Contracts Flashcards
An offer is ___
an invitation to enter into a K
Offers are revocable (until accepted), unless it is an:
Option K, Firm offer, Unilateral K
An option K is
promise to keep K open for a period of time
You need _____ for an option K
additional consideration
Option K’s are between ___ not merchants
laypeople
Firm offers are
A promise to keep an offer open but there must be a signed writing by the seller. Firm offers are between merchants
Unilateral K is
a promise for performance or action.
For a unilateral K, the moment you begin performance, the offer is __-
irrevocable
The two ways to revoke an offer are:
- direct- call/tell the other person nvm
- indirect- you learn from another source that the person has made a deal with someone else
Acceptance is
manifestation of intent to accept
Mailbox rule
as soon as you drop your acceptance in the mailbox the K is formed
Mailbox rule exception
If the first response is a rejection and it is followed by an acceptance, whichever communication arrives first wins
Consideration is
a bargained for exchange
A promise to give a gift is not ___
enforceable.
Giving of a gift is not ___
revocable
Third party beneficiary is when
two parties make a K and a third party benefits
Two types of beneficiaries:
intended and incidental
Intended beneficiaries
Original parties expressed their intent to benefit them, and they may have rights if they have vested
Incidental beneficiaries never have
rights
Rights vest when
1) one or both original parties inform the beneficiary that he is being benefited or 2) when he learns of the benefit and begins to rely
Assignment is when
one party assigns away their rights in the K
Delegation is when
one party delegates their duty under the K
If new party does not show up or breaches, who can you sue?
both the original party and the new party unless there is a novation
A novation is a
release of liability
Can the new party change the terms of the K?
No. they only acquire rights and obligations that were in the original K
If someone has unique/special skill or expertise, you cannot
give the job to someone else, even if they have the same skill
If parties agree against assignment and you assign it anyways ____
the assignment is still valid and effective BUT you can sue for damages for breaching the promise
If K says no delegation is allowed ___
then it is strictly construed and you CANNOT do it
Contracts that need to be in writing based on the statute of frauds are ___
M= marriage Y= K that cannot be performed in less than 1 year L= land E= executor – when you name someone executor of an estate G= Guarantor/surety K- guaranteeing the debt of someone else S= sale of goods of 500 or more
Parole evidence is when ____
After a contract is formed, one party tries to admit oral evidence in the contract (things we talked about beforehand). Q will say x goes to court and asks court to admit the evidence.
if K is final ___
nothing will be admitted, except to clear up ambiguity. THEY WILL TELL YOU IF ITS FINAL
If K is partially integrated ___
parole evidence is admitted, unless it is a material alteration or it contradicts material terms
Parole evidence will always come in to ____
prevent fraud or duress, to prove the existence of a condition preceding, in sale of goods to show trade or custom
Conditions are when ___
something happens which relieves or requires party of duty to perform. Sometimes they test on when condition needs to occur.
The three different conditions:
Precedent (before K day), Subsequent (after K day), Concurrent (on K day)
Waiver of condition is when you
say not to worry about the condition that was in the K, therefore eliminating the requirement
Two types of remedies
legal or equitable
Expectation damages are
default legal remedy. Puts victim in position they would have been had the K been performed
Liquidated damages
damages calculated at the time we enter the K bc if we wait until a party breaches the damages would be too difficult to calculate – they are valid and enforceable as long as they are reasonable and not acting like a penalty – 10% or less of the value of the K it is going to be reasonable, anything higher is more penalty
Specific performance
Someone has to perform/do what they were supposed to = k is UNIQUE (LAND)
Injunction
Stop someone from performing
Recission
put parties in position there were PRIOR to the contract – no meeting of the minds: court will grant Recission
Modification means
changing a material term of K aka K is already made.
At common law, for a modification you needed ___
additional consideration
Under the UCC, for modifications, no _____
additional consideration is needed, only good faith
If goods are non conforming you may ___
reject, accept, accept in part, reject in part
if non conforming goods are delivered before the day of the K you must ___
give the opportunity to cure
If you deliver non-conforming goods on K day but seller had reasonable belief buyer would accept anyways
they must again be given opportunity to cure as long as they can do so in reasonable amount of time
Anticipatory repudiation is when
prior to the K day, one party UNEQUIVOCALLY refuses to perform. Has to be absolute “I’m out” “I am not doing it”
If there is anticipatory repudiation, you can ____ OR ___
sue immediately for total breach OR you can wait till the date and see if the K will be performed
Words that someone is nervous or insecure is NOT repudiation BUT _____
you may demand assurances from the person
Promissory estoppel is a
promise or statement that induces detrimental reliance
Detrimental reliance is what makes the promise ___
enforceable
Impossibility means that
no one can perform the K (objective standard)
Impracticability means
due to unforeseen circumstances, performance, though possible, has now become too difficult unfair or expensive (too expensive is commonly tested)
Impossibility and impracticability are ___ to performance
defenses
Unilateral mistake is when
one party is mistaken and it is not a defense to performance
Mutual mistake is when
both parties are mistaken about a basic assumption of the K and it is a defense
