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Contracts > Formation > Flashcards

Formation Flashcards

1
Q

What is the general test for an offer?

A

A manifestation of commitment.

Whether a reasonable person in the position of the offeree would believe that his or her assent creates a k.

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2
Q

Can a comm. from S to B relating to S’s sale of Redacre to B be an offer even though nothing is said about price? Explain.

A

No. A real estate offer must state price and describe land.

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3
Q

What must an offer for real estate do? (2)

A

State price

Describe land

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4
Q

Can a comm. from S to B relating to S’s sale of her car to B be an offer though nothing is said about price? Explain.

A

Yes. The sale of goods doesn’t require price in the offer.

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5
Q

Can a communication from S to B relating to S’s sale of her car to B be an offer if it provides for the sale “for a fair price” What about if instead of the car, it is for a piece of land?

Explain.

A

No and no.

Under both the CL and the UCC, vague or ambiguous MATERIAL terms are not sufficient to make an offer.

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6
Q

What is the rule regarding specificity of requirements/outputs contracts?

What sort of language will suffice?

A

A k for the sale of goods can state the quantity of goods to be delivered under the k in terms of the buyer’s requirements or seller’s output

All, only, exclusively, solely

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7
Q

Under a requirements/output contract for the sale of goods, can a buyer increase the requirements/output?

If yes, any restrictions? If no, why not?

A

Yes.

The increase must be reasonably proportionate (25,000 to 26,000 ok; 10 to 50 not ok)

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8
Q

B offers to buy grits from S for 5 years. There is not a specific quantity term in the offer. Instead, it provides that B shall purchase all grits from S. Offer? Explain.

A

Yes. This is a requirements k, so the offer can state can state the quantity of goods to be delivered under the k in terms of the buyer’s requirements or seller’s output

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9
Q

In which 2 situations can an advertisement be an offer?

A

If it is in the nature of a reward (unilateral k). For example, A promises 100 pound reward to anyone who catches the flu after using its product.

If the ad specifies quantity and expressly indicates who can accept (e.g., $1 coat, first come first serve).

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10
Q

In what situation can a price quote be an offer?

A

If it is sent in response to an inquiry.

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11
Q

Can an offer ever be accepted after it is terminated?

A

no

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12
Q

During the break, I write in your notes that I offer to sell you my 73 Caddy for $400. The writing fails to indicate how long the offer will be kept open. Can you accept in five years? Explain.

A

No.

Lapse of time

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13
Q

Is lapse of time sufficient for termination?

A

Yes

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14
Q

How much time must lapse for an offer to be terminated?

A

Depends on the facts

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15
Q

In which situation can death or incapacity serve to terminate an offer?

A

If the D or I occurs after the offer but BEFORE acceptance.

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16
Q

What are the two ways in which an offer can be terminated by revocation?

A

Later UNAMBIGUOUS statement by offeror to offeree of an unwillingness or inability to contract OR

Later UNAMBIGUOUS conduct by an offeror indicating and unwillingness or inability to k that the OFFEREE IS AWARE OF

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17
Q

I make a deal to sell my car to Sharon Stone. In the shower that night, I exclaim “I’ve changed my mind!” Is the offer revoked? Explain

A

No. She has no idea.

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18
Q

On Jan 15, I offer to sell my Caddy to Sharon Stone. The next day, I sell my Caddy to Bob. Sharon sees Bob driving my Caddy and learns from him that he has bought it. Is the offer revoked? Explain

A

Yes. She is now aware

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19
Q

I offer my Caddy to Sharon Stone on day 1. I offer it to Bob on day 2. I offer it to Bill on day 3. Sharon learns of the other two offers. Revoked? Explain.

A

No. Multiple offers are OK, as they do not represent an unambiguous indication of revocation.

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20
Q

What are four situations in which an offer is irrevocable?

A

Options

UCC Firm Offer Rule

Reliance

Unilateral contract

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21
Q

What two elements are need for an irrevocable option offer to exists?

A

A promise not to revoke AND

The promise is supported by payment or other consideration

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22
Q

What is the UCC Firm Offer Rule?

A

An offer cannot be revoked for UP TO 3 MONTHS if its AN OFFER TO BUY OR SELL GOODS, it is a SIGNED, WRITTEN PROMISE TO KEEP THE OFFER OPEN, and the PARTY IS A MERCHANT.

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23
Q

S, a used car dealer, offers to sell B a 73 Caddy for $400. The offer is oral and includes a promise that it will be kept open for a week. Can S revoke? Explain.

A

Yes.

No UCC Firm Offer Rule because the promise was oral, not written.

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24
Q

S, a used car dealer, offers to sell B a 73 Caddy for $400. The offer is written and signed, and includes a promise that it will be kept open for a 6 months. Can S revoke? Explain. If yes, why? If no, when can he?

A

S can only revoke after 3 months. UCC Firm Offer Rule limits the irrevocable period to 3 months, so the 6 months will be trimmed back.

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25
Q

S, a used car dealer, offers to Sell B a 73 Caddy for $400. The written offer is signed by S. Can S revoke? Explain.

A

Yes. Offer does not state that S won’t revoke.

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26
Q

S offer to sell B her house for $100,000, and the written offer states that it cannot be revoked for the next four months. Can S revoke? Explain.

A

Yes. RE transactions are not covered by Firm Offer Rule. If B had given some sort of consideration, it would be an option, but that didn’t happen here.

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27
Q

What three elements are required to invoke estoppel to make an offer irrevocable?

A

Reliance

Reasonably foreseeable

Detriment

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28
Q

G is a contractor who is bidding on a contract to build a new hotel, using various subcontractors. S, a sub, submits a big to G to do the painting work for $100k. G relies on S’s bid in making its own bid and is awarded the k. Can S revoke? Explain.

A

No.

G relied on S’s bid, it was reasonably foreseeable that G would do so, and G has acted to its detriment if S indeed revokes. THUS, ESTOPPEL.

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29
Q

What action will make a unilateral contract offer irrevocable?

A

The start of performance by offeree.

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30
Q

Will preparation of the part of the offeree render an unilateral contract offeree irrevocable?

A

No.

31
Q

O offers P $1000 to paint his house. O’s offer states that it can be accepted only by performance. P buys paint. O tried to revoke? Is this ok? Explain.

A

Yes. Mere preparation is enough enough to make a unilateral contract irrevocable.

32
Q

What are three ways in which an offer can be rejected by words or conduct of the offeree?

A

Counteroffer

Conditional acceptance

Additional terms

33
Q

S offers to sells Blackacre to B for $10,000. B responds, I will only pay $9,000. Can be later accepts the offer for $10k? Explain

A

No.

This is a counteroffer and the original deal is dead.

34
Q

On Jan 15, S offers BA to B for $10k. B pays $2 for S not to revoke until April 5. On March 3, B makes a CO to S for $9k. Can B still accepts S’s offer? Explain

A

Yes. An option is in effect here, so B’s CO won’t terminate the offer.

35
Q

S offers BA to B for $10k. B says, “will you accept $9k?” Can B later accept S’s offer? Explain.

A

Yes.

This is mere bargaining. It is not a CO, so the offer is alive.

36
Q

At CL, what effect does a conditional acceptance have on the offer?

A

If rejects the offer and becomes a CO.

37
Q

L offers to lease an apartment to T by sending T a signed lease that is silent about arbitration of disputes. T adds a paragraph that states that T accepts “provided that all disputes shall be resolved by arbitration” and signs. Has T accepts L’s offer created an express k? Explain.

A

No. This is a conditional acceptance, so view as a CO>

38
Q

L offers to lease an apartment to T by sending T a signed lease that is silent about arbitration of disputes. T adds a paragraph that states that T accepts “provided that all disputes shall be resolved by arbitration” and signs.

L sends T the keys after receiving the conditional acceptance. Is there a k? Explain.

A

Yes.

K accepted T’s CO.

39
Q

Under the UCC, what must be present for a a conditional acceptance to become a counter offer?

A

Express insistence

40
Q

B sends S a pruchase order to polyester pant suits. The PO makes no mention of about arbitration of disputes. S adds a paragraph that states that S accepts “only if all disputes shall be resolved by arbitration” and signs. No further communications or actions.

Has S accepted B’s offer? Explain

A

No. There is express insistence here (only if)

41
Q

B sends S a pruchase order to polyester pant suits. The PO makes no mention of about arbitration of disputes. S adds a paragraph that states that S accepts “only if all disputes shall be resolved by arbitration” and signs. No further communications or actions.

If S sends B the pant suits and B pays for them, is there a k?

A

Yes.

42
Q

What rule governs additional terms added to an offer at CL?

A

Mirror Image Rule

43
Q

What does the Mirror Image Rule state?

A

A response to an offer that adds new terms is treated like a CO rather than an acceptance.

44
Q

L offers to lease a building to T by sending T a signed lease that is silent about arbitration disputes. T adds a sentence that states, “All disputes shall be resolved by arbitration proceedings,” and signs. Has T accepted L’s offer? Explain.

A

No. T added a term, thus violating the Mirror Imagine Rule.

45
Q

L offers to lease a building to T by sending T a signed lease that is silent about arbitration disputes. T adds a sentence that states, “All disputes shall be resolved by arbitration proceedings,” and signs. Can T later accept the original offer?

A

No. Original offer is dead under the Mirror Image Rule

46
Q

How does the UCC treat additional or different terms that are not a condition of acceptance?

A

Not a rejection

47
Q

What does the UCC call additional or different terms that are not a condition of acceptance?

A

A SEASONABLE EXPRESSION OF ACCEPTANCE

48
Q

B sends S a signed purchase order for grits that is silent about arbitration disputes. T adds a sentence that states, “All disputes shall be resolved by arbitration proceedings,” and signs. Is there a k? Explain

A

Yes. There is no express insistence that the new terms are a condition of acceptance, so this is considered a “seasonable expression of acceptance” under the UCC.

49
Q

When and only when is an additional term for an offer for goods part of the contract? (2 reqs)

A

The term is immaterial AND both parties are merchants.

50
Q

Epstein offers to sell his 73 Caddy to Conviser for $400. Conviser says “I accept. Deliver it on Saturday.” No further comm. Is there a k?

A

Yes. Seasonable expression of acceptance.

51
Q

Epstein offers to sell his 73 Caddy to Conviser for $400. Conviser says “I accept. Deliver it on Saturday.” No further comm. Assuming there is a k, is the Saturday delivery a term?

A

No. Parties aren’t merchant.

52
Q

Epstein offers to sell his 73 Caddy to Conviser for $400. Conviser says “I accept. Deliver it on Saturday.” No further comm. Assuming there is a k and both parties are merchants, is the Saturday delivery a term?

A

Yes, as long as it is not material.

53
Q

Epstein offers to sell his 73 Caddy to Conviser for $400. Conviser says “I accept on the condition that you deliver it on Saturday.” No further comm. Is there a k?

A

No. Must be agreed upon.

54
Q

Is the start of performance generally considered acceptance?

A

Yes

55
Q

O offers P $1k to paint his house. P starts painting. Has P accepted? Explain.

A

Yes. P has started performance.

56
Q

O offers P $1k to paint his house. P starts painting. Then stops. Breach? Explain.

A

Yes, this is a bilateral k, so this is breach.

57
Q

O offers P $1k to paint his house and states that acceptance is effectuated only by completing the task. P starts painting. Then stops. Breach? Explain.

A

No. This is a unilateral k and P can stop.

58
Q

Communications other than ____ are effective ____ when _____

A

Acceptance

Only when received.

59
Q

Generally, acceptance is effective when . . . ?

A

Mailed (mailbox rule)

60
Q

If a rejection is mailed before an acceptance, neither is effective until received. True or False?

A

True.

61
Q

True or false: you can use the mailbox rule to meet an option deadline.

A

False.

62
Q

Conviser receives a letter from Epstein offering to sell C his 73 Caddy for $400. On Jan 10, Conviser mails his letter of acceptance. On Jan 11, Conviser receives a letter from Epstein revoking the offer. Is there a k? Explain.

A

Yes.

Acceptance is effective when mailed. Revocation is not operable until it is received.

63
Q

Conniver receives a letter from Phish inviting him to replace Trey in a new version of the group. On August 8, Conviser mails a letter to the group rejecting their offer. On August 9, he changes his mind and mails a letter of acceptance. What result if the rejection letter arrives first? Explain

A

No k.

If rejection is mailed before acceptance, and rejection is received first, then no k.

64
Q

Band S execute an option that gives B the option to buy BA from S for $100k. The option contract provides that it expires on 7/13 at 5pm EST. B mails S a letter on 7/13 at 4:50pm, exercising the option to buy. Did B meet the option deadline? Explain.

A

No. You cannot use the mailbox rule to meet an option deadline.

65
Q

What is the general rule when a seller of goods send the wrong goods?

A

Acceptance of k and breach of k.

66
Q

Ordinarily, when when a seller of goods send the wrong goods, it is considered an option an a breach. What is the seller provides an explanation beforehand?

A

Counteroffer and no breach.

67
Q

B orders 100 red widgets. S sends 100 blue widgets with the explanation that he is out of red, and that hopefully blue will do the job. Is there a k? Explain.

A

No. Since S offered an explanation, no k.

68
Q

B orders 100 red widgets. S sends 100 blue widgets with the explanation that he is out of red, and that hopefully blue will do the job. Is there a breach? Explain.

A

No. Since S offered an explanation, no k. Since no k, no breach.

69
Q

What two things ordinarily must be true for someone to be eligible to accept an offer?

A

They must know of the offer AND

They must be the person to whom the offer was made.

70
Q

Can an offer be assigned to someone else?

A

No

71
Q

Can an option be assigned to someone else?

A

Yes.

72
Q

I offer a $500 reward for finding my dog. A finds my dog, returns him, but doesn’t know about the reward. I say nothing. A comes back the next day and demands the money after she finds out. Is that acceptance of the offer? Explain.

A

No. She did not know of the award (offer) when she accepted.

73
Q

You pay me $10 for a 10-day option to buy my Caddy for $400. Can you sell the option to Conviser so that he can now exercise that option and buy?

A

Yes, as long as the option does not include “no transfer” language.

74
Q

Name some legal reasons why a k might not be enforced despite offer and acceptance. (11)

A

Lack of consideration

Lack of capacity

Statute of Frauds

Existing laws that prohibit performance

Public policy

Misrepresentations

Nondisclosure

Duress

Unconscionability

Ambiguity in words of k

Material mistakes

Contracts (11 decks)

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