Introduction to Contracts

Sources of Contract Law:

• Common Law: Established by court decisions, covers most contracts except for the sale of goods.
• Restatement (2d) of the Law of Contracts: Influential summary of contract principles.
• Uniform Commercial Code (UCC): Governs commercial transactions.
  • UCC §2: For the sale of goods (e.g., cars, books, clothes), different rules than Common Law.
  • Not Covered by UCC §2: Employment, services, real property, intangibles

Contracts

• Definition: A promise enforced by law.
• Essentials: Mutual Assent, Consideration, Legality, Capacity.

Types of Contracts

• Express Contracts: Clearly stated in words.
• Implied-in-Fact Contracts: Understood from conduct.
• Unilateral Contracts: Promise for an act.
• Bilateral Contracts: Exchange of promises.

Validity of Contracts

• Valid: All elements present.
• Void: Lacks essential elements.
• Voidable: Valid but can be canceled.
• Unenforceable: Valid but cannot be enforced.

Offer and Acceptance

• Offer: Intent, Definiteness, Communication.
• Acceptance: Must mirror the terms of the offer.
• Termination of Offer: Lapse of time, Revocation, Rejection, etc.

Consideration

What is Consideration?

• Elements: Legal Sufficiency, Benefit/Detriment, Bargained-for Exchange.
• Illusory Promises: Lack commitment, not enforceable.

Promises Without Consideration

• Exceptions: Promissory Estoppel, Charitable Subscriptions.

Contractual Capacity

Capacity to Contract

• Categories: Minors, Intoxicated Persons, Mentally Incompetent Persons.

Minors

• Right to disaffirm contracts.
• Responsible for necessaries.

Intoxicated and Mentally Incompetent Persons

• Contracts are voidable if they lack understanding.

Conduct Invalidating Assent

• Duress: Coercion into a contract.
• Undue Influence: Dominant party overcomes weaker party's will.
• Fraud: Deception to enter a contract.
• Mistake: Misunderstanding of facts.

Illegal Bargains

Legality

• Contracts must have a legal purpose.

Violations

• Statutes: Licensing, Gambling, Usury, etc.
• Public Policy: Restraints of Trade, Exculpatory Clauses, etc.

Statute of Frauds

Purpose

• Certain contracts must be in writing.

Contracts in Writing

• Suretyship, Interests in Real Estate, Sale of Goods over $500, etc.

Discharge of Contracts

Discharge Methods

• Performance: Complete or substantial.
• Breach: Material breach discharges the non-breaching party.
• Agreement: Mutual rescission, Substituted contract, Novation.
• Law: Impossibility, Impracticability, Bankruptcy.

Negligence

Elements

• Duty, Breach, Causation, Damages.

Defenses

• Comparative Negligence, Assumption of Risk.

Intentional Torts

Types

• Against Persons: Battery, Assault, False Imprisonment, Defamation.
• Against Property: Trespass, Nuisance, Conversion.

Remedies

Purpose

• Compensate for breach or torts.

Types

• Monetary: Compensatory, Punitive, Nominal, Liquidated.
• Equitable: Rescission, Specific Performance, Injunction.