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Contracts/:Applicable Law: Terms

UCC: governs contracts for the purchase and sale of goods. A good is a thing that is moveable at the time of identification to the Parol Evidence Rule: Evidence of any prior agreement, or contemporaneous oral agreement, is inadmissible to vary
contract. the terms of the contract if the written contract is integrated; that is, intended as a complete and final expression of
Merchants: Some UCC provisions apply uniquely to merchants. A merchant is one who deals in the goods, or otherwise has the parties. Exceptions:
specialized knowledge of the goods, that are involved in the transaction. CL Fraud/False Misrep Allowed to vary terms if fraud
Common Law: Majority of rules governing contracts other than sale of goods. Formation Defect Allowed if defect due to fraud, duress, mistake
Mixed Contracts: Governed by the more important part of the deal, except divided contracts in which both UCC and common law Condition Precedent Admissible to prove existence of condition precedent
rules apply. Predominant Factor test vs. Gravamen of Injury. Collateral Agreement May not be protected by parol evidence
Types of K: Unilateral: Expressly requires performance for acceptance (i.e. reward) Subsequent Agreement By definition, an agmt after integrated K is formed
Bilateral: results from offer open as method of acceptance does not fall w/in reach of parol evidence rule
Option: Agreement to leave open in exchange for consideration. Ambiguity Allowed to explain ambiguity
Quasi-K: Equitable remedy when K results unfair. Prevents unjust enrichment UCC C/L Exceptions
Formation: Offer: (1) A manifestation of a present intent to contract demonstrated by a promise, undertaking or commitment (2) Course Dealings Same ppl, similar K
definite and certain terms (3) communicated to an identified offeree. Course of Performance Same ppl, same K
Content: Sales=price&description; UCC=quantity; Reqt K=terms of exclusivity; real estate=identification of land&price; Trade Usage Diff ppl, similar K
employment=duration. UCC Warranties:
Termination of Offer: Express/ basis of bargain: Breached if product not as represented.
Revocation: an unambiguous statement by offeror to offeree, unambiguous conduct indicating unwillingness to K that offeree is Implied: Merchantability, fit for a partic.purpose. (1) S has reason to know of buyers needs,(2) B relies (3) damages.
aware of. An offer is freely revocable unless: Third Party Rights
Option K: An offer may not be revocable if consideration was paid for the option to hold the offer open. Third Party Beneficiary: A third party beneficiary is one whom the promisee of the contract intended to benefit.
Detrimental Reliance: Incidential TPB dont have K rights, only TPB do. No cancellation or modification after TPB rts have vested either by
Start of Part Performance: Part performance of a unilateral contract creates an option contract. Full performance would constitute relying, assenting, or suing for enforcement.
acceptance. In either case, the offer could no longer be revoked. Assignment of Rights: An assignment is a present transfer of one's rights under a contract, and is generally valid
UCC Firm Offer: no revoke for up to 3 mo if offer to buy/sell goods, signed, in writing, by merchant, states will be held open. without consideration. (1) present transfer of an existing K right (2) assent by assignee (3) doesnt materially alter
Rejection by Offeree: counter offer kills; addl terms under C/L mirror image rule; lapse of time, e.g, > 1 mo; conditional acceptance obligors RISK or DUTY, (4) not too personal, (5) not against public policy.
kills. Delegation of Duties: A delegation is a transfer of one's duties under a contract, and is generally valid without
Operation of Law: consideration. Allowed unless K prohibits, K calls for special skills, or K has special reputation. If 3 rd party doesnt
Acceptance: Unconditional assent to be bound by the offer perform, delegating party always remains liable.
C/L: Mirror Image rule: Acceptance must match offer terms Conditions: event that must be excused or satisfied before a duty to perform becomes absolute
Full Performance or Start Performance (for bi-lateral K, not for unilateral K) Distinction: Implied by law=interest of justice, Express=placed by parties, strictly enforced
Mailbox Rule: Effective when mailed, all else when received Types: Precedent=before, concurrent=trigged when one party willing+ready+able to perform,
Seller of Goods Sends Wrong Goods: Unless w/ explanation (then its a counter offer) subsequent=extinguishes an absoluted duty to perform
Offeree Promise to Perform: Condition v. Promise: failure to perform condition can discharge other party duty entirely. Failure to perform
Additional Terms: UCC one party merchant Addtl term is proposal subject to rejection; promise does not discharge other partys duty - merely puts in breach and allows him to sue for damages.
both party merchants addtl terms part of K unless materially alters, offeror objects w/in reasonable time, or offer limits acceptance Excuse of condition: Non-occurrence of a cond. may be completely excused, triggering performance in other party.
to terms. Conduct Causing Breach
Consideration: Present when there is a (1) bargained for exchange in which there is a(2) legal detriment. A legal detriment is Anticipatory Repudiation: definite and unequivocal statement that a party intends not to perform. However, under
giving up something of value. the UCC when reasonable grounds for insecurity arise with respect to performance, the other party may in writing
Past Consideration: Not consideration, except expressly requested performance/forbearance and expectation of payment. New demand assurances. After receipt of a justified demand, failure to provide assurances within a reasonable time (not
consideration reqd for pre-existing K or statutory duty. to exceed 30 days) constitutes a repudiation of the contract.
Substitutes: Written promise when prior obligation had applicable legal defense; promissory estoppel Wrongful Prevention: anticipatory repudiation by conduct, where a party prevents the occurrence of a condition
Requirements/Output K: consideration is found in the assumption that the parties will act in good faith Performance
Defenses: Performance Satisfied: C/L: (1) complete, (2) substantial got what bargained for- can be reimbursed for what did
To Formation: To Capacity: To Enforcement: not receive finding of no performance would pose great hardship deviation was not willful.
Lack of Offer/Acceptance/Consideration Legal Age: if <18 Illegality UCC: Perfect Tender Rule: must be perfect, except: (1) Time not yet expired and can cure, (2) installment K
Mutual mistake: as to material issue K voidable Statute of Frauds: signed by both, identify parties, subject reject where imparement (3) seller had reasonable grounds to believe tender conformed.
voidable by either party matter, and consideration If tender not perfect: accept, reject, or accept part and reject part.
Unilateral Mistake usually not defense Mental: if Exceptions Discharge of Performance:
unless creates unconscionable situation adjudged - C/L: (1) sufficient memo (2) part performance. (3) Estoppel By Subsequent Event
Misrepresentation = voidable incompentent reasonable and foreseeable detrimental reliance Impossibility: an event unforeseen by either party that makes performance objectively impossible
Fraud: in execution = Void, in inducement = void -UCC: (1) written confirmation btwn merchants; (2) specially Impracticability: cant be done w/o extreme and unreasonable difficulty or expense. Increase in cost rarely excuse
voidable by defrauded manufactured goods; (3) admissions: (4) part performance/good Frustration of Purpose: unforeseeable supervening event destroys purpose of K
Duress: must by physical not economic Being drunk will received or paid for; (5) Estoppel. Condition subsequent: will discharge performance sometime subsequent to the formation of the contract
Ambiguity: if subject to more than one only render K Oral Recissions: C/L ok if mutual consent. UCC. Non oral clauses
UCC: When reasonable grounds: other party may in writing demand adequate assurance of performance (and
meaning no K unless both parties intended voidable if other usually upheld, unless on party relied.
suspend his/her own performance). Failure to provide assurance within reasonable time (not to exceed 30 days)
same meaning, or if one party knows of party had reason Unconscionability: not be enforced where there is one-sidedness
ambiguity and other does not. to know of the in favor of the stronger party
after receipt of a justified demand constitutes a repudiation of the contract.
intoxication Public Policy: By: New Agreement
Post Formation Issues: Modification: C/L new consideration. UCC: Good faith w/o consideration
Modification Accord and satisfaction: An accord is a new agreement intended as a compromise to settle and discharge a
genuine dispute, which once accepted must be satisfied, else the aggrieved party may sue under the accord or
CL: Void absent new or additional UCC: No consideration needed as Oral Mod: Within SOF is invalid unless material
under the original contract, if there was one that was formed
consideration long as made in good faith. reliance
Novation: A novation is an entirely new agmt, usually to substitute parties, where all must agree for it to be valid
Alternative Theories of Recovery if no Contract is Formed:
Breach- A breach is an unjustified failure to perform an absolute duty
Promissory Estoppel: Unjust Enrichment: Unjust enrichment is Accord and Satisfaction: accord is agmt where parties
Major Breach: deprives the non-breaching party of the substantial benefit of his bargain, and one which excuses the
promise, reliance, improper acquisition of a benefit that is not compromise to discharge and settle a genuine
non-breaching party's counter-performance and allows a right to damages
necessary to avoid equitable or just. D enriched at Ps expense, dispute. (1) Offer (2) acceptance(3) genuine
Minor Breach: non-breaching party gets the substantial basis of his or her bargain and so must continue
injustice. would be unjust to let D retain benefit. dispute.
performance, but can sue for damages
Remedies:
General Damages: Damages must be caused by the breach, foreseeable, certain, and unavoidable. Expectation - puts P as if K wasnt
breached. Or UCC using seller/buyer calculation.
Consequential Damages: (those, other than expectation, that flow from the breach), they must be reasonably foreseeable, or
specifically brought to the attention of the defendant, at the time the contract was formed
Liquidated Damages: K fixes amt of damages. Valid if damages difficult to ascertain and reasonable forecast.
Punitive Damages: Punitive damages are generally not awarded in contract cases. Except bad faith employment or insurance cases
Reliance Damages: detrimental reliance damages make the plaintiff whole as if there never was any contract.
Restitution: applies where there has been an unjust enrichment, measured by the benefit conferred
Specific Performance: typically limited to real estate, sale of unique goods, but never for services. Reqts: inadequacy of legal remedies,
definite and certain terms, mutuality, feasibility of enforcement. Defenses: unclean hands, laches, hardship, material misrep,
unconscionability, SoF.
UCC Replevin: buyer entitled to immediate recovery of actual goods if: goods identified and buyer cannot cover after reasonable
efforts..
Rescission: Cancels K. Mistake, misrepresentation, fraud.
Reformation: Changes written agreement to conform to parties original understanding. Reqt: valid K, ground for reformation. No
negligence, SoF, PER.
Reclamation: Right of unpaid seller to get goods back. Only if Buyer was insolvent at time of receipt and seller makes demand for return
w/in 10 days of buyers receipt of reasonable time if buyer gives express representation; and buyer has goods at time of demand.
Injunction:
TRO: Used to prevent immediate harm.
Prelim injunction: Used to maintain status quo after showing likely to succeed on merits and posting bond
Permanent Injunction: Issued after a decision on the merits to prevent the defendant from acting in a certain manner

Fixtures
A fixture is a good that has become so affixed to realty that it becomes a part of the realty, and a chattel interest may become subordinate to a real
property interest unless it is protected by Article 9.

Proper Filing: A proper filing gives goods priority over competing real property interests if each of the following
Identity and Address of Debtor and Creditor
Identity of Collateral
Signature of Debtor
Priority Rule: A perfected security interest in fixtures has priority over conflicting interests if each of the following
Purchase Money Security Interest
Perfected by Filing
Filing Before Goods Become Fixture or Within 20 Days
Debtor Has Recorded Interest or Possession of Realty