Contracts II - Class Notes

Contracts II - Class Notes - Contracts II Class Notes...

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Contracts II – Class Notes www.swapnotes.com Page 1 of 76 Professor Jacobson Spring 2005 Drennan v Start Paving Co - option K does not need consideration 1) General suing sub b/c sub wouldn’t perform since its bid was too low. 2) Traynor uses PE even though no promises b/c there was reasonable reliance 3) Section 45 -once offeree in a unilateral K commences performance, a subsidiary promise is implied to keep the promise open . a) Really ends up making a bilateral K b/c both sides are bound by this! b) Offeree gets an option K where the consideration supporting the option is part performance. 4) Unilateral K theory that the promise is held open since the general relied on the bid. A subsidiary promise to keep the offer open is implied b/c the consideration supporting the option here is using the sub’s bid since the sub sought the use of his bid! 5) Traynor is a realist based on what happens in the industry, while Hand is idealist that pp deal at arms length and e/t needs to be spelled out. a) We bind the sub’s to protect the general b/c the reason generals don’t bargain for favorable terms b/c those terms already exist implicitly in the relationship 6) UCC-2-205- firm offer Æ if in writing and assurance that will be open, will be enforced as an option K even if there is no consideration. Hoffman v Red Owl Stores 1) Hoffman was considered a very far out case in 1965 b/c the jury found that the parties had no K and the parties understood that they had no K. (Empro) Æ It was just negotiations! 2) Say Hoffman and Red Owl agent did all the negotiations in one sitting instead of over a few years. Hoffman says only have $18,000 and agent agrees. a) Is there a deal? Are they bound? No b/c there are too many open terms. b) What if there were no apparent open terms? 1/21/05 Hoffman v Red Owl Stores. 1) Hoffman was considered a very far out case—in 1965—this is a case in which the parties had no contract—these parties understood that they had no contract— a) Negotiations-we reach an agreement in stages—okay we agree about this--$18,000 that should be fine b) Suppose Hoffman and Red Owl agent are sitting in room together—all being done at one moment—Hoffman says I got $18000 bucks—Red Owl says okay I agree-$18,000 i) Bound to $18,000—Not a real offer b/c too many open terms—what if there are no apparent open terms—what if I think there is an open term but you don’t. .b/gyh a point I wanted to raise— (1) Has to be some event where parties manifest a present intention to be contractually bound—shake hands—soething has to ring the bell to say that negotiations stopped and we have a deal—if in the course of a negotiation you suggest you should do something to get experience and you do that c) They hadn’t agreed to all the terms—finding of fact from the jury—material terms missing—agreed on certain terms but not an agreement that can be characterized as a K i) Ex) we agree to meet at the movies—not contractual b/c we don’t intend to create
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Contracts II - Class Notes - Contracts II Class Notes...

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