Contracts & Sales Flashcards
(96 cards)
1
Q
What test is applied when the transaction involves both the sale of goods and the rendering of services?
A
The predominant purpose test which determines which law applies to the entire transaction. An exception is made for divisible contracts, when the payment for goods can be easily separated from the payment for services.
2
Q
What is the predominant purpose test?
A
A test that evaluates factors such as contract language, billing terms, allocation of costs, and the nature of the final product delivered to determine whether the contract should be considered, predominantly a contract for goods or for services.
An exception is made for divisible contracts, when the payment for goods can be easily separated from the payment for services.
3
Q
How is a contract formed?
A
Mutual assent (offer and acceptance) and consideration.
4
Q
How is intent determined in contract law?
A
Under the objective theory. Whether a party intends to enter into a contract, is judged by outward objective facts, as interpreted by a reasonable person. The intent of a party is what a reasonable person in the position of the other party would believe as a result of that parties, objective manifestation of intent. 
5
Q
What is an express contract? What is an implied contract?
A
When words expressed the intent of the parties, the contract is an express contract. When conduct indicates assent or agreement, the agreement is considered implied in fact. 
6
Q
What is an offer?
A
A communication that gives power to the recipient to conclude a contract by acceptance.
7
Q
What terms can the UCC fill the gap for?
A
Time (reasonable) or place for delivery (sellers place of business), time of payment (when buyer is to receive the goods), the assortment of goods (reasonable choice of the buyer), and even price for the goods (reasonable price based on objective standard, course of performance or course of dealing or trade usage).
UCC cannot fill the gap for subject matter and quantity.
8
Q
What’s the difference between a bilateral contract and a unilateral contract?
A
If a return promise is requested then the contract is a bilateral contract. If an act is requested, then the contract is a unilateral contract. 
9
Q
What are ways to terminate an offer? 
A
Lapse of time in offer, death, or mental incapacity, destruction or illegality, revocation, rejection.
10
Q
What is an option offer?
A
An independent promise to keep an offer open for a specified period of time. Such a promise limits the offeror’s power to revoke the offer, until after the period has expired, while also preserving the offeree’s power to accept. 
While the option contract is in effect, the offeree’s power of acceptance, cannot be terminated by rejection, counteroffer, revocation, or by death, or in capacity of the offeror 
11
Q
What is the UCC firm offer rule?
A
An offer to buy or sell goods is irrevocable if:
- The offeror is a merchant,
- There is an assurance that the offer is to remain open, and
- The assurance is contained in a signed writing from the offeror.
12
Q
What is promissory estoppel? 
A
When the offeree reasonably and detrimentally relies on the offerors promise prior to acceptance. It must have been reasonably foreseeable that such detrimental reliance would occur in order to imply the existence of an option contract. 
13
Q
What is the mailbox rule? 
A
An acceptance that is mailed within the allotted response time is effective went sent, not upon receipt, unless the offer provides otherwise. 
14
Q
What is the mirror image rule? 
A
The acceptance must mirror the terms of the offer. 
The UCC does not follow the mirror image rule. An acceptance that contains additional or different terms with respect to the terms, and the offer is treated as an acceptance rather than a rejection and a counter offer. 
15
Q
In battle of the forms, what happens when the acceptance includes additional terms? 
A
An additional term in the acceptance is automatically included in the contract when both parties are merchants, unless:
- The term materially alters the original contract;
- The offer expressly limits acceptance to the terms of the offer; or
- The offeror has already objected to the additional terms, or objects within a reasonable time after notice of them was received. 
16
Q
In battle of the forms, what happens when the acceptance includes different terms?
A
Most courts will apply the “knockout rule,” under which different terms in the offer and acceptance notify each other and are knocked out of the contract. This creates a gap and the court will use Article 2’s gap filling provisions to patch the holes. 
17
Q
What is consideration? 
A
It is a bargained for exchange. Consideration can take the form of a return promise to do something, return promise to refrain from doing something, the actual performance of some act, or refraining from doing some act. 
18
Q
What is the pre-existing duty rule?
A
At common law, a promise to perform a pre-existing legal duty does not qualify as consideration because the promisor is already bound to perform. 
19
Q
What are the rules for modifying a contract? 
A
At common law, modification of an existing contract must be supported by consideration. Under article 2 of the UCC, no consideration is necessary to modify a contract, however, good faith is required. Good faith requires honesty, in fact, and fair, dealing in accordance with reasonable commercial standards. 
20
Q
What is an accord and satisfaction? 
A
A party to a contract agrees to accept a performance from the other party that differs from the performance that was promised in the existing contract, in satisfaction of the other parties, existing duty. 
There is no satisfaction until performance, and the original contract is not discharged until satisfaction is complete. If an accord is breached by the party, who has promised a different performance, the other party can sue either on the original contract or under the accord agreement. 
21
Q
What is an illusory promise? 
A
In illusory promise, is one that essentially pledges nothing because it is vague or because the promisor can choose whether to honor it. 
22
Q
What is a requirements contract? 
A
A requirement contract is a contract under which a buyer agrees to buy all that he will require of a product from the other party. 
23
Q
What is an output contract? 
A
An output contract is a contract under which a seller agrees to sell all that she manufactures of a product to the buyer. 
24
Q
What is the material benefit rule?
A
When a party performs an unrequested service for another party, that constitutes a material benefit, the modern trend permits, the performing party to enforce a promise of payment made by the other party after the service is rendered. This rule is not enforced when the performing party render the services without the expectation of compensation, such as a gift. 
25
What is promissory estoppel? 
The doctrine of promissory estoppel can be used under certain circumstances to enforce a promise that is not supported by consideration. The promisee must actually rely on the promise, and such reliance must have been reasonably foreseeable to the promisor. 
26
What are the defenses to contract formation? 
By showing there was no meeting of the minds due to…
1. Misunderstanding
2. Incapacity
3. Mistake
4. Misrepresentation / Fraud / Nondisclosure
5. Duress
6. Illegality
7. Unconscionability
27
What is mutual mistake? 
Mutual mistake occurs when both parties are mistaken as to an essential element of the contract. In such a situation, the contract may be voidable by the adversely affected party upon proof of 1. mistake of fact existing at the time the contract was formed, 2.! the mistake relates to a basic assumption of the contract, 3. the mistake has a material impact on the transaction And, 4. the adversely affected party, did not assume the risk of the mistake. 
28
What is a unilateral mistake? 
When only one of the parties was mistaken, as to essential element of the contract, at the time, the contract was formed, either party can generally enforce the contract on its terms. However, the mistaken party can void the contract if the elements for a mutual mistake exist:
1. The mistake would make enforcement of the contract unconscionable.
2. The non-mistaken party causes the mistake, had a duty to disclose or failed to disclose the mistake, or knew or should’ve known that the other party was mistaken. 
29
What happens if there is a misunderstanding of the contract? 
If neither party knew, or should have known of the misunderstanding, or both parties know of the misunderstanding, then there is no contract.
If one party knows, or should know of the misunderstanding, then there will be a contract, formed based on the meaning of the term as understood by the unknowing party. 
30
What is fraudulent misrepresentation? 
Fraudulent misrepresentation requires proof that
1. The misrepresentation is fraudulent;
2. With intent to Misleh, the other party, and the misrepresentation induced assent to the contract; and
3. The adversely affected party justifiably relied on the miss representation.
Fraud in the factum occurs when the fraudulent misrepresentation prevents a party from knowing the character or essential terms of the transaction. In such a case, no contract is formed, and the apparent contract is void, unless reasonable diligence would have reveal the truth terms of the contract.
Fraud in the inducement occurs when a fraudulent misrepresentation is used to induce another party to enter into a contract. Such a contract is avoidable by the adversely affected party, if she justifiably relied on the misrepresentation in entering into the agreement. 
31
What is undue influence? 
Undue influence is the unfair persuasion of a party to assent to a contract. The key is whether a party has been able to exercise free, and competent judgment on whether the persuasion of the other party has seriously impaired that judgment.
Factors include the fairness of the bargain, the availability of independent advice, and the susceptibility of a party to being persuaded. 
32
What is contract duress?
Duress is an improper threat that deprived a party of meaningful choice.
When a parties agreement to enter into a contract is physically compelled by duress, the contract is void. In other instances, when a party is induced to enter into a contract by duress, the contract is voidable. 
33
What is capacity to contract? 
Parties to a contract must be competent. They must have the legal capacity to be held to contractual duties. Incompetency arises because of infancy, mental illness, or defect, guardianship, intoxication, and corporate incapacity. 
Infancy. The contract is avoidable by the infant, but not the other party. An exception to the infancy rule exists when the contract is based on necessities. When necessities are furnished to the infant, the infant must pay for them, and the recovery is limited to the reasonable value of the services or goods under a theory of quasi contract.
Mental illness. If the person is adjudicated, mentally incompetent, the contract is void. If there has been no adjudication, the contract is voidable, and may be disaffirm by the individual if the individual is unable to understand the nature and consequences of the transaction, or act in a reasonable manner with regard to the transaction, and the other party has a reason to know of this fact.
Guardianship. If an individual is under guardianship, by reason of an adjudication, a contract made by the individual is void. Except the guardian may be liable for necessities furnished by another party.
Intoxication. Intoxicated due to alcohol or drugs, is voidable by the intoxicated party, if that person was unable to understand the nature and consequences of the transaction, and the other party had reason to know of the intoxication. 
34
What are contract defenses to enforcement?
Illegality, unconscionability, public policy 
35
What is an implied in fact contract?
When a persons assent to an offer is inferred solely from that persons conduct. 
36
What is an implied in law quasi contract?
1. The plaintive has conferred a measurable benefit on the defendant;
2. The plaintiff acted without gratuitous intent; and
3. It would be unfair to let the defendant retain the benefit, because either the defendant had an opportunity to decline the benefit, but knowingly accepted it, or the plaintiff has a reasonable excuse for not giving the defendant such opportunity. 
37
What are the three warranties and sale of goods contracts?
1. Express warranty.
Any promise, affirmation, description, or sample that is part of the basis of the bargain.

2. Implied warranty of merchantability.
Implied warranty when the seller is a merchant, that deals in goods of this kind, and to be merchantable, goods must be fit for the ordinary purpose and pass without objection in the trade under the contract description.
3. Implied warranty of fitness for a particular purpose.
A warranty that the goods are fit for a particular purpose is implied when the seller has a reason to know that the buyer has a particular use for the goods, and the buyer is relying upon the seller skill to select the goods. 
38
What are ways a contract can be discharged?
1. Impracticability. Performance becomes illegal after the contract is made, the specific subject matter of the contract is destroyed, in a personal services contract, the performing party to the contract, dies or becomes incapacitated, or performance becomes impracticable.
Elements: 1) in unforeseeable event has occurred, 2) nonoccurrence of the event was a basic assumption on which the contract was made, and 3) the party seeking discharge is not at fault.
2. frustration of purpose. applies when an unexpected event arises that destroys one parties purpose in entering into the contract, even if performance of the contract is not rendered impossible. The frustrated party is entitled to resend the contract without paying damages.
3. Rescission by mutual agreement. Parties may mutually agree to cancel a contract, except where the rights of a third-party beneficiary have already vested.
4. Destruction or injury to identified goods. If the goods are destroyed by no fault of either party, before the risk of loss passes to the buyer, then the contract is voided. Both parties are discharged, neither party must perform, and neither party has breached. 
39
What are the types of beneficiaries?
A creditor beneficiary has the right to sue, either the promisor or the promisee to enforce the contract.
A donee beneficiary is given the right to sue the promisor.
In incidental beneficiary is one who benefits from a contract even though there’s no contractual intent to benefit that person. An incidental beneficiary has no rights to enforce the contract.
An intended beneficiary is one to whom the promise of the performance will satisfy the obligation of the promisee to pay money to the beneficiary, or the circumstances indicate that the promisee intends to give the beneficiary the benefit of the promised performance. 
40
What is a novation?
A novation is the substitution of a new contract for an old one, when the original obligor is released from his promises under the original agreement. 
41
What are the types of contracts within the statute of frauds?
Mr. SOUR
Marriage
Suretyship (contract to answer for debt of another)
One year (cannot be performed within 1 year)
UCC ($500+)
Real property
42
What are exceptions to the statute of frauds?
1. Specially, manufactured goods.
2. Payment and acceptance by seller.
3. Receipt and acceptance by buyer.
4. Failure to respond to a memorandum when both parties are merchants. 
43
What is the parole evidence rule?
A rule that prevents a party to a written contract from presenting extrinsic evidence of a prior or contemporaneous agreement that contradicts the terms of the contract as written 
44
What is an integration?
The final expression of the parties agreement 
45
What is the perfect tender rule under the UCC?
The obligation of the seller, to transfer ownership of the goods to the buyer, and a tender goods conforming to the warranty obligations. If the buyer rejects the goods as non-conforming, and time still remains to perform under a contract, the seller has a right to care and tender, conforming goods.
46
What is the warranty of title that UCC implies? 
In all sales contracts, provides that the seller automatically warrants that she is conveying good title, the transfer is rightful, and the goods are delivered free from any security interest of which the buyer has no knowledge at the time of the contract. 
47
Under the UCC, what are the seller’s obligations to tender goods? 
The seller must tender the goods in accordance with the contract provision, or in accordance with the UCC if the contract is silent on tender.
In the absence of a specific contract provision, on time, the gods must be tendered within a reasonable time after the contract is made.
The goods are to be delivered in one delivery, unless otherwise provided in the contract.
Unless otherwise agreed, the place of tender is the sellers place of business.
There are four methods of tender: 1. At the sellers place of business, in which the seller must give the buyer notice to enable the buyer to take delivery, 2. If the contract does not specify a place of delivery, it is a shipment contract identified by the words FOB sellers place of business, and the seller must deliver the goods to the carrier and give the buyer noticed that the goods have been shipped, 3. If the contract is a destination, contract identified by the word, FOB buyers place of business, and the seller must deliver the goods to a particular place, and tender them there by holding the goods at the buyers disposition and giving the buyer notice, 4. When goods are in the hands of a bailee, and are to be transferred, without being moved, the seller must obtain a negotiable document of title or acknowledgment from the Bailee of the buyers rights in the goods. 
48
What is breach of contract?
Once a duty to perform exist, non-performance is a breach of contract, unless the duty is discharged by agreement, statute, inability to perform, waiver, etc. 
49
What is the difference between a material breach of contract in a minor breach of contract?
A material breach of contract is when the nonbreaching party does not receive the substantial benefit of its bargain. A minor breach of contract is when the breaching party has substantially performed.
When there is a material breach of contract, the nonbreaching party, May withhold any promised performance, and may perceive remedies for the breach including damages.
When there is a minor breach of contract, the nonbreaching party may be able to recover damages, but that party must also still perform under the contract. If a minor breach is accompanied by an anticipatory repudiation, then the nonbreaching party may treat the bridge as a material breach.
Under the UCC, the seller generally must strictly perform all obligations under the contract or be in breach. The doctrine of material breach applies only in the context of installment contracts, or when the parties so provide in their contract. 
50
What is anticipatory repudiation?
Anticipatory repudiation is when a promisor repudiate a promise before the time for performance is due. The repudiation must be clear and unequivocal, by conduct or words, and if a statement, must be made to the promisee or third-party beneficiary, or assignee of the promise.
Upon repudiation, the promisee can generally treat the repudiation as a breach and sue the promisor immediately.
51
What are compensatory damages?
Compensatory damages are meant to compensate the nonbreaching party for actual economic losses. The goal of compensatory damages is to put the nonbreaching party in as good a position as performance would have done, plus consequential and incidental damages, if any, less possible mitigation of damages. 
52
What are expectation damages?
Expectation damages are intended to put the nonbreaching party in the same position, as if the contract had been fully performed. Expectation damages must be calculated with reasonable certainty. If expectation damages are to speculative, the plaintive mean said, seek reliance damages. To calculate, expectation damages, compare the value of performance, without the breach with the value of the performance with the breach.
Expectation Damages =
Loss in value + other loss - cost avoided - loss avoided 
53
What is the measure of damages for breach of warranty damages under the UCC?
The measure of damages for breach of warranty is a difference at the time, and place of acceptance, between the value of the goods excepted, and the value they would have had, if they had been as warranted, unless special circumstances show proximate damages of a different amount. 
54
What are consequential damages?
Consequential, damages or damages, that arise out of special circumstances, unique to the parties to the contract, rather than arising, necessarily from the transaction itself. Consequential damages must be reasonably foreseeable by the breaching party in order to be recoverable. Damages are considered foreseeable if they were the natural and probable consequences of breach, or if they were in contemplation of the parties, at the time, the contract was made, or if they were otherwise for seeable. There must be a causal link between the breach and the damages for the damages to be recoverable. To recover consequential damages, the damages cannot be speculative. A plaintive must prove the dollar amount of the damages with reasonable certainty. 
55
What are incidental damages?
In the sale of goods, incidental damages resulting from the sellers breach include expenses, reasonably incurred in inspection, receipt, transportation, care, and custody of goods, rightfully rejecting, any commercially, reasonable charges, expenses, or commissions in connection with affecting cover, and any other reasonable expense incident to the delay or other breach.
Incidental damages to an agreed seller include any commercially, reasonable charges, expenses, or commissions, incurred in stopping delivery, in the transportation, care, and custody of goods, after the buyers breach, in connection with return, or resale of the goods, or otherwise, resulting from the breach. 
56
What are liquidated damages?
Liquidated damages are damages to be recovered by one party without proof of actual loss in the event, the other party reaches the contract.
For liquidated damages to be enforceable, the following two prong test must be met at the time of contracting:
1. The amount of liquidated damages was reasonable, bearing some relation to the damages that might be sustained, and
2. Actual damages were uncertain in amount, and would be difficult to prove. 
A liquidated, damages clause may not merely serve as a threat to secure performance, or as a means, to punish non-performance, otherwise it is an enforceable as a penalty.
Note: some jurisdictions have a third prong to this test, and refused to enforce a clause, under which the liquidated damages are disproportionate to the actual damages incurred by a party. A few jurisdictions refused to enforce a liquidated damages clause, if the party does not suffer any damages as a consequence of the breach. If the liquidated damages clause is an enforceable, recovery is limited to any actual damages that a party can prove. 
57
What are punitive damages?
Punitive damages are damages to punish fraud, for violation of a fiduciary duty, for acts of bad faith, or for deterrence. Punitive damages are not recoverable unless the conduct constituting the breach is also a tort, for which punitive damages can be recovered. 
58
What are nominal damages?

Damages do not need to be alleged in the cause of action for breach. If no damages are alleged or no damages are approved, the plaintiff is still entitled to a judgment for nominal damages, such as one dollar. 
59
What are restitution damages or recovery?
When a defendant is unjustly, enriched by the plaintive, restitution generally allows the plaintive to recover on the benefit, conferred by the plaintive, upon the defendant, rather than on the harm suffered by the plaintive. 
60
What are reliance damages?
Reliance damages may be recovered, if nonbreaching party incurred expenses in reasonable reliance upon the promise of the other party would perform.
Note: an injured party can choose to pursue reliance damages instead of expectation damages, but cannot recover both reliance and expectation damages. 
61
Under the UCC, what are the buyers remedies?
If the seller fails to tender the goods, the buyer may cancel the contract, recover any payments, made to the seller for the goods, recover the market price minus the contract price, incidental, and consequential damages, resulting from the sellers breach, the buyer may purchase similar goods elsewhere and recover the replacement price minus the contract price, the buyer may demand specific performance for unique goods,
62
What is reformation?
Reformation is the modification of a contract by a court upon petition by a party. The modification is typically based on the failure of the contract to reflect the intent of the parties to the contract. 
63
What is rescission?
Rescission is the unmaking of a contract, whether the contract is oral or written. Rescission leaves the parties to a contract in the same position they would have been in if the contract never existed. 
64
What is a declaratory judgment?
A declaratory judgment action is meant to obtain in adjudication of the rights and duties of the parties if their rights and obligations under contract are unclear, and an actual dispute exists between the parties concerning those rights and obligations. 
65
What are the elements for the defense of misunderstanding?
1. The parties used a material term that is open to two or more reasonable interpretations (the objective test cannot apply)
2. Each side attaches a different meaning to the term, and
3. Neither party knows, or should know, of the confusion. 
66
What are the elements for the defense of mistake?
Mutual:
1. There is a mistake of fact, existing at the time that the deal is made;
2. The mistake relates to a basic assumption of the contract, and has a material impact on the deal; and
3. The impacted party did not bear the risk of the mistake.
Unilateral Mistake
1. All of the elements of a mutual mistake, and either
a. The mistake would make the contract unconscionable, or
B. The other side I knew of, had reason to know of, or caused a mistake.
67
What is misrepresentation and what are the elements for using the defense of misrepresentation?
Miss representation is a statement at the time of contracting that is not true. It can be intentional, which is fraudulent, or accidental.
Elements:
1. A misrepresentation of a present fact, not opinion,
2. That is material or fraudulent, intentional, and
3. That is made under circumstances in which it is justifiable to rely on the misrepresentation.
68
What is fraud in the execution?
You trick someone into signing some thing that they do not even know is a contract.
69
What is non-disclosure?
Non-disclosure is when the other party does not learn the truth about some thing and you just remain quiet. Normally you do not need to tell the other side about all material facts related to the deal. Exception is if there is a special fiduciary, relationship, or active concealment.
70
What is economic duress?
It arises when one party makes threats to the other party to induce that party to contract or modify a contract.
71
What is undue influence?
Arises when a party puts up very intense sales pressure on another party, who often seems weak, minded, or susceptible to high pressure sales tactics. 
72
What is illegality?
Illegal contracts are unenforceable. But a contract entered in furtherance of an illegal act will still be enforced.
Typically the law will just leave the parties where they stand. However, there is a modern trend toward allowing less guilty parties to recover restitution.
Contracts against public policy are not enforced. 
73
What is the defense of unconscionability?
Unconscionability is when it shocks the conscience. It’s unconscionable.
There are two varieties of unconscionability :
1. Procedural unconscionability, a defect in the bargaining process itself, usually a hidden term or an absence of meaningful choice (no other contracting option).
2. Substantive unconscionability is a rip off some term of the contract. 
74
What types of contracts does the statute of fraud apply to?
Marriage
Suretyship
One year
UCC
Real property
75
What type of real property does the statute of frauds apply to?
Only those transferring an interest in the property. 
76
How is the statute of frauds satisfied?
By either performance, or buy a signed writing.
Part performance of a real estate contract can satisfy the statute of frauds, if any two of the following three elements are met:
1. Possession
2. Payment
3. Improvements to the land. 
The signed writing must show that a contract has been made, identify the parties, contain the essential elements of the deal, and signed by the party against whom the contract as it started against .
77
How is the statute of frauds satisfied under the UCC?
1. Assigned writing, does not need to mention the price, but must mention the quantity. It is only enforceable, for the quantity mentioned in the writing.
2. Part performance satisfies the statute of frauds, but only for the quantity delivered and excepted.
3. Custom made goods are exempted from the statute of frauds, if the maker can show that it made a substantial beginning towards manufacturing the goods.
4. A judicial admission in a pleading or during testimony.
5. The failure to object to a confirming memo within 10 days will satisfy the statute of frauds only if both parties are merchants.
78
What is the parole evidence rule?
If the parties have reduced their contract to a comprehensive writing, then, earlier statement, or Ridings related to this agreement, or not part of the deal under the parole evidence rule.
A complete integration is when the contract expresses all terms of the agreement.
A partial integration is where there’s a final writing, but some terms are not included. 
79
How does the UCC treat the parole evidence rule?
A presume that a writing is, at most, only a partial integration, unless the parties would have certainly included a disputed term in the writing. 
80
How do you distinguish an agreement that is not integrated from one that is completely or partially integrated?
Look for a merger clause, which is evidence of complete integration 
81
What are situations in which the parole evidence rule does not apply to bar earlier evidence?
1. It will not bar evidence, relevant to a defense against contract formation (duress, mistake, fraud, etc.).
2. Even if you’re riding is completely integrated, a party can introduce evidence of a second separate deal.
3. Even if the writing is completely integrated, a party might be able to introduce evidence of a prior communication that is designed to interpret an ambiguous term in the final agreement. 
82
What are the three types of warranties?
Express warranty
Implied warranty of merchantability
Implied warranty of fitness for a particular purpose 
83
What is an express warranty?
A promise that affirms or describes the goods and is part of the basis of the bargain is an Express warranty, unless it is merely the seller’s opinion.
84
What is the implied warranty of merchantability?
This warranty is triggered only when the seller is a merchant, dealing in the goods that issue. It warrants that the goods are fit for ordinary commercial use.
85
What is an implied warranty of fitness for a particular purpose?
This warranty is triggered when a buyer relies on his sellers expertise to select a special type of good that will be used for a special purpose. It warrants that the goods will satisfy the special purpose. 
86
What is constructive condition of exchange?
It is one parties performance is conditioned on the other sides performance 
87
Can a breaching party who fails to satisfy the constructive condition of exchange due to a material breach get paid anything?
Not under the contract, but maybe under a quasi contract
88
What is the perfect tender rule? 
It is when dealing with the sale of goods, the perfect tender rule states that a buyer is permitted to reject goods shipped or delivered to it from a seller. If the seller’s tender of the goods is in someway, not perfect. It has two components, perfect goods, perfect delivery.
89
When the goods are damaged, before the buyer receives them, who will bear the loss, the seller or the buyer?
1. Check whether the parties have already dealt with the risk problem in the contract. If so, their agreement will control.
2. If not, ask whether either party has breached. If so, the breaching party bears the risk of loss, even if the breaches unrelated to the delivery damage.
3. If it was a shipment contract, then the risk of loss during delivery rest with the buyer. If it was a destination contract, then the risk of loss during delivery rest with the seller.
4. In all other cases, ask whether the seller is a merchant. If so, the risk of loss stays with the seller until the buyer receives the goods. If not, the risk of loss moves to the buyer when the seller tenders the goods. 
90
What are some of the things that can prevent one side from having to perform a contract?
1. The contract becomes impossible to perform.
2. The performance becomes illegal after the contract is formed.
3. The subject matter of the contract is destroyed.
4. In a service contract with a special person, the performing party dies, or is incapacitated.
5. Frustration of purpose, the event must be extreme and not previously allocated to one of the parties.
6. The initial contract has been modified or canceled.
7. The parties to an earlier contract, agree that performance will be satisfied instead by the completion of a different performance. The new performance is called the Accord. The excusal of the initial performance obligation is called the satisfaction.
8. There is an ovation when both parties agree that is substitute person will take over the contractual obligations.
91
What is the difference between impracticability and impossibility? 
Impractical ability arises when performance of a contract by a party has become difficult or costly to perform. The difference between impracticalability and impossibility is that impracticability is still physically possible, however, performance will result in a substantial hardship to the performing party. Impracticability will excuse performance, where the excuse party did not have control over the condition that made performance in practicable. The excused party must not have expressly or impliedly assumed the risk of the duties becoming impracticable.
A party may be excused from her duty to perform under contract if performance becomes impossible. Events that make a contract impossible include a legality of the subject matter, the subject of the contract is destroyed, one of the parties to the contract, dies or becomes physically or mentally disabled, natural forces interrupt the contract, performance would cause substantial risk of physical harm to one party. 
92
What options does a nonbreaching party have in an anticipatory repudiation?
1. Treat the repudiation as a breach, and Sue immediately for damages. But if you have completed the entire performance in our only waiting for payment, you cannot sue early.
2. Ignore the repudiation, demand performance and see what happens.
93
Can a party retract its repudiation?
Yes, as long as the other side has not commence the lawsuit, or acted in reliance on the repudiation.
94
What is the UCC rule for anticipatory repudiation?
If one party has reasonable grounds for insecurity about the other sites performance, they may demand an adequate assurance of performance. If the party fails to respond within a reasonable time, you can treat this as a repudiation. 
95
What are expectation damages?
Damages that are meant to put a party in the same economic position. It would be in if the contract had been performed as promised. It is measured by comparing the value of the performance without the breach to the value of the performance with the breach. 
96
FIRM SCAN
Full performance of contractual obligation
Impossibility, and practicability, or frustration of purpose
Release, in writing only
Mutual rescission
Substituted contract
Contract or covenant not to sue
Accord and satisfaction
Novation

