Cases Flashcards

Question

Dallas Cowboys v. Harris

Answer 1

Dallas cowboys sought a negative covenant to keep Harris from playing with the Texans. The contract stated that Harris was unique. The court said that that was only a matter of opinion and not a material fact. They also said that the evidence for uniqueness was too narrowly defined. Rule- A clause in a contract enjoining a party from performing for others will be enforced if the breaching party possesses exceptional and unique knowledge, skill, and ability in performing the service called for in the contract

Answer 2

, John Dodds (defendant) drafted a document that stated his willingness to sell a piece of property to George Dickinson (plaintiff). The document stated that the offer would be open until 9:00 a.m. on June 12, 1874. On Thursday, June 11, Dickinson was informed by his agent that Dodds had changed his mind and actually intended to sell the property to Thomas Allen (defendant). Dickinson immediately went to the home of Dodds’s mother-in-law, where Dodds was staying, and dropped off a document expressing his intent to accept Dodds’s offer to sell the property. Dodds never received this document from his mother-in-law. At 7:00 a.m. on the morning of June 12, Dickinson and his agent both found Dodds at a train station and provided him with duplicate copies of the document accepting Dodds’s offer to sell. Dodds stated that it was too late and he had already sold the property to Allen. Dickenson filed suit for specific performance. The court held that Dodds has validly revoked his offer because there had been no meeting of the minds between the parties, and that Dodds had already decided to sell to Allen instead before he had received Dickinson’s acceptance. It does not matter that Dodds did not communicate his changed state of mind to Dickinson through an express or actual statement, as Dickinson could sufficiently infer this fact through Dodds’s conduct. Rule- An offer may be revoked by the offeror without an express or actual statement of revocation communicated to the offeree provided there has been no meeting of the minds and the offeree is aware of conduct by the offeror demonstrating intent to revoke the offer.

Answer 3

Embry was hired by Dry goods company under a one year employment contract. Embry stated that he informed McKittrick that if his contract was not renewed, he would leave his position. Embry states that in response to his statement, McKittrick assured him to go about his business without worry. Embry indicated he relied on this statement as a manifestation of intent by McKittrick to reemploy him for an additional year. The court held that Regardless of the parties’ subjective or actual intent, if a reasonable man could infer from their conduct intent to enter into a binding and enforceable contract, a binding and enforceable contract is presumed to exist.

Answer 4

Zehmer and Lucy were drinking alcohol in a bar and spent 40 minutes discussing and creating a contract for Lucy to buy Zehmer’s farm. Zehmer and his wife signed it, but when Lucy tried to gain title Zehmer said it was intended to be a joke. The court held that it does not matter that his subjective desire was that the agreement should be a joke, as this was never communicated to Lucy. Rule- The objective, outward expression of a party’s intent to be bound in an agreement, as opposed to that party’s subjective mental assent to the agreement, is all that matters when determining the existence of a valid and enforceable contract.

Answer 5

The store made an offer that on a certain date 3 coats worth $100 would be sold on a first come first serve basis to three people for $1. When Lefkowitz came first, the store refused to sell him the coat. The court held that the advertisement by the store for the lapin stole was clear, definite, and explicit, and it left no terms open to negotiation. Rule- An advertisement constitutes a binding offer if it is clear, definite, and explicit, and leaves nothing open for negotiation

Answer 6

Pepsico put out a commercial/advertisement telling customers to earn Pepsi points to buy various things, including an expensive jet. Leonard earned the points and went to get a jet, and Pepsico said it had been a joke. - The court ruled in favor of Pepsi because no reasonable person standing in the shoes of the recipient would have understood that commercial to be a valid contract

Answer 7

Harsh created an offer to negotiate about seeds.Rule- Acceptance of a proposal to begin bargaining cannot create a contract, even if the proposal was sent to specific persons, rather than to the public generally

Answer 8

Empro drafted a letter of intent to purchase Ball-Co’s assents and plant, which was signed by both parties. The letter of intent provided general terms and conditions and stated that the agreement in the letter was subject to a later agreement. The court held that this was not a binding contract because the terms were not specific enough and it was subject to a later agreement. Rule- Both parties’ objective manifestations of intent to be bound must be shown for a binding contract to be formed.

Answer 9

Arnold and Fuqua created a memo of intent to create a corporation with varying interest. Before the final agreement Fuqua terminated the negotiations. Here, the court said that there was a genuine issue of material fact as to whether this memo of intent reflects intent by the parties to be bound in a contract. This is because the memo of intent was not general like Empro, it was specific and contained all the essential elements of a contract

Answer 10

Ardente responded to home offer with further requirements that certain items stay in the house with them. Ardente’s letter of acceptance is conditional and thus operates as a rejection of the Horans’ offer that is incapable of creating a valid contract.

Answer 11

Step Saver places several orders with Wyse Technology via phone. Then they send the written purchase order, then they receive the shipment order along with an invoice. At this point the offer and acceptance is a complete match. Things go wrong when in that box is a shrink-wrap license with a warranty or merchantability in it, which Step Saver had refused to sign. The court held that under UCC § 2-207, if one party sends a written confirmation of the parties’ agreement, but that writing contains new terms, the writing may be either (1) a conditional acceptance of the contractual offer, meaning the sending party agrees to be in a contract only if the contract contains the new terms, or (2) a proposal to add the new terms to the parties’ existing contract. Here the court held that the shrink wrap license was not a conditional agreement because defendant had never stated that they would not continue in the agreement if these terms were not met

Answer 12

ProCD (plaintiff) sells a software product known as its SelectPhone database. The product consists of a detailed address directory and is sold to both commercial and non-commercial users. To make more profit, ProCD engages in price discrimination by charging a higher price for commercial users. It enforces its price discrimination scheme by including a license within the software package that limits use of SelectPhone to non-commercial purposes. The license terms are printed in the manual located inside the SelectPhone software packaging, and also pop up on the computer screen whenever the product is run. Matthew Zeidenberg (defendant) purchased SelectPhone and ignored the license agreement. He started his own company to sell the information contained in SelectPhone to commercial users at a cheaper price than that charged by ProCD. Zeidenberg claims that the license package is not enforceable. The court holds that the license was an enforceable contract. Rule- Shrinkwrap licenses included within a product’s packaging are enforceable unless their terms are objectionable on grounds applicable to contracts in general, such as violating a positive rule of law or being unconscionable.

Answer 13

Exact same facts as Pro CD but with a written agreement inside a computer box with 30 days to return it. Rule- Under the Uniform Commercial Code, a purchaser may be bound to terms included in product packaging if the purchaser has an opportunity to review the agreement and reject it by returning the product.

Answer 14

Minority jurisdiction for battle of the forms. Only one form necessary. Klocek ordered a computer from Gateway, and Gateway had a standard term of agreement on the front of the computer that said that if the customer did not return within five days that they agreed to the terms in the agreement. The court held that section 2-207 applies even though Standard Terms included in the package was the only form involved in the transaction. The Standard Terms constitute Gateway’s acceptance of the offer. It is not a counter-offer because Gateway’s acceptance was not made conditional upon Klocek’s consent to the additional terms. Moreover, the additional terms in the Standard Terms are not enforceable because Klocek did not expressly agree to them. Rule- Additional or different terms provided in the acceptance do not become terms of the contract unless acceptance is made expressly conditional upon acceptance of the additional terms or the non-merchant offeror expressly agrees to the additional terms.

Answer 15

White sent an estimate for work done on Corlies’ office. Corlies sent back a copy of it with slight adjustments, and then sent White a letter that upon this agreement White could start work at once. White purchased supplies and prepared for the work. The next day Corlies retracted the previous letter. The court held that White had not communicated his acceptance to Corlies by performance because Preparatory steps, such as the purchase of materials or preparation of those materials, do not clearly communicate to the offeror that performance has been commenced, because those materials could be purchased for many other purposes unrelated to the agreement between the parties. Rule- To form a binding contract, acceptance by performance must be sufficient to manifest or communicate the acceptance to the offeror.

Answer 16

The owners of Carbolic Smoke Ball Co. (Carbolic) (defendants) manufactured the Carbolic Smoke Ball and advertised it as a preventative measure against influenza. Carbolic placed an advertisement in several London newspapers saying that 100 pounds would be paid to any person who purchased a Carbolic Smoke Ball and still contracted influenza. The advertisement further stated that Carbolic had deposited 1,000 pounds in a local bank to demonstrate its seriousness in the matter. Carlill (plaintiff) purchased a Carbolic Smoke Ball and later contracted influenza despite using the ball as directed by Carbolic’s instructions. Carlill brought suit to recover the 100 pounds. The court held that by stating that it had deposited 1,000 pounds in a local bank to prove its seriousness in the matter, Carbolic clearly made an offer that was capable of being accepted by any person who bought a Carbolic Smoke Ball, used it as directed, and contracted influenza. Carlill accepted this offer by fulfilling the advertised condition. This acceptance does not fail simply because Carbolic only received notification of the acceptance with notification of the condition’s fulfillment. Advertisements with notice are treated differently. Rule- A general advertisement of an award constitutes an offer that is capable of being accepted and binding the offeror in a valid contract, provided at least contemporaneous notice and some consideration are present.

Answer 17

Petterson owned a property upon which the defendant owned a bond secured by a mortgage. The mortgage was payable to the defendant in quarterly installments, but the defendant offered to grant Petterson a $780 reprieve on the total mortgage if he paid it off in full by a certain date. Petterson went to defendant’s house with cash prepared to pay off the entire mortgage before the date. Before Peterson tendered any money, the defendant informed him that he had sold the mortgage to a third party and thus revoked his offer. The court held that an offer to enter into a unilateral contract may be withdrawn before the act requested to be done has been performed, even if the offeror knows of the offeree’s intention to accept and revokes at the very last second before acceptance Even though Petterson had money in hand and the defendant knew he was going to perform his end of the agreement, the revocation was still done before Petterson tendered the money and so is valid

Answer 18

The plaintiff shipped eel skins to the defendant and the defendant kept the skins for several months without notifying the plaintiff of whether the defendant had accepted and agreed to pay for the shipment. The skins were eventually destroyed because of this delay. Previously, the plaintiff had shipped skins in the same manner to the defendant about four or five times, and the defendant accepted and paid for the shipment each time. The court held that because of the prior sales between the parties, it was implied that the defendant had to respond to the plaintiff with a rejection if the defendant did not want the skins and was thus rejecting the offer. Rule- Conduct which looks like acceptance is acceptance.

Answer 19

Uncle promises nephew $5,000 on his 21st birthday if he refrains from drinking and using tobacco. Uncle never paid nephew and dies. The court holds that the fact that Willy gave up some of his rights for this promise is a detriment. He could have been doing all of those things, but he chose not to. The voluntary giving up of your own rights constitutes adequate consideration

Answer 20

HEM said that if you submit to our experiment, we will give you a year’s supply of Ampligen at no charge. The court held that they incurred the detriment of being tested upon for HEM’s studies in exchange for the promise of a year’s treatment of Ampligen. Upon completion of the double-blind tests, there was a binding contract.

Answer 21

Mills took care of 25-year-old Levi while on a voyage, but Levi died from his illnesses. Wyman, Levi’s father promised to pay Mills for the expenses Mills incurred while taking care of Levi. However, Wyman later refused to pay. The father incurred a detriment by offering to pay for the care and gave a benefit to the good Samaritan. The good Samaritan did not incur an additional detriment or benefit because it was all about past acts. The good Samaritan had already taken care of the boy. The father’s moral duty to take care of his child is not enough to be a bargained for consideration for the plaintiff’s past acts of generosity in caring for his ill son. It is more like a gift. The court limits the application of moral consideration to cases in which a moral obligation had existed.

Answer 22

Webb saved McGowin’s life by falling with a brick at a lumber mill, keeping it from hitting McGowin but leaving him permanently injured. McGowin promised to pay Webb every two weeks, and he did until he died. But his estate refused to continue this promise. The court held that McGowin received a material benefit when Webb saved McGowin from grievous harm, likely serious injury or death. McGowin acknowledged this benefit, promise to pay Webb for the remainder of his life, and did so until his death eight years later. Webb suffered severe bodily injuries from his actions undertaken to save McGowin’s life. Thus, McGowin’s promise to pay biweekly payments to Webb is a valid, enforceable contract and is not barred by the statute of frauds. Rule- If a promisee confers upon a deceased promisor a benefit that is material and substantial and that is conveyed upon the person of the promisor and not merely his estate, the promisee is entitled to recognition and compensation from the promisor’s estate either by an executed payment or an executory promise to pay.

Answer 23

Alaska Packers hired fishers to sail between San Franciso and Alaska and catch salmon for $50 and $60 and two cents per salmon. The fishermen went on strike and demanded $100, so Alaska Packers signed a new contract agreeing to the price but failed to pay it. The court found for the company because there was no consideration with the new contract because the fishers were not actually incurring any other detriment or benefit other than what they were already obligated to do. Rule- If parties enter a new agreement under which one party agrees to do no more than he was already obligated to do under an existing contract, the new agreement is unenforceable for lack of consideration.

Answer 24

The plaintiff was assigned a contract to construct a post office building. The plaintiff then entered into a subcontract with the defendant to perform all excavation necessary to complete the job. The defendant started work, but encountered considerable rubble where he was excavating and had to excavate much more than was contemplated in the contract. The rubble was not known or anticipated by the plaintiff or the defendant at the time they made the contract, and the labor and cost to remove it was not included in the contract. The parties orally agreed that the defendant would get rid of the discovered rubble in exchange for an increased contract price. However, eventually the defendant stopped work and refused to continue. The plaintiff brought suit. The court held that the agreement was legally binding because the rubble was unforeseen by both parties at the time of the contract, and it would have been a substantial burden to the defendant to remove it. Rule- When an unforeseen, burdensome condition arises during the performance of a contract, the promise of additional compensation in return for the promise to do the additional work is a separate, valid agreement.

Answer 25

The employer orally agrees to keep Dyer employed for the rest of his life so longas he did not sue them for personal injury for the loss of his foot at work. Dyer was later laid off and sued. The court held that further evidence was needed but talked about the two approaches. Rule- Forbearance from filing an unmeritorious legal claim that the party in good faith believes is valid constitutes sufficient consideration for a settlement agreement.

Answer 26

Scothorn quit her job and left her profession as a bookkeeper after her grandfather gave her a promissory note promising to pay her $2,000 on demand and 6 percent annual interest. At the time of giving her the note, her grandfather stated that he did not want his grandchildren to work, and upon receiving the note, Scothorn quit her job. He did not pay it all before his death and his executor refused. The court held that the grandfather He must have known that in giving Scothorn the promissory note, she was likely to give up her employment and leave her profession in reliance on the promissory note. Rule- Equitable estoppel prevents a promisor from revoking an otherwise unenforceable gratuitous promise if the promisee foreseeably and reasonably relied on the promise to her detriment. They used equitable estoppel here but applied principals of promissory estoppel

Answer 27

Frank Greiner was disinherited by his father. When Frank’s brother died, their mother, Maggie Greiner (plaintiff), inherited considerable property from the brother. Maggie wanted to use some of that property to place Frank on equal footing with her other sons who had not been disinherited by the father. Maggie promised Frank that if he moved back to the county where Maggie lived, then she would give him land for a home. He packed up and moved and made considerable improvements to the land. Maggie never made a deed and later sued Frank for recovery of the property. The court held that , promissory estoppel renders the promise binding. Maggie should reasonably have expected her promise to induce Frank to move and establish himself on the 80-acre tract, which he did. He also reasonably relied on Maggie’s promise when making improvements to the property and incurring expenditures. Further, the trial court could reasonably conclude that requiring Maggie to execute the promised deed in Frank’s favor was necessary to avoid injustice.

Answer 28

Boys that were minors and unable to pay rent to the apartment that they signed a lease to. The court held that there was no necessity because the boys had homes to go back to.

Cases Flashcards

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