UCC and Restatement Rules

Question 1

Restatement 71 Consideration

Answer 1

Mutual Reciprocal Inducement

1) Benefit to the Promisor
2) Detriment to the Promisee
3) bargained for exchange

Question 2

Forbearance to assert or the surrender of a claim or defense which proves to be invalid is not consideration unless:

Answer 2

A) (subjective) The claim or defense is in fact doubtful because of uncertainty as to the facts or the law, or

B) (objective) The forbearing or surrendering part believes reasonably that the claim or defense may be fairly determined to be valid

Question 3

Bilateral Contract

Answer 3

K where both parties make promises

Question 4

Unilateral Contract

Answer 4

K in which the promisor has sought performance in exchange for a promise

Question 5

Remedies

Answer 5

1) Expectancy (preferred)
2) Restitution
3) Reliance

Question 6

Restatement 86

Answer 6

Promise made in recognition of a benefit previously received by the promisor from the promisee is binding to the extent necessary to prevent injustice

Question 7

Non compete covenant acceptable when

Answer 7

Reasonable

a) Duration
b) Geographic Scope
c) Range of Activities

and

Consideration

Question 8

Subjective satisfaction clause-

Answer 8

Must be an honest dissatisfaction not necessarily reasonable

Question 9

Objective Satisfaction

Answer 9

You made me these widgets and they dont fit in the hole

Question 10

Promissory Estoppel

Answer 10

1) Promise
2) Reasonable reliance

A promise which the promisor should reasonably expect to induct action or forbearance on the part of the promisee or a third person and which does induce such action or forebearamce is binding if injustice can be avoided only by enforcement of the promise. the remedy granted for breach may be limited as justice requires.

Question 11

Restatement 74

Answer 11

1) Forbearance to assert or the surrender of a claim or defense which proves to be invalid is not consideration unless:
a) (Objective) the claim or defense is in fact doubtful because of uncertainty as to the facts of law
(b) (Subjective) the forbearing or surrendering party reasonably believes that the claim or defense may be fairly determined to be valid.

Question 12

Restatement 87 Option Contract

Answer 12

(1) . Is in writing and signed by the offeror, recites a purported consideration for the making of the offer, and proposes an exchange on fair terms within a reasonable time; or
(2) . Is made irrevocable by statute.

-An offer which the offeror should reasonably expect to induce action or forbearance of a substantial character on the part of the offeree before acceptance and which does induce such action or forbearance is binding as an option contract to the extent necessary to avoid injustice

Option contracts survive death because they are contracts

Question 13

Contract

Answer 13

promise or set of promise for the breach of which the law gives a remedy, or the performance of which the law in some way recognizes a duty

Question 14

Conditional K

Answer 14

promise is conditional if the performance will be become due only if a particular event, known as a “condition” occurs. Does not mean that the promise is not binding until the event occurs, only that the event must occur before performance must be done

Question 15

Offer

Answer 15

statement which (1) reasonably appears (2) to be presently bound (3) to a definite commitment (4) upon Offeree (E)’s acceptance

Question 16

Requirements of Offer

Answer 16

(1) manifestation of present contractual intent; (2) certainty and definiteness of terms; (3) communication to E

Question 17

Mistaken Bid

Answer 17

Not valid if (1) non-mistaken party s/have known OR (2) a) honest or clerical mistake, b) performance results in undue hardship, c) non-mistaken party can be restored to SQA. (R.2d§153

Question 18

Termination of Offer

Answer 18

1) Lapse of Offer
2) Offeror’s revocation
3) Death/incapacity
4) Offeree’s rejection

Question 19

Family K

Answer 19

Often not enforceable, gifts assumed to be motivated by altruism, not bargains for gain

Question 20

Illusory Promise

Answer 20

Performance by O is optional not enforceable

Question 21

Rewards

Answer 21

Promise needs to be completed prior to action for it to be considered as consideration (feinberg case)

Question 22

Requirements or output K

Answer 22

Looks illusory but enforceable as long as promises to buy requirements or to sell output it is made in good faith UCC 2-306

Question 23

Exclusive Dealing K

Answer 23

looks illusory, but is enforceable, promise to use “best efforts” to supply/promote goods must be done in good faith UCC 2-306(2) (Wood v. Lucy, Lady Duff Gordon)

Question 24

Revocation of Offer

Answer 24

Valid prior to acceptance, except for option contract or firm offer

Question 25

Revocation by communication

Answer 25

Offeree’s power of acceptance is term’d upon receipt from Offeror or manifestation of an intent not to enter into the proposed K

Question 26

Revocation of general offers

Answer 26

Offeror can be required to give notice of revocation in exact manner of offer,

but not bound by acceptance of offeree
who was aware of the offer but missed notice of revocation

Question 27

mailbox rule

Answer 27

Default Rule, Acceptance effective upon dispatch. Revocation/rejection effective when received.

Question 28

Firm Offer UCC 2-205

Answer 28

Promise to keep offer open w/o consideration enforceable if (1) made by merchant (2) in writing (3) for the sale of goods and (4) accepted w/in 3 mos