Contracts Flashcards
______ protects against unjust enrichment, whenever contract law yield an unfair result. It is an equitable remedy of last resort.
Restitution
In a ___________ contract, an offer can only be accepted by ___________
(i) unilateral; (ii) performance
An advertisement is not an offer unless there’s a clear _______.
Quantity
In a UCC Contract, the court can read in _______, but not in common law.
reasonable terms
You must know of an ______ in order to accept it.
Offer
A offer will (i) ________ if passes its stated term or if a (ii) _______ _____ has passed.
(i) lapse; (ii) reasonable term
Generally, an offer can be _________ at any time before acceptance
Revoked
An offeror can directly (i) __________ an offer by expertly telling the offeree. The offeror can also engage in conduct that demonstrates the offer has been (ii) _____, and the offeree is (iii) ________ of the conduct.
(i) revoke; (ii) revoked; (iii) aware
An offeree’s outright (i) __________ or (ii) __________ will serve to terminate the original offer.
(i) rejection; (ii) counteroffer
While a counteroffer will revoke an offer, mere (i) _____ will not serve to revoke the offer.
(i) inquiry
An offer cannot revoked if there is an (i) ______ contract, or (ii) a UCC 2-205 _____’s _____ ________, which must be a signed writing to keep an offer open (for a specific term, OR a reasonable time not to exceed 90 days); (iii) foreseeable _______ before acceptance, and (iv) starting ___________ under a unilateral contract
(i) options; (ii) merchant’s firm contract; (iii) reliance; (iv) performance
In a unilateral contract, the offeree must ______ of the offer at the time he performs.
Know (be aware of)
A revocation of an offer is effective upon ________
Receipt [no mailbox rule]
An offer terminates when an offeree (i) _______ it, or (ii) gives a _________ (though, not just “mere bargaining”); or (iii) accepts the offer with __________, or (iv) accepts and adds _____ (though different with UCC).
(i) rejects; (ii) counteroffer; (iii) conditions; (iv) terms
Mailbox rule: (both common and UCC) acceptance is valid upon _______
Dispatch
In the common law, an offeree who responds with new terms (i) _________ the offer, and creates a new offer, because the common law contracts requires the (ii) _____ _____ rule.
(i) rejects; (ii) mirror image
Under the UCC, additional terms do not prevent acceptance (reject offer), but only if both parties are (i) ________, the new term is not a (ii) _________ change, and (iii) there is no __________ to it within a reasonable time.
(i) merchants; (ii) material; (iii) objection
If the dispatch does not reach the recipient, because there was an error in delivery (e.g., bad address), then acceptance is effective upon _________.
Receipt
If a new term is __________ in the industry, it’s not material
Customary
Death of _______ party terminates a revocable offer (but not a contract)
either
Starting (i) _________ is a form of acceptance of a contract in a bilateral contract, and it
performance
For an options contract to be enforced under common law, it must include ___________.
Consideration
A merchant’s firm offer requires no ___________ from the offeree (unlike the common law).
Consideration
An offer by a merchant, in a (i) _____ _______, which by its terms gives assurance that it will be held (ii) ______ is irrevocable during the time stated (or a reasonable time, not to exceed 90 days).
(i) signed writing; (ii) open
(i) _________ is generally not valid acceptance, though it can be if “custom creates duty to (ii) _______” (eel skins case)
(i) silence; (ii) speak
UCC Gap filler rule: the court can fill-in (i) ________ terms, but it can never fill in (ii) ________, which is the one term that must exist in every single UCC contract. The exceptions are the Output and Requirements contracts.
(i) reasonable; (ii) terms
In a requirements contract, (i) ________ is measured by the buyer’s (ii) _____ _______ needs.
(i) quantity; (ii) good faith
The Mailbox rule can does not work if the contract expressly states otherwise, or has a clearly stated revocable _______.
Date
In a requirements contract, the buyers orders must be (i) _______ to orders in the past.
(i) proportionate
Unlike an acceptance, which is valid on (i) __________, a rejection is valid upon (ii) ________.
(i) dispatch; (ii) receipt
Consideration is a (i) _______-for legal cost or benefit.
(i) bargained
There is no such thing, in a contract, as (i) _______ consideration; it is not valid.
(i) past
In order to modify a common law contract, (i) new _______ is required. However, where the parties agree to a change, the court may still enforce the contract if the modification is a result of changed circumstances, and the change is (ii) _____ and ________.
(i) consideration; (ii) fair and equitable
In a UCC contract, no new (i) __________ is needed to modify a contract, so long as the change is made in (ii) _____ _______.
(i) consideration; (ii) good faith
Promise to pay an already-due, uncollected debt, is not (i) _________. The exception is a promise to pay a (ii) ______-_______ debt; a written promise to pay a (iii) _____-______ debt is enforceable without consideration.
(i) consideration; (ii) time-barred; (iii) time-barred
Moral obligation is not a valid substitute for (i) ________.
(i) consideration
(i) _______ _________ and (ii) ______ _______ are the equitable remedies for making a contract enforceable, even where there was no consideration.
(i) promissory estoppel; (ii) foreseeable reliance
(i) ______, (ii) the __________, and the (iii) _____ _____ do not have capacity to contract.
(i) minors; (ii) intoxicated; (iii) mentally incompetent
A defendant who did not have the capacity has the right to (i) _______ the contract, but he may accept it.
(i) disaffirm
If a (i) ________ retains the benefits of a contract after turning 18, he has implied affirmation, and it’s a valid contract.
(i) minor
A party who contracts without capacity is still liable for (i) _________ (food, shelter, clothing, medical care), but only at their (ii) ______ ________, not the contract price
(i) necessity; (ii) reasonable value
MYLEGS:
Marriage; Term of Years; Land Sale Contract; Executory Contracts; Goods (>=$500); Sureties
UCC 2-201 states that the sale of goods greater than or equal to $500 require a contract in ________.
Writing
A court can refuse to enforce all or parts of a contract if there are (i) ______ and ________ terms, tested as of the time the (ii) _______ was made.
(i) unfair and oppressive; (ii) agreement
A contract will be held invalid under (i) ______ if the other party makes an (ii) _____ _________, and there was no reasonable (iii) ________.
(i) duress; (ii) improper threat; (iii) alternative
A promise to marry is not a contract to marry, and therefore does not have to be in __________ (SOF).
Writing
Under the UCC, if an offeree accepts an offer and at the same time makes a material alteration to the other, the contract is under the terms of the (i) ______ _____, and the material alteration is (ii) _______.
(i) first offer; (ii) excluded
A services contract which cannot possibly be completed in a ________ must be in writing. But if it’s possible it could be under a year, it may be oral without violating the SOF.
Year.
Under the UCC, if the offeree makes acceptance (i) _______ upon ascent to an additional term, it is a (ii) ________, and battle-of-the-forms does not apply.
(i) condition; (ii) counteroffer
Under common law, clauses that prevent (i) ______ medication are unenforceable, unless the modification is subject to the SOF>
orar
UCC Article 2 requires a contract contain a (i) ________, and be (ii) _______ by the party charged with breach.
(i) quantity; (ii) signed
Under the common law, a contract must include all (i) _____ ________, and be signed by the defendant.
Material terms
If a Land Contract is not in writing, it can be satisfied (but not necessarily) by part performance, by proving two of these three elements: (i) _______, (ii) _________, and/or (iii) _______.
(i) payment; (ii) possession; (iii) improvements
Full performance will cure a contract that violates the statute of (i) _______, but partial performance will not; partial performance is subject to the remedy of (ii) ________.
(i) frauds; (ii) restitution
Under the UCC, if a defendant admits under oath that there was a (i) ______, the admission will cure any issue with he statute of frauds.
Contract
If a contract for custom-made goods (>$500) is not in writing, a (i) ______ ________ in production will cure any SOF deficiencies.
substantial beginning
If a mutual mistake goes to the (i) _______ of the contract, then the mistake is grounds for (ii) _______.
(i) essence; (ii) rescission
Unilateral mistake does not prevent contract (i) ________; however, in all unilateral mistake, if the non-mistaken party (ii) _______, or had reason to ________, then the non-mistaken party will not be allowed to take advantage of the mistake.
(i) formation; (ii) knows
A Merchant’s (i) ________ ___________ can satisfy the SOF if both parties are (ii) _____________, a confirmatory writing includes (iii) ________ and terms, and there’s no (iv) written _________ within four days.
(i) confirmatory memo; (ii) merchants; (iii) quantity; (iv) objection
The (i) _____ _______ rule keeps out evidence of a prior or contemporaneous agreement that contradicts a later writing.
(i) parol evidence
Exceptions to the parol evidence rule include evidence that corrects a (i) ______ ______, or a document that establishes a (ii) ______ that a contract was never formed.
(i) clerical error; (ii) defense
A seller can disclaim all (i) ______ warranties, but not (ii) ________ warranties. Implied warranty means that the goods are fit for the buyer’s (iii) _______ _______. If the seller knows the buyer has a special purpose and is relying on the merchant to select suitable goods, failure of the goods to comply will be a breach of contract.
(i) implied; (ii) express; (iii) particular purpose.
When a seller delivers a nonconforming deliver of goods (non-perfect / non-conforming tender) to the buyer, the delivery is simultaneously acceptance and breach of contract. The buyer has three options: (i) accept the goods and pay the _______ _______; (ii) timely reject and sue for __________; (iii) the buyer can accept _____ of the delivery, and _______ the rest
(i) contract price; (ii) damages; (iii) some; reject
A notice of __________ in delivery of non-conforming tender is a counter-offer (not an acceptance and breach). This notice gives the buyer the choice of accepting the non-conforming goods, or returning them (at the seller’s cost) for a new delivery.
Accommodation
When a non-breaching party covers, they recover the difference between the cover price and the (i) ______ price; this is the standard remedy under the UCC. The cover price need not be the market price or the lowest bid, but it need be reasonable (for the same good).
contract
A contract that is FOB to the Seller’s City is a Shipment Contract. A Contract that is FOB followed by any other city is a destination contract. In a shipment contract, the seller must get the goods to a (i) ______ _______, (ii) ______ the buyer, and then risk shifts to the buyer. In a Destination Contract, the seller bares the risk until the Goods arrive to the Buyer.
(i) common carrier; (ii) notify
If the buyer is picking-up the goods from a merchant, the merchant bears risk until the buyer (i) _____ _______; but if the buyer is picking up goods from a non-merchant, the risk-of-loss shifts to the buyer as soon as the non-merchant (ii) __________ (makes them available to buyer)
(i) takes possession; (ii) tenders
Contracting parties can cancel or amend a contract prior to a 3rd party’s rights (i) ______; thereafter, a change or cancellation requires the 3d party to (ii) ________. A 3d party beneficiary can vest their rights when they (iii) _____ and ______ to the contract; (iv) learn and _____ on the contract; (v) learn and immediately ______ to enforce rights.
(i) vests; (ii) assent; (iii) learn and assent; (iv) learn and rely; (v) learns and sues
Under common law, perfect performance is not required; (i) _________ performance is required, meaning that there is no (ii) __________ breach.
(i) substantial; (ii) material
Under the UCC, a seller who fails to make perfect tender may be able to cure. If (i) ________ under the contract has not yet expired, the seller may cure; (ii) if time has expired, cure may be allowed if there were _____ _______ to think the buyer would accept.
(i) time; (ii) reasonable grounds
If a buyer of goods keeps the goods after having an (i) _______ to ________, there’s implied acceptance. However, if the buyer later discovers a (ii) _________ defect, the buyer may be able to revoke.
(i) opportunity to inspect; (ii) latent
Once a buyer (i) _______ delivery, it’s too late to (ii) ______, but for non-perfect tender, (iii) _______ may still be available.
(i) accepts; (ii) reject; (iii) damages
If a buyer validly rejects a delivery, he can (i) ______ the goods at the seller’s expense, (ii) get a ______ of any money paid, and get (iii) ______.
(i) return; (ii) refund; (iii) damages
An (i) __________ repudiation provides an excuse. You cannot retract your repudiation (anticipatory breach) if the other party has (ii) ________ on your repudiation.
(i) anticipatory; (ii) relied
A party with (i) ______ _______ for being insecure may, in writing, request additional assurances. Without those adequate assurances, the party can defend against any breach.
(i) reasonable grounds
An (i) _______ is an agreement to accept a different (ii) ________ in future satisfaction of an existing duty. The underlying duty is (iii) ________, but it is not excused until the (iv) ________ is satisfied.
(i) accord; (ii) performance; (iii) suspended; (iv) accord
A (i) _______ is an agreement to substitute a new party for an existing one.
(i) novation
A later, (i) __________ event that makes performance (ii) _________ may provide the seller with an excuse for performance. An act of God will qualify.
(i) unforeseen; (ii) impossible
Destruction of a (i) ______ _______ of the contract is an excuse for non-performane
(i) subject matter
In an Act of God, a seller who has born the risk of loss may be excused due to (i) ________, but only if the goods for shipment to the buyer were (ii) ________.
(i) impracticability; (ii) identified
(i) _______ compliance is required for (ii) _______ conditions in the contract. Look for words like “if”, “as long as,” “provided that”
(i) strict; (ii) express
Generally, all contracts are (i) ________ and (ii) ________ except for (iii) ________ personal services and long-term (iv) _______ contracts.
(i) assignable; (ii) delegable; (iii) unique: (iv) requirements
Equitable remedies are generally only available in contract if monetary damages are (i) _________.
Inadequate
A (i) ___________ assignment is freely revocable, whereas an assignment (ii) for _______ is irrevocable.
(i) gratuitous; (ii) value
Generally, a seller cannot reclaim its goods for non-payment. However, it may be able to reclaim the goods if the buyer is (i) _________ when it receives the goods, and the seller demands return within 10 days, or the buyer (ii) _________ _________ to the seller in writing, within three months prior of the delivery date.
(i) insolvent; (ii) misrepresented solvency
Under common law, damages are for (i) _______ losses.
expectation
Under the UCC, the Buyer has 3 damage options: (i) _______ (difference in price paid in good faith and contract price); (ii) _________ price minus contract price (if cover was not in good faith or doesn’t cover at all); (iii) value as promised minus value as ___________ (if buyer keeps the non-conforming goods).
(i) cover; (ii) market; (iii) delivered
If the breaching party sues under a services contract, they are entitled to the (i) _______ ________ of service provided, minus the (ii) __________ ________ by the non-breaching party.
(i) reasonable value; (ii) damages incurred
Under the UCC, if a buyer breaches and does not accept delivery, the seller has three options for damages: (i) ______ damages (contract price minus resale price, if sold in good faith); (ii) ________ damages (contract price minus market price, even if no re-sell); (iii) ______ _______ (if goods cannot e resold, like custom-made goods).
(i) resale; (ii) market; (iii) contract price
If the seller is a (i) _____ dealer, and the buyer breaches, the seller is able to gain lost (ii) _______.
(i) volume; (ii) profit
Costs to the injured buyer or seller for transporting and caring for goods, or arranging for a substitute transaction, are always (i) __________.
(i) recoverable
An injured party in a common law contract cannot recover damages if he did not attempt to (i) _______.
(i) mitigate
If multiple parties are assigned a contract for value, the (i) _______ assignment wins.
First
A contract can expressly (i) _______ assignment
expressly
An owner who (i) ________ his goods to a merchant who deals in those kinds of goods has no rights against a future (ii) _____ _______ purchaser. He will have rights against the merchant, but not the new owner.
(i) entrusts; (ii) bona fide purchaser
Under the UCC, an offer to buy goods for current or prompt shipment is accepted upon (i) ______ or (ii) a promise to ________
shipment; ship
Under the UCC, if any party is not a (i) _________, then the additional terms are mere (ii) __________ to modify the contract, and do not take effect unless the offeror expressly agrees.
(i) merchant; (ii) proposals
If an offeree sends a rejection and then an acceptance (separately), the ______ to _________ is effective (exception to the mailbox rule)
First to arrive
If an offeree sends an acceptance, and then a rejection, the acceptance is effective (mailbox rule) unless the rejection arrives _______ and the offeror ______ ______ on the rejection
first; detrimentally relies
Promissory Estoppel / Detrimental Reliance: (i) ______ is not necessary if the promisor should reasonably expect to (ii) _______ action or forbearance and such action or forbearance is (iii) _______ induced. The Second Restatement of Contracts provides that a remedy “may be limited as justice requires.”
(i) consideration; (ii) induce; (iii) actually
In an ambiguous term, (confusion / misunderstanding), if neither party is aware, there is (i) ___ _______ unless the parties intended the same meaning; there is (ii) ___ _____ if both parties are aware, unless they intended the same meaning, and where one party is aware, the contract binds based on what the (iii) _______ party reasonably believed the term to mean.
(i) no contract; (ii) no contract; (iii) ignorant
Signature should be broadly construed, and includes typed signatures, initials, and even formal ________
letterhead
If the statute of frauds is not raised as a (i) ______ in the (ii) _______, it is waived.
(i) defense; (ii) answer
Common instance of unconscionable contracts include: (i) fine print that ________ shifts _______ to an unusual party; (ii) contracts of _______, that give a “take it or leave it” option to a signer who cannot otherwise procure such goods; (iii) an ________ clause that limits negligence liability (unless a hazardous activity); and (iv) a contract that inconspicuously limits _______, and the only remedy provided is terrible.
(i) inconspicuously, risk; (ii) adhesion; (iii) exculpatory; (iv) remedies
