Contracts - Applicable Law

Question 1

What are the seven general issues of contract law to address on the exam?

Answer 1

(1) Applicable Law
(2) Formation of Contracts
(3) Terms of Contract
(4) Performance
(5) Remedies for unexcused nonperformance
(6) Excuse of nonperformance
(7) Third-Party Problems

Question 2

When does a unilateral contract (offer) occur?

Answer 2

results from an offer that expressly requires performance as the only possible method of acceptance.

Question 3

When does a bilateral contract occur?

Answer 3

Bilateral contracts are all offers other than a unilateral offer. Bilateral contracts are usually result from offers that are silent as to the method of acceptance.

Bilateral contract unless (i) reward, prize, contract, (ii) offer expressly requires performance for acceptance.

Question 4

When does the common law clearly apply?

Answer 4

(1) Real Estate

(2) Service Contracts

Question 5

When does UCC Apply?

Answer 5

Under Article 1, common law contracts applies to sales of goods “unless displayed by particular provisions of Article 2.”

Article 2 applies to contracts that arepimarily for SALES OF GOOD. Facts to determine if Article 2 applies:

(i) Type of transaction - sale and
(ii) Subject matter of transaction –> Goods (i.e. tangible, personal property)

Article 2 applies regardless of contract amount.

Question 6

What is the general rule when there is a mix of goods and services?

Answer 6

Look to which part of the deal was more important (apply either common law or UCC - all or nothing).

Exception: If contract divides payment, then apply UCC to sale of goods part and common law to the rest. (i.e. $10 for yo-o, $39,990 for lesson)

Question 7

What does Article 2A of the UCC apply?

Answer 7

Applies to leases good goods. (Not leases of land or buildings). [Not on MBE, but it is on MA).