Terms

Question 1

What are the elements of Modification?

Answer 1

Common Law: Requires consideration to modify a contract.

UCC: Does not require consideration to modify a contract, but good faith is required.

Question 2

When can agreements to modify a contract still be enforced?

Answer 2

Under the common law.

(1) Parties rescind existing contract by tearing it up and then enter in a new contract where a party must perform more than previously

or

(2) A party agrees to compensate after unexpected difficulties. Modification must be fair.

or

(3) There are new obligations on both sides.

Question 3

UCC Installment Contract Exception to Modification

Answer 3

When there is an installment contract, a waiver of a condition can be retracted if the other party is provided reasonable notice that strict performance is required.

The retraction is allowed unless it would be unjust because of a material change.

Question 4

What are the elements of Accord and Satisfaction?

Answer 4

Accord: A party agrees to accept different performance than was initially required

Satisfaction: Performance of the Accord agreement

Question 5

Accord dispute of a monetary claim exception

Answer 5

For monetary claims, a party can agree to a lesser amount in full satisfaction of the claim. But there must be consideration for a party to accept the lesser amount OR if the payment is of a different type.

Question 6

What are the elements of Parol Evidence Rule?

Answer 6

Only applies to written documents that are an integration. An integration is a document that is the final expression of the agreement.

The steps for the Parole Evidence Rule are (1) Is there an Integration? and (2) Intent of the Parties. The intent of the parties determines which kind of integration.

Question 7

What is the overview of Terms?

Answer 7

1. Modification
2. Accord and Satisfaction
3. Parol Evidence Rule

Question 8

What is Total and Partial Integration?

Answer 8

Total Integration: A writing completely expresses all of the terms in the agreement.

If there is total integration, parties cannot introduce any extrinsic evidence.

Partial Integration: If the writing is only partially expresses all of the terms.

If there is partial integration, parties can introduce extrinsic evidence (oral or written) as long as the evidence is consistent with the writing.

Question 9

How to determine the intent of the parties

Answer 9

Common law: A court is only permitted to look at the writing itself for evidence of intent. If the written contract is detailed or there is a merger clause, this constitutes Total Integration.

UCC: Presumes that a written contract is only a partial integration. A court allows any additional terms unless the parties “certainly would have included them in the contract.”

Second Restatement Rule: If an extrinsic term would naturally be left from an agreement, then the term can introduced as long as it doesn’t contradict the writing.

Question 10

What are the exceptions to the Parol Evidence Rule?

Answer 10

1. Raising a defense to the formation of a contract
2. Establishing a defense to the enforcement of a contract
3. Separate Deal
4. Condition Precedent
5. Ambiguity and Interpretation

—Courts can look at trade usage and local custom to direct ambiguous terms

—If still ambiguous, courts can employ the plain meaning rule (majority) or context rule (minority rule)

6. Subsequent agreements
7. Performance, Course of Dealing, and Trade Usage

—Relevant analysis is ranked in importance of that order