Chapter 12
What are the four things that can negate mutual assent?
1.) Mutual mistake of material fact not related to value
2.) Misrepresentation
3.) Undue influence
4.) Duress
The purpose of the statute of frauds is to prevent fraud from being committed against ____ and _____
Contractual parties and the courts
What is the rule of contractual interpretation?
The court will attempt to interpret the parties' contract to give effect to the parties' intent as expressed at the time the contract was formed.
Discharge of performance does not mean "The End"; instead, it means ____
"To be continued"
1.)True or False: A contract in Writing is always more enforceable than an oral contract.
2.) True or False: Creating a written contract slows down the process of contractual formation.
1.) False
2.) False
Explain the significance of the case: Raffles VS Wichelhaus
dealt with a mutual mistake of material fact not related to value
"Any agreement the consideration of which is whether to marry" deals with ______ agreements and _______ agreements
prenuptial and antenuptial
What are the two types of third parties to a contract?
1.) Assignees and delegees
2.) Beneficiaries (intended and incidental)
What are the five ways, discussed in class, that a contract can be discharged?
1.) By Performance
2.) By Breach
3.) By Agreement
4.) By operation of Law
5.) By Non-occurrence of a contractual condition.
1.) For a contract that falls under the statute of frauds, does it have to be "A writing" or "In writing"
2.) What is the difference between "A writing" and "In writing"
The contract must be "In writing."
Concealment is _______ while nondisclosure is _____
Active; Passive
The General Measure of Damages can be defined as
The difference between the market price and the contract price
Mike found a vacant home that he was obsessed with and was determined to fix it up (a lot) and make it his dream home. The grass outside the house was about three feet high and looked like a jungle. The grass was so high that Mike couldn't even get into the home, but he bought the house on impulse. The next day, Mike contracted with AJ to get his lawn mowed. AJ was up for the challenge and was supposed to do it on Friday. However, on Monday night, Mike decided he needed to learn how to mow the lawn himself (he'd never done it before). Even though it was one acre of grass, standing roughly 3-4 feet tall, he was up for the challenge. Can Mike assign his rights under the contract with Aj to Cole, whose lawn was five acres with grass only standing roughly ten inches?
No, doing so substantially increases Aj's duties under the contract.
_____ damages are rarely rewarded in the context of contracts.
Punitive damages
True or False: Courts are reluctant to reform a contract
yes
Can you sue someone for innocent misrepresentation?
no
Young professor James, back in high school, was picking up his girlfriend to go to prom. While he was standing in the kitchen of her home, waiting for her to get ready, he was confronted by his girlfriend's father. The dad tells Professor James that he will give him 10,000 dollars if he leaves his house right now and never talks to his daughter again. James, who has a pretty extensive roster, said, "Deal, I will leave right now." The father, who did well in his job as a late-night waiter, reached into his pocket, pulled out $10,000 in one-dollar bills, and handed it to Professor James. After getting the money, Professor James walked out of the house, intending to never talk to his now ex-girlfriend ever again. Does the contract need to be in writing to be enforceable?
no
Kevin, a widget manufacturer, contracted with a company that wanted to sell his products. Under the contract, the company agreed to pay Kevin $200,000 for 100,000 widgets. So Kevin hired his whole extended family (roughly 100 people), all of whom quit their jobs and moved to Nebraska, where Kevin's manufacturing plant was located. After a week of manufacturing the 100,000 widgets, the company that contracted with Kevin refused to pay him (for whatever reason) and breached their contract. Kevin's extended family may be able to bring suit in _________, against who?
Promissory estoppel against either one of the parties
Long story short, Alex made a big mistake: He got an overly nice apartment in college, and now he has an absurd amount of debt. The last time Alex checked the amount of rent he owed, he noticed the balance was higher than he thought it was. According to his apartment complex, Alex owed $2,700. He called the leasing office and said he only owed them $1,250. Alex offered them $2,000 over the phone to fully satisfy his debt. What problem did Alex make in making his accord? Will his debt be satisfied?
Accord and satisfaction requires that debt be unliquidated.
Debt owed to a rental complex is liquidated debt.
Therefore, Alex cannot offer an accord to satisfy his debt.
What are the exceptions to the LEGAL RULE of the Statute of Frauds?
*key word: "legal"*
1.) admission
2.) Partial performance
Jack, an up-and-coming realtor In Alabama, hoped to sell his first-ever house to his best friend, Cole. He went to great lengths to ensure that everything was in perfect condition in the house. Jack even collected every piece of relevant paperwork regarding the house and organized them in one of those cool metal filing cabinets. Jack searched through septic tank reports, tax statements, electric bills, gas bills, HOA statements, termite inspections, mortgage bills, lawn care receipts, etc. For roughly 8 hours the night before the showing. The next day, Jack finally showed Cole the house. Cole, who is rather annoying, bombarded Jack with questions. Cole sternly asked Jack, "Has the house ever had termites?" Jack, who would never lie to a friend, stopped briefly and thought about Cole's question, "Hmm, to the best of my knowledge, I don't think it has. I've never heard any previous owners mention termites, so I would say no." Cole's face lights up, "I'll buy it right now." After completing all the paperwork, Cole could finally settle down in his new house. Before going to bed in the house that same night, Cole noticed termites ALL OVER THE MASTER BEDROOM WALL. Cole instantly called Jack, saying the contract should be negated. Is Cole likely to be successful? Must explain why or why not receive points
Yes, because Jack negligently misrepresented the termite situation.
It is a negligent misrepresentation, as Jack had access to past termite reports
Mike, a manager at Best Buy, saw how hard his employees had been working lately and wanted to revamp their workspace. Mike decided to order 50 Dell computers (200$ each) for his employees so they could use them at work instead of bringing their laptops to and from work. Does the contract have to be in writing?
yes
Dilly has been a long-term customer of Jack's Lawn Mowing company. They have probably made over one hundred contracts together for services such as lawn mowing, pine straw, mulch, bush maintenance, etc. Recently, Dilly made a new contract (which was written, not because it had to be written, but because that's just how Jack does business) with Jack to get his [Dilly's] whole yard mowed. Long story short, after both parties agreed to and signed the contract, they got into a dispute over the word "Yard." Jack thought the word "yard" just referred to Dilly's front yard, while Dilly thought the word yard referred to both his front and back yard (connected by a small strip of grass). When they got to court, the judge found the context of the contract to imply the definition of the word "yard" to be Dilly's "front yard" only. However, the judge also looked at the word in context in 20 past contracts that Jack and AJ have made and found that in all of the contracts, the word "yard" implied both front and back yard. In this contract, the court will rule the definition of yard to be __________ _______ _______ _____?
Why?
"front yard only."
Parol evidence rule states that the court cannot look to extrinsic evidence if the definition can be ascertained within the contract.
Maguire made an oral contract with Brenden on Monday to sell him [Brenden] his bike on Friday. Brenden paid Maguire at the time their contract was made. On Thursday, Maguire pulled his bike out of the garage and briefly rode it to ensure it was still working correctly. While riding the bike, Maguire instantly felt the back tire pop. Maguire got off the bike, noticed the damages, picked up the phone, and called Brenden, telling him there was no way he could sell the bike by Friday.
1.) Which party's performance is discharged?
2.) What is Brenden most likely going to do?
1.) Maguire's performance under the contract is discharged
2.) Brenden will likely go find another bike and sue Maguire for the difference.
Carson contracted to work as an employee at an accounting firm for $100,000 a year for three years. He was supposed to start his new job on April 16th, 2020. On April 15th, the accounting company called him and said he was no longer going to be working for them (a breach of contract). Carson was then unemployed for AN ENTIRE YEAR; on April 16th of 2021, Carson finally started a new job at a new accounting firm, making $50,000 a year. Assuming Carson ONLY has compensatory damages, how much does he sue the company that breached his contract for on April 16th, 2023?
200,000 (100,000+50,000+50,000)