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FUCK CONTRACTS!
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Law
06/27/2013

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Term
When is the UCC applicable vs. the common law?
Definition
The sale of goods are governed by the UCC. Everything else is governed by the common law.
Term
When there are goods/services in a contract, does the UCC or the common law govern?
Definition
You have to ask what the "predominant purpose of the contract" was. If the predominant purpose was goods, UCC otherwise common law.
Term
Is mutual assent viewed from the parties' subjective intent, or from their objective actions?
Definition
Objective.
Term
What is an offer? What are the requirements?
Definition
An objective manifestation of a willingness by the offeror to enter into an agreement that creates the power of acceptance in the offeree.

1. The offeree must know of the offer to have the power to accept.
2. The terms of the contract must be certain and definite.
3. The contract must contain all essential terms (different under UCC and common law)
Term
What are the essential terms under the common law?
Definition
The parties, subject matter, price, quantity.
Term
What are the essential terms under the UCC?
Definition
Quantity, parties, subject matter.

Quantity is not required for requirements or output contracts.
Term
If the contract does not specify a duration, how long until performance is due?
Definition
A reasonable time.
Term
If an employment contract does not state duration, what presumption arises?
Definition
That the employment was at will, and either party can terminate the employment at any time without a breach arising.
Term
If an employment contract provides for a "permanent employment" how long does the employment last?
Definition
The contract is presumed to be at will
Term
If the offer can be accepted by performance only, what type of contract is it?
Definition
A unilateral contract.
Term
If the offer can be accepted by either promise or performance, what type of contract is it?
Definition
Bilateral contract
Term
What is the difference between an offer and an invitation to deal?
Definition
It's the difference between the definiteness of the language and the willingness to be bound by acceptance.
Term
Advertisements are not offers unless:
Definition
Associated with a stated reward OR the advertisement is sufficiently specific and limiting as to who may accept.
Term
How long after the offer is made does the offer lapse?
Definition
Unless the offer specifies a specific date, the offer terminates after a reasonable period of time.
Term
Does an offer terminate upon the death or mental incapacity of the offeror?
Definition
Yes.
Term
Does an offer terminate when the subject matter of the contract is destroyed or becomes illegal?
Definition
Yes
Term
When can the offeror revoke an offer?
Definition
Any time prior to acceptance, even if the offer states that it will remain open for a specified amount of time.
Term
When is revocation effective through the mailbox rule?
Definition
When it is received by the offeree.
Term
What is an option?
Definition
An independent promise to keep an offer open for a specified period of time. The offeree must generally give separate consideration for the option to be enforceable.
Term
What is the merchant's firm offer rule?
Definition
An offer to buy or sell goods is irrevocable for a specified period of time if:
1. The offeror is a merchant
2. There are assurances that the offer is to remain open.
3. The assurance is contained in an authenticated writing
4. For a specified period of time no longer than 90 days.
Term
What are the exceptions to the general rule that an option must have consideration under the common law or under the UCC with a non-merchant seller?
Definition
Promissory estoppel and Partial performance.
Term
How can a general offer (through an advertisement) be revoked?
Definition
Notice that is given at least the same level of publicity as the offer.
Term
What is a merchant?
Definition
A merchant is a person who regularly deals in the type of goods involved in the transaction OR
any business person when the transaction is of a commercial nature.
Term
What is a counteroffer?
Definition
A rejection and a new offer.
Term
What is an acceptance?
Definition
The objective manifestation by the offeree to be bound by the terms of the offer.
Term
When is a unilateral contract accepted?
Definition
Upon completion of performance, however, an option is created upon the start of performance which allows the offeree to finish performance within a reasonable period of time.
Term
If the offeree of a unilateral contract has reason to know that the offeror would not reasonably learn of his performance, when will the offeree be relieved of his duty to inform?
Definition
Either
1. Exercise reasonable diligence to notify the offeror of acceptance
2. The offeror actually finds out some other way.
3. The offer indicated that notification of acceptance is not required.
Term
How can acceptance of a shipment for goods be consummated?
Definition
Either by promise to ship or prompt shipment.
Term
What is the mailbox rule?
Definition
An acceptance that is mailed within the allotted response time is effective upon posting (dropping in the mailbox) unless the offer provides otherwise.
Term
What happens through the mailbox rule when a rejection follows acceptance?
Definition
Acceptance is binding upon dispatch.
Term
What happens through the mailbox rule when an acceptance follows rejection?
Definition
The mailbox rule is void, and the first to be received is binding.
Term
Does the mailbox rule apply if the offer is irrevocable?
Definition
No, the offeror must learn of the acceptance, the mailbox rule is inapplicable.
Term
What is the requirement for the medium of acceptance?
Definition
Any reasonable medium.
Term
Can silence constitute an acceptance of an offer under the common law?
Definition
Only if
1. The offeree has reason to believe that the offer could be accepted by silence and intended to accept by silence.
2. Because of previous dealings, it is reasonable to believe that the offeree would want to accept by silence.
Term
What is the common law mirror image rule?
Definition
Acceptance must mirror the terms of the offer. Any modification or addition of another term will constitute a rejection and a counteroffer.
Term
What is the UCC rule for acceptance when the parties are not merchants?
Definition
Terms that are additional or different are treated as a proposal for addition to the contract. If they are not expressly accepted by the other party, they do not become part of the contract.
Term
What is the UCC rule for acceptance when the parties are merchants?
Definition
Terms that are additional or different are treated as accepted unless
1. The terms materially alter the agreement
2. The offer expressly limits the terms
OR
3. The offeror has already objected or objects to the new terms within a reasonable time after notice of the new terms is received.
Term
What is consideration?
Definition
Some legal detriment that must be bargained for in order for a contract to exist.
Term
What is the test to distinguish a gift from valid consideration?
Definition
Whether the offeree could have reasonably believed that the intent of the offeror was to induce the action.
Term
What is the preexisting duty rule?
Definition
A promise to perform a preexisting legal duty does not qualify as consideration because the promisor is already bound to perform the duty.
Term
Can past consideration be consideration?
Definition
No
Term
At common law, what is required to modify an existing contract?
Definition
Consideration
Term
What is required to modify under the UCC
Definition
Just good faith
Term
A contract modified that falls within the statute of frauds must...
Definition
Generally be in writing. If one party reasonably relies on it, you waive the failure of the modification.
Term
What is an accord and satisfaction
Definition
Under an accord agreement, one party to a contract agrees to accept different performance from the other party than what was promised in the existing contract.

A satisfaction is the performance of the accord agreement which will discharge the original contract and the accord agreement.
Term
WHat is an illusory promise?
Definition
A promise that pledges nothing because it is vague or because the promisor can choose whether to honor it.
Term
a promise to purchase goods upon the promisor’s satisfaction with the goods is not illusory...Why
Definition
because the promisor is required to act in good faith.
Term
Does a voidable or unenforceable promise lack consideration?
Definition
No
Term
What is a requirements contract?
Definition
It is a contract under which the buyer agrees to buy all that he will require of a product from a seller.
Term
What is an output contract?
Definition
An agreement where a seller agrees to sell all that she manyfactures of a product to the buyer.

Under the UCC any quanitities under such a contract may not be unreasonably disproportionate to a stated estimate. Good faith is required.
Term
What promises are binding without consideration?
Definition
1. A promise to pay a debt barred by the statute of limitations.
2. A promise to perform a voidable duty.
3. A promise to pay a material benefit already received. (Material benefit rule) The rule is NOT ENFORCED when the performing party rendered services without the expectation of compensation.
Term
What are the elements of promissory estoppel?
Definition
1. A promise
2. The promisor should reasonably expect it to induce action or forbearance on the part of the promisee or a third person
3. The promise does induce such action or forbearance.
4. Injustice can be avoided only by enforcement of the promise.

Generally remedy is equitable meaning reliance damages rather than expectation.
Term
What is the promissory estoppel doctrine applicable to charities?
Definition
Courts will presume that the charity detrimentally relied on the promised contribution even without proof of actual reliance.
Term
Does promissory estoppel apply in a construction contract?
Definition
Generally, a general contractor is not bound to accept the bid of a sub-contractor. A sub-contractor is not bound to accept a bid by a general contractor either, but an agreement not to revoke a sub-bid can be enforced with consideration.
Term
What is the difference between a void, voidable, and unenforceable contract?
Definition
Void: The contract never existed.
Voidable: One party can take step to avoid the contract.
Unenforceable: Valid K that can't be enforced if one of the parties refuses to carry out its terms.
Term
What are the requirements for a unilateral mistake of fact.
Definition
A mistake is a belief that is not in accord with the facts as to a basic assumption on which the contract was made that materially affects performance.

The mistaken party can void the contract if:

1. The mistake would make enforcement of the K unconscionable OR
2. The non-mistaken party either failed to disclose the mistake despite knowing or having reason to know OR
The other party caused the mistake
AND
3. The party seeking to void did not bear the risk of the mistake
Term
What is a mutual mistake of fact?
Definition
When both parties are mistaken as to an essential element of the contract with no intent by the parties to take a risk on that element of the transaction.

The contract is voidable by the party that was adversely affected.

The party seeking to void will not be able to void when they are aware that at the time of the contract they have only limited knowledge of the facts which the mistake relates and they accept their limited knowledge as sufficient.
Term
Is reformation of the contract available if there is a mutual mistake of fact?
Definition
Yes if:
1. There was a prior agreement
2. There was an agreement by the parties to put that prior agreement into writing
3. As a result of a mistake, there is a difference between the prior agreement and the writing.
Term
What is a misunderstanding?
Definition
Misunderstanding occurs when both parties believe that they are agreeing to the same material terms, but in fact they agree to different terms.
Requirements:

1. Neither party knows or should know of the misunderstanding

If one party knows of the misunderstanding:
The contract will be reformed based on the meaning of the term as understood by the unknowing party.

If both parties know of the misunderstanding:
There is no contract unless both parties intended the same meaning.

MISUNDERSTANDING CAN BE WAIVED BY EITHER PARTY
Term
What constitutes fraudulent misrepresentation?
Definition
A misrepresentation is an assertion that is contrary to the FACTS. Must be affirmative conduct to conceal a fact from another.
Misrepresentation can be innocent, negligent, or fraudulent.

When a statement or concealment of FACT is made:
1. Knowingly
2. Without confidence in the assertion
3. When the person making the assertion knows that no basis exists for the assertion.
4. With nondisclosure and knowledge of a known fact
Term
When will nondisclosure of a known fact constitute misrepresentation?
Definition
When
1. Disclosure is necessary to prevent a previous assertion from being a misrepresentation or fraudulent
2. When disclosure would correct a mistake of the other party as to a basic assumption and the failure to disclose would constitute lack of good faith and fair dealing
3. Disclosure would correct a mistake or the other party as to the contents or effect of a writing evidencing their agreement
OR
4. The other party is entitled to know of the fact because of a confidential/fiduciary relationship.
Term
What is the difference between fraud in the factum and fraud in the inducement?
Definition
Factum: When the misreprenentation prevents the party from knowing the character or essential terms of the transaction.

Inducement: When fraudulent inducement is used to induce another to enter into a contract.

Fraud in the factum is not enforceable against the other party unless reasonable diligence would have revealed the true terms.

Inducement is voidable by the affected party.
Term
What is undue influence? What are the key triggers? What are the remedies
Definition
Undue influence is the unfair persuasion of a party to assent to a contract.

Confidential relationship.

Restitution and avoidance of the K
Term
What is duress?
Definition
An improper threat that deprives a party of meaningful choice.

Threat can be of a crime, criminal prosecution, tort, or threat of civil action in bad faith.

Physical duress avoids the K
Otherwise, it's voidable.

Restitution damages are available.
Term
What effect does infancy have on a K?
Definition
A person under 18 generally does not have the capacity to contract. Therefore, a contract made by an "infant" is voidable by the infant.

Infants, however, are liable for "necessities" and statutory exceptions.
Term
What effect does mental illness have on a K?
Definition
An adjudicated mentally ill person the K is void.
If not adjudicated, the K is voidable if the person is unable to:
1. Understand the nature and consequences of the transaction
OR
2. Act in a reasonable manner with regard to the transaction and the other party has reason to know this fact.
Term
When is an intoxicated person able to avoid the contract?
Definition
When the person is unable to understand the nature and consequences of the transaction and the other party had reason to know. The intoxicated party must act promptly to disaffirm the contract and is required to return any value received, if possible.
Term
If the consideration or performance under the K is illegal, what happens?
Definition
The contract is unenforceable.
Term
What are the exceptions to the general rule that when the consideration or performance under the K is illegal, the K is unenforceable?
Definition
1. Justifiable ignorance
2. Party lacks illegal purpose
3. The party can be divided
4. Licensing violations
5. Obtaining restitution
Term
When is a contract unconscionable?
Definition
When it is so unfair to one party that no reasonable person in the position of the parties would have agreed to it AT THE TIME IT WAS MADE
Term
What are examples of when a K is void for public policy?
Definition
1. Contracts in restraint of marriage.
Term
What is an implied in fact contract?
Definition
When conduct indicates assent or agreement, the agreement is considered implied in fact.
Term
What is an implied in law (quasi-K)
Definition
When one party confers a benefit on another and has a reasonable expectation of compensation.

Requirements:
1. The plaintiff has conferred a measurable benefit on the defendant
2. The plaintiff acted without gratuitous intent
And
3. It would be unfair to let the defendant retain the benefit because the D either had an opportunity to decline or he had a reasonable excuse for not giving D the opportunity to decline.

Generally restitution damages are available.
Term
What can a plaintiff recover in quasi-K if the P has not substantially performed?
Definition
Quantum meruit (as much as he deserved) if they can show the recipient:

1. Acquiesced in the provision of services
2. Knew that the provider expected to be compensated
AND
3. Was unjustly enriched
Term
What are the types of warranties available under the UCC?
Definition
1. Express warranty (Promise, affirmation, description, or sample that is part of the basis for the bargain. Not opinions)

2. Implied warranty of merchantability: (Implied whenever the seller is a merchant that the goods will be fit for their ordinary purpose and pass without objection in the trade under the contract description)

3. Implied warranty of fitness for a particular purpose (Implied whenever the seller has reason to know that the buyer has a particular use for the goods and the buyer has a particular use for the goods and the buyer is relying upon the seller's skill to select the goods)
Term
When is performance impracticable?
Definition
1. Performance becomes illegal after the contract is made
2. The specific subject matter of the contract is destroyed
3. In a services contract, the performing party becomes incapacitated or dies
4. Performance becomes impracticable meaning:
1. An unforeseen event has occurred
2. The non-occurrence of the event was a basic assumption on which the K was made.
3. The party seeking discharge is not at fault
Term
Does the defense of impracticability apply if one party assumed the risk of the K?
Definition
No
Term
When a contract has become partially impracticable, what happens?
Definition
The party must still perform, but the buyer may refuse to accept the deficient performance and cancel the K.
Term
If the contract provides a specific source of supply to be used that fails, is performance discharged?
Definition
Yes
Term
When does frustration of purpose come into play?
Definition
When an unexpected event arises that destroys one party's purpose in entering into the contract, even if the contract is not rendered.

The event must not be the fault of the frustrated party and the non-occurrence must have been a basic assumption on which the K was based.
Term
What is required to modify under the UCC
Definition
Just good faith
Term
A contract modified that falls within the statute of frauds must...
Definition
Generally be in writing. If one party reasonably relies on it, you waive the failure of the modification.
Term
What is rescission?
Definition
A non-defaulting party to a K can cancel or rescind the K which requires return of any deposits or other benefits conferred on the other party. Not available in third party Ks where the rights of the third party have vested.
Term
What is a release?
Definition
A writing that manifests intent to discharge another party from an existing duty. Under common law, there must be consideration. Under the UCC, no consideration is required.
Term
Who is a third party beneficiary to a K?
Definition
When two parties enter into a contract with the understanding and intent that performance by one of the parties is to be rendered to a third person.
Term
What is the difference between a creditor and donee beneficiary and what is the effect?
Definition
A creditor beneficiary is a person to whom a legal obligation is owed by a party. A donee beneficiary is someone who will get a benefit from the contract by way of gift.

A donee beneficiary may only sue the promisor to enforce the contract.
A creditor beneficiary may sue either party to enforce the contract.
Term
What is the difference between an intended and incidental beneficiary?
Definition
Intended: One to whom the promisee wishes to make a gift of the promised performance or to satisfy an obligation to pay money owed by the promisee to the beneficiary.

Incidental: They benefit, but there is no contractual intent.

An intended beneficiary may recover, but not an incidental beneficiary.
Term
How can a 3rd party's rights vest and what is the effect of vesting?
Definition
Vest when the third party:
1. Detrimentally relies on the rights created
2. Manifests assent to the K at one of the parties' request
3. Files a lawsuit to enforce the K

Effect:
The original parties to the K are both bound to perform the contract. Any effort to modify or rescind after vesting are void unless the 3rd party agrees.
Term
What defenses are available against a third party-beneficiary?
Definition
Any defenses that are available against the original contracting party.
Term
What is the difference between an assignment and a delegation?
Definition
Assignment: The transfer of rights under a contract
Delegation: The transfer of duties and obligations under a K
Term
When is an assignment not allowed?
Definition
When they:
1. Materially increase the duty or risk of the obligor
2. Materially reduce the obligor's chances of obtaining performance
3. An anti-assignment clause will operate as breach of contract only.
Term
When is an assignment revocable/irrevocable.
Definition
If the assignment is for consideration, it is irrevocable.
If there is no consideration, it is generally revocable unless part performance/promissory estoppel applies.
Term
What are the rights of an assignee to a contract?
Definition
They take all the rights of the assignor as the contract stands and subject to a defense that could be raised against the assignor. Also, the obligor can use the defense of payment to the assignor prior to notice of the assignment as a defense to double payment.
Term
When is delegation not permitted?
Definition
When the other party to the contract has a substantial interest in having the delegating party perform or the delegation is prohibited by contract.
Term
When obligations are delegated under a K, is the delegator released from liability under the K?
Definition
No.
Term
What is a novation?
Definition
A K that relieves an obligated party of liability.
Term
Can a delegation constitute reasonable grounds for insecurity?
Definition
Yes
Term
How does a contract comply with the statute of frauds?
Definition
It must be:
1. In writing
2. Signed by the party to be charged
3. Contain the essential elements of the deal.

Can simply be a confirmation.
Term
What types of contracts must comply with the SOF
Definition
Mr. SOUR
1. Contracts in consideration of MARRIAGE (prenup)
2. Suretyship (Promise to pay the debt of another
3. Contracts that cannot possibly be performed within ONE YEAR
4. Sale of goods under the UCC for $500 or more
5. REAL PROPERTY contracts (applies to options, right of first refusal, mortgages/liens)
Term
What are the exceptions to the statute of frauds
Definition
1. Specially manufactured goods under UCC 500
2. Partial payment for the item
3. Receipt and acceptance of goods
4. Judicial admission to the existence of a contract.
5. Failure to respond to a memo under the UCC additional terms between merchants rule.
Term
What is the difference between complete and partial integration, and what is the effect on the parol evidence rule? What is the rule for determining under the common law and UCC?
Definition
Complete integration means the writing completely expresses all the terms of the parties.
A partial integration is a writing that does not contain all terms of the agreement.

Under common law, you look at the four corners of the document to determine whether the document is a complete integration.
Under the UCC, the court asks if the omitted term "would have certainly been included in the written contract. If not, the evidence is admitted.
Term
Under PER when does the court admit evidence which is contradictory to the express terms of the contract?
Definition
NEVER.
Term
When is the PER inapplicable?
Definition
1. Raising an excuse
2. Establishing a defense
3. A distinct and separate contract
4. Conditions precedent
5. When there is a latent or patent ambiguity.
6. Trade usage and course of dealings.
Term
What is an express condition?
Definition
A condition contained in the contract. "Provided that" "on the condition that"
Term
Can a condition be implied?
Definition
Yes.
Term
If a defendant's duty is subject to a condition precedent, who has the duty to establish that the condition was met?
Definition
The plaintiff.
Term
When the aesthetic taste of an individual is a condition of satisfactory performance, and that individual in good faith determines that the work is not satisfactory, does that person have to perform?
Definition
No. If the condition requires aesthetics, all that is required is good faith. If it doesn't require aesthetics, the courts will use the reasonable person standard.
Term
What is the doctrine of substantial performance, and when is it applicable?
Definition
It provides that a party who substantially performs can recover on the K even though full performance is not tendered.
No recovery is allowed for wilfull failure.

Under the common law, substantial performance will not excuse performance of the other party if the omitted performance is not material. Under the UCC, the perfect tender rule requires perfect tender. However, under the UCC, the seller of goods must be given a reasonable time to cure non-conforming goods.
Term
If a UCC K is silent on several terms of the K, when is the time, manner, place, and method of performance due?
Definition
time: Reasonable time after the K is made
Manner: Delivered in one delivery unless difficult
Place: Seller's place of business
Method depends on type of K.
Term
What is the difference between a shipment and a destination contract?
Definition
A contract F.O.B. the place of shipment must deliver the goods to the carrier and make contract for shipment and give notice of shipment.
Destination: F.O.B. buyer's place of business and the seller must deliver the goods to a particular place and tender them there by holding the goods at the buyer's disposition and giving the buyer notice.
Term
Under a divisible or installment contract under the UCC, what is the limit to recovery?
Definition
The amount promised for the SEGMENT of the contract performed.
Term
If the seller makes a nonconforming tender under the UCC in an installment K, can the buyer reject the entire contract for the nonconformity of an installment?
Definition
Only if the nonconformity:
1. Substantially impairs the value of that shipment to the buyer
AND
2. It cannot be cured.
Term
What is wrongful interference?
Definition
Because a duty of good faith and fair dealing is implied into all contracts, one of the duties is not to hinder the other part's performance.
Term
Under the common law, when there is a breach, when must the non-breaching party nonetheless perform?
Definition
When the breach is not material i.e. the breaching party has substantially performed.
Term
What is an anticipatory repudiation?
Definition
When a promisor makes a clear and unequivocal repudiation of a promise under the contract.
Term
What can the non-repudiating party do in the event of an anticipatory repudiation?
Definition
1. Ignore it and demand performance, but he must suspend his own costly performance
2. Sue for breach
Term
A repudiation may be retracted by the repudiator unless
Definition
The promisee
1. Acts in reliance on the repudiation
2. Signifies acceptance of the repudiation
OR
3. Commences an action for breach
Term
Can a person repudiate a unilateral contract?
Definition
No
Term
Under the UCC if a party has reasonable grounds for insecurity that the other will perform, what steps can that person take?
Definition
Demand for adequate assurances. If the other party fails to provide assurances within 30 days of the demand, the promisee can treat it as a breach.
Term
What are expectation damages?
Definition
They are intended to put the injured party in the same position as if the contract had been performed. They are damages that arise naturally from the breach. They are normally measured by the market value of the performance minus the consideration promised by the non-breaching party.
Term
In a construction contract, other than normal expectation damages, what can the parties recover from the breaching party?
Definition
Constructor: The profits they would have earned plus costs incurred minus payments by the owner Owner: Compensation for delay in completion of the project.
Term
If the other party partially performs the K before breach, what is recoverable under expectation damages?
Definition
Money for costs incurred performing plus potential profit to be earned from the job.
Term
If part performance in constructing property for someone, what can the nonbreaching party recover?
Definition
Cost of repair or completion.
Term
What are consequential damages and what are the requirements?
Definition
Reasonably foreseeable losses that go beyond expectation damages.

Foreseeable means the natural and probable consequences of breach.

Damages must be proven with reasonable certainty.
Term
What is a liquidated damages clause and is it enforced?
Definition
They are an amount contractually stipulated as a reasonable estimation of actual damages to be recovered by the nonbreaching party.

They must be reasonable in light of actual and anticipated damages at time of contract.
Term
What is the three pronged test for enforcement of an LD clause?
Definition
1. The parties intended to agree in advance to the settlement of damages
2. The amount of liquidated damages is reasonable
3. Actual damages would be uncertain
Term
What are incidental damages?
Definition
Commercially reasonable expenses incurred as a result of the breach. In sale of goods, damages may include the cost of inspection, transport, caring for or maintaining goods.
Term
Are punitive damages appropriate in contract actions?
Definition
Only rarely to punish for fraud, breach of fiduciary duty, bad faith etc.
Term
In an action for breach, may a non-breaching party recover for nominal damages?
Definition
Yes.
Term
What is a party's obligation to avoid or mitigate damages?
Definition
To the extent they reasonably can. Failure to mitigate will reduce the damage award.
Term
What is restitution and how is it measured?
Definition
The fair market value of the benefit conferred measured by either the reasonable value of obtaining the value from another source or increase in value from the conferral of the benefit.
Term
What are reliance damages?
Definition
May be recovered by the nonbreaching party incurring expenses in reasonable reliance upon the promise that the other party would perform.
Term
Can a party recover reliance and expectation damages?
Definition
No.
Term
What factors are considered when deciding to award specific performance?
Definition
Damages must be an inadequate remedy.

1. Difficulty of proving damages with reasonable certainty
2. Difficulty procuring a suitable substitute performance by means of money award
3. Likelihood that an award of damages will be collected.
Term
When will specific performance not be awarded?
Definition
1. When the court cannot supervise enforcement
2. Personal service contracts.
Term
Under the UCC, what are a buyers' remedies for a nonconforming tender
Definition
1. Market price minus the contract price+ incidental and consequential damages
2. Cover (replace the goods with similar ones and deduct the new price from the bargained price.
3. Specific performance (usually available if the buyer is unable to cover)
4. Replevin
Term
What is replevin?
Definition
When a buyer has made partial payment for identified goods, the buyer can obtain the undelivered goods from the seller if:

1. The seller becomes insolvent within 10 days of receiving the first payment
OR
2. The goods were for personal or family purposes
Term
Under the UCC, how does the buyer reject non-conforming goods?
Definition
1. Give notice to the seller
2. Within a reasonable time
3. Before acceptance
4. Buyer must retain possession of goods for reasonable time to allow seller to claim them.
Term
Can a buyer charge a seller for storage of non-conforming goods after breach?
Definition
Yes
Term
Under the UCC, a buyer accepts goods by:
Definition
1. Expressly stating acceptance
2. Using the goods
3. Failing to reject the goods
Term
Under the UCC, a seller has an unequivocal right to cure if:
Definition
1. The time for performance under the contract has not elapsed
AND
2. The seller had reasonable grounds to believe that the buyer would accept despite the nonconformity
Term
When is payment due generally in a sale for goods under the UCC?
Definition
After the goods are physically delivered to the buyer and the buyer has an opportunity to inspect, unless the contract provides otherwise.
Term
When a buyer is insolvent, when can a seller reclaim goods under the UCC?
Definition
They must make a demand within 10 days after the receipt of the goods. ONLY WORKS WHEN THE BUYER RECEIVED THE GOODS ON CREDIT WHILE INSOLVENT.

In a C.O.D. sale, the seller can reclaim goods if the buyer's check bounces.
Term
Can goods be stopped in transit if the buyer breaches?
Definition
Generally only for large shipments.
Term
If a buyer wrongfully rejects conforming goods as non-conforming, what are a seller's remedies?
Definition
Collect damages
OR
Resell the goods
OR
Recover the price of the K only if the goods are not sellable
AND
Collect incidental damages
And
Collect lost profits
Term
If goods are damaged or destroyed without the fault of either party, who generally bears the risk of loss?
Definition
The seller until it is delivered.
Term
In a shipment contract who bears the risk of loss?
Definition
The buyer once the seller gives possession of the goods to a common carrier and makes a contract for shipment.
Term
Who bears the risk of loss in a destination contract?
Definition
The risk of loss passes to the buyer once the seller tenders at the place specified in the contract.
Term
If a contract deals with identified goods, the seller is excused from fault if:
Definition
the goods are destroyed without the seller's fault prior to the shifting of the risk of loss.
Term
What is the statute of limitations in an action for breach of contract under the UCC?
Definition
Under the UCC it's 4 years. Parties may reduce to 1 year, but may not extend.