Basic Contracts Concepts Flashcards
what is a contract
A legally enforceable agreement
a promise or set of promises for the breach of which the law gives a remedy or the performance of which the law, in some way, recognizes a duty
Approach for determining if there’s a K
(1) look for if an agreement was formed
If yes, go to (2)
(2) see if the agreement is legally enforceable
Types of contracts
express — formed by language, written or oral
implied in fact – formed by conduct
quasi-contract – the name given when an unenforceable contract results in unjust enrichment [not a real contract] -
what type of remedy does a plaintiff seek when their contract is unenforceable and the other party was unjustly enriched?
restitution [remedy of last resort]
what is a bilateral contract and how can you accept an offer for one?
A promise for a promise [each party promises to do something in exchange for something else]
Can be accepted in any reasonable way, such as by promising or beginning performance
pretty much all contracts
what is a unilateral contract, in what situations does it occur, and how do you accept one?
A K in which the offeror requests performance rather than a promise; offeror promises to pay upon the completion of the act
Contract is formed once the act is completed
You can only accept by performance
Occurs when:
(1) the offeror clearly (unambiguously) indicates that completion of performance is the only manner of acceptance
Ex: “Offer …. only by”
or
(2) where there is an offer to the public, such as a reward offer
void contract
one without any legal effect from the beginning
never unenforceable
voidable contract
a K that is not void ab initio but parties seek to void it such as by raising defense like infancy or illness
an aggrieved party may elect to enforce a voidable K
void/voidable vs. unenforceable
unenforceable just means it is not enforceable due to a defense, not that it is not valid
when does UCC apply
sale of goods
what are “goods” for UCC purposes
all things movable at the time they are identified as the items to be sold under the K
YES cars, horses, hamburgers
NOT real estate, services (health club membership, employment), intangibles (patent), construction Ks – this is common law
who are merchants
in general and
for what kinds of contracts
IN GENERAL: ppl who regularly deal in goods of the kind sold or who otherwise by their profession holds themselves out as having special knowledge or skills as to the practices or goods involved
K DEALING IN GENERAL BUSINESS PRACTICES [SoF, confirmatory memos, firm offers, modification] pretty much anyone in business can be a merchant
IMPLIED WARRANTY OF MERCHANTABILITY AND SOME OTHER PROVISIONS - merchant must be a merchant with respect to goods of the kind involved in the transaction
how to determine whether UCC applies when goods and services are being sold
determine which aspect is dominant and apply the law governing that aspect to the whole contract
if equal, apply UCC to sale of goods portion and common law to services portion
what is good faith and fair dealing
every K within UCC imposes this obligation
good faith = honesty in fact and observance of reasonable commercial standards
common law good faith and fair dealing
a breach involves exercising discretion in a way that deprives the other party of the fruits of the contract
