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Contracts Flashcards

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1
Q

UCC Statute of Frauds Requirements

A

 signed writing (1) w. basis to believe real transaction (2) w. quantity (or obvious, or output/requirement) NOT offer  firm

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2
Q

implied warranty of title

A

good title/rightful transfer/no liensModified if (1) specify in language (2) buyer reason to know OJO MD no modification for consumers, SoL 4 years

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3
Q

Implied warranty of merchantability

A

IF both merchants, fit for ordinary purpose Mod if use the word, conspic. No requirement of privity – sue anyone in manu chain, show defect. OJO MD no modification for consumers, SoL 4 years.

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4
Q

Parol Evidence Rule

A

 explain/interp → admissible (min: terms must be ambiguous)  supplement → admissible UNLESS complete integration OJO! Course/usage in UCC admissible  contradict →admissible UNLESS fully integrated OJO! UCC course/usage can qualify integrated term
OJO! applies to written evidence as well.

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6
Q

Parole Evidence Rule not applicable if:

A

 subsequent agreements OJO unless no oral mod agreement  collateral (entirely distinct, e.g. an overtime provision) agreements → admissible  to attack validity of agreement (1) oral condition precedent (2) no consideration (3) mistake/duress/fraud(min: not where writing says otherwise) (4) reformation claim – from fraud or mutual mistake (a) antecedent valid agreement (b) incoherently reflected in writing (c) clear and convincing evidence

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7
Q

Implied warranty of fitness for particular purpose

A

IF seller had reason to know (1) purpose (2) buyer relying Mod: in conspicuous writing (1) as is, with faults (2) buyer has/refused inspect, apparent (3) course of deal OJO MD no modification for consumers, SoL 4 years

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8
Q

Mutual Mistake

A

voidable if (1) essential (2) both (3) disadvantaged didn’t bear risk

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9
Q

Unilateral Mistake

A

not excused UNLESS other reason to know OR clerical error EXCEPT (1) extreme negligence (2) reliance

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10
Q

Frustration of Purpose

A

1) principal purpose (2) substantial frustration (3) was basic assumption (4) no risk allocation

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11
Q

Anticipatory Repudiation: Retraction

A

retract repudiation until (1) other party relies (2) accepts (3) sues

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12
Q

Perfect tender rule: Rejection

A

(1) w/in reasonable time (2) states defect if asked or opp to cure (3) follow instructions from seller on storing or make reasonable efforts to sell. Right not impaired by prompt payment clause: can pay and still inspect. → can sue for damages, get reimbursement

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13
Q

Perfect Tender Rule: Revoke Acceptance

A

if (1) nonconform substantially impairs value AND (2) had reasonable assumption that would be cured and wasn’t OR (3) acceptance induced by difficult discovery or seller assurances w.in reasonable time of (should have) discovered -> same rights as reject OJO must give notice

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14
Q

Anticipatory Repudiation: Aggreived Party

A

(1) definitive statement (2) act rendering unable to perform → if reasonable grounds seek assurance UCC writing CL either, suspend if (1) commercially reasonable (2) no return OR (1) no response w/in reasonable UCC 30 days (3) response not assuring → cancel / sue, ignore no

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15
Q

Perfect tender rule: Rejection

A

(1) w/in reasonable time (2) states defect if asked or opp to cure (3) follow instructions from seller on storing or make reasonable efforts to sell → can sue for damages, get reimbursement

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16
Q

Fraudulent Misrepresentation

A

(1) oral, written, conduct (2) knowing or reckless (3) intent to mislead (4) material (5) reasonable reliance -> power of avoidance, recission, reliance damages →misrep also live w. K and sue for benefit of bargain as tort/warranty

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17
Q

Negligent/Innocent Misrepresentation

A

(1) inconsistent (2) material (3) reasonable reliance (4) would have known w/care OR happened (innocent) → power of avoidance, recission, reliance damages

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18
Q

Duress

A

(1) threat (2) that’s wrongful (econ duress, crim, wrong civil) (3) no reasonable choice (no substitutes, breach Ks, suing inadequate, min: protest) (4) if threat from 3rd party, other party doesn’t rely and knows → physical void, other voidable, undo benis

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19
Q

Fraudulent Nondisclosure

A

(1) material (2) reasonable reliance (3) aware of and unlikely other will discover AND one of: A. trust/confidence relationship B. assertion true at time no longer C. obligation of good faith -> power of avoidance, recission, reliance damages

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20
Q

Sole source defense

A

if (1) was mutually contemplated (2) not foreseeable (3) seller all due measures to ensure not failing

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21
Q

Option K v. Firm Offer

A

 option K in CL: (1) offer (2) subsidiary promise to keep open (3) consideration for promise
OJO!  (min: false recital ok)  PromEst for reliance  construction implied opt K w/ PromEst
 firm offer in UCC: (1) merchant (2) in writing signed (3) expressly states held open NO consid.
OJO! < 3 months → can make CL option K to get around. Only terminated if (1) other party rejects AND (2) offeror reasonably relies on rejection

22
Q

Transcription error

A

Writing can be reformed to reflect intention of parties

23
Q

3rd Party Beneficiary: Vesting

A

An intended third-party beneficiary’s rights vest (1) once they have notice of and assent to the contract or (2) once they demonstrate reliance on the benefit. (3) 3rd party sues (4) express

24
Q

Rights/Duties of Delegator/ee

A

Delegator remains liable to obligee unless there is novation. Delegatee is liable to delegator directly and to obligee under 3rd party beneficiary theory.

25
Q

Quasi-contract

A

An action in quasi-contract can make an injured party whole if a contract fails because of a failure of a condition or a breach, and specific performance is not possible or desirable. An action at quasi-contract is essentially an action for restitution. OJO! can happen when there was a real K.

26
Q

Impracticability

A

1) war or embargo, 2) local crop failure, 3) unforeseen shutdown of major sources of supply, or 4) labor strike; and (b) the shortage either caused a marked increase in cost or prevented the seller from securing the supplies necessary for his performance.

27
Q

Statute of Frauds: Land

A

Can be satisfied by PART PERFORMANCE that unequivocally refers to a contract; that is, it consists of acts that would not have occurred unless a contract for sale existed between the parties. (This is an evidentiary function for the part performance.) This usually means that the buyer 1. has paid part or all of the purchase price, and 2. has taken possession of the property and 3. made improvements thereon (or some combination of payment and possession or improvements)

28
Q

Executed gift

A

delivery of an item with an intention to bestow a gift

29
Q

Specific performance

A

in land K: may be available for the buyer but generally NOT for the seller. Often for unique goods. IN MD: frequently for output/requirements Ks. MD Requirements: K must be certain, supported by consideration, free from fraud or misrepresentation, mutually enforceable, not inequitable

30
Q

Subjective Impossibility

A

the performance under the contract becomes impossible because of some failure or fault on the part of the performing party. Under those circumstances, the performance obligation is not excused and will be considered as a breach of the contract.

31
Q

Recission

A

IN MD: can get if P was induced into K by fraud, negligent misrep, duress, undue influence, or there was mutual mistake (also material breach) -> unwind K, P must give back all consideration received

32
Q

Reformation

A

IN MD: if fraud or mutual mistake, can establish terms that should have happened. Requires CCE.

33
Q

3rd Party Beneficiary: Who’s liable to creditor beneficiary?

A

the beneficiary can elect to sue either the promisee on the prior obligation or the promisor on the third-party beneficiary contract. Satisfaction of the claim by one operates as a release of the other’s obligation.

34
Q

3rd Party Beneficiary: Who’s liable to donee beneficiary?

A

Generally, although a third-party beneficiary has rights against the promisor in connection with the promised performance, he has no rights against the promisee in the event that the performance is not forthcoming.

35
Q

Unilateral contract

A

The modern minority rule is that an offer for a unilateral contract cannot be revoked once the offeree has made a substantial start on performance of the requested act in reliance on the offer.

36
Q

Default as to when payment is due in services contract

A

Payment rendered after services completed

37
Q

Default as to how payment is due

A

Cash or check fine but if one offers first, that becomes the norm

38
Q

Liquidated Damages

A

an attempt by parties to an agreement to determine in advance the damages that would compensate the aggrieved party in case of a breach. To be upheld: 1. the damages that are anticipated by a possible breach must be difficult to prove or uncertain, and 2. the amount chosen for the provision must be a reasonable estimate of losses to be expected from a breach.

39
Q

Infancy

A

Minors can make contracts that are valid but voidable. Disaffirmance: words or deeds that objectively signify the election to avoid liability -> must restore any goods or benefits still in her possession, NOT liable for payment for services. If damaged or have depreciated, the restitution obligation extends no further than returning them “as now,” no obligation to make restitution. OJO where the minor has received necessities such as food, shelter, clothing, or medical attention -> will remain liable for the reasonable market value of any necessity that cannot be returned in “as received” condition.

40
Q

Promise to pay a debt

A

Ordinarily unenforceable as lacks consideration. BUT if after statute of limitations has run or has been discharged in bankruptcy, enforceable if in writing (SoF).

41
Q

Requirements contracts

A

No need for minimum purchase b/c has obligation of good faith. Subject to protection from disproportionate demands: unreasonably disproportionate demand/tender w. estimate/prior dealings

42
Q

Termination of offer

A

 lapse time (1) subject matter and mkt conditions (2) urgency communicated OJO! Face to face rule
 death/incapacity either party
 revocation direct: (1) b4 acceptance (2) communicated OR indirect (1) inconsistent action (2) reliable info of it
 rejection  via nonconforming acceptance  via counteroffer

43
Q

Modification

A
  • CL preexisting duty rule, NO mutual modification UNLESS increase compensation if (1) performance dif than previous (2) not mere pretense OR (3) unforeseen circumstances: performance unexp. substantially more burdensome
  • UCC no consideration necessary but good faith test

OJO! Duress is after the fact defense to breach of modification CL and UCC

oral mod fine, BUT UCC can have no oral mod clause → if attempt made anyway can act as waiver, estopped

MD: no oral mod clause must be sep. signed by consumer

44
Q

Substantial performance

A

IN CL CONTRACTS if less than perfect performance, is defect material? If yes, you can suspend your performance. If no, must perform and get compensated later with damages.

45
Q

Accord and Satisfaction

A

IF there is a bona fide or good faith dispute as to the debt, creditor may accept part payment from debtor as full satisfaction

46
Q

Constructive condition

A

A court will determine that the promises are independent of one another only where such an intention is clearly expressed or otherwise consistent with the overall purpose of the contract; otherwise, the promises are considered dependent on one another.

47
Q

Face to face rule

A

an offer made face to face is ordinarily open only until the end of the conversation.

48
Q

Assignments

A

Assign all rights and duties (no longer liable?). Maj: first assignee wins. Min: a second assignee who takes for value in good faith gets it.

49
Q

Advertisements

A

Generally, advertisements are considered invitations for offers, rather than offers themselves. However, where an advertisement invites acceptance by performance without further communication (as in the case of reward offers), it may constitute an actual offer.

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