Contract Basics Flashcards
contract definition
a promise or set of promises enforced by law
aka a legally enforceable agreement
MA(O+A) + C - D
contract requirements
- mutual assent
- consideration
- no defenses to formation
mutual assent
(objective) a meeting of the minds
* valid offer and acceptance
consideration
a bargained-for exchange of legal value between parties
formation defense effect
if there is a valid defense to formation, the k may become
1. void
2. voidable
3. unenforceable
void
k never had any legal effect
can NEVER be enforced
voidable
one or both parties may elect to void the K
aggrieved party may still enforce
eg, infancy, mental incapacity
unenforceable
otherwise valid k that is unenforceable b/c a defense applies
eg SoFs
applicable laws
common law
OR
UCC Article 2
UCC Article 2
governs sales of goods
goods
any tangible, movable object
common law
applies to everything other than goods
EX: real estate or services
mixed ks
ks involving both goods and services
predominant purpose test
for mixed ks, the predominant purpose of k dictates applilcable law
predominant purpose exception
payments divided between goods and services
- apply UCC to goods part
- apply CL to remainder
good faith
honesty in fact and the observance of reasonable commercial standards
good faith duty
duty under both CL and UCC in both formation and enforcement
fair dealing duty
just CL
NOT UCC
breach of good faith
breaching party can be deprived of fruits of k
express k
formed by language (written or oral)
implied k
formed by conduct
eg, sitting in barber’s chair and getting haircut
bilateral k
exhange of mutual promises
each party is promisor + promisee
unilateral k
offer requires performance as the manner of acceptance