Consideration Flashcards
(22 cards)
Consideration
A contract is a (1) bargained-for (2) legal detriment. Generally to induce legal detriment the promissor must be aware anticipate request and rely upon it. To determine legal detriment the courts apply a three step test (1) First they will see if the promissor is seeking a legal detriment; a loss or a harm (2) If there has not been a legal detriment then the courts will determine if the promissor is seeking a legally recognized selfish benefit (3) If there is no benefit the courts will then determine if either party agreed to do something they were not other wise legally obligated to do or forebore from something they had a legal right to do.
2-209 (1)
An agreement modifying a contract within this article need no consideration to be binding
Defenses: Statue of Frauds 2-201(1)
States that a contract for the sale of goods (1) $500 or more is not enforceable unless there is (2) sufficient writing (3) indicate that a contract for sale has been made between parties and (4) signed by the party
R Terms
When determining terms in a contract, the court acknowledges four different types of terms: (1) express terms (2) implied terms (3) statutorily supplied terms and (4) court supplied terms. In determining the terms of this contract, I will analyze each of the terms within the contract by category, beginning with the express terms,
Express Terms
Express Terms are those written or orallly spoken between the parties that they intend to be the final expression on those terms
Was there intergration
A writing is intergrated when it constitutes the (1) final expression of (2) one or more terms of the (3) agreement
final expression i.e., a term that is in black and white on a record (paper or electronic)
one or more terms i.e., some or all
agreement i.e., a bargain of the parties in fact or inferred from other circumstances including course of performance, course of dealing and usage of trade
If there was, what are the integrated terms
Integrated terms are promises and condition made by either party to the contract
Is there a term outside of the intergration that a party is trying to bring in as part of the contract
A term outside of the integration is any term that is introduced prior to or during contract formation. Terms (1) outside the integration may be (2) written or (3) oral that were negotiated and agreed upon by both parties.
Outside the integration i.e., not in the record
written or oral i.e, by one of the party’s ink or the equivalent
negotiation and agreed upon by both parties i.e., a meeting of the minds where both the offeror and the offeree are present
Parole Evidence
Outside written terms are considered parol evidence when they are introduced pre-contract formation. Outside oral terms are considered parol evidence when they are introduced pre-contract formation or at the time of the contract formation. There are three ways a term can possess legal significance in a contract, The first way is through (1) terms prior to the contract. (2) ters added during the contract (3) terms added after the contract
Modification
Under Common law, to make a valid modification to a contract there must be new consideration for the additional terms added to the final agreement.
Under the UCC 2-209(1) agreed upon contract modificaiton does not need new consideration to be binding. (exception.)
what effect will the outside term have on the intergrated agreement if introduced?
The ability of a party to introduce an outside term depends on the effect the terms will have on the contract. A term that contradicts when it is a direct conflict with the express terms of the contract. Outside terms which add something to the contract bring something new to the integrated agreement that was not expressly written. Outside terms which explain clarify an ambuguity that otherwise was not expressly clear within the intergrated agreement.
Before determinin if outside terms wil contradict/add or explain the intergrated agreement I will now determine of the contrat has been fully or partially intergrated
R Outside terms which contradict may never be introduced within an intergrated term
Is the contract Fully or partially intergrated?
In order to determine whether an agreement is fully intergrated, courts look at the Totality of the Circumstances weighing various factors including (1) merger/intergration clauses (full) (2) the extent of the negotiations between the parties (3) the sophistication of the parties (full) (4) disclaimer clause (full) (5) the involvement of lawyers in the formation of the contract (full) and (7) whether the parties would have normally agreed on an additional term, but absent the agreement (UCC -full)
Implied Terms
Implied terms are those inferred from the particular circumstances of the parties and implied by the court which are based on unspoken understandings and expectations that each party brings to the transaction (use the ones that apply)
Statutory Terms
Statutorily-supplied terms could be of the following ()
Breach
A Breach occurs when a party fails to perform according to the terms of the contract. A breach can be either material or partial (substantial performance). A breach is a total breach when performance is not completed at the time when its due. The extent of the breach will determine its consequence, so it is important to determine if a party substantially performed or did not perform at all. UCC 2-508
A breach is any deviation from a promised performance by the given due date. It can be material or partial. A material breach occurs when a party has not substantially performed. The most efficient way to test for a breach is to determine whether a party has substantiallu performed to the terms of the contract. Factors that the court considers to determine substantial performance are (1) the harm to the injured party (2) if the injured party can be adequately compensated for their loss. (3) if the party will suffer forietfutre, (4) if the breaching party comports with standard of good faith and fair dealing (5) the likilihood of the breaching party to provide a cure.
Perfect Tender Rule
2-601: Under the Perfect Tender Rule, a breach occurs if the goods or the tender of delievery fails in any aspect to conform to the contract. The buyer may (a) reject in whole (reasonable time after deliever); (b) accept in whole; or (c) accept any commercial unit or units and reject the rest.
Alternative theories
Gift
No Gratituous intent here
Promissory Esstoppel
May, if Barbara proves she took action relying on Lights Galore promise, but there are no facts now.
Unjust Enrichment
No because neither party conferred a benefit on the other
Promises made for past benefits
No because neither part made a subsequent promise to pay the other
