Ch 1:Section 1 - Basis for Enforceable Contracts Flashcards
Contract
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 as a duty (Restatement 1)
Promise
A manifestation of intention to act or refrain from acting in a specified way, so made to justify a promisee in understanding that a commitment has been made; promise may be stated in words either oral or written, or may be inferred wholly or partly from conduct (Restatements 2&4)
Promisor
The person manifesting the intention; the person breaching the promise
Promisee
The person to whom the manifestation is addressed; the person whom the promise is breached against
Express Warranties
Any affirmation of fact or promise made by the seller to the buyer which relates to the good and becomes a basis of the bargain; any description of the goods which is made a part of the basis of the bargain; goods shall conform to the affirmation, promise, or description; statement of opinion or commendation does not create a warranty (UCC 2-313)
Warrant of Merchantibility
Suitable for purchase or sale;
1) pass without objection under the contract description
2) are fit for ordinary purposes for which such goods are used
3) run of even kind, quality and quantity
4) are adequately contained/packaged/labelled
5) conform to the promises or affirmations of fact made on the container/label
Merchant
A person who deals in goods of the kind; who by his occupation holds himself out as having knowledge or skill peculiar to the goods involved in the transaction
Goods
things which are moveable at the time of identification to the contract for sale
Sources of Contract Law
1) Case law (primary, stare decisis)
2) Restatement 2d (Secondary, persuasive)
3) UCC (primary, statutes; if the facts fit, the statute applies)
UCC Article 2
Governs sale of goods (NOT SERVICES); regardless of merchant or not.
Hybrid Contracts
Contracts with both goods and services;
what predominates the contract (in $$, time, …etc)
Common Law and the UCC
Common law supplements Article 2 of the UCC; Article 2 of the UCC replaces the common law
What Promises will the law enforce?
- Promises with moral components
- If the promisor intends the promise to be enforceable
- If the promisee is reliant upon the Promisor’s promise (restatement 90)
- if there is consideration attached to the promise
Restatement 90
a promise which the promisor should reasonably expect to induce action on the part of the promisee and which does induce such action is binding if injustice can be avoided only by enforcement of the promise. (A promise that the promisee acts on then the promisor breaches, the promisee relied on the promise)
