Uniform Commercial Code

-deals with contracts involving goods

-goods: tangible, moveable items of personal property

-promise for promise exchange

-2 promises, 2 rights, 2 duties

-ex. Pearl promises to buy Paul's laptop for $1,000

-promise made to motivate action

-one promise, one duty, one right

-ex.Pat tells Alex he gets a $1,000 bonus if he sells 100 units

-parties actually discuss promised terms in an agreement

-ex. negotiated purchase of land for construction of manufacturing plant

-conduct of parties (not words)

-ex. asking an accountant's advice implies you will pay his going rate

-judicial remedy to prevent one party from recieving unjst enrichment

-AKA quasi-contracts

-ex. debtor pays creditor $5,000 extra...he can get it back under quasi-contract

-generally applies hen no contract exists to cover dispute

-enforceable if court upholds validity of promises

-unenforceable if justifiable reason for non-compliance

Valid Contract

Void Contract

-agreement that lacks enforceability because it lacks essential requirements

-ex. enforcing illegal activities (gambling, contraband)

Valid Contracts are ____a______

 Void Contracts are _____b____

Voidable Contracts are ____c_____

a)enforceable

b)unenforceable

c)enforceable until one party voids agreement

Executed Contract

contains a specific promise and specific demand

-ex. I will pay you $1,500 for laptop

promises $1,500 and demands a laptop

-contractual terms must be definite and specific

Offer Termination

-lapse of reasonable period of time

-rejection: "I don't want the flooring you're offering"

-counter-offer: "How about I pay $10 instead of $15

revocation: "I regret to inform you I'm ithdrawing my offer"

-destruction of subject matter

-death or insanity

Acceptance of Offer

-Bilateral vs. Unilateral

-Bilateral

acceptance when offeree makes required promise

(accepting terms)

-Unilateral

acceptance when preformance of requested act

($50,000 reward for info. on suspects)

Merchants

Mirror-Image Rule

-acceptance must mirror offer exactly

-otherwise its a counteroffer

-Acceptance binds parties when offeree dispatches it

-acceptance becomes binding when deposited to postal service

Unilateral: one party's promise; other party's performance of an act

Bilateral: each party's promise

agreement not to sue 

if two parties resolve a dispute of the amount owed

I hit a car... give them a hundred bucks and they cant sue

agreement not to revoke an offer 

must be supported by offeree's consideration

occurs when promisee relies on promisor's promise to his economic injury

used to prevent a party who has made a unilateral offer from withdrawing the offer after work has begun

minors

mentally incompetent

intoxicated people

-contracts that restrain trade 

-illegal unless they have a valid business purpose

-can't restrain competition too long

-area restrained can't exceed area of business operations

(reasonableness as to time and space)

intentional misstatement of important fact that induces one to rely justifiably to his injury

force or threat of force

-contracts induced by duress are voidable

one is taken advantage of through a contract by a party who misuses a position of relationship or legal confidence

-voidable

-cancels contract and returns consideration to both parties

-occurs when mutual mistake is made

Statute of Frauds

Contracts that must be Written

(4)

-contracts involving interest in land

-collateral contracts to pay debt of another person

-contracts that connot be preformed within a year

-contracts for the sale of goods of $500 or more

part performance: oral agreement is enforceable for land if buyer has possession and has paid something or made improvements

rules involving goods 

judicial admissions: oral agreement is enforceable if defendent admits there was a contract

Third Party Beneficiaries

creditor beneficiary Carl owes Terry money for work already performed. Carl does work for Chris and has Chris pay Terry

donee beneficiary performance of contract is gift to third party (parent buys a car for you, you an sue)

incidental beneficiary unintentionally benefits from contract...no rights to sue

transfer (generally a sale) of rights under contract

assignor assigns rights to third party

assignee receives rights

three or more party contract in which the original contracting parties agree to relieve the obligor from liability by substituting him with an assignee

sign a novation to place liability of last 6 months rent on your friend 

prohibits testimony about oral negotiation in a written contract

(prohibits testimony only at time or before contract)

one party must perform before there is a right to performance by the other party

I dont have to do this until this happens

excuses contractual performance if some future event takes place

if war is declared...I don't have to pay you

if this happens....I don't have to perform

mutual conditions where each party's contractual performance is triggered by the other party's offering performance

simultaneous duty to perform

complete performance: fullfillment of every duty

material breach: below what is reasonablly acceptable 

Substantial Performance: less than complete but more than material breach

1. complete performance

2. tendering performance if that tender is rejected

3. Substantial Performance

4. Performance of part of a divisible contract

not as difficult to meet as impossibility standard

ex. suppliar's major source of raw materials interrupted

one party intentionally releases right to enforce contract

ex. landlord not enforcing late check when its only 2 days overdue

One party says the other party doesn't have to perform

usually occurs before a party fails to perform

negotiated settlement

arbitration

various awards 

specific performance

Rescission

purposeful reduction of damages

usually the responsibility of the non breaching party

actual authority

expressed, written authority

implied authority

apparent authority

specific instructions given to agent 

ex. you own restaraunt...tell your employee to buy $100 worth of coffee...you are responsible for paying the $100

derives from history of representation

-fire employee and he buys a bunch of shit from grocery store you used to send him to

notice of termination destroys apparent authority

let the master reply

employer is liable for a tort performed by employee (agent) if  acts are in the scope of employment