contracts fall 1998
Helen Scott
Contract
A. Two Types 4
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Unilateral. Promise for performance. 4
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Classical doctrine. A and C in performance; requirement of notice; effective upon deposit 4
Bishop v. Eaton. 4 -
UCC 2-206(2). notification of acceptance (performance) within reasonable time 4
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Bilateral. Promise for Promise. 4
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Elements
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Offer 4
R2d § 24. assent will conclude bargain
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Preliminary Negotiations. R2d § 26. not O when further manifestation of assent. Lonergan v. Scolnick. 4
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Master of the Offer. R2d § 60. Offeror sets terms re A. 4
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Certainty R2d § 33. terms reasonably certain. basis for determining breach and remedy. 4
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Revocation.
(1) Classical doctrine 5
Revocation effective upon receipt from reliable source. Henthorn v. Fraser. 5
Offer fully revocable until accepted. Petterson v. Pattberg. 5
R2d § 43. Indirect Communication of Offeror’s revocation. Normile v. Miller. 5
R2d § 36. Power of Acceptance terminated by non-occurrence of condition. 5
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Limitations on Revocability. 5
R2d § 45. Part Perf. of Uni K is C for option K. depends on what Offeror wants for Perf. 5
R2d § 87. Option K if separate C. 5
87(2). embodies Drennan. PE which O’r expects before A as C for Option K. 5
UCC §2-205. Firm Offer. merchant. goods. signed writing. no more than 3 mos.
if on form must be separately signed. 6
Mid-South Packers, Inc. v. Shoney’s. series of separate Ks. original O irrev. only 3 mos. 6
UCC §2-103. goods movable at time of K. 6
UCC §2-105. merchant deals in goods or by occupation holds self out as knowledge/skill. 6
N.Y.Gen.Oblig.Law §5-1109. not goods. expressly irrevocable but no C. reasonable time. 6
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Acceptance 7
R2d §50. manifestation of assent to O by performance or promise.
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Manifestation of Assent 7
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Signature and Unilateral Mistake. Absent fraud, duress or mutual mistake . . .
Ray v. Eurice Bros. extensive negotiations. repeat players. St. Landry Loan v. Avie. illiterate.
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R2d § 69. Silence or Exercise of Dominion 7
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R2d § 27. Assent effective though written memorial intended. factors to determine if K concluded. 7
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UCC §2-204. conduct by both parties shows K, though moment of A undetermined. 8
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UCC §2-206. any reasonable mode of A. notification of performance in Uni K. 8
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Mailbox rule 8
R2d §63. A effective upon deposit except Option K upon receipt. Henthorn v. Fraser. 8
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Battle of the Forms - Conflicting Terms in A 8
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Common law doctrine
Mirror image rule 8
R2d § 58. promise or performance must comply with O. 8
R2d § 59. A conditional on assent to add’l or diff. terms is not A but C-O. 9
R2d § 39. C-O is substituted bargain; terminates power of A. Normile v. Miller. 9
Last shot rule. Series of C-Os with substantial conditions in boilerplate. Poel v. Brunswick. 9
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UCC §2-207(1). First Shot Rule. A even if add’l or diff. terms unless expressly made cond’l
on assent, then C-O. 9
UCC §2-207(2) btwn. merchants terms go into K unless O express limited, materially alter, object. 9
UCC §2-207(3) Knockout Rule. when Performance, K only agreed terms and gap-fillers. 9
Brown Machine v. Hercules. indemnification clause material, no express assent so no K. 10
Dale Horning v. Falconer Glass. limitation of remedy clause was hardship, no surprise. 10
UCC §1-205 course of dealing and usage of trade used to evaluate surprise.
UCC §2-715 Buyer’s Incidental and Consequential Damages from Seller’s breach 10
UCC §2-719 Contractual Modification or Limitation of Remedy. 11
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Consideration 11
Gratuitous Promise or gift which requires no consideration is not enforceable.
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Benefit-Detriment test. disjunctive. Hamer v. Sidway. (not required under R2d § 79) 11
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Bargained-for Exchange. R2d §71. Baehr v. Penn-o-Tex. 11
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Adequacy of Consideration. R2d §79. Batsakis v. Demotsis. 11
R2d §77 Illusory Promise. not C if alternatives reserved. Mid-South Packers, Inc. v. Shoney’s. 11
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Past services do not constitute consideration. Plowman v. Indian Refining. 12
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Condition to a gift does not constitute consideration. Plowman v. Indian Refining.. 12
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Motive or Moral obligation is not legally enforceable consideration. Plowman v. Indian Refining. 12
However, parties’ secret ulterior motives do not nullify C. R2d § 81 12
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