
UCSD—Contract Law Jack Friery Contract Law UCSD Extension Jack Friery, Esq.
Jack Friery, Esq. Course Overview • Objective • Practical knowledge of contract elements • Recognition of contract issues • Approach • Analyze contract law principles • Examine the elements of a contract • Do team and individual practical exercises
Jack Friery, Esq. Contract Overview • What’s a “Contract”? • Risk allocation? • Express? • Implied? • Enforceable? • Void or voidable?
Jack Friery, Esq. Overview (con’t) • Contract types • Express or implied? • Written or oral? • “Quasi-contracts”
Jack Friery, Esq. Overview (con’t) • Elements of valid contract • Offer • Acceptance • Consideration • Lawful purpose • Competent parties
Jack Friery, Esq. Offer • Defined • Offeror proposes • Offeree disposes • Elements • Intent/jokes • Communication • Definiteness
Jack Friery, Esq. Offer (con’t) • Essential terms: • Price • Subject matter • Parties • Time of performance
Jack Friery, Esq. Offer (con’t) • Communication to offerees • Are ads offers? • Revocation of offers • Expiration of offers
Jack Friery, Esq. Acceptance • Defined • Legal manifestation of assent • Saying “yes” the right way • Mirror image rule • Common law rule • Clarifications
Jack Friery, Esq. Acceptance (con’t) • Identity of offeree • Offers to a group • Bilateral or unilateral contract? • Act or promise? • Who decides? • Significance: when contract arises • Counteroffers • Common law • UCC
Jack Friery, Esq. Acceptance (con’t) • How to accept • Conduct • Words • Mailbox rule • Acceptance effective when mailed? • Silence as acceptance • Common law
Jack Friery, Esq. Consideration • Defined • Contracts vs. gifts • Mutuality • Benefit? • Detriment?
Jack Friery, Esq. Consideration (con’t) • Past consideration • Moral consideration • Illusory promises • Preexisting duties • Is the consideration sufficient? • One dollar
Jack Friery, Esq. Consideration (con’t) • Contract modifications • New consideration needed? • Accord & satisfaction • Good-faith disputes
Jack Friery, Esq. Legality & Capacity • Capacity • Age • Necessaries • Mental capacity • Temporary • Declared incompetence • Intoxication • Does other party have to be aware?
Jack Friery, Esq. Legality & Capacity (con’t) • Legality: • Inherently illegal • Technically illegal • Severability clause • Voidability
Jack Friery, Esq. Contractual Intent • Intent defined: subjective or objective? • How would a reasonable person view these facts and circumstances?
Jack Friery, Esq. Mistake • Mistake • Unilateral • Examples • Remedy? (limited) • Bilateral (mutual) • Rescission • Reformation
Jack Friery, Esq. Fraud & Duress • Fraud & misrepresentation • Negligent misrepresentation vs. active fraud • Duress • Physical • Economic • Psychological/mental • Form contracts: enforceable?
Jack Friery, Esq. Writings • Statute of Frauds: do you need a writing? • Real property • Goods >$500 • Marriage • One-year rule • Lifetime contract? • Part performance—the panacea (cure-all)
Jack Friery, Esq. Writings (con’t) • What’s a “writing”? • Cocktail napkin? • Series of incomplete writings? • Emails? • Parol evidence rule • Conflicting verbal and written deals
Jack Friery, Esq. Third Parties • Assignment • Rights • Delegation • Duties • Contract novation—switching a party
Jack Friery, Esq. Enforcement by a Third Party • Third party beneficiaries • Mentioned in contract? • Differing status—can a 3rd party sue either party to the contract? • Creditor • Donee
Jack Friery, Esq. Contract Conditions • Covenants vs. conditions • Covenant=promise • Every contract contains a covenant • Conditions • Examples: insurance policy; alimony agreement • Can initiate or kill a duty
Jack Friery, Esq. Contract Conditions(con’t) • Conditions • Precedent • Subsequent • Concurrent • Implied-in-fact • Implied-in-law
Jack Friery, Esq. Performance & Discharge of Obligations • Effect of performance • Performance/breach • Material breach • Minor breach • “Punch list” items • Rescission by the parties
Jack Friery, Esq. Discharge of Obligations (con’t) • Conditions: met or missed • Failure to cooperate • Anticipatory repudiation • Saying “no” before your time comes • Test: unequivocal statement
Jack Friery, Esq. Discharge of Obligations (con’t) • Insolvency • Bankruptcy—is the contract over, or is it still being performed? • Executory contracts • Executed contracts
Jack Friery, Esq. Discharge of Obligations (con’t) • Impossibility • Objective impossibility • Commercial impracticability • Role of Force Majeure • Death of party • Destruction of subject matter • Failure of consideration
Jack Friery, Esq. Breach, Damages & Remedies • Compensatory damages • “Make whole” damages • Buyer—”cover” • Seller—lost profits • Incidental damages • Expenses • Consequential damages • Test: foreseeabilty
Jack Friery, Esq. Remedies (con’t) • Liquidated damages • Rules for imposing • Can’t be penal • Caps on damages • Limitation of damages • Third-party liability • Specific performance • Punitive damages for breach?
Jack Friery, Esq. E-Contracts • Electronic contracts • Email? • Electronic signatures--Federal E-SIGN Act • Defined • Effect
Jack Friery, Esq. UCC • Article 2: Sale of goods • Applicability • Dollar amount? • Merchant or not? • What are “goods”? • Article 2A: Leases of goods • CISG: International sales of goods
Jack Friery, Esq. UCC (con’t) • General principles • Merchant or non-merchant? • Good faith & fair dealing • Course of dealing • Trade usage & custom
Jack Friery, Esq. UCC (con’t) • Offer/acceptance/consideration • Relaxed rules/commercial reality • Battle of the forms: new and different terms in the acceptance • Merchants • Non-merchants
Jack Friery, Esq. UCC (con’t) • Writing requirement • Rule • Exceptions • Effect of missing terms • Fill-in-the-blanks rules
Jack Friery, Esq. UCC (con’t) • Warranties • Express • Samples/models/catalog • Implied • Merchantability (Hong v. Marriott) • Fitness for a particular purpose
Jack Friery, Esq. UCC (con’t) • Shipment terms • Risk of loss • Role of insurance • Written request for adequate assurances
Jack Friery, Esq. UCC (con’t) • Performance • Breach • Damages • Buyer • Seller • Statute of limitations
Conclusion Questions? Jack Friery, Esq.