a MANIFESTATION OF COMMITMENT to K such that a reasn. person in offeree's position would believe assent would create a K.
What are the requirements for a valid real estate sales K?
Written (SoF), signed by party to be bound, names the parties, contain PRICE TERM and DESCRIPTION
What is required for a K for Sale of Goods?
Must contain QUANTITY TERM (n.b. fulfillment Ks allowed); written and signed by party to be bound if over $500 (SoF).
S offers to sell blackacre to B for a reasonable price. B accepts. S changes mind and refuses to perform. B sues for specific performance.
B loses b/c there is no K.
VAGUE/AMBIGIOUS MATERIAL TERMS terminate an offer.
How are offers terminated?
Lapse (time stated or reasonable time, i.e. >30 days)
Death prior to acceptance (unless irrevocable offer)
Revocation (unambigious STMT TO OFFEREE of unwillingness to K, or unambiguous CONDUCT indicating same which OFFEREE KNOWS OF)
Describe the consequences of the following contractual provisions: (1) "assignment of the K prohibited." (2) "assignment of contractual rights prohibited." (3) "all assignments void."
A clause prohibiting assignment of "the K" will be construed as barring only DELEGATION OF THE ASSIGNOR'S DUTIES.
Prohibition of assignment of "contractual rights" does not bar assignment, but gives OBLIGOR RIGHT TO SUE FOR DMGS.
Provision that attempts to assign are void BARS ASSIGNMENT.
Are assignments revocable?
Assignments for VALUE (i.e. done for consideration or taken as security/pmt for preexisting debt) are IRREVOCABLE.
GRATUITOUS assignments generally REVOCABLE. Exceptions: (i) obligor already performed; (ii) a token chose is delivered; (iii) assignment of simple chose put in writing; (iv) assignee detrimentally relies on the gratuitous assignment [ESTOPPEL].
How can gratuitous assignments be revoked?
DEATH/BANKRUPTCY of assignor;
NOTICE of revocation by assignor to assignee OR obligor;
assignor taking performance directly from the obligor; or
subsequent assignment of the same right by assignor to another.
Name the irrevocable offers.
"Firm offer": (i) offer to sell goods; (ii) signed, written promise to keep offer open; and (iii) party is a merchant (i.e. person in business). *N.b. valid for 3 months max
Reliance: (i) reasn. foreseeable; (ii) detrimental
Start of performance of unilateral K: offer irrevocable for a reasn time to complete perf
B responds to S's offer by saying, "I accept if you guarantee delivery by tomorrow." S accepts and delivers.
What is the issue? What result if B is buying: (1) a house; (2) a car?
At issue is the effect of CONDITIONAL ACCEPTANCE.
(1) At CL, cond. acceptance rejects and becomes a COUNTEROFFER that can be accepted by conduct. Valid K.
(2) UCC treats cond. acceptance as REJECTION; no K.
B signs and returns S's offer, adding "delivery guaranteed by tomorrow."
Is there a K if B is buying (1) a house; (2) a car? Is the delivery term a part of the K?
(1) at CL, acceptance with additional terms is a COUNTEROFFER under the MIRROR IMAGE RULE. Additional term incl if offeree accepts.
(2) UCC: response to offer that adds additional terms generally accepts as a SEASN. EXPR. OF ACCEPTANCE (merchant irrelevant for step 1). Additional term part of K if (i) BOTH parties are MERCHANTS; and (ii) new term NOT MATERIAL & offeror doesn't object.
O offers P $50 to paint his mailbox. P does not accept or reject. The next day, P begins painting the house.
General rule: START OF PERFORMANCE is ACCEPTANCE (treated as implied promise to perform, creating bilateral K)
*N.b. can't accept unilateral Ks by start of performance, but makes offer irrevocable for reasn. time
State the rules pertaining to delayed communications (e.g. mail) as acceptance/rejection.
Mailbox rule: acceptance effective when mailed.
Communications other than acceptance effective upon receipt.
If a rejection is mailed before an acceptance, neither effective until rec'd.
Can't use mailbox rule to meet an option deadline.
B orders 100 green widgets. In response, S sends 100 blue widgets.
What result? What result if B encloses note saying "out of green, hope blue works"?
General rule: sending nonconforming goods in response to offer is ACCEPTANCE & BREACH.
ACCOMMODATION: sending nonconforming goods in accommodation treated as COUNTEROFFER.
S agrees to sell X for $500k, and B tenders the purchase price. X now refuses to deliver unless B pays an additional $5k convenience fee. B signs an agreement to pay it and takes delivery of X. When S demands the $5k, B refuses to pay.
What result if (1) X is a sports car; (2) X is Blackacre?
(1) UCC doesn't impose the PRE-EXISTING LEGAL DUTY RULE; new consideration not req'd to modify; GOOD FAITH modifications valid.
(2) At CL, NEW CONSIDERATION REQ'D for modification under the PELD Rule. Exceptions for addition to/change in performance; unforeseen difficult so severe as to excuse performance, and 3P promise to pay.
C owes D $1k, but the statute of limitations bars collection. C writes D "I know I owe you $1k. I will pay you $600."
What result if C later refuses to pay upon learning about the SoL?
WRITTEN PROMISE to satisfy an obligation for which there is a legal defense enforceable WITHOUT CONSIDERATION.
Assume B, who is 15, agrees to pay S $500/mo for rental of an apt. B takes possession of the apt but refuses to pay rent.
Can S enforce the agreement?
No, persons without capacity are NEVER CONTRACTUALLY LIABLE.
However, B will be liable in QUASI-K for the FAIR RENTAL VALUE.
How can the SoF be satisfied other than by a writing.?
Performance. In xfer of real est., part perf satisfies (2 of 3);
In perf & svcs Ks, full perf by either party only; part perf insuff
UCC Art 2: S's part perf. for ORDINARY goods satisfies ONLY TO EXTENT OF PERF; for SPL MFG GOODS, SoF satisfied by S's SUBSTANTIAL BEGINNING.
What test applies to determine whether a writing satisfies the SoF?
CL agreements: ALL MATERIAL TERMS Test
Article 2: QUANTITY TERM only
What happens if P sues D on a K w/in the SoF, and for which there is no writing, but P asked for a writing?
D may be ESTOPPED from asserting an SoF defense if:
(i) P detrimentally relied on the oral agreement; (ii) P asked for agreement to be reduced to writing; and (iii) D promised to put K in writing, but never did
Conviser seeks to enter into a written K "on behalf of Epstein" for (1) a one year lease, and (2) purchase of $500 of grits. Are these Ks enforceable?
(1) enforceable, but (2) is not absent WRITTEN PROOF OF AUTHORIZATION to K on behalf of Epstein.
RULES OF LAW REQUIRE the authorization be of "EQUAL DIGNITY" w the K if the K itself is within the SoF (i.e. if K must be written & signed, so must authorization).
LL agrees to modify T's 3 yr lease to a 1 yr lease. Does K law require a writing to prove the modification?
No, deal w alleged change not w/in SoF
LL agrees to modify T's lease from a 1 yr lease to a 3 yr lease. Does K law require a writing to prove the modification?
Yes, new agreement within SoF b/c term of years lease greater than 1 yr.
Provision in K between LL and T requires all modification be in writing. Effective?
At CL, K provisions requiring modifications be in writing are NOT EFFECTIVE.
Under UCC, such provisions EFFECTIVE UNLESS WAIVED.
Explain the Risk of Loss Analysis.
"ABC:" go down the ladder
Agreement - K terms control
Breach - breaching party L even if breach unrelated to the problem
CC Delivery: B bears risk of loss once S completes delivery obligations
Catch-all: If MERCHANT S, B bears upon B's RECEIPT; if nonmerch S, B bears upon S's TENDER
What is the implied warranty of merchantability? When does it arise?
When buying goods from MERCHANT* (i.e. deals in goods of kind sold), implied warranty that the goods are FIT FOR ORDINARY PURPOSES arises automatically.
What is the implied warranty of fitness for a particular purpose? When does it arise?
(i) B has a particular purpose; (ii) B relies on S to select suitable goods; (iii) S has reason to know of both B's purpose and B's reliance.
Guarantees that the goods are fit for B's particular purpose.
What is the effect of buying merchandise "as is" or "with all faults?"
IMPLIED WARRANTIES DISCLAIMED (i.e. merchantability and fitness, if applicable).
*N.b. does not disclaim express warranties!
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