Contracts Flashcards
for express condition, check whether it obligates the buyer or the seller to perform
if obligates buyer to perform (if I get a 10% max interest rate, I must pay), and buyer doesn’t meet the condition but waives it (I got 11% rate, ugh, but I still wanna buy so I’ll waive), then seller must still perform
does applying the four corners rule mean that a completely integrated contract must be ascertained solely from its own terms?
no, still allows extrinsic evidence to clear up an ambiguity
does the exact third party need to be known at time of a third-party-beneficiary contract is made?
no, if mom promises to pay purchase price to anyone from who son buys a minivan, then the in the future, the minivan Co. can force her to pay
**is suretyship Statute of Frauds signing requirement trigged when Dad (guarantor) promises to borrower (Son), creditor (Uncle), or both, that Dad will cover debt? And to who does the signed writing need to be given?
to trigger signed writing requirement, promise must be from Dad (guarantor) to creditor (Uncle). as long as Dad (guarantor) made the signed writing (even later), it can be physically given from Dad to either. Amount under 1K is okay
**Debtor owed creditor 1K by today. Creditor told debtor that if pays the 1K by next month, he won’t sue. Debtor agreed. Next day, creditor sued debtor. That okay?
yes, pre-existing duty rule. No consideration given by debtor for forbearance on something already due (non-goods Ks only)
buyer asks dealer whether car had been in accident, dealer says fine car, assures quality, but car had been in major accident and dealer had repainted/repaired car to conceal accident evidence. okay?
no because buyer asked direct question and seller gave answer that would reasonably be taken as an assurance that seller at least didn’t know of car’s involveement in an accident (plus he actively concealed, so he knew and was making it seem like it wasn’t, even though he didn’t directly answer with No)
if the seller seasonably notifies the buyer that the shipment of non-conforming goods is being offered only as an accommodation to the buyer (“here’s red, I didn’t have the blue you requested”), is the shipment of the non-conforming goods nevertheless a breach?
no. buyer can accept, forming K; or reject, meaning no K was formed (because was accommodation offer)
underaged teen promises to pay $400 for TV set (delivered that day) when he turns 18. On day he turns 18, TV set is worth $250, and teen promises to pay $300 in signed letter. what’s max that seller can recover?
$300. when underaged, minor has voidable rights. his letter on his bday ($300) disaffirmed the $400 promise when he was a minor
**duress vs undue influence
duress requires an improper threat (threatening not to visit mom anymore in hospital is not enough)
undue influence: undue susceptibility to pressure + excessive pressure (eg mother’s illness, confidential relationship, like parent-child)
when a RETAILER makes a firm offer (“we won’t change catalog prices for the coming year”), for how long is that valid, and does it require consideration?
because it’s a merchant’s offer, it’s irrevocable for the length mentioned, but MAX 3 months (so if offered mid Dec, it’s irrevocable for Dec, Jan, Feb)
“F.O.B. seller’s places of business” means that, when seller places items on board a carrier, and the items are destroyed in transit, who loses?
F.O.B. means free on board (seller must get item to shipper to be free of liability), and it’s always followed by a location (here, SELLER’s place of business), and the risk of losses passes to the BUYER at that location (so buyer lost)
**to be an intended beneficiary, what 3 factors are examined?
1) beneficiary could’ve reasonably relied on fact that a purpose of the K was to confer a right on her
2) performance supposed to run directly from a contracting party to her
3) if part of overall objective of parties was to benefit her
(hospital patients are NOT intended beneficiaries of hospital-janitor K)
for how long can a homebuyer sue for fraud/misrepresentation (which voids K, even if K is still fair terms despite it)
when he learns of it/has to reason to know of it
woman has mortgage on house. gives to friend “subject to a mortgage to the bank, which the grantee assumes and agrees to pay. Friend conveys home to son “subject to an existing mortgage to the bank.” who can bank go after if defaults?
the first two. Person 2 assumed and “AGREES” to cover mortgage, but that does not relieve the OG (unless OG gets BANK’s permission to be let go).
Third person isn’t liable because they didn’t AGREE to pay the mortgage, even though it was “subject to an existing mortgage”
when a land-sale K calls for a buyer to deposit earnest money, the seller [may / may not] retain that earnest money as liquidated damages in case of a breach
may
where the seller’s losses exceed the amount of earnest money, the seller may keep the earnest money as liquidated damages (that shows that the earnest money wasn’t an insanely excessive estimate of actual damages)
if neither party is aware of an ambiguity within the terms of the K (eg that “oldest motorcycle” meant 1985 or 1987 one because one wasn’t aware that he had an 1985 one), then a mutual mistake has occurred. Can dissatisfied buyer win for breach of K?
no because mutual mistake = no K (so no breach)!
is a minor’s promise to pay $100 for something enforceable?
no because she’s a minor; once she reaches of age, not voidable
when a promise is voidable, the promisor may later reaffirm the promise, even w/o new consideration, and it’ll still be enforceable (eg promises something as a kid (voidable), then reaffirms as adult w/o consideration (enforceable)
**if parties put a “no oral modification” clause in a K, does the UCC make it enforceable?
yes, but does NOT apply to services (lotsss of talking in services K)
is consideration exempt from a subsequent oral modification when it’s re: an honest dispute about a legal duty owed?
yes, no consideration necessary there
consequential damages
indirect losses reasonably foreseeable due to breach (if S had no idea B would use them for grazing cows, then S doesnt need to pay)
does modification of UCC contract require consideration? what about for common law?
no consideration for UCC; yes for common law
“I’ll sell you 5 acres of my 100-acre plot.” Is the reasonably specific?
no, vague, unenforceable
do you need separate consideration to support an option (‘K term: u can purchase the land at the end of the lease’) that is a term under an existing contract?
no - the option is simply one of the rights purchased by the lessee
seller tells potential buyer: “you can buy any or all of my lots”
Buyer say accepts offer w/r/t Lot 101.” By saying so, is he implicitly rejecting the offer to purchase the remaining lots?
yes :O and his rejection termination his power to accept the remaining lots
Seller offered all of his 50 lots for sale. Buyer accepted buying one, then accepted to buy all. Seller then realized he didn’t actually own 49 of them…can performance be excused by impossibility of performance?
no because he should’ve known he didn’t own them or it’s his fault he didn’t know - can’t excuse as impossibility/impracticability
cops offer reward for info that leads to arrest + conviction of fugitive. Teacher finds him, but cops ultimately negotiate w/ fugitive so he doesn’t get convicted but rats out boss. does teacher get reward even though no conviction?
yes because a condition’s non-occurrence (non-occurrence of conviction) is excused (which means P meets the condition) because offerer must refrain from conduct that prevents/hinders occurrence of the condition (here, prevented it by negotiating to avoid conviction)
reward doesn’t become due until performance of conditions is met
P and D enter K, where D serves essential position of on-site supervisor for construction of office building. D gets injured, offers to serve as off-site consultant for same pay. Can P win for damages resulting from failure to perform?
no because incapacity = performance is impracticable, so P’s excused, not in breach (physical ability to perform was a basic assumption of the K)
if B signs two contracts with S (one for soybeans, another for wheat), and S says he can’t perform on wheat because creditor won’t supply S w/ enough, can B demand for reasonable assurances about upcoming performance of soybean delivery, even though the K is separate?
yes, because B now has reasonable grounds for insecurity
