Defenses Flashcards
Describe the aggregation of documents rule pertaining to the Statute of Frauds.
Several writings may be aggregated to meet the requirement of the SOF provided their interrelationship is reasonably apparent from the face of the documents.
Define the novation doctrine.
Where a third party offers to perform the promise of another (the obligor) pursuant to an existing agreement, and the other party (the obligee) to the contract agrees to (i) release the obligor, and (ii) substitute the new party in lieu of the obligor, a novation has occurred. As a consequence, the obligor is relieved of her obligation under the original agreement.
What is accord and satisfaction.
An accord is an agreement whereby one party agrees to accept performance that is different from presently owed to her. The satisfaction occurs when the accord is performed (thereby discharging both parties from their contractual obligations). If the accord is not satisfied, the obligee can sue under the old contract or for breach of the accord.
Describe the forebearance to sue rule.
Forebearance to sue is good and valuable consideration even where no valid claim exists, if the promisor reasonably believes that he has a valid claim.
Describe an illusory agreement.
An illusory agreement is one in which a party (1) has assumed no obligation to the other, or (2) can unilaterally avoid the obligations to the other.
What are the circumstances where a liquidated damages provision clause is enforceable?
Liquidated damages clauses are enforceable where (1) damages would otherwise be extremely difficult to determine, (2) the parties made a bona fide effort to estimate the damages that would result if breach occurred, (3) in some states, the damages stipulated are reasonable in light of the actual losses sustained by the plaintiff. The goal of liquidated damages clause must be to fairly compensate the aggrieved party, not punish the breaching party.
Describe the frustration of purpose doctrine.
Where (1) one party has a special purpose for entering into a contract (of which the other side is aware), and (2) that purpose is frustrated by a subsequent, unforeseeable event (the risk of which was not assumed by the party asserting the doctrine), she is relieved of her perspective performance until the frustrating event has ceased to exist.
When are reliance damages available?
Where an aggrieved party’s damages are not capable of estimation and specific performance is inapplicable, she may recover any expenditures made in reliance of the contract.
