Types of Contracts

Question 1

Contracts governed by UCC Article 2

Answer 1

Sale of goods contracts
-Goods are tangible personal property that are identified to be sold under the contract

Question 2

Contracts governed by common law

Answer 2

Sale of real estate, service, or construction contracts

Question 3

Express contract

Answer 3

Formed by language, oral or written

Question 4

Implied contract

Answer 4

Formed by conduct
-i.e., X fills her car at Y gas station. There is a contract for the purchase and sale of the gas

Question 5

Quasi-contract

Answer 5

When an unenforceable contract results in unjust enrichment
-Not a contract
-Courts permit an action for restitution to recover the amount of the benefit conferred on the defendant

Question 6

Bilateral contract

Answer 6

A promise for a promise
-Can be accepted in any reasonable way (i.e., promising or beginning performance)
-Presume bilateral contract on BAR exam unless stated otherwise

Question 7

Unilateral contract

Answer 7

Acceptance by performance
-Offeror promises to pay upon full performance (then kx is formed)
-Magic words: “offer . . . only by” or reward offer to the public

Question 8

Void contract

Answer 8

Totally without any legal effect from the beginning
-Cannot be enforced by either party

Question 9

Voidable contract

Answer 9

One or both parties may elect to avoid
-Raising a defense that makes a contract voidable (i.e., infancy)

Question 10

Unenforceable contract

Answer 10

Otherwise valid contract that cannot be enforced because of a defense such as the Statute of Frauds

Question 11

UCC Article 2 Merchant

Answer 11

One who regularly deals in goods of the kind sold or who otherwise by their profession holds themselves out as having special knowledge or skills as to the practices or goods involved
-Broader application to S/F, confirmatory memos, firm offers, modifications
>Basically anyone in business
-Narrower application to some Article 2 provisions (implied warranty of merchantability)
>Must be a merchant with respect to goods of the kind involved in the subject transaction
>”Special merchant rules”

Question 12

Contracts involving goods and nongoods

Answer 12

1. If sale involves both goods and services, apply the law of the dominant aspect
2. If contract divides payments between goods ands services, apply UCC to sales portion and common law to goods portion

Question 13

Good faith obligation

Answer 13

Honest in fact and the observance of reasonable commercial standards