Contracts Outline (Prof. Imwinkelried)
General Definition: A K is a promise or set of promises, for breach of which the law provides a remedy, or the performance of which the law in some way recognizes as a duty.
Imwinkelried believes a full-fledge definition for K doesn’t exist, therefore the above definition is just a tentative working guide
Imwinkelried’s model of “a K” includes:
iii. Plaintiff did his/her part
iv. Defendant did not
v. Plaintiff will suffer economic injury as result of D’s breach of K
Policy: legal protection for honest, reasonable expectations of performance by other party. Can’t have regional and national markets if no protection for honest, reasonable expectations of future performance.
Law Governing Ks: Common Law (CL) generally governs Ks. However, Ks for sale of goods (i.e. things that are movable) governed by Article 2 of Uniform Commercial Code (UCC). CL still applies to Ks for sale of goods, but rules in UCC that conflict w/ CL override CL.
C. Types of Ks
Types of Ks as to formation: Ks frequently described as express, implied, or quasi. Only first two are actually Ks, and they differ in manner in which they are formed.
i. Express K: formed by language, oral or written
ii. Implied K: formed by manifestations of assent other than oral or written language, i.e., by conduct
1. Implied-in-fact: e.g., taking sick dog to vet w/o saying anything. Thru conduct, one is expected to pay for vet’s services.
2. Implied-in-law: e.g., child gets injured, goes to ER, docs operate w/o consent of parents. Parents have to pay despite their absence of consent.
Types of Ks as to validity
i. Enforceable K: legal duty to perform, so if there’s a breach, then there’s a direct legal remedy.
ii. Unenforceable K: innocent party can’t obtain direct legal/judicial remedy, but court may recognize that a K still exists.
iii. Executed K: all of the promised performance has been rendered.
iv. Executory K: (before or during performance).
1. Can be partially executory, if only part performance has been rendered.
2. Can be completely executory, when no performance has been executed.
v. Voidable K: at least one party has option to avoid or terminate the K. Innocent party can terminate at will when it feels it has been victimized.
vi. Void K: when subject matter is illegal, the
al (offer) and the other agrees to it (acceptance).
i. Two theories of Mutual Assent
1. Subjective Theory (dominant in CL)
a. “Meeting of the minds” must be shown by each party. This looks at subjective states of mind of each person, it is internal.
b. This theory used at CL but still lingers on today
c. Problems arise b/c it’s difficult to prove state of mind
i. Circumstantial evidence and actions after the fact must be relied on to prove state of mind, thus making it hard
2. Objective Theory (dominant modern theory)
a. Outward manifestation of intent is used to determine parties’ intent to enter into a K.
b. This is determined using a “reasonable person” as standard for interpretation, i.e., would a reasonable person believe a party intended to enter into a K. Doesn’t look at what parties’ actual intentions were.
Lucy v. Zehmer: after negotiations and a K entered into, D said no K b/c he was just joking. Held: K b/c it was reasonable for P to believe that D did intend to enter into K b/c P thought (and Ct determined) that D was serious.