1. BASES FOR ENFORCING PROMISES
1.
CONSIDERATION
a. Promise or performance bargained for in exchange - § 71
b. Benefit/detriment - Hamer v. Sidway
c.
Peppercorn/trifling value - Fiege v. Boehm
d.
Was there a bargain? - Feinberg v. Pfeiffer
e.
Past services - Feinberg v. Pfeiffer
f.
Conditional promise to make a gift - Kirksey v. Kirksey
g.
h.
Illusory promises - Strong v. Sheffield
Implied terms
i.
In law - Mattei v. Hopper
ii.
i.
In fact - Wood v. Lucy, Lady Duff- Gordon
Moral obligation unenforceable - Mills v. Wyman
2.
RELIANCE/PROMISSORY ESTOPPEL
a. Promise
b. Action/forbearance
c. Induced by (taken in reliance on)
d. Reasonably expected
e. Preventing injustice - § 90(1)
i.
Remedy limited as justice required - Ricketts v. Scothorn, cf. Feinberg v. Pfeiffer
3.
RESTITUTION
a. Unjust enrichment - Cotnam v. Wisdom
b. No recovery if:
i.
Officious intermeddler
ii.
Volunteer
iii.
Plaintiff with other remedies - Callano v. Oakwood Park Homes
4.
MORAL OBLIGATION
a. Gratuitous new promise reaffirming old debt enforceable
i.
Statute of limitations - § 82(1)
ii.
Discharge in bankruptcy - § 83
iii.
Infancy - § 14, 85
iv.
Promise to pay for material benefit received, necessary to prevent injustice - § 86, Webb v.
McGowin, cf. DeMentas v. Tallas
2. CONTRACT FORMATION
1.
ASSENT
a. Intent to be bound - § 21, Lucy v. Zehmer
2.
OFFERS - § 24
a. Judicial reluctance to find offers
b. Precedent - Owen v. Tunison
c.
d.
Comparison drafting - Harvey v. Facey
Price quotes and ads not offers - § Sec. 26, cmt. b, c
i.
Unless something negates understanding - Fairmount Glass
ii.
"First come, first served" - Lefkowitz
e. Possible responses to offer
i.
Acceptance - § 50
ii.
Inquiry, comment, silence
iii.
Rejection - § 38
iv.
Counter-offer - § 39
v.
Purported acceptance with qualifications
1. Mirror-image rule - § 59
3.
ACCEPTANCES
a. Six questions
i.
Was there an offer? - § 24
ii.
How did offeror invite offeree to accept? - § 32
1. Unilateral (complete performance)
2. Bilateral (promise to perform)
iii.
Did offeree completely perform/promise to perform as invited? - § 4
1. Implicit promise to perform by starting work - Ever-Tite Roofing
iv.
If offeree promises to perform, was promise made in manner permitted by offer? - § 30(2),
Allied Steel
v.
Was notice of acceptance required?
1. Unilateral: No - § 54(1), Carlill v. Carbolic Smoke Ball Co.
2.
vi.
b.
c.
4.
5.
6.
Bilateral: Yes - § 56, White v. Corlies & Tift
Did offeree provide notice of acceptance? - Int'l Filter
Silence not acceptance, exceptions - § 69, Hobbs v. Massasoit Whip Co.
Mailbox rule, exceptions - § 63
TERMINATION OF OFFERS
a. Lapse of time - § 41
b. Revocation by offeror - § 42, 43, Dickinson v. Dodds
c.
Death of offeror - § 48, Earle v. Angell
d.
Rejection by offeree - § 38, Columbus Rolling Mill
i.
Mirror-image rule
LIABILITY DESPITE APPARENTLY FAILED NEGOTIATIONS
a. Breach of implied promise not to revoke offer (option contract) - § 45, Drennan v. Star Paving
b.
Breach of assurances during negotiation - Hoffman v. Red Owl Stores
c.
Breach of contract to negotiate in a particular manner - Channel Home Centers v. Grossman
DEFINITENESS
a. Terms reasonably certain - Varney v. Ditmars
b.
Reluctance to find indefiniteness - Toys
3. REQUIREMENT OF A WRITING FOR ENFORCEABILITY
1.
STATUTE OF FRAUDS
a. Marriage - § 124
b. Year - § 130, Klewin
c. Land - § 125
d. Executor - § 111
e. Goods - UCC 2-201
f.
Suretyship - § 112, Langman v. Alumni Assoc. of UVA
2.
REQUISITES OF A SIGNED WRITING
a. Subject matter
b. Essential terms
c. Signature of party to be charged
3.
EXCEPTIONS TO THE WRITING REQUIREMENT
a. Restitution
b. Equitable estoppel
c. Part performance - Richard v. Richard
d.
Promissory estoppel? - Monarco v. Lo Greco
4. POLICING THE BARGAIN
1.
CAPACITY (VOIDABLE)
a. Infancy - § 14, Kiefer v. Fred Howe Motors
b.
2.
Mental infirmity - § 15, Ortelere, cf. Cundick v. Broadbent
DURESS, MODIFICATION, ATTEMPTED MODIFICATION
a. Not enforceable if:
i.
Duress - § 175, 176
ii.
Pre-existing duty - § 173, Alaska Packers
b. Enforceable if:
i.
Original contract canceled - Schwartzreich
ii.
Changing circumstances (modern modification rule) - § 89, Watkins v. Carrig
3.
MISREPRESENTATION, CONCEALMENT, NONDISCLOSURE (VOIDABLE)
a. Fraudulent/material misrepresentation - § 162, 164
b. Active concealment vs. bare nondisclosure - § 160, 161, Swinton
i.
Confidential relationship vs. arm's length
c. Half-truth - Kannavos
4.
MISTAKE
a. Mutual
i.
Mistake of fact vs. incorrect prediction - Sherwood v. Walker, cf. Wood v. Boynton, Stees
v. Leonard
ii.
Mutual
iii.
Basic assumption
iv.
Material effect
v.
Affected party does not bear risk of mistake
b. Unilateral - § 153
i.
Party does not bear risk of mistake
ii.
Unconscionability
5.
DENYING SPECIFIC PERFORMANCE
a. No equitable relief when:
i.
Damages are adequate remedy - § 359
1. Determining adequacy of damages - § 360
ii.
Grossly unfair exchange - § 364(1)(c), McKinnon v. Benedict
1.
Prospectively, not retrospectively - Tuckwiller v. Tuckwiller
6.
PUBLIC POLICY (VOID) - § 178
a. Promise to commit tort - § 192
b. Marriage - § 189
c. New categories sometimes, but not always, recognized - Black Industries v. Bush
7.
EXCULPATION CLAUSES IN ADHESION CONTRACTS
a. Strict construction - § 206, Gallligan v. Arovitch
b.
Adequate notice - § 211, Klar
c.
d.
e.
Public policy - § 178, O'Callaghan, cf. Henningsen
Unconscionability - § 208, UCC 2-302(1), cmt. 1
Statutes regulating substance of contracts
5. REMEDIES
1.
2.
SPECIFIC PERFORMANCE
a. Limitations
i. Damages would be adequate - §359, 360
ii. Bargain was unfair – McKinnon v. Benedict; Tuckwiller v. Tuckwiller
EXPECTATION DAMAGES
a. Loss in value + other loss – cost avoided – other loss avoided
b. [what ∆ promised – what ∆ delivered] [cost π expected in performance – cost π actually incurred]
c. Limitation
i. Avoidability – Rockingham County v. Luten Bridge
1. Constructive Service – Parker v. 20th Century-Fox
ii. Incomplete or defective performance
1. Jacob & Youngs v. Kent; Peevyhouse v. Garland Coal cf. Groves v. John
Wunder
iii. Uncertainty – Collatz cf. Fera v. Village Plaza
3.
4.
5.
6.
iv. Unforeseeability – Hadley v. Baxendale
LIQUIDATED DAMAGES
a. Limitations
i. Penalty – Dave Gustafson v. State
ii. Unconscionability - Henningsen
RELIANCE DAMAGES
RESTITUTION DAMAGES
NOMINAL DAMAGES - $1 OR 6¢