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Flashcards in Contracts Deck (196)
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Article 2

Applies to the sale of goods (Moveable, personal property)


Common Law

Applies to any other Contract


Do the parties have to be merchants for Article 2 to apply?

No, just has to be a contract for a sale of goods


Mixed Contract (Goods and Services)

Which is more important? What item does she want and what’s being thrown in?
Whatever is more important apply law (good= article 2, class= common law)


Texas Essays on Contracts

No Common Law, UCC only


Texas Essays on Contracts Article 2A

Lease of goods


Express Contract

Created by the parties words (oral or written)


Implied Contract

Created by parties conduct



Legally enforceable agreement
- Not every agreement is enforceable


Restitution (Quasi- Contract)

Protects against unjust enrichment whenever contract law yields an unfair result.
- Restitution is remedy of last resort
- Recovery in restitution is reasonable value of benefit conferred, not contract price


Recovery in Restitution

Value of benefit conferred, not contract price


Bilateral Contract

Where an offer can be accepted I any reasonable way (flexible)


Unilateral Contract

Where an offer can be accepted only by performing (inflexible)
- Where offer says accepted only by performing
- Reward, Contest, Prize


Was there an offer?

A manifestation of an intention to be bound
- A possibility of contract formation


Advertisements in Contracts

Generally not an offer (no quantity term)
- Trade Journal is not an advertisement (broader communicating media)
- Exception: Where the advertisement specifics quantity, then ad is an offer


Open Price Term

Court will read in a reasonable price except for a contract involving sale of real property - - No price, read in
- Usually fair market value at time of contract


Quantity and Requirement Contracts, Article 2

- Quantity can be measure by buyers needs or requirements, don’t have to be a specific number
- Even if ordering in good faith buyer cannot take seller by surprise. Buyer won’t be able to make seller give. Any increase cannot be out of line with buyers prior requirements


When does an offer lapse?

an offer lapses after a stated term or after a reasonable time has passed
- Offer doesn’t last forever, lapses after reasonable time


What effect does revocation have on the offer?

An offer terminates when the offeror revokes the offer


When can an offer be revoked?

An offer can be revoked any time before acceptance


What are the two types of revocation

Direct Revocation, Implied Revocation


Direct Revocation

The offeror indicates directly to the offeree that he has changed his mind about the deal
- Doesn’t have to say “revoke offer” just something ot let offeree know that he has changed his mind


Indirect Revocation

The offerror engages in conduct that indicates he’s change his mind and the offeree is aware of the conduct
- Look Out: where offeror has made offer, sold to someone else, and then original oferee comes to accept offer. If offeree did not know about transaction the offer was not revoked. Need evidence that oferee knew about transaction, then offer will be revoked and won’t be able to accept



An option is a promise to keep the offer open that is paid for. Promise + $
- Offer cannot be revoked


Firm Offer

- Offer cannot be revoked
In a sale of goods (article 2), if a merchant promises in a signed writing to keep an offer open the offer is irrevocable
- Held open for 3 months, can’t contract for anymore time
- If time period not stated it will be for reasonable time not to exceed 3 months
- Look Out: where it’s just a writing to agree to sell something for certain price, won’t be a firm offer. Has to have a promise to keep offer open


Foreseeable reliance before acceptance

- Offer cannot be revoked
Offeror expects offeree to accept first and then rely
- Usually not foreseeable that this would be other way around
- Subcontractors know that contractors rely on their bids. Won’t need acceptance first


Starting to perform on a unilateral contract

- Offer cannot be revoked
- What if you did things in order to prepare but did not start? Mere Preparation does not make offer irrevocable under this exception. Have to actually started the contract job. (Could be foreseeable reliance though)


When is revocation effective?

When it's received (no mailbox rule)
- If person accepted before they received your revocation in the mail, have to accept because revocation only effective when received not sent


A revocation _______s an offer



What effect does a rejection have on an offer?

An offer terminates when the offeree rejects it