Contracts Flashcards
Mitigation Expenses
A plaintiff is entitled to recover reasonable expenses incurred in seeking to mitigate after the breach, as long as reasonable. An unsuccessful attempt to mitigate does not mean that the expense is not recoverable.
Adequate Assurances
Under UCC 2-609, a party to contract who has reasonable grounds for insecurity is entitled to request assurances, and is also entitled to suspend performance pending receipt of that assurance.
Buyer’s Reliance on a Material Misrepresentation
A buyer is entitled to rely on the truth of material misrepresentations made by a dealer and need not conduct any independent tests to see whether the dealer is lying, even if such an independent test would reveal the lie.
Material Misrepresentation
When a seller induces a buyer’s consent to a contract by means of a material misrepresentation, the resulting contract is voidable at the election of the buyer.
Assignee Rights
An assignee succeeds to a contract as the contract stands at the time of the assignment.
UCC Expectation Damages
A seller is entitled to the profit the seller would have made, plus an allowance for costs reasonably incurred, minus payments received for resale of the goods.
(Profit + costs incurred - resale)
Statue of Limitations Consideration Exception
A promise to pay a debt after the running of the applicable statue of limitations is enforceable without consideration.
Acceptance of Offer to Buy Goods for Prompt Shipment
Under 2-206, an offer to buy goods for prompt shipment is accepted when the seller ships or promises to ship the goods.
Who controls when inconsistent?: Course of Dealing or Trade Usage?
A course of dealing, when inconsistent with a usage of trade, controls under UCC 1-303.
UCC Parol Evidence
While a final written expression of agreement may not be contradicted by any prior agreement, it may be explained or supplemented by course of dealing or usage of trade or by course of performance.
A course of dealing, when inconsistent with a usage of trade, controls under UCC 1-303.
Divisible Contract Damages
The rules for damages permit the separable components to be treated separately.
Statue of Frauds Writing Requirement: When does it need to be written?
The writing required to satisfy the statue need not be written at the time of the making of the promise, nor need it be a writing addressed to the promisee - as long as parties identified.
Different Meanings to the Same Material Term (Common Law)
When parties attach significantly different meanings to the same material term, the meaning that controls is the one “attached by one of them if at the time the agreement was made…that party did not know of any different meaning attached by the other, and the other knew the meaning attached by the first party.
Unforeseeable Consquential Damages
Are not recoverable unless the breaching party had some reason to know about the possibility of these unforeseeable damages.
Doctrine of Prevention
Requires that a party refrain from conduct that prevents or hinders the occurrence of a condition.
General Expectation Formula
Loss in value + other loss - cost avoid - loss avoided
Name one Circumstance where an addional term does not become a term of the parties’ contract under the UCC.
Where an additional term materially alters the parties’ contract.
Acceptance of non-conforming goods
If a buyer accepts a shipment of non-conforming goods, the seller may bring an action to recover the contract price of the goods. However, the seller’s reward will be reduced by any reasonable losses that resulted from the seller’s breach.
Constructive Condition
A constructive condition is one not agreed on by the parties, but which courts impose as a matter of law, in order to ensure fairness
Time Period within which a party may avoid a contract due to misrepresention
The time period does not begin to run until that party either knows or has reason to know of the misrepresentation.
Common Law Expectation Damages
1) loss in value to the non-breaching party;
2) any other loss, including incidental or consequential loss, caused by the breach; less
3) any cost or other loss that the non-breaching party has avoided by not having to perform.
UCC Trade Usage
Under the UCC, any trade usage that is observed with sufficient regularity so as to justify an expectation that the parties contracted with reference to it can be introduced to interpret the parties’ agreement, so long as the usage can be reasonably construed as being consistent with the express terms of the contract.
UCC Trade Usage
Evidence of a trade usage that can be construed as reasonably consistent with an agreement’s express language is admissible to interpret or supplement an agreement. The majority rule provides that trade usage will be viewed as consistent with an agreement’s express language unless the usage completely negates specific express language.
Admissible even if the parties intended the agreement to be completely integrated.
Who bearers the burden of proving the condition required for enforcement has been satisfied
As the party who benefits from this eventual performance, the seller bears the burden of proving the condition required for enforcement has been satisfied.
