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Offer – (1) Manifestation of Intent; (2) Stated in Certain & Definite Terms; Communicated to Specific Person(s); (4) Offeree Understands Contract on AcceptanceAcceptance – (1) Manifestation of Assent; (2) To Terms of Offer/Mirror Image; (3) Manner Invited or Required | UCC: Unless expressly stat...

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Offer – (1) Manifestation of Intent; (2) Stated in Certain & Definite Terms; Communicated to Specific Person(s); (4) Offeree Understands Contract on Acceptance

Acceptance – (1) Manifestation of Assent; (2) To Terms of Offer/Mirror Image; (3) Manner Invited or Required | UCC: Unless expressly stated, a reasonable manner of acceptance

Consideration – (1) Bargained for Exchange; (2) Legal Value – action or forbearance; (3) Promise Induced the Detriment and Vice Versa Failure of Consideration – (1) Gross Inadequacy; (2) Nominal/Sham Consideration (not option contracts) Limits of Consideration – (1) Illusory Promise (option to perform), exceptions: option contract, requirement contract (one party agreed to buy only from seller and seller supplies everything needed), output contract (seller agrees to sell everything to buyer and buyer buys everything); (2) Past Consideration; (3) Moral Obligation; (4) Preexisting Legal Duty (public & private); (5) Gratuitous Promises

Statute of Frauds: (1) Marriage, (2) Over-One-Year, (3) Land-Sale Contract, (4) Executory Payment of Estate Debts, (5) Sale of goods $500+, (6) Suretyship Agreement |SUFFICIENT MEMORANDUM: IDs subject matter; sufficient to show contract formed; states essential terms | Exceptions: Promissory Estoppel; Full Performance by Both Parties; Full Performance by One Party (over 1-year provision); Part Performance of Land-Sale (if reasonable reliance, must show evidence of oral contract, such as making improvements; $500+ (UCC): does not need to indicate buyer/seller, broad signature requirements (merchant may be held accountable w/o signature if it does not object to a written/signed confirmation memo delivered 10 days before, exceptions – specially manufactured goods Defenses/Excuses MINOR – Minor can void the contract at any time before he/she reached the age of majority or within reasonable time after age of majority; when minor voids, minor gets full consideration back and should attempt to return full consideration to other party; minor cannot void contract for necessities of life (ie. food, shelter)| MENTAL – mentally incompetent at contract formation (but if affirm contract when lucid contract is no longer voidable); NOT VOIDABLE WHEN: contract performed, other party unaware of mental incapacity; contract is on fair terms; MAJORITY TEST – Cognitive Test (did person have sufficient mental ability to reasonably understand the nature and consequences of transaction?); MINORITY TEST – Incapacity Volitional Test (lacks capacity if 1. Unable to act in reasonable manner in transaction, and 2. Other party know); Restoring Consideration – similar to minors but may have to account for depreciation of value of other party’s consideration | INTOXICATION – very high bar; cannot understand transaction and other party should have known they were so intoxicated When manifestation of assent is induced by either a fraudulent or material misrepresentation upon which the other party was justified in relying, the contract can be voided. FOUR ELEMENTS: (1) Misrepresentation – non-fraudulent/innocent mistake about a material element leading to mutual assent Objective Standard [reasonable person would likely be induced by the misrepresentation to enter the contract] and Subjective Standard [maker knows this recipient would likely be induced even if average person wouldn’t] (2) Fraudulent – intentional misrepresentation/fraud allows recipient to rescind contract based on fraud. Elements – 1. Knows or believes assertions are not factual; 2. Does not have confidence he Misrepresentation states or implies the truth/assertion; OR 3. Knows he does not have a basis that he states of or implies for the assertion. (3) Inducement – must have occurred at or before contract formation AND misrepresentation substantially contributes to party’s decision to enter contract (4) Justified Reliance – reasonable person standard; if receiving party should’ve known representation was false but was consciously ignorant then their reliance wasn’t justified (ie. “I’m selling an ocean front house in Nebraska”) No general duty to disclose all facts BUT an uninformed party may seek recission of a contract if non-disclosed facts (a) have a material effect on the transaction, (b) are not readily observable, (c) are not known to the non-disclosed party when (1) disclosure is required by statute, (2) a party intentionally conceals non-disclosed facts, (3) uninformed party is entitled to know facts due to relationship of trust and confidence between the parties, OR (4) to prevent/correct mistake of Nondisclosure uninformed party when non-disclosure breached duty of good faith Party’s manifestation of assent is induced by an improper threat that leaves party with no reasonable alternative but to accept, contract is voidable by victim. Inducement – substantial reason victim entered contract (doesn’t have to be only reason); looks subjectively at surrounding facts and circumstances. Improper Threat – (a) what is threated is a crime or tort or would be if it resulted in obtaining property; (b) criminal prosecution threatened, (c) bad faith threat of civil process, Duress OR (d) threat is breach of duty of good faith and fair dealing under a contract with recipient. | TYPES: Physical Duress (threat of physical violence can be enough; automatically void as a matter of public policy) Economic Duress (threat out economic pressure to enter agreement; voidable by victim at his option, not automatic) RULE – (1) unfair persuasion of a party who is under the domination of the person exercising the persuasion or who by virtue of the relationship between them is justified in assuming the person will not act in a manner inconsistent with their welfare. (2) if a party’s manifestation of assent is induced by the indue influence of another party, the contract is voidable by the victim | Ex) someone in a position of trust and/or taking advantage of weakness of mind | ELEMENTS: Inducement Undue Influence – substantial reason the victim entered into the contract; victim entered into the contract; Unfair Persuasion – when intimidation or coercion crosses the line, typically playing up another’s “mental, physical, or emotional weakness”; Undue Susceptibility – Weakness of Mind (doesn’t need to be mental incapacity, ie. isolated people), Relationship of Trust (spouses, patient-doctor, child-guardian/parent, fiduciary advisor, etc. [not necessary, just often there], SLIDING SCALE – the two should add up to 100%; Inequitable Result – outcome must be unfair, but a bad bargain/adequacy of consideration is not enough Must be (on a SLIDING SCALE) [1] Procedural Unconscionability – gross inequality or bargaining power (lacks a meaningful choice, take-it-or-leave-it/adhesion contracts) OR unfair surprise (Lack of Actual Knowledge of Terms – typically a mental Unconscionability defense but not as high a bar, ie. young/old age, lack of education; Sharp Bargaining Practices – dishonest & misleading; Complex & Hidden Terms in Complicated Document – made more complex than needed AND [2] Substantive Unconscionability – Overly Harsh Allocation of Risks (disclaimer of intentional torts & gross negligence liability, mandatory arbitration clauses), OR Great Price Disparity (but inadequacy of consideration is not alone enough; 10-12x price disparity) Mistake about a basic assumption AT contract formation that has a material effect on the exchange (so severe the party must show he cannot fairly be required to carry it out); Basic Assumption cannot be market assumptions (ie. this will be profitable, market will go up, etc) | Bears the Risk – (a) allocated by agreement, (b) conscious ignorance, (c) allocated by the court | Mutual Mistake – (1) Mistake (2) about a Basic Assumption (3) that has a Material Effect (4) which allows the Mistake party to void the contract unless he Bears the Risk | Unilateral Mistake – 1) Mistake (2) about a Basic Assumption (3) that has a Material Effect (4) the party does Not Bear the Risk, (5) AND there is (a) unconscionability – typically substantive OR (b) Knowledge of or Fault in Causing Mistake – palpable mistake = egregious mistake the other party should have known of Impossibility – (1) After Contract Formation; (2) Supervening Cause Without Fault (ie. Clean Hands Doctrine); (3) Impossibility of Performance (objective); (4) Basic Assumption the Event Would not Occur (does not include profit assumptions); (5) Allocation of the Risk (party cannot have borne the risk via. 1. Agreement [ex. Force Majeure Clause – clause must describe a. external forces outside the control of both parties, b. are not reasonably foreseeable, and c. material affect the duties of the parties (ie. acts of god)] ; 2. Should have known of the risk; 3. Court allocation) | Impracticability – (1) After Contract Formation; (2) Supervening Event Occurs Without Fault; (3) Impracticability of Performance (ie. extreme and Changed unreasonable expense, injury, or loss; party should have made reasonable attempts to surmount obstacles to performance; Generally a 10-12x loss if forced to follow through); (4) Basic Assumption the Defense Would not Occur; (5) Allocation of the Risk | Frustration of Purpose – (1) After Contract Formation; (2) Supervening Event Occurs Without Fault; (3) Frustration of Purpose (makes no sense to continue based on the changed circumstance; performance is neither difficult nor Circumstance impossible to perform but is meaningless; performance of the contract is substantially frustrated as to make performance of one party worthless to the other party); (4) Basic Assumption Defense Would not Occur; (5) Allocation of the Risk | SCENARIOS – Destruction of a Thing: destruction makes performance impossible (ie. if one car is destroyed you can get another; Death/Incapacity of Person: only if only that person can perform (ie. special personal service); if person can be replaced it’s not impossible, but may be impracticable; Government Action: Something may be legal when contract is formed and then government action makes it illegal/impossible to perform Parol Evidence Rule – (1) two parties enter into a contract with a writing, (2) one party asserts the writing contains ALL terms, (3) ither party asserts there were additional oral (or other written) terms, (4) judge must decide what is admissible. | Jurisdictional Approaches: Modern Rule (Majority) – surrounding facts and circumstances can be considered to determine if writing is fully integrated. Merger Clause creates a string presumption document is integrated, but the detail, nature, and type of writing, and relationship of the parties can impact the merger clause’s effect. Classic Rule (Minority) – 4 Corners Rule, if writing appears to be complete and unambiguous on its face, the meaning can only be determined through the words in the document, not outside evidence. Merger Clause is dispositive. | EXCEPTIONS – Parol Evidence Rule does NOT bar introduction of (1) evidence offered to interpret an ambiguous term; (2) subsequent agreements (oral and written, (3) showing fraud, mistake, duress, undue influence, or other voidability; (4) collateral agreements with separate consideration (related contract with separate consideration and independent meaning, but terms cannot conflict with the primary agreement); (5) condition precedent to the formation of a contract (when a contract is fully integrated but has a condition for contract to be effective, parol evidence allowed to prove the event occurred/didn’t occur) |UCC Parol/Extrinsic Evidence Rule – confirmatory memos and other writings which parties agree are final expressions may NOT be contradicted by outside evidence BUT may be explained or supplemented by (a) course of dealing or usage of trade or by course of performance; OR (b) by evidence of consistent additional terms unless the court finds the writing was intended as a complete & exclusive statement of agreement Full Integration Partial Integration No Integration Intended to be complete & final embodiment of terms; has all essential terms; has Omits an agreed-on term that is consistent with the agreement merger clause Consistent Additional Terms (ie. supplemental) – Not Admissible Consistent Additional Terms (ie. supplemental) – Admissible Consistent Additional Terms (ie. supplemental) – Admissible Contradictory Terms – Not Admissible Contradictory Terms – Not Admissible Contradictory Terms – Admissible Interpreting Ambiguous Terms – Ambiguity exists if meaning of term is uncertain OR term is reasonably susceptible to different meanings (Reasonable Susceptibility Test – if interpretation is absurd or beyond what a court deems reasonable, the court will find there is no ambiguity and enforce the contract as written). Modern Jurisdiction – considers extrinsic evidence to determine if there is ambiguity; can find both patent & latent ambiguities | Classic Jurisdiction – ambiguity must exist within the four corners for the document, only considers patent ambiguities. FIRST – Apply Primary Rules (1) Express Terms [plain meaning, technical meaning, context]; (2) Course of Performance [performance within the context of the agreement]; (3) Course of Dealing [past dealings]; (4) Trade Usage [customary practices or meanings]. SECOND – Apply Secondary Rules (1) Cannons of Construction [ “agreement must be read as a whole…”; “no presumed exceptions…” etc.]; (2) Interpret as Lawful, Valid, & Reasonable; (3) Ejusdem Generis [when a specific word/term is followed by a general word/term, the general word/term should be applied only to the more specific word/term mentioned]; (4) Interpretation Against the Drafter [if drafter includes ambiguous term, interpret in least favorable way for the drafter] Intent – (1) Ordinary Meaning – objective & ordinary meaning of the words (2) Technical Meaning – technical terms & words of art are given technical meanings (3) Surrounding Circumstances – everything interpreted in light of the surrounding circumstances Implied Terms – Common Law: terms that are reasonable under the circumstances may be implied (look at language in contract; context; course of performance; trade usage; course of dealing) UCC GAP FILLERS – default terms a court may supply if they are not included in a contract; Implying Reasonable Price Provisions – imply a reasonable price at the time of delivery; Implying Reasonable Time Provisions – imply a reasonable time for shipment or delivery | Implied Obligation of Good Faith & Fair Dealing – always a duty of good faith and fair dealing, cannot try to avoid the spirit of the bargain. A party cannot reject performance just because the presence of a Satisfaction Clause (instead use reasonable person standard, UNLESS it relates to aesthetics where subjective tastes matter

BREACH OF CONTRACT: Partial Breach – minor; injured party received substantial benefit/breaching party substantially performed; injured party must still perform and cannot terminate contract but has can seek damages Material Breach – party has not substantially performed; injured party can suspend performance while waiting breach to be cured; if uncured, breach becomes total (must cure in reasonable time; include time is of the essence clause to maybe not allow for cure and immediately total breach) Total Breach – not cured material breach because breaching party was unable or unwilling to cure; injured party can terminate contract, withhold performance, and recover damages | Assessing Materiality of Breach: Amount of Benefit Not Received; Adequacy of Damages; Forefeiture Suffered by Breaching Party; Likelihood of Cure; Lack of Good Faith & Fair Dealing | UCC Nonperformance: Seller’s Nonperformance – Non-delivery; Breach of Warranty (accepting removes buyer’s right to terminate; can receive difference in value between received and waranteed goods); Anticipatory Repudiation; Failure to Make Perfect Tender (seller must perform exactly or buyer can (a) reject in whole (b) accept in whole (c) accept in part & reject in part; buyer cannot accept goods and then reject UNLESS there is a substantial non-conformity; buyer must reject in a reasonable time; Installment Contract Exception – can only reject one installment not full contract unless the installment is essential to contract’s value) Conditions to Performance: Conditions must be outside the control of the party whose duty is triggered/terminated by the event (ie. weather; 3rd party). Event must occur exactly, not just substantial. Condition Precedent – event that must take place before a party to a contract must perform; Conditions Subsequent – Event that terminates the duty of a party to perform. TYPES: Express Conditions; Implied Conditions; Constructive Conditions | EXCUSES: Express Waiver; Estoppel (if one party promises to waive a condition and the other party relies on it, promissory estoppel if that party goes back on promise); Wrongful hindrance by party with duty to perform; avoidance of disproportionate forfeiture Anticipatory Repudiation: Before performance was due, unequivocal and definite statement; Non-Repudiating party may – (1) suspend performance, (2) terminate and sue for breach, (3) treat contract as valid and wait until time of performance to sue; repudiating party can retract repudiation but right is terminated when non-repudiating party (1) notifies contract is rescinded/terminated, (2) sues for breach, (3) materially changes position in reliance of the repudiation, with or without notice. REQUEST FOR ADEQUATE ASSURANCE: UCC – allows for request and gives 30 days to respond or treated as repudiation; Common Law – allowed if there are reasonable grounds for insecurity (ie. supply shortage, labor strike, financial struggles) then a reasonable time given to respond REMEDIES: All damages limited by principles of certainty (ie. not speculative), causation, foreseeability, and mitigation. EXPECTATION INTEREST: Measure of General Damages (stem from contract); Consequential Damages (arise as consequence of breach; ie. collateral contracts, loss of use damages, fines from government); Incidental Damages (reasonable mitigation costs) | RELIANCE INTEREST: reimburses foreseeable expenses made in reliance of the contract (less any losses party would incur from contract); common in promissory estoppel cases. Essential Reliance (costs incurred in preparation for/performance of contract, inherently foreseeable); Incidental Reliance (costs incurred entering into collateral contracts on reasonable reliance of the contract; requires more proof of foreseeability) | RESTITUTION INTEREST: Must be total breach/repudiation; not available if non-breaching party fully performed or only remaining duty of breaching party is to pay contract price. Money or Market Value Restitution – calculates the fair market value of property/services P conferred on D.Specific Restitution – transfers title back to non-breaching party. RESTITUTION FOR BREACHING PARTY: can recover anything in excess of the loss caused by the breach; gets lesser of fair market value or actual expenses paid. | MITIGATION (aka Avoidable Consequences Doctrine): must make reasonable efforts to mitigate loss or damages may be reduced to factor in lack of mitigation. Reasonable effort (does not need to be successful); no need to incur humiliation, injury, dishonor, etc. LOST VOLUME SELLER – 3 Prong Test: (1) person who bought the resold entity would have been solicited by P had there been no breach; (2) solicitation would have been successful; (3) P could have performed the additional contract. (“has capacity to…”; “can deliver…”) – P gets full recovery.SPECIFIC PERFORMANCE: May be ordered when (1) money damages are inadequate [speculative; D insolvent; unique property at stake]; (2) certain and definite contract terms; (3) feasible for court to supervise. | Reasons to Deny – (1) Breaching party mistake; (2) breaching party would face unreasonable hardship; (3) would violate public policy | Unclean Hands | LACHES; when injured party delays bringing claim that causes prejudice against breaching party | Land-Sale Contracts (buyer – commonly granted because property is unique and hard to value; seller – granted when money damages inadequate, no other seller, value hard to determine); Personal Performance Contracts (rare due to indentured servitude); UCC – granted for buyer if goods are unique (COVER DAMAGE...