Untitled Deck Flashcards
What law governs contracts for the sale of goods versus services?
UCC governs contracts involving the sale of goods.
Common law governs contracts involving services.
Mixed contracts: Whichever predominates determines the governing law.
What should you analyze if a contract includes both goods and services?
Look for facts indicating both apply, explain why UCC and common law might govern, and determine whether goods or services predominate.
Who qualifies as a merchant under the UCC?
- Someone who regularly deals in the goods involved in the transaction.
- Someone holding themselves out as having special knowledge or skill related to the goods.
- A businessperson if the transaction is of a commercial nature.
Do UCC rules always require both parties to be merchants?
No. Some rules, like the firm offer rule or warranty of merchantability, apply even if only one party is a merchant.
What are the three requirements for a valid contract?
Offer. Acceptance. Consideration.
What are the three elements of a valid offer?
Promise: Present intent to contract.
Terms:
- Common law: All essential terms (parties, subject matter, price, quantity).
- UCC: Parties, subject matter, quantity (other terms gap-filled).
Communication: Offer must be communicated to the offeree.
How do unilateral and bilateral contracts differ?
Unilateral: Accepted by complete performance (e.g., rewards, contests). Bilateral: Accepted by a promise or starting performance.
What makes an offer irrevocable under the UCC?
Offeror is a merchant. Offer is in a signed writing with assurances it will remain open. Irrevocability lasts up to 90 days.
What are the ways an offer can terminate?
Revocation (effective upon receipt).
Constructive revocation (offeree learns of inconsistent action).
Rejection by offeree.
Counteroffer by offeree.
Lapse of time.
Death of offeror.
What is required for valid acceptance?
Objective manifestation of intent to accept. Manner of acceptance (reasonable unless specified).
UCC allows acceptance with changes (both merchants: changes may apply unless they materially alter the offer).
When is acceptance effective under the mailbox rule? Are there any exceptions?
Effective: When mailed.
Exceptions: Option contracts or firm offers (acceptance effective on receipt).
What is required for valid consideration?
A bargained-for change in legal position. Both sides must suffer legal detriment (e.g., promising to act or refrain from action). Courts do not evaluate adequacy of consideration.
What are the remedies for mutual mistake?
Reformation: Rewrite the contract if prior agreement existed.
Rescission: Voidable if mistake impacts basic assumptions and adversely affected party did not assume the risk.
When is promissory estoppel used? What is the remedy?
Promise induces action or forbearance. Promisor reasonably expects this. Injustice can only be avoided by enforcement.
Remedy: Reliance damages.
What contracts are governed by the SOF?
Marriage.
Suretyship.
Contracts >1 year.
Sale of goods ≥ $500.
Real property.
