there is no contract.

Its not enough Bust to have a mutual mistake. here must "e a mutual mistake ofmaterial fact. Jalue is not considered a material fact.Cxamle & Im selling you a ainting that we "oth "elieve to "e an authentic Warhol. If it turnsout that it is not, that is a material fact that would invalidate the contract. If I am selling you

a Warhol that we "elieve is worth $4 "ut winds u only "eing worth $4, that is a 0uestion ofvalue and is not considered a material fact.

:utual :istake & the contract can "e rescinded+nilateral :istake & is not a "asis or defense for contract formation

Cxcetion & if it is an o"vious mistake where the other side knows or has reason toknow of the others mistake, they cannot take advantage of them.

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hings to ook forOffer, manifestation of commitment

8evocation & know how offers are revoked

999Unconsciona(ilit.

always decided "y Budge "ut fact driven Geed to know where it comes from

o +%% 'F*'9 Williams v. Walker homassince that case it is common law tooo Gow ucc and common#case law

What the ' issues are that we need to discusso =ow the deal was made?

rocedural unconsciona"ility whether terms were hidden or clearly exressed get into "argaining laws flaws in "argaining rocessdisarity of "argaining ower or surrise

in terms su"stantive unconsciona"ility

Doressive termsE ro"lems with the terms themselves

Unconsciona(ilit.

his concet was introduced with the +%%, "ut now it is generally included in allcontracts, including those covered "y common law.-ajor +oints

# %ourt can refuse all or art of agreement "ecause the terms are oressive or resented ina way that they unfairly surrised the other arty

2 Whether terms are oressive is tested as of the time the contract was entered into. hisis imortant in longFterm contracts. What was reasona"le ' years ago may not "ereasona"le today (otion to "uy)

5 Issues of unconsciona"ility always go to the Budge. hey are 0uestions of law.

CO"S!DE*A!O"

In order for a contract to "e valid, there must "e consideration or considerationsu"stitute.

Legal Detriment& the romisee must show that he suffered some "argained for legaldetriment. !etriment entails doing something, romising something, romising to for"ear orrefraining from doing something there is a legal right to do.

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DIf you come "y my house I will give you my %addy.E If I am trying to get you to come over tomy house as my o"Bective, and nothing else worked (such as listen to music, come over fordinner, drinks), then my giving you my %addy is a "argained for detriment. If I Bust want to givethe car away, and you Bust haened to "e walking "y at the time I wanted to do so, thats a"enevolent gift that is not enforcea"le.

DIf you sto listening to 6arry :anilow Ill ay you $.E hat is a "argained for detriment"ecause you have a legal right to listen to 6arry :anilow, and if you give u that right thenthere is legal detriment. =amer v. 3idway: ste' a''roac% to consideration

$. what is romise in 0uestion?

o >romise that is in disute is one to focus on'. Identify romisor and romisee

o >romisor Q who made the romiseo >romisee

*. What was the romisor asking for in exchange for the romise? What "argaining for in

exchange?

o %oncet of consideration is a concet of exchangeo Will "e asking for $ of 1 things in exchange

>erformanceto wash car for examle >romise to erform /or"earanceWilly my "oy

o >erson who made romise must "e asking for something in returno Willie my "oyif "argaining for return romise and erson does not erform then

no consideration1. Is there some new "enefit or detriment?

o hing she was "argaining for, was it "enefit to romisor and detriment toromisee?

o Geed "enefit to romisor and detriment to romiseeo * situations where issue of detriment needs to "e discussed in answering 0uestion

'ast consideration

cant "argain for anything already done must have "argain for new "enefit and detriment here is no such thing as ast consideration. >ast consideration is no

consideration at all. (;enerally) If you are grateful for someonesaving your life and you romise to ay them $, this is not a legallyenforcea"le romise. here is no consideration for the romise. @oucannot "argain for something that you have already done. Anagreement is not the same thing as a contract. hings must haen"efore an agreement

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+ree/isting legal dut.

!oing something you are already legally o"ligated to do is notconsideration for romise to ay you more money to do it

here is no legal detriment in doing something that you are alreadyo"ligated to do. here is no >C!8 in the +%%.

E/am'le& When sorts stars renegotiate their contracts, there isusually a different term of years in the new contract. If there were* years left in the original contract, the renegotiated contract would"e for 1 years. Otherwise, the contract would "e su"Bect to the reFexisting legal duty rule.

Amount of consideration is not discussedeercorns will suffice +art 'a.ment on de(t

2uestion is usually o"tuse as to what the ro"lem is >romise in 0uestion will often "e the creditor romising to release the

rest of the claim >art ayment of a de"t that is due and undisuted, is not

consideration for a release 3ince you have legal o"ligation already for the whole amount, it is no

new detriment to me to ay smaller amount

CO"S!DE*A!O" SUBS!UES45 of t%em

+romissor. Esto''el(R$) 5 ste aroach

$. what is the romise in 0uestion

'. la"el romisor and romisee*. what did romisee do after romise was made? what was reliance?1. was this thing, action or inaction, that romisee did, was it induced or caused "y, did it

haen "#c of romise? ells you whether you are doing consideration or romissory estoel Go one has asked romisee to do what she is doingshe is doing "#c of the romise Cx. I hold the mortgage on your house. I romise I will not foreclose your

mortgage for - years. (romise in 0uestion)a. I try to foreclose anyway. 6ut after you have ainted house. here is no

consideration for my romise, "ut under romissory estoel it may "e.". Is it legally enforcea"le?

i. I wasnt asking for anything, simly making romise not to foreclosec. In Willy, if uncle Bust romised money for "eing a good erson and Willy

chose to refrain from smokingthat wasnt asked for After romise, romisee does something that was caused "y the romise "ut not

asked for (like refraining from smoke-. 3hould guy who made romise anticiated this action? was it reasona"ly foreseea"le?

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3hould mortgage holder have anticiated that mortgagee would aint house?5. Would it "e unBust not to enforce this romise?

>romissory estoel#; /our elements of >C

$. romise'. reasona"ly relied on to the actors detriment*. only way to avoid inBustice

-O*AL OBL!


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d. If I hire you to erform at my wedding on uly $, '', the contract cannot "eerformed within one year and is su"Bect to 3O/.

$. full erformance "y either arty satisfies the 3O/, it rovides needed roof thatthis was what the agreement was

'. art erformance does not satisfy 3O/, "ut you can "e 0uick to add 0uasiFcontractclaims

2; ransfers of interest in real estate &If the interest in real estate is for one year orless, the contract does not fall within the 3O/. /or examle a $'Fmonth lease wouldnot fall under the 3O/, "ut a lease for $*Fmonths would.

8egardless of dollar amount 4ey is that it has to "e real estate interest that has a term of duration of more

than a year6 orally agrees to "uy 6lackacre from 3. >art erformance can satisfy the 3O/ inreal estate dealings if two or more of the following occur9

a. artial ayment "y the "uyer

". ossession "y the "uyerc. imrovements made "y the "uyer

5; 3ale of goods of - or more (+%% M'F'$) Article ' alies regardless of if you are a merchant and dollar amount does not

aly3ecially manufactured goods & for goods that are custom made the start oferformance satisfies the 3O/

Ordinary goods & artial erformance of a contract for the sale of goodssatisfies the 3O/, "ut only to the extent of artial erformance. Cxamle &

you contract to sell me $ widgets for $. @ou deliver 1 widgets. @oucan recover for the 1 widgets "ecause you artially erformed. 6ut the dealwas for $ widgets, what a"out the other 5? I cannot recover those, "ut Imust ay for the 1 delivered. (what if there was reliance on the entire $"eing delivered? If you dont have them all its not worth having any, is thereanything that can "e done in that instance?)

2 =ow do you satisfy the 3O/?/ull erformance is a way of satisfying that there was an agreement and you followed

through with its terms ook at what 0uestion tells you a"out what writing says

Got enough that there is a writingthere are re0uirements for writing In order for writing to satisfy statute of frauds, all material terms must "e in writing

(not for sale of goods "#c that is +%%)o /rom the writing alone you can tell

Who the contracting arties are What did each agree to do

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If sale of goods, all the writing must say is 0uantity !oesnt have to name arties

o ook at who signed the writing unless it is sale of goods 0uestion which would "e +%% In order to satisfy statute of frauds it mustve "een signed "y Qif common law +%% secial rule for sale of goods of - or more there is situation under 'F'$ in

which all that is needed is signing "y his would haen when "oth are merchants and Q received notice of the

contract and never answered the letter If dont answer the letter, assumed that you are on "oard with deal

o 3ituations where erformance can satisfy statute of frauds Ignore for exam

=%at t.'e of writing does it need to (e&

What tye of writing deends on the tye of contract in consideration.# Common Law

$. material terms'. signed "y erson against whom you are trying to enforce agreement

All material terms must "e included in the writing. D@our offer on Govem"er T, $TTT isaccetedE is not an ade0uate writing. here is no indication of who they are and what they areintending to do. It is imortant to look at who signed the writing, "ecause only those whosigned their name to the document can "e held to what it says. Cxamle & A contract for 4U3and :arsha %lark for a *Fyear term at 1, a year exists. his contract was signed "y4U3, "ut not "y :arsha %lark. :arsha can sue 4U3 (who did sign the contract) on the contract

even though she did not sign her name to it. 4U3, on the other hand, cannot sue :arsha on thecontract "ecause she did not sign her name to the terms. 3he may have agreed to the terms,"ut its not "inding and she has an 3O/ claim.

2 UCC

$. 2uantity term'. 3igned

+nlike the common law re0uirement for all material terms, under the +%% a valid writing

only needs 0uantity term to comlete, the +%% will fill in the rest.here is a secial rule that alies if "oth arties are merchants. If one of the arties

sends a letter to the other claiming that the other has entered into a contract, the notifiedarty has $ days to resond or else the contract "ecomes legally "inding.

+A*OL E>!DE"CE *ULE

Imact of a written agreementsueriority of written agreement Imact a writing has on earlier agreements

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o Cven if earlier agreements are in writing >arol evidence9 evidence of some agreement made rior to this writing

o !oes not have to "e oral Integrated agreement9 it is written, intended "y arties to "e their last word

o Written and final word %omlete integration9 it is a writing that is final and comlete >artial integration9 it is written, final as to what it covers "ut it may not "e the whole

deal :erger clause9 shorthand way of descri"ing a contract rovision that says this is the

comlete dealo o determine if comlete or artial

+arol E,idence *ulehere is a contract, "ut what are the terms? 8ule of contract law a"out what the terms of thecontract are. /our issues to know9 what the rule is, what facts trigger the rule, ossi"le issues,

how the rules are different from statute of frauds. Often the two are confused and testedtogether.

$. >arol evidence rule & when there is a W8ICG contract that is intended "y the arties to"e their final agreement, then you %AGGO use earlier agreements to change the terms ofthat written contract.

'. What triggers the rule?a. here :+3 "e a W8ICG %OG8A% (if there is nothing in writing you never get to

the arol evidence rule). Cffect the written contract has, the imortance of the terms

included.". It :+3 "e the contract that the arties intended to "e the final agreement.

(Integrated agreement & writing intended to "e the final agreement)c. here :+3 have "een some earlier agreement, oral or written. Cffect of agreement

has on earlier agreements, the effect is that you cannot use the revious agreements tochange the terms.

*. >ossi"le issuesa. !oes the arol evidence rule aly (Was it an integrated agreement? his is a 0uestion

of law for the Budge.)

". Was there a merger clause? & a contract rovision stating that this is our finalagreement.

c. Is there an alica"le excetion to the arol evidence rule?$) @ou can always introduce evidence to esta"lish a defense to the existence of the

contract. (i.e. argue fraud, duress)') @ou can introduce the earlier agreement to show a mistake in reducing the agreement

to this final writing. (i.e. evidence through artial writings, oral conversations)

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*) he earlier agreement doesnt change the terms of the written agreement, "ut it addsterms to the written agreement. Was the writing intended "y the arties to "e theircomlete and final agreement? (was it artial integration?) A8C GO 8@IG; O%=AG;C =C W8IIG;. It is at the Budges discretion as to whether the contractis integrated or artially integrated. !id the arties mean for the writing to "e theirfinal and comlete agreement?

1. =ow different from the 3tatute of /raud?he 3O/ is "rought u when you are deciding whether you have a legally enforcea"le agreementriggered "y the hrase there was an O8A agreement. /or >arol Cvidence, you are ast thatstage and you are considering the terms of the contract. here must "e a W8ICG contract.

* "asic oints$) where you have an integrated agreement, arol evidence can never contradict it2; What if arol evidence doesnt contradict the integrated agreement "ut simly adds terms

to it?o When will the court consider arol evidence here?o 2ues. for courtFFGeed to find out if this is a comlete integration?

5; even if it is a comlete integration, arol evidence can "e used to exlain am"iguous terms

arol evidence rule9 cant contradict, can sulement and can exlain

CO"*AC !"E*+*EA!O"

what does the deal mean?course of 'erformance

all a"out what these eole have reviously done under this very duty ersuasive form of extrinsic evidence as to what the deal means same eole, same deal

course of dealings

not as ersuasive what these very eole have done under earlier similar deals same eole, similar deal

custom and usage

what different eole have done under different "ut similar deals

relevant and some evidence "ut not as ersuasive as first two


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+%% is great to fill gao !m'lied o(ligation of good fait%good faith is made art of erformance of any

sale of goods contract 3ale of goodsalways do article ' /irm offer rule

o !m'lied warrant. of merc%anta(ilit.

3ituation in which a erson who regularly sells goods of that kind, sellssomething and it turns out to "e defective

Cx. anytime Bewelry store sells Bewelry, even though no discussion of 0uality,you have to assume it is ok

3eller must "e in "usiness of selling goods of that kind, then law imoseso"ligation on that seller

Adds a term to the contractthe goods must "e okaymust "e fit forordinary uroses

QUES!O" ?4D!D SO-EO"E "O DO =0A 0E AE A" ECUSE )O* "O DO!"< =0A 0E

Aerformance was conditional and one condition was unmet Cx. 6 contracts to "uild "uilding for Othere are rogress ayments

o >ayment of rogress ayments is conditioned on an architects certificateo If an architect doesnt arove a month of work, dont have to make the ayment

"#c you are excusedo Ok not to erform "#c condition not met

Cx. will "uy house if araised at $, "ut it was only araised at T,no need to"uy

:ust look for exress condition in fact atternso ook for words DifE Drovided thatE Dso long asEo Anything short of the hrase Don condition thatE you are going to add statement to

answer, Dif there is any dou"t a"out whether the contract language creates anexress condition, that the referred interretation is no conditionE

If you determine that there is language of condition, the general test for conditions isconditions must "e strictly comlied with

o If the house is araised at only T,o aco"s U @oung v. 4ent

Owner wanted 8eading ie "ut "uilder used a different kind of ie %ourt said this was not language of exress condition

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=omeowner did not say I will only ay you if you use reading ie !ifferent result if language was an exress condition

o %ourts try to conclude that there isnt a condition If there is any way to conclude that there is not an exress condition, that is way court

will go') 6reach "y the other arty as an excuse for non erformance

I dont have to erform "#c other guy didnt do what he was suosed to do 8emem"er to look to see what law to aly Article ' differs most from common law here

o Article ' has erfect tender standard Anytime the seller of goods is less than erfect, not exactly what "uyer

wants, "uyer is excused from erforming "#c seller did not do erfecttender

;eneral standard for sale of goods is erfect tender hat standard is su"Bect to ' "ig excetions

o $. cure9 in certain limited situations, "#c erfect tender standard is so high anddemanding, give seller second chance

watch for situation in which the seller sends the wrong stuff earlySS :ust give delivery deadline in this fact situation If seller can still get right stuff there "y deadline, then no ro"lem

o 2 installment sale contract9 where arties in their agreement have agreed thatthere will "e deliveries in several searate installments

if agreement rovides for these installments, a ro"lem with one installment,so long as not su"stantial ro"lem, will not excuse ayment

it can "e adBusted in future installments

if common law contract, not a sale of goods and one guy is arguing that one guy "reached sodont have to erform, must do a material (reac% rule major screw u' rule;

when will one arties non erformance excuse the other?o Cx. = hires > to aint his housedeal is that house must "e ainted in two coats

with 3herwin Williams aint his is common law contract urns out that ainter you hire is "ig fan of >rice 3o he aints your house urle !ont have to ay "#c material "reach What if ainter "uys different "rand of aint instead "y accident?

It is a "reach "ut still have to ay "#c not a maBor screw u ormaterial "reach

' excetions to material "reach ruleo language of condition excetionif contract said I will ay you $ for ainting

my house white on the condition that you use 3herwin Williams aint22


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this re0uires strict comliance "#c conditiono divisi"le contract excetion

ex. = has huge house ' rooms= hires > ainter to aint whole house for1> only aints * of the ' rooms

is this material "reach? @C3 is = excused from aying? @C3 if unfair, go to 0uasi 4 (e0uity) ex. = hires > to aint ' different aartments for ' each

this is divisi"le if ainter aints * of the aartments, law would say this is divisi"le so

you did erform with resect to the * aartments

5;antici'ator. re'udiation

o I tell you "efore you finish that Im not going to ay youo Cxcuse for stoing worko Cxcuse of non erformancegives right to sto erformance and sue immediately if

told youre not going to "e aid

1) later agreement' forms no,ation9

o "oth of the guys who made first deal agree that another erson can erformo other erson is a no showo initial guys erformance is excused "y later agreement of ally mc"eal doing

it accord and satisfaction9

o change in what is going to get doneo agreement to clean house instead of aying money (that is the accord

agreement to do something different than first agreed to do)o "y actually cleaning house, that is satisfactiono DandE in order to have this excuse, must have "oth accord AG! satisfaction

so that if I dont actually clean house, can still sue me on original romise toay money

!-+OSS!B!L! )*US*A!O" O) +U*+OSE !-+*AC!CAB!L!

Another excuse for non erformance

easy facts to watch for are time se0uence deal was made and later, after the deal something haened what haened was unexected (unless it is totally unexected there is no excuse)

harder facts to watch for whether either arty had assumed the risk in some way

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did it make the erformance imossi"le?o Casy case9 aylor v. %aldwell9 concert hall "urning downo his is ost contract occurrence, unforeseea"le, and so it was imossi"leo his is destruction of su"Bect matter of the contracto Jariations are often on exams

=omeowner contracts to "uild housewhen house is TV comlete it "urnsdown

Geither arty assumed risk 8elationshi "etween unforeseen occurrence and erformance Got imossi"le to re"uild house Is guy excused from erforming? GO :ay "e excused from "eing late "ut still must "uild house Got imossi"le nor imractical

8ule of thum"if all that haens is that there is a later unforeseen occurrence, that makeserformance more exensive, the tough luck rule, it is not imossi"ility or imractica"ility

3ome situations in which even if it is not imossi"le that the "urden may "e so great that it will"e excusedusually Budgment call

Imractica"ility

)rustration of 'ur'oseis similar and different from imossi"ility 4rell v. =enry9 guy who rented a flat to watch the coronation arade

o >arade gets canceled and he wants out of the deal "#c his whole reason for renting

the flat was to see the arade so his urose has "een frustratedo =e can still use flat thougho Where "oth guys know of the urose of the deal at the time the deal is made and

there is something that haens after the deal, it doesnt affect a"ility toerform, it affects reason of erformance

o Gon erformance will "e excused Imossi"ility is in +%% Go +%% rovision for frustration of urose

o :ay aly to sale of goods

Sometimes 'eo'le w%o were not 'arties to contract %a,e rig%ts under t%e

contract

5rd'art. (eneficiaries

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%ontract "etween two eole and "oth intend for a third arty to "enefit from thecontract

ife Insurance contractinsured "ought the contract, insuror is comany and someoneelse will "enefit

Where contract was made with intent to "enefit you, you can sue to enforce it Got urely insurance law Intended third arty "eneficiary

*rd arty "eneficiary9 didnt make contract "ut intended to "e "enefitedromisor9 guy whose romise goes to *rdarty "eneficiary

;uy whos romise goes to the *rdarty "ene Insurance comany

romisee9 guy who takes out insurance olicy

creditor "eneficiary or donee "eneficiary rule of thum"if in dou"t, call it donee only time creditor "eneficiary is when third arty was revious a creditor of romisee

o ex. I owe =eidi $I say Ill name her in life insurance olicy insteadshe iscreditor "eneficiary

o donee "eneficiary is if I felt sorry for =eidi and said I would name her in olicy *rdarty "ene can always sue the romisorSS

8ights of third arty do not deend on rovision of consideration or notthey are simly theintended "eneficiary

>romisor lia"le to *rdarty "eneficiary

If *rdarty "ene was a creditor "ene, he can also sue romisee on original de"t

DELE


26/33

o cant delegate secial skills3alvador !ali cannot delegate to me to aint icturehe was suosed to

most duties are delega"le

ex. = hires > to aint his house contract says nothing a"out delgation > gets H to do work instead If H doesnt do work, = can still sue > H does the workwhat result? Issue of the 0uestion is is the duty delega"le? @C3

ASS! "ene or assignment *rdarty, all * eole are involved in contract from "eginningintent to "enefit from the

"eginning if 8o"in was "rought in from the "eginning and told ;otham to ay 8o"in, then *rdarty

"eneassignor would "e 6atmanmakes contract and later assigns his rights to someone else

assignee is 8o"indidnt make contract "ut can enforce ito"ligor;otham

effect of assignmentassignee can sue o"ligorif 6atman does work, 8o"in can come in and sue;otham for ayment

common law limitation on making of assignments cannot make an assignment that su"stantially changes the duties of the o"ligor ex. assume 6atman makes contract with ;otham to rovide security services and assigns

right of ayment to 8o"ino no ro" "#c havent changed duties of ;otham (the o"ligor)o Bust as easy to ay 8o"ino assignment of a right to ayment is never a ro"lemnever su"stantially changes

duties ex. 6atman makes contract with ;otham to rovide security services, :etroolis wants

6atman to defend their city so ;otham gives 6atman to themo 6atman


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o ;otham


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a. A "uyer that has a articular urose and is relying on the seller to rovide that good andthe seller knows of the "uyers need and reliance on the sellers exertise. est will haveto tell you why the "uyer is "uying the good and that the seller is AWA8C. ;o to theshoe store "ecause you need mountain clim"ing "oots, "ut shoe sales man sells you%onverse tennis shoes. Adds term, DI know what you want, I know what you need, here itis.E

! +erformance O(ligation

A. :akes certain that the terms have "een comlied with. It turns on the terms of thecontract.

6. %onditions$. :odifies the o"ligation to erform (i.e. I will "uy your house if it araised at

$,). hat is "eyond the arties control'. An exress condition must "e strictly comlied with. (i.e. if T-, you are not

legally o"ligated to "uy)*. DI will ay if I am satisfiedE (re0uires the aroval of one of the contracting

artiesa. It is not illusory, it is legally enforcea"le". If the su"Bect matter of the contract is such that it involves ersonal taste

and individual Budgment, then it is read literally. (if the erson is not satisfied,they dont have to ay). /or examle, if I contract a erson to aint myortrait, satisfaction is "ased on my su"Bective satisfaction.

c. If it a more ordinary contract (i.e. aint house), then even though the contract

language says DIE it is read as if a reasona"le erson would "e satisfied.O"Bective standard.

%. 3eller of ;oods >erformance O"ligations F +%%$. here must "e a erfect tender. he seller is o"ligated to deliver exactly what

the terms call for. (%ontract for $ widgets, TT is a "reach. his only alies inarticle ')

'. 8eBection of the goods & if the seller does not make a erfect tender, the "uyerhas the otion to reBect the goods.a. there is a difference "etween a reBection of an offer (no contract & cant sue)

and a reBection of the goods (still contract & can sue)*. 8evocation of accetance of the goods & tested with reBection

a. he "uyer is acting immediately and the "uyer can reBect the goods if they areanything less than erfect.

". If there was a su"stantial ro"lem with the goods that was difficult to discoverearly on, they can still revoke the contract

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!! E/cuse of "on'erformance

A. Gonerformance is sometimes excused, - grounds for excuse6. If there was a conditional o"ligation and the condition wasnt met (6uy house if

araised at $'4, "ut turns out $$P & excused)%. he other arties "reach (+%% erfect tender & the items are not erfect). A

material "reach excuses the other arty from erforming. >ainting house for $4,get aint on the windows, can get away without aying $4? >ro"a"ly, "ut will have toay something. If I aint if urle rather than white, then ayment would "e excused"ecause that is a material "reach.

!. Anticiatory reudiation & early revocation. he other arty is excused.C. ater agreement that excuses nonerformance

$. Govation & two eole make a contract and later "oth agree that a new arty canerform the contract. If that third arty "reaches, you cant sue "ecause itexcuses the other arty (%ant sue the originally contracted arty? & yes, theoriginal arty is excused, agreement to su"stitution is critical)

'. Accord and 3atisfaction & the excuse re0uires "oth the accord and thesatisfaction. It changes the deal with the same two arties. (i.e. Owe $. >ainthouse instead)a. Accord < new agreement, does not affect the original agreement. 6reach

results in suing on either condition & money or aint house.". 3atisfaction < actual actc. !oes agreement as modified fall within the 3O/?d. When do we need consideration for changes in contract? Got +%% "ecause

there is no >C!8, "ut it is re0uired in common law cases.

/. ater unforeseen occurrence$. Imossi"ility F Where there is a later unforeseen occurrence that is no ones fault,

the nonFerformance is excused. aylor v. %aldwell & concert hall lease, afteragreement made the hall "urned down. aylor sued for "reach of contract, cantuse concert hall.

'. /rustration of >urose & erformance isnt imossi"le, "ut it takes away theurose of the contract. he agreement is unenforcea"le. 4rell v. =enry & guywants to see the coronation arade. /lu eidemic and arade called off. Its notimossi"le, "ut the urose for agreement is frustrated "y later occurence.

!!! Breac% *emedies

A. i0uidated damages & the arties have agreed what the damages are to "e. hey arevalid if$. he contract is uncertain as to what the ossi"le damages might "e'. hey are a reasona"le measure of what these uncertain damages might "e.

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hese are tested as to the time that the agreement is made, when no one knowswhat the damages are. If you are told what damages actually made it is irrelevant,that info was not availa"le at the time of the agreement. Was this a reasona"leway to deal with it?

6. here are GO >+GIIJC !A:A;C3 IG %OG8A% AW or +%%. %ontract law isnot interested in unishing "reaching arties. orts allow unitive.

%. %onse0uential damages & recovera"le only if reasona"ly foreseea"le "y "oth of thearties at the time of the contract. =adley v. 6acksendale(?) Cnglish mill in smallvillage. Go one knew how to fix the %rank 3haft. Inexcusa"le delay. 6ecause you"reached, something else "ad haened to me. hese are indirect damages and onlyrecovera"le if reasona"ly foreseea"le "y "oth of the arties at the time of thecontract. (ose money "ecause delay in ainting caused owner to miss the season tosell the house, costing -. /or recovery, this must have "een foreseea"le "y "otharties.)

!. 8eformation & need to conform the written contract to what it is that the arty

actually agreed to. We agree its the $T south acres, "ut the written agreementcomes out $T southeast acres. %onform to meet the arties agreement.

C. 3ecific erformance & court order directing the arties to do what they contractedto do. C0uita"le remedy that is only used when the legal remedies are not sufficient.All e0uita"le remedies are only availa"le when money damages are not enough.$. land sales & land is uni0ue, transfer of ownershi'. sales of uni0ue goods (anti0ues, works of art, made to order)*. ersonal services contracts & GO 3>C%I/I% >C8/O8:AG%C1. Gegative secific erformance or inBunctive relief & stos you from doing

something. >at 8iley under contract to coach the 4nicks, "ut he doesnt want to.hey cant sue him to force him to coach, "ut they can get an inBunction disallowinghim from coaching another team.

/. :oney damages$. he goal is to ut the nonF"reaching arty in the same osition that she would have

"een in had the contract "een erformed. Cxectation damages.a. Identify the nonF"reaching arty". What would the erson receive if the contract had "een roerly erformedc. What would it take to award damages that would have "een due?

'. Cxamlesa. "reach contract for $ for ainting house. Gew ainter charges $-. If

"reaching arty ays -, thats where the erson would "e had the contract"een erformed

". Ive "ought the aint in rearation and you "reach. =ow measure thedamages? ;ive costs and rova"le lost rofits. What a"out unilateral contractaccetance "y erformance?

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c. 3ale of goods & sell %addy thats in mint condition, "ut its not in mint condition.@ou want to kee the car, "ut you want some of the money "ack "ecause its notin mint condition. !elivered in $- condition, had it "een in mint condition itwould "e worth -. rying to ut the innocent in the same condition as ifthe contract had "een erformed & would have had car worth -, "ut youhave car worth $-. %onse0uential damages recovera"le only if reasona"lyforeseea"le "y "oth arties

!> %ird +art. +ro(lems

A. hird arty "eneficiaries & two eole contract with each other with the intent of"enefiting a third arty. he third arty has legal rights and can enforce it (i.e. "uylife insurance olicy, you agree to ay ayments, they agree to ay son at your death.3on can enforce the contract.)$. hird erson "ene & erson not a arty to the contract "ut can still enforce it

"ecause the other arties made the contract with the intent of "enefiting them.

a. creditor "ene". donee "ene & most *rdarty "enes. It is a donee "ene +GC33 the *rdarty

was already a creditor of the romiseec. canceling or modifying

i. contract language controlsii. the contract cant "e canceled or modified until the *rdarty knows and

assentsd. the *rdarty can sue the romisor and the romisee can sue the romisore. the *rdarty can sue the romisee if the *rdarty is a creditor "ene.

f. >romisor < the erson who is romising to do something for the *rdarty(insurance comany)

g. >romisee < other arty to the contract'. Assignments & an agreement "etween two eole and one of the arties to the

original contract transfers away (assigns) his rights to a *rdartya. he assignee can sue the o"ligor. he assignee stes in the shoes of the

assignor.". =aens in stes & two arties make a contract, =CG one of the arties

assigns his rights to a third arty

c. 3imly su"stitutes one arty for another arty*. !elegations & two eole make an agreement and then later one of them gets

some"ody else to do the worka. When ossi"le

$) contract rovisions always control') if no rovisions, you can generally delegate duties unless you are talking

a"out a situation that involves secial skills or a erson involving a secialreutation

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". %onse0uences$) the delegating arty remains lia"le') delegatee & he is only legally o"ligated if he received consideration

c. %omare delegation and novation$) When you delegate, if you ask the other arty and they agree, it "ecomes a

novation') +nder delegation, you remain lia"le.*) +nder novation, you can sue the delegatee.

d. %onnection "etween *rdarty "ene and delegation$) if the delegatee receives consideration from the delegating arty, it is a

delegation for consideration AG! a third arty "ene.What haens if the 3O/ is not satisfied?

he 3O/ is a defense to contract formation. When you have a situation that falls withinthe 3O/, and the 3O/ is not comlied with its a defense that needs to "e resented and rovedto revent enforcement. If you cant sue on the contract, always look for a 0uasiFcontract

remedy.

Equal Dignit. *ule& this concerns when it is necessary to have written authority for a thirdarty to act on "ehalf of someone else in a contract. AuthoriKation must have the same degreeas the contract the erson is entering the other into. An agent needs written authority toenter into a contract for another when the contract is re0uired "y the 3O/ to "e in writing.his issue turns on whether the 3O/ re0uires the contract to "e in writing and usually occurs inreal estate dealings. In order to enter into a lease for another erson, do I need writtenauthority to do so? If the contract is over $ year I do need written authority.

!llegalit.

If there is a 0uestion of illegality, the issue turns on knowing the difference "etween acontract with illegal su"Bect matter and an illegal urose.$. If H contracts with @ to kill for -, neither H nor @ can enforce the agreement. he

contract deals with illegal su"Bect matter and is therefore void.'. If @ contracts with a ca" driver to take him to the sot to kill , the ca" driver can recover

from @ "ecause their contract dealt with illegal urose, and the ca" driver is more than

likely unaware of @s urose in going to the sot.

8eBection F %ounter offer, conditional accetance, adds terms under common law

erms of Contract

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he terms of a contract are found in what is written and what is said. @ou can also findthem in the terms of revious dealings, if there has "een a course of dealings "etween the twoarties. he custom of the industry is relevant and can dictate the terms and what they mean.

>rior dealings & how these eole did their deals together, erson secific%ustom and usage & info a"out how deals with other eole in the industry were done

Documents

Contracts_Barbri_Outline-Video.doc