I.

Basis for enforcement: consideration

Consequential damages: P44

A. Quasi contract: is not contract

1. Elements: p15
a. π confers benefit on ∆ with reasonable expectation of compensation
b. ∆ has reasonable time to reject benefit but chooses not to (unless there’s
an emergency)
c. ∆ has appreciation/knowledge of the actual benefit but chooses not to
pay
d. It would be unjust for the ∆ to retain the benefit without paying
2. Remedy: restitution: Value of the benefit conferred on the ∆, and NOT the
value of the detriment conferred on the π OR the reasonable value of the
π’s services
B. Pacta sunt servanda P22b P150
C. Implied in fact contract: Bailey v. West Taco bell p195
1. Definition: Implied in fact contract may be found when the intention to
enter into a contract is not manifested by direct or explicit words between
the parties, but instead is gathered by implication or proper deduction
from the conduct of the parties, language used, or things done by him, or
other pertinent circumstances attending the transaction.
2. Elements:
a. Mutuality: Mutual assent is required
b. Intent to promise: Have the intention to enter into a contract
c. Not expressed via words: By implication from the conduct. Court looks
to the act and conduct of the parties to determine whether the essential
element of an express contract have been made
3. Implied in fact contract arises where one accepts a benefit from another
for which compensation is customarily expected.
4. Wrench v Taco Bell Corp.: court held that the parties understood that
compensation would be paid for services rendered, a promise to pay fair
value may be implied, even if no agreement was reached as to price,
duration, or other terms of the contract
D. Promissory estoppel P143 comment
1. Elements:
a. Promisor reasonably expects promise may induce reliance
b. It goes induce reliance
c. Injustice can only be avoided through enforcement
2. Promissory estoppel is not applied when:
a. Not promise: if successful in being awarded this contract, it will be that
 can be relied on
b. No mutuality of obligation
E. Equitable estoppel: p143
F. Differences between promissory and equitable estoppel:
1. Equitable estoppel traditionally applied only to misrepresentation as to
existing facts.
2. Statement on which promissory estoppel operates is not a representation
as to existing facts but a promise as to the future. Often, it is not a
misrepresentation at all as the intention at the time was to fulfill the
promise.
3. Promissory estoppel expands equitable estoppel to promises
4. Equitable estoppel only operates as a defense or a shield. Promissory
estoppel can be used as a sword, i.e., a cause of action.
II. Mutuality of obligation Lucy
III. Contract Formation
A. Mutual assent: “meeting of the minds” 177
1. Test: objective Test : manifestation of assent reasonable standard 179
2. Offer: p229
a. Advertisement moris209 pepsico
i. Generally,(ad definition 209) advertisement is not offer.- An
advertiser publishes in a newspaper that he has a certain quantity
or quality of goods which he wants to dispose of at certain prices
and on certain terms, such advertisements are not offer, but an
invitation for an offer of sale on the terms stated. Lefkowitz v.
Minneapolis Surplus Store
ii. Exception: when the ad is “clear, definite and explicit and leaves
nothing open for negotiation” .Lefkowitz v. Minneapolis Surplus
Store
iii. Objective, reasonable person standard: court must consider
what an objective, reasonable person would have understand the
commercial.
a) Leonard v. Pepsico: (guy treats commercial for harrier jet as
real offer) advertisement isn’t complete (refers to catalog),
not an offer also, catalogs are only offers to negotiate finally,
it is reasonably clear that it’s a joke, not a serious offer; To
create an offer, the act must lead the offeree reasonably to
conclude that a power to create a contract is conferred.
b. How to decide whether an ad or offer?
i. Whether the communication shows a manifestation of willingness
to be bound?
c. Termination of an offer: Restatement 36(common law) UCC?
i. Rejection or counteroffer by offeree
ii. Lapse of time: Ever-Tite Roofing
a) An offeree's power of acceptance is terminated at the time
 specified in the offer, or, if no time is specified, at the end of
a reasonable time.
b) What is a reasonable time is a question of fact, depending on
all the circumstances existing when the offer and attempted
acceptance are made.
iii. Revocation by offeror: Common law, if an offer specifies time, can
he revoke ? R25 (P270 difference between option k?)
a) Offeree must receive the revocation before accepting R42
b) Limits of revoke:
 (only UCC 2-205) Firm offer: (Dickinson P270)
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.
 Between merchants, in a signed writing by offeror
– gives assurance that offer will be held open
 No Consideration needed during time stated, and if
no time stated – reasonable period of time
 Only a 3 month ceiling. No matter what the
writing says.
 Watch out for writing without an express promise
 Reliance: p297
iv. death or incapacity of the offeror or offeree.
3. Acceptance:
a. 287 part performance by the offeree of an offer
b. P241 UCC 2206
c. NON-CONFORMING
d.
4. Unilateral contract: Acceptance by performance
a. Offeree create option contract by beginning performance
i. Offeree is not bound to complete performance
ii. Offeree is bound conditional upon completion of performance by
offeree
B. Contract without consent
1. The battle of the forms
a. Prior performance: “mirror image rule”
i. a communication is a acceptance only if all of its terms
match. R2K §59 – if don’t match, it is a counteroffer.
ii. Exception: ?
b. After performance: UCC2-207
 i. A definite and seasonable expression of acceptance or a written
confirmation which is sent within a reasonable time operates as an
acceptance even though it states terms additional to or different
from those offered or agreed upon, unless acceptance is expressly
made conditional on assent to the additional or different terms.
ii. The additional terms are to be construed as proposals for addition
to the contract. Between merchants such terms become part of the
contract unless:
a) the offer expressly limits acceptance to the terms of the offer;
b) they materially alter it; or
c) notification of objection to them has already been given or is
given within a reasonable time after notice of them is received.
iii. Conduct by both parties which recognizes the existence of
a contract is sufficient to establish a contract for salealthough the
writings of the parties do not otherwise establish a contract. In such
case the terms of the particular contract consist of those terms on
which the writings of the parties agree, together with any
supplementary terms incorporated under any other provisions of
this Act.
iv.
C. Written assent
1. Parol Evidence Rule: extrinsic evidence of a prior or contemporary
agreement is generally not admissible to vary, add or contradict the terms
of an unambiguous and complete written document nor may such
evidence be used to create ambiguity in an otherwise unambiguous
document
a. Parol evidence can be written, can be oral
b. Integration, it’s possible for document to be partially integrated
2. Step 1: determine whether and to what extent the agreement is integrated
a. How is this issue raised?
i. One of the parties seeks to admit parol evidence
b. Wo decide whether or to what extent the agreement is integrated?
i. Judge. As a matter of fact
c. What's the fact to be ascertained?
i. Whether the parties intended to reduce entire agreement to writing.
R209
d. What evidence is admissible to prove/disapprove integration?
i. Anything relevant
e. Is this binary?
i. No, can be partially integrated
f. Who decides the level?
i. Judge.
ii. What evidence could be used to decide level of integration”
anything relevant
 g. Can a document ‘self-prove’ its own integration status?
i. No, it’s rebuttable. Even if the document says “it’s integrated”,
judge has opportunity to look other evidence to decide
3. Step 2: if the agreement is integrated(fully or partially), interpret the parol
evidence for consistency with the integrated agreement
a. Who decides whether the evidence is consistent/ inconsistent
i. If the interpretation of evidence depends on the credibility of the
evidence—jury
ii. If the interpretation of evidence requires a choice among
reasonable inference to be drawn from the evidence—jury
a) Unless one proposed interpretation is unreasonable—judge
b. If the evidence is inconsistent with the integrated agreement,
inadmissible
c. If the evidence is consistent, it is admissible
D. Unique contract:
1. Option contract Humble 278 281 Marchiondo284
a. Creates two distinct obligations
i. To keep available the option to purchase for a fixed period of time
ii. To negotiate in good faith for the second contract
b. It is a contract
c. Be supported by consideration
2. Output contract: whatever the sell have, buyer will buy
3. Requirement contract: whatever the buyer needs, the sell will sell
IV. Defense to contractual obligation
A. Duress
B. Unconscionability p23+Jones v. Star 104
1. Elements:
a. Absence of meaningful choice on the part of the breaching party
i. The meaningfulness of the choice is negated by a gross inequality
of bargaining power
ii. The manner in which the contract was entered is also relevant:
ordinarily, one who signs an agreement without full knowledge of
its terms might he held to assume the risk that
b. The terms which are unreasonably favorable to the other party
2. UCC 2-302 p105
C. Mistake
1. Mutual mistake
a. Is there a mistake?
i. No---enforceable
ii. YES—
a) The mistake is collateral—enforceable
b) The mistake is character or essence
 Did the parties address or allocate the risk?
 Yes—enforceable
  No-court’s discretion
2. Unilateral mistake: When a unilateral mistake as to a basic assumption
has a material effect, the K is voidable by the adversely affected party if
he does not bear the risk of the mistake AND:
a. enforcement of the K would be unconscionable; OR
b. “the other party had reason to know of the mistake or his
fault caused the mistake.”
D. Nondisclosure and misrepresentation
1. K is voidable when:R164(1)
a. If a party's manifestation of assent is induced by either a fraudulent or
a material misrepresentation by the other party upon which the
recipient is justified in relying, the contract is voidable by the recipient.
b.
2. A misrepresentation is fraudulent or material if the maker intends his
assertion to induce a party to manifest his assent and the maker: R162
a. knows or believes that the assertion is not in accord with the facts, or
b. does not have the confidence that he states or implies in the truth of the
assertion, or
c. knows that he does not have the basis that he states or implies for the
assertion.
3. When nondisclosure is equivalent to an assertion R161
a. where he knows that disclosure of the fact is necessary to prevent some
previous assertion from being a misrepresentation or from being
fraudulent or material.
b. where he knows that disclosure of the fact would correct a mistake of
the other party as to a basic assumption on which that party is making
the contract and if non-disclosure of the fact amounts to a failure to act
in good faith and in accordance with reasonable standards of fair
dealing.
c. where he knows that disclosure of the fact would correct a mistake of
the other party as to the contents or effect of a writing, evidencing or
embodying an agreement in whole or in part.
d. where the other person is entitled to know the fact because of a relation
of trust and confidence between them.
V. Remedy
A. Expectancy: put P in position: he would have occupied has the contract been
performed
B. Reliance: put P in position: he was in pre-K by compensating for expenditures
C. Restitution: put P in position: he was in pre-contract, restore to P benefits
conferred on D