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Contracts 2 - Coggle Diagram

- - - - Elements:
        
        (1) Supervising event that makes performance as agreed impracticable. (2) Non-occurrence of the supervening event must have been a basic assumption of both parties on which the contract was made.( 3) Impracticability must have resulted without the fault, including negligence, of the party seeking to be excused. That party must not have assumed the risk of the occurrence of the supervening event.
        Foreseeability of the supervening event is evidence of the assumption of risk.
        
        The gravel excavation case is the paradigm case. There, it was 10-12x more expensive.
- - - - A third party has an enforceable right if the promised performance will be of pecuniary benefit to [the third party] and the contract is so expressed as to give the promisor reason to know that such benefit is contemplated by the promisee as one of the motivating causes of his making the contract. Vogan: Hayes (the one giving reports) knew the purpose of the reports was to benefit the Vogans. The primary question is whether the contract manifests an intent to benefit a third party, but this intent need not be to benefit a third party directly.
  - - - In a child support agreement, a child is not an intended beneficiary absent very special circumstances.
- - - - Arises when you compel a party to perform or pay damages.
        
        The assignee gains a new right and the assignor loses the right. Assignor's right is EXTINGUISHED. Unless expressly disclaimed, the right automatically assigned. Once you are assigned something, you cannot reject it--you become an obligor. The obligor does not have to accept and must perform!! Even if the assignor revokes, the obligor must carry it out. (The settlement case).
        
        assignor=gave away right.
        
        assignee=getting the right. Once it is assigned, the assignor has no rights.
        
        obligor=giving the right to the assignee. Cannot reject assignment. Must carry it out (even if assignor revokes).
  - - - a person who is subject to a duty of performance may properly “delegate” that duty, that is, may satisfy it by employing others to perform it for her.
        
        Personal service contracts cannot be delegated unless the other party consents. (Sally Beauty case). Think of hiring Beyonce and her substituting her duty to someone else.
        
        The UCC allows delegation UNLESS performance would be unsatisfactory. An obligee may have a substantial interest in having the original promisor perform. (Sally Beauty case).
        
        When a duty is delegated, it is like passing a cold. Passing it on does not mean getting rid of the duty, If a duty is not performed, the obligee has rights against the obligor AND delegator until performance is carried out (unless the obligee agrees to release obligor, which is called a novation & evidence of a novation must be SUPER CLEAR).
        
        obligor/delegator = the OG performer
        
        Delegate = now has duty to perform
        
        obligee = getting the performance
- - - - The JNA case is an example of forfeiture (restaurant case). For forfeiture to work: It must (1) be an honest mistake (negligence was allowed here) and (2) not prejudice the other party (like releasing the premises or making other obligations). Chelsea made improvements and would lose goodwill. Yes, they breached, but forfiture is unjust.
      - An express condition can be waived! Obligor can say to the obligee he will perform despite the condition not occurring OR by conduct. THIS IS CALLED WAIVER. Oppenhimer.
  - - - The Reading Pipe Case: the contract did not say "if you do not use Reading pipe the contract is null and void!" so Cardozo imposed a CC.
      - 80-85% is not substantial performance. Must be VERY minor. This avoids injustice. If you breach ON PURPOSE, you will not be saved by Sub. Perf.
      - Substantial Performance damages will be the difference in value. (nominal). Wheras normal breach is the cost of replacement.
- - - - Look at surrounding evidence ONLY. A merger clause is but a factor. It is not dispositive.
    - - Look at the 4 corners of the document. If there is a merger clause, the writing is immediately complete. Does the contract appear complete on its face?
        
        If COMPLETE
        
        if PARTIAL
        
        Cannot Contradict but can supplement with evidence.
        
        Prior and Contemporaneous Contradictory and Supplemental evidence will be barred. (The UCC has the same result, but a party may introduce contemporaneous written).
        
        If evidence is barred, ask if there is a valid exception.
        
        Does not apply to bar evidence of an ORAL condition precedent. E.g., "You need to obtain a loan from the bank before you buy this." If it is valid, THERE WILL BE NO CONTRACT. Parties submit evidence and the jury decides.
        
        Does not apply to evidence offered to establish a right to an equitable remedy such as reformation of the contract. If one party can prove something was inadvertently omitted from the writing due to some mistake (computer error or drafter error), that party may seek reformation of the agreement; he must prove such mistake with clear and convincing evidence.
        
        Does not bar evidence introduced to establish a collateral agreement. Evidence of a collateral agreement--one that would naturally and normally be included in a separate writing will not be barred. E.g., an agreement to paint a shed will be in a separate document from an agreement to paint a garage.
        
        Does not apply to evidence offered to show that the agrement was invalid for any reason such as fraud, duress, undue influence, incapacity, mistake, and illegality.
        
        Fraud
        
        2 more items...
        
        Courts will always allow evidence in the sale of goods under the UCC, such as: trade usage, course of performance, and course of dealing.
        
        A clear term can be contradicted by these.
        
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        PER does not apply to resolve ambiguity (by explaining terms). But how do we determine if there is an ambiguity? REMEMBER, BOTH APPROACHES ALLOW EVIDENCE IF THE AMBIGUITY IS PATENT. Patent: on its face, it is ambiguous. Like having 500$ and spelling five thousand dollars.
        
        Willistonian's Latent Ambiguity Approach
        
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        Corbin's latent ambiguity approach
        
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        Patent Ambiguity
        
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        Does not apply to bar evidence (oral or written) of agreements made after the written document. Think of this as a valid modification. Think about the statute of frauds modification requirement. On tests, look at dates. This evidence can contradict.
        
        Any modification to contracts for the sale of goods priced over $500 must be in writing. Unless there was promissory estoppel.
        
        Supplemental Definition: one party enters extrinsic evidence showing the parties agreed to something not expressed in the final writing.
- - - - You determine if a breach is partial/total based on its materiality. Did the injured party (1) obtain substantial benefits which he reasonably contemplated; (2) can the injured party adequately be compensated in damages for lack of performance; (3) the extent the breaching party failed to perform or made preparations to perform; (4) the greater or less hardship the breaching party may face w/ contract termination; (5) the wilfull, negligence, or innocence of the breaching party; (6) the uncertainty regarding whether the failing party will perform the remainder of the contract.
        
        PARTIAL BREACH means you have to continue performing. TOTAL BREACH means the non-breaching party is relieved of her duties and obligations and get damages. Look at the factors in the book --> and in the restatement 242.
        
        Material Breach and Partial breach do not relieve the non breaching party of performance because CURE IS AVALIBLE.
    - - Happens BEFORE performance is due. A party realizes the other party does not (or may not) have the ability to perform.
        
        Requires clear and unequivocal manifestation of intent not to perform on the date performance is due. (the zoning contingency case. There, the P's request was ambigous and did not pass muster).
        
        AR can be retracted until performance is due UNLESS the other party materially changed position or otherwise indicated he considered the AR final.
        
        For the material change option, look for entering a new contract. For the second option, can bring suit or clear say.