REVIEW SLIDES 12 13 2022.pdf

Essential Elements of a Contract
• Mutual Assent
• Consideration
• Legality of Object and Performance
• Capacity

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Express vs. Implied Contracts
• Express: terms of contract are set
forth either in writing or orally.
• Implied-in-Fact elements: based on
conduct.
– Plaintiff furnished service or product.
– Plaintiff expects to be compensated.
– Defendant had a chance to reject and did
not.
.

REMEDIES
• Purpose (in contract) - NOT to
penalize breaching party (punitive
damages)
• Rather, to COMPENSATE
AGGRIEVED PARTY
• i.e., to put aggrieved party in
position she would have been in if
contract had been performed

Damages
Damages must be :
Proximate--where the act or omission plays a substantial part in
causing the damages
Foreseeable-- to know in advance, the act of looking forward
(foresight)
----what would a reasonable person be able to foresee as a result
of the breach
Reasonably Certain—damages must be proved not merely
speculated upon

Quantum meruit
• Quantum meruit – “as much as he deserves”
• Reasonable value of services
• where services, issue may be value of services
to other party
• For court to determine

EQUITABLE CONTRACT REMEDIES
If there’s NOT a remedy at law ( damages) i.e. if money
won’t suffice to pay for the breach
Types of equitable remedies
1. Specific performance—forces performance
Cannot get for non- unique for personal property as there damages
can be quantified
Cannot get for personal services agreement
Can be used to force someone to sell you a specific (unique ) painting
or a piece of land you agreed to buy
2. Injunction
Eg. Stop a union strike, to stop someone from
illegally competing

Equitable contract remedies ( cont)
3. Restitution
-returns to the party the consideration he gave…..puts party in
position he would have been if no contract
When it might be available
-- if total breach
--if repudiation ( I’m not going to perform)
-- minor avoids a contract
-- there is fraud in a procuring a contract
4. Reformation
Court rewrites contract to make it conform to parties’ intent

Q. WHAT IS AN OFFER?
A. A MANISFESTATION OF WILLINGNESS TO
ENTER INTO A BARGAIN TO JUSTIFY ANOTHER
PERSON IN UNDERSTANDING THAT HIS
ASSENT TO THE BARGAIN IS INVITED AND
WILL CONCLUDE THE BARGAIN
OFFER MUST HAVE:
• COMMUNICATION
• INTENT
• DEFINITENESS

COMMUNICATION of an Offer
• Offer must be communicated to specific
Offeree by an authorized person
A tells B that A intends to offer C a job. B
without A’s permission offers C the Job.
Q. Has an authorized offer has been made?

Q. HOW LONG DO OFFERS STAY OPEN?
IF NOT A STATED TIME,A REASONABLE TIME
UNDER THE CIRCUMSTANCES AT HAND
Q. WHEN CAN OFFERS BE REVOKED?
• AT ANY TIME BEFORE AN OFFER HAS BEEN ACCEPTED
UNLESS OFFER IS IRREVOCABLE
• TO EFFECT A REVOCATION THE NOTICE OF OR KNOWLEDGE
ABOUT REVOCATION OR REVOCABLE ACT MUST BE
RECEIVED BY OFFEREE

Revocation
• Manifestation of unwillingness to enter into
contract on offeror’s terms
• May be express or implied
• May be by conduct
• Effective on receipt by offeree
• Terminates power to accept
• Unless irrevocable offer

UCC 2-104 Definition of a Merchant
“Merchant” means a person
• Who deals in the kind of goods involved in the
transaction
• Or who holds himself out as having knowledge
or skill about the practices or goods involved
in the transaction
• Or who uses an agent, broker or other
intermediary who has such knowledge or skill

UCC § 2-205 ( page 329)
§ 2-205 – Firm Offers
An offer by a merchant to buy or sell goods in a signed
writing which by its terms gives assurance that it will
be held open is not revocable, for lack of
consideration, during the time stated or if no time is
stated for a reasonable time, but in no event may
such period of irrevocability exceed three months;
but any such term of assurance on a form supplied
by the offeree must be separately signed by the
offeror.

NY GOL § 5-1109—IF YOU’RE NOT A MERCHANT
• 5-1109. Written irrevocable offer
• For non merchants in NY
• Firm offer
• is made in a writing signed by the offeror, or by his agent
• which states that the offer is irrevocable during a period set
forth or until a time fixed
• when such a writing states that the offer is irrevocable but
does not state any period or time of irrevocability, it shall be
construed to state that the offer is irrevocable for a
reasonable time.

GOL § 5-1109 (cont.)
• Applies to any offer that is not an offer by a
merchant to buy or sell goods, so, for example, to
offer for:
– Real property
– Services
– To buy or sell goods if not made by a merchant
• Must be in writing and signed
• Must have “firm offer” language within it

FIRM OFFER LANGUAGE
All firm offers for merchants and non-merchants
must be fully in writing and be signed and :
Must give affirmative assurance that offer will be
held open
“this is a “firm offer”
“will remain open”
“will not be withdrawn”
“is irrevocable”
Not affirmative assurance language:
“ this offer will expire on . . . “
“you must reply by . . . “
“If I do not hear from you by . . . “

Inquiries
• No indication of unwillingness to accept the
terms of the offer;
• Merely proposes new or different terms
• Doesn’t terminate offer
• Inquiry language : Generally a question= “?”
Ex. Would you a consider? Would you take?

Counteroffer
• Counteroffer terminates offer and power to accept,
unless irrevocable offer
• Effective on receipt (i.e. offer is terminated)
• Offeror does not have to respond for offer to
terminate
• Offeror can accept counteroffer
• For a counteroffer the offeree almost always
rejects the offeror’s offered price

TERMINATION OF OFFER BY OPERATION OF LAW
DEATH
Of Offeree - Offer terminates - offer not transferable
Of Offeror - Depends on whether offer irrevocable
General rule - death does not terminate one’s contractual
obligations, including obligation created by irrevocable offer
unless offeror’s existence would be required for performance of
contract that would be formed
• Revocable -Offer terminates upon end of offer or
upon receipt of revocation
• Irrevocable - treated as contract

CONSIDERATION
Consideration is legally sufficient value given in return
for a promise.
The promise is induced by the value given;
bargained-for-exchange between the parties.

Liquidated Debt (or obligation) vs Unliquidated
debt
• Liquidated :No dispute or uncertainty as to
existence or amount of debt
• Exs.
• 1. D agrees to buy big screen TV from C for $5,000,
payable in 30 days.
• TV delivered, works fine.
• Unliquidated: D buys TV from C for $5000 and TV
doesn’t work right and there is dispute

Settlement of Liquidated Debt
(undisputed ) for other than the full
amount due
• For new promise to be enforceable, either:
• 1. Must be “new consideration” – “something
else of value” other than payment of lower
amount (i.e. C must get legal benefit or D
legal detriment)
• Exs.
• $75,000 + Rolex watch worth $1,000
• $75,000 + I’ll drive you to work next week

Settlement of Liquidated Debt (cont.)
• Or
• 2. The promise to accept less must be in
writing and signed by creditor
• NY GOL § 5-1103
• So if liquidated debt, in order for promise by
creditor to take less to be enforceable (and
debt to be discharged) there must be either
“new” consideration or written promise
signed by creditor

Settlement of Unliquidated Debt---
Implied Promise to Take Less in Full
Satisfaction
• Creditor’s promise is not always express
• For example, debtor sends less than creditor
claims is owed and clearly indicates that
payment is offered in full satisfaction (e.g.,
letter)
• creditor, by keeping payment, is accepting it on
terms offered. Since debt is unliquidated, there
is consideration
• By keeping payment, creditor will be deemed to
have made an implied promise to accept the
payment in full satisfaction if debt is
unliquidated

Special Problem – “Full Satisfaction” Checks
• Unliquidated debt
• D sends check clearly marked “in full satisfaction” or “in full
payment”, etc. and C cashes = Accord and Satisfaction
• Creditor can accept payment and reserve rights to collect
balance and avoids accord and satisfaction by expressly
reserving rights
• Creditor writes on check “under protest,” “without
prejudice,” or “with full reservation of rights.”

Accord and Satisfaction
• Accord - Agreement to accept a different
performance in satisfaction of an existing
unliquidated debt
• Satisfaction – Acceptance of that different
performance by the creditor

ENFORCIBILITY OF CONTRACTS
Are certain contracts void or
voidable

OVERVIEW
• The law requires that mutual assent be
voluntary and knowing
• Potential causes of action when assent
is not both voluntary and knowing
– Mistake
– Fraud
– Undue Influence
– Duress

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Mistakes

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Mistakes
• Unilateral Mistake (of Fact).
–Party does not have the right to cancel
contract unless:
• (1) the non-mistaken party knew or should
have known about the mistake, or
• (2) there is a significant clerical error e.g.
contractor mis-measures site

Mutual Mistake
• Identity or existence of subject matter
• Essential nature of subject matter
BUT NOT :
• if there has been assumption of risk (eg. parties
agree stone is a diamond or not);
• If parties contract for item “as is”
• If parties make a mistake as to the value of an item
Ex 13.1 and Add’l Prob 12-5 ( both parties wrong re
value of item)
• also financial assumptions don’t permit mutual
mistake

Fraud (in the representation)
• (Distinguish from fraud in the execution)
• All the following elements must all be
present for there to be a claim of fraud
– False representation of material fact
– Made with knowledge of falsity and intent
to deceive (scienter)
– Reliance REQUIRED BY DEFRAUDED PTY
– Detriment (damage, injury)
▪ If all elements present, contract is voidable
by defrauded pty

Equitable Remedies for Fraud
• Rescission – rescind (disaffirm, avoid)
contract
• Restitution - Return of benefits
conferred
• Both sides are returned to pre-contract
positions – “status quo ante”
• With fraud the contract is voidable if
the party who is defrauded acts
promptly to undue it

STATUTE OF FRAUDS
DEALS WITH WHETHER A
PARTICULAR TYPE OF
CONTRACT NEEDS TO BE IN
WRITING IF IT IS TO BE
ENFORCIBLE BY A PARTY
SEEKING ENFORCEMENT

Categories
• Types of contracts within the Statute of
Frauds
• Real property
• One year
• Suretyship (collateral contract or guarantee)
• Sales of goods for price of $500 or more
• marriage

• ISSUES TO REMEMBER-----
• Not a basis for rescission of executed
contract
• St of Frauds a defense only if contract
still executory i.e still not fully performed
• The Statute must be asserted as an
affirmative defense at trial to be used
• Does not effect whether contract has been
formed or has been breached

Terminology
• “within” - contract is of type on “list”
• “not within” - contract is not type on list
• “satisfy the Statute” - if contract is within the
Statute of Frauds, the question is whether the
Statute of Frauds has been satisfied

Satisfying the Statute
• One way Statute can always be satisfied
(GOL § 5-701)
• Contract (“it”)
• Is in writing
• Signed (“subscribed’) by the party to be
charged
• Note - In a lawsuit, satisfying statute doesn’t
mean plaintiff automatically prevails - still
has to prove terms of contract and breach

Real Property Provision
• NY GOL § 5-703
• Within: Any contract that creates or transfers
an interest in real property
• E.g., sale, lease, mortgage
• Except lease for a term of one year or less
For a real property lease it doesn’t matter
when parties enter into contract; issue is
length of time tenant is entitled to occupy
property . One year period is measured from
start of lease. Add’I prob. 12-11

What you need for Real Estate Part
Performance Exception
• Part payment +
• Possession (entry on property with
owner’s consent) +
• Substantial improvements (“reliance,”
“inequitable”)
• Part payment insufficient
• Performance must be “unequivocally
referable” to alleged contract
• Add’l prob 12-9

One Year Provision (GOL § 5-701 (1))
• Contract which “by its terms” cannot
be performed within one year from the
day after the contract was made
• Key date - date contract entered into
(“made”)
• If contract made today, cannot be fully
performed by that date next year, it is
within the Statute
• Add’l Prob 12-12(b) and 12-13(a)

One Year Provision (cont.)
• Examples of “within”
• Possibility test—even if improbable can the
contract be completed within one year or
less Add’l Prob 12-13(b), Ex 12.13
• Examples of “ not within” i.e. no St of Fr
issue
– Indefinite term. For example, contract to be
completed not greater than two years =Contract
can be completed in a period less than one year

Suretyship (collateral promise) –
GOL § 5-701 (2)
• Within: Promise to answer for the debt of
another– a collateral promise
• S (Surety) promises C that if D doesn’t pay, S
will
• i.e., promises to be secondarily (collaterally)
liable for D’s debt

Contract for the sale of goods for a
price of $500 or more
• How satisfied:
• A signed writing
• a. Sufficient to indicate that a contract for
sale has been made
• b. Signature of pty to be charged
• Note: part payment for a good takes the
requirement of a writing for that good
away

PERFORMANCE, BREACH
AND DISCHARGE

Discharge of contractual obligations
• i.e., termination of contract obligations
• May occur by:
• Failure of condition e.g. condition precedent
▪ Performance impossible e.g specified item
destroyed. Must have specified item for sale
▪ Breach
▪ Agreement
▪ Operation of law e.g. contract becomes
illegal

NEGLIGENCE:
Conduct which falls below the standard
established by law for the protection of
others against an unreasonable risk of
harm
i.e. Failure to exercise reasonable care
under the circumstances

Elements of a claim of
negligence
A. Duty of care
B Breach of duty of care
C. (which is the ) proximate cause ( and
a foreseeable consequence) of the
defendant’s conduct
C. (of) a type of injury protected by the
law

Standard of Conduct
• General standard is that of a
“Reasonable Person,”
• Reasonable person= an objective
standard under the circumstances
• Did the defendant use the degree of
care that a reasonable person would
use in the same circumstances?

Duty of care --Invitor vs Licensor
Invitor (business owner) has higher
duty to customer ( invitee) than
licensor (home owner) has duty to
house guest ( licensee)
Business owner must warn invitee of
dangerous condition he knows of or should
discover and invitee is not likely to discover
Home owner must warn licensee of dangerous
condition he knows of and licensee is not likely
to discover

PROXIMATE CAUSE
• Defendant’s breach of duty must be the
proximate cause of plaintiff’s injury
= causation in fact that was foreseeable
=“But for” test - injury would not have
happened but for negligent conduct of
defendant
• “Substantial factor” test – defendant’s
negligent conduct was substantial factor in
causing injury

Proximate Cause (cont.)
• Unforeseeable consequences
• Defendant not liable where he could not
have “reasonably foreseen” harm to plaintiff
or class of persons to which plaintiff belongs
• Superseding cause page 116
• If event is judged to be superseding cause,
defendant is relieved of liability for that
cause but not the original negligent act

FORSEEABILITY
• Would Defendant have foreseen plaintiff’s
injury or was the injury not predictable in the
ordinary course

Injury
• Must be harm to legally protected
interest
• You must prove by a preponderance of
the evidence - personal injury, damage
to property

Defenses to Negligence
• Assumption of Risk
• Plaintiff voluntarily and knowingly
assumes risk of harm arising from
defendant’s negligent conduct
• Comparative Negligence - modern rule
• Jury can apportion fault
• Damages decrease to extent of
plaintiff’s fault

Product Liability and Strict
Liability

Strict Liability– another way
for liability to be found
• Strict Liability “without fault”
• i.e., liable without intentional or
negligent conduct

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Strict Product Liability For Manufactured
Products
• Liability without regard to fault or standard
of care.
• Injured party can be 3rd party (not the
buyer).
• Assumption that:
– Consumers should be protected against unsafe
products.
– Manufacturers and distributors should not escape
liability for defective products, and
– Manufacturers and sellers are in a better position to
bear the costs of injury.

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Six Elements Needed for Strict Liability
• Product must be in a defective condition when
sold.
• Defendant must be engaged in selling that
product i.e. defendant is a merchant
• Product must be “unreasonably dangerous”:
product is dangerous beyond ordinary
expectation or less dangerous alternative not
used.
• Plaintiff must incur injury to self or property by
use or consumption of the product
• Defective condition must be cause
• Goods have not substantially changed from time
of sale.

Who is Liable for a product liability claim
• BOTH MANUFACTURERS AND
RETAILER/DISTRIBUTOR ARE LIABLE
EVEN THOUGH A PRODUCT WAS
PURCHASED BY A CONSUMER FROM
A RETAILER
• You must be a manufacturer or
retailer/distributor to be liable
65

SOME EXAMPLES
• Pharmaceuticals
• Machines that need guards on them—
saws, industrial machinery
• Toys that can injure children
• Blood given by a hospital
66

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Product Defects—CAN BE:
• Manufacturing Defects.
• Design Defects.
– Plaintiff must show a reasonable alternative
design was available.
• Inadequate Warnings.
– Manufacturer must warn if foreseeable misuse will
cause injury.
– Factors: user groups, content of message.
– E.g. Manufacturer has to warn of possible injuries
using a trampoline
– Ex 6.6 You must warn about danger of using a
defibrillator

Defenses to Strict Liability
Assumption of risk
---Product is altered– you took the guard
off the saw
Misuse of the product
--- you use a hair dryer in the bathtub ( and
electrocute yourself!)
Comparative negligence can be used to reduce
your responsibility

Employment Law
• Generally employment is “at will”– you can be
fired at any time for any reason
• There are exceptions—
Whistle blowers statutes
Anti discrimination statutes

71
• Title VII prohibits discrimination in
employment on the basis of race, sex,
color, religion, and national origin.
“Sex” now includes pregnancy.
• In addition to prohibiting religious
discrimination, employers must
reasonably accommodate an
employee’s religious practices.
• Enforcement of Title VII by EEOC.
Title VII of the Civil Rights Act of 1964

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• U.S. Supreme Court has interpreted
Title VII’s prohibition against sex
discrimination to include a prohibition
against sexual harassment.
• There are currently two forms of
recognized sexual harassment:
– Hostile Work Environment. →
– Quid Pro Quo.→
Sexual Harassment

73
Sexual Harassment
• Hostile environment: Occurs when workplace is
“permeated” with discriminatory intimidation,
ridicule, insult so severe to alter the conditions of
the victim’s employment.
• Quid Pro Quo : Involves demands for sexual favors
by a supervisor from a subordinate, in exchange for
some workplace benefit.

Elements to prove a Title VII violation of
race, gender, nat’I origin or sex
discrimination:
• You must prove the plaintiff :
• was a member of a protected class,
• was otherwise qualified for the job,
• suffered an adverse employment action,
( not promoted, not hired, not given a
raise etc ) and
• was replaced by someone outside his
protected class
74

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• The Age Discrimination in Employment
Act (ADEA) protects individuals over the
age of 40 from workplace discrimination
that favors younger workers.
• Plaintiff must show:
– He was member of protected age group,
– Was qualified for the position from which he
was discharged, and
– Was discharged under circumstances that
inferred discrimination.
Discrimination Based on Age

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• The Americans with Disability Act
(ADA) requires employers to offer
reasonable accommodation to
employees or applicants with a
“disability” who are otherwise qualified
for the job they hold or seek.
• The duty of reasonable
accommodation ends at the point at
where it becomes an undue hardship.
Discrimination Based On Disability

77
Procedures under ADA
• To prevail on a claim under ADA,
plaintiff must show the following
elements: She:
– Has a “disability.”
– Is otherwise qualified for the employment in
question; and
– Was excluded from employment solely
because of the disability.
– Workforce must be more than 15 employees
• Plaintiff must first exhaust
administrative relief with EEOC.

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ADA: What is a “Disability”?
• ADA defines disability as:
– Physical or mental impairment that
“substantially limits” one or more of major life
activities; or
– A record of such impairment; or
– Being regarded as having such an
impairment.
• Determination is decided on a case-by-
case basis.

79
Key Differences between Civil Law and
Criminal Law
Note : Criminal Laws must be set forth
by statute

80
Corporate Criminal Liability
• Liability of the Corporate Entity.
– Crimes must occur within scope of
employment.
– Corporations can be held criminally liable
when they FAIL to fulfill certain statutory
duties.
• Corporate officers and directors can
be criminally liable under the
“Responsible Corporate Officer”
doctrine.

REVIEW SLIDES 12 13 2022.pdf

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REVIEW SLIDES 12 13 2022.pdf