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Welcome back to our review of contract law we’re ready to start on the main question one in contract law remember we’ve broken down this entire field into three, different questions: the right has a legally enforceable contract: been created has that contract been successfully performed and finally. If not what are the remedies for breach now we’re going to start with question number one contract formation has an enforceable contract informed in other words what does it take to get one of these contracts things anyway now.
We’re going to be discussing for big topics in this area first the agreement process or offer and: acceptance second consideration and also some related theories about. When you have to keep your promises third defenses to contract formation these are things like incapacity or duress that sort, of thing and finally something called the statute of frauds if you want something to help you remember this right you might think of this as a CD s all contracts don’t stink you can actually have some really nice.
Contracts are going to be working: through our ads over the next several series of lectures now let’s start with the agreement process the transaction process itself. Just a quick word to the wise this is something that: law professors love to test on the right .The agreement process can have lots of back and forth there can be some nuances here, so this is something that sometimes you may see on your exam.
Now a contract is typically created by in agreement and apparently an agreement the acceptance rights we might have an: we might have an acceptance where they say sure, or we might have something called the counter offer right which it says how about we go skating instead what.
What we want to do is look a little more carefully get each of these the offer acceptance and the : counter offer all of which make up part of the agreement process. Let’s start with the supply side what’s an offer well an offer.
The person that makes that is called the offer or, and it’s going to create a power of acceptance the power of acceptance in the offered right so what’s a very simple, example I will buy your car for five thousand dollars right that’s an offer now this may sound very obvious, but there are some nuances to offers and I think it’s a little bit easier to remember how this works by animalizing the process by analyzing the process, and I’ve brought some props so I want you to think of the offer as a caterpillar right cute fuzzy.
But ultimately very fragile now: if you accept the offer, then this thing called the caterpillar turns into a beautiful butterfly ride. You’ve got a contract and it’s a thing of beauty that you’ll remember, forever but until it’s accepted right you just have this offer this caterpillar squirming around on the ground .
Remember caterpillars are very fragile offers are very sensitive once quashed right once the offer is destroyed you can’t scrape up a dead caterpillar off the ground and turn it into: a butterfly ride it squashed you can’t revive it How do you create a legal offer how do you create a legitimate offer for major: points to cover here the first offer and acceptance are governed by the objective test the object of tests and all this means is that outward appearances of words .
Actions is what matters right :the outward appearances of your words and actions is what is important not your secret intentions right the key question is whether the offer or displays and objectively serious intent to be bound .Let’s take a look at problem number eight I offer to sell you my jeep wrangler for five thousand dollars but and in my mind I’m thinking huh of course. i don’t mean it there’s do we have a contractual agreement the answer is yes it doesn’t matter what subjectively going through my mind the objective test is going to control.
I am going to be bound by that offer that: I made even though in my soul I may not have thought :I was really making a serious offer now the way to catch one of these problems is to look for situations involving humor or anger those are things to watch out for where the offer or take a look at problem are everywhere I’m pulling and yanking at wires . I kick the side of the jeep and yell out excel this funny junker for five dollars you drive by, and you yell out the window I accept do we have a: contractual agreement no right no under the objective test.
I’m not displaying a serious intent to be bound I don’t really want to sell this I’m just really, upset what about expressions of opinion take a look at problem 10 we are talking casually in the law school parking lot when I leaned up against my jeep wrangler and I ask you how much do you think this whole thing is worth :
I say I accept do we have a contract no right no you need a serious intent to be bound right you didn’t have a serious intent to be bound you weren’t making me an offer you are just expressing an opinion second. Related to offers, the proposal must usually be directed to a specific offer read in other words you can’t accept an offer unless it’s directed at your problem.You hear themis bar review pass rate that there are a bunch of good deals to be had on W all Street so you walk down through the trading pit and you say I accept I accept I accept do you have any contract with the stock traders know right these offers aren’t specifically directed towards you-
You can’t accept an offer that’s not directed your way now there is one limited exception here for contests offers or reward Lord offers where there’s a promise that.When someone promises something to anyone that accomplishes a particular task, this isn’t really an exception to the rule right it’s just they’re extending that offer to anyone that wants to accept it’s an open offer to anyone take a look at problem 12.
I’ve lost my pet cat named Monster, and I take out a newspaper advertisement promising a : hundred dollars to anyone who finds my cat by this Friday you see the ad you find, monster and you yes trustemo this isn’t the way. We normally contract but if you have a situation like this with a reward offer that spread: out broadcast to the entire world than anybody can accept that offer .
if they do what was the offer ask them to do third different parallel universes remember we have common law universe and UCC universe and the two universes treat this slightly differently at common law all essential terms all essential terms must be covered in the agreement. This typically means the parties the subject the price and the quantity those are the key terms: now are you CC universe is a little less strict here the law is more willing to plug the gaps and to find a contract even though.