Contracts Questions Thread

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freegaladvice
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Re: Contracts Questions Thread

Postby freegaladvice » Mon Dec 07, 2009 11:00 am

Now that examining K issues is becoming constructive I could use a little help. I'm trying to create a overarching rule for each topic and was hoping someone could critique the rule I created regarding ambiguous language vis-a-vis conditions.

When it is unclear whether a clause within the K creates an express condition (precedent/subsequent) or a promise, and parol evidence does not resolve the ambiguity, courts will likely construe it as creating a promise in an effort to avoid undue forfeiture. If the clause is determined to be a promise (and later, a constructive condition), it is likely that the next stage of analysis will be to determine: (1) whether that subsidiary promise was breached and, (2) if breaching that promise amounts to a material breach of the K as a whole, or only a partial breach of the K as a whole due to substantial performance. If the clause is determined to be an express condition, strict performance is required (substantial performance does not apply) or performance obligations will be discharged.

Does that language fit the bill?

buslaw4302
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Re: Contracts Questions Thread

Postby buslaw4302 » Mon Dec 07, 2009 1:10 pm

As far as the grandmother hypo, I came up with the following issues and outline. I would really appreciate feedback and I think this could be an effective way to prep for an exam with proper feedback (and effective collaboration) so if i missed anything or am off on my analysis please let me know, I am sure that others will appreciate it as well. Oh and this is one heck of a hypo-- where does this one come from?...

1. Statutes of Frauds Issue: The promise cannot be performed within a year of making the oral promise to perform
a. The response from the grandmother could be argued to counter this issue, but the lack of any material terms or even the indication of a valid contract makes it a VERY weak argument
2. Lack of consideration: Hamer v. Sidway would likely deal with this issue, but she does say “I want to give” indicating a gratuitous promise rather than a bargained for exchange. Still he is foregoing his partying for grades and there is an element of exchange (aside from giftmaking), so there would likely be consideration.

Come to think of it, there'd be likely no consideration because shes bargaining for him to get A's... there is no detriment in getting As, although promissory estoppel would likely come into play because it is reasonable and foreseeable that he would do what it takes to get A's...

3. Is gmas promise illusory? She does not have to act to get the pension and the condition for the promise is entirely up to her discretion. I think Wood v. Lucy and/or Swain Lumber (implied good faith promise to act could deal with this issue)
4. What is the manner of acceptance called for in her offer?
a. If Bilateral: The return promise by the gson could create a valid contract—you could argue the kiss creates a binding contract although it would be a stretch. He does send a return acceptance letter but the terms do vary significantly (materially) from the original offer and would likely be construed as a counter-offer open for acceptance (mirror image rule)
i. The gmas response letter does not seem as if an acceptance to the counter as it contains not a single material term; but it could be argued that he does reasonably and foreseeably rely upon her letter as if it were agreement (again a stretch but he does continue to perform (although in dental school, I am sure there is not another option))
1. I also think maybe a mention of impossibility would get a point (maybe) but if it was foreseeable and understood at the time of making the K (or attempting to… I think this would be a waste)
b. It seems more unilateral, she doesn’t want his promise to work hard, she wants straight As; therefore, his kiss and/or promise letter will be ineffective as an acceptance… this leaves the offer open for acceptance (or revocation)
i. Further, although the grandmother does die before he can fully perform, it can be argued that he began partial performance creating an irrevocable option contract which cannot be revoked by gmas death. Then again, working hard and foregoing a lot of things will likely be “preparations” to performance and not performance itself (i.e. the past 4 months of law school which have no bearing upon our grades).
ii. However, if not the actions before Oct. 1 are not partial performance, the death of the grandmother would revoke the offer even if gson had no knowledge of her death
5. Once grades are returned, even if there was an irrevocable option, he DID NOT PERFORM because his counter offer did not modify the existing agreement so for satisfaction he was required to get all A’s which he did not…
6. Is the executor’s writing an acceptance to answer for the debts of the grandmother?
a. I think this is a decent argument, his writing could satisfy a debt barred by the SOF and does indicate that while there was a contract between the gson and gma, there were issues with it but again, he does not perform his duties under the contract
b. The settlement even if accepted may not be effective to satify the debt owed because the amount in question is not in dispute, so even if cashed there would likely not be a true settlement

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JPeavy44
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Re: Contracts Questions Thread

Postby JPeavy44 » Mon Dec 07, 2009 11:12 pm

vanwinkle wrote:
JPeavy44 wrote:I have a question about bilateral v. unilateral K's

Bilateral K's form at the moment of promise
Unilateral K's form upon performance

In unilateral K's no one is bound until performance in complete. So the offeror could revoke the offer up until completion. Where does partial performance come in? With partial performance a benefit must be conferred to the offeror and once partial performance is determined, there cannot be a revocation. Don't these contradict each other?


Actually that's not correct, in a unilateral K the offeror becomes bound to honor the terms of the offer once partial performance begins. Partial performance creates an irrevocable option for the offeree to complete the performance and receive the agreed-upon compensation. The offeree is not required to finish, but they have the option to once performance has begun. If they walk away nothing happens, but if they finish the offeror must honor the terms of the bargain.

See Restatement § 45. The question is what constitutes part performance; preparations to begin performance probably don't if they're not either expressly mentioned in the discussions or clearly implied in them. Ever-Tite is a good example of the latter, where "performance" was found to have begun by hiring workers, loading a truck, and driving to the house, even though they hadn't begun work on the house yet. The court found that those actions were necessarily a part of performance and so Ever-Tite had begun performance before the contract was rescinded.


Are the rules in GTM all right?

It is partial performance makes a unilateral K irrevocable only under the RST.
But in common law, it can be revoked until performance is complete. Is that right?

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m311
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Re: Contracts Questions Thread

Postby m311 » Mon Dec 07, 2009 11:41 pm

I think that common law rule is a tiny minority now. It's definitely at least a minority. Our prof didn't even make mention of it.

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vanwinkle
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Re: Contracts Questions Thread

Postby vanwinkle » Tue Dec 08, 2009 12:08 am

JPeavy44 wrote:Are the rules in GTM all right?

It is partial performance makes a unilateral K irrevocable only under the RST.
But in common law, it can be revoked until performance is complete. Is that right?


For test answers I would always go with either 1) a case you studied in class or 2) the Restatement. If you only studied the Restatement, go with the Restatement. If you didn't go over either part of this subject, it's not going to be on the test.

I wouldn't trust anything in GTM with regard to actual responses.

It's a book about how to write your answers, not what facts are correct. The explanation I was given is that it's best to write your exam answer like it's a real legal paper (as much as you can in the limited timeframe), which means try to have things to cite to as much as possible. If the only thing you can think of to cite from for that situation is GTM, something's not right there. You should've discussed either a case or the Restatement or something in class. Always go with the options your professor gave you.

Sometimes I worry about discussing things on TLS because I'll get into discussions with people about stuff that we never studied in my class and I'll be like, "Crap, is this something I need to know, that we covered in class, or did I only hear it on TLS? I can't remember," and then have to go search my notes and see if I have any notes on it.

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JPeavy44
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Re: Contracts Questions Thread

Postby JPeavy44 » Tue Dec 08, 2009 12:24 am

vanwinkle wrote:
JPeavy44 wrote:Are the rules in GTM all right?

It is partial performance makes a unilateral K irrevocable only under the RST.
But in common law, it can be revoked until performance is complete. Is that right?


For test answers I would always go with either 1) a case you studied in class or 2) the Restatement. If you only studied the Restatement, go with the Restatement. If you didn't go over either part of this subject, it's not going to be on the test.

I wouldn't trust anything in GTM with regard to actual responses.

It's a book about how to write your answers, not what facts are correct. The explanation I was given is that it's best to write your exam answer like it's a real legal paper (as much as you can in the limited timeframe), which means try to have things to cite to as much as possible. If the only thing you can think of to cite from for that situation is GTM, something's not right there. You should've discussed either a case or the Restatement or something in class. Always go with the options your professor gave you.

Sometimes I worry about discussing things on TLS because I'll get into discussions with people about stuff that we never studied in my class and I'll be like, "Crap, is this something I need to know, that we covered in class, or did I only hear it on TLS? I can't remember," and then have to go search my notes and see if I have any notes on it.


Thanks. I had just figured it all out then that placed some doubt in me. I need to stop going back over this point.

pandacot
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Re: Contracts Questions Thread

Postby pandacot » Tue Dec 08, 2009 9:36 am

buslaw4302 wrote:As far as the grandmother hypo, I came up with the following issues and outline. I would really appreciate feedback and I think this could be an effective way to prep for an exam with proper feedback (and effective collaboration) so if i missed anything or am off on my analysis please let me know, I am sure that others will appreciate it as well. Oh and this is one heck of a hypo-- where does this one come from?...


That was a good analysis! The only other things that I would add is that the g'ma is waiting for the pension to come through, and that might go to any reliance issues of promissory estoppel (could the promise actually induce reliance since the g'ma was not in possession of the money?). The pension might also be used to argue that g'son should have expected further manifestations of assent before assuming that an offer has been made (not the greatest argument, but it's all about points). Also, in a very small minority of jurisdictions, notification of death must be made (I think this is something that is very teacher specific -- my professor taught it, but many probably do not). If no notification, then there is no automatic termination. Lastly, SoF might be argued against because possibility of unilateral.

savagecheater
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Re: Contracts Questions Thread

Postby savagecheater » Wed Sep 15, 2010 3:34 pm

betasteve wrote:
vanwinkle wrote:
napolnic wrote:This. I misspoke because there is no option contract. An option contract requires a separate consideration for its formation (or other means such as start of performance). You can't just say that you'll leave it open. At that point it's a gratuitous promise that can be rescinded unilaterally.


If you look at it as a unilateral contract meant to be accepted by performance (and he did say to accept by delivering the money, instead of promising to pay), then beginning performance creates an irrevocable option allowing the performer to finish the performance. The question in that case is whether going through the motions of gathering up the money constitutes "part performance" in the eyes of a court.

This. And in Ragosta v. Wilder, court held financing was mere preparations, and not the beginning of performance, in nearly an identical fact pattern. What the offeror was bargaining for, explicitly, was money. Obtaining financing wasn't bargained for, so only partially obtaining financing wasn't part performance of what was bargained for.


bumping to ask for clarification on Ragosta v. Wilder. If mods would prefer another thread I'm sorry.

Why did the VT. SupCt strike down equitable estoppel but remand to allow for pursuit of the case under cause for promissory estoppel?

Is it that while Wilder wasn't purposefully trying to make them obtain financing (misrepresentation), the Ragostas, in reliance on his statements that he was going to sell (promise), induced detriment?




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