CHAPTER 9: INTRODUCTION
TO CONTRACTS
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TOPICS COVERED IN CHAPTER 9:
INTRODUCTION TO CONTRACTS
A. Development of the Law of Contracts.
B. Definition of a Contract.
C. Requirements of a Contract.
D. Classification of Contracts .
E. Promissory Estoppel.
F. Quasi Contracts.
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LAW OF CONTRACTS
 Definition of Contract – a binding
agreement that the courts will enforce.
 Common Law – most contracts are
governed primarily by State common law,
including contracts involving employment,
services, insurance, real property (land
and anything attached to it), patents, and
copyrights.
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LAW OF CONTRACTS
 Uniform Commercial Code.
• Article 2 of the UCC governs the sales
of goods.
• Sale – the transfer of title from seller to
buyer.
• Goods – tangible personal property
(personal property is all property other
than an interest in land).
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DEFINITION OF A CONTRACT
 A contract is a binding agreement
that the courts will enforce.
• Not all agreements are enforceable.
• Usually consists of a set of promises by
the promisor (offeror) and the offeree
(promissee) to do—or not do—
something.
• A breach is a failure to keep a promise.
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LAW GOVERNING CONTRACTS
Yes
Specific provision of
UCC applicable?
Sale of goods?
No
No
General contract law
governs
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Yes
UCC governs
REQUIREMENTS OF A CONTRACT
 Mutual Assent – the parties to a contract
must manifest by words or conduct that
they have agreed to enter into a contract.
 Consideration – a mutual exchange of
legal benefit or legal detriment as an
inducement to the other party to make a
return exchange. 
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REQUIREMENTS OF A CONTRACT
 Legality of Object – the purpose of a
contract must not be criminal, tortious,
or otherwise against public policy.
 Capacity – the parties to a contract must
have contractual capacity.
 STEINBERG V. CHICAGO MEDICAL SCHOOL
(1976).
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VALIDITY OF AGREEMENTS
Mutual Assent?
Yes
Consideration?
No
Void
No
Yes
Capacity?
No
Yes
No
Free from Invalidating Conduct?
Void or Voidable
Yes
Subject Matter Legal?
Yes
No
Statutes of Frauds Satisfied?
Unenforceable
No
Yes
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Valid Contract
CLASSIFICATION OF CONTRACTS
 Express and Implied Contracts.
• Express Contract – an agreement that is
stated in words, either orally or in writing.
• Implied in Fact Contract – a contract in
which the agreement of the parties is
inferred from their conduct.
• FOX V. MOUNTAIN WEST ELECTRIC, INC.
(2002). 
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CLASSIFICATION OF CONTRACTS
 Bilateral and Unilateral Contracts
• Bilateral Contract – a contract in which
both parties exchange promises.
• Unilateral Contract – a contract in
which only one party makes a promise.
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CLASSIFICATION OF CONTRACTS
 Valid, Void, Voidable, and
Unenforceable Contracts.
• Valid Contract – one that meets all of
the requirements of a binding contract.
• Void Contract – no contract at all;
without legal effect. 
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CLASSIFICATION OF CONTRACTS
 Valid, Void, Voidable, and
Unenforceable Contracts.
• Voidable Contract – a contract capable
of being made void.
• Unenforceable Contract – a contract for
the breach of which the law provides no
remedy.
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CLASSIFICATION OF CONTRACTS
 Executed and Executory Contracts.
• Executed Contract – a contract that has
been fully performed by all of the
parties.
• Executory Contract – a contract that
has yet to be fully performed.
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PROMISSORY ESTOPPEL
 Definition – a doctrine enforcing
some noncontractual promises to
prevent injustice.
• SKEBBA V. KASCH (2006). 
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PROMISSORY ESTOPPEL
 Requirements – a promise made
under circumstances that should lead
the promisor reasonably to expect
that the promise would induce the
promisee to take definite and
substantial action, and the promisee
does take such action.
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QUASI CONTRACTS
 Definition – contract implied-in-law.
Obligation not based on express or
implied promises or conduct.
 Requirements.
• A court will impose a quasi contract when
(1)the plaintiff confers a benefit upon the
defendant, (2)the defendant knows or
appreciates the benefit, and .
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QUASI CONTRACTS
 Requirements.
• (3)the defendant's retention of the
benefit is inequitable.
 Remedy – the plaintiff recovers the
reasonable value of the benefit she
conferred upon the defendant.
• WEICHERT CO. REALTORS V. RYAN (1992).
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