Flashcards in Contracts Deck (184)
What are the seven general issues?
"Armadillos from Texas play rap eating tacos"
* Applicable law
* Formation of contracts
* Terms of a contract
* Remedies for unexcused performance
* Excuse of nonperformance
* Third party problems
When you have a unilateral contract?
1) When there's an offer that expressly requires performance as the only possible method of acceptance.
2) reward prize or contest
When does Article 2 apply?
1) there's a sale
2) for tangible personal property
Only need the K to be $500 or greater for SoF. The rest of A2 applies even if K price is less than $500.
When the contract involves both goods and something covered under common law, such as real estate or services, what is the general rule?
More important part of the contract determines whether A2 or common law unless contract divides payment between sale of goods part (UCC governs) and rest (common law governs).
Bob agrees with Sam to buy Sam's car. Sam is also obligated to provide Bob with two lessons in parallel parking. Does A2 apply?
What is a contract?
A contract is
* an agreement
* that is legally enforceable.
What is an offer?
An offer is
1) a manifestation of intent to the offeree
2) to contract on the basis of sufficiently definite offered terms
3) that creates a reasonable expectation in the offeree that agreement thereto would bind the offeror to the promise, undertaking, or commitment.
Can there be an offer under common law without a price term?
Yes, except for real estate contracts, if parties intended to form a contract.
Can there be an offer under A2 without a price term?
Yes, the price will be a reasonable price at the time of delivery.
Can a communication from seller to a buyer relating to Seller's sale of her car to buyer be an offer if it provides for the sale "for a fair price?"
No. The material terms are too vague or ambiguous. The result would be the same as if the contract was for services, that is under common law.
Buyer offers to buy grits from seller for five years. There is no specific quantity term in the offer. It provides that the show purchase all its grits from Seller. Did buyer make an offer?
Yes. This is a requirements or output contract. Under article to requirements or output contracts are not vague or ambiguous and are valid. Look for the following words: all, only, exclusively, solely.
Under the requirements contract buyer buys 1000 pounds of Chris each of the first three years of the agreement. Buyers and orders 1020 pounds in the fourth year. What is the result?
Buyer can increase requirements so long as the increase is in line with prior demands. No unreasonably disproportionate limitation on increases.
What is the general rule and the three exceptions concerning whether an advertisement or price quotation is an offer?
An advertisement are price quotation is not an offer. Rather, it's an invitation to deal. There are three exceptions:
2) specifies quantity and expressly indicates who can accept. For example "one fur coat $10.00 first, first served."
3) price quote is sent in response to an inquiry
What are the four ways in which an offer can be terminated?
1. Lapse of stated or reasonable time
2. Death of a party prior to acceptance
3. Words or conduct of the offeror revoking the offer
4. Words or conduct of the offeree rejecting the offer
Seller offers to sell a car for $400. The offer fails to indicate how long the offer will be kept open. Can buyer accept the offer five years from now?
No. The offer has lapsed because a reasonable amount of time has passed.
True or false. Only the death or incapacity of the offeror made after the offer, but before acceptance, terminates the offer.
False. Death or incapacity of either party after the offer, but before acceptance, terminates the offer
How is an offer revoked?
1) a later unambiguous statement by the offeror to the offeree of unwillingness or inability to contract; or
2) later unambiguous conduct by the offeor indicating an unwillingness or inability to contract that the offeree is aware of.
O offers to sell B a car for 400. Next day, O makes the same offer to X. B learns that O made the offer to X. Is the offer to B revoked?
No. Multiple offers aren't a revocation; there's been no unambiguous communication to B revoking the offer.
What are the four situations where an offer cannot be revoked?
2) UCC firm offer rule
4) Unilateral contract
S offers to sell B her car for 400. B pays S 10 for S's promise not to revoke the offer for 6 months. Can S still revoke the offer? Why or why not?
Offer cannot be revoked because it's an option contract:
1) S promised to not revoke (or keep the offer open) and
2) the promise is supported by payment or other consideration.
Don't need to use UCC Firm Offer Rule where option is supported by consideration.
S, a used car dealer, offers to sell B a car for 400. The written offer is signed by S. Can S revoke? Why or why not?
S can revoke because the offer didn't include a promise not to revoke.
What is the UCC Firm Offer Rule?
An offer cannot be revoked for up to 3 months if
1) offer to buy or sell goods;
2) signed written promise to keep offer open; and
3) party is a merchant
S offers to sell B a car for 400. The written offer is signed by S and states it will not be revoked but doesn't state a time period. Can S revoke? Why or why not?
No under UCC Firm Offer Rule. Time kept open isn't necessary to state. Court will supply a reasonable time (not more than 3 months).
CSC is a diversified service company who is bidding (offer) on a contract to service the Dept of Ed using multiple subcontractors. Natec, a subcontractor submits a bid to CSC do to the cataloging work for 100k. CSC relies on Natech's bid in making its bid and is awarded the contract. Can Natech still revoke its bid?
No because CSC's reliance was
1) FORESEEABLE to Natech and
2) without Natech's bid, CSC will be DETRIMENTED
DoE opens a bid to run ERIC for one year 10m. DoE's offer states that it can only be accepted by complete performance for an entire year. CSC begins to hire staff. Can DoE revoke? What if CSC begins to actually run ERIC?
Yes. Although CSC has made preparations to perform, CSC hasn't actually begun to perform. Therefore, DoE can revoke. CSC may have a claim that it detrimentally relied on DoE.
There's still no contract until CSC actually completes the year. If CSC begins to run ERIC, DoE can't revoke. But CSC isn't bound to complete performance.
What is the unilateral contract offer rule?
The start of performance pursuant to an offer to enter into a unilateral contract makes that offer irrevocable for a reasonable time to complete performance.
A2 "merchant" definition
Anyone in business for:
2) confirmatory memos
3) firm offers
Merchant with respect to goods of the kind involved for implied warranty of merchantability.
X fills car at Y's gas station. T or F: X has made a quasi-contract with Y.
F. The parties have an implied contract: their conduct indicates that they asset to be bound. A quasi-contract is not a contract.
Difference between a contract which is void, voidable, and unenforceable.
Void: without legal effect from the beginning.
Voidable: one or both parties may elect to avoid by raising a defense that makes it voidable.
Unenforceable: otherwise valid contract that is unenforceable due to a defense extraneous to formation.