Contract signed by Orson Welles to direct play Native Son Created by Pamela S Evers Assoc Prof for Educational Purposes 2001 w updates Contract legally binding agreement promise or set of promises creating an obligation duty to perform for the breach of which the law gives a remedy 1 agreement 2 between competent parties 3 based on genuine assent of the parties that is 4 supported by consideration 5 made for a lawful purpose and 6 in the form required by law if any Promisor person who makes a promise a binding promise creates duty for promisor or obligor Promisee person to whom the promise is made a promissee claims benefit of the obligation or duty under a binding promise thus is an obligee Parties to a contract stand in privity Agreement arises when a person offeror makes an offer and the person to whom the offer is made offeree accepts Offer and acceptance required to form agreement Parties to a contract must have intent to enter binding agreement Facts Jackson bought Connecticut Lotto Quick Pick ticket for 10 13 1995 drawing and won but claimed his prize in person 3 days after final day allowed to claim prize Ticket had instructions to claim prize online warning Prize must be claimed within 1 year from the drawing date Connecticut Lottery Corp CLC denied Jackson s claim since 1 year had elapsed Procedural History and Issue Jackson sued for breach of contract Issue Is lotto ticket a contract Trial Court Ruling Parties entered valid unilateral contract by purchase of a Lotto ticket CLC made a prize offer Jackson accepted offer Consideration supported contract Trial Court Ruling One year presentment rule incorporated into contract whether or not Jackson knew of it Public policy without claim period regulatory scheme of lottery system would be compromised Motion for summary judgment granted Formal or informal Express or implied Bilateral or unilateral Valid voidable or void Executed or executory Express agreement of parties manifested by written or oral words Implied agreement not shown by words but by acts and conduct of parties Difference between express implied contracts relates to manner of proving the existence of the contract not the effect Some terms are implied by law based upon the context of words that are otherwise vague or by acts and conduct of the parties or according to industry practice E g word loan on check will imply agreement to repay amount going to work each day and receiving a paycheck implies an employment contract Precision not required especially with magic words e g good cause Implied terms often depend on industry sack of flour means one thing to a consumer and another to restaurants Indefinite terms implied by industry practice in a requirements contract to buy all requirements of buyer from the seller or outputs contract producer must sell entire production to buyer Broiler farm makes requirements contract with feed producer and poultry integrator e g Tyson makes outputs contract with farm based on pound of meat produced Valid contract agreement binding and enforceable Voidable contract agreement otherwise binding but because of circumstances surrounding execution or lack of capacity may be rejected at option of one party Void contract agreement without legal effect because prohibited by law Option contract the parties make contract that gives one party absolute right to refuse or enter into 2nd contract later the option holder generally pays for the right e g stock option buyer pays seller a premium to have the right but not obligation to buy or sell stock for agreed price at a later date Right of First Refusal contract imposes duty to make first offer to party with right of first refusal E g NBC had right of first refusal with Paramount for the TV show Frasier If there is no agreement reached by March 1 2001 Paramount will submit its last offer Last Offer to NBC If NBC rejects said Last Offer Paramount is free to negotiate with third parties subject to the matching rights of NBC set forth below Uniform Commercial Code applies to sales contracts An obligation imposed by law i e implied by law to prevent unjust enrichment of one party in certain circumstances Example 1 quantum meruit or value of labor Plumber performs work thinking that work is justified under the contract Other party who receives benefit of work denies payment claiming work unjustified Example 2 reasonable price Minor buys car and wrecks it Contract void by law but minor or parents must pay damages based on reasonable value of benefit conferred on minor 17 year old driver killed A promise conditional on an act return promise or forbearance refraining from doing something and requires intent to create binding obligation An invitation to negotiate e g seller sending out flyers catalogs listing prices or for sale ad in newspaper or yard is not an offer Sales puffery is not an offer HARRIER JET FIGHTER 7 000 000 PEPSI POINTS Offer and resulting contract must be definite and certain and communicated to offeree cannot be vague re major points I ll paint your house until I m tired is vague but I ll finish painting your house in three days is definite Headhunter Corp s promise to place Mr Z in a good job is vague but a promise to arrange at least 10 interviews by Nov 10 for jobs with annual salaries 25 000 is certain Revocation if revoked communicated to offeree before offer accepted Counteroffer any change to offer as part of attempt to accept offer is a counteroffer that rejects original offer Rejection Lapse of time offer expires Death or disability of either party Subsequent illegality Acceptance must be by clear expression by offeree of intent to be bound by terms of offer Only offeree may accept offer Silence may be acceptance Sending unrequested merchandise does not obligate payment If offer calls for performance then performance is the acceptance Offeror may specify manner of acceptance e g notify me of your acceptance in writing OFFER AGREEMENT ACCEPTANCE Consideration is legal value given in return for a promise or performance generally money or goods constitute consideration consideration can be a covenant not to sue or doing something not otherwise required to do E g Gottlieb v Tropicana Hotel and Casino participating in promotion that benefited the company was adequate consideration to form a contract A court will not question the fairness of the bargain if legally sufficient Law generally does not protect a person for entering into an unwise contract Court may apply doctrine
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