2012 Cal Bar Prep
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Armadillos from Texas . . .
- Applicable law
- Formation of K
- Terms of K
- Remedies for unexcused nonperformance
- Excuse of non performance
- Third-party problems
Unilateral K trigger
Offer expressly states performance as only possible acceptance.
Art. 2 Mixed Deals Rule
All or nothing / most important part
Art. 2 Mixed Deals Rule Exception
K divides payment = UCC applies to goods; CL applies to the rest
True/False: Potential K answers that state "intent" or "intended" are alwasy wrong answers.
True - They are always wrong answers.
Under common law, is price required in a sales K or offer to K?
Yes. Lacking that term voids the K, or results in no offer.
Under Art. 2, is price required in a sales K or offer to K?
No. Gap-filling provisions take care of it.
What ambiguous terms will void an offer?
A - Any terms
B - Material terms
B - Material terms
Trigger words for vague offer terms.
Triggers for requirements or output Ks.
Test for whether post-K increase voids output or requirements K.
Is the increase unreasonsably disproportionate to the original amount.
Note: decreases are not tested
- 1 - Was there an offer?
- 2 - Was the offer terminated?
- 3 - Was the offer accepted?4 - Is there a reason to not enforce the agmnt?
Reasons to not enforce the agmtn:
- Defendant's Capacity
- Statute of Frauds
- Public Policy
- Duress/Undue Influence
- Mistake of Fact
- Ambiguity in Agreement Wording
Four Methods of Offer Termination
- 1 - Lapse of Time
- 2 - Death of party prior to Acceptance.
- 3 - Revocation (offeror)
- 4 - Rejection (offeree)
Offer termination by Lapse
time state or reasonable time
Offer termination by Death
Death / incapacity before acceptance.
Offer terminatin by Revocation
Words - unambiguous, communicated to offeree
Conduct - unambiguous, offeree knows about it
Can an advertisement be an offer?
- - Unilateral K language "$100 to anyone who catches the flue after using our product as directed"
- - States quantity and who can accept: "1 fur coat for $10, first come, first served"
Are multiple offers a revocation?
Can an offeree accept an offer, held by an option, after the option expires?
Yes. Option expiration alone does not revoke an offer.
UCC Firm Offer Rule
- 1 - Merchant
- 2 - offers to buy or sell
- 3 - signed stated promise to keep the offer open
UCC limits time offer open to a max of 3 months.
Test for reliance that makes an offer irrevocable:
- 1 - offeree relies on the offer
- 2 - reliance was reasonably foreseeable to offeror
- 3 - reliance was detrimental to offeree
Once performance begins on a unilateral K, who cannot revoke?
Offeror. Must give offeree reasonable time to complete the performance.
Unilateral K - difference b/w performance and mere preparation.
everything is mere preparation until offeree begins the act that offeror stated
CL - Counter offer
Rejection and new offer. Old offer cannot be accepted.
UCC - Counter offer
Generally treated as a "seasonable expression of acceptance".
CL - Additional terms in counter offer
Rejection of previous offer makes new terms part of the new offer.
The most common Cal Bar essay question and the most frequent MBE question referring to contracts addresses what?
Whether there is a legally enforceable agreement. --> Formation.
Part performance of a _____ K does NOT satisfiy the SoF.
If you're told the sale price in the prompt, it is either a:
- 1) Money damages question; or
- 2) Statute of Frauds question
SoF - Sale of good Ks . . .
. . . do not need to mention the price in the writing to satisfy the Statute of Frauds.
How do you spell p__ evidence?
Standard for compliance with express condition:
Trigger words for Express Condition:
- only if
- provided that
- so long as
- subject to
- in the event that
- on condition that
Past/moral consideration is good for:
Debts, promised in writing, based on a prior debt that is uncollectable due to a technicality (SOL, BK).
What if a counter offer ends in a question mark?
It's bargaining, and NOT a counter offer.
Effect of Conditional Acceptance:
Terminates the offer.
Does a counter offer kill an option?
Mirror Image Rule:
Response that adds terms is rejection and counter offer.
Battle of the Forms (2-207)
- Response to offer, with new terms:
- 1 - Accepts the offer, forming a contract b/c it is a seasonable expression of acceptance
- 2 - Same terms are included
- 3 - Additional terms might be part of the K.
Battle of the Forms, additional terms test:
- Part of the K only if:
- 1 - both parties are merchants
- 2 - additional term not material
- 3 - additional term not rejected
Mailbox rule exception:
Mailbox rule does not apply if offeror states that acceptance must be received by ___.
Can you use the mailbox rule to meet an option deadline?
X orders red widgets; Y ships blue widgets. Result:
X's order is an offer; Y's performance is acceptance; forms contract; Y's shipment of incorrect goods is a breach.
Seller to ship nonconforming goods, stating that the goods are only an accomodation.
Effect of Accomodation:
Counter offer and no breach. K not formed until buyer accepts nonconforming goods.
Can an offer be assigned?
Legal reasons to not enforce:
- 1 - Lack of consideration
- 2 - lack of capacity
- 3 - Statute of Frauds
- 4 - law prohibit performance
- 5 - public policy - never on the bar
- 6 - misrepresentation
- 7 - nondisclosure
- 8 - duress
- 9 - ambiguity
- 10 - unconscionability
- 11 - mistake
- 1 - bargained for,
- 2 - legal detriment
Is a promise consideration?
When is a promise illusory?
If promissor can change mind/terminate at will, without notice.
When is past consideration sufficient?
- 1 - expressly requested by promissor,
- 2 - promisor knows promisee expects payment
Is a pre-existing duty sufficient for consideration?
CL - Never.
Art. 2 - New consideration is NOT necessary to modify sale of goods contracts.
Modern - Only sufficient for consideration IF the duty is owed to a third person.
Promise to forgive balance of debt as consideration requires:
Debt is not due / is disputed.
OR if it is:
- 1 - Written promise;
- 2 - to satisfy obligation
- 3 - for obligation for which there is a technical defense.
Promissory estoppel requires:
- 1 - Promise;
- 2 - Reliance that is reasonable, detrimental, and forseeable
- 3 - Enforcement necessary to avoid injustice.
Consequences of incapacity:
Ks w/in the Statute of Frauds:
1 - Promise to answer for debts of another [suretyship];
2 - Service not capable of being performed w/in 1 yr;
3 - Transfers in real estate;
4 - Sales of goods over $500.
Promise to answer of the debts of another requires:
- 1 - guarantee to pay if someone else does not;
- 2 - main purpose is NOT to benefit to guarantor.
Note: if main purpose is to benefit the guarantor, the K is NOT w/in the SoF, and neither is the guarantee.
Service contract not capable of being performed w/in the time of contracting requires:
Capable = impossible, even w/o unlimited resources
If capable, it's a task and NOT w/in the SoF
Is a one-year lease within the SoF?
Nope, b/c it's one year or less.
Satisfying the SoF requires:
- 1 - Performance; OR
- 2 - a Writing
[SoF] Performance and transfer of real estate requires:
- ANY TWO of:
- 1 - improvements to the land;
- 2 - payment;
- 3 - possession.
[SoF] Performance and service Ks requires:
Full performance by any party.
- Part Performance NEVER satisfies SoF.
- --> but look for recovery under quasi-contract
If prompt mentions sale price, the quesiton is on:
- 1 - Money Damages; or
- 2 - Statute of Frauds
[SoF] Seller's part performance in sales contracts:
Delivered Goods --> No SoF Defense.
Undelivered Goods --> Yes, SoF Defense.
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