Intro to Contracts: Mutual Assent Flashcards
Policies for enforcing contracts
Policy = “Any societal goal that will be furthered by a particular decision”
Types of Policies: Economic Efficiency Reasonable Expectations Evidentiary Individual Responsibility / Liberty Sanctity of Promise Judicial Administration Paternalism
UCC POLICIES
(a) UCC must be liberally construed and applied to promote its underlying purposes and policies, which are:
to simplify, clarify, and modernize the law governing commercial transactions;
b) to permit the continued expansion of commercial practices through custom, usage, and agreement of the parties; and
c) to make uniform the law among the various jurisdictions.
UCC § 1-103
What is a Contract?
A legally enforceable promise
Agreements for exchange
What are the sources of contract law?
Judicial opinions (Primary)
Statutes—Uniform Commercial Code (UCC) (Primary)
Restatement of Contracts (Secondary)
Article 2: UCC
Article 2 applies to the sale of goods defined as: “all things movable,” including “the unborn young of animals and growing crops and other identified things attached to realty” UCC 2-105(1)
Exclusions from UCC 2-105(1): GOODS
1) Contracts involving interests in real estate
2) Personal services contracts
3) Common law and sometimes Restatement apply
Unless Displaced by UCC Provisions…..
(b) Unless displaced by the particular provisions of [the UCC], the principles of law and equity, including the law merchant and the law relative to capacity to contract, principal and agent, estoppel, fraud, misrepresentation, duress, coercion, mistake, bankruptcy, and other validating or invalidating cause supplement its provisions.
UCC § 1-103
Restatement of Contracts
Completed in 1932
Original purpose: To restate “black-letter” law (classical view)
Restatement (Second) of Contracts Completed 1979
UCC had a strong influence on Second edition
“predominant purpose” test
If a contract is a mixed transaction, involving both personal services and the sale of goods, courts apply the “predominant purpose” test to determine whether the UCC or the common law governs.
Test: Is the predominant purpose of the contract to provide a personal service or the sale of a good?
Offer Defined (Restatement 24)
Offer is a manifestation of willingness to enter into a bargain, so made as to justify another person in understanding that his assent to that bargain is invited and will conclude it.
Mutual Assent
Mutual assent requires:
(1) Party have reasonable notice of terms and
(2) Party objectively manifest assent to terms
reasonable / objective standard
- Objectively manifest agreement to the same subject matter.
Objective—what reasonable person in position of parties would have intended
Only intent necessary for contract formation = objective (Note 3)
