Formation

Question 1

Contract (formation para)

Answer 1

A contract is a promise or set of promises for the breach of which the law provides a remedy and for the performance of which the recognizes as a duty

Question 2

Promise (formation para)

Answer 2

A promise is a manifestation of intent to act or refrain from acting in a specified manner, made to justify another in understanding that a commitment has been made

Question 3

Formation (formation para)

Answer 3

The formation of a contract requires a bargain with a manifestation of mutual assent to the exchange and consideration. A contract for sale of good may be made in any manner sufficient to show agreement, including parties conduct.

Question 4

Manifestation of Mutual Assent

Answer 4

Mutual assent in the agreement upon the same bargain at the time, and is reflected in the offer and acceptance, writing, or conduct. Manifestation of assent to an exchange requires that each party either make a promise or begin or render a performance. The manifestation of assent may be made wholly or partly, written or spoken, or by other facts or failure to act. The conduct of the party may manifest assent even though he does not in fact assent. The UCC recognizes any manner sufficient to show agreement, including conduct by both parties that shows the existence of a contract. MOMA – can be evidenced by offer and acceptance, writing, or conduct

Question 5

Offer

Answer 5

An offer is a manifestation of willingness to enter into a bargain, made to justify another in understanding that their assent is invited and will conclude it. Per Lefkowtiz, a valid offer must be reasonably certain, demonstrating objective intent, and communicated to create a power of acceptance. At common law, the offer is certain when it contains the Quantity, Time, Involved Parties, Price, and Subject Matter (QTIPS). The UCC only requires Quantity Parties and Subject Matter (QPS), missing terms will be gap filled.

Question 6

Non-Offers

Answer 6

Generally, price quotes, advertisements, preliminary negotiations, and offers made in jest are not sufficient offers because they lack certainty and do not create a power of acceptance in the offeree. An offer is not valid if the person whom it is addressed knows or has reason to know that the person making it does not intend to conclude a bargain until he has made a further manifestation of ascent.

Question 7

Counteroffer

Answer 7

A counteroffer is an offer made by the offeree to the offeror regarding the same subject matter as the original offer but containing different terms. It is a rejection and a new offer -

Question 8

Termination of an Offer

Answer 8

A contract cannot be created by acceptance after the power of acceptance has been terminated by rejection, counteroffer, lapsed time, revocation, death, or incapacity

Question 9

Irrevocable Offer

Answer 9

Offers can be revoked before acceptance; however, some offers, such as option contracts or merchant firm offers, cannot be revoked within a reasonable or stated time

Question 10

Merchant Firm Offer

Answer 10

A firm offer requires a writing signed by a merchant, but it does not require any consideration. The offer is firm for 3 months or a shorter time if specified in writing. It is irrevocable. (doesn’t apply to CL, only for goods- UCC 2205)

Question 11

Option Contract

Answer 11

an option contract does not require a signed writing nor does a merchant have to be a party, but it does require consideration to be irrevocable. The option remains in effect for as long as both parties agree. (no consideration = revocable / consideration = irrevocable; mailbox rule does not apply – have to receive acceptance)