Common Law Acceptance and counter offers are governed by the mirror rule Rejection Counter Offer Mirror Image Rule if you change something it doesn t meet the mirror image rule Termination by Law Time terminates after 10 days destruction cannot fulfill it death incompetence if the offerer or offeree dies exception is if offer is irrevocable and the offerree doesn t want to get it and illegality if the offer is made and then becomes illegal the offer then terminates 1 Acts consistent with acceptance 2 Prior dealings you started an arrangement that both agreed on and continued with even if it was not reset up every time You then have the duty to object 3 Unilateral Contract can only be accepted by performance You have to do the act to have the contract Bilateral contracts cannot be accepted by silence You must communicate your offer for all other forms of contracts The Authorized Method of Acceptance set price parties time etc Common Law Exceptions to the Rule Any Means that is as fast or faster as the Authorized Method U S Mail always implied to be acceptable if the parties are bargaining in business How do we know when the acceptance is enacted The Mailbox Rule an acceptance is effective upon dispatch If the acceptance is not properly dispatched it won t be effective until received If the offerer conditioned acceptance upon receipt it will be honored if the offerree sends the acceptance after a rejection or counter offer in order to get the mailbox rule the offerer has to receive the acceptance first You don t get the mailbox rule if the method you chose is unauthorized Consideration something of value given in return for a promise it can be something obscure and small it just must have a legal value Sufficient Consideration giving up a legal right for something A pure gift don t establish contractual relations Insufficient consideration A pre existing duty promise to do something you said you wouldn t but you couldn t legally do it anyway extortion Exceptions unforeseen circumstances and parties agreeing to a new superseding contract Past Consideration promises made in return for acts or events that have already taken place are generally unenforceable Exceptions none Promissory Offer an offer that is irrevocable because there is a reliance by an offerree in some way 1 The promise is clear and definite 2 There is a justifiable reliance on promise 3 The promise was substantial and of definite character 4 Enforcing the promise will serve the best interest of justice 3 types of people can lack capacity to enter contracts minors emancipated married etc are exceptions drunk people above 08 can t even comprehend the legal ramifications of the contract and mentally impaired or incompetent people Minors can ratify or void a contract drunken people only can void the contract voidable at the option of the mentally incapacitated or impaired person If you re declared incompetent by the court the contract is void Contracts against Law illegal contracts are void as a matter of law Usury shy locking laws contracts that exceed a statutory maximum Gambling a matter of public policy Contracts entered into with Unlicensed People says it in the title Restrictive Covenants for Sale of a Business I m done with this but you can have my business Reasonableness is key as to period of time and geography Employment Contract prevents someone from working as an employee and taking secrets for their own shop or working for a competitor Competition can be restricted by contract but both companies must agree When people make mistakes in contracts Enforceability depends on the mistake and how many people are privy to the offer Material it must have a real impact Is the mistake material Only matters if it is 1 Mutual or Bilateral Mistake when both parties are mistaken about some material term The contract is then voidable by either party 2 Unilateral Mistake only one of the parties is mistaken about the material term It normally will not excuse the contract Two exceptions other party knew or should have known about the mistake OR the mistake is one of mathematics only typo 3 Mistake of Value mistake of value or quality of an item either party can enforce the contract Must be a mistake of value and fact 11 6 14 Misrepresentation Fraud Misrepresentation Fraud always requires some high level of intent Seienter the highest level of knowingly doing something wrong illegal harmful etc Fraud in the Inducement there is a misrepresentation of the fact it is intentionally misrepresented so that the person will do what you want them to Has to be really factually wrong and specific This is the most common type of fraud Fraud in the Factum a misrepresentation where someone enters into a contract unknowingly Fraud in the Execution nothing is wrong with the document but the person signing is not the person they are supposed to be Defenses Against a Contract Undue Influence one party overcomes the free will of another due to a relationship so that the person doesn t have a choice but to enter a contract a court can cancel or resend this contract Undue Duress blackmail gun to your head Not because of the relationship but because of the threat Statute of Frauds not about fraud not a statute It basically just requires certain types of contracts to be in writing If it is one of the following contracts it is unenforceable by oral agreement 1 Sale of Real Property 2 Contracts of 1 year or more cannot be performed within one year 3 Suretyship agreeing to answer for the debts of another 4 Promises of an Executor debts of an Estate executor of a will 5 Prenups 6 Sale of Goods 500 or more Steps for Contracts 1 Whenever possible have a written contract 2 Outline your understanding of the deal in an e mail fax letter etc 3 If you receive such a confirmation read it carefully If it s wrong let the other person know 4 Make your objections immediately and in writing UCC Uniform Commercial Code What is the scope of the UCC It covers when we re contracting to transfer ownership of tangible goods and rights in exchange for money UCC covers personal property only It must have an inherit physical value and can be moved from place to place If a good is attached to real property it is a good if it can be separated from the real property without damaging it Article II does not cover services stocks intellectual property or land real property Court decides between UCC and Common Law when the case has elements of both UCC 2A covers leases commercial
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