K rules Flashcards
Rule on reward offer
An offer of reward is an offer to enter into a unilateral contract, and if made to the public generally, it may be accepted by anyone to whom it becomes known.
One who performs the requested act has done all that is necessary for acceptance, but if he does not intend that his acts constitute an acceptance, no K results.
mirror image rule (CL)
Acceptance must contain the same terms as the offer. Any variance constitutes a rejection and a counteroffer.
mailbox rule
Only applies to acceptance, effective upon dispatch (placed in a mailbox) and not receipt.
option K
An option K is a promise to keep an offer open for a period of time.
(CL) For an offer to remain open, it must be supported by consideration.
(UCC) An offer by a merchant in a signed writing which by its terms gives assurance that it will be held open is irrevocable during the time stated. If no time is stated, the period of irrevocability may not exceed 90 days. (merchant’s firm offer rule)
requirements K
A buyer promises to buy from a certain seller all of the goods it requires, and the seller agrees to sell that amount to a buyer.
Quantities subject to requirements Ks may not be unreasonably disproportionate to any stated estimate or, in the absence of any stated estimate, to any normal or otherwise comparable prior requirements. Orders must be proportionate to what was ordered in the past.
Quantities will be measured by the buyer’s good faith needs.
Does the mailbox rule apply to option Ks?
No. Acceptance of an option is effective only when received by the offeror, so the mailbox rule does not apply to make acceptance effective on dispatch.
Is past consideration or moral obligation valid consideration or valid substitute consideration for promissory estoppel?
Past consideration or moral obligation are not valid consideration nor valid substitute consideration for promissory estoppel.
Battle of the forms
(UCC) An acceptance containing additional or different terms is effective as between merchants unless the offeree expressly makes his acceptance conditional on assent by the offeror to the additional terms.
(Conditional acceptance is essentially a rejection and a counteroffer.)
unilateral mistake
Unilateral mistake generally will not prevent K formation.. However, in all unilateral mistakes, if the non-mistaken party knows or has reason to know of the other party’s mistake, the non-mistaken party will not be allowed to take advantage of that mistake and the mistaken party will be allowed to rescind the K.
modification
(CL) Requires new consideration
(UCC) Allows for good faith modification
Confirmatory Memo rule
10 day exception to SoF
In Ks between merchants, if one party within a reasonable time after an oral agreement has been made sends to the other party a written confirmation of the understanding sufficient to satisfy the SoF to bind the sender, it will also bind the recipient if:
- he has reason to know of the confirmation’s contents AND
- he does not object to it in writing w/in 10 days of receipt.
Perfect tender rule
(UCC) Seller must deliver perfect tender to a buyer.
cover (UCC)
(UCC) When a seller fails to deliver goods as promised, the buyer may cover by making a reasonable purchase of substitute goods and then may recover as damages the difference between the K price and the cover price.
Vesting of rights of 3rd party beneficiaries
Rights of the third-party beneficiary do not vest until:
- it manifests in a manner invited or requested by the parties, OR
- it learns of the K and detrimentally relies on it, OR
- it brings a lawsuit to enforce its rights.
parol evidence rule
The parol evidence rule bars the introduction of prior or contemporaneous oral agreements that vary or modify the terms of a complete and totally integrated agreement.
