Contract Formation
What is a contract and the two sources of law?
A contract is promise or set of promises/performance requires offer, acceptance, intent and consideration.
Offer can be terminated before acceptance when?
Rejection/Counteroffer , Revocation, Lapse of Time, Death.
UCC 2-207 Rejecting Mirror Image Rule
non- matching terms are considered proposals, non-matching terms for merchants become part of the contract unless materially alters.
What is a condition?
an uncertain event that must occur before a party can be required to perform
What is a Breach?
any failure to render full performance when performance is due
The 3 requirements of a contract are?
Offer, Acceptance, and Consideration
What is an Option Contract?
offeror keeps offer open for certain time in exchange for offeree's consideration.
What is it when a promisor makes a promise and the promisee reasonably relies.
Promissory Estoppel
What happens if condition fails and performance is required?
Nonoccurence examples
Estoppel= The obligor promised to perform despite the nonoccurrence; the obligee reasonably relied on that promise to their detriment; and enforcing the condition would unfairly harm the obligee.
Waiver= The obligor can waive a condition by expressly stating so or accepting performance despite knowing of the nonoccurrence.
Disproportionate forfeiture= condition not material
What to look for in material breach?
Loss of benefit of injured party
adequacy of compensation to injured party
is there a cure
is there a forfeiture of breaching party
What is an Offer?
The manifestation of willingness to enter into a bargain with clear and definite terms that have been communicated to the offeee.
What is a Firm Offer?
UCC, signed writing by a merchant, to buy or sell goods open for limited time. can be revokes after 3 months, no consideration required.
What is covered under the Statute of Frauds
MYLEGS
Marriage, 1 year contracts, Land contracts, Executor, goods over $500 and suretyship contracts.
What terms need the court to interpret?
Indefinite, Ambiguous and Omitted terms.
Indefinite= terms are left open and uncertain
Ambiguous= terms have multiple meanings
Omitted= courts will use gap fillers, or impose duty of good faith
What is anticipatory repudiation?
A party can sue remedy before breach, party gives statement indicating a clear breach.
What is Acceptance?
Acceptance is the assent in the form of a promise or performance with the same terms as original offer. Anything else is counter offer/ rejection.
What is the mailbox rule?
Acceptance upon dispatch even if it is not received. Not applied to Option contracts (upon receipt), no unilateral (needs full performance), offer provides time of acceptance that is not upon dispatch.
What are defenses to enforceability?
Lack of capacity, Mental illness, intoxication, Durress, illegality, unconscionability, misrepresentation.
What is an express warranty?
based on seller's to a buyer guaranteeing the goods can conform.
What is Consideration?
Consideration is a bargain for exchange in the form of a promise, an act or giving up something.
What is Mirror Image rule?
requires acceptance to be unconditional assent to the exact same terms that were stated in the offer.
What is Parole Evidence?
Extrinsic evidence of any prior agreement
1. to prove a contract is partial or complete integrated
2. used to clarify ambiguous terms
3. to support a defense to enforceability such as illegaility
4. whether a remedy can be used or denied
What is implied warranty of merchantability?
guarantees that the goods are merchantable and is automatically created when the seller is a merchant of those goods.