Objectives are to enhance predictibility and certainty of contracts. (result: contracts hard to make & hard to break)
Contract Law: Results Oriented (modern approach)
Objectivies are to achieve justice and fairness in individual cases. (result: contracts easier to make & break)
both parties seiously intend to enter into a binding agreement
Each party to a contract must receive "something of value" in return for his/her promise.
Legality of Object
The purpose of a contract must not be lawful and not violate public policy
Each party to a contract must have a minimal level of cognitive ability.
Uniform Commercial Code (UCC) - Contract Law
Applies to contracts for the sale of goods.
Goods (under UCC must be):
- Personal Property (not real)
Common Law - Contract Law
Applies to all other types of contracts other then UCC. (e.g. contracts for employment, services, insurance, sale of real property, and sale of intangibles like patents and trademarks)
Restatement of Contracts
Compilation of common law contract principles
The terms are stated in words (oral or written)
The terms are implied from the conduct of the parties under the circumstances
A promise is made in return for another promise (contract is formed when the return promise is made)
A promise is made in return for the performance of a requested act (the contract is formed only when the requested act has been fully performed).
A contract that meets all of the essential elements
Has no legal effect (no contract created). E.g. drug deal is not enforceable contract.
Situation where at least one of the parties has the option to avoid (or ratify) the contract.
A completed contract that has been fully performed by all parties
A contract that has not been fully performed.
Required to be in a particular form to be valid
All other contracts (beside formal)
If neccessary to do justice, a court will enforce an otherwise unenforceable promise. (Elements: if the promissee reasonably relied on the promise and if the reliance was substantial, then justice requires enforcing the promise even though it is not a contractual promise)
An obligation to pay for a benefit received that is imposed by law to avoid injustice; to prevent unjust enrichment. (Elements: the recipient is aware of a benefit he/she has received, and the recipient has kept the benefit when under the circumstances justice requires him/her to pay for it)
Remedies for Breaking Contracts
Remedy is awarded to place the plaintiff where he should have been had the contract been fully performed. (90% of contracts are performed)
To Enter a Contract, Must Have:
1.) Serious Intent (mutual)
2.) Capacity (age/mental status)
3.) Must be Legal Contract (e.g. no drug deals)
4.) Consideration (not expected to be leagally bound to get something for nothing)