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Contracts
Wayne State University Law School
White, Katherine E.

I. INTRODUCTION TO CONTRACT
A. Definition of K§ 1: promise for breach of which law gives remedy, or the performance of which the law in some way recognizes as a duty, obligation that require compensation NOT punitive
Agreement/Bargain §3: Agreement is a manifestation of mutual assent on the part of two or more persons.  A bargain is an agreement to exchange promises or to exchange a promise for a performance or to exchange performances. Bargain = mutual assent + consideration §17
B. Remedies: reveal difference in underlying theories of obligation
C. Shaheen v. Knight: P was operated on by D to make him sterile but still had kid.  P sues for breach.  Against public policy to enforce bc no ‘warranty of cure’.  Child as damages inappropriate bc other remedies not in contract (adoption). Unenforceable on ground of public policy §178 [57] D. Restatement
1. Promise; Promisor; Promisee; Beneficiary:
a. promise is a manifestation of intention to act or refrain from acting in a specified way, so made as to justify a promise in understanding that a commitment has been made.
b. Where performance will benefit a person other than promisee, that person is a beneficiary.
3. Agreement Defined: Manifestation of mutual assent on the part of two or persons.  Bargain is agreement to exchange promises or to exchange a promise for a performance or to exchange performances.
4. How a Promise May be Made: May be stated in words either oral or written, or may be inferred wholly or partly from conduct (silence when there’s a duty to speak, for example).
E. Assumpsit: enforcement of private commitments NOT family
F. Freedom to Contract: allows society to agree on what it can and cannot contract for. 
G. UCC: when contract is mixed, classify contract according to dominant element, goal of uniformity
1. Article 2: only applies to sales of goods(defined as “moveables) (Art 1 general provision)
2. when difference between CL and UCC, apply UCC
3. apply more specific provision
H. Restatement:
II. DAMAGES
I. Factors for Damages/Situations for Breach: To determine party in breach, ask who willing to perform
A. Damage Interests
1. Expectation (benefit of the bargain): promisee in the position would be in had promise been performed.  Includes profits § 347 [68] “forward looking”
2. Reliance (detrimental reliance): promisee back in the position in which the promisee would have been in had the promise not been made. Doesn’t count lost profit. “look backwards”, status quo bfore K
a. P still under duty to mitigate
b. purpose: meant to protect parties acting in good faith upon another’s promise
3. restitution (unjust enrichment): Put the promisor back in the position in which the promisor would have been had the promise not been made. Promisor disgorge benefit
4. Expectation (GM) = Loss in Value + Other Loss – Costs Avoided – Loss Avoided  a. loss in value: value of contract, (profit)
b. other loss: breach causes other loss, party entitled recovery if foreseeable
1. incidental UCC 2-715 (occur after breach in reasonable attempt to avoid further loss (ie cover, storage cost, employee overtime) or
a. cover: good faith effort to find reasonable substitute goods without unreasonable delay 2-712
2. foreseeable

wice of what was selling to Coop for.  $5000 difference.  Thomas doesn’t pay Tongish and Tongish sues Thomas to get paid.  Coop intervenes and argues damages because G breached K.  Say damages should be Market Price – Contract Price (5000) while Tongish argues that damages should be just the lost profits under K price (455)
Issue: whether Coop entitled to position would be in if promise fulfilled (455) or difference btwn market price and contract price (5122).  Awards 5122, should have awarded position if K fulfilled (455)
Reasoning: Market price – contract price, outcome discourages breach
Analysis: Efficient breach but Coop never lost anything bc had agreement to sell seeds at the same $ bought them at (not in mrk, therefore no mrt $ – k $)).  Ruling unjustly enriches Coop.
2) No matter what, Tongish can get the best price.  If market low = K.  If market is high, breach. 
C. Cover §2-172: Coop had to cover by finding another seed supplier.
Buyer may recover from seller as damages the difference bwtn the cost of cover and K price together with any incidental or consequential damages. [85] B.  Limitations on Damages
K price limit, expectation interest provides “upper” limit, still limitations on that amt unless express clause
1. Forseeability of Damages
a. Characteristics