Contracts (Essay) Flashcards
Airline and Oil Company
Issue 1: Does a valid K exist between A and B?
Contract requires offer, acceptance and consideration, which is a legal detriment or benefit and bargain for exchange.
o FL recognizes contract if benefit or detriment to one party
o UCC governs sale of goods, CL governs services
Good is any movable item
o Firm offer by merchant in writing with express terms for time under UCC valid without consideration
Cannot be revoked for 3 months
o Requirements contract where seller agrees to supply all buyer’s requirement
o Acceptance by mail is effective upon dispatch (mailbox rule)
Airline and Oil Company
Issue 2: What claims does A have against B for revoking its offer in a later letter?
Offer can only be revoked before acceptance
o Offer revocation effective when received
o Promissory estoppel permits enforcement of contract when there has been detrimental reliance; requires promise, actual reliance, foreseeable reliance, and injustice.
Airline and Oil Company
Issue 3: Does B have defense of impracticability?
FL will determine contract to be impracticable when circumstances have made performance vitally different from what was anticipated when parties entered onto contract.
o Under UCC, increased cost alone does not excuse performance, unless rise in cost due to undorseeable contingency and alters essential nature of performance.
Airline and Oil Company
Issue 4: Does B have the defense of Statute of Frauds?
SOF applicable to sale of goods over $500
o Requires contract for more than $500 to be in writing, signed by party against whom enforcement sought, based on real transaction, describing quantity to be sold.
o For requirements contract expression “output,” or “requirement,” or their equivalent, satisfies the SOF quantity requirement.
Airline and Oil Company
Issue 5: Does B have a claim against Airline for the earlier shipment at cheaper price?
Acceptance of shipment of goods valid acceptance under UCC.
o Seller can accept buyer’s offer to purchase goods for prompt or current shipment by:
Prompt or current shipment of foods in conformity with terms of offer, or
By shipping non-conforming goods
Shipment constitutes valid acceptance and creates bind contract
o For one year contract, full performance of oral contract for services by party performing services will make contract enforceable against paying party.
o Delivery of goods can constitution partial performance only if seller makes delivery and buyer accepts goods.
Airline and Oil Company
Issue 6: Does A have the defense of unilateral mistake for her cheaper cost in the earlier shipment?
Single party operating under faulty assumption about material facts as they exist at time of contracting is not excused from his contractual performance unless:
o Other party knew or had reason to know of party’s mistake; or
o His mistake based on clerical error.
Buds Specialty Goods
Issue 1: Whether A has a claim against B for breach of K?
Where there is a valid K, any nonperformance by a promising party is a breach.
Buds Specialty Goods
Issue 2: Whether B can assert the SOF as a defense?
The UCC SOF applies to sale of goods of $500 or more, requiring that a writing be signed by the party against whom enforcement of the K is sought.
o Satisfaction of the UCC SOF requires the term indicating the quantity of goods sold in the transaction
A requirement K will satisfy the quantity term
Under CL SOF, a contract that will not be completed within one year of the formation of the contract requires a writing signed by the party against whom enforcement of the K is sought.
Buds Specialty Goods
Issue 3: Whether B can assert lack of performance may be expected because of impracticability?
Under the UCC, increased cost alone does not excuse performance unless the rise in cost is for to an unenforceable contingency and alters the essential nature of performance.
o Rise or collapse in the market will not justify impracticability because those contingencies are exactly the types of business risks that fixed-price contracts are intended to account for.
Buds Specialty Goods
Issue 4: Types of damages available to A?
Upon a seller’s breach of K for sale of goods, a buyer can either recover damages or seek specific performances.
o Liquidated damages provisions are not enforced when there are no damages, even if the contemplated breach occurs.
o Where the parties have a K containing a liquidated damages clause, this clause will not prevent the non-breaching party from requesting specific performance where such a remedy is otherwise appropriate
If parties have stipulated in K that liquidated damages will be the only remedy, a ct may decline to order specific performance even if it is otherwise appropriate
Buds Specialty Goods
Issue 5: Whether prevailing party will be able to recover reasonable attorney’s fees from the non-prevailing party?
A party is not entitle to recover its attorney’s fees under FL law unless there is specific statutory authorization for such an award or the award of attorney’s fee’s is provided for by contract.
17-year-old
Issue 1: Governing Law?
o FL recognizes contract if benefit or detriment to one party
o UCC governs sale of goods, CL governs services
Good is any movable item
Shipment of Non-Conforming Goods: The “Perfect Tender Rule”: the perfect tender rule states that a buyer is permitted to reject goods shipped or delivered to it from a seller if the seller’s tender of the goods is in some way not perfect.
o When seller sends non conforming goods to buyer and indicates they are for accommodation, seller is deemed to make a counter offer rather than acceptance.
17-year-old
Issue 2: Does a valid K exist?
Contract requires offer, acceptance and consideration, which is a legal detriment or benefit and bargain for exchange.
An offer is a manifestation of intent to enter into a bargain. The offer must signal to the other party the willingness to conclude the deal if the other party accepts the offer.
- Acceptance is when the offeree manifests assent to the terms of the offer.
- Under the UCC, the seller can accept a buyer’s offer to purchase goods for prompt or current shipment by shipping nonconforming goods.
- However, the perfect tender rule states that a buyer is permitted to reject goods shipped or delivered to it from a seller if the seller’s tender of the goods is in some way not perfect.
- When seller sends non conforming goods to buyer and indicates they are for accommodation, seller is deemed to make a counter offer rather than acceptance.
…. 17-year-old had the right to reject and he did.
17-year-old
Issue 3: SOF as a defense…
The UCC SOF applies to sale of goods of $500 or more, requiring that a writing be signed by the party against whom enforcement of the K is sought.
o Satisfaction of the UCC SOF requires the term indicating the quantity of goods sold in the transaction
A requirement K will satisfy the quantity term
Under CL SOF, a contract that will not be completed within one year of the formation of the contract requires a writing signed by the party against whom enforcement of the K is sought.
17-year-old
Issue 4: Defense of being a minor…
o Until attaining the common law age of 21 or most states’ age of majority of 18, the minors may for contracts, but their obligation are voidable. Disaffirmance of accomplished by words or deeds that objectively signify the election to avoud liability. Disaffirmance can occur prior to performance or even afterwards. Unitl the disaffirmance, the contract is binding.
