Capstone Contract Class One Flashcards
(29 cards)
When is a revocation effective?
When received by the offeree
A revocation is effective upon receipt, which occurs when it comes to a person’s attention or is delivered at a place of business through which the contract was made.
When is\ written communication of a revocation deemed to be ‘received’ under contract law?
It comes to a person’s attention or is delivered at a place of business
The recipient need not read the communication for it to be considered received.
Under the UCC, how long can a merchant’s firm offer be held open without being revocable?
Not to exceed three months
A firm offer must be in a signed writing that assures it will be held open.
True or False: A verbal assent by a supplier is sufficient to qualify as a firm offer under the UCC.
False
A verbal assent does not meet the requirements for a firm offer.
Fill in the blank: A business owner’s revocation is said to be “received” when the revocation letter arrives _______.
At the same place where the contract came about or executed.
The timing of the arrival determines the effectiveness of the revocation.
What happens if the term assuring that the offer will be held open is on a form supplied by the offeree?
It must be separately signed by the offeror
This is a requirement to ensure the validity of the firm offer.
What is the effect of a revocation letter not needing to be read by the recipient?
It is still considered effective upon receipt
The communication is effective regardless of whether it is read.
What makes a promise modifying a duty under a contract binding?
The modification is binding if it is fair and equitable in view of circumstances not anticipated by the parties when the contract was made.
This applies to contracts not fully performed on either side.
Define a requirements contract.
A requirements contract is where a buyer promises to buy all goods required from a certain seller, who agrees to sell that amount.
No specific quantity is mentioned; it is determined by objective, extrinsic facts.
What is promissory estoppel under section 90 of the Second Restatement?
A promise is enforceable without consideration if the promisor reasonably expects to induce action or forbearance, and such action or forbearance is in fact induced.
The remedy may be limited as justice requires.
What happens if only one party is mistaken about facts in a contract?
The unilateral mistake will not prevent formation unless the nonmistaken party is aware of the mistake, making the contract voidable for the mistaken party.
How can a contract be enforceable despite the Statute of Frauds?
A contract can be enforceable if it is fully performed, such as when goods are received and accepted by the other party.
Example: A boat builder accepting sails despite an oral contract.
What is a shipment contract under the UCC?
In a shipment contract, the seller must ship goods by carrier but is not required to tender them at a particular destination.
Risk of loss generally passes to the buyer when goods are delivered to the carrier.
When does the risk of loss not pass to the buyer in a shipment contract?
The risk of loss does not pass until defects are cured or the buyer accepts the goods if the buyer has a right to reject the goods.
What is required under UCC regarding goods and their delivery?
Perfect tender is required; the goods and their delivery must conform to the contract in every way.
What constitutes an express warranty?
An express warranty arises from any statement of fact or promise made by the seller.
Example: A salesperson stating that a racket is made of titanium.
What is an implied warranty of merchantability?
An implied warranty of merchantability arises in every sale by a merchant unless disclaimed, ensuring goods are fit for ordinary purposes.
What is a condition in contract law?
A condition is an event that creates, limits, or extinguishes the absolute duty to perform in the other contracting party.
What happens when a party waives a condition?
If a party indicates they will not insist upon a condition and the other party detrimentally relies on it, a court may hold this as a binding estoppel waiver.
Can a promise to waive a condition be retracted?
Yes, a promise to waive a condition may be retracted at any time before the other party has detrimentally changed their position.
What rights does an assignee have against the obligor?
An assignee has whatever rights his assignor would have against the obligor.
What defenses is the assignee subject to?
The assignee is subject to any contract-related defenses that the obligor has against the assignor.
What happens if a company completes all tasks except for one minor task?
If the work remaining on the contract is minor, the company will be seen as substantially performing its contract.
What is an accord?
An accord is an agreement in which one party agrees to accept a different performance in lieu of the original performance.
