Week 5 - Monday, September 20th, 2010 I. Contract law...

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Monday, September 20 th , 2010 I. Contract law (cont) A. Valid offer 1. Is there an offer? a. A valid offer has to fulfill three requirements: contractual intention, definiteness, and it must be communicated. 2. Once an offer is accepted, an agreement is reached. 3. Structural arrangement a. Intent to contract i. There has to be intent for an objective legal obligation, where a part plans to live up to the agreement ii. It is not just an invitation, such as advertisements that offer to see at certain prices and what not iii. Lucy v. Zehmer Lucy and Zehmer were drinking when they signed a contract on a restaurant bill to sell Zegmer’s farm to Lucy for $50,000. Zehmer later claimed that this was not serious. Lucy sued, losing at first, but an appeals court found that “a reasonable person” would conclude that the defendant’s words and actions constituted a valid offer. b. Definiteness i. Essential terms: Price of goods or services The subject-matter of the contract The amount of goods or services Time and place of delivery may matter also ii. Under the UCC 2-204(3), even though there might be something important missing in the contract, a court might allow a missing term to be inserted basing it on the intent of the deal The reason, as is the spirit of UCC, is facilitating commerce iii. Martin Delicatessen v. Schumacher Tenant (Deli) and landlord (Schumacher) had contract specifying that lease could be renewed for a 5-year period at rate to be agreed upon. Landlord offered a rate that was far too much for the tenant, who then sued for specific performance of contract renewal. Court sided with the defendant, because agreement to agree is unenforceable. Contract could have included a formula or a method for figuring out the price. iv. UCC says that a pattern of behavior between parties can be codified into a legal ruling.
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v. Andrus v. Department of Transportation Andrus received an affirmative answer to be employed by the DOT during a phone interview. The next day it was revoked. Andrus sued for wrongful breach of contract. Courts ruled in favor of defendant, because a “yes” over the phone, lacking any details/terms of employment, does not constitute a definite offer. c. Communication of offer i. Offeree has to know about the offer before it is valid d. Termination of offer i. Operation of law An offer could be terminated, if too much time passes or there is a time limit specified in writing. The time limit also depends on the subject matter of the offer. Valid termination could also occur because of the destruction of the subject matter, e.g. a house burning down. Also, death or lack of competency of the offeror might terminate it. Supervening illegality means the laws have changed
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This note was uploaded on 12/05/2010 for the course AEM 3200 taught by Professor Grossman,d. during the Fall '07 term at Cornell University (Engineering School).

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Week 5 - Monday, September 20th, 2010 I. Contract law...

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