What is the test to determine what governs a mixed contract?
Predominant purpose test
What are the essential terms of a common law contract?
Parties, subject matter, price, quantity
What is the essential term of a UCC contract?
Quantity (gap fillers are allowed for everything else)
What happens when both an acceptance and rejection are mailed?
- Oferee accepts and then rejects: acceptance controls unless offeror has relied
- Offeree rejects then accepts: first received by offeror controls
What are the three warranties and when can they be disclaimed?
- Express warranty –> has to be specific, general disclaimer isn’t valid
- Implied warranty of merchantability –> must use term “merchantability” and, if in writing, disclaimer must be CONSPICUOUS (“as is” works)
- Implied warranty of fitness for a particular purpose –> must be in writing and CONSPICUOUS (“as is” works)
When does the statute of frauds apply?
Mr. SOUR (Marriage, Suretyship, One year, UCC $500+, Real property)
What are the exceptions to the statute of frauds?
- Full or partial performance
- Unique/specifically manufactured goods
- Merchant’s confirmatory memo
When can a contract with an intended 3P beneficiary be modified or rescinded?
Before the 3P rights vest (detrimental reliance, manifests assent, sues to enforce K)
When does donee vs creditor 3PB status matter?
- Donee 3PB: Generally may only sue promisor (unless promisee tells 3PB about K and there’s detrimental reliance)
- Credtor 3PB: May sue either promisor or promisee
When does the UCC perfect tender rule not apply?
- Installment Ks (apply substantial performance standard)
What are expectation damages?
Put the nonbreaching party in as good a position as performance would have done
What are reliance damages?
Put nonbreaching party in the position as if the contract were never formed
What are the knock out/knock in rules?
- If one or both parties are not merchants: An acceptance from the offeree with changes or additions will be a valid acceptance, but w/o the changes or additions (knock out)
- If both parties are merchants, changes and additions comes in UNLESS a) materially alter terms, b) offer limits acceptance to terms of offer or c) offeror objects
- Warranty disclaimers or severe limitations on remedies are material changes
What is moral/past consideration?
Under the modern trend, a promise not supported by consideration may be enforceable if it is made in recognition of a significant benefit previously received by the promisor from the promisee.
What is promissory estoppel?
Substitute for consideration under a contract. The promise will be binding in the absence of consideration if:
* The promisor should reasonably expect the promise to induce action or forbearance;
* The promise actually induces action or forbearance; and
* Injustice can be avoided only by enforcement of the promise
When is a unilateral contract voidable for mistake?
The mistaken party can void (rescind) the contract if:
* The mistake would make enforcement of the contract unconscionable; or
* Non-mistaken party failed to disclose the mistake or caused the mistake
Plus: Absence of serious prejudice to non-mistaken party
What is the parol evidence rule?
Under the PER, extrinsic evidence of oral or written communications prior or contemperanous to the written contract (e.g., contract negotiations) are generally inadmissible for contradicting the terms of the contract.
What is a condition?
A condition is a future event that must occur before a party’s contractual rights or obligations are created, destroyed, or enlarged.
What can a nonbreaching party do in the face of an anticipatory repudiation?
The nonbreaching party can:
* Treat the repudiation as a breach of contract and sue immediately;
* Suspend its own performance and demand performance from the promisor;
* Cancel the contract; or
* Wait for the date of performance, and then sue for breach.
