Post-Midterm Black Letter Law

Question 1

Breach

Answer 1

Failure to perform when performance is due

(1) a valid contract was formed
(2) the contract was breached

Question 2

Repudiation

Answer 2

(1) A party’s definite and unequivocal statement that he will commit a material breach of the contract when the time for performance becomes due; OR
(2) a voluntary, affirmative act by the party that renders him unable or apparently unable to perform a material contract duty.

Question 3

Demand for Adequate Assurance

UCC

Answer 3

Article 2 of the UCC allows for demand of adequate assurance when doubt arises out of whether a party will/has repudiated. If party does not provide reasonable assurance, the failure is a repudiation

Question 4

Demand for Adequate Assurance

Common law

Answer 4

Common law provides non-repudiating party may “treat” the failure to give assurance as a repudiation instead of it automatically being one.

Question 5

Parole Evidence Rule

Answer 5

Applies when the parties put their bargain in writing, but the written contract fails to include an agreement or promise made contemporaneous or prior to reducing the bargain to written form.

Question 6

Steps to determine if PER applies

Answer 6

Step one: Is the written contract an integrated agreement?

Step two: Is the integrated agreement a total integration or a partial integration?

Question 7

Total integration

Answer 7

final, includes all the contract’s terms. Supersedes all agreements and promises, even if it is inconsistent.

Question 8

Partial Integration

Answer 8

while final, includes only some of the contract’s terms.

• Supersedes only the terms inside of it
• May be automatically considered partial if: (1) the extrinsic agreement was for separate consideration or (2) it was natural in the circumstances to omit the extrinsic agreement from the written document.

Question 9

Factors in determining partial vs Total integration

Answer 9

1. Writings apparent completeness
2. Inclusion of merge clause
   a. Provides the entire agreement is set forth in the writing (relates to duty to read)
3. Connection between extrinsic terms and the terms of the writing

Question 10

How to interpret a Contract’s Express terms and Provisions (ambiguity)

Answer 10

Step one: If the term is ambiguous
Step two: Whether there was a misunderstanding
Step three: if one party is aware of misunderstanding
Step four: if neither party is aware, objective theory of contracts applies
If one parties meaning is more reasonable than the other, use that one. If both are equally reasonable, no contract due to lack of mutual assent.

Question 11

Plain Meaning Rule

Answer 11

1. Review of document alone

2. May use dictionary definitions

Question 12

Context Rule

Answer 12

Considers any relevant evidence, including extrinsic evidence

Question 13

What is a condition?

Answer 13

Events that must occur before a party’s duty to perform a contract duty becomes due.

Question 14

Express Condition

Answer 14

When parties expressly agree that one party’s duty to perform is conditioned on some event occurring or not occurring.
-Express condition must occur completely, unless impracticable or impossible.

Question 15

Implied in Fact Conditions

Answer 15

Inferred from the contract’s terms or surrounding circumstances.

Question 16

Constructive Conditions (Implied in law)

Answer 16

One that the parties did not manifest assent to, but the court will impose as a matter of justice.

Question 17

Elements of Impracticability and Impossibility (in conditions)

Answer 17

1. The conditions occurrence is impracticable or impossible
2. The occurrence of the condition is not a material part of the agreed exchange and
3. Forfeiture would result if its nonoccurrence were not excused

Question 18

Elements of Disproportionate Forfeiture

Answer 18

1. A failure to excuse the nonoccurrence of the condition would cause disproportionate forfeiture and
2. The condition was not a material part of the agreed exchange

Question 19

Statute of Frauds

Answer 19

a. Marriage (promises in consideration of marriage)
b. Year (contracts that would take longer than one year to perform)
c. Land (contracts for sale of land and long term leases, including land usage, but not licenses)
d. Executor (Promises by an estates executor or administrator to pay off a debt of the decedent)
e. Goods (contracts for sale of goods over a certain price)
f. Suretyship (pay off someone else’s debt)

Question 20

How to determine if a contract is evidenced by a sufficient writing?

Answer 20

i. A writing
ii. Signed by or on behalf of the party to be charged
iii. That reasonably identifies the contracts subject matter, sufficiently indicates that a contract was made between the parties or offered by the signer to the other party, and states with reasonable certainty the essential terms of the contracts unperformed promises

Question 21

Unilateral Mistake

Answer 21

1. The party, at the time of formation, made a mistake of which the other party was unaware
2. The facts existence was a basic assumption on which the mistaken party made the contract
3. Mistake has a materially adverse effect on the mistakes party
4. Mistaken party should not bear the risk of the mistake
5. (a) mistake makes the contracts enforcement unconscionable OR (b) other party had reason to know at the time of contract formation that the party was mistaken or the other party’s fault caused the mistake.

Question 22

Misrepresentation

Answer 22

1. The other/3rd party makes a misrepresentation
2. The misrepresentation is either fraudulent or material
3. The misrepresentation induces the party’s assent to the contract
4. The party is justified in relying on the misrepresentation
5. If the misrepresentation was made by a 3rd party, the other party, at the time of contract formation, knew or had reason to know of the misrepresentation

Question 23

Duress

Answer 23

1. The other party or a 3rd party makes an improper threat to the victim
2. The threat induces the victim to enter the contract
3. The threat leaves the victim with no reasonable alternative other than to enter the contract or to modify it
4. If the threat was made by a 3rd party, the other party, at the time of formation or modification, knew or had reason to know of the threat

Question 24

Undue Influence

Answer 24

1. Victim was justified in assuming that the person exercising the persuasion would not act in a manner inconsistent with the victim’s welfare or the victim was under the domination of the person exercising the persuasion
2. The other party or 3rd party exerted unfair persuasion upon the victim
3. If the unfair persuasion was from a 3rd party, the other party to the contract, knew or had reason to know of the unfair persuasion

Question 25

Changed Circumstances (impossibility/Impracticability)

Answer 25

1. The event makes the party’s performance of the duty impossible or impracticable
2. The occurrence of the event was not due to the party’s fault
3. The occurrence of the event was a basic assumption on which the contract was made (could not have been too foreseeable)
4. The party did not agree to assume the risk of the event’s nonoccurrence

Question 26

Frustration of Purpose

Answer 26

i. The event substantially frustrated what both parties understood at the time of formation was the party’s principal purpose for entering the contract
ii. The event’s occurrence was not due to the party’s fault
iii. The event’s occurrence was a basic assumption on which the contract was made
iv. The party did not agree to assume the risk of the event’s nonoccurrence

Question 27

Effects of changed circumstances on the other party’s contract duties

Answer 27

Party’s duties are discharged if

i. The party’s failure to perform the duties that were discharged is a “material” nonperformance and
ii. The other party did not assume the risk that he or she would still have performed despite the other party’s nonperformance.

Question 28

What is an opinion?

Answer 28

expression of judgment as to quality, value, authenticity, or similar matters, or the expression of a belief, w/o certainty, about the existence of a fact

Question 29

Factors to determine whether a statement was an opinion

Answer 29

1. Whether the seller used hedging language

2. The specificity of the representation

Question 30

What is a concealment?

Answer 30

Party actively hides something or takes action that is likely to prevent a party from conducting an adequate investigation of the undisclosed fact

Question 31

Factors to determine whether a misrepresentation substantially contributed to a party manifesting assent

Answer 31

1. The form of the misrepresentation
2. The buyer’s and seller’s relative knowledge of the matter in question, including whether the buyer could easily investigate the validity of the representation and
3. The seller’s emphasis on the representation

Question 32

Factors to determine whether a disclaimer clause is enforceable

Answer 32

i. Specificity
ii. Conspicuous and read/understood
iii. Recipient sophistication
Ex: Represented by attorney?

Question 33

Factors in determining whether a party is justified in relying on an opinion

Answer 33

i. Relationship of trust and confidence
ii. Misrepresenting party had special skill or judgment with respect to the subject matter OR
iii. The recipient is particularly susceptible due to lack of intelligence, illiteracy, or unusual credulity or gullibility.

Question 34

Factors in determining whether a party was subject to unfair persuasion (for undue influence)

Answer 34

1. Degree and type of persuasion
2. Unavailability of independent advice to the victim
3. Victim’s susceptibility to persuasion, including whether the victim is weak, infirm, or old and
4. The unfairness of the bargain to the victim i.e. Seriously impair the free and competent exercise of the victim’s judgment

Question 35

When is a party able to obtain restitution via quasi or otherwise for a contract that is void against public policy?

Answer 35

1. The party will suffer a forfeiture disproportionate to the public policy involved,
2. The party was excusably ignorant of relevant facts or of legislation of a minor character
3. The other party is more responsible for the transaction or for it being against public policy OR
4. The party did not engage in serious misconduct, and he withdrew before any improper conduct was performed

Question 36

What are the two elements of unconscionability?

Answer 36

1. Procedural (focuses on the events leading to formation)
2. Substantive (focuses on the substance of the contract ex. the one-sidedness of the contract or its terms at the time of formation)

Question 37

Effects of unconscionability

Answer 37

i. Refuse to enforce the contract
ii. Enforce contract without unconscionable term or
iii. Limit the unconscionable term’s application

Question 38

Force Majeure Clause

Answer 38

Express agreement excusing a party’s nonperformance because of a future event

Question 39

What is supervening impracticability?

Answer 39

Applies when an unanticipated event occurs after formation

Question 40

What is existing impracticability?

Answer 40

Applies when there exists a fact at the time of formation that the parties are unaware of that makes performance impossible or difficult

Question 41

Elements of Mutual mistake

Answer 41

1. Both parties, at the time of formation, made a mistake
2. The facts existence was a basic assumption on which the mistaken party made the contract
3. Mistake has a materially adverse effect on the mistakes party
4. Mistaken party should not bear the risk of the mistake

Question 42

Elements of Unilateral Mistake

Answer 42

1. The party, at the time of formation, made a mistake of which the other party was unaware
2. The facts existence was a basic assumption on which the mistaken party made the contract
3. Mistake has a materially adverse effect on the mistakes party
4. Mistaken party should not bear the risk of the mistake

Question 43

Elements of waiver of a condition

Answer 43

Element one: Only a party for whose sole benefit the condition is included has the power to waive the past or future condition.
Element two: Must not be a material party of the agreed exchange