Parol Evidence
Rule
Rule
What is the Parol Evidence Rule?
If parties have put contract in writing, they can’t bring up what was said before to the contract was written to supplement or contradict the contract
What are implied terms?
terms that are not explicitly included in the contract, up to the court to add them in
Explain the difference between void and voidable.
void = never a contract to begin with
voidable = contract that can be waived by the court
What is unconscionability? What are oppression and surprise?
grossly unfair contract
oppression = inequality of bargaining power
surprise = fine print, hidden terms
What is impossibility? Give an example.
contract performance is literally impossible
non-occurrence of an event on which the contract was based
What does it mean for a contract to be "integrated"? What are the two approaches to determining if a contract is integrated, and how does this relate to PER?
integrated = fully final and complete
approaches: 4 corners vs contextual
PER applied if integrated, can't be contradicted or supplemented
What factors are used in the contextual approach to interpretation?
course of performance
course dealing
trade usage
Are contracts made by minors void or voidable? What happens when they turn 18?
voidable
ratified at 18 if no steps taken to exit, minor is liable for value of use of contract
What is misrepresentation? What are the elements?
assertion not in accordance with facts
1) misstatement of existing fact
2) fraudulent (knowingly false or reckless)
3) induced recipient to make contract
4) recipient justified in relying on misrep
What is frustration? Give an example.
reason for entering contract is frustrated/undermined
pointless to go through with contract
What are the steps for PER inquiry?
(1) find PER issue
(2) decide if contract is integrated
(3) apply PER (if answer to (2) is yes → evidence can’t come in)
(4) consider exceptions
What are the rules of giving notice to terminate?
(1) must give reasonable notice (generally)
(2) don’t have to give notice if contract has “triggering” event
(3) can agree that no notice is required
Not allowed if it would be unconscionable
What are the elements of duress? (3 main ones, +1 sometimes)
1) threat
2) no alternative
3) causation
4)* hardship caused by pressuring party
What are the three potential scenarios for non-disclosure?
(a) where they know that the disclosure of the fact is necessary to prevent some previous assertion from being a misrepresentation or from being fraudulent/material
(b) where they know the disclosure would correct a mistake of the other party as to a basic assumption on which that party is making the contract and if the non-disclosure of the fact amounts to a failure to act in good-faith
(c) where the other party is entitled to know the fact because of a relation of trust and confidence between them
What is impracticability? What are the required elements? Give an example.
contract performance significantly more difficult/expensive
Elements:
Must have been a basic assumption of contract that no longer holds true
Contract must be impracticable to perform as is
Must not be the fault of the party seeking to avoid the contract
Must not have assumed the risk
What are the exceptions to PER?
contract subject to oral precedent
contract invalid via avoidance doctrines
collateral contract
What is a satisfaction clause? What are the two standards used, and when are they used?
clause stating something must be done to a party's satisfaction
objective standard -> utility, subjective standard -> aesthetic
What are some factors of undue influence?
(1) discussion at unusual or inappropriate time
(2) consummation in unusual place
(3) insisted demand that business be finished at once
(4) extreme emphasis on untoward consequences of delay
(5) use of multiple persuaders by dominant side against a single servient party
(6) absence of 3rd party advisors to servient party
(7) statements that there’s no time to consult financial advisors or attorneys
What is misunderstanding? How does it affect the contract?
confusion over what is being bargained for -> no contract
What is the Roth test?
(1) party may in good faith, seek modification when “unforeseen” economic exigencies arise
(2) even where circumstances do justify in asking for modification, it’s nonetheless bad faith to attempt to coerce one by threatening breach
What is a collateral contract?
supplement to the contract that can stand on its own and doesn't contradict the contract
What are requirements and output contracts? Does good faith apply to entry, enforcement, or both?
buyer promises to purchase all requirements from seller, or seller promises to sell all outputs to buyer
applies only to enforcement
Give an example of an undue influence case.
gay teacher guy
What is mutual mistake? How does the court evaluate it?
both parties didn't know about a particular fact
distinction between matter going to substance of transaction vs value
Does modification require new consideration?
YES at common law, NO under article 2