Sources of Contract Law

Question 1

When does the UCC govern?

Answer 1

• UCC governs “sales of goods.”
• If UCC applies, it trumps any contrary common law rule.
  o Even if UCC, common law still applies unless UCC contradicts it.

Question 2

What constitutes a sale?

Answer 2

• any transaction in which the seller transfers title of goods to buyer

Question 3

What constitutes a good?

Answer 3

• Any movable item.

Question 4

What does not constitute a good?

Answer 4

• Does not include intangibles (goodwill, IP), money, legal claims, services, or real property.

Question 5

What are the general categories of contractual obligations?

Answer 5

• Express contracts
• Contracts implied in fact
• Contracts implied in law

Question 6

What is an express contract?

Answer 6

• Express = oral and written expressions of the agreement.

Question 7

What is a contract implied in fact?

Answer 7

• Implied-in-fact = formed by conduct rather than words.
  o EXAMPLE: Homeowner hires a plumber to fix a leak, but because of the urgency of the service, the parties do not discuss the price of the work performed. Upon completion of the work, Homeowner has an implied-in-fact obligation to pay the plumber the reasonable value of the services rendered.

Question 8

What is a contract implied in law?

Answer 8

• Implied-in-law = arises where one party bestows benefit on another and it would be unjust not to pay the reasonable value of the benefit.
  o EXAMPLE: A surgeon who performs emergency surgery on an unconscious patient creates an implied-in-law obligation to the patient.
  o EXAMPLE: A merchant who mistakenly delivers goods to the wrong party may create an implied-in-law obligation on the wrong party.