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Contracts
Vermont Law School
Firestone, David B.

What is a Contract?
A promise or set of promises, which the law in some way recognizes as a duty; for breach of which the law gives a remedy to protect people
Breach a party’s failure to perform some contracted for or agreed up act or failure to comply with a duty imposed by law which is owed to another or to society

What is the purpose for contracts?

Economic growth

Builds strong economy (strengthens the economy
Establishes and maintains credit system

Keeps order in society
Discourages breach
Provides compensation for breach
Lowers possibility of retaliation

The Mechanics of an Offer & Acceptance: (Interpretation)

Objective Intent / External – What the party expressed or seemed to have meant.

The standard is to a reasonable person

Subjective Intent / Internal – What a party really meant, there state of mind

The meeting of the minds standard

Objective is used b/c you cannot read what is in a person’s mind

Issues: We need to know for an offer

What were the words?
What do they mean?
What would a Reasonable Person interpret those words to mean?

We are looking at your outward manifestations and what they mean to a Reasonable Person

Latent Ambiguity – Where the words of a K to a reasonable person appear to be ambiguous, there is no K (Embry v. Hargadine, McKittric Dry Goods Co & Raffles v. Wichelhaus [Peerless or Peerless])

Counter-argument – To Reasonable Person there was no ambiguity

What Constitutes an Offer?

Expression of present/current intent to enter into a K
Has to be clear, definite, and explicit; & leaves nothing for negotiation…acceptance of which is a contract

Preliminary negotiations are unenforceable – everything that is out there but never got to an offer

Rules for Advertisements:

They are an invitation to receive offers form the public
The advertiser has the option to accept, negotiate or reject the public’s offer to buy

He is not bound until he accepts

Before the K is made the seller may modify or revoke the offer

Does the Offer still exist? If you have an offer, which continues to exist, then you go to acceptance

Ways in which an offer can cease to exist:

Revocation – (Dickinson v. Dodds)

o doubt

No mirror-image = no K

The acceptance may not impose additional conditions on the offer nor may it add limitations
Exception: original offer remains open when offeree indicates intent to keep offer “under advisement”

Have to indicate to a RP that you are keeping the offer open

Offer Acceptance

1 1
2 2
3 3
4 4
5 (Proposal)

Common Law says that this is not a “K”
2-207 (1), using the analogous approach, it is a “K” if it is definite & seasonable
2-207 (2) what happens to the additional terms: it is a proposal (becomes part of the K if the offeror accepts) if both parties are merchants it becomes part of the K unless either (a) offer expressly limits acceptance to the terms of the offer, (b) they materially alter it, (c) notification of acceptance has already been given or is given within a reasonable time after notice of them is received

The evolvement of the law is b/c this promotes commerce…changes in society contracts done for the sale of goods through the use of form contracts