Contracts 2A Flashcards
Contract
is a promise or a set of promises for
the breach of which the law gives a remedy
§2. Promise
manifestation of intention to act
or refrain from acting in a specified way, so made as to justify a promise in understanding that a commitment has been made
promisor
The person manifesting the intention is the ______
promisee
The person to whom the manifestation is
addressed is the _______
How a Promise May Be Made
A promise may be stated in words either oral or written, or may be inferred wholly or partly from conduct.
§17. Requirement of a Bargain
(1) Except as stated in Subsection (2),the formation of a contract requires a bargain in which there is a manifestation of mutual assent to the exchange and a consideration.
(2) Whether or not there is a bargain a contract may be
formed . . . under the rules stated in §§82 –94.
§3. Agreement Defined;
An agreement is a manifestation of mutual assent on the part of two or more persons.
§3. Bargain Defined
A bargain is an agreement to exchange promises or to exchange a promise for a performance or to exchange performances.
§22. Mode of Assent: Offer and Acceptance
(1) The manifestation of mutual assent to an exchange ordinarily takes the form of an offeror proposal by one party followed by an acceptance by the other party or parties.
§24. Offer Defined
An offer is the manifestation of willingness to enter into a bargain, so made as to justify another person in understanding that his assent to that bargain is invited and will conclude it.
§26. Preliminary Negotiations
NOT AN OFFER
if the person to whom it is addressed knows or has reason to know that the person making it does not intend to conclude a bargain until he has made a further manifestation of assent.
bilateral contract
results from exchange of promises
unilateral contract
results from exchange of a
promise for a performance
§35. The Offeree’s Power of Acceptance
(1) An offer gives to the offeree a continuing power to complete the manifestation of mutual assent by acceptance of the offer.
(2) A contract cannot be created by acceptance of an offer after the power of acceptance has been terminated in one of the ways listed in §36.
§36. Methods of Termination of the Power of
Acceptance (4 items)
(a) rejection or counter-offer by the offeree, or
(b) lapse of time, or
(c) revocation by the offeror, or
(d) death or incapacity of the offeror or offeree.
§38. Rejection (of offer rules)
(1) An offeree’s power of acceptance is terminated by his rejection of the offer, UNLESS the offeror has manifested a contrary intention.
(2) A manifestation of intention not to accept an offer is a rejection UNLESS the offeree manifests an intention to take it under further advisement.
§39. Counter-Offers
(1) A counter-offer is an offer made by an offeree to his offeror relating to the same matter as the original offer and proposing a
substituted bargain differing from that proposed by the original offer.
(2) An offeree’s power of acceptance is terminated by his making of a counter-offer, unless the offeror has manifested a
contrary intention or unless the counter-offer manifests a contrary intention of the offeree.
§41. Lapse of Time
(1) An offeree’s power of acceptance is terminated at the time specified in the offer, or, if no time is specified, at the end of a reasonable time.
(2) What is a reasonable time is a question of fact, depending on all the circumstances existing when the offer and attempted acceptance are made.
(3) Unless otherwise indicated by the language or the circumstances, and
subject to the rule stated in §49, an offer sent by mail is seasonably accepted if an acceptance is mailed at any time before midnight on the day on which the offer is received.
§42. Revocation
An offeree’s power of acceptance is terminated when the offeree receives from the offeror a manifestation of an intention not to enter into the proposed contract.
§63. Time When Acceptance Takes Effect
Unless the offer provides otherwise,
(a) an acceptance made in a manner and by a medium invited by an offer is operative and completes the manifestation of mutual assent as soon as put out of the offeree’s possession, without regard to whether it ever reaches the offeror; but
(b) an acceptance under an option contract is not operative until received by the offeror.
§56. Acceptance by Promise; Necessity of Notification to Offeror
Except as stated in §69 or where the offer manifests a contrary intention, it is essential to an acceptance by promise either that the offeree exercise reasonable diligence to notify the offeror of acceptance or that the offeror receive the acceptance seasonably.
§66. Acceptance Must Be Properly Dispatched (snail mail rule)
An acceptance sent by mail or otherwise from a distance is not operative when dispatched, unless it is properly addressed and such other precautions taken as are ordinarily observed to insure safe transmission of similar messages.
§59. Purported Acceptance Which Adds Qualifications
A reply to an offer which purports to accept it but is conditional on the offeror’s assent to terms additional to or different from those offered is not an acceptance but is a counter-offer.
§43. Indirect Communication of Revocation (offeree indirect revoke)
An offeree’s power of acceptance is terminated when the offeror takes definite action inconsistent with an intention to enter into the proposed contract
AND
the offeree acquires reliable information to that effect.
§30. Form of Acceptance Invited
(1) An offer may invite or require acceptance to be made by an affirmative answer in words, or by performing or refraining from performing a specified act, or may empower the offeree
to make a selection of terms in his acceptance.
(2) UNLESS otherwise indicated by the language or the circumstances, an offer invites acceptance in any manner and by
any medium reasonable in the circumstances.
§50. Acceptance of Offer Defined;
Acceptance by Performance;
Acceptance by Promise
(three different have different acceptances)
(1) Acceptance of an offer is a manifestation of assent to the terms thereof made by the offeree in a manner invited or required by the offer.
(2) Acceptance by performance requires that at least part of what the offer requests be performed or tendered . . . .
(3) Acceptance by a promise requires that the offeree complete every act essential to the making of the promise.
Tender (definition)
An unconditional offer to perform
coupled with:
(1) a manifested ability to carry out the offer; AND
(2) production of the subject matter of the tender.
§32. Invitation of Promise or Performance (in doubt of offer being Promise or Performance)
In case of doubt an offer is interpreted as
inviting the offeree to accept either by
promising to perform what the offer
requests or by rendering the performance,
as the offeree chooses.
§45. Option Contract Created by Part Performance or Tender
(1) Where an offer invites an offeree to accept by rendering a performance
AND does NOT invite a promissory acceptance,
an option contract is created
-when the offeree tenders
-OR begins the invited performance
-OR tenders a beginning of it.
(2) The offeror’s duty of performance under any option contract so created is conditional on completion or tender of the invited performance in accordance with the terms of the offer.
§25. Option Contracts
An option contract is a promise which meets
the requirements of a contract AND limits the
promisor’s power to revoke an offer.
§37. Termination of Power of Acceptance
Under Option Contract
Notwithstanding §§38–49, the power of
acceptance under an option contract is NOT
terminated by
-rejection or counter-offer
-by revocation,
-or by death or incapacity of the offeror
ONLY LASPE OF TIME
