cont100fall Flashcards
(113 cards)
1
Q
Promise
A
a manifestation of intention to act or refrain from acting in a specified way, so made as to justify a promisee in understanding that a commitment has been made
2
Q
Promise Characteristics
A
Verbal or Conventional
Biding
Consensual
CAN involve an exchange, but is not necessary
3
Q
PROMISE CASE Embola v. Tuppela
A
Embola agreed to lend Tuppela $50 w/ the promise if Tuppela regained his property, Tuppela would pay Embola 10k. Tuppela’s guardian refused to pay.
It was not usury because there is a contingency - that amount was only payable IF something happens (loan to investment)
Lender’s have legal recourse to recoup lost funds is the payee does not repay.
4
Q
Usury
A
the practice of lending money with an illegally high interest rate
5
Q
Contract
A
a promise or a 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.
6
Q
Contract Enforcement Policy
A
helps to enforce promises in order to encourage the creation of economic surplus in non-simultaneous, voluntary exchanges and to avoid inequity.
7
Q
CONTRACT CASE Hawkins v. McGee
A
Dr. McGee preformed restorative hand surgery after promising “I will guarantee to make the hand a hundred percent perfect hand”
Damages were awarded for warranty breach of contract
8
Q
Contract Damages
A
Expectation Damages: non-breaching party same financial outcome as without breach
Reliance Damages: compensation for harm suffered; restores reliance party to pre-contract situation
Restitution Damages: gives back what was gained by breaching party for breach of contract
9
Q
Consideration
A
one method of deciding when a promise is legally enforceable.
Sec. 17 the formation of a contract requires a bargain in which there is a manifestation of mutual assent to the exchange and a consideration
10
Q
Gift
A
not a legally enforceable promise UNLESS an exchange is part bargain/part gift
11
Q
GIFT CASE Dougherty v Salt
A
D received promissory note from aunt ‘payable at her death’ containing text ‘for value received’ Executor refused payment due to lack of consideration. Court found lack of consideration b/c both parties did not agree to exchange
12
Q
Bargain Approach/ sec 71
A
Sec. 71: 1) to constitute consideration, a performance or a return promise must be bargained for; 2) a performance or return promise is bargained for if it is sought by the promisor in exchange for his promise and is given by the promisee in exchange for that promise.
13
Q
Benefit Detriment
A
requires a bargain to have been made AND the promisee’s consideration must result in a benefit to the promisor and/or a detriment to the promisee
Detriment: anything they are not legally obligated to do
14
Q
GIFT CASE: Hardesty v. Smith
A
H brought suit for failure to pay on promissory notes. S alleges promissory notes are worthless due to the lack of consideration.
ct found that while consideration given (the patent on the lamp) was of no value, there was still valid consideration since neither party to the contract was aware of the patent’s value at the time, and thus a contract was formed.
15
Q
Enforceable Contract/Conditional Gift
A
Sec. 79 if the requirement of consideration is met, there is no additional requirement of a) a gain, advantage, or benefit to the promisor or a loss disadvantage, or detriment to the promisee; or b) equivalence in the values exchanged; or c) mutuality of obligation
16
Q
CONDITIONAL PROMISE CASE: Iacono v. Lyons
A
lyons invited Iacono to vegas under the pretense of splitting 50-50 all winnings, courts found the mutual agreement to share winnings 50-50 was a mutual obligation by the parties to the agreement will furnish sufficient consideration to constitute a binding contract.
17
Q
Unilateral Contract
A
when the only consideration for a promise is the act itself; a contract only creates an obligation on one side.
rewards and prizes, insurance
18
Q
Bilateral Contract
A
consideration for promise is either promise of performance OR performance; this creates an obligation on both sides
19
Q
BARGAINED FOR CASE Kirksey v Kirksey
A
BIL wrote to ask SIL if she would come see him then he would let her have a place to raise her family, after two years he removed her from the property. Court found it lacked consideration that this constituted a gratuitous promise
20
Q
Implied Promise sec.4; sec 77
A
sec.4: a promise may be stated in words either oral or written, or may be inferred wholly or partly from conduct
sec77: a promise or apparent promise is not consideration if by its terms the promisor or purported promisor reserves a choice of alternative performances unless a) each of the alternative performance would have been consideration if it alone had been bargained for; or b) one of the alternative performances would have been consideration and there is or appears to the parties to be a substantial possibility that before the promisor exercises his choice events may eliminate the alternative which would not have been consideration.
21
Q
IMPLIED PROMISE CASE Wood v. Lucy, Lady Duff-Gordon
A
Lucy has an exclusive deal with Wood to promote her products in return for percent of revenues. Wood alleges Lucy violates contract by placing endorsement on products w/o his consent. Lucy alleges no contract exists b/c she has no means to compel him to preform.
22
Q
3 types of implied contracts
A
Implied in fact
Obligations can be implied
unspoken assumptions
23
Q
Implied in Fact contracts
A
there is an actual (in fact) but unspoke or unwritten agreement; contractual exchange implied by parties behavior
24
Q
Obligations can be implied
A
requires drawing inferences from language used in contractual agreement
25
unspoken assumptions
unspoken assumptions that underlie all human communications; usually pass unnoticed
Implied terms are as binding as express ones
26
Illusory Promise sec.2
something that looks like a promise but isn't
sec.2 (e): words of promise which by their terms make performance entirely optional with the promisor whatever may happen, or whatever course of conduct in other respects he may pursue, do not constitute a promise
not a promise, therefore cannot be breached
cannot count as consideration
27
Pre-existing duties sec 73
sec 73: performance of a legal duty owed to a promisor which is neither doubtful nor the subject of honest dispute is not consideration; but a similar performance is consideration if it differs from what was required by the duty in a way which reflects more than a pretense of a bargain.
28
Pre-Existing Duty sec.74
1) Forbearance to assert or the surrender of a claim or defense which proves to be invalid is not consideration unless a) the claim or defense is in fact doubtful because of uncertainty as to the facts or the law, or b) the forbearing or surrending party believes that the claim or defense may be fairly determined to be valid.
2) The execution of a written instrument surrendering a claim or defense by
one who is under no duty to execute it is consideration if the execution of the
written instrument is bargained for even though he is not asserting the claim
or defense and believes that no claim or defense exists.
29
Pre-Existing Duty sec 89
A promise modifying a duty under a contract not fully performed on either
side is binding (a) if the modification is fair and equitable in view of
circumstances not anticipated by the parties when the contract was made; or
(b) to the extent provided by statute; or (c) to the extent that justice requires
enforcement in view of material change of position in reliance on the
promise
30
Pre-Existing Duty Rule
An agreement modifying a contract is
not supported by consideration if
one of the parties to the agreement
does or promises to do something
that he is legally obligated to do or
refrains or promises to refrain from
doing something he is not legally
privileged to do.
31
Pre-Existing Duty CASE: Angel v. Murray
Residents sued city to recoup increase in fees for garbage collection that were renegotiated as a mod to an existing contract. ct found an exception to the pre-existing duty applies if there are unforeseen circumstances and the contract has not been fully preformed
32
Promissory Estoppel sec. 90
A promise which the promisor should resonably expect to induce action or forbearance on the part of the promisee or a third person and which does induce such action or forbearance is binding if injustice can be avoided only by enforcement of the promise. The remedy granted for breach may be limited as justice requires.
When promisor should reasonably expect to induce action, and does induce action, promise is binding. Induced action/forbearance is consideration for promise.
33
PROMISSORY ESTOPPEL CASE: Feinberg v Pfeiffer
Feinberg worked for Pfeiffer whose board voted to grant Feinberg $200/month for life in retirement to begin whenever Feinberg began retirement. In reliance on that guarantee, Feinberg chose to retire. Pfeiffer's future board reduced the payments considering them a gift. Ct found for Feinberg based on promissory estoppel.
34
PROMISSORY ESTOPPEL CASE: Conrad v. Fields
Fields suggested Conrad quit her job and attend law school and that Fields would pay cost of tuition and books. She does so and Fields eventually stops payment. Ct finds for Conrad based on promissory estoppel.
35
3 Elements for Promissory Estoppel
A promise
Reasonable reliance on the promise
Enforcement of promise prevents injustice
this policy is required to prevent people from taking back promises on which people have substantially relied upon and which would cause harm to not enforce.
36
Pre-contractual Promissory Estoppel
reliance serves as a substitute for consideration
37
Pre-contractual Promissory Estoppel CASE: Neiss v. Ehlers
Neiss entered into employment contract with Ehlers which was stipulated on her gaining ownership shares of company at future data. She relied on this guarantee as part of agreement to relocate for new job. Never received shares. Ct reasons that this agreement to agree can serve as basis for reliance and promissory estoppel allows for recovery of reliance damages.
38
Pre-contractual Promissory Estoppel CASE: Garwood Pkg, INC v. Allen & Co
GPI is in debt and looks to Allen for investment. Allen's employee states he will get investment deal done. come hell or high water. Things go south and GPI sues for reliance damages. Ct reasons that sophisticated parties have a higher bar for promissory estoppel and should have known this was just an expression, not a promise to perform.
39
Reliance Damages
loss incurred by promisee reasonably relying on the promisor's promise.
40
Spotting Issue's with Promissory Estoppel
one party has suffered loss b/c of another's breach of promise
if there is definitely a bargain contract, no promissory estoppel
if there is doubt about whether an enforceable contract was formed OR clear it wasn't formed, promissory estoppel analysis necessary.
41
Restitution/To establish
Third and final method of contract enforcement; to prevent one party from being unjustly enriched at another's expense.
the defendant has benefited
At the plaintiff's expense
That equity and good conscience require restitution
42
Restitution CASE: Tasini v. AOL
Tasini sued AOL claiming they were unjustly enriched and Tasini was deceptively denied compensation for submitting content to website. Ct finds for AOL b/c complain did not demonstrate that principles of equity and good conscience required restitution since it was clear upon submission that they would not receive monetary compensation.
43
Restitution in Family Relationships
Must show both parties understood that promisee would compensate AND promisee must have had the option of rejecting the benefit.
44
Family Restitution CASE: In re Estate of Zent
Johnson was partner to Zent and when his health deteriorated behaved as his caregiver. Had valid claim for restitution because she was not legally family and thus was not unjustly enriched by receiving compensation for the services provided.
45
Restitution: Gift Principle
a person given the gift is enriched by not unjustly; giver is a volunteer
46
Restitution: Choice Principle
recipient has to have a choice of keeping or paying; giver cannot be an intermeddler.
47
Restitution: Contract implied-in-law/quasi contract
not an actual contract but creates an obligation imposed by law to do justice even though to promise was made or intended.
48
Formation of Contracts by Offer and Acceptance secs
sec17, sec 18, sec 19, sec 20, sec 22, sec 24, sec 50
49
Offer/Acceptance CASE: Konic Int. v. Spokane Computer Services
Konic salesman quoted "fifty six twenty" as cost for product. Amount was interpreted as $56.20 but meant as $5,620. There was no meeting of the minds as to a material term of the contract therefore no contract was formed.
50
Offer/Acceptance CASE: Frigaliment Importing Co v. International Sales
Seller and buyer had different definitions of chicken. Ct looked to multiple sources to define because neither party could agree on the def in good faith. First, course of dealing, then trade usage, then course of dealing.
51
Offer/Acceptance Case: Courteen Seed v Abraham
two parties had exchanged telegrams regarding the price of seed. P alleges an offer was made which he accepted. Ct determined the language did no constitute express conveyance of an offer. Invitation to negotiate not the same as an offer
52
Offer/Acceptance CASE: Ardente v. Horan
P were purchasing D house but in acceptance requested additional items to be included. D refused to sell. Ct determines the P response did not constitute acceptance so as to form a contract b/c it added additional terms (counter offer) and did not clearly separate additional terms from acceptance of original offer.
53
Offer
the manifestation of willingness to enter into a bargain, so made as to justify another person in understanding that his assent to that bargain is invited and will conclude it.
54
Acceptance
a manifestation of willingness to enter into a bargain, so made as to justify another person in understanding that his assent to that bargain is invited and will conclude it.
55
Offer/Acceptance Objective Standard
Have the parties entered into a contract
When did the contract form
56
O/A Objective Standard CASE: Embry v. Hargadine
Embry's contract up for renewal, in contract w/ company president re contract he stated Embry was "good to go" and not to worry about contracts. Embry was discharged after a few months' work. Ct found this could be interpreted as offer w/ subsequent acceptance by Embry DUE TO THE NATURE OF THE CONDUCT OF THE PARTIES. Intentional to actually form a contract is irrelevant.
57
O/A Objective Standard CASE: Taylor v. Canteen Corp
Taylor was union employee w/ seniority and job security. Accepted promotion that removed union protections on statements of "nothing to worry about" and he should "not be concerned about job security" subsequently forced to retire. Ct found these statements were insufficient to constitute offer b/c they were clearly STATEMENTS OF HOPE FOR THE FUTURE. Also failed on promissory estoppel claim due to LACK OF VALID PROMISE
58
Termination of Offer/Power of Acceptance and Option Contracts secs
sec 36, sec 37, sec38, sec 39, sec 40, sec 42, sec 43, sec 63, sec 87
59
Unilateral Contracts
Require specific performance by the offeree to constitute acceptance.
Typically only valid for prizes/rewards/when offer expressly requires performance as the only means of acceptance
Beginning performance also does not qualify as acceptance in unilateral contracts
If offeror revokes the offer, there is no remedy, even if the offeree has began performance (possibly more to look into)
Only 1 way to enter into valid contract. MOST contracts are not unilateral.
60
UCC Offer and Acceptance 2-206
Unless otherwise unambiguously indicated by the language or circumstances:
an offer to make a contract shall be construed as inviting acceptance in any manner and by any medium reasonable to the circ.
an order or other offer to buy goods for prompt or current shipment shall be construed as inviting acceptance either by a prompt promise to ship or by the prompt or current shipment of conforming or nonconforming goods, but such a shipment of non-conforming goods does no constitute an acceptance if the seller seasonably notifies the buyer that the shipment.
Where the beginning of a requested performance is a reasonable mode of acceptance, an offeror who is not notified of acceptance within a reasonable time may treat the offer as having lapsed before accepted.
61
UCC differs from Common Law
acceptance can be completed in ANY reasonable manner
statue defines which methods of acceptance are proper
62
UCC 2-204
A contract for sale of goods may be made in any manner sufficient to show agreement, including conduct by both parties which recognize the existence of such a contract.
an agreement sufficient to constitute a contract for sale may be found even though the moment of its making is undetermined
even though one or more terms are left open a contract for sale does not fail for indefiniteness if the parties have intended to make a contract and there is a reasonably certain basis for giving an appropriate remedy.
Even if an exact date of agreement is unknown, a contract can be formed by parties' actions.
63
UCC 2-209
An agreement modifying a contract w/in this article needs no consideration to be binding.
a signed agreement which excludes modification or rescission except by a signed writing CANNOT be otherwise modified or rescinded, but except as between merchants such a requirement on a form supplied by the merchant must be separately signed by the other party.
requirement of the statute of frauds section of this act must be satisfied, if the contract is modified w/in its provision
an attempt at mod or rescission that does not meet 2 or 3 can operate as a waiver
a party who has never made a waiver affecting an executed portion of the contract may retract the waiver by reasonable notification received by the other party that strict performance will be required of any terms waived, unless the retraction would be unjust in view of material reliance on the waiver
64
Offertory Estoppel sec 32
sec 32: in case of doubt an offer is interpreted as inviting the offeree to accept either by promising to perform what the offer requests or by rendering the performance, as the offeree chooses.
Acceptance by promise to perform usually occurs when there is an element of time (the promise need not occur immediately)
language can limit acceptance to performance specifically
UCC 2-206 sets out own restatement for commercial goods
65
Offertory Estoppel sec 45
when an offer invites an offeree to accept by rendering a performance and does not invite a promissory acceptance, an option contract is created when the offeree tenders or begins the invited performance or tenders a beginning of it
the offeror's duty of performance under any option contract so created is conditional on completion or tender of the invited performance in accordance with the terms of the offer.
Protects offeree in justifiable reliance
the reservation of a right to revoke a promise means no promise or offer was made
Most cases, the beginning to perform carries the implied promise to complete performance.
The offeree is NOT bound to complete the promise
the offeror IS bound, contingent on offeree's performance
beginning preparations to begin performance does NOT constitute beginning performance
66
Offertory Estoppel sec 87 (2)
An offer which the offeror should reasonably expect to induce action or forbearance of a substantial character on the part the offeree before acceptance and which does induce such action or forbearance is binding as an option contract to the extent necessary to avoid injustice.
67
Offertory Estoppel CASE: Drennan v. Star Paving
Drennan prepared bid for construction contract utilizing subcontractor bid prepared by defendant. Upon acceptance of construction contract, D then refused to complete project for agreed price. Drennan had to find new subcontractor at high price. Ct found the offer qualified as a promise to perform and def should have anticipated Drennan would rely on it therefore the offer was irrevocable.
68
Offertory Estoppel Considerations
Cts do not weigh adequacy of consideration - a statement in a written agreement of consideration given, constitutes evidence of the fact, whether or not the consideration was actually given.
Reliance is not the same as performance. An offeree may have to undertake significant expenses, or make commitments, in order to accept an offer - that is reliance
in these cases specific performance of offered contract is not necessary for restitution.
69
Commercial Contract Elements
Negotiation of Price
Other Aspects of the Agreement (timing, shipping, fees)
70
Commercial Contract CASE: Gardner Zemke v. Dunham Bush
Gardner submitted PO for equipment which contained warranty provisions and requirements product comply w/ specifications. Dunham responded w/ preprinted acknowledgement which had its own warranty and product description contradicting PO; never addressed by either party. Under common law mirror rule no contract is formed b/c the offers did not mirror each other like for like. Under UCC different terms are treated under the knock-out rule where both differing terms are removed from agreement and default UCC terms apply instead.
71
Knock-out Rule Exception
if the offeree made acceptance EXPRESSLY CONDITIONAL on the offeror's acceptance of the included new terms
for this to be true it must be clear the offeree would be unwilling to go forward with the transaction
72
UCC 2-207
A definite and seasonable expression of acceptance or a written confirmation which is sent within a reasonable time operates as an acceptance even though it states terms additional to or different from those offered or agreed upon, unless acceptance is expressly made conditional on assent to the additional or different terms
73
UCC 2-207 Additional Terms
are construed as proposals for additions to the contract. Between MERCHANTS, such terms become part of the contract unless: the offer expressly limits acceptance to the terms of the offer; they materially alter it; or notice of objection to them is given within a reasonable time after notice is received.
74
UCC 2-207 Conduct
Conduct by both parties which recognize the existence of a contract is sufficient to establish a contract for sale although the writings of the parties do not otherwise establish a contract. In such cases, the terms of the contract consist of those terms on which the parties agree; together with any supplementary terms included under any other provisions of this act
75
UCC 2-207 Section 2: different terms
limited to additional terms in majority of districts, they will treat different terms using the knock out rule and UCC terms will apply
Minority approach is to apply subsection 2
Knock-out rule is also applied under subsection 3, but only b/c no contract exists
76
Expressly conditional offers or acceptances
offeree is unwilling to proceed with the transaction
offeree clearly and unequivocally communicated this intent to offeror
commercial context (features of industry, prior relationship, etc.)
77
Rolling Contract Formation
Steps: purchase order; payment; delivery w/ terms, acceptance of items equates to acceptance of terms.
initial order and payment = contract formation
Delivery w/ terms and acceptance of product = finalization of contract
78
Rolling Contract CASE: Step-Saver Data Systems, Inc v. Wyse Technology (1991)
Step-saver purchased computer program from Wyse which subsequently malfunctioned. Wyse alleged no warranty existed b/c form language on box-top license excluded warranty provisions. Cts treated as rolling contract and under 2-207 the exclusion of warranty would materially alter the contract therefore the box-top license did not become part of the terms
79
Rolling Contact CASE: ProCD v. Zeidenberg
ProCD sold software under 2 different licenses (commercial and non-commercial). Non-commercial contained shrinkwrap license on outside of the package and within software that prohibited commercial use. Zeidenberg bought and resold non-commercial software. Ct held the shrinkwrape provided sufficient notice and provided for buyer to return the product if license was unacceptable, therefore it was an enforceable agreement
80
Electronic Contract Formation: Clickwrap/Scrollwrap
Review Notice: user is put on notice that there are certain terms they are agreeing to whether they choose to read them or not
Discerning the Agreement:
Sufficient notice; reasonable opportunity to reject; has the party manifested their acceptance/rejection
81
sec. 211(1)
Except as stated in subsection (3) , where a party to an agreement signs or otherwise manifests assent to a writing and has reason to believe that the writings are regularly used to embody terms of agreements of the same type, he adopts the writings as an integrated agreement with respect to the terms included in the writing.
Such writing is interpreted whenever reasonable as treating alike all those similarly situated, w/o regard to their knowledge or understanding of the standard terms of writing
where the other party has reason to believe that the party manifesting such assent would not do so if he knew the writing contained in a particular term, the term is not part of the agreement.
82
sec 211 applies to
paper contracts; terms in the box, shrinkwrap, keepwrap (don't like must return), clickwrap (i accept), browsewrap(hyperlink). Some documents are not obvious on their face a contract, but nonetheless are.
83
sec 211 terms
standardized terms can be overridden by pre-negotiated terms, are interpreted against the draftsman and are assumed to operate in good faith.
Courts generally interpret contract terms to favor a standard reader's interpretation.
Parties are not bound to terms which are beyond reasonable expectations.
84
Electronic Contract CASE: Darner Motor Sales v. Universal Underwriters Insurance
darner sued by lessee for damages arising during test drive. Darner believed insurance umbrella policy covered damage based on explicit conversations w/ Universal representative. Insurane did not cover damage of lessee. Ct found that where a party knows the other party would not consent to terms if he were aware of them, those terms do not apply to the agreement.
85
Contract Interpretation
Interpretation is the study of what agreement means; interpretation of a promise or agreement or a term thereof is that ascertainment of its meaning
Intent of the parties is essential.
86
Intention Sources
Intrinsic: written terms w/in the document(written terms; explicit references; reasonable common sense)
Extrinsic: relating to contract but not within the document itself (course of performance; course of dealing; usage of trade; preliminary negotiations)
Tools for interpretation: express terms, negotiating history, trade usage, common sense, course of performance
87
sec. 2-201
words and other conduct are interpreted in the light of all the circumstances, and if the principal purpose of the parties ascertainable it is given great weight.
A writing is interpreted as a whole, and all writings that are part of the same transaction are interpreted together.
Unless a different intention is manifests, where language has a generally prevailing meaning, it is interpreted in accordance with the meaning, technical terms and words of art are given their technical meaning when used in a transaction within their technical field.
where an agreement involves repeated occasions for performance by either party with knowledge of the nature of the performance and opportunity for objection to it by the other, any course of performance accepted or acquiesced in without objection is given great weight in the interpretation of the agreement.
whenever reasonable, the manifestations of intention of the parties to a promise or agreement are interpreted as consistent with each other and with any relevant course of performance, course of dealing, or usage of trade
88
sec 2-203
in the interpretation of a promise or agreement of a term thereof, the following standards of preference are generally applicable: an interpretation which gives a reasonable, lawful, and effective meaning to all the terms is preferred to an interpretation which leaves a part unreasonable, unlawful, or of no effect; express terms are given greater weight than course of performance, course of dealing, and usage of trade, course of performance is given greater weight than course of dealing or usage of trade, and course of dealing is given greater weight than usage of trade; specific terms and exact terms are given greater weight than general language; separately negotiated or added terms are given greater weight than standardized terms or other terms not separately negotiated.
89
Two kinds of Ambiguity
Patent Ambiguity: intrinsic evidence is obviously unclear or contradictory
Latent Ambiguity: extrinsic evd seems to contradict clear meaning courts can adopt objective (prioritizing intrinsic evd) or a subjective approach.
90
1-303: course of performance
"course of performance" is a sequence of conditions between the parties to a particular transaction that exists if:
the agreement of the parties with respect to the transaction invites repeated occasions for the performance by the parties; and the other party, with knowledge of the nature of the performance and opportunity for objection to it, accepts the performance or acquiesces in it w/out objection
91
1-303 course of dealing
course of dealing is a sequence of conditions concerning previous transactions between parties to a particular transaction that is fairly to be regarded as establishing a common basis for interpreting their expressions and other conditions.
92
1-303 usage of trade
any practice or method of dealing having such regularity of observance in place, vocation, or trade as to justify an expectation that it will be observed with respect to the transaction in question. The existence and scope of such usage must be proved as facts. If it is established that such a usage is embodied in a trade code or similar record, the interpretation of the record is a question of law.
93
Course of Performance
course of performance or course of dealing between the parties or any usage of the trade in the vocation or traide in which they are engaged or of which they are or should be aware is relevant in ascertaining the meaning of the parties' agreements, or qualify terms of agreement. A usage of trade applicable in the place in which part of the performance under the agreement is to occur may be so utilized as to that part of the performance.
94
sec 1-303 Except
Except as otherwise provided in subsection (f), the express terms of an agreement and any applicable course of performance, course of dealing, or usage of trade must be construed whenever reasonable as consistent with each other. If such a construction is unreasonable: express terms prevail over course of performance, course of dealing, and usage of trade; course of performance prevails over course dealing and usage of trade; course of dealing prevails over usage of trade
95
sec 1-303 other
subject to section 2-209, a course of performance is relevant to show a waiver or modification of any term inconsistent with the course of performance
evd of related usage of trade offered by one party is not admissible unless and until he has given the other party such notice as the court finds sufficient to prevent unfair surprise to the latter.
96
sec 17
the formation of a contract requires a bargain in which there is a manifestation of mutual assent to the exchange and a consideration
97
sec 18
manifestation of mutual assent to an exchange requires that each party either make a promise or begin or render a performance
98
sec 19
the manifestation of assent may be made wholly or partly by written or spoken words or by other acts or by failure to act
the conduct of a party is no effective as a manifestation of his assent unless he intends to engage in the conduct and knows or has reason to know that the other party may infer from his conduct that he assents
the conduct of a party may manifest assent even though he does not in fact assent. in such cases a resulting contract may be voidable because of fraud, duress, mistake, or other invalidating cause
99
sec 20
there is no manifestation of mutual assent to an exchange if the parties attach materially different meanings to their manifestations and a) neither party knows or has reason to know the meaning attached by the other; or b) each party knows or each party has reason to know the meaning attached by the other
the manifestation of the parties are operative in accordance with the meaning attached to them by one of the parties if a) that party does not know of any different meaning attached by the other and the other knows the meaning attached by the first party or b) that party has no reason to know of any different meaning attached by the other; and the other has reason to know the meaning attached by the first party.
100
sec22
manifestation of mutual assent to an exchange ordinarily takes the form of an offer or proposal by one party followed by an acceptance by the other party or parties.
Manifestation of mutual assent may be made even though neither offer nor acceptance can be identified and even though moment of formation cannot be determined.
101
sec 24
an offer is the manifestation of willingness to enter into a bargain, so made as to justify another person in understanding that bargain is invited and will conclude it.
102
sec 50
acceptance of an offer is a manifestation of assent to the terms thereof made by the offeree in a manner invited or required by the offeror.
acceptance by performance requires that at least part of what the offer requests be performed or tendered and includes acceptance by a performance which operates as a return promise
Acceptance by a promise requires that the offeree complete every act essential to the making of the promise.
103
sec 36
an offeree's power of acceptance may be terminated by a)rejection or counteroff by the offeree, or b) lapse of time, or c) revocation by the offeror, or d) death or incapicity of the offeror or offeree
as soon as an offeror makes an offer, a power of acceptance is created in the offeree. Can be terminated by one of the four methods specified above
104
sec 37
notwithstanding sec 38-49, the power of acceptance under an option contract is not terminated by rejection or counteroffer, by revocation, or by death or incapcity of the offeror, unless the requirements are met for the discharge of a contractual duty
105
sec 38
an offeree's power of acceptance is terminated by his rejection of the offer, unless the offeror has manifested a contrary intention
a manifestation of intention to not accept an offer is a rejection unless the offeree manifests an intention to take it under further advisement.
106
sec 39
a counteroffer is an offer made by an offeree to his offeror relating to the same matter as the original offer and proposing a substituted bargain differing from that proposed by the original offer
An offeree's power of acceptance is terminated by his making of a counteroffer unless the offeror has manifested a contrary intention or unless the counteroffer manifests a contrary intention of the offeree.
Counteroffer MUST be capable of being accepted; should not intend to continue negotiations; must be capable of ending them. Distinguished from inquiries as to possible term changes and addendums
can include the option to hold negotiations open while the original offer is on the table
107
sec 40
rejection or counteroffer by mail or telegram does not terminate the power of acceptance unless received by the offeror, but limits the power so that a letter or telegram of acceptance started after the sending of an otherwise effective rejection or counteroffer is only a counteroffer unless the acceptance is received by the offeror before he receives the rejection or counteroffer.
108
sec 42
an offeree's power of acceptance is terminated when the offeree receives from the offeror a manifestation of an intention not to enter into the proposed contract
most offers are revocable
explicit terms are not essential so much as clear intention to revoke
109
sec 43
an offeree's power of acceptance is terminated when the offeror takes definite action inconsistent with an intention to enter into the proposed contract and the offeree acquires reliable information to that effect
a revocation can be communicated either directly or indirectly
110
sec 63
unless the offer provides otherwise a) an acceptance made in a manner and by a medium invited by an offer is operative and completes the manifestation of mutual assent as soon as put out of the offeree's possession, without regard to whether it ever reaches the offeror; but b) an acceptance under an option contract is not operative until received by the offeror
Prevents offerees from revoking offers made via mail in bad faith
111
sec 87(1)
an offer is binding as an option contract if it a) is in writing and signed by the offeror, recites a purported consideration for the making of the offer, and proposes an exchange on fair terms within a reasonable time; or b) is made irrevocable by statute.
112
sec 63
unless the offer provides otherwise, a) acceptance made in a manner and by a medium invited by an offer is operative and completes the manifestation of mutual assent as soon as put out of the offeree's possession, without regard to whether it ever reaches the offeror; but b) an acceptance under an option contract is not operative until received by the offeror.
113
sec 62
where an offer invites an offeree to choose between acceptance by promise and acceptance by performance, the tender or beginning of the invited performance or a tender of a beginning of it is an acceptance by performance.
such an acceptance operates as a promise to render complete performance. beginning performance constitutes acceptance and both offeree and offeror are bound.
