discerning the agreement Flashcards
Raffles (ambiguous) – the ex peerless ship case! The parties were in disagreement about which peerles ship was meant when the k said the cotton would be arriving ex peerless, issue of whether there was a meeting of the minds when pirates have different meanings regarding terms
there is no contract if there is a mutual misunderstanding by both pirates as to the meaning of a term of an agreement
would we have found for the raffles case the same way today
no, on its face the k put little emphasis on the name of the ship, and objectivly both parites were mutually assenting so there should have been a k
Oswald (ambiguous) – the coin case; P, who didn’t speak english wanted to buy swiss coin collection from D, he went to see them and didn’t realize that all the coins were from two separate collections, he understood them to all be apart of the swiss coin collection, she did not, but they did not realize this miscommunication till later; issue of whether there was an agreement
when any of the terms used to express an agreement is ambiguous and the parties understand it in diff ways, there is no K UNLESS one of the paries should have been aware of the other’s understanding
Frigaliment (vague)– the chicken case! There was an agreement between the parties to buy and sell ‘chickens’ issue of what the word chicken meant/ and whether courts can look externally to discern the meaning of a vague term.
when parties to a K, in good faith, subjectively construed a term differently, courts are allowed to look externally to determine the proper meaning of the term
what external factors did the frigalment court look at to discern the menaing of chicken
hey looked at the og k, and also considered the fact that because D was new to the trade, D’s acceptance of the standard must be made to appear by proving he had knowledge of the meaning the P put to the word or that there was a general understanding of P’s use
When all the evidence was taken into consideration, it was clear that D believed it would comply with the K by delivering stewing chicken
Weinberg (vague) – the dress case, p and d had retail stores, the leasing agreement said that no one else but P would sell ladies dresses, D began selling skirt - blouse sets, P sued for breach of K, issue of what the word dresses entailed
an example of the court stepping in when two people in the same industry have conflcing subjective defs of a term
a K will not be enforced when the terms of the k are too vague for the court to try and interpret.
rst 201 - whose meaning prevails when
the parties have the same meaning to a term
if the parties have diff meanings but one party had reason to know of the other parties meaning
the parties have different meanings and have no reason to know the other’s attached meaning
If parties have the same meaning to a term = that meaning will prevail
If the parties have diff meanings, it is attached by one of them at the time the agreement was made
When one party didnt know of any diff meaning but the other party knew the meaning attached by the first; the first pirates meaning will prevail
When one party had no reason to know of any other meaning attached by the other and the other did have a reason to know
Neither party is bound by the meaning attached by the other (except inthe above exceptions) even if that means a failure of mutual assent
2-208 course of performance or practical construction
Comment - the parties themselves know best what they have meant by their words of agreement and their actions under that agreement is the best indication of what the meaning was.
what are the two ways a court will supply terms to fill a gap
Implied in fact- those that the parties actually (although implicitly) agreed to
Implied in law - thought to be imposed upon parties without their consent
what are the types of judical gap fillers
Default rules - refers to those legal rules that the parties can avoid or vary by menas of an express clause that differs from the term a court will otherwise apply by default
Immutable rules - may not be varied by consent of the parties and will override any express clause to the contrary
Sun printing- the parties agreed to buy and seel 1000 tons of paer of months for an allotted time, and that the price of paper should be agreed upon 15 days before the expiration of each period, and the price was not to exceed what the canadian paper company charged; time came for them to agree on a ndw price, D gave notice that the K was imperfect and that they wont deliver, issue over whether the terms were definite and the court could fill in tiny gaps or if it was just an agreement to agree
a court cant fill in gaps in a contract if the terms are not definite enough to assume to know what the parties meant ; to constitute a binding K, the terms of each element of the K must be sufficiently specific
Wood v lucy (illusory promise) – D employed P to help her turn her designs into money, gave P the EXCLUSIVE RIGHT subject to D’s approval to place P’s endorsements on the designs of others, this was to last a year, P alleged D broke the K by putting endorsements on clothes without his knowledge; issue of whether the court will fill the gap an show that there was an implication that a promise was made
a promise can be implied if the facts provide evidence of a mutual obligation and courts will fill that gap; a promise to use reasonable efforts may be implied from the entire circumstances of a contract
New York Central Iron works (illusory promise) – d was bound via k to furnish P with the entire radiator needs for the year on the terms and the prices specified, usually the P only needed 48k feet of radiation but this time P needed more and it totaled 100k, D refused to fill the order, issue over whether the court could fill the gap and imply that the P should not exceed what they normally needed per year
definite terms will not be implied when a K does not expressly contain them, but each party is required to act in good faith and reasonably
Ie the indefinite term was the amount of iron ot be filled (the d should have been specific if it didn’t want to exceed)
Eastern Airlines – the parties had mutually enjoyed the business relationship up until this point; in the STANDARD FORM aviation K, it said that the parties agreed to buy and deliver jet fuel; but communications between the parties resulted in a demand by D that P meet its demand for a price increase or D would shut off P’s supply; issue over whether the standard form aviation K was a binding requirement K despite its lack of definiteness?
based on the standards set out by the UCC, the k is binding, since the purchasers in this K was an OPERATING BUSINESS, the lack of mutuality and its lack of definition is resolved by an objective standard of good faith
Requirement Ks must be carried out in good faith for them to be binding
what is an illusory promise
A promise is illusory if the person who makes the promise retains complete and unfettered discretion over whether to perform
Ie ‘if I want to’
The principle question is whether the meaningful promise made by one of the parties is enforceable
