Contracts

Strict Performance Standard

Requires full or perfect compliance with the contract terms.

Value/Opinion/Sales Talk (Warranty)

Statements of value or opinion do not express warranty; same is true for sales talk/puffery.

Conditions

-A promisor's duty is subject to an occurrence or event happening in the future; unconditional or absolute. Classified by: →How the condition was created. →Effect of the condition on the duty to perform. -Condition Precedent: A future, uncertain event creating a duty to perform. -Condition Concurrent: When a contract calls for parties to perform at the same time. -Condition Subsequent: A future, uncertain event that discharges the duty to perform.

Agreements that Violate Public Policy (4)

-Agreements that commit a crime. -Agreements to promote an illegal purpose. -Agreements to perform an act for which the person is not properly licensed. -Agreements in restraint of competition.

Bilateral vs. Unilateral Contract

-Bilateral: Both parties make a promise, contract formed when promises are exchanged (immediately). -Unilateral: Only one party makes a promise, contract formed when promise completed (action), promise for an action.

Definiteness in Terms (Common Law vs. UCC)

-Common Law: Must state definitely and specifically what the offeror is willing to do and what he asks in return for his performance. More modern interpretations of common law are becoming more flexible. →An objective willingness/intent to contract. →Courts need to know terms on which the parties agreed so that the court can calculate a remedy if a breach occurs. -UCC: Often creates a contractual liability where no contract would result under common law. "In any manner sufficient to show agreement, including conduct."

Contract Remedies

-Damages: →Compensatory Damages: For the particular loss, detriment, or injury suffered as a result of the unlawful conduct of another. →Consequential (Special) Damages: Can be proven to have occurred because of the failure of one party to meet a contractual obligation. →Nominal Damages: Usually for technical breach and no economic loss. →Liquidated (Contractual) Damages: Parties expressly provide for damages in case of breach courts enforce only if reasonable, can't be penalty. →Punitive Damages: For behavior. *Party can recover provable damages, foreseeable losses. -Equitable Remedies Remedies: →Restitution: Compensation. →Specific Performance: Only when there is no adequate remedy at law (equitable). →Injunction: Require to do something or refrain from doing something (equitable).

Executory vs. Executed Contract

-Executory: Contract "executory" until contractual obligations are fulfilled. -Executed: Contract duties fulfilled, contract no longer in effect.

Express vs.Implied Contract

-Express: Agreement of parties manifested by words, written or oral. -Implied: Agreement of parties shown by acts or conducts.

Preexisting Duty & Modifications (Common Law vs. UCC)

-If a creditor's promise to discharge a liquidated debt for part of payment of the debt at or after its due date is unenforceable for lack of consideration. -If there is a dispute about the existence/amount of debt, it is unliquidated. Settlement agreements are enforceable. -Promises made to satisfy a preexisting moral obligation are unenforceable.

Illusionary Promises

-If a promisee's promise really does not bind the promise to do so or refrain from doing anything, then the promise is illusory and cannot serve as consideration. -Lacks mutuality of obligation.

Other Reasons for Discharge

-Illness or Death of Promisor: Real estate conveys, personal services excused. -Supervening Illegality: Makes action illegal, makes action more difficult. -Destruction of Subject Matter: Key = before delivery. -Commercial Impracticability: Without fault of promisor, contract made with assumption event would not occur (rare). -Impossibility: A contract is made impossible to carry out. -Alteration: One party alters contract and the other does not consent. -Statue of Limitations: Party takes too long to bring lawsuit (4 years). -Bankruptcy: Financially impossible.

Communicating Acceptance

-Instantaneous Communication: Happens immediately. -Non-instantaneous Communication: Mailbox rule.

Offeror & Offeree

-Offeror: Creates offer. -Offeree: Accepts offer.

Exceptions to Consideration (3)

-Promissory Estoppel: Is now widely used as a consideration substitute, not only in donative promise cases, but also in cases involving commercial promises contemplating a bargained-for-exchange. -State Statutes: That extend promises to pay debts that have been barred by statue of limitation/bankruptcy. -Charitable Subscriptions: Like promissory estoppel.

Termination Clauses

-The unilateral right to cancel or terminate agreement can sometimes operate to render the agreement an illusory one. -If the party binds himself to do something in exchange, the promise is not illusory.

UCC Contract Law

-UCC: Statutory law in every state and contains 9 articles. Created to establish a uniform set of rules to govern commercial transactions which are more often conducted across state lines; only applies to merchants. -Article 2: Expressly applies contracts for the sale of goods (tangible, movable, personal property). →More flexible than common law. →Distinguishes from merchants & non-merchants. →All transactions must be in "good faith" and cannot be "unconscionable".

Consideration Legal Value

-Unilateral: Consideration can be an act. -Bilateral: Consideration is a promise. Legal value created: →The promise agrees to something they had no legal duty to do before. OR →The promise refrains from doing something she has a legal right to do. *Monetary/economic value not required & promisor isn't required to receive benefit.

Untrue Assertion of Fact Types (3)

-Untrue Assertion: One of the parties must have made an untrue assertion of fact or engaged in some conduct that is the equivalent of the untrue assertion of fact; the fact asserted must be a past or existing fact (vs. a prediction, opinion, or promise). -Concealment: Conduct intended to prevent the other party from discovering the fact (equivalent to assertion). -Nondisclosure: Knowingly withholding of information, intelligence , property, with the knowledge that the information, intelligence, property, is required or could be useful in the full investigation or scrutiny by a lawful body or court (equivalent to assertion).

Void vs. Voidable Contract

-Voidable: Harmed party has a legal right to cancel their obligations under the contract (misrepresentation, fraud, mistake, duress, or undue influence). -Void: One that doesn't meet all legal requirements to be a legal contract.

Express Warranty Types (3)

1) If affirmation (declaring true) of fact or promise regarding the goods becomes party of the basis of the bargain, there is an express warranty that the goods will conform to the affirmation or promise. 2) Any description of the goods that becomes part of the basis of the bargain creates an express warrant that the goods will conform to the description. →Statements about brand, type, model; adjectives to describe product; drawings, blueprints, technical specifications. 3) Assuming it becomes part of the basis of the bargain, a sample or model of goods to be sold creates an express warranty that the goods will conform to the sample/model. *When goods not as warranted, the plaintiff is entitled to compensatory damages. *When there are multiple express warranties, they should be read and consistent and cumulative if reasonable. →If not reasonable: tech specifications > sample/model/ > descriptive language.

Other Terminations (Offer)

1) Lapse of Time: Depends on circumstances and context. 2) Rejection: Outright or by counteroffer when actually revived by offeror. 3) Death or Insanity: Automatic termination. 4) Destruction of Subject Matter: Terminates if without fault or knowledge of either party. 5) Intervening Illegality: Offer terminated if performance of contract becomes illegal before the offer is accepted.

Acceptance Rules (3)

1) Only offeree may accept offer. 2) If offer calls for performance, then performance is acceptance (unilateral). 3) Offeror may specify manner of acceptance.

Revocation Exceptions (4)

1) Option Contract: Offerror agrees not to revoke contract for a stated time in exchange for some valuable consideration. 2) Offers for unilateral contracts. 3) Promissory estoppel circumstances. 4) Firm offers for sale of goods.

Mistake & Elements (3)

A belief about a fact that is not in accord with the truth. If the parties make assumptions as to the value of the subject matter, that will likely not void the contract. Elements (To Avoid Contract): 1) Mistake relates to the basic assumption on which the contract was made. 2) Mistake has a material effect on the agreed upon exchange. 3) Party adversely affected by the mistake did not bear the risk of the mistake. *Mistake cannot be due to the other party's statement.

Disclaimer

A clause in the sales contract whereby the seller attempts to eliminate liability it might otherwise have under the theories of recovery.

Licensing Statues

A common regulatory statute requires a person to obtain a license, permit, or registration before engaging in a certain business or profession. →To protect the public against dishonest/incompetent practices.

Standardized Contracts

A contract between two parties, where the terms and conditions of the contract are set by one of the parties, and the other party has little or no ability to negotiate. "Shrink-wrap" and "click-wrap" contracts, binding after opened/clicked.

Unenforceable Contract

A contract that is valid, but isn't enforced because of another rule.

Standard of Performance

Courts consider the standard of performance expected. Must be in good faith.

Intoxication

A guard for lack of capacity only when it is so extreme that the person is unable to understand the nature of the bargaining process. Courts are not sympathetic.

Acceptance & Elements (3)

A manifestation of assent to the terms [of the offer] made by the offeree in the manner invited or required by the offer. 1) The offeree intended to enter contract. 2) The offeree accepted on the terms proposed by the offeror. 3) The offeree communicated his acceptance to the offeror.

Merchants - UCC

A person that deals in goods of the kind or otherwise holds itself out by occupation as having knowledge/skill specific to the practices or goods involved in the transaction.

UCC Gap Filling

A price, quantity, and time for payment term left open in a contract can be filled by inserting a presumption found in the codes rules.

Offer & Elements (3)

A promise conditional on an act, return, promise, or forbearance (refraining from doing something); counts as consideration. Elements: 1) Objective indication of a "present intent to contract" on the part of the offeror. 2) Specificity or definiteness in terms. 3) Whether the alleged offer has been communicated to the offeree.

UCC Non-conforming Goods (Accommodation)

A shipment of non-conforming goods does not constitute an acceptance if the seller seasonably notifies the buyer that the shipment is offered only as an accommodation to the buyer. Not seen as a breach of contract, considered a counteroffer.

Substantial Performance Standard

A slightly lower standard applied to duties that are difficult to perform without some deviation from perfection in minor respects.

Implied Warranty of Merchantability

A warranty created by operation of law rather than the seller's express statements. "A warranty that the goods shall be merchantable is implied in a contract for their sale if the seller is a merchant with respect of goods of those kinds." Test (Broad & Flexible): 1) Goods must pass without objection in the trade. 2) Be fit for the ordinary purposes for which such goods are used (*most important requirement). 3) Be of even kind, quantity, and quality. 4) Adequately contained, packaged, and labeled. 5) Conform to any promises/statements made on container/label. 6) In case of fungible goods, be fair in average quality.

Duress

A wrongful threat or act that coerces a person to enter or modify a contract. →Physical, emotional, or economical harm. Given duress, a victim must have no reasonable option, but to enter contract.

Mirror Image Rule - Common Law

Acceptance must be be mirror image of offer. New more liberal view says only "material" variances result in implied rejection of the offer.

Accord and Satisfaction

Accord is an agreement in which a promisee who has existing claim agrees with promisor that she/he will accept some performance different from that originally agreed on. When promisor performs the accord, that is called a satisfaction. Discharge by waiver of promisee (mutual agreement).

Auctions & Bids

Advertisements for bids and sellers at auctions generally are treated as making an invitation to offer, so those bidding are making an offer to the seller to accept/reject.

Advertisements

Advertisements for the sale of goods at specified prices are generally not considered offers, but are invitations to offer/negotiate (sales puffery). Particular ads where the power of acceptance is limited to one or a small number of offerees, highly specific in nature about the number of items offered for sale, and what is requested in return with nothing left to negotiate can be considered a contract (express unilateral). Ads are not contracts because the the advertiser could be bound by an excessive number of contracts over the goods available.

Rewards

Advertisements offering rewards for lost, property, information, or capture of criminals are treated as offers for unilateral contracts. To accept and receive reward, offeree must perform requested act.

Illegality

An agreement will be unenforceable because of illegality if the agreement involves an act or promise that violates a law or is against public policy. →Even if voluntary consent existed between both parties with capacity. →No remedy for breach of contract.

Restatement of Contracts

An attempt to codify and synthesize the soundest principles of contract law gleaned from thousands. of often conflicting, judicial decisions. Judgement of leading scholars was heavily influential in shaping contract law.

Warranty

An express or implied promise about the nature of the product sold. →Plaintiff can claim the product failed to live up to the promise. →Plaintiff can claim defendant was negligent or that strict liability should apply.

Firm Offer & Elements (4)

An irrevocable offer made by a merchant. 1) Offer made by merchant. 2) Offer is signed 3) Is in writing. 4) Offer gives assurance that will be kept open. *Does not need consideration.

Quasi-Contract

An obligation imposed by the law to prevent unjust enrichment of one party in certain circumstances. Remedy: →Reasonable value of the benefit conferred on the defendant (reasonable price). OR →Price of labor (quantum merit).

New Terms

Any acceptance that includes new or variant terms from the offer is rejection (counteroffer).

Implied Warranty Disclaimers

Basic Tests of UCC: Makes it relatively easy for sellers to disclaim the implied warranties of merchantability and fitness for a particular purpose. To exude/modify the implied warranty of merchantability, the seller must: 1) Use the word merchantability. 2) Make the disclaimer conspicuous (clearly visible) if it is written. To exude/modify the implied warranty of fitness for a particular purpose, the seller must: 1) Use writing. 2) Make the disclaimer conspicuous (clearly visible). Other ways to disclaim implied warranties: →Terms: Such as "with all faults", "as is", and "as they stand". Some courts enforce only with used goods. →Inspection: If buyer fails to find defect or if seller refuses to perform inspection →Course of Dealing/Performance or Usage of Trade: Accepted trade practices, regular conduct.

Mutual Mistake

Both parties are mistaken. Elements (To Avoid Contract): 1) Mistake relates to the basic assumption on which the contract was made. 2) Mistake has a material effect on the agreed upon exchange. 3) Party adversely affected by the mistake did not bear the risk of the mistake.

Grumbling Acceptance

Complaining about the terms of the contract, not rejection.

Justifiable Reliance

Complaining party's reliance must be justifiable, an assertion that is obviously false or not to be taken seriously is not justifiable. Must determine the extent the party is responsible for investigating the accuracy of a statement. →Lack of the discovery of facts does not make the reliance unjustifiable unless fault was to extreme (greater degree of accountability on the person that makes the assertion).

Constructive Conditions (Implied-In-Law)

Condition imposed by law rather than by agreement of parties to do justice between them.

Implied-In-Fact Conditons

Condition not specifically stated by the parties, but is implied by the nature of the parties' promise.

Express Conditons

Condition specified in the language of the parties' contract. →Satisfaction of 3rd parties (lawyers - legally sufficient). →Personal satisfaction (client).

Limitations of Remedies

Consequential damages are the usual target of remedy limitations. Tort Cases: The tests for the enforceability of remedy limitations resemble previous tests for tort liability disclaimers. UCC: The standards for the remedy limitations allow for consequential damages in express and implied warranty cases unless the limitation of remedy "fails of its essential purpose" or is unconscionable. →Usually unconscionable when the sale is for consumer goods and personal injury is suffered.

Contracts of Adhesion & Elements (3)

Contract drafted by one party in a position of power, leaving the weaker party to "take it or leave it". Elements: 1) Offered by party in superior bargaining position. 2) Take it or leave it basis. 3) No opportunity to negotiate or understand terms, Courts enforce unless: →Terms are unduly harsh, oppressive, or unconscionable. OR →Terms are such that adhering party could not know be expected to know what she was agreeing to.

Exculpatory Clauses & Elements (3)

Contract provision that relieves one party of liability if damages are caused during the execution of the contract. Elements: 1) Cannot protect for any wrongdoing greater than negligence. 2) Will not exclude tort liability from someone who owes a duty to the public. 3) Removal of benefit that is provided by statute or common law. *Will not be enforced if "unconscionable" or "contract of adhesion". *Courts disfavor; clear language important.

Hybrid Contracts

Contracts involving both goods and services. Rules based on which element predominates the contract.

Unconscionable Disclaimers

Courts may apply unconscionably standards to implied warranty disclaimers even though those disclaimers satisfy the requirements.

Coveat Emptor vs. Coveat Venditor

Coveat Emptor: Risk of defective products were put on the consumer (past). Coveat Venditor: Less perceived need to protect manufacturers from liability (current).

Common Law Contract Law

Deals with contracts that involve the sale of real-estate, services, and all other intangibles.

Liquidated Debts

Debts that which both parties have no dispute about their existence of amount.

Disclaimers of Tort Liability

Disclaimers of negligence, liability, and strict liability are usually ineffective in cases involving ordinary consumers. Courts may enforce in cases where both parties are business entities: 1) Dealt in a commercial setting. 2) Equal bargaining power. 3) Bargained over the product's specifications. 4) Negotiated the risk of loss from product defects.

Duty to Return Consideration

Each party must return any consideration given by the other (money/goods) and pay reasonable value for necessaries upon disaffirmance. →Most state statues allow the minor to disaffirm even if they are unable to return consideration. →UCC says that the minor cannot recover goods that have been transferred in good faith to purchaser (faking age).

Firm Offer (Consideration)

Firm offer doesn't need consideration.

Silence as Acceptance

General rule that says an offeree's silence is not acceptance. Circumstances may impose a duty to reject offer affirmatively or be bound.

Additional Terms (Non-merchants vs. Merchants Rules (3))

If one or more parties are not merchants, the additional terms can't become part of the contract unless expressly agreed to. If both parties merchants, additional terms can become part of the agreement unless: 1) The offer expressly limited acceptance to its own terms. 2) New terms would materially alter offer. 3) Offeror gives notice of objection to the new terms within a reasonable time of receiving acceptance.

Forbearance to Sue

Intentional delay in collecting a debt or demanding performance on a contract, usually for a specific period of time. Forbearance is often consideration for a promise by the debtor to pay an added amount.

Undue Influence

Involves wrongful pressure exerted on a person during the bargaining process (persuasion rather than coercion). Key is the weakness of the person being persuaded.

Scienter (Fraud)

Legal terms that represents the knowledge of falsity. Person who commits fraud may be liable for damages, possibly punitive damages, and for the tort of deceit. *In some states a person must choose from suing for damages or rescinding the contract.

Magnuson-Moss Act

Limits the seller's ability to disclaim implied warranties. If a seller gives a consumer a full warranty on consumer goods whose price exceeds $10, then the seller may not disclaim, modify, or limit the duration of any implied warranty. If limited warranty, the seller may not disclaim or modify, but may limit the duration of an implied warranty (conspicuously - clear & not unconscionable).

Excuses for Non-performance

May be excused in certain circumstances: →Impossibility (Common Law): It cannot be done by anyone. →Impracticability (UCC): When unforeseen developments make performance highly impracticable, unreasonably expensive, or of little value to promisee; more relaxed than common law.

Disaffirmance (Minors)

Minors lack the capacity to contact; exercising the right to avoid contract (no formal act or statement needed). Adult must perform contractual duties is minor doesn't void contract; power to avoid contract continues for a reasonable time after majority. Some contracts are not voidable by minor (statutory exceptions): →Marriage, child support, student loans, insurance.

Revocations (Offer)

Offeror can revoke anytime prior to acceptance, even if they promised to hold offer open for a stated period of time (except option contract). Must be revoked and communicated to offeree before acceptance, effective upon receipt.

Unilateral Mistake

Only one party makes a mistake, enforceable unless: →Non-mistaken party had reason to know of mistake (taking advantage of other party). OR →Would be unconscionable to enforce contract. Elements (To Avoid Contract): 1) Mistake relates to the basic assumption on which the contract was made. 2) Mistake has a material effect on the agreed upon exchange. 3) Party adversely affected by the mistake did not bear the risk of the mistake.

Past Consideration

Past consideration is an act or benefit given in the past that was not given in exchange for the promise in questions, thus cannot be consideration.

Mental Impairment

People who suffer illness/defect are disadvantaged in their ability to protect their interests in the bargaining process, thus contract makes their contracts void or voidable. Test: Did the person have sufficient mental capacity to understand the nature and effect of contract? →If no, may ratify or disaffirm.

Adjudicated Impairment

Person found incompetent to create contracts by court ruling. Contracts considered void.

Rescission & Elements (4)

Power to cancel contract by the person whose consent was not real (voidable contract). The person who rescinds a contract is entitled to the return of anything given to the other party. Must act promptly & unequivocally (no doubt). → Must avoid any behavior that would suggest that he/she affirms/ratifies the contract. Elements: 1) An untrue assertion of fact was made. 2) Fact asserted was material or fraudulent (scienter). 3) Complaining party entered the contract because of their reliance on the assertion. 4) The reliance of the complaining party was reasonable. *To seek damages, injury must be proven.

Output & Requirements

Prior to UCC, failure to specify the quantity of goods to be produced or purchased rendered these contracts illusory. UCC authorized as long as transactions are in good faith.

Mailbox Rule (UCC vs Common Law)

Properly addressed (and proper postage) dispatched acceptances are effective when dispatched, even if they are lost and never received by the offeror. -Common Law: Dispatch = acceptance, but non-authorized forms of acceptance are only binding by receipt -UCC: Reasonable means of communication sent within a reasonable time effective upon dispatch. Unauthorized forms of dispatch effective on dispatch if received within reasonable time period.

Non-competition Clause & Elements (2)

Public policy reasons supporting non-competes: →To entrust with responsibility. →To work with them in developing marketing strategies & know they wont take them to a competitor. →To train and educate them. Enforceable if: 1) Restriction is reasonable in time, geographic location, and scope. 2) Does not impose an undue hardship on the public or a party →Non-disclosure agreements, confidentiality clauses. *If the sole purpose is to restrain competition, it violates public policy.

Ratification (Rescission)

Ratifying a voidable contract means the person who had the right to rescind elected not to do so (right to rescind ends).

Time of Disaffirmance

Real-estate contracts entered as a minor cannot be voided until adulthood. Must disaffirm a reasonable time into majority otherwise there is risk of ratifying contract (especially if contract gave something of value).

Discharge

Release of obligations under contract. Results from: →Promises being fulfilled. →Failure to perform. →Unsatisfactory performance.

Actual Reliance

Reliance means that a person pursues some course of action because of his/her faith in an assertion made to them. Must be casual connection between the assertion and complaining party's decision to enter contract.

Battle of the Forms - UCC & Elements (2)

Rules: →Was the offeree's communication a "definite and seasonable expression of acceptance" despite additional/different terms? If No = No Contract →Was the offeree's acceptance "expressly conditional" on the offeror's approval to new/different terms. If Yes = No Contract If the offeree's communication was definite and seasonable expression of acceptance and was not made conditional on assent to new or different terms, contract results.

Implied Warranty of Fitness for a Particular Purpose & Elements (3)

Seller knows or has reason to know of a particular purpose for which some item is being purchased by the buyer, there is a implied warranty that the goods will be fit for that particular purpose. Elements: 1) The seller has reason to know a particular purpose for which a buyer requires the goods. 2) The seller has reason to know that the buyer is relying on the seller's skill or judgement for the selection of suitable goods. 3) The buyer actually relies on the seller's skill or judgement in purchasing the goods.

Necessaries

Something essential someone's continued existence and general welfare that has not been provided for them. →Food, shelter, medical care, etc. Minor's, mentally impaired persons, and intoxicated persons all liable for "reasonable value" of the necessaries actually received.

Agreements that Violate Statues

Sometimes government legislatures enact statues that declare certain types of agreements unenforceable, void, or voidable.

Unforeseen Circumstances

Sometimes parties to a contract are allowed by law to change the terms, due to unforeseen circumstances. This is known as changed circumstances in contracts and means the terms of the contract changed because one or both of the parties were no longer able to keep the promises made in the original agreement.

Advertisements (Warranty)

Statements made in advertisements, catalogs, or brochures may be an express warranty If specific and unequivocal (no doubt).

Ratification (Disaffirmance)

Surrendering the right to disaffirm a contract; can only be done effectively after the minor has reached majority. →Can be expressed in oral or written statement. OR →Can be implied by conduct on the part of the former minor.

Materiality of the Breach

Test: Does the breach deprive the party of the benefits reasonably expected (harm, compensation, timing). Standard for determining immateriality is flexible, generally based on the breach, and timing of performance. "Time is of the Essence": Late performance is generally a material breach.

Capacity

The ability to incur legal obligations, acquire legal rights, and give consent. Minors, persons suffering form mental disorders, and intoxicated persons lack capacity. →Can escape the legal consequences of contracts that they enter during incapacity.

Unconscionable Contract - UCC & Elements (2)

The absence of meaningful choice together with terms that are unreasonably advantageous to one of the parties - unreasonably harsh. Courts refuse to grant equitable remedy of specific performance for a breach of contract if it oppressively unfair; can not enforce (strike) or modify (reform). Elements: 1) Procedural unfairness (fine-print, high-pressure sales, jargon). 2) Substantive unfairness, disappropriate amount of risk. Courts enforce unless: 1) There was an absence of meaningful choice because of inequality in bargaining power. 2) The term in unreasonably advantageous/exploitative to one of the parties.

Consideration

The legal value, bargained for and given in exchange for an act or promise; promises not supported by consideration are generally unenforceable by common law.

Emancipation

The termination of a parent's right to control a child and receive services/wages from them. Doesn't give minor right to contract.

Basis to Bargain Requirement (UCC)

UCC requires that the affirmation of promise, description, or sample/model has to become the basis of the bargain for an express warranty to be created.

Express Warranty Disclaimers

UCC says that an express warranty and disclaimer should be read consistently if possible. If not reasonable, disclaimer is unreasonable; express warranties are difficult to disclaim.

Misrepresentation & Elements (4)

When a person enters a contract because of their justifiable reliance on misrepresentation about some important fact, the contract is voidable. Can be "innocent" (not intentionally disruptive) or "fraudulent" (made with knowledge to deceive). Makes contract voidable to injured party. Elements - Innocent: 1) Untrue statement of fact. 2) Fact is material. 3) Reliance (actual). 4) Reliance is reasonable (justifiable).

Estoppel

When a person whose duty is conditional leads other party to rely on his consistence on the condition.

Waiver

When a person whose duty is conditional voluntarily gives up their right to the occurrence of the condition.

Anticipatory Repudiation (Breach)

When a promisor indicates before time for performance that promisor is unwilling or unable to carry out the contract Anticipatory repudiation or anticipatory breach occurs. Promisee has choices: →Withhold his/her own performance and sue for damages for total breach of contract immediately. →Wait to sue until time for performance in case other party changes mind and decides to perform. →Waive his/her rights to performance. *Can stop payment (performance) or file suit.

Communicated to Offeree

When an offeror communicates the terms of an offer, he objectively indicates the intent to be bound by those terms.

Excuse of Conditions

When occurrence of a condition was prevented/hindered by a party benefiting from condition. Performance of the act that constitutes the condition becomes impossible. Ex. Not bringing in car in order to get it fixed.

Promissory Estoppel & Elements (4)

When one party relies upon another party's promise to his/her own detriment, but there is no contract. Elements: 1) Clear and unambiguous in terms. 2) Reliance by the party whom the party is made. 3) The reliance must be both reasonable & foreseeable. 4) The person asserting the estoppel must be injured by the reliance. Remedy: →Force promisor to fulfill promise. OR →Pay compensation.

Present Intent to Contract (Objective Standard of Intent)

Words or acts indicate intent to enter contract upon acceptance. Offeror not joking or haggling. Reasonable person test to signify intent.