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Temple University School of Law
Smyth, Sophie E.

Contracts Outline

Formation of a Contract requires 2 basic elements: (1) the Mutual Assent of the parties and (2) some showing that this assent is the Kind that the law will enforce

Public Policy

Restatement (Second) of Contracts

§ 178 When a Term Is Unenforceable on Grounds of Public Policy
(1) A promise or other term of an agreement is unenforceable on grounds of public policy if legislation provides that it is unenforceable or the interest in its enforcement is clearly outweighed in the circumstances by a public policy against the enforcement of such terms.
(2) In weighing the interest in the enforcement of a term, account is taken of
(a) the parties’ justified expectations,
(b) any forfeiture that would result if enforcement were denied, and
(c) any special public interest in the enforcement of the particular term.
(3) In weighing a public policy against enforcement of a term, account is taken of
(a) the strength of that policy as manifested by legislation or judicial decisions,
(b) the likelihood that a refusal to enforce the term will further that policy,
(c) the seriousness of any misconduct involved and the extent to which it was deliberate, and
(d) the directness of the connection between that misconduct and the term.

§ 179 Bases of Public Policies Against Enforcement
A public policy against the enforcement of promises or other terms may be derived by the court from
(a) legislation relevant to such a policy, or
(b) the need to protect some aspect of the public welfare, as is the case for the judicial policies against, for example,
(i) restraint of trade (§§ 186-188),
(ii) impairment of family relations (§§ 189-191), and
(iii) interference with other protected interests (§§ 192-196, 356).

Shaheen v. Knight

w D filed an initial objection, based on an absence of a cause of action.
w Defendant (Dr. Knight) argues:
w No action because implied warranty of cure/guaranteed results iaw PA             state law
w No damages

ng so. 

In the Matter of Baby M (NJ 1988)
A pseudonym for an actual person

Defense Argues (pg 25)
1. Contrary NJ adoption laws, ie) illegal baby-buying
2. Violated consent procedures of adoption laws
3. Joint shared joint custody
4. ignores best interest of the child
5. exploits surrogate mother
6. undermines “family values”
7. economically elitist, unequal bargaining power

Trial court refutes all of these and rules in the favor of the Steins, upholding the terms of the contract.

Supreme court overturns, because it violates public policy and is contrary to state statutes.

State statutes
w Private placement
w $$ exchange
w MaryBeth Whitehead’s decision was irrevocable
w Whitehead agreed not to contest

Public policy
w Custody of the child should not be determined pre-birth.