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A contract for services is governed by the common law of contracts.
Requires offer, acceptance, consideration, and no defenses.
Occurs when a party expressly or impliedly repudiates K at or prior to performance. When repudiation occurs before performance is due, it is anticipatory and may be retracted until performance is due or until relied on.
Arises by a positive statement by by promisor to promisee that promissor will commit a material breach or voluntary affirmative act that renders the promisor unable or apparently unable to perform without material breach.
- Any non performance of contractual duty when performance is due.
- Material: when substantial benefit of bargain not received by injured party. May suspend own performance and/or sue for damages.
- Minor: when injured party receives substantial benefit of the bargain, but performance defective. Injured party may sue for damages.
Discharge by Accord and satisfaction
- An agreed upon settlement of a disputed obligation and performance of that settlement.
- Requires: bona fide dispute, an agreement to settle, and performance of that agreement.
- Accord suspends obligations under original contract until satisfaction, and then the original obligations are discharged.
An event that must occur before promisee has right to performance by promisor. Promisor has a duty to make good faith efforts to satisfy conditions.
Party injured by breach is entitled to recover the amount of money that would place them in same position they would have occupied if the contract had been performed.
Expectation damages must be reasonably certain, foreseeable, and unavoidable.
Frustration of purpose
When K can be performed but central purpose is undermined, duty to perform is discharged if promisor was without fault in causing frustration and it was not foreseeable.
Injured party must make reasonable efforts to mitigate or avoid damages resulting from another party's breach. Avoidable damages are not recoverable.
- manifestation of assent in the manner invited and time required.
- Mirror image rule, mailbox rule.
bargained-for exchange of legal value.
Parol Evidence rule
A final written expression of parties' may not be contradicted by evidence of a prior written agreement of contemporaneous oral agreement.
Berg Context Rule: extrinsic evidence admissible to determine intent and context surrounding formation.
is a manifest willingness to bargain seeking another's mere agreement.
Discharge by Waiver
Intentional and voluntary relinquishment of a known right, and can result from an express statement or inferred from conduct.
Restitutional Damages (Quantum meruit)
Quasi-contractual recovery is a remedy invoked to prevent unjust enrichment. Can be obtained if a party who breached contractual duties after part performance and whose breach was not willful.
Recoverable when were in contemplation of parties when K was made because they would accrue naturally from the breach or parties had special notice that such damages might arise, consequential damages were the proximate result of breach party's nonperformance, and amount is proven with reasonable certainty.
must have separate consideration to be binding. Mutual modification acceptable.
Pre-existing Legal Duty Rule
an agreement to do what one is already obligated to do is not consideration.
Statute of Frauds
Defense against formation. K must be in writing if it cannot be completed within 1 year, for marriage, land, goods, surety, executorship. (MYLEGS)
Defense against formation. Factual error regarding fundamental matter, which has material affect on agreed exchange. Adversely affected party may rescind K provided that party did not bear risk of mistake.
- Mutual mistake: no K
- Unilateral mistake: which party bore risk?
Defense against formation. Innocent or negligent untrue assertion of fact or omission renders K voidable if material and induced detrimental reliance.
Defense against formation.
Defense against formation. Infancy, Insanity, Intoxication
Defense against formation. K formed by minor voidable unless minor ratifies at age of majority. (Married to adult, treated like one)
Defense against formation. Contract voidable if unable to understand nature and consequences of transaction.
Defense against formation. Volunatary not a defense, unless other party knew and took gross advantage.
Defense against formation. Voidable. Absence of meaningful choice in bargaining process or unreasonably harsh terms.
Defense against formation. Physical duress voids. Economic duress renders K voidable.
- Defense against formation.
- If both parties knew, no K.
- If only 1 party knew, K on innocent party's terms.
Rules of Construction
- Whole over parts
- written over printed
- words>course of performance>course of dealing>trade custom
SOL for K
- 3 years oral
- 6 years written from time of breach
Discharge by Mutual recission
exchange of mutual promises to end K
Discharge by Novation
Mutual agreement to substitute performing party to K obligation
Discharge by Impossibility
literal impossibility, objectively unforeseeable event impossible to guard against
Discharge by Impracticability
Unduly burdensome, subjective
Discharge by Frustration of Purpose
Central purpose of K undermined. Discharged if promisor w/o fault in causing frustration and not foreseeable.