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Contracts > Contracts > Flashcards

Contracts Flashcards

1
Q

Goods are governed by what?

A

UCC

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2
Q

Services are governed by what?

A

Common Law

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3
Q

Has the offer been terminated – when does termination by operation of law occur?

A

(1) when the subject matter has been destroyed
(2) supervening illegality of subject matter of k
(3) death or insanity of either party

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4
Q

If governed by CL, and terms are different b/t forms/agreements, what governs?

A

Mirror image rule: acceptance of each and every term of the offer

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5
Q

If UCC, and acceptance adds terms, what is the general rule?

A

those terms are accepted

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6
Q

If UCC, and acceptance adds terms, when do they NOT become part of the contract?

A

(1) when they constitute a material alteration, (2) the offeror objects, (3) or the offer is limited to its terms

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7
Q

What are the methods of acceptance for (1) a bilateral contract? (2) unilateral contract? (3) UCC?

A

(1) either by (A) a promise to perform or (B) beginning of performance
(2) completion of performance constitutes acceptance of a unilateral contract; however, commencement of performance may make the k irrevocable
(3) a promise to ship or by a shipment of conforming or nonconforming goods (shipping nonconforming goods implies acceptance and breach)

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8
Q

What are the exceptions to the pre-existing duty rule? i.e. that past consideration is generally invalid?

A

(1) written promise to pay a time-barred debt
(2) new or different consideration promised
(3) ratification
(4) compromise of honest dispute
(5) good faith under Art. II
(6) unforeseen circumstances make modification equitable

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9
Q

What is the rule of mutual mistake?

A

Contract is voidable by adversely affected party if conditions met

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10
Q

What are the conidtions that must be met for mutual mistake to apply?

A

(1) mistake concerns basic assumption on which k was made, (2) mistake has material effect, (3) party seeking avoidance did NOT assume risk

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11
Q

What types of contracts must be in writing, i.e. Statute of Frauds?

A

MY LEGS

  1. Marriage – when marriage is the consideration
  2. Year - Promises that cannot be performed w/i 1 year
  3. Land - Promises creating interest in land
  4. Executors – promises to pay estate debts from own funds
  5. Goods - contracts for sale of goods for $500 or more (exception: specially made goods or goods accepted or paid for)
  6. Suretyship - promise to pay for the debt of another
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12
Q

Parol Evidence Rule

A

When parties make a writing, no other evidence is admissible, i.e. contemporarneous or oral

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13
Q

When can you admit supplement evidence? When the contract is only partially…

A

partially integrated

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14
Q

what is evidence of complete integration? type of clause

A

a merger clause

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15
Q

when may evidence outside the scope of the parol evidence rule be admitted?

A

(1) evidence concerning validity; (2) evidence used to interpret; (3) evidence showing true consideration paid; (4) evidence in action for reformation

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16
Q

What are the UCC/Art. 2 gap-fillers?

A

Price (reasonabe at time of delivery); Place (seller’s biz); time of shipment (reasonable); time for payment (upon receipt);

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17
Q

Who bears the risk of loss in noncarrier cases? (1) merchant seller and (2) nonmerchant seller?

A

Merchant seller - risk passes to buyer upon taking physical possession
Nonmerchant seller - risk passes upon tender of delivery

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18
Q

Who bears the risk of loss in carrier cases?

(1) in shipment contract?
(2) in destination contract?
(3) in FOB contract?

A

Shipment – risk passes on delivery to carrier;
Destination – risk passes on tender at destination;
FOB – risk passes on delivery to FOB location

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19
Q

What are the general warranties in a sale of goods?

A

title, against infringement, merchantability, fitness, express

20
Q

How can one discliam the implied warranty of merchantability?

A

Specific disclaimer must mention “merchantability” and if in writing must be conspicuous;

also can be disclaimed by “as is,” refusal to examine, or course of dealing

21
Q

How can one disclaim fitness for a particular purpose, specifically and generally?

A

Specifically, must be a conspicuous writing, such as “there are no warranties which extend beyond the description”
Generally, other UCC methods, including “as is/with all faults;” by examination or refusal to examine (where buyer got to examine the item so there is no warranty for any defect that a R examination would have revealed to her;” by course of dealing, course of performance, or usage of trade

22
Q

When are damages recoverable?

A

When they can be proved w/ R certainty and could not be avoided w/ R effort

23
Q

COMMON LAW: if there has been a MINOR breach, what occurs?

A

That means there has been substantial performance, so the aggrieved party must perform, but there is a right to damages

24
Q

COMMON LAW: if there has been a MAJOR breach?

A

Aggrieved party has no duty to perform, IMMEDIATE right to damages and other remedies

25
Q

UCC: what is the perfect tender rule?

A

The goods OR delivery fail to conofrm to the contract in ANY way; buyer may reject all, accept all, or accept any commecially fit units and reject the rest

26
Q

When the is the remedy of specific performance available?

A

If legal remedy/damages is inadequate, court may order breaching party to perform, land and rare or unique goods

27
Q

What are the damages awarded for a land sale contract breach?

A

Damage between contract price and fair market value

28
Q

Damages awarded for employment contracts: (1) ER breach? (2) EE breach?

A
  1. full contract price; 2. cost to replace EE
29
Q

What is the measure of restitution?

A

VAlue of benefit conferred; prevents unjust enrichment

30
Q

When can parties rescind a contract?

A
  1. mutual mistake of material fact;
  2. unilateral mistake that other party knew or should have known;
  3. extreme hardship,
  4. misrepresentation of material fact,
  5. duress, undue influence,
  6. illegality,
  7. incapacity,
  8. failure of consideration
31
Q

When can parties reform a contract?

A

[when the writing changes to conform to parties’ original intent if mutual mistake]
1. Mistake:
a. an agreement b/t the parties
b. an agreement to put the agreement in writing
c. a variance b/t the original agmt. and the writing
2. Misrepresentation
To qualify for reformation, the misrepresentation must relate to the content or the legal effect OF THE RECORD. If it goes to subject matter, then the k qualifies for rescission and damages.

32
Q

When does a 3rd parties’ rights vest?

A

When he manifests assent; brings suit to enforce thep romise; OR materially changes position in justifiable reliance

33
Q

What defenses can be raised against 3rd party?

A

Any defenses that could be raised against original party/promisee

34
Q

What is the general rule re: assignment of rights?

A

All rights are generally assignable

35
Q

When are rights not assignable?

A

When assigning such rights materially alters the obligor’s duty or risk or it is prohibited by law

36
Q

What is the effect of a contract provision prohibiting assignment?

A

Only bars the delegation of duties

37
Q

What are the implied warranties of assignment?

A

Assignor implied warrants that (1) she has made no prior assignments of the right at issue; (2) the right is not subject to limits or defenses other than those disclosed or apparent; (3) she will do nothing to defeat or impair the right

38
Q

Successive assignment of same right rules:

A
  1. Revocable assignment – subsequent assignee prevails

2. irrevocable assignment – first assignee has priority

39
Q

Delegation fo duties – what duties CN be delegated?

A

(1) personal judgement or skill; (2) special skill/trust, doctor/lawyer, (3) those restricted by contract; (4) those the performance of which by a delegate materially changes the obligee’s expectancy

40
Q

What is a noncarrier case/contract?

A

A contract in which the parties did not intend for the goods to be moved by carrier

41
Q

what are the general assumptions in a noncarrier case contract about the place of delivery?

A

in the absence of an agreement otherwise, the place of delivery is assumed to be the seller’s place of business, or if he has one, his residence.

42
Q

what is the general assumption in a noncarrier case about the tender of delivery?

A

the seller must give the buyer notice R necessary to enable her to take possession of the goods and tender must be at a R hour

43
Q

what is a carrier case shipment contract?

A

where parties have agreed that a third party will move the goods. Article 2 presumes a shipment contract when no specification in contract.

44
Q

what is expected in a shipment carrier case?

A

the seller DN need to see that the goods reach the buyer; risk of loss passes once goods tendered to carrier

45
Q

destination carrier case/FOB?

A

risk passes to buyer once they are delivered to the buyer’s particular destination, risk passes upon delivery

Contracts (2 decks)

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