Offer + Acceptance = Mutual Assent Offer Acceptance Mutual Assent + Consideration = Contract Requirements: Common Law 1. INTENT TO BE BOUND MIRROR IMAGE RULE Consideration Defenses 2. TO DEFINITE TERMS UCC Acceptance to Formation 3. COMM. TO OFFEREE ADD. & DIFFERENT TERMS Benefit or Detriment Bargained-for Exchange STATUTE OF FRAUDS Termination: Methods MISTAKE (MUTUAL ADEQUACY IRRELEVANT PROMISE; PERFORMANCE OR UNILATERAL) 1. LAPSE OF TIME NO PAST CONSID. PRE-EXISTING DUTY AMBIGUITY 2. REVOCATION Modes ILLUSORY PROMISES ILLEGALITY 3. REJECTION (includes AUTHORIZED OR REAS. INCAPACITY COUNTEROFFER) Promissory Estoppel 4. OPERATION OF LAW Mailbox Rule UNCONSCIONABLE Consideration Substitute EFFECTIVE AT DISPATCH FRAUD, DURESS
Step Two: Performance
Contract Terms Excuse of Condition Discharge of Duty WRONGFUL PREVENTION BY PERFORMANCE Interpretation & Construction VOLUNTARY DISABLEMENT IMPOSSIBILITY, ETC. CUSTOM & USAGE, COURSE OF DEALING ANTICIPATORY REPUDIATION MODIFICATION Parol Evidence Rule ACTUAL MATERIAL BREACH MUTUAL RESCISSION IF K CLEAR AND UNAMBIG., NO EVID. WAIVER & ESTOPPEL NOVATION OR SUBST. K OF PRIOR OR CONTEMP. AGREEMENTS IMPOSSIBILITY, ETC. ACCORD & SATISFACTION SUBSTANTIAL PERFORMANCE LAPSE, STATUTE OF LIMIT. Modification C/L: CONSID. REQ. UCC: GOOD FAITH OK MAY NEED TO SATISFY SOF Breach Third Parties Breach = Failure to Discharge an Absolute Duty
Third Party Beneficiaries Material Breach vs. Substantial Performance
INCIDENTAL or INTENDED; DONEE or CREDITOR FACTORS: BENEFIT RECEIVED, ADEQUACY OF DAMAGES, EXTENT OF PARTIAL PERFORMANCE, HARDSHIP TO Assignment, Delegation, Novation BREACHING PARTY, NEGLIGENCE OR WILLFULNESS
Step Three: Remedies
Damages for Breach Restitution Rescission UNJUST ENRICHMENT OF DEF. Compensatory Damages EQUITABLE REMEDY QUASI-CONTRACT = NO REAL K COURT ORDERS K CANCELED BENEFIT OF BARGAIN; MUST BE CERTAIN MAY GO TO PARTY IN BREACH GROUNDS: MISTAKE, MISREP. EXPECT. MEASR.; RELIANCE IF UNCERTAIN EQUITABLE DEFENSES APPLY Consequential Damages MUST BE REAS. FORESEEABLE AT TIME OF K Specific Reformation Liquidated, Incidental & Nominal Performance EQUITABLE REMEDY BUT NO PUNITIVE UNLESS NON-ECON. COURT ORDERS K MODIFIED EQUITABLE REMEDY Defendant's Duty to Mitigate REMEDY @ LAW INADEQUATE GROUNDS: MISTAKE, MISREP. REAL PROPERTY IS UNIQUE EQUITABLE DEFENSES APPLY APPLIES TO ALL CONTRACTS