Formation Flashcards
Objective Theory of Formation
would an objective person look at the words and think a contract was formed?
- Lucy v. Zhemer
Indefiniteness
Agreement lacks enough detail to be enforceable
Varney v. Ditmars
(You Boys)
“fair share of the profits” is too indefinite.
Corthell v. Summit Thread
(Inventions Case)
A contract that gives purposely party room for ambiguity is not indefinite
Open Price Term (2-305)
Enforceable contract without definite price. Seller determines later and buyer is bound.
Are adverts an offer?
No.
Lefkowitz
Adverts are not an offer unless it has specific quantity and means of acceptance
Are adverts promising reward for performance an offer?
yes.
Joseph Martin Delicatessen v. Schumacher
(TBD)
renewal clause with price “TBD” was not a contract, just an agreement to agree
Restatement 33
Contract can’t be enforced unless the terms of the contract are reasonably certain.
Contract is binding IF:
- Consideration
- Promise plus reliance
- Promise plus benefit
Hamer v. Sidway
agreement to incur detriment is consideration
St. Peter v. Pioneer Theater Corp
If a promise in a contract depends on the other person doing something they don’t have to do, that action counts as the ‘payment’ for the promise.
Kriksey v. Kirksey
The detriment did not induce the promise. Both must be true.
Conditional Gift v. Promise
Did the promisor receive benefit?
- this is an aid, not a test.
Batsakis
(Currency Case)
Consideration is not about fairness. Only legal sufficiency matters. (25 vs 2k).
Adequacy of Consideration (R 79)
There is no adequacy, only legal sufficiency.
Promissory estoppel
Promisor cannot deny consideration if promise was detrimentally relied on.
Fienberg v. Pfieffer
(Retirement Pension)
There was no consideration, but a gratuitous promise was relied on. So, promissory estoppel.
Hayes v. Plantation Steel
(Announced Retirement)
No consideration or reliance (P already announced retirement).
Lefkowitz
Adverts are not offers unless specifying quantity and means of acceptance.
Dyno Construction
(Fax v. Phone)
Price quotes are not an offer. Signing sale agreement is.
Ever-Tite Roofing
offer was accepted when performance commenced within the meaning of the offer.
- this was a bilateral contract
If it is unclear whether the offer is inviting acceptance by promise or performance:
Either is sufficient.
Mailbox Rule
Acceptance effective when mailed.
Acceptance effective when received under Option Contract
Methods of Termination
- rejection or counteroffer
- lapse of time
- revocation
- death or incapacity
- nonoccurence of a condition
Option Contract
2 considerations
1. To hold offer open
2. Underlying offer
Must be in writing
Revocation
Offeror always has power to revoke
Firm Offer (2-205)
Merchants can make firm offers without consideration
Ciaramella v. Readers Digest
“we have a deal” was not a contract.
- four factor test
- drafted agreement said it must be finalized by attorneys.
§ 27 Contract Where Written Memorial is Contemplated
It is possible to have an agreement even if there is a small agreement to memorialize the contract and it has not been done yet.
Tribune I
There is an existing binding agreement to the ultimate objective
Tribune II
There is not an existing binding agreement, only an agreement to negotiate in good faith.
Reliance on an Offer
Reliance on an offer sometimes creates an option contract in the offeree.
- usually in cases with contractors and subcontractors
- in most circumstances, this is unreasonable and the offer is revocable.
Pavel Enterprises
(subcontractors)
P’s conduct did not show they relied on the offer when they asked subcontractors for new bids
Mere relationship of contractor/subcontractor does not establish reliance.
Dataserv
Counteroffers are rejections of the offer.
Mirror Image Rule
Acceptance must match the offer
- purported acceptance on the basis of changes is a counteroffer
- applies outside UCC
Last Shot Doctrine
If the parties send differing forms and then perform, last shot doctrine applies
- applies outside the sale of goods
2-207
(1BC) contract can exist if forms dont match, or if they’re conduct signifies they have a contract but there was something expressly conditional
(1AC) UNLESS an express condition is made
(2) additional terms are suggestions. Problematically leaves out different terms.
(3) If the partys’ conduct forms contract, the terms are where their writings agree. The others will be supplemented by UCC
2-207 Interpretations
- If “after comma” is triggered and performance commenced, its a counteroffer.
- Rotolith
- This brings us back to last shot doctrine
- rejected by most courts - Look to section 3
- Ionics
