Rule Statements Flashcards
Under subject matter, what is governing authority?
Common law governs all contract unless displaced by the UCC in the sale of goods. The UCC must be liberally construed and applied to promote the underlying principles of judicial uniformity and economy
Under subject matter, what is goods/service/sale?
A good is any thing movable at the identification of a sale, especially manufactured goods. Goods include growing crops, the unborn young of animals, and any other identified thing attached to realty. Service is the act of doing work for another. A sale is the transfer of title from seller to buyer for a price, which typically occurs at delivery if not otherwise specified
What is a hybrid contract?
If a contract includes a good and service, the courts will determine which aspect is dominant and apply the respective law
What is the predominant purpose test (PPT)?
The Predominant Purpose Test, the majority, looks at the contract language, billing, mobility, of the subject matter, reasonably stated purpose, and most importantly the general thrust
What is a merchant?
A merchant is one who deals in the goods of a kind; or by occupation holds himself out as having knowledge or skill in the goods of the kind, or via the attribution clause when an agent with requisite status represents a party
What is a contract?
A contract is a promise or a set of promises for the breach of which the law provides a remedy and for the performance of which the law recognizes a duty
What is a promise?
A promise is a manifestation of intention to act or refrain from acting in a specified way, so made as to justify a promisee in understanding that a commitment has been made
What are the essential ingredients to form a contract?
The formation of a contract requires a bargain with a manifestation of mutual assent to the exchange and consideration. A contract for the sale of goods may be made in any manner sufficient to show agreement, including both parties conduct.
What is manifestation of mutual assent?
Mutual assent is the agreement upon the same bargain at the time, and is reflected in the offer and acceptance, writing, or conduct. Manifestation of assent to an exchange requires that each party either make a promise or begin or render a performance. The manifestation of assent may be made wholly or partly, written, or spoken, or by other acts or failure to act. The conduct of a party may manifest assent even though he does not in fact assent. The UCC recognizes any manner sufficient to show agreement, including conduct by both parties that shows the existence of a contract.
What is an offer (R § 24)?
An offer is a manifestation of willingness to enter into a bargain, made to justify another in understanding that their assent is invited and will conclude it. Per Lefkowitz, a valid offer must be reasonably certain, demonstrating objective intent, and communicated to create a power of acceptance. At common law, the offer is certain when it contains the Quantity, Time, Involved Parties, Price, and Subject Matter (QTIPS). The UCC only requires Quantity, Parties, and Subject matter (QPS); missing terms will be gap filled. Unless unambiguously indicated by language or circumstances, an offer to contract invites acceptance in any for reasonable under the circumstances
What are non-offers?
Generally, price quotes, advertisements, preliminary negotiations, and offers made in jest are not sufficient offers because they lack certainty and do not create a power of acceptance in the offeree. An offer is not valid if the person whom it is addressed knows or has reason to know that the person making it does not intend to conclude a bargain until he has made a further manifestation of assent
What is a termination of an offer?
A contract cannot be created by acceptance after the power of acceptance has been terminated by rejection, counteroffer, lapsed time, revocation, death, or incapacity.
What is an irrevocable offer?
Offers can be revoked before acceptance; however, some offers, such as option contracts or merchant firm offers, cannot be revoked within
What is a merchant firm offer?
A merchant firm offer is a merchant’s signed, written offer, that by its terms assures that the offer will remain open. A firm offer is irrevocable for up to three months if no reasonable time has been provided; despite lack of consideration. UCC 2-205
What is an option contract?
Option contract must be agreed on and supported by consideration. If there is consideration, the option contract is open and irrevocable. Under common law, it can be indefinite, and under the UCC, it is for three months. Unilateral contract becomes an option contract if partially performed. A bilateral contract is a promise for a promise
