Contracts

A large percentage of litigation arising out of contracts results from poor drafting. In order to eliminate this litigation, it is imperative that students and legal professionals master good drafting skills. One of the most important aspects of drafting a contract is the operative language--language that affects legal relationships. This lesson is designed to introduce law students to operative language commonly used in drafting contracts, in particular, language of obligation (shall), language of authorization (may) and language of condition precedent (must).

Drafters of contracts, wills and statutes are plagued with the ambiguities inherent in the use of these two connectors. This lesson is designed to identify these ambiguities and then help students to draft with conjunctions which eliminate those ambiguities.

This lesson tries to explain Coasean irrelevance (which is often known as the "Coase Theorem").

This lesson deals with the duration of offers. The existence of an offer is often an essential element of the bargaining process. Sometimes the offeree's power of acceptance will end so that the offer is no longer valid. This lesson will look at termination of the power of acceptance by termination of the offeror, revocation and counteroffer, rejection, death and lapse.

This exercise deals with offer, an essential element of the bargaining process. There are basically three requirements to establish an offer: (1) intent; (2) definiteness; and (3) communication to the offeree.

This lesson explores invitations to negotiate/preliminary negotiations and other statements and expressions that are not offers, including advertisements, invitations to bid, price quotations and statements of intention. Determining whether a particular communication is an offer or preliminary negotiation (a matter determined according to the surrounding circumstances) prior to the formation of contract is essential to the determination of whether a contract exists.

This lesson explores one of the fundamental requirements for contract formation, mutual assent. Mutual Assent is a mutual manifestation of assent to the terms of an agreement. This lesson looks at how parties establish mutual assent, including manifestations of mutual assent by words and conduct and the effect of misunderstanding. However, the attributes of offer and acceptance are covered in other lessons. This lesson concludes with a sample analysis exercise involving mutual assent.

This lesson explores the contours of anticipatory repudiation, including the repudiating promisor's ability to retract his repudiation, the nonrepudiating promisee's right to demand adequate assurances of performance, and the effect of the promisor's repudiation on the promisee's obligation to perform.

Interpretation involves an ascertainment of the meaning of the words and provisions of a contract. Whereas "construction" of a contract relates to the legal effect of the words used by the parties, "interpretation" addresses the meaning of the parties. Whose meaning is to be given effect with respect to certain contract terms? What evidence may be taken into account when courts engage in interpretation? In this lesson, the parol evidence rule will be considered with respect to the admissibility of extrinsic evidence to determine the meaning of the contract as formed.

A contract can contain many different types of promises, made up of both express and implied terms. Express and implied warranty terms are the subject of this lesson. When parties contract for the sale of goods, they have certain expectations about the quality of the goods to be sold. These expectations form the basis of warranties that arise under UCC Article 2. That is, what has the seller agreed to sell?

This lesson considers probably the most common type of implied term, that of good faith. At common law, courts often supply a term requiring the parties to exercise "good faith" or "good faith and fair dealing". Moreover, for the sale of goods, the UCC provides that every contract is subject to good faith requirements, which cannot be disclaimed by agreement.

The terms of a contract include express and implied promises, conditions, provisos and presuppositions that bind the parties. Contracts often have "gaps" in them, either intentionally or unintentionally left that way by the parties. This exercise considers how courts supply terms to fill those gaps both at common law and under the UCC.

This lesson assumes you are familiar with the requirement of consideration and the rule that past consideration is not good consideration. Ordinarily, a promise is legally binding only if that promise is supported by a consideration. As the student may recall, "past consideration" is a misnomer. If a party makes a promise to pay for a benefit previously conferred, there is no consideration for the promise because the benefit was not bargained for in exchange for the promise. This lesson covers one of the exceptions to this general rule.

This lesson assumes students are familiar with the requirement of consideration. This exercise covers one of the exceptions to this general rule. Historically, one situation where consideration was not required to create a binding contract was when the promise was made "under seal." The lesson explains the history of "the seal" and the seal's role in contract law today.

This lesson is about satisfaction clauses. This is an area of special concern, as satisfaction clauses appear to make promises illusory.

This lesson covers one of the fundamental components of contract formation - mutuality of obligation or commitment. Students learn why mutuality of obligation is an essential element of a contract.

This lesson explores the concept of conditions in the law of contracts. It distinguishes promises from conditions, discusses the various kinds of conditions, and explains ways the courts relieve parties from the harsh effect of conditions. The lesson concludes with two sample exam questions.

An overview of the fraud defense to the formation of a contract.

An overview of the defenses of misunderstanding and mistake to the formation of a contract.

This lesson presents an overview of unconscionability as a defense to contract formation or to particular clauses in the contract.

This lesson explores the duress and undue influence defenses to contract formation.

This lesson explores the capacity defense to contract formation, including when a contract may be avoided because of the minority, mental incapacity, or illiteracy of one of the parties.

This lesson explores the illegality defense to contract formation.

This is an overview of vocabulary used in the lessons on Defenses. You might wish to run it prior to running those lessons.