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Torts > Contracts T1 Continued Q2 > Flashcards

Contracts T1 Continued Q2 Flashcards

1
Q

DEFENSES TO FORMATION
FORMATION
▪️Capacity

A

Minors
-voidable by the minor but binding on the adult
▪️Disaffims While a Minor - must return any gain they still retain.
▪️Affirms upon Majority = can be done expressly or by conduct.
▪️Neccesities (Quasi-K) adult can recover on contract for necessities.
i. Necessities- food shelter, clothing, medical care, medicine, and any other item necessary for the minor’s subsistence, health, or education.

Mental Incapacity
- voidable if unable to understand nature and consequences
▪️ Disaffirms- must return any gain they still retain.
▪️Affirms When Lucid- can be done expressely or by conduct
▪️Neccessities (Quasi-K)-other part can recover on contracts for neccessities.

Drunk or Drugged
-temporary incapacity if unable to understand nature and consequences and the other party knew or should have known this is the case.
▪️Necessities (Quasi-K)-other party can recover on contracts for necessities.

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2
Q

DEFENSES TO FORMATION
FORMATION
▪️Duress

A

Unfairly coerced by wrongful threats which overcome the free will of the party.

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3
Q

DEFENSES TO FORMATION
FORMATION
▪️(Undue) Influence

A

Unfair persuasion by one with dominion or influence over them.

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4
Q

DEFENSES TO FORMATION
FORMATION
▪️Misrepresentation

A

-voidable if justifiable on a material misrepresentation of fact.

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5
Q

DEFENSES TO FORMATION
FORMATION
▪️Fraudulent Misrepresentation (Fraud in the Inducement)

A

-one party makes an intentionally false statement that causes the other party to assent to the agreement. Voidable if justifiable reliance on the fraudulent misrepresentation.

▪️Concealment
- no duty to disclose but can not take affirmative steps to conceal.

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6
Q

DEFENSES TO FORMATION
FORMATION

▪️Ambiguity

A

-contains a material term that is open to two or more interpretations.

▪️Neither Party aware-No contract unless both parties happensed to inten the same meaning.
▪️Both Parties aware- No contract unless both parties intended the same meaning.
▪️One Party Aware- a contract will be enforced according to the intention of the unaware party.

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7
Q

DEFENSES TO FORMATION

FORMATION
▪️Mistake

A

▪️Mutual Mistake
- voidable if mistake about an existing material fact and the aggreived party did not assume the risk of the mistake
▪️Unilateral Mistake
- voidable if mistake about an existing material fact, the aggrieved party did not assume the risk of that mistake, and the other party knew or should have known of the mistake.
🔘Exception=an error in judgment about something’s quality or value along will not result in a voidabel contract.

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8
Q

ENFORCEMENT

Unconscioniablity

A
  • a contract or clause that is so one-sided and so unfair as to not be enforceable.
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9
Q

ENFORCEMENT

Illegality

A

-Contract for an illegal purpose or subject matter

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10
Q

ENFORCEMENT

Public Policy

A

-exculpatory clause that exempts intentional or reckless conduct.

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11
Q

ENFORCEMENT

Statute of Frauds

A

-Contracts that must be in writing: (MR DOG)
▪️Marriage- all conrtracts in consideration of marriage, including prenuptials.
▪️Real Estate- applies to transger of intrerest. Alsao leasesor easements of more than one year
▪️Debts of Another - only applies to collateral promises.
🔘Main Purpose Exception- If the guarantee is to benefit the gurantor.
▪️Over 1 Year to Perform - however, a task with no time, and lifetime contracts, are not within statute of frauds.
▪️Goods totaling over $500 or more

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12
Q

ENFORCEMENT

Statute of Frauds (SOF) Memorandum Requirements:

A

Common Law. UCC
1. Subject matter. 1. Quantity
2. Terms. 2. Sufficient writing to indicate formation
3. Identity of the parties 3. Signature of the defendant
4. Signature of the defendant
▪️Signature can be typed,printed, or e-signed. Under UCC, can be initials or letterhead
▪️Integration of several documents is acceptable
▪️Merchant to Merchant Sale of Goods - signature of defendant is waived if defendant faids to respond with objections within 10 days to a written confrimation of the understanding.

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13
Q

ENFORCEMENT

SOF Equal Dignity Rule (Agents)

A
  • if the contract being signed is within the SOF, the agent’s authority to sign the contract must also be in writing.
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14
Q

ENFORCEMENT

SOF Requirements for Modifications

A

-If the K, with the modifications, would be within the SOF, then the modification must be in writing

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15
Q

ENFORCEMENT

SOF Satisfaction Defenses

A

▪️Performance
⚪️Real Estate Contract with Partial Performance - partial perfomace usuallyt includes improvements
⚪️Service Contract Full Performance- must have been fully performed to be enforeceable
⚪️Sale of Goods Partial Performance -only to the extent of the partial performance
▪️Delivered Goods- outside the SOF (delivered goods are objective proof)
▪️Specialty Goods- if seller makes a “substantial beginning” to the work
▪️Judicial Admission- defendant admits there was an agreement
▪️Estoppel- plaintiff’s detrimental reliance on the defendant’s promise to puts in writing, or assertion that the SOF does not apply.

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16
Q

Terms of the Contract

Parole Evidence Rule

A

Any agreements made prior to or contemporaneous with the contract that change, add to, or contradict an intergrated written contract will not be admitted except:

To show fraud, duress, mistake, or misrepresentation 
To clarify ambiguous terms
 Integrated - full expression of the Agreement (based on the intent of the parties)
17
Q

Terms of the Contract

Collateral Contract Rule

A

A parole agreement that is collateral to the written agreement is admissible if it:

▪️Does not conflict with the written integration, and 
▪️Concerns a subject matter that similarly situated parties would not ordinarily be expected to include in the written instrument.
 ▪️Collateral-related to the subject matter, but not part of the primary purpose.
18
Q

Terms of the Contract

Interpreting the Terms of the Contract

A

-contract terms may be explained or supplemented by evidence of:

▪️Course of Performance- the way the parties have conducted themselves up to this point in e particular contract.
▪️Course of Dealing - how the parties have acted in previous contracts
▪️Usage of Trade- the meaning attached to the term in a certain region or industry.
19
Q

Terms of the Contract

U.C.C. Gap Fillers

A

-Provides default terms to the contract that govern if there is a certain type of gap.

▪️Price - reasonable price at the time of delivery
▪️Place of Delivery - seller’s place of business
▪️Time for Payment - upon receipt of goods
▪️Duration of contract - a reasonable time
20
Q

Terms of the Contract

UCC Shipment K

A

-delivery complete when goods reach the common carrier, reasonable arrangement made for delivery and the buyer is notified (FOB-seller’s city)

21
Q

Terms of the Contract

UCC Destination K

A

-delivery completed when the goods reach their destination (FOB-buyers buyer’s city)

22
Q

Terms of the Contract

UCC Risk or Loss

A

-who bears the loss if goods are damaged or destroyed during shipping:

  1. Agreement controls
  2. Breaching party is liable
  3. Shifts from seller to buyer at delivery
  4. Non-Merchant seller- shifts upon “tender”
    Tender- The agreed upon time for which the goods are ready to be picked up assuming they are actually ready to be picked up.
23
Q

Terms of the Contract

UCC Warranty

A

▪️Express-words that promise, describe or state facts.
▪️Implied Warranty of Merchantability-added by operation of law, applied if merchant deals in goods of that kind, Goods must be fit for ordinary purposes.
▪️Implied Warranty of Fitness for a Particular Purpose- buyer has a particular purpose, seller knows of that purpose, buyer relies on seller’s selection. Foods must be fit for that particular purpose.
▪️Disclaimer (“there are no warranties”) - Express warranties cannot be waived. Implied warranties can be waived if sold “as is”

24
Q

EXCUSE OF PERFORMANCE

CONDITIONS

A

Express Condition
-language in a contract that limits obligations created by other contract language. Strict compliance is required (”provided that,”If,” ”unless,” “subject to”)

▪️Personal Satisfaction as a Condition- only if satisfaction is honest and in good faith
▪️Waiver - person who benefits front he condition can waive it
▪️Prevention - person who is protected by the condition not allowed to hinder or prevent its occurrence
25
Q

EXCUSE OF PERFORMANCE

CONDITIONS

A

Constructive (Implied) Condition
-Conditional upon the occurrence of some event or state of the world even though the contract does not explicitly so state.
▪️Performance - the duty of each party to render performance. A breach of the contract is also a nonfulfillment of an implied condition of performance on the contract.
▪️Cooperation and Notice- the obligation of one party to render performance is impliedly conditioned on the other party’s cooperation in that performance.

26
Q

EXCUSE OF PERFORMANCE
CONDITIONS
Condition Precedent

A

-must occur before a party has a duty to perform

I.e. X will pay Y’s law school tuition if Y gets accepted to law school

27
Q

EXCUSE OF PERFORMANCE
CONDITIONS
Condition Subsequent

A

-terminates a duty to perform

I.e Y agrees to work for one year unless Y is admitted to law school during that period.

28
Q

EXCUSE OF PERFORMANCE
CONDITIONS
Condition Concurrent

A

-Conditions that are capable of occurring together, and that the parties are bound to perform at the same time.

Each is a condition precedent of each other.

29
Q

EXCUSE OF PERFORMANCE
CONDITIONS
Excuse of Condition

A

-a duty of immediate performance with respect to a conditional promise does not become absolute until the conditions have been performed or have been legally excused.
▪️Hindrance or Failure to Cooperate-person who is protected by the condition not allowed to hinder or prevent its occurrence.
▪️Substantial Performance-the condition of complete performance may be excused if the party has renedered substantial performance.
- Usually only applies to constructive (implied) conditions, not express conditions
- Generally not applicable to the sale of goods-(see perfect tender rule)
▪️Divisibility - UFC’s a party performs one of the units of a divisible contract, he is entitled to the agreed equil
▪️Waiver- one having the benefit of a condition indicates by worlds or conduct that she will not insist on that condition being met.
🔹Estoppel Waiver-a party indicates waiver of a condition befre it is to happen, and the other party detrimentally relied on the waiver/ Promise to waive can be retracted at any time abefore the other party has detrimentally relied.
🔹Election Waiver-a condition does not occur, however th party benefittinh from the condition chooses to contime under the contract. Cannot be retracted.
🔹Cannot waive entitlement to the entire or substantial return performance- of no consideration if given for the waiver, the condition must be ancillary or collateral to the main purpose of the contract.

30
Q

U.C.C PERFORMANCE

Perfect Tender Rule

A

-seller is obligated to deliver perfect goods. The buyer is obligated to inspect the goods within a reasonable time of delivery.
Not perfect - buyer can reject all or part of the goods but the seller’s has a right to cure the non-conformity if the time for performance has not yer expired or seller reasonably thought
▪️Goods would be acceptable to the buyer
▪️Buyer would be satisfied with a Money allowance
Installment Contract - Non-perfect installment can only be rejected if it substantially impairs the value of the goods and cant be cured.
Acceptance - once accepted buyer can no longer reject goods. Payment alone is not acceptance.
Implied Acceptance - buyer keeps goods after reasonable opportunity to inspect.
Revocation after acceptance - allowed only if no-conformity substantially impairs the value of the goods and made within a reasonable time of discovering the impairment.
EXCEPTION TO THE PERFECT TENDER RULE
Installment K- Non perfect installment can only be rejected if it substantially impairs the value of the goods and candy be cured.

31
Q

U.C.C PERFORMANCE

Anticipatory Repudiation

A
  • a party’s unambiguous refusal to perform as promised prior to the time set for performance. The other party can:▪️Immediately sue for breach
    ▪️Exception - if plaintiff has completed their performance, must wait until set for performance to sue.
    ▪️Wait for the time set for performance -then sue for breach.
    ▪️Demand adequate assurance of performance
32
Q

LATER CONTRACT

Recission

A
  • contract is cancelled by mutual agreement or due to mistake, fraud, misrepresentation, illegality, coercion, or undue influence.▪️Exception - contract cannot be rescinded if one party has already performed.
33
Q

LATER CONTRACT

Novation

A
  • all parties to an existing contract agree to the substitution of a new party in place of one of the parties. The substituted party assumes all duties of the replaced party.
34
Q

BREACH

Material Breach

A
  • defendant did not substantially perform. Action for breach of entire contract and excuses further performance.
    ▪️Divisible Contract Exception - recovery for substantial performance of a divisible part allowed.
35
Q

BREACH

Minor Breach

A
  • defendant substantially performed. Action for damages related to the breach but must still perform.

Torts (5 decks)

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