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Creation of an enforceable contract requires mutual consent, consideration and no defense to


formation. Bilateral contract requires an exchange of promises. Unilateral contract requires an
exchange of an act for a promise. UCC governs the contract if the contract involves the sale of goods.

2. The parties must form an agreement by consenting to the same terms at the same time. They
accomplish this by the process of offer and acceptance. All offers contain three elements:(1) an
expression of intent to enter a present contract; (2) a sufficient articulation of the essential terms of the
proposed bargain; (3) communication to the offeree who is entitled the capacity to form a contract by a
timely and conforming acceptance.

3. (1)The common law insist that an offer express the "essential terms," including an identification of
the parties, a description of the subject matter, the price and the time for performance.
(2)Under the UCC, the quantity is the only essential term. A contract which measures the quantity by
the output of the seller or the requirements of the buyer is valid if the actual output or requirements
occur in good faith and reasonable. It is invalid if unreasonably disproportionate to any stated estimate
or to any normal or comparable prior output or requirement.
(3)UCC "open price" term. The failure to state the price does not prevent the formation of a contract if
the parties intended to leave the price to be agreed upon in the future. If the price term is missing, the
court will interpret their mutual silence as consent to trade at a commercially reasonable price.

4. The offeree can accept the offer before it has expired either by its own terms, by operation of law, or
by act of the parties. The offeror can revoke her offer prior to an effective acceptance. But the offer are
not revocable under the three circumstances.
(1) "Option contract": If the offer is in writing, signed by the offeror and states that offer is irrevocable,
offeror cannot revoke the offer. Rejection of option before end the option period does not terminate the
power to accept the offer, unless the offeror detrimentally relies upon the rejection. (NY statute)
(2) “Firm offer rule”: under UCC, an offer by a merchant to buy or sell goods in a signed writing,
which by its terms gives assurance that it will be held open is not revocable, for lack of consideration.
(3) Detrimental reliance: a offer cannot be revoked if there has been detrimental reliance by the offeree
that is reasonably foreseeable.

5.(1)Under Common Law, acceptance that adds additional terms is treated like a counteroffer rather
than an acceptance and no K is formed-“Mirror Image Rule”. BUT, if the other party has acted to
indicate acceptance, there’s an implied K.
(2)Under UCC, a definite and reasonable expression of acceptance or a written confirmation operates
as an acceptance even though it states additional or different terms, unless acceptance is expressly
made conditional on assent to the additional or different terms.
Between merchants, such terms becomes part of the contract unless:i) the offer expressly limits
acceptance to the terms of the offer; ii) they materially alter it; or iii) notification of objection given w/
a reasonable time by offeror.

6. "preexisting legal duty rule"


Under common law, performing or promising to perform an existing legal duty is insufficient
consideration. In NY, a written modification satisfies consideration. UCC does not follow pre-existing
duty rule. An agreement modifying a contract needs no consideration to be binding. The requirement of
the Statute of Frauds must be satisfied if the contract as modified is w/ its provisions.

7. Parol evidence rule: the confirmatory memoranda or writing as a final expression of their agreement
intended by the parties. may not be contradicted by evidence of any prior agreement or of a
contemporaneous oral agreement but may be explained or supplemented

(a) by course of dealing or usage of trade (Section 1-205) or by course of performance (Section 2-208);
and
(b) by evidence of consistent additional terms unless the court finds the writing to have been intended
also as a complete and exclusive statement of the terms of the agreement .