CONTRACTS ISSUE SPOTTING

Offer/Acceptance

Consideration

Restatement 24 Definition of Offer

- Is it bargained for? Restatement 71

Things not an offer:

- does it induce anything?

- price quote, solicitation, advertisement, prelim proposal

Mixed Motives: Restatement 81(1) Doesnt matter why

If yes:

Nominal Consideration (just enough) Rest. 71

Is it asking for act or promise? Restatement 30

Sham Consid In re Greene (fraudulent conveyance)

(if not specified offeree can choose either 30(2)

Limits on Consideration

Killing an Offer:

- adequacy, ideas, foregoing legal right, charity donation,

accord and satisfaction

1. Lapse

Not consideration:

2. Rejection (38) or counter-offer (39)

3. Revocation Restatement 42 (indirect 43)
Irrevocable Offers:
1. Option K created by part performance (Rest. 45)
2. Bilateral K
87(1) written, signed, consideration ($)

1. Past Consideration
2. Unconscionability (adhesion) Restatement 208
3. Pre-existing duty
4. False Recital
Consideration not necessary
- contract modification

87(2) reliance construction Ks

- UCC 2-209

UCC 2-205 Firm Offer (no consid., 3 months, signed)

- UCC 2-206

Acceptance: Restatement 30
Acceptance by Promise:
- Notification Necessary (restatement 56)
- Good when received (exception: Mailbox)

- Restatement 89 fair/equitable
Mutuality of Obligation:
Illusory Promise: Implied terms & Satisfaction clauses (good
faith, reasonable, commercial standards)

or counter-offer?

Requirement/Output Contracts

- mirror image rule necessary (except UCC 2-207)

Conditional Promises (still good consideration

Acceptance by Performance

Promises of Alternative Performances

- Accepted by full performance (except Restatement 62)

___________________________________________________

- No need to notify unless requested Restatement 54

Promissory Estoppel: Promise + Reliance Rest. 90(1)

- If offeror has no way to know, discharged from K

Elements:

- Unless: tries to notify, reasonable time, acceptance

not required
Acceptance by Silence / Dominion Restatement 69
Who can accept? Restatement 52

1. Promise made w/ reason expect. that promisee would rely

2. Promise did induce action or forbearance
3. Enforcement necessary to avoid injustice
4. Limited remedy to reliance damages

Battle of the Forms (2-207) Diff. Terms in Acceptance

If expressly conditional (1) go to (3) triggers unless
If not, they are proposals. If merchants, terms in unless:
- 2-207 (2) exceptions
If not merchants, just proposals, do not become part of K unless
expressly conditional assent by offeror

Modern View: Assumption of the Risk

Restitution/Unjust Enrichment/Quasi Contract

1. As-is clause

Elements:

2. conscious indifference

1. Expected to be charged

3. Court decides

2. Opportunity to reject (appreciate the benefit)

Whiners Defenses: Intoxication & One-party mistake

3. a. gratuitous intent volunteer (cant reject b/c #1)

b. officious intermeddler cant recover b/c of #2
Exceptions: Duty & Emergency (can recover b/c #1)

Fraud/Misrepresentation
1. Fraud Restatement 162
a. Actual Fraud

Uncertainty of Agreements

b. Constructive fraud (fiduciary duty, superior knowledge)

1. Agreements to agree

2. Material

2. Gap fillers for material term left out

Non-disclosure assertion Restatement 161

3. Course of dealing, course of performance, trade usage

- dont be too strict use half-truth

UCC 2-204 K will not fail if terms left out if parties intend to
K

Parol Evidence Rule (when agreements dont apply)

STATUTE OF FRAUDS **** modifications must fall under

SOF if required
I. Is it a SOF question? If so, common law or UCC?
UCC 2-201 Sale of Goods
(1) K for sale of goods > $500
Requirements (can be oral agreement but needs written proof,
dont have to be merchants):

I. Exceptions
1. Collateral Agreements (If you can get parol evidence in, it
may make it a SOF problem)
2. Fraud
3. Condition Precedent
II. Integrated Writing
III. Is it complete (and final) or partially integrated (and final)?

1. Writing

1. Four Corners

2. Signature

2. Contextual (Traynor)

3. Quantity Terms

UCC 2-202 uses contextual approach can relate to 2-207

(2) Both have to be merchants

- look for merger clauses (intend only that K, no previous

agreements allowed)

1. Buyer sends written confirmation of K (10 days)

2. Sufficient against sender (must satisfy 2-201(1))

Contract Interpretation

3. Still has a quantity term

I. Is there ambiguous meaning?

(3) Exceptions:

II. Four Corners to examine meaning; or

1. specially manufactured goods (if reliance)

III. Parol Evidence Friendly Approach

2. Judicial Exceptions

1. Starts with K (Four Corners)

3. Part Performance

2. Then parol evidence

Mistake (one-party vs. two-party mistakes)

Two Party Mistake:
1. Different meanings (Peerless mistake)
2. Nature of Whats Being Bargained For
- Denver Dime and Barren Cow
- core qualities vs. enhancement qualities

- previous communication
- trade usage, course of performance
- impossibility of profit