Legal Provisions on Contractual Obligations and Modifications

Statues 5-1109- Written irrevocable offer. Except as otherwise provided in section 2-205 of the uniform commercial code with respect to an offer by a merchant to buy or sell goods, when an offer to enter into a contract is made in a writing signed by the offeror, or by his agent, which states that the offer is irrevocable during a period set forth or until a time fixed, the offer shall not be revocable during such period or until such time because of the absence of consideration for the assurance of irrevocability. When such a writing states that the offer is irrevocable but does not state any period or time of irrevocability,it shall be construed to state that the offer is irrevocable for a reasonable time. UCC 2-205- An offer by a merchant to buy or sell goods in a signed writing which by its terms gives assurance that it will be held open is not revocable, for lack of consideration, during the time stated or if no time is stated for a reasonable time, but in no event may such period of irrevocability exceed three months; but any such term of assurance on a form supplied by the offeree must be separately signed by the offeror. UCC 2-207- (1) A definite and seasonable expression of acceptance or a written confirmation which is sent within a reasonable time operates as an acceptance even though it states terms additional to or different from those offered or agreed upon, unless acceptance is expressly made conditional on assent to the additional or different terms. (2) The additional terms are to be construed as proposals for addition to the contract . Between merchants such terms become part of the contract unless: ● (a) the offer expressly limits acceptance to the terms of the offer; ● (b) they materially alter it; or ● (c) notification of objection to them has already been given or is given within a reasonable time after notice of them is received. (3) Conduct by both parties which recognizes the existence of a contract is sufficient to establish a contract for sale although the writings of the parties do not otherwise establish a contract. In such case the terms of the particular contract consist of those terms on which the writings of the parties agree, together with any supplementary terms incorporated under any other provisions of this Act. UCC 2-206(1)(a)circumstances (1) Unless otherwise unambiguously indicated by the language or ● (a) an offer to make a contract shall be construed as inviting acceptance in any manner and by any medium reasonable in the circumstances; GOL 5-1105 -A promise in writing and signed by the promisor or by his agent shall not be denied effect as a valid contractual obligation on the ground that consideration for the promise is past or executed, if the consideration is expressed in the writing and is proved to have been given or performed and would be a valid consideration but for the time when it was given or performed. GOL 5-1103- An agreement, promise or undertaking to change or modify, or to discharge in whole or in part, any contract, obligation, or lease, or any mortgage or other security interest in personal or real property, shall not be invalid because of the absence of consideration, provided that the agreement, promise or undertaking changing, modifying, or discharging such contract, obligation, lease, mortgage or security interest, shall be in writing and signed by the party against whom it is sought to enforce the change, modification or discharge, or by his agent. UCC 1-207- (a) A party that with explicit reservation of rights performs or promises performance or assents to performance in a manner demanded or offered by the other party does not thereby prejudice the rights reserved. Such words as "without prejudice," "under protest," or the like are sufficient. (b) Subsection (a) does not apply to an accord and satisfaction CPLR 3002-e- Claim for damages and rescission. A claim for damages sustained as a result of fraud or misrepresentation in the inducement of a contract or other transaction, shall not be deemed inconsistent with a claim for rescission or based upon rescission. In an action for rescission or based upon rescission the aggrieved party shall be allowed to obtain complete relief in one action, including rescission, restitution of the benefits, if any, conferred by him as a result of the transaction, and damages to which he is entitled because of such fraud or misrepresentation; but such complete relief shall not include duplication of items of recovery. GOL. 5-701(a)(1)- By its terms is not to be performed within one year from the making thereof or the performance of which is not to be completed before the end of a lifetime GOL. 5-701(a)(2)- Is a special promise to answer for the debt, default or miscarriage of another person UCC 2-201- 1) Except as otherwise provided in this section a contract for the sale of goods for the price of $500 or more is not enforceable by way of action or defense unless there is some writing sufficient to indicate that a contract for sale has been made between the parties and signed by the party against whom enforcement is sought or by his authorized agent or broker. A writing is not insufficient because it omits or incorrectly states a term agreed upon but the contract is not enforceable under this paragraph beyond the quantity of goods shown in such writing. (2) Between merchants if within a reasonable time a writing in confirmation of the contract and sufficient against the sender is received and the party receiving it has reason to know its contents, it satisfies the requirements of subsection (1) against such party unless written notice of objection to its contents is given within 10 days after it is received. (3) A contract which does not satisfy the requirements of subsection (1) but which is valid in other respects is enforceable ● (a) if the goods are to be specially manufactured for the buyer and are not suitable for sale to others in the ordinary course of the seller's business and the seller, before notice of repudiation is received and under circumstances which reasonably indicate that the goods are for the buyer, has made either a substantial beginning of their manufacture or commitments for their procurement; or ● (b) if the party against whom enforcement is sought admits in his pleading, testimony or otherwise in court that a contract for sale was made, but the contract is not enforceable under this provision beyond the quantity of goods admitted; or ● (c) with respect to goods for which payment has been made and accepted or which have been received and accepted (Sec. 2-606 ). GOL 5-703(1)- An estate or interest in real property, other than a lease for a term not exceeding one year, or any trust or power, over or concerning real property, or in any manner relating thereto, cannot be created, granted, assigned, surrendered or declared, unless by act or operation of law, or by a deed or conveyance in writing, subscribed by the person creating, granting, assigning, surrendering or declaring the same, or by his lawful agent, thereunto authorized by writing. But this subdivision does not affect the power of a testator in the disposition of his real property by will; nor prevent any trust from arising or being extinguished by implication or operation of law, nor any declaration of trust from being proved by a writing subscribed by the person declaring the same. Contract notes Promise- declaration by a person (promisor) to do or not to o a certain act. The person to whom the promise is made (the promisee) has a right to demand that something will or not will happen in the future. Contract- A set of promises constung an agreement between pares, giving each a legal duty to the other and also the right to see a remedy for the breach of the promises or dues. Objective theory of contracts- the view that contracting parties shall only be bound by terms that can objectively be inferred from the promises made. REQUIREMENT FOR A CONTRACT: 1) Agreement to form a contract includes an o/er and an acceptence.One party must o/er to enter into a legal agreement, and another party must accept the terms of the o/er. 2) Consideration: Any promise made by the pares must be supported by legally su1cent and bargained for consideration. 3)Contract capacity: Both parties entering into the contract must have the contractual capacity to do so, meaning that the law must recognize them as possessing that qualify them as competent parties. 4) Legality: the contracts purpose must be to accomplish some goal that is legal and not against public policy. Offeror- who makes the o/er. Offeree- a person to whom an offer is made. Bilateral Contract - a type of contract that arises when a promise is given in exchange for a return promise Unilateral Contract - A contract that results when an o/er can be accepted only by the offeree's Performance. In unilateral contracts in modern view is an acon has been substantially undertaken, then the contract is irrevocable. Usually in unilateral, the acceptance is once the action has been completed. Formal Contract : A contract that requires a specific form of creon to be enforceable. Informal Contract : Does not require a specific form of creon to be valid. Express Contract : A contract in which the terms of the agreement are stated in words, oral or wri;en. Implied Contract: A contract formed in whole or in part from the conduct of the pares. *Requirements for implied contract: 1) Plan/ furnished some service or property. 2) The plan/ expected to be paid for that service or property, and the defendant knew or should have known that payment was expected. 3) The defendant had a chance to reject the services or property and did not. Executed Contract: A contract that has been fully performed. Executory Contract: contract that has not yet been fully performed. Unenforceable contract: cannot be legally enforced by some statute or law. Void contract: contract having no legal force or binding e/ect. Quasi contract: An obligation or contract imposed by law (a court), in the absence of an agreement, to prevent the unjust enrichment of one party. Ambiguity in language of a contract: 1) When the intent of the pares cannot be determined from its language. 2)When it lacks a provision on a disputed issue. 3) When a term is susceptible to more than one interpretation. 4)When there is uncertainty about a provision Agreement AGREEMENT Agreement: A mutual understanding or meeng of the minds between two or more individuals regarding the terms of a contract. O/er: a promise or commitment to perform or refrain from performing some specific act in the future. Requirements of the offer 1. There must be a serious objective intention by the offeror 2. The terms of the o/er must be reasonably certain, or de9nite, so that the pares and the court can ascertain the terms of the contract 3. The offeror must be communicated to the offeree once an effective offer has been made the offeree's acceptance of that o/er creates a legally binding contract. In general, advertisements, catalogs, price lists, and circular layers are treated as invitations to negotiate, not as offers to form a contract Revocation: the withdrawal of a contract offer by the offeror. Unless an offer is irrevocable, it can be revoked at any me prior to acceptance without liability. Revocation becomes effective on the offeree or the offeror's agent actually receives it. If the offeree rejects the offer by words or by conduct, the offer is terminated. Any subsequent attempt by the offeree to accept will be construed as a new offer, giving the original offeror the power of Acceptance Counteroffer: an o/er is response to an o/er in which the o/eree rejects original offeror and at the same me make the new offer.Mirror image rule: a common-law rule that requires that the terms of the o/eree's acceptance adhere exactly to the terms of the o/eror's o/er for a valid contract to be formed. Termination By Operation Of Law 1. lapse of time. 2 destruction of the specific subject matter of the offer 3. death or incompetence of the offeror or the offeree 4. supervening illegality of the proposed contract. The state record decision that makes an offer illegal automatically terminates the offer In regards to lapse of me, the me. Normally begins to run when the offer is actually received by the offeree not it is formed or sent. If the offer does not specify a me for acceptance, the offer terminates at the end of a reasonable period of me. Option contract: a contract under which the offeror cannot revoke the offer for a certain time. Because the offeree has given consideration for the offer to remain open. Acceptance acceptance: the actor voluntarily agreed to words or conduct to the terms of an o/er thereby creating a contract .If the acceptance is subject to new conditions or the terms of the acceptance materially change the original o/er, the acceptance may be deemed a counter o/er that implicitly rejects the original o/er Mailbox rule: a common law rule that acceptance takes effect in thus completes formation of the contract at the me the offeree sends or delivers the acceptance in the communication mode expressly or impliedly authorized by the offeror CONSIDERATION consideration: the value given in return for a promise or performance in a contractual agreement. Must be of Legal Sufficient Value 1. A promise to do something that one has no prior legal duty to do ( such as giving money when a debt must be paid) 2. The performance of an action that one is otherwise not obligated to undertake 3. The refraining from action that one has a legal right to undertake. Forbearance: the act of refraining from an action that one has a legal right to undertake. Recession- A remedy whereby a contract is canceled and the parties are returned to the positions they occupied before the contract was made. Past consideration- An act that takes place before the contract that could of been consideration. Liquidated is a claim where the amount due has been settled and both parties agree on it Unliquidated is when the amount has not yet been settled Covenant not to sue- An agreement not to sue if a certain is criteria is met so case won't go to court Promissory estoppel is the legal principle that a promise is enforceable by law, even if made without formal consideration, when a promisor has made a promise to a promisee who then relies on that promise to his subsequent detriment Mistakes Unilateral Mistake- One party makes a mistake Only way to get out of it is 1. If the opposite party should've known that mistake was made 2. The mistake was due to a mathematical error Bilateral Mistake- Both parties make a mistake Either party can be rescinded the contract Fraudulent Misrepresentation when an innocent party is fraudulently induced to enter into a contract, the contract usually can be avoided because she or he has not voluntarily consented to the terms. Normally, the innocent party can either rescind the contract and be restored to her or his original position or enforce the contract and seek damages for any harm resulting from the fraud. 1. A misrepresentation of material fact must occur. 2. There must be an intent to deceive. 3. The innocent party must jus9ably rely on the misrepresentation. Additionally to collect damages, a party must be harmed as a result of the misrepresentation. undue influence: this arises from relationships in which one party can greatly influence another party thus overcoming that pares free will. Duress: agreement to the terms of a contract is not voluntary of one of the pares is forced into the Agreement Illegality Usury- Changing an illegal rate of interest Doing something that requires a license to you. Employment contract- Terms in which the conditions of employment are stated. Reformation- A court ordered correction of contract Exculpatory clause- A clause that releases a contractual party from liability in the event of monetary or physical injury Real estate- Writing is always required in deal with land because of the statute of frauds. GOL 5-703(1)- An estate or interest in real property, other than a lease for a term not exceeding one year, or any trust or power, over or concerning real property, or in any manner relating thereto, cannot be created, granted, assigned, surrendered or declared, unless by act or operation of law, or by a deed or conveyance in writing, subscribed by the person creating, granting, assigning, surrendering or declaring the same, or by his lawful agent, thereunto authorized by writing. But this subdivision does not affect the power of a testator in the disposition of his real property by will; nor prevent any trust from arising or being extinguished by implication or operation of law, nor any declaration of trust from being proved by a writing subscribed by the person declaring the same. GOL. 5-701(a)(1)- By its terms is not to be performed within one year from the making thereof or the performance of which is not to be completed before the end of a lifetime Sales of goods UCC 2-201- 1) Except as otherwise provided in this section a contract for the sale of goods for the price of $500 or more is not enforceable by way of action or defense unless there is some writing sufficient to indicate that a contract for sale has been made between the parties and signed by the party against whom enforcement is sought or by his authorized agent or broker. A writing is not insufficient because it omits or incorrectly states a term agreed upon but the contract is not enforceable under this paragraph beyond the quantity of goods shown in such writing. (2) Between merchants if within a reasonable time a writing in confirmation of the contract and sufficient against the sender is received and the party receiving it has reason to know its contents, it satisfies the requirements of subsection (1) against such party unless written notice of objection to its contents is given within 10 days after it is received. (3) A contract which does not satisfy the requirements of subsection (1) but which is valid in other respects is enforceable ● (a) if the goods are to be specially manufactured for the buyer and are not suitable for sale to others in the ordinary course of the seller's business and the seller, before notice of repudiation is received and under circumstances which reasonably indicate that the goods are for the buyer, has made either a substantial beginning of their manufacture or commitments for their procurement; or ● (b) if the party against whom enforcement is sought admits in his pleading, testimony or otherwise in court that a contract for sale was made, but the contract is not enforceable under this provision beyond the quantity of goods admitted ; or ● (c) with respect to goods for which payment has been made and accepted or which have been received and accepted (Sec. 2-606 ).