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Contracts
South Texas College of Law Houston
Ricks, Val D.

I. Introduction
A. Various attempts have been made to promulgate a federal contract law, but none have as yet succeeded.
B. That means that states control contract law – Contract law is promulgated by state courts and state legislatures.
C. Court Made Law:
D. Legislative Made Law:
E. Case Law:
F. Two Groups that have influenced the process of contract-lawmaking in America.
– National Conference of Commissioners on Uniform State Laws (NCCUSL).
– Included 50 state-appointed commissioners who draft and recommend legislation to state legislatures.
– http://www.nccusl.org
– American Law Institute (ALI)
– Organization of lawyers, judges, and legal academics dedicated to clarifying, simplifying, and reforming law.
– http://www.ali.org
– Primary vehicle for accomplishing its mission is to “restate” the common law; i.e. boil down all the common law from court opinions into black letter rules that lawyers can better understand.
– First Restatement of Contracts was published in 1932.
§ Sometimes restates the common law but, often “restates”(?) as law what is not yet law.
– Second Restatement of Contracts was published in 1981.
§ Proposes more of the reforming like First
§ More commentary on where the law should be going.
– Restatement (second) is not law but only commentary, unless it has been adopted by courts.
G. Uniform Commercial Code (UCC)
– Between 1940 and 1952, NCCUSL and the ALI teamed up to draft the UCC which they then proposed to state legislatures.
– All fifty state legislatures passed it, with only some local variation (though Louisiana did not pass Article Two).
– Result: For most commercial transactions, the law of all fifty states is uniform.
H. Natural Right to Contract – we have no natural right (i.e. Constitutional Provision) to contract for economic matters.
I. Farmer v. Brook (1589) – Welfare theory because the holding provided a public benefit.
– Facts: Farmer (P – lord) sued Brook (D – baker) because D set up bakery in lords territory. D argues that he has legal contract because it is for benefit of the people. D argues through a natural law and free market values (i.e. Aristotelian) stance. P argues that tenure of the lordship is sufficient.
– Issue: Can lord prevent outsiders from using his land in a way that benefits the public?
– Holding: Common legal prescription does not necessarily hold if the act of another is being done for the good of all, albeit the act may cause some loss without injury to the recipient of the act.
– To claim that freedom to K or engage in eco activity w/o being unduly or capriciously burdened. (this is to encourage eco activity)
– Should not restrain eco activity for one person
– This case recognizes that we have a natural right to contract for economic activities if our activities provide a economic benefit to society
J. People v. Williams (1907) – Autonomy Theory
– Facts: Woman found working in factory after 9pm, NY statute debarred a woman from doing this. D in trial court argued that the statute was unconstitutional.
– Issue: Is a state statute that proscribes workers female from working in a factory at their own discretion unconstitutional?
– Holding: Appeals court affirmed this by saying the fundamental law of the state, as embodied in its constitution, provides that no person shall be deprived of life liberty or property w/o due process of law. D was let go and appeals court affirmed decisions.
– Back then, judges brought up on a diet of natural law theory and found themselves having to justify their ruling by basing some on a document (constitution)
– The court in this case uses “liberty” as a means of recognizing a Natural Rig

in to a royal justice of breach of promise in following ways:
– Case of Covenant: π alleges that the ∆ promised or agreed to do something and has not done it. If π’s case rests solely on breach of promise. Rules applied: trial of factual issues by jury (know customs), π’s argument failed unless promise was in sealed writing, jury would set damages for breach, justices would not order the ∆ to perform the promise.
– Case of Debt: π alleges that the ∆ was indebted to him and ∆’s promise made for something, quid pro quo, separated debt from covenant actions. Π couldn’t proceed unless amount of damages was certain, ∆ may elect trial by jury or “wager of law” (swearing that he is not indebted or producing 11 oath helpers to swear with him). Courts did not punish perjury until 1563.
– P would have preferred another method of recovery to debt: They exercised caution by putting their transactions in writing and under seal; promise to have promisor pay a penalty (penal bond set the damages) in debt sur obligacion
Change in the Renaissance: In 1500s, royal courts settled on another remedy for breach of promise. Trespass existed as an action to bring against someone who commits something wrong against another, as in the Bible KJV (jury resolved factual disputes and set the damages). Trespass was expanded to Trespass on the case expanded trespass to cover pleas that did not warrant relief covered by any other action and came to cover breach of promises, actionable in the