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Contracts - Coggle Diagram

- - - - There is no manifestation of mutual assent to an exchange if the parties attach materially different meanings to their manifestations and
      - neither party knows or has reason to know the meaning attached by the other; or
      - each party knows or each party has reason to know the meaning attached by the other.
      - The manifestations of the parties are operative in accordance with the meaning attached to them by one of the parties if
      - that party does not know of any different meaning attached by the other, and the other knows the meaning attached by the first party; or
      - that party has no reason to know of any different meaning attached by the other, and the other has reason to know the meaning attached by the first party.
      - A says to B, “I offer to sell you my horse for $100.” B, knowing that A intends to offer to sell his cow for that price, not his horse, and that the word “horse” is a slip of the tongue, replies, “I accept.” The price is a fair one for either the horse or the cow. There is a contract for the sale of the cow and not of the horse.
    - - Because a contract is founded upon the agreement of the parties, if they are unaware of critical facts existing at the contract’s inception, a mistake has occurred and the courts may feel compelled to straighten out the resulting confusion. [613]
      - R2C §152. When Mistake of Both Parties Makes a Contract Voidable
        
        Where a mistake of both parties at the time a contract was made as to a basic assumption on which the contract was made has a material effect on the agreed exchange of performances, the contract is voidable by the adversely affected party unless he bears the risk of the mistake under the rule stated in §154.… [613-14]
      - R2C §154. When a Party Bears the Risk of a Mistake
        
        A party bears the risk of a mistake when
        
        (a) the risk is allocated to him by agreement of the parties, or
        
        (b) he is aware, at the time the contract is made, that he has only limited knowledge with respect to the facts to which the mistake relates but treats his limited knowledge as sufficient, or
        
        (c) the risk is allocated to him by the court on the ground that it is reasonable in the circumstances to do so. [614]
      - The typical remedy for mutual mistake is to permit either party to elect rescission, an equitable decree by which the contract is simply cancelled, at which point the court typically orders restitution of the considerations already exchanged.
      - Other losses, such as reliance expenses and consequential damages, fall where they may.
      - Restatement (Second) of Contracts §158 would permit “relief on such terms as justice requires including protection of the parties’ reliance interests.” [614]
      - mutual mistake factors
        
        The question of mutual mistake is determined not by self-serving subjective statements of the parties’ intent, which would necessitate trial to a jury in all such cases, but rather solely by objective circumstances surrounding execution of the release, such as
        
        the knowledge of the parties at the time of signing concerning the injury,
        
        the amount of consideration paid,
        
        the extent of negotiations and discussions as to personal injuries, and
        
        the haste or lack thereof in obtaining the release.
        
        We then turn to an application of the mutual mistake factors in this case. [627-28]
      - In order for the doctrine of mutual mistake to apply, both parties must be mistaken as to the same basic assumption or vital fact otherwise two unilateral mistakes, instead of one mutual mistake would result.
    - - With the exceptions we shall explore in the materials that follow, courts typically deny relief to the erroneous party, encouraging that party to be more careful in the future. [637]
      - Restatement (Second) of Contracts § 153: When Mistake of One Party Makes a Contract Voidable
        
        Where a mistake of one party at the time a contract was made as to a basic assumption on which he made the contract has a material effect on the agreed exchange of performances that is adverse to him, the contract is voidable by him if he does not bear the risk of the mistake under the rule stated in § 154, and
        
        (a) the effect of the mistake is such that enforcement of the contract would be unconscionable, or
        
        (b) the other party had reason to know of the mistake or his fault caused the mistake.
    - - Reformation is most often used to correct a “scrivener’s error” … and can even be used to correct a unilateral mistake if the other side knew of the mistake and remained silent in order to benefit from it.
      - It is occasionally used to correct contracts where there is fraud, duress, undue influence, and unconscionability.
      - Because the primary allegation in a reformation action is that the contract is incorrectly reflected by the writing, the parol evidence rule is inapplicable in such a suit. [641-42]
  - - - Misrepresentation
        
        R2C §162. When a Misrepresentation is Fraudulent or Material
        
        (1) A misrepresentation is fraudulent if the maker
        
        intends his assertion to induce a party to manifest his assent and
        
        the maker
        
        (a) knows or believes that the assertion is not in accord with the facts, or
        
        (b) does not have the confidence that he states or implies in the truth of the assertion, or
        
        (c) knows that he does not have the basis that he states or implies for the assertion.
        
        (2) A misrepresentation is material
        
        if it would be likely to induce a reasonable person to manifest his assent, or
        
        if the maker knows that it would be likely to induce the recipient to do so. [642-43]
        
        R2C §164. When a Misrepresentation Makes a Contract Voidable
        
        If a party’s manifestation of assent is [1] induced by [2] either
        
        a fraudulent or
        
        a material misrepresentation
        
        by the other party
        
        [3] upon which the recipient is justified in relying,
        
        the contract is voidable by the recipient.… [643]
        
        A statement of opinion may be actionable as a misrepresentation where the party stating his opinion possesses superior knowledge of the truth or falsity of the statement.
        
        Promissory Fraud
        
        Mere failure to keep your word does not give rise to a cause of action in fraud, but if the plaintiff can show that at the time the word was given the speaker did not intend to keep it, that is a misrepresentation: the speaker’s true intention.
        
        Fraud & negligent misrepresentation
        
        The elements of fraud are
        
        (1) the defendant made a false representation as to a past or existing material fact;
        
        (2) the defendant knew the representation was false at the time it was made;
        
        (3) in making the representation, the defendant intended to deceive the plaintiff;
        
        (4) the plaintiff justifiably relied on the representation; and
        
        (5) the plaintiff suffered resulting damages.
        
        The elements of negligent misrepresentation are the same except for the second element, which for negligent misrepresentation is the defendant made the representation without reasonable ground for believing it to be true. [654]
        
        punitives
        
        From the plaintiff’s point of view, one attractive feature of a fraud suit is the possibility of substantial punitive damages, which in many jurisdictions also include an award of attorney’s fees [667]
    - - Nondisclosure
        
        R2C §161. When Non-Disclosure is Equivalent to an Assertion
        
        A person’s non-disclosure of a fact known to him is equivalent to an assertion that the fact does not exist in the following cases only:
        
        (a) where he knows that disclosure of the fact is necessary to prevent some previous assertion from being a misrepresentation or from being fraudulent or material.
        
        (b) where he knows that the disclosure of the fact would correct a mistake of the other party as to a basic assumption on which that party is making the contract and if non-disclosure of the fact amounts to a failure to act in good faith and in accordance with reasonable standards of fair dealing.
        
        (c) where he knows that disclosure of the fact would correct a mistake of the other party as to the contents or effect of a writing, evidencing or embodying an agreement in whole or in part.
        
        (d) where the other person is entitled to know the fact because of a relation of trust and confidence between them. [669-70]
        
        If a seller creates a condition that materially impairs the value of a contract and is within the knowledge of the seller or unlikely to be discovered by a prudent purchaser exercising due care, nondisclosure of the condition constitutes a basis for rescission of the contract.
  - - - Void- contract no longer applies
      - Voidable- contract can be made void at the discretion of the party affected
    - - physical compulsion
        
        Rule: Duress by physical compulsion
        
        under Vermont law improper conduct sufficient to render a contract void, as opposed to voidable, consists of
        
        the actual application of physical force that is sufficient to, and does, cause a victim to appear to assent to the execution of a document, as well as
        
        the threat of immediate application of physical force sufficient to place a person in the position of the signer in actual, reasonable, and imminent fear of death or serious personal injury [689-90]
      - improper threat
        
        Rule: Improper Threat
        
        As to duress by improper threat, the Restatement provides a two-prong test: “[i]f a party’s manifestation of assent is induced by
        
        an improper threat by the other party that
        
        leaves the victim no reasonable alternative,
        
        the contract is voidable by the victim.” Id. §175(1).
        
        Thus, there must be both an inducement by an “improper threat” and the victim must have no “reasonable alternative” but to succumb. [687]
  - - - Those found outside of the law in respect to their contracts will not be allowed quasi contractual relief
    - - R2C §181. Effect of Failure to Comply With Licensing or Similar Requirement
        
        If a party is prohibited from doing an act because of his failure to comply with a licensing, registration or similar requirement, a promise in consideration of his doing that act or of his promise to do it is unenforceable on grounds of public policy if
        
        (a) the requirement has a regulatory purpose, and
        
        (b) the interest in the enforcement of the promise is clearly outweighed by the public policy behind the requirement. [712]
    - - The courts tend not to enforce these [non-compete] agreements unless
      - (1) the seller or employee has unique talents, knowledge, or abilities (no court is going to restrain a janitor from sweeping floors for someone else),
      - (2) the area the injunction will cover is reasonable (the spatial limitation), and
      - (3) the time period of restraint is also reasonable (the temporal limitation). [714]
  - - - Those below the “age of majority” (18 in most jurisdictions) are responsible for their torts and crimes but are allowed to disaffirm the contracts they make. [720]
        
        Misrepresentation of age is an issue on which the courts have split ….
        
        Some jurisdictions say that allowing such a misrepresentation to estop the infant would undermine the policy of permitting disaffirmance; other say that the innocent party is the misled adult, and the infant who lies should not be protected (it is only in these jurisdictions that contractual statements such as “I hereby state I am over 18 years of age” have any meaning).
        
        Some states, such as Michigan, will find an estoppel only if the statement of majority is in writing.
        
        If the contract is for something as necessary as emergency medical services, of course the infant cannot disaffirm, since we want the infant to get such services without there being legal restrictions. The cited case allowed the hospital to sue the infant in quasi-contract
    - - R2C §15. Mental Illness or Defect
        
        (1) A person incurs only voidable contractual duties by entering into a transaction if by reason of mental illness or defect
        
        (a) he is unable to understand in a reasonable manner the nature and consequences of the transaction, or
        
        (b) he is unable to act in a reasonable manner in relation to the transaction and the other party has reason to know of his condition.
        
        (2) Where the contract is made on fair terms and the other party is without knowledge of the mental illness or defect, the power of avoidance under Subsection (1) terminates to the extent that the contract has been so performed in whole or in part or the circumstances have so changed that avoidance would be unjust. In such a case a court may grant relief as justice requires. [726-27]
      - factors
        
        When it comes to mental incompetency, there are no black-letter rules and the courts play it by ear, concentrating on the equities of the situation. Key questions are
        
        (1) how necessary is the contract,
        
        (2) how fair is the contract,
        
        (3) did the other side know of the incompetency (we don’t like people taking advantage of the mentally infirm), and
        
        (4) how great is the hardship of allowing disaffirmance
  - - - Leff stated that before a court could deem a contract or any part thereof unconscionable, the court must find both procedural and substantive unconscionability.
      - Procedural unconscionability, according to Leff, meant unfairness in the bargaining process (typically because one party, having the superior position, dictates the terms and refuses to bargain at all).
      - Substantive unconscionability, on the other hand, refers to harsh terms in the resulting contract. [733]
    - - The … ouster doctrine precluded enforcement of arbitration agreements because they “oust the courts of *27 jurisdiction,” or displace judicial power to resolve disputes.
      - The revocability doctrine seemed to reflect a traditional notion that arbitrators were merely agents at the will of the parties who appointed them.142 Under this notion, any party to an arbitration agreement could revoke an arbitrator's authority at any time before the arbitrator rendered an award, even if the parties had agreed the delegation was irrevocable.
  - - - A "force majeure" clause (French for "superior force") is a contract provision that relieves the parties from performing their contractual obligations when certain circumstances beyond their control arise, making performance inadvisable, commercially impracticable, illegal, or impossible. In the absence of a force majeure clause, parties to a contract are left to the mercy of the narrow common law contract doctrines of "impracticability" and "frustration of purpose," which rarely result in excuse of performance
    - - Except so far as a sellermay have assumed a greater obligation and subject to the preceding section on substituted performance:
      - (a) Delay in delivery or non-delivery in whole or in part by a seller who complies with paragraphs (b) and (c) is not a breach of his duty under a contract for sale if performance as agreed has been made impracticable by the occurrence of a contingency the non-occurrence of which was a basic assumption on which the contract was made or by compliance in good faithwith any applicable foreign or domestic governmental regulation or order whether or not it later proves to be invalid.
      - (b) Where the causes mentioned in paragraph (a) affect only a part of the seller's capacity to perform, he must allocate production and deliveries among his customers but may at his option include regular customers not then under contractas well as his own requirements for further manufacture. He may so allocate in any manner which is fair and reasonable.
      - (c) The seller must notify the buyer seasonably that there will be delay or non-delivery and, when allocation is required under paragraph (b), of the estimated quota thus made available for the buyer.
    - - Where the contract requires for its performance goods identified when the contract is made, and the goods suffer casualty without fault of either party before the risk of loss passes to the buyer, or in a proper case under a “no arrival, no sale” term (Section 2-324) then
      - (a) if the loss is total the contract is avoided; and
      - (b) if the loss is partial or the goods have so deteriorated as no longer to conform to the contract the buyer may nevertheless demand inspection and at his option either treat the contract as avoided or accept the goods with due allowance from the contract price for the deterioration or the deficiency in quantity but without further right against the seller.
- - - - the consideration doctrine requires that every agreement involve an exchange of things of value [169]
      - CORBIN ON CONTRACTS §110
        
        To be enforceable, the promise must be accompanied by some other factor…. a true contract will always contain at least one promise … exchanged for something else, a quid pro quo. That “something else” is what the law calls consideration. [170]
      - R2C §71. Requirement of Exchange; Types of Exchange
        
        (1) To constitute consideration, a performance or a return promise must be bargained for.
        
        (2) A performance or return promise is bargained for if it
        
        is sought by the promisor in exchange for his promise and
        
        is given by the promisee in exchange for that promise.
        
        (3) The performance may consist of
        
        (a) an act other than a promise, or
        
        (b) a forbearance, or
        
        (c) the creation, modification, or destruction of a legal relation.
        
        (4) The performance or return promise may be given to the promisor or to some other person. It may be given by the promisee or by some other person. [170]
      - What is a valuable consideration?
        
        may consist either in
        
        some right, interest, profit, or benefit accruing to the one party, or
        
        some forbearance, detriment, loss, or responsibility given, suffered, or undertaken by the other. [173]
    - - Courts Look for the sufficiency of consideration rather than the adequacy
        
        Sufficiency means that the offered consideration must be something that has value in the eyes of the law;
      - Love and affection alone are not sufficient consideration to support a contract.
    - - adequacy refers to the quantity of the amounts exchanged.
        
        But this doctrine does not apply to a mere exchange of sums of money, of coin, whose value is exactly fixed. courts will inquire into fungible adequacy
        
        Mere inadequacy of consideration will not void a contract.
      - R2C §87. Option Contract
        
        (1) An offer is binding as an option contract if it
        
        (a)
        
        is in writing and signed by the offeror,
        
        recites a purported consideration for the making of the offer, and
        
        proposes an exchange on fair terms within a reasonable time; or
        
        (b) is made irrevocable by statute.
        
        (2) An offer which the offeror should reasonably expect to induce action or forbearance of a substantial character on the part of the offeree before acceptance and which does induce such action or forbearance is binding as an option contract to the extent necessary to avoid injustice. [192]
        
        Nominal consideration. Offers made in consideration of one dollar paid or promised are often irrevocable under Subsection (1)(a).…
        
        Consideration is designed primarily to protect promisors from their own donative promises. Options, however, are one commercial step in a commercial deal. [195]
        
        87 1 a is minority position
      - UCC § 2-205. Firm Offers.
        
        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.
  - - - (1) Forbearance to assert or the surrender of a claim or defense which proves to be invalid is not consideration unless
        
        (a) the claim or defense is in fact doubtful because of uncertainty as to the facts or the law, or
        
        (b) the forbearing or surrendering party believes that the claim or defense may be fairly determined to be valid.
      - (2) The execution of a written instrument surrendering a claim or defense by one who is under no duty to execute it is consideration if the execution of the written instrument is bargained for even though
        
        he is not asserting the claim or defense and
        
        believes that no valid claim or defense exists. [203]
      - Comment d.
        
        Forbearance to assert a valid claim or a doubtful or honestly-asserted claim may be consideration for a promise, just as surrender of the claim would be.
        
        Where the forbearance is temporary and it is contemplated that the claim will be asserted later, there is sometimes a question whether the forbearance is bargained for and given in exchange for the promise.
        
        If an offer specifies a return promise to forbear as the requested consideration, forbearance without promise is not an acceptance. Compare § 53.
        
        But a promise to forbear may be implied. Compare §§ 32, 62.
  - - - A promise or apparent promise is not consideration if by its terms the promisor or purported promisor reserves a choice of alternative performances unless
      - (a) each of the alternative performances would have been consideration if it alone had been bargained for; or
      - (b) one of the alternative performances would have been consideration and there is or appears to the parties to be a substantial possibility that before the promisor exercises his choice events may eliminate the alternative which would not have been consideration. [205]
    - - let it be saved rather than destroyed
    - - (2) Where the contract provides for successive performances but is indefinite in duration it is valid for a reasonable time but unless otherwise agreed may be terminated at any time by either party.
      - (3) Termination of a contract by one party except on the happening of an agreed event requires that reasonable notification be received by the other party and an agreement dispensing with notification is invalid if its operation would be unconscionable. [211]
    - - (1) A term which measures the quantity by the output of the seller or the requirements of the buyer means such actual output or requirements as may occur in good faith, except that no quantity unreasonably disproportionate to any stated estimate or in the absence of a stated estimate to any normal or otherwise comparable prior output or requirements may be tendered or demanded.
      - (2) A lawful agreement by either the seller or the buyer for exclusive dealing in the kind of goods concerned imposes unless otherwise agreed an obligation by the seller to use best efforts to supply the goods and by the buyer to use best efforts to promote their sale. [217]
    - - whether the promise states a limitation upon the promisor’s future liberty of action ---->used to determinine whether any promise is illusory
  - - - It is said a moral obligation is a sufficient consideration to support an express promise; and some authorities lay down the rule thus broadly; but upon examination of the cases we are satisfied that the universality of the rule cannot be supported, and that there must have been some pre-existing obligation, which has become inoperative by positive law, to form a basis for an effective promise. [223]
      - When a promisee confers upon a deceased promisor a benefit that is material and substantial, and is conveyed upon the person of the promisor and not merely his estate, the promisee is entitled to recognition and compensation from the promisor’s estate either by an executed payment or an executory promise to pay.
      - The care of youngsters is presumed to be a gift, and creates no quasicontractual action that could provide the missing consideration
      - R2C §86. Promise for Benefit Received
        
        (1) A promise made in recognition of a benefit previously received by the promisor from the promisee is binding to the extent necessary to prevent injustice
        
        (2) A promise is not binding under Subsection (1)
        
        (a) if the promisee conferred the benefit as a gift or for other reasons the promisor has not been unjustly enriched; or
        
        (b) to the extent that its value is disproportionate to the benefit. [232]
        
        Comment a. “Past consideration”; “moral obligation.”
        
        Enforcement of promises to pay for benefit received has sometimes been said to rest on “past consideration” or on the “moral obligation” of the promisor, and there are statutes in such terms in a few states. Those terms are not used here: “past consideration” is inconsistent with the meaning of consideration stated in § 71, and there seems to be no consensus as to what constitutes a “moral obligation.” The mere fact of promise has been thought to create a moral obligation, but it is clear that not all promises are enforced. Nor are moral obligations based solely on gratitude or sentiment sufficient of themselves to support a subsequent promise.
    - - (1) A promise to pay all or part of an antecedent contractual or quasicontractual indebtedness owed by the promisor is binding if the indebtedness is still enforceable or would be except for the effect of a statute of limitations.
      - (2) The following facts operate as such a promise unless other facts indicate a different intention:
        
        (a) A voluntary acknowledgment to the obligee, admitting the present existence of the antecedent indebtedness; or
        
        (b) A voluntary transfer of money, a negotiable instrument, or other thing by the obligor to the obligee, made as interest on or part payment of or collateral security for the antecedent indebtedness; or
        
        (c) A statement to the obligee that the statute of limitations will not be pleaded as a defense. [227]
  - - - if a party to a contract is under a pre-existing duty to perform, then no consideration is given for any modification of the contract and the modification is therefore voidable.
    - - (1) An agreement modifying a contract within this Article needs no consideration to be binding.…
      - Official Comment
        
        This section seeks to protect and make effective all necessary and desirable modifications of sales contracts without regard to the technicalities which at present hamper such adjustments.
        
        Subsection (1) provides that an agreement modifying a sales contract needs no consideration to be binding.
        
        However, modifications made thereunder must meet the test of good faith imposed by this Act. The effective use of bad faith to escape performance on the original contract terms is barred, and the extortion of a “modification” without legitimate commercial reason is ineffective as a violation of the duty of good faith. [237]
    - - A promise modifying a duty under a contract not fully performed on either side is binding
      - (a) if the modification is fair and equitable in view of circumstances not anticipated by the parties when the contract was made; or
      - (b) to the extent provided by statute; or
      - (c) to the extent that justice requires enforcement in view of material change of position in reliance on the promise.
    - - Comment d. Contractual duty to third person.
      - The rule that performance of legal duty is not consideration for a promise has often been applied in cases involving a contractual duty owed to a person other than the promisor…. But the tendency of the law has been simply to hold that performance of contractual duty can be consideration if the duty is not owed to the promisor.
    - - Accord & Satisfaction
        
        An accord is the agreement to accept a substituted or different performance, and a satisfaction is the execution of the new agreement. [239]
      - the “Rule of Foakes v. Beer”
        
        In a modern context an additional promise to do something new in substitution for the original undertaking, such as paying a debt earlier than due, would be sufficient consideration.
        
        if there is either a good faith dispute about whether
        
        there is any debt owed or
        
        the amount of debt owed,
        
        an agreement to pay less than requested by the creditor is supported by consideration [239]
      - UCC §3-311. Accord and Satisfaction by Use of Instrument
        
        (a) If a person against whom a claim is asserted proves that (i) that person in good faith tendered an instrument to the claimant as full satisfaction of the claim, (ii) the amount of the claim was unliquidated or subject to a bona fide dispute, and (iii) the claimant obtained payment of the instrument, the following subsections apply.
        
        (b) Unless subsection (c) applies, the claim is discharged if the person against whom the claim is asserted proves that the instrument or an accompanying written communication contained a conspicuous statement to the effect that the instrument was tendered as full satisfaction of the claim.
        
        (c) Subject to subsection (d), a claim is not discharged under subsection (b) if either of the following applies:
        
        (1) The claimant, if an organization, proves that (i) within a reasonable time before the tender, the claimant sent a conspicuous statement to the person against whom the claim is asserted that communications concerning disputed debts, including an instrument tendered as full satisfaction of a debt, are to be sent to a designated person, office, or place, and (ii) the instrument or accompanying communication was not received by that designated person, office, or place.
        
        (2) The claimant, whether or not an organization, proves that within 90 days after payment of the instrument, the claimant tendered repayment of the amount of the instrument to the person against whom the claim is asserted. This paragraph does not apply if the claimant is an organization that that sent a statement complying with paragraph (1)(i).
        
        (d) A claim is discharged if the person against whom the claim is asserted proves that within a reasonable time before collection of the instrument was initiated, the claimant, or an agent of the claimant having direct responsibility with respect to the disputed obligation, knew that the instrument was tendered in full satisfaction of the claim.
  - - - R2C §90 Promise Reasonably Inducing Action or Forbearance
        
        (1) A promise which the promisor should reasonably expect to induce action or forbearance on the part of the promisee or a third person and which does induce such action or forbearance is binding if injustice can be avoided only by enforcement of the promise. The remedy granted for breach may be limited as justice requires.
        
        (2) A charitable subscription or a marriage settlement is binding under Subsection (1) without proof that the promise induced action or forbearance.
        
        Cf. The courts have been slow to adopt the idea that charitable subscriptions are so freely enforceable. [254]
        
        this applies to agents with apparent authority who enter into contracts on behalf of principals as well
      - Restatement (Second) of Contracts § 87
        
        (2) An offer which the offeror should reasonably expect to induce action or forbearance of a substantial character on the part of the offeree before acceptance and which does induce such action or forbearance is binding as an option contract to the extent necessary to avoid injustice.
    - - To support an action for promissory estoppel, a promise need not contain all of the essential details of the proposed transaction between the promisor and the promisee, so as to be equivalent to an offer that would result in a binding contract between the parties if accepted by the promisee.
      - Courts have sometimes used the doctrine as a cause of action, however Many courts won’t go this far, and specifically hold that promissory estoppel is not an affirmative cause of action, but can only be used defensively to cure defects in the contract ….
        
        Promissory estoppel as an independent cause of action
        
        The Restatement avoids use of the term ‘promissory estoppel,’ and there has been criticism of it as an inaccurate term.
        
        Use of the word ‘estoppel’ to describe a doctrine upon which a party to a lawsuit may obtain affirmative relief offends the traditional concept that estoppel merely serves as a shield and cannot serve as a sword to create a cause of action. ‘Attractive nuisance’ is also a much criticized term.
  - - - Section captions are part of [the Uniform Commercial Code].
    - - 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.
    - - Comment ….
      - Subsection (1) provides that an agreement modifying a sales contract needs no consideration to be binding.
      - However, modifications made thereunder must meet the test of good faith imposed by this Act. The effective use of bad faith to escape performance on the original contract terms is barred, and the extortion of a “modification” without legitimate commercial reason is ineffective as a violation of the duty of good faith. Nor can a mere technical consideration support a modification made in bad faith.
      - The test of “good faith” between merchants or as against merchants includes “observance of reasonable commercial standards of fair dealing in the trade” (Section 2-103), and may in some situations require an objectively demonstrable reason for seeking a modification. But such matters as a market shift which makes performance come to involve a loss may provide such a reason even though there is no such unforeseen difficulty as would make out a legal excuse from performance under Sections 2-615 and 2-616.
- - - - Contracts by an executor or administrator to answer for the debts of a decedent and payable out of the executor/administrator’s own personal assets generally must be in writing.
    - - A “surety” is someone who agrees to be liable for paying someone else’s debt.
        Because becoming a surety is filled with many poorly understood consequences, the statute of frauds provides that a promise to answer for “debt, default or miscarriage of another” (i.e., the promise to become a surety) must be in writing before it is enforceable. [468]
    - - This part of the statute of frauds, contracts “made upon consideration of marriage,” is almost never litigated.
        Note … that the statute of frauds only applies when one person promises to marry and the other person promises to do something else; that is, the statute does not govern “an agreement which consists only of mutual promises of two persons to marry each other.” Restatement (Second) of Contracts §124. [473]
    - - There are two main issues with contracts for the sale of realty: What types of “transfers” are covered and what exactly is “realty”?
      - Clearly, agreements to buy or sell land are within the types of transfers contemplated.
      - Generally, assumptions, extensions, or modifications of real estate mortgages are also covered.
      - An agreement affecting the boundary line of adjoining landowners has been held not to require a writing…. but see Restatement (Second) of Contracts §128.
    - - This aspect of the statute applies to agreements that cannot be fully performed within a year of their making. See Restatement (Second) of Contracts §130. This principle may sound straightforward, but it is slippery in practice. [483]
      - Restatement (Second) of Contracts § 130 (1981)
        
        (1) Where any promise in a contract cannot be fully performed within a year from the time the contract is made, all promises in the contract are within the Statute of Frauds until one party to the contract completes his performance
        
        .
        (2) When one party to a contract has completed his performance, the one-year provision of the Statute does not prevent enforcement of the promises of other parties.
      - Where the terms of an oral agreement can fairly and reasonably be interpreted to define alternate methods of performance, one or more of which can be performed within one year, the agreement may be construed as capable of being performed within one year and does not violate the one-year provision of the statute of frauds.
      - The general rule is that a contract that does not specifically state a time that is more than one year is not within the statute even if the time for completion of the contract is very likely to be more than one year.
      - longer than one year to perform= must b in writing
    - - If the parties to an existing contract modify it, the modification must also be in writing if the original contract needed to meet the statute.
      - Also if the contract as modified falls within the statute, the contract with modification must comply with the writing requirement. See, e.g., UCC §2-209(3). [489]
      - UCC § 2-209. Modification, Rescission and Waiver.
        
        (3) The requirements of the statute of frauds section of this Article (Section 2-201) must be satisfied if the contract as modified is within its provisions….
    - - UCC § 2-201. Formal Requirements; Statute of Frauds.
        
        (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….
      - To satisfy the statute of frauds, the quantity term in a requirements contract need not be numerically stated, but there must be some writing that indicates that the quantity to be delivered under the contract is a party’s requirements or output.
  - - - Unless additional requirements are prescribed by the particular statute, a contract within the Statute of Frauds is enforceable if it is evidenced by any writing, signed by or on behalf of the party to be charged, which
        
        (a) reasonably identifies the subject matter of the contract,
        
        (b) is sufficient to indicate that a contract with respect thereto has been made between the parties or offered by the signer to the other party, and
        
        (c) states with reasonable certainty the essential terms of the unperformed promises.
      - [Comment g to this section provides: “What is essential depends on the agreement and its context and also on the subsequent conduct of the parties, including the dispute which arises and the remedy sought.”] [495]
  - - - Can recover for restitution damages even if contract is not in writing
    - - R2C §129. Action in Reliance; Specific Performance
        
        A contract for the transfer of an interest in land may be specifically enforced notwithstanding failure to comply with the Statute of Frauds if it is established that the party seeking enforcement, in reasonable reliance on the contract and on the continuing assent of the party against whom enforcement is sought, has so changed his position that injustice can be avoided only by specific enforcement. [501]
      - Uniform Commercial Code §2-201
        
        …(3) A contract which does not satisfy the requirements of [the UCC statute of frauds] but which is valid in other respects is enforceable…(c) with respect to goods for which
        
        payment has been made and accepted or
        
        which have been received and accepted. [502]
      - Oral agreements involving the sale of land may satisfy the statute of frauds where writings between the parties detail the terms of the agreement or where there has been part performance of the agreement.
      - Part performance is a recognized exception of the requirement of the statute of frauds.
      - One of the requirements of the doctrine of part performance is that the acts relied upon as constituting part performance must unmistakably point to the existence of the claimed agreement. If they may be accounted for by some other hypothesis they are not sufficient. [507]
    - - In many jurisdictions, there is no “judicial admission” exception to the statute of frauds under the common law. Thus, the statute applies even “if the party against whom enforcement…is sought has admitted that a contract was made.”
      - However, as noted below, the UCC takes a contrary view. [513]
      - Even before the widespread adoption of the Uniform Commercial Code and its so-called admission exception, courts in a number of jurisdictions had declared that a defendant's admission of the existence of an oral contract would prevent that party from thereafter relying on the Statute of Frauds, and, spurred on by the passage of the U.C.C., an even greater number of courts has in recent years embraced this position in settings outside the sale of goods.
      - Although this view remains a minority position in nonsale-of-goods cases, it clearly reflects the trend … and, when the contract involves the sale of goods, the Uniform Commercial Code explicitly adopts this position as its governing rule.
    - - Uniform Commercial Code §2-201.
        
        … (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 [the UCC statute of frauds] against such party unless written notice of objection to its contents is given within 10 days after it is received. [515]
      - Under the “merchants” exception created by the Uniform Commercial Code, the Statute of Frauds is satisfied where one merchant sends a written confirmation of an oral contract within a reasonable amount of time and the party receiving the written confirmation has reason to know its contents.
    - - It has been long settled in most jurisdictions that a party may be estopped to assert the defense of the statute of frauds when the elements of an equitable estoppel exist.
      - For an equitable estoppel to arise, there must be some misrepresentation giving rise to the detrimental reliance.
      - In a case where the statute of frauds is at issue, the misrepresentation may be shown by evidence that the party relying on the statute had misrepresented
      - that a writing was needed,
      - that a writing would be executed, or
      - that a writing had already been executed. [520]
      - R2C §139. Enforcement by Virtue of Action in Reliance
        
        (1) A [1] promise which [2] the promisor should reasonably expect to induce action or forbearance on the part of the promisee or a third person and [3] which does induce the action or forbearance is enforceable notwithstanding the Statute of Frauds [4] if injustice can be avoided only by enforcement of the promise. The remedy granted for breach is to be limited as justice requires.
        
        (2) In determining whether injustice can be avoided only by enforcement of the promise, the following circumstances are significant: …. [521]
        
        (a) the availability and adequacy of other remedies, particularly cancellation and restitution;
        
        (b) the definite and substantial character of the action or forbearance in relation to the remedy sought;
        
        (c) the extent to which the action or forbearance corroborates evidence of the making and terms of the promise, or the making and terms are otherwise established by clear and convincing evidence;
        
        (d) the reasonableness of the action or forbearance;
        
        (e) the extent to which the action or forbearance was foreseeable by the promisor.
- - - - A contract provision will not be construed as a condition precedent in the absence of language plainly requiring this construction.
      - Although a provision does not have to use the word “condition” to create a condition precedent, the contract language may inform the construction of the provision. For instance, if other contract provisions contain language identifying them as "conditions precedent," the absence of this language in another provision may indicate that that provision was not intended as a condition precedent. If there is doubt about whether a contract provision creates a condition precedent or a promise, then the provision will be construed to create a promise.
      - Where language in a contract is ambiguous as to whether the contract contains an express condition precedent or a promise, the court will determine the parties’ intent by examining the entire contract, circumstances surrounding the contract’s formation, the parties’ subsequent conduct, and the reasonableness of the parties’ respective interpretations.
      - Where a contract contains a condition that condition must occur before performance is required.
      - Conditions Precedent vs. Conditions Subsequent
        
        When we classify conditions as express, implied-in-fact, or constructive, the classification has to do with how the condition arose (by explicit agreement of the parties, as implied by their conduct, or implied in law).
        
        A condition is precedent if an event must occur before the performance is due.
        
        A condition is subsequent if the performance obligation is due but will cease to exist upon the occurrence of the specified event. [812]
  - - - When it is a condition of an obligor's duty that he be satisfied with respect to the obligee's performance or with respect to something else, and it is practicable to determine whether a reasonable person in the position of the obligor would be satisfied, an interpretation is preferred under which the condition occurs if such a reasonable person in the position of the obligor would be satisfied.
  - - - When one party’s performance under a contract is dependent on the prior performance of the other party, the other party’s performance is a condition precedent and performance will be excused unless the condition is satisfied.
      - A party has no obligation to perform a promise that is conditioned upon the other party’s performance when the other party failed to perform even though the other party’s failure to perform is excused and is not a breach of contract.
    - - UCC §234. Order of Performances
        
        1) Where all or part of the performances to be exchanged under an exchange of promises can be rendered simultaneously, they are to that extent due simultaneously, unless the language or the circumstances indicate to the contrary. [838]
    - - If a party substantially performs its obligations under a contract, that party will not be forced to bear the replacement cost needed to fully comply with the agreement but instead will owe the non-breaching party the difference in value between full performance and the performance received.
    - - The doctrine of substantial performance was developed in the context of a builder’s breach of a construction contract to deal with the potentially harsh effects of constructive conditions.
      - Outside of this context, courts apply a similar approach that revolves around whether one party has materially and totally breached the contract.
      - Any breach of contract entitles the nonbreaching party to sue for damages. However, an immaterial breach of contract has precisely the same effect as substantial performance. Although the breaching party is liable for damages, the nonbreaching party must continue to perform its own duties.
      - Conversely, a material breach entitles the nonbreaching party not just to sue for damages, but to temporarily stop its own performance and wait to see whether the breaching party can cure the defect.
      - However, if a material breach is not cured (or cannot be cured), it becomes material and total, which means that the nonbreaching party can both recover damages and treat the contract as broken, withholding any remaining performance.
      - According to the Restatement (Second) of Contracts, courts decide (1) whether a breach is material and (2) if so, whether it is material and total, by examining several factors: [846-47]
        
        R2C 241 Circumstances in determining whether failure is material
        
        In determining whether a failure to render or to offer performance is material, the following circumstances are significant:
        
        the extent to which the injured party will be deprived of the benefit which he reasonably expected;
        
        the extent to which the injured party can be adequately compensated for the part of that benefit of which he will be deprived;
        
        the extent to which the party failing to perform or to offer to perform will suffer forfeiture;
        
        the likelihood that the party failing to perform or to offer to perform will cure his failure, taking account of all the circumstances including any reasonable assurances;
        
        the extent to which the behavior of the party failing to perform or to offer to perform comports with standards of good faith and fair dealing.
        
        R2C 242 Cirumstances significant in determining when remaining duties are dischged
        
        In determining the time after which a party's uncured material failure to render or to offer performance discharges the other party's remaining duties to render performance under the rules stated in [R2C § 237 and R2C § 238], the following circumstances are significant:
        
        those stated in [R2C § 241];
        
        the extent to which it reasonably appears to the injured party that delay may prevent or hinder him in making reasonable substitute arrangements;
        
        the extent to which the agreement provides for performance without delay, but a material failure to perform or to offer to perform on a stated day does not of itself discharge the other party's remaining duties unless the circumstances, including the language of the agreement, indicate that performance or an offer to perform by that day is important.
      - fraught with peril
        
        Repudiation is one of the weapons available to an injured party in event the other contractor has committed a material breach. But the injured party’s determination that there has been a material breach, justifying his own repudiation, is fraught with peril, for should such determination, as viewed by a later court in the calm of its contemplation, be unwarranted, the repudiator himself will have been guilty of material breach and himself have become the aggressor, not an innocent victim. [850]
      - Time of Essence
        
        A contract making time of the essence typically contains express language stating that the contract is void if performance is late. In the absence of express language, the court will look at the parties’ intentions, the circumstances surrounding the contract, and the subject matter of the contract to determine if time is of the essence. Courts are generally reluctant to find that time is of the essence in construction contracts unless there is express language because construction contracts are subject to delays
        
        Failure to complete in time usually leads to damages
      - R2C §240. Part Performances as Agreed Equivalents
        
        If the performances to be exchanged under an exchange of promises can be apportioned into corresponding pairs of part performances so that the parts of each pair are properly regarded as agreed equivalents, a party’s performance of his part of such a pair has the same effect on the other’s duties to render performance of the agreed equivalent as it would have if only that pair of performances had been promised. [856]
      - UCC § 2-612. “Installment Contract”; Breach.
        
        (1) An "installment contract" is one which requires or authorizes the delivery of goods in separate lots to be separately accepted, even though the contractcontains a clause "each delivery is a separate contract" or its equivalent.
        
        (2) The buyer may reject any installment which is non-conforming if the non-conformity substantially impairs the value of that installment and cannot be cured or if the non-conformity is a defect in the required documents; but if the non-conformity does not fall within subsection (3) and the sellergives adequate assurance of its cure the buyer must accept that installment.
        
        (3) Whenever non-conformity or default with respect to one or more installments substantially impairs the value of the whole contract there is a breach of the whole. But the aggrieved party reinstates the contract if he accepts a non-conforming installment without seasonably notifying of cancellationor if he brings an action with respect only to past installments or demands performance as to future installments.
      - § 2-601. Buyer's Rights on Improper Delivery.
        
        § 2-602. Manner and Effect of Rightful Rejection.
        
        § 2-606. What Constitutes Acceptance of Goods.
        
        § 2-607. Effect of Acceptance; Notice of Breach; Burden of Establishing Breach After Acceptance; Notice of Claim or Litigation to Person Answerable Over.
      - UCC § 2-608. Revocation of Acceptance in Whole or in Part
        
        (1) The buyer may revoke his acceptance of a lot or commercial unit whose non-conformity substantially impairs its value to him if he has accepted it
        
        (a) on the reasonable assumption that its non-conformity would be cured and it has not been seasonably cured; or
        
        (b) without discovery of such non-conformity if his acceptance was reasonably induced either by the difficulty of discovery before acceptance or by the seller's assurances.
        
        (2) Revocation of acceptance must occur within a reasonable time after the buyer discovers or should have discovered the ground for it and before any substantial change in condition of the goods which is not caused by their own defects. It is not effective until the buyer notifies the seller of it.
        
        (3) A buyer who so revokes has the same rights and duties with regard to the goods involved as if he had rejected them.
  - - - Implied in every contract is a condition to cooperate and one party’s failure to cooperate will excuse the other party’s nonperformance.
      - NOTE ON GOOD FAITH
        
        Concepts of good faith, cooperation, and prevention are closely related. When one party actively attempts to torpedo the contractual relationship, the court may find a material breach of an implied promise (covenant):
        
        (a) not to prevent the other party from performing;
        
        (b) to cooperate in ensuring performance is achieved; or
        
        (c) to act in good faith. [873
    - - A condition of performance in a contract may be excused without reason if its requirement will involve extreme forfeiture or penalty, and its existence or occurrence forms no essential part of the exchange for the promisor’s performance.
      - A contractual provision requiring notice as a condition precedent to recovery is not contrary to public policy.
    - - As applied to contracts, waiver is a voluntary relinquishment of a known right.
      - A party who has a duty to perform and who changes its position as a result of the waiver may enforce the waiver.
      - “‘[W]aiver by estoppel’ exists when the acts and conduct of a party are inconsistent with an intent to claim a right, and have been such as to mislead the other party to his prejudice and thereby estop the party having the right from insisting upon it.”
      - “Waiver by estoppel allows a party’s inconsistent conduct, rather than a party’s intent, to establish a waiver of rights.” [893]
      - UCC § 2-209. Modification, Rescission and Waiver.
        
        (5) A party who has made a waiver affecting an executory portion of the contract may retract the waiver by reasonable notification received by the other party that strict performance will be required of any term waived, unless the retraction would be unjust in view of a material change of position in reliance on the waiver.
    - - IMpossibility of performance can excuse the performance of conditions of the contract
      - courts look to impossibility factors to help decide resulting liabilities
- - - - that courts define “agreement” objectively (focusing on a party’s words and conduct) rather than subjectively (trying to determine what a party was actually thinking).
      - Sometimes, parties manifest assent when an offeror makes a formal offer that the offeree may accept.
      - In addition, parties can manifest assent through their conduct. [7]
      - mutual manifestations of assent…. is a complex concept
    - - (2) A manifestation of mutual assent may be made even though neither offer nor acceptance can be identified and even though the moment of formation cannot be determined.
    - - A non-breaching party's claim for being placed in a position similar to the one he would have been in if the breach had not occurred, such as through the recovery of out-of-pocked expenses
    - - If words are evidently no more than a boast or an explosion of wrath, so that no reasonable person would be justified in taking them literally, no contract will result from the putative offeree's acceptance.
    - - Courts routinely uphold clickwrap agreements for the principal reason that the user has affirmatively assented to the terms of agreement by clicking “I agree.”
      - Because no affirmative action is required by the website user to agree to the terms of a contract other than his or her use of the website, the determination of the validity of the browsewrap contract depends on whether the user has actual or constructive knowledge of a website’s terms and conditions. [17]
    - - Inquiry
        
        By being aware of the ability to inqire into something they have recieved notice of that something
      - actual
        
        actual notice and awareness of something
      - Reasonable Conspicuousness
        
        A reasonable person in that situation should have noticed it
    - - Bilateral -- promise for a promise
      - Unilateral -- promise for performance
    - - offer,
      - acceptance,
      - contractual capacity,
      - consideration (the bargained for legal benefit and/or detriment),
      - a manifestation of mutual assent and
      - legality
    - - an enforceable contract requires mutual assent as to sufficiently definite essential terms
    - - Implied in Fact- parties meeting of the minds shown via circumstances and contract can be inferred to exist
      - Implied in Law - Law says its a contract so it is
      - Express- assent to contract terms via offer and acceptance
  - - - offers become agreements if they are accepted
      - preliminary negotiations are not offers and thus cannot give rise to an agreeement even if they are accepted
      - A preliminary negotiation occurs if the person who hears or reads a communication “knows or has reason to know that the person making it does not intend to conclude a bargain until he has made a further manifestation of assent.” Restatement (Second) of Contracts §26. [37]
      - When negotiators say that agreement is subject to a more definitive document, Illinois treats this as demonstrating intent not to be bound until that document has been prepared and signed.
      - Thus parties may reach agreement on elements A, B, and C, with more negotiation required on D and E. If elements D and E are essential to the mix, Illinois does not bind the parties to A, B, or C alone. Should agreement on essential elements fail, it is a failure of negotiation not performance. [40]
    - - Advertisements are generally viewed as invitations to offer until accepted by the seller
      - The authorities…emphasize that, where the offer is clear, definite, and explicit, and leaves nothing open for negotiation, it constitutes an offer, acceptance of which will complete the contract.
      - Modification
        
        while an advertiser has the right at any time before acceptance to modify his offer, he does not have the right, after acceptance, to impose new or arbitrary conditions not contained in the published offer
      - Deceptive Practices
        
        A bait and switch advertisement is a solicitation for the sale of a product that the seller does not really plan to sell.
    - - Further, a court may find that, even though no writing is generally required under the law for the particular type of agreement at issue, the parties did not intend to be bound until a writing was executed.
      - in some jd's a binding oral contract may exist even though the parties intend to memorialize their agreement in a fully executed document.
      - On the other hand, the parties can make the execution of a written document a condition precedent to the birth of a binding contract.
      - if one party intends to be bound via written document IT MUST BE BOUND VIA WRITTEN DOCUMENT
      - FACTORS
        
        In ascertaining whether the parties intended to be bound prior to execution of a written document, the court should consider the following factors:
        
        whether the contract is of a class usually found to be in writing;
        
        whether it is of a type needing a formal writing for its full expression;
        
        whether it has few or many details;
        
        whether the amount is large or small;
        
        whether the contract is common or unusual;
        
        whether all details have been agreed upon or some remain unresolved; and
        
        whether the negotiations show a writing was discussed or contemplated. [49-50]
  - - - moment of acceptance fixes the terms of the contract
      - parties can only mutually agree to changes after unless the contract specifies that one party would be allowed to change the terms
    - - R2C §50. Acceptance of Offer Defined; Acceptance by Performance; Acceptance by Promise
        
        (1) Acceptance of an offer is a manifestation of assent to the terms thereof made by the offeree in a manner invited or required by the offer.
        
        Acceptance by performance
        
        (2) Acceptance by performance requires that at least part of what the offer requests be performed or tendered and includes acceptance by a performance which operates as a return promise.
        
        Acceptance by a promise
        
        (3) Acceptance by a promise requires that the offeree complete every act essential to the making of the promise. [53]
      - Shrinkwrap licenses are enforceable unless their terms are objectionable on grounds applicable to contracts in general (for example, if they violate a rule of positive law, or if they are unconscionable).
      - A shrink wrap license is an end user agreement, concerning the use of a copyright work, that is enclosed with software in plastic-wrapped packaging. It includes pre-drafted terms and conditions of sale that consumers are required to agree before unpacking and using the work, usually a software product.
      - a contract includes only the terms on which the parties have agreed.
        One cannot agree to hidden terms, unless agreement includes agreement to those terms
        
        [UCC] §2-204(1): “A contract for sale of goods may be made in any manner sufficient to show agreement, including conduct by both parties which recognizes the existence of such a contract.”
        
        a vendor, as master of the offer, may invite acceptance by conduct, and may propose limitations on the kind of conduct that constitutes acceptance. A buyer may accept by performing the acts the vendor proposes to treat as acceptance
      - Where an offer unambiguously states the method in which it can be accepted, a binding contract will only be formed if the offer is accepted exactly as stated.
        
        § 2-206. Offer and Acceptance in Formation of Contract.
        
        (a) an offer to make a contract shall be construed as inviting acceptance in any manner and by any medium reasonable in the circumstances;
    - - contracts are generally construed against the party who drafted the document
    - - [I]f the offeror specifies no mode of acceptance, the law requires no more than that the mode adopted shall be in accord with the usage and custom of men in similar cases.
      - If proof of such usage and custom is wanting or is uncertain, the court must consider probable convenience and results and then help by its decision to establish a custom for the future and a rule of law.
      - the offer and surrounding circumstances are silent as to permissible modes of acceptance, the law requires only that there be some clear and unmistakable expression of the offeree’s intention to accept.
    - - § 69. Acceptance By Silence Or Exercise Of Dominion
      - (1) Where an offeree fails to reply to an offer, his silence and inaction operate as an acceptance in the following cases only:
      - (a) Where an offeree takes the benefit of offered services with reasonable opportunity to reject them and reason to know that they were offered with the expectation of compensation.
      - (b) Where the offeror has stated or given the offeree reason to understand that assent may be manifested by silence or inaction, and the offeree in remaining silent and inactive intends to accept the offer.
      - (c) Where because of previous dealings or otherwise, it is reasonable that the offeree should notify the offeror if he does not intend to accept.
      - (2) An offeree who does any act inconsistent with the offeror's ownership of offered property is bound in accordance with the offered terms unless they are manifestly unreasonable. But if the act is wrongful as against the offeror it is an acceptance only if ratified by him.
      - Course of performance
        
        A "course of performance" is a sequence of conduct between the parties to a particular transaction that exists if: (1) the agreement of the parties with respect to the transaction involves repeated occasions for performance by a party; and (2) the other party, with knowledge of the nature of the performance and opportunity for objection to it, accepts the performance or acquiesces in it without objection.
      - Course of Dealing
        
        A "course of dealing" is a sequence of conduct concerning previous transactions between the parties to a particular transaction that is fairly to be regarded as establishing a common basis of understanding for interpreting their expressions and other conduct.
      - Usage of Trade
        
        "usage of trade" is any practice or method of dealing having such regularity of observance in a place, vocation, or trade as to justify an expectation that it will be observed with respect to the transaction in question. The existence and scope of such a usage must be proved as facts. If it is established that such a usage is embodied in a trade code or similar record, the interpretation of the record is a question of law.
      - Qui tacet consentire videtur
        
        A party who is silent appears to consent
      - An offeree’s silence may be deemed to be consent to a contract when the offeree has a duty to respond to an offer and fails to act in the face of this duty.
      - An offeree’s silence may also be treated as consent to a contract when the party retains the benefit offered. [79-80]
    - - Offeree must know of the offer to accept it
      - if offer performed by governmental entity, any citizen is entitled to the reward with knowlege or not
    - - By the provisions of the Restatement of the Law of Contracts it is expressly provided that there is a presumption that the offer is to enter into bilateral contract.
      - “In case of doubt it is presumed that an offer invites the formation of a bilateral contract by an acceptance amounting in effect to a promise by the offeree to perform what the offer requests, rather than the formation of one or more unilateral contracts by actual performance on the part of the offeree.” [88]
  - - - (1) An offeree’s power of acceptance may be terminated by
      - (a) rejection or counter-offer by the offeree, or
      - (b) lapse of time, or
      - (c) revocation by the offeror, or
      - (d) death or incapacity of the offeror or offeree.
      - (2) In addition, an offeree’s power of acceptance is terminated by the non-occurrence of any condition of acceptance under the terms of the offer. [90]
    - - See Restatement (Second) of Contracts §42 (“An offeree’s power of acceptance is terminated when the offeree receives from the offeror a manifestation of an intention not to enter into the proposed contract.”). [90]
      - Offeror needs to inform the offferee that the offeror is no longer willing to go through with the exchange
      - Any clear manifestation of unwillingness to enter into the proposed bargain is sufficient
      - Restatement (Second) of Contracts § 43
        
        An offeree's power of acceptance is terminated when
        
        the offeror takes definite action inconsistent with an intention to enter into the proposed contract and
        
        the offeree acquires reliable information to that effect.
        
        .
        
        d. Definite action; reliable information.
        
        [M]ere negotiations with a third person, or even a definite offer to a second offeree, may be consistent with an intention on the part of the offeror to honor an acceptance by the original offeree.
        
        Moreover, a mere rumor does not terminate the power of acceptance, if the offeree disbelieves it and is reasonable in doing so, even though the rumor is later verified.
    - - Option contract
        
        Under the common law, an option is an agreement in which the offeror promises not to revoke an offer in return for the offeree providing consideration.
        
        the offeror cannot revoke during the option period.
        
        In addition, a rejection or counteroffer by the offeree does not necessarily terminate the offer. [95]
      - UCC§ 2-205. Firm Offers.
        
        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.
        
        If the parties fulfil the requirements of §2-205, they can make an offer irrevocable even if the offeree does not provide a valuable right or item in exchange for the offeror’s promise not to revoke. [95]
        
        Applies to leases
    - - a tender of money
        
        A tender means an offer to perform, but a tender of money, in strict legal terms, means much more than a mere offer to pay.
        
        It must be accompanied by the current presentment of the exact amount due in official currency.
        
        Checks, even certified or cashier’s checks, are not sufficient. (But see §2-511 of the UCC.) [105]
      - UCC § 2-511. Tender of Payment by Buyer; Payment by Check.
        
        (2) Tender of payment is sufficient when made by any means or in any manner current in the ordinary course of business unless the seller demands payment in legal tender and gives any extension of time reasonably necessary to procure it.
      - MODERN APPROACH TO UNILATERAL CONTRACTS
        
        Less focused on will theory aka being able to revoke offer halfway through performance if offer was based on completion. Became more focused on fairness and reasonable reliance
        
        R2C §32. Invitation of Promise or Performance
        
        In case of doubt an offer is interpreted as inviting the offeree to accept either by promising to perform what the offer requests or by rendering the performance, as the offeree chooses. [106]
        
        R2C §45. Option Contract Created by Part Performance or Tender
        
        (1) Where an offer invites an offeree to accept by rendering a performance and does not invite a promissory acceptance, an option contract is created when the offeree tenders or begins the invited performance or tenders a beginning of it.
        
        (2) The offeror’s duty of performance under any option contract so created is conditional on completion or tender of the invited performance in accordance with the terms of the offer. [106]
        
        R2C §62. Effect of Performance by Offeree Where Offer Invites Either Performance or Promise
        
        (1) Where an offer invites an offeree to choose between acceptance by promise and acceptance by performance, the tender or beginning of the invited performance or a tender of a beginning of it is an acceptance by performance.
        
        (2) Such an acceptance operates as a promise to render complete performance. [107]
        
        , §62 governs agreements that are similar to unilateral contracts, but aren’t true unilateral contracts.
        Specifically, it applies when the offer can be accepted either by promise or performance, and instead of promising, the offeree begins to perform.
    - - R2C §41. Lapse of Time
        
        (1) An offeree’s power of acceptance is terminated at the time specified in the offer, or, if no time is specified, at the end of a reasonable time.
        
        (2) What is a reasonable time is a question of fact, depending on all the circumstances existing when the offer and attempted acceptance are made.
        
        (3) Unless otherwise indicated by the language or the circumstances, and subject to the rule stated in §49, an offer sent by mail is seasonably accepted if an acceptance is mailed at any time before midnight on the day on which the offer is received. [109]
      - Ordinarily, an offer made by one to another in a face to face conversation is deemed to continue only to the close of their conversation, and cannot be accepted thereafter. [113]
      - RISK OF LOSS
        
        Under §2-509(3) of the UCC, title is no longer important—see §2-401—and risk of loss is generally determined by other factors such as possession or the parties’ agreement. [116]
      - Restatement (Second) of Contracts §70
        
        According to the Restatement (Second) of Contracts §70, “[a] late or otherwise defective acceptance may be effective as an offer to the original offeror [i.e., a counter-offer], but his silence operates as an acceptance in such a case only as stated in §69.” [116]
    - - R2C §48. Death or Incapacity of Offeror or Offeree
        
        An offeree’s power of acceptance is terminated when the offeree or offeror dies or is deprived of legal capacity to enter into the proposed contract. [116]
    - - R2C §38. Rejection
        
        (1) An offeree’s power of acceptance is terminated by his rejection of the offer, unless the offeror has manifested a contrary intention.
        
        (2) A manifestation of intention not to accept an offer is a rejection unless the offeree manifests an intention to take it under further advisement. [117]
    - - The rule that a contract is complete upon deposit of the acceptance in the mails, hereinbefore referred to as “deposited acceptance rule”
      - “Where the circumstances are such that it must have been within the contemplation of the parties that, according to the ordinary usage of mankind, the post might be used as a means of communicating the acceptance of an offer, the acceptance is complete as soon as it is posted.”
      - In the fact patterns where the offeree takes contradictory actions (mails a rejection then phones an acceptance, mails an acceptance then phones a rejection, mails a rejection then mails an acceptance, etc.) the courts adopt whatever result will please the innocent party, the original offeror.
      - To be entitled to the benefit of the mailbox rule, however, a party must still demonstrate that the mailing was “properly prepared, addressed, stamped, and mailed.”
      - When an offeree tries to accept an offer under an option contract or a firm offer, the mail box rule does not apply.
        The acceptance must be received within the option period to be effective.
      - International sales are different : acceptance not effective until received
    - - MIRROR IMAGE RULE
        
        One party makes an offer, and the other party responds with a document that claims to accept the offer but changes its terms.
        
        Under the common law, the analysis is straightforward. Under what is known as the “mirror image rule,” an acceptance must mirror the offer exactly. Adding or deleting any terms makes a reply to the offer not an acceptance, but a counteroffer. See Restatement (Second) of Contracts §§36(1)(a), 37.
        
        However, UCC §2-207 abandons the mirror image rule and adopts a much more nuanced approach. [125]
        
        Under UCC 2-207(3), where two merchants exchange conflicting forms and one merchant expressly conditions acceptance on the other’s assent to his terms, a contract can still be formed based on the parties’ subsequent conduct, but the parties will only be bound to the terms they agreed upon.
        
        Under the knockout rule, if an acceptance contains terms that are additional to or different from those in the offer, the conflicting terms in both the offer and acceptance are replaced with neutral provisions from the Uniform Commercial Code.
        
        Additional or different terms provided in the acceptance do not become terms of the contract unless acceptance is made expressly conditional upon acceptance of the additional terms or the non-merchant offeror expressly agrees to the additional terms.
      - MIXED CONTRACTS FOR GOODS AND SERVICES
        
        Although the U.C.C. governs the sale of goods, the U.C.C. also applies to certain mixed contracts for goods and services.
        
        Whether a particular transaction is governed by the U.C.C., rather than the common law or other statutory law, hinges on the predominant purpose of the transaction, that is, whether the contract primarily concerns the furnishing of goods or the rendering of services. [127]
        
        Are goods incidentally involved or is labor incidentally involved? if so other factor is predominant
    - - CORBIN ON CONTRACTS §29
        
        The parties may not give verbal expression to such vitally important matters as
        price,
        place and time of delivery,
        time of payment,
        amount of goods,
        and yet they may actually have agreed upon them.
        This may be shown by their antecedent expression, their past action and custom, and other circumstances. [151]
      - construction of contract
        
        The UCC requires the courts to look to the following matters as aids for construction of the contract:
        
        usage of trade, meaning the custom within any given industry;
        
        course of dealing, meaning the parties’ past interactions with each other; and
        
        course of performance, meaning what the parties do while performing this one contract (what the common law called practical construction).
        
        The UCC has a number of provisions designed to fill in the blanks left in the contract. Read §§
        
        2-305 (Open Price Term),
        
        (1) The parties if they so intend can conclude a contract for sale even though the price is not settled. In such a case the price is a reasonable price at the time for delivery if
        
        (a) nothing is said as to price; or
        
        (b) the price is left to be agreed by the parties and they fail to agree; or
        
        (c) the price is to be fixed in terms of some agreed market or other standard as set or recorded by a third person or agency and it is not so set or recorded….
        
        2-306 (Output, Requirements and Exclusive Dealings),
        
        2-307 (Delivery in Single or Several Lots),
        
        2-308 (Absence of Specified Place for Delivery), and
        
        2-309 (Absence of Specific Time Provisions). [151]
        
        The one term that has to be in the contract is quantity; the Code will not supply it.
- - - - the buyer should be awarded both expectancy damages … and consequential damages [303]
      - § 347. Measure Of Damages In General
        
        Subject to the limitations stated in §§ 350-53, the injured party has a right to damages based on his expectation interest as measured by
        
        (a) the loss in the value to him of the other party's performance caused by its failure or deficiency, plus
        
        (b) any other loss, including incidental or consequential loss, caused by the breach, less
        
        (c) any cost or other loss that he has avoided by not having to perform.
      - Expectancy damages seek to put the plaintiff back in the position they would have been in if the contract had been performed and no breach occurred. Reliance damages seek to put the plaintiff in the position she would have been in if she had not entered into the contract
    - - When one party breaches a contract, the non-breaching party may recover damages based on the difference between the value of the contract as fully performed and the actual value of the non-breaching party’s present condition, plus any incidental damages reasonably foreseeable to all parties at the time of contract formation.
      - The measure of damages for breach of a contract involving the sale of personal property readily available in the marketplace is the difference between the contract price and the market price at the time the breach occurred.
      - Regardless of any agreement of the parties, damages awarded for breach of an agreement to perform remedial work on property should normally be measured by the reasonable cost of performance of the work. However, when the contract provision breached is merely incidental to the main purpose in view, and where the economic benefit which would result to the owner from full performance is grossly disproportionate to the cost of performance, damages should instead be limited to the diminution in value resulting to the premises because of the non-performance.
      - expectation value
        
        Two formulas are most often used in the calculation of the damages in such a breach.
        
        One is as follows:
        
        Lost value
        
        plus Other loss
        
        minus Costs avoided
        
        minus Loss avoided
        
        The other formula … is:
        
        Unpaid profit (total price - total cost - price paid to date)
        
        plus Reliance costs (expenses to date)
        
        plus Other loss
        
        minus Loss avoided
    - - Unlike expectation damages, which give the injured party the benefit of the bargain, reliance damages restore the injured party to the position the plaintiff would have been in if the contract had never been made. [320-21]
      - A nonbreaching party may recover expenditures in lieu of lost profits, including those expenditures incurred both before and after the agreement was made.
        
        [T]he position of the court in allowing the recovery of costs expended before contracting is not the majority view in this country.
      - NOTE ON THE PRESUMPTION OF BREAKING EVEN
        
        If the expectancy is too difficult to prove, the plaintiff is entitled to recover out-of-pocket expenses unless the defendant can prove that the contract was a losing one and that the plaintiff would not have made enough from the contract to make up these expenditures.
        
        Thus, the courts in effect are indulging in a presumption that the plaintiff will “break even”; that the expectancy would have been at least the amount of the expenditures.
        
        Reasonable reliance and restitution expenses are awarded on “the assumption that the value of the contract would at least have covered the outlay.”
        
        If the defendant can carry the burden of showing that the contract was really a losing one, the court will deduct the loss from the plaintiff’s outlay. [329]
      - NOTE ON DAMAGES FOR PROMISSORY ESTOPPEL CLAIMS
        
        The majority rule is that “court[s] may award [either] expectation, reliance, or restitutionary damages for promissory estoppel claims.”
        
        In some states, however, “[a] successful promissory[]estoppel claimant’s recovery…is limited to reliance damages, that is, the party may recover only the amount necessary to restore it to the position it would have occupied if it had not relied on the adverse party’s promise.” [330]
    - - Both the loss of value and the consequential portions of a damage award are subject to various limitations.
      - Of primary importance are the doctrines of
      - certainty,
      - foreseeability, and
      - avoidability. [331]
      - UCC § 2-715.Buyer's Incidental and Consequential Damages.
        
        Incidental damages resulting from the seller's breach include
        
        expenses reasonably incurred in inspection, receipt, transportation and care and custody of goods rightfully rejected,
        
        any commercially reasonable charges, expenses or commissions in connection with effecting cover and
        
        any other reasonable expense incident to the delay or other breach.
        
        Consequential damages resulting from the seller's breach include
        
        a) any loss resulting from general or particular requirements and needs of which the seller at the time of contracting had reason to know and which could not reasonably be prevented by cover or otherwise; and
        
        (b) injury to person or property proximately resulting from any breach of warranty.
      - Certainty
        
        Requested relief can be too speculative because there is too much uncertainty as to either
        
        (1) the fact that the breach caused the type of injury that plaintiff alleges (a “causation” limitation);
        
        (2) the extent to which the plaintiff suffered from the breach (the dollar amount of the damage caused); or
        
        (3) both the causation and amount. [331]
        
        a party seeking reliance damages under §349 [p. 321] has a relatively low bar to clear to establish causation and … once it makes this showing, the burden shifts to the breaching party to prove any reduction in those damages [333]
        
        nominal damages can … be the basis for an award of punitive damages [339]
      - Foreseeability
        
        When one party breaches a contract, the other party may recover all damages that are reasonably foreseeable to both parties at the time of making the contract, as well as damages stemming from any special circumstances, provided those circumstances were communicated to and known by all parties at contract formation.
        
        § 351. Unforeseeability And Related Limitations On Damages
        
        (1) Damages are not recoverable for loss that the party in breach did not have reason to foresee as a probable result of the breach when the contract was made.
        
        (2) Loss may be foreseeable as a probable result of a breach because it follows from the breach
        
        (a) in the ordinary course of events, or
        
        (b) as a result of special circumstances, beyond the ordinary course of events, that the party in breach had reason to know.
        
        (3) A court may limit damages for foreseeable loss by excluding recovery for loss of profits, by allowing recovery only for loss incurred in reliance, or otherwise if it concludes that in the circumstances justice so requires in order to avoid disproportionate compensation.
        
        General damages versus Consequential damages
        
        General damages in the case of accepted goods (such as occurred here) are the actual difference in value between the goods as promised and the goods as received.
        
        Consequential damages are generally understood to be other damages which naturally and proximately flow from the breach and include three types of lost profit damages: (1) lost primary profits; (2) lost secondary profits; and (3) loss of prospective profits, also commonly referred to as good will damages.
        
        Lost primary profits are the difference between what the buyer would have earned from reselling the goods in question had there been no breach and what was earned after the breach occurred.
        
        The loss of secondary profits includes the profits typically made on products sold in connection with the initial product.
        
        Good will damages involve the loss of future sales and business reputation
        
        UCC § 2-608.Revocation of Acceptance in Whole or in Part.
        
        (1) The buyer may revoke his acceptance of a lot or commercial unit whose non-conformity substantially impairs its value to him if he has accepted it
        
        (a) on the reasonable assumption that its non-conformity would be cured and it has not been seasonably cured; or
        
        (b) without discovery of such non-conformity if his acceptance was reasonably induced either by the difficulty of discovery before acceptance or by the seller's assurances….
      - Avoidability
        
        When a non-breaching party in a contract for services receives notice of another party’s breach, the non-breaching party must treat the contract as broken when notice is received, cease performance, and sue for any losses sustained from the breach as well as profits that would have been realized upon performance.
        
        The avoidability limitation does not create a duty as that word is usually meant. The only penalty for not mitigating is that the plaintiff cannot recover for damages that could have been reasonably avoided.
        
        [T]his doctrine of avoidability is a logical adjunct to the principle of protecting the expectation interest; the non-breaching party ought not to be overcompensated.
        
        UCC § 2-703. Seller's Remedies in General.
        
        Where the buyer wrongfully rejects or revokes acceptance of goods or fails to make a payment due on or before delivery or repudiates with respect to a part or the whole, then with respect to any goods directly affected and, if the breach is of the whole contract (Section 2-612), then also with respect to the whole undelivered balance, the aggrieved seller may
        
        (a) withhold delivery of such goods;
        
        (b) stop delivery by any bailee as hereafter provided (Section 2-705);
        
        (c) proceed under the next section respecting goods still unidentified to the contract;
        
        (d) resell and recover damages as hereafter provided (Section 2-706);
        
        (e) recover damages for non-acceptance (Section 2-708) or in a proper case the price (Section 2-709);
        
        (f) cancel.
        
        UCC § 2-704. Seller's Right to Identify Goods to the Contract Notwithstanding Breach or to Salvage Unfinished Goods.
        
        (1) An aggrieved seller under the preceding section may
        
        (a) identify to the contract conforming goods not already identified if at the time he learned of the breach they are in his possession or control;
        
        b) treat as the subject of resale goods which have demonstrably been intended for the particular contract even though those goods are unfinished.
        
        (2) Where the goods are unfinished an aggrieved seller may in the exercise of reasonable commercial judgment for the purposes of avoiding loss and of effective realization either complete the manufacture and wholly identify the goods to the contract or cease manufacture and resell for scrap or salvage value or proceed in any other reasonable manner.
        
        UCC § 2-709. Action for the Price.
        
        (1) When the buyer fails to pay the price as it becomes due the seller may recover, together with any incidental damages under the next section, the price
        
        (a) of goods accepted or of conforming goods lost or damaged within a commercially reasonable time after risk of their loss has passed to the buyer; and
        
        (b) of goods identified to the contract if the seller is unable after reasonable effort to resell them at a reasonable price or the circumstances reasonably indicate that such effort will be unavailing.
        
        (3) After the buyer has wrongfully rejected or revoked acceptance of the goods or has failed to make a payment due or has repudiated (Section 2-610), a seller who is held not entitled to the price under this section shall nevertheless be awarded damages for non-acceptance under the preceding section.
        
        (2) Where the seller sues for the price he must hold for the buyer any goods which have been identified to the contract and are still in his control except that if resale becomes possible he may resell them at any time prior to the collection of the judgment. The net proceeds of any such resale must be credited to the buyer and payment of the judgment entitles him to any goods not resold.
      - Damages by Agreement
        
        R2C §356(1). Liquidated Damages and Penalties
        
        Damages for breach by either party may be liquidated in the agreement but only at an amount that is reasonable in the light of the
        
        anticipated or actual loss caused by the breach and
        
        the difficulties of proof of loss.
        
        A term fixing unreasonably large liquidated damages is unenforceable on grounds of public policy as a penalty. [375]
        
        The modern rule is “to look with candor, if not with favor” upon liquidated-damages provisions in contracts when those provisions were “deliberately entered into between parties who have equality of opportunity for understanding and insisting upon their rights.”
        
        “If the provision was reasonable at the time of formation and it bears a reasonable (not necessarily exact) relation to actual damages, the provision will be enforced.”
        
        A contractual provision disclaiming incidental and consequential damages will be upheld unless it is held to be unconscionable.
        
        R2C §355. Punitive Damages
        
        Punitive damages are not recoverable for a breach of contract unless the conduct constituting the breach is also a tort for which punitive damages are recoverable. [393]
        
        Punitives
        
        Punitive damages are appropriate in a breach of contract action when elements of fraud, malice, gross negligence or oppression are involved in the case.
      - Damages Under the Uniform Commercial Code
        
        Buyer’s Damages
        
        If the buyer has rightfully rejected or revoked acceptance or the seller never delivered the goods at all, the buyer’s actual damages are determined by either UCC §2-712 or 2-713.
        
        If the buyer “covers” by acting reasonably and trying to find substitute goods from a different seller, §2-712 entitles the buyer to the difference between the cover price and the contract price.
        
        Conversely, if the buyer does not cover or covers in an unreasonable fashion (not shopping around hard enough or buying vastly superior substitute goods), §2-712 limits the buyer to the difference between the market price and the contract price.
        
        In either situation, the buyer may also be entitled to incidental and consequential damages under §2-715. (However, the amount of damages may be limited by provisions in the sales contract that set a maximum amount for damages. §§2-718, 2-719.) [399-400]
        
        Sellers Damages
        
        UCC § 2-706. Seller's Resale Including Contract for Resale
        
        Where the resale is made in good faith and in a commercially reasonable manner the seller may recover the difference between the resale price and the contract price together with any incidental damages allowed under the provisions of this Article (Section 2-710), but less expenses saved in consequence of the buyer’s breach.…
        
        (1).…[T]he seller may resell the goods concerned or the undelivered balance thereof.
  - - - Quasi-contract actions developed from the common law action of general assumpsit ….
      - The writ of general assumpsit was divided into different parts called the common counts, three of which are still in widespread use today. These theories of action are:
        
        Quantum meruit: the value of services rendered to another.
        
        Quantum valebant: the value of property delivered to another.
        
        Money had and received: money held by one person but belonging to another. [411]
      - UNJUST ENRICHMENT
        
        The three elements of an unjust-enrichment claim are as stated in Hill v. Cross Country Settlements, LLC, 936 A.2d 343, 351 (Md. 2007):
        
        A benefit conferred upon the defendant by the plaintiff;
        
        An appreciation or knowledge by the defendant of the benefit; and
        
        The acceptance or retention by the defendant of the benefit under such circumstances as to make it inequitable for the defendant to retain the benefit without the payment of its value.
        
        “A defendant, however, ‘is not unjustly enriched, and therefore not required to make restitution where the benefit was conferred by a volunteer or intermeddler.’” [413]
      - NOTE
        
        Under the Restatement of Restitution §116, “[a] person who has supplied things or services to another, although acting without the other’s knowledge or consent, is entitled to restitution if …
        
        the things or services were necessary to prevent the other from suffering serious bodily harm or pain [and] …
        
        it was impossible for the other to give consent.” [415]
      - Restatement (First) of Restitution § 116
        
        Comment b.
        
        [R]estitution is not permitted to one who has reason to believe that the person, if fully competent, would not, were he in a position to do so, be willing to accept the services.
        
        Thus a physician who has been summoned to attend an unconscious sick person and who, from his knowledge of the patient, knows that his own services or the services of any physician would not be acceptable, cannot recover for his services.
      - A N Bros. Corp. v. Total Quality Logistics, L.L.C., 2016-Ohio-549, ¶ 42, 59 N.E.3d 758, 770
        
        Though the elements of quantum meruit and unjust enrichment have been found to be identical, quantum meruit is a distinct claim or right of action.
        
        The difference is the manner in which damages are computed.
        
        “In unjust enrichment, damages are conferred in the amount the defendant benefitted. In quantum meruit, damages are the measure of the value of the plaintiff's services.”
    - - Restatement (Second) of Contracts § 371
        
        If a sum of money is awarded to protect a party's restitution interest, it may as justice requires be measured by either
        
        (a) the reasonable value to the other party of what he received in terms of what it would have cost him to obtain it from a person in the claimant's position, or
        
        (b) the extent to which the other party's property has been increased in value or his other interests advanced.
      - if the plaintiff has completed performance and the defendant’s breach is simply the failure to pay the agreed price, restitution is not a proper measure. [429]
    - - Where an employee voluntarily breaches a contract for labor by failing to continue the agreed employment, the employee is entitled under quantum meruit to the reasonable value of the services provided, unless the contract specifically provides otherwise.
      - Although Restatement (Second) of Contracts §374 does not accept willfulness of the breach as a limitation on restitution, other cases support doing so.
      - Farnsworth states that the argument against recovery is particularly strong where a party has breached for his own convenience or financial advantage.
      - Though in the typical quasi-contractual action the contract price is irrelevant, where suit is brought by a party who has materially breached, most courts have placed the contract price as a cap on the recovery. If the breaching plaintiff could recover more, we would encourage breach, which is never a good idea. Thus the most Howard can get here, if the court gives him anything, is $50,000.
  - - - A vendor of real estate is not entitled to specific performance upon default of a contract unless the property in question is so unique that money damages would not be an adequate remedy.
      - (1) Courts will not render a contract invalid if only one party retains a right of cancellation. (2) A court can grant specific performance if the court can determine with reasonable certainty the duty of each party and the conditions under which performance is due.
      - UCC § 2-716.Buyer's Right to Specific Performance or Replevin.
        
        (1) Specific performance may be decreed where the goods are unique or in other proper circumstances….
        
        Cf. REPLEVIN: A lawsuit to repossess personal property wrongfully taken or detained by the defendant, whereby the plaintiff gives security for and holds the property until the court decides who owns it.
      - Restatement (Second) of Contracts § 362
        
        Specific performance or an injunction will not be granted unless the terms of the contract are sufficiently certain to provide a basis for an appropriate order.
      - UCC § 2-709. Action for the Price
        
        (1) When the buyer fails to pay the price as it becomes due the seller may recover, together with any incidental damages under the next section, the price
        
        (a) of goods accepted or of conforming goods lost or damaged within a commercially reasonable time after risk of their loss has passed to the buyer; and
        
        (b) of goods identified to the contract if the seller is unable after reasonable effort to resell them at a reasonable price or the circumstances reasonably indicate that such effort will be unavailing….
      - Restatement (Second) of Contracts § 365
        
        Specific performance or an injunction will not be granted if the act or forbearance that would be compelled or the use of compulsion is contrary to public policy.
      - Restatement (Second) of Contracts § 366
        
        A promise will not be specifically enforced if the character and magnitude of the performance would impose on the court burdens in enforcement or supervision that are disproportionate to the advantages to be gained from enforcement and to the harm to be suffered from its denial.
      - Restatement (Second) of Contracts § 359
        
        (1) Specific performance or an injunction will not be ordered if damages would be adequate to protect the expectation interest of the injured party.
        
        (2) The adequacy of the damage remedy for failure to render one part of the performance due does not preclude specific performance or injunction as to the contract as a whole….
- - - - First, it prevents litigants from using parol evidence to supplement a fully integrated contract.
      - Second, the parol evidence rule bars parties from using parol evidence to contradict a written contact (even if it is only “partially” integrated). [536]
    - - (1) A binding integrated agreement discharges prior agreements to the extent that it is inconsistent with them.
      - (2) A binding completely integrated agreement discharges prior agreements to the extent that they are within its scope.… [536]
    - - Terms with respect to which the confirmatory memoranda of the parties agree or which are otherwise set forth in a writing intended by the parties as a final expression of their agreement with respect to such terms as are included therein may not be contradicted by evidence of any prior agreement or of a contemporaneous oral agreement but may be explained or supplemented:
      - (a) by course of dealing or usage of trade (Section 1-205) or by course of performance (Section 2-208); and
      - (b) by evidence of consistent additional terms unless the court finds the writing to have been intended also as a complete and exclusive statement of the terms of the agreement. [536-37]
    - - [T]he first step in the analysis is to determine whether a writing is either
      - (1) fully integrated (intended to be final and complete),
      - (2) partially integrated (intended to be final and complete with respect to some issues but not others), or
      - (3) unintegrated (oral and therefore not subject to the parol evidence rule).
      - When the written agreement is intended to be the entire agreement, parol evidence cannot be introduced to establish terms of the agreement and parol evidence cannot be introduced to establish whether or not the contract is intended to be the entire agreement.
      - Restatement (Second) of Contracts § 214 (1981)
        
        Agreements and negotiations prior to or contemporaneous with the adoption of a writing are admissible in evidence to establish
        
        (a) that the writing is or is not an integrated agreement;
        
        (b) that the integrated agreement, if any, is completely or partially integrated;
        
        (c) the meaning of the writing, whether or not integrated;
        
        (d) illegality, fraud, duress, mistake, lack of consideration, or other invalidating cause;
        
        (e) ground for granting or denying rescission, reformation, specific performance, or other remedy.
    - - Collateral Agreements
        
        the parol evidence rule is that it does not apply to collateral agreements: prior or contemporaneous understandings that are distinct from a subsequent written contract (even if that contract is fully integrated)
        
        The parol evidence rule does not apply to omitted provisions that one would not necessarily expect to see in the writing. [547]
        
        R2C §216. Consistent Additional Terms
        
        (1) Evidence of a consistent additional term is admissible to supplement an integrated agreement unless the court finds that the agreement was completely integrated.
        
        (2) An agreement is not completely integrated if the writing omits a consistent additional agreed term which is
        
        (a) agreed to for separate consideration, or
        
        (b) such a term as in the circumstances might naturally be omitted from the writing. [547]
        
        UCC §2-202 Final Written Expression: Parol or Extrinsic Evidence, cmt. 3
        
        If the additional terms are such that, if agreed upon, they would certainly have been included in the document in the view of the court, then evidence of their alleged making must be kept from the trier of fact. [548]
        
        Under the UCC, in ascertaining whether parties intended their contract to be completely integrated, a court will look beyond the four corners of the contract to the circumstances surrounding the transaction, including the words and actions of the parties.
      - Avoidance
        
        In the next chapter we will discuss some doctrines that allow a party to avoid the contract entirely (for reasons such as fraud or duress).
        
        Where this is the case, the parol evidence rule has no relevance and the reason for the avoidance is admissible in spite of a signed writing with an iron-clad merger clause. [570]
      - Oral Conditions Precedent
        
        Suppose the parties orally agree to be bound by a fully integrated written contract only if something happens, such as the price of oil stays above $60 per barrel or the zoning board approves an application to build a factory on a vacant lot.
        
        The parol evidence rule does not preclude a party from demonstrating that this event has not occurred and no written contract has come into existence. [571]
  - - - although parties cannot use parol evidence to contradict a written contract …, they can use parol evidence to explain an ambiguous written contract
      - the first skirmish in battles over contract interpretation usually revolves around whether a writing is ambiguous [574]
    - - When the parties have adopted a writing as a final expression of their agreement, interpretation is directed to the meaning of that writing in the light of the circumstances.
      - The circumstances for this purpose include the entire situation, as it appeared to the parties, and in appropriate cases may include facts known to one party of which the other had reason to know.
    - - R2C §201
        
        Restatement §201(1) governs contexts where the parties agree about what a term means. It acknowledges the primacy of the parties’ intent by allowing them to adopt idiosyncratic definitions of particular words or phrases …. [587]
        
        Restatement §201(2) deals with the common situation in which the parties understood language differently. It …. “codifies a rule based on concerns of fairness that prevents a party who knows that the other party has attached a different meaning to a term from taking advantage of the misunderstanding.” [588]
      - R2C canons of interpretation
        
        §202. Rules in Aid of Interpretation
        
        §203. Standards of Preference in Interpretation
        
        §206. Interpretation Against the Draftsman
        
        §207. Interpretation Favoring the Public
      - NOTE ON THE LAW OF WARRANTY IN THE SALE OF GOODS
        
        Warranties are of two basic types: warranties of title and warranties of quality.
        
        The warranty of title is basically what it sounds like, a guarantee that the seller will convey good title to the buyer at the time of sale. See UCC §2-312.
        
        Quality warranties are also divisible into two categories: express and implied warranties. [594]
        
        Under UCC §2-313, a seller creates an express warranty by making an affirmation of fact (“this is a new car”), describing the item (“when it arrives, it will be painted yellow”), making a promise relating to the goods (“if it doesn’t work, I’ll fix it”), or displaying a sample or model (“this is what it will look like”).
        
        The statement need not be in writing or even intended by the seller to be a warranty, but it must go to the “basis of the bargain.” This phrase means that it must contain enough substance to it that it might have played some part in the buyer’s decision to purchase. If so, the statement is presumed to be part of the basis of the bargain unless the seller can prove that the buyer did not rely on the statement. [594]
        
        Implied warranties are created by the legislature (and thus are often said to be “children of the law”) to fulfill the buyer’s typical expectations concerning the item purchased.
        
        The implied warranty of merchantability (UCC §2-31[4]) is basically a warranty that the goods will fulfill their usual functions.
        
        The implied warranty of fitness for a particular purpose (UCC §2-315) arises when the seller has reason to know of some special use the buyer has for the goods (“I need some boots for climbing Mt. Everest”) and this creates a warranty that the goods will fulfill that particular purpose. [594]
        
        However, sellers have several weapons against warranties.
        
        First, express warranties can fall prey to the parol evidence rule. As we have seen earlier in this chapter, a buyer cannot supplement a fully integrated contract with proof of what a seller said before the parties entered into the contract.
        
        Second, under UCC §2-316, sellers can disclaim (in other words, eliminate) implied warranties and buyers can forfeit implied warranty claims by failing to discover obvious defects. [594]