Law Notes: Contract Law
June 18th, 2025 10:07 am![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
vampiricproseContract Law
Vocab:
Contract: a set of mutual promises or obligations that may be legally enforced against a party who breaches it
Offer: a clear proposal to enter a contract, intended to create a binding agreement upon acceptance
Unqualified Agreement: agreeing with no changes
Acceptance: an unqualified agreement, completing the contract formation
Mutual Assent: a shared understanding and agreement on the essential terms of a contract
Performance:
Substantial performance: performance that fulfills the contract’s essential purpose, even if minor details are incomplete or imperfect
Material Breach: a serious failure to perform that justifies the other party in terminating the contract
Third Party Beneficiary: someone who is not a party to the contract but is intended to benefit from it and may have rights to enforce it
Assignment: the transfer of contractual rights or duties to a third party
Counteroffer: a response to an offer that modifies its terms, effectively rejecting the original offer
Parol evidence: external evidence, like emails or conversations, used to clarify the meaning of written contract terms
Breach of Contract: Failing to perform contract obligations
Express Contract: parties clearly set forth the terms of their agreement verbally or in a written contract
Implied Contract: A court finds that the parties have formed an implied contract based on the conduct of the parties or facts of a situation
Promissory Estoppel: When one party relies on the agreement to their detriment and is typically unsupported by consideration. Courts can apply contract-like principles to enforce a promise that is not supported by consideration.
Indefiniteness: missing terms. Generally do not invalidate a contract
Mirror Image Rule: requirement that the offeree must accept all of the offerer's original terms
Mailbox Rule: assists a court in deciding which action is valid when the communication of an acceptance and revocation isn’t instantaneous. Acceptance is valid as soon as it is sent, and a revocation is valid as soon as it is received.
Consideration: a bargained-for performance or return promise
Mutual Consideration: If only one party is actually bound by the agreement, then the consideration is treated as illusory and the contract is unenforceable.
Unconscionability: one of the parties lacks meaningful bargaining power in entering an unreasonably favorable contract to the other contracting party.
Condition: Something that has to happen (unless excused) before someone’s duty to do something under a contract starts.
Express condition: a condition that is explicitly stated in the agreement
Implied Condition: a condition that arises by implication based on the nature of the transaction or conduct of the parties
Condition precedent: contractual requirements that must be met before a party’s obligation begins
Condition subsequent: A condition that occurs after the performance has begun
Objective standard: judging something as an outsider would understand it
Quid Pro Quo: something for something
Legal detriment: When someone gives up a right or benefit they were allowed to keep.
Contract recital: short introductory section at the beginning of a contract that explains the background or purpose of the agreement. An example of this would be, “This contract is made with reference to the following facts:”.
Boilerplate Clauses: Standardized clauses that appear at the end of most contracts that cover general legal provisions like governing law or dispute resolution.
Phases of a Contract:
Offer
Acceptance
Consideration
Types of Contracts:
Unilateral
Type of agreement where both parties make promises to do something
Bilateral
Type of agreement where only one party is making a promise in exchange for a performance
Determining whether the Parties Have Manifested an Intent to be Bound:
The language of the preliminary agreement
Whether there are terms left open
Whether there has been a partial performance
Overall context of the negotiations
Any relevant customs involving these types of transactions
Types of Termination of an Offer:
Rejection
Why? It terminates the power of acceptance
Revocation
Why? Revocation is when the offeror manifests and intends not to enter into the proposed agreement, meaning no contract was formed.
Lapse
Why? Lapse means that the offer has expired due to the offeree not responding to the offer within the specified time or within a reasonable time; therefore, the contract was never formed.
Death
Why? They’re dead. They can no longer perform.
Promises are Illusory if:
Performance is so indefinite that it cannot be enforced
It is entirely optional
Contracts that Seem Illusory but are Enforceable:
Requirement Contracts
the seller promises the buyer that he will sell goods to the buyer in any quantity that the buyer requires
Output Contracts
The buyer promises to purchase everything the seller can producer
These contracts are seemingly illusory because they lack any definite promise to perform.
Requirements for Promissory Estoppel:
The promisor made a clear and definite promise to the promisee
The promisee relied on that promise to their detriment
The promisee’s reliance was expected and foreseeable
Factors for Determining Unconscionability:
Whether both parties have equal power when signing the prewritten contract
Whether the parties had an opportunity to read or familiarize themselves with the document before signing
Whether there was a use of fine print in the portion of the contract containing the provision
The relationship of the parties, including factors of assent, unfair surprise, and notice
Unconscionability also requires that the terms themselves be unfair, which depends on the commercial reasonableness of the transaction.
Contract Law Has 2 Questions:
Did the parties create a valid, enforceable contract?
What remedies are available when one party breaks the contract?
If the Contract is Enforceable and Valid:
The parties reached an agreement (offer and acceptance)
Consideration was present (the same “price” was paid for what was received in return)
The agreement was legal
The parties entered into the contract with capacity to make a contract
The agreement is in the proper form (something written, if required)
Boilerplate Clauses in Legalese vs Plain Language:
Clause #1: Integration
Legalese: This Agreement, together with any affixed schedules and exhibits, constitutes the entire understanding between the parties with respect to the subject matter of this Agreement and supersedes any prior discussions, negotiations, agreements, and understandings.
Plain Language: This Agreement and its attachments contain the entire understanding between the parties.
Clause #2: Choice of Law
Legalese: This Agreement will be governed and controlled in all respects by the laws of the State of Florida, including interpretation, enforceability, validity, and construction.
Plain English: This Agreement will be governed and interpreted by Florida law.
Clause #3: Choice of Forum
Legalese: The parties submit to the jurisdiction and venue of the Circuit Court for the County of _____, State of Florida or, if original jurisdiction can be established, the United States District Court for the 5th District of Florida with respect to any action arising, directly or indirectly, out of this Agreement or the performance or breach of this Agreement. The parties stipulate that the venues referenced in this Agreement are convenient.
Plain Language: Any lawsuit arising directly or indirectly out of this Agreement will be litigated in the Circuit Court for ___ County, Florida, or, if original jurisdiction can be established, in the United States District Court for the 5th District of Florida.
Clause #4: Notice
Legalese: All notices and other communications required or permitted under this Agreement will be in writing and will be deemed given when delivered personally or by registered or certified mail, return receipt requested, addressed as follows (or any other address that is specified in writing by either party):
Plain Language: All required notices must be in writing and will be considered given when delivered (1) personally, or (2) by registered or certified mail, return receipt requested, addressed as follows (or any address specified in writing by either party):
Clause #5: Waiver
Legalese: Seller's failure to exercise a right or remedy or Seller's acceptance of a partial or delinquent payment will not operate as a waiver of any of Seller's rights or Purchaser's obligations under this Agreement and will not constitute a waiver of Seller's right to declare an immediate or a subsequent default.
Plain Language: A waiver of a breach of any term in this Agreement will not be considered (1) a waiver of a further breach of the same term, or (2) a waiver of a breach of any other term, or (3) a waiver of Seller's right to declare an immediate or a subsequent default.
Clause #6: Severability
Legalese: Whenever possible, each provision of this Agreement will be interpreted in such a way as to be effective and valid under applicable law. If a provision is prohibited by or invalid under applicable law, it will be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Agreement.
Plain Language: Each provision of this Agreement must be interpreted in a way that is valid under applicable law. If any provision is held invalid, the rest of the Agreement will remain in full effect.
Clause #7: Amendments
Legalese: The terms of this Agreement may not be varied or modified in any manner, except in a subsequent writing executed by an authorized representative of both parties.
Plain Language: The parties can amend this Agreement only by a written document signed by both parties.
Clause #8: Assignments
Legalese: No assignment of this Agreement or of any right or obligation under this Agreement will be made by either party without the prior consent of the non-assigning party.
Plain Language: A party cannot assign this Agreement or any right or obligation under the Agreement without the prior consent of the other party.
Clause #9: Remedies Cumulative
Legalese: The remedies provided in this Agreement will be cumulative, and the assertion by a party of any right or remedy will not preclude the assertion by such party of any other rights or the seeking of any other remedies.
Plain Language: The remedies provided in this Agreement are cumulative. A party who asserts a right or seeks a remedy may also assert other rights or seek other remedies.
Clause #10: Successors and Assigns
Legalese: In the event of a proper assignment, this Agreement will be binding upon and inure to the benefit of the parties' successors and assigns.
Plain Language: If this Agreement is properly assigned, then it will bind and benefit the successors and assigns of the parties.
Clause #11: Risk of Loss
Legalese: Risk of loss concerning the goods sold under this Agreement will pass upon the occurrence of the following event:
Plain Language: The risk of loss of goods sold under this Agreement will pass when: (event to be specified).
Clause #12: Confidentiality
Legalese: The parties agree that the existence of this Agreement and the specific terms of this Agreement will remain confidential and will not be disclosed to third parties.
Plain Language: The parties must keep this Agreement confidential and must not disclose either the existence or the terms of the Agreement to third parties.
Clause #13: Relationship of Parties
Legalese: In its relationship with Party A, Party B is an independent contractor. Nothing in this Agreement will be construed such that Party B will be considered an employee, agent, or partner of Party A.
Plain Language: Party B is an independent contractor for Party A, and is not an employee, agent, or partner of Party A.
Clause #14: Counterparts
Legalese: This Agreement may be executed in one or more counterparts, each of which will be deemed an original agreement, but all of which will be considered one instrument and will become a binding agreement when one or more counterparts have been signed by each of the parties and delivered to the other.
Plain Language: This Agreement may be signed in one or more counterparts. Each counterpart will be considered an original, and all together will form one binding Agreement.
Clause #15: Injunctive Relief
Legalese: The parties acknowledge that irreparable injury will result from the failure of either party to comply with the terms of this Agreement. In the event of any actual or threatened default or breach of any of the provisions of this Agreement, the aggrieved party will have the right to specific performance or injunctive relief, as well as monetary damages and any other appropriate relief.
Plain Language: If either party breaches this Agreement, then the other party will be irreparably injured. Therefore, if one party breaches or threatens to breach the Agreement, the other party may seek specific performance, injunctive relief, monetary damages, or any other appropriate remedy.
Clause #16: Survival Clauses
Legalese: The following paragraphs of this Agreement will survive for a period of ___ years subsequent to the termination of this Agreement.
Plain Language: Paragraph numbers ___ of this Agreement will survive for ___ years after the Agreement ends.
Clause #17: Force Majeure
Legalese + Plain Language: Seller will not be deemed to be in default or otherwise responsible for delays or failures in performance resulting from acts of God; acts of war or civil disturbance; epidemics; governmental action or inaction; fires; earthquakes; unavailability of labor, materials, power, or communication; or other causes beyond Seller's reasonable control.
Clause #18: Title
Legalese: Titles and headings to articles, sections, or paragraphs in this Agreement are inserted for convenience of reference only and are not intended to affect the interpretation or construction of the Agreement.
Plain Language: Titles and headings are inserted in this Agreement for reference purposes only and must not be used to interpret the Agreement.
Clause #19: Attorney Review
Legalese: The parties represent that they have carefully read this Agreement and have consulted with their attorneys. The parties affirmatively state that they understand the contents of this Agreement and sign this Agreement as their free act and deed.
Plain Language: The parties (1) have consulted with their attorneys, (2) have read and understood the Agreement, and (3) sign the Agreement on their own free will.
Clause #20: Third-Party Beneficiaries
Legalese: This Agreement will not confer any rights or remedies on any third party, other than the parties to this Agreement and their respective successors and permitted assigns.
Plain Language: This Agreement confers no rights or remedies on any third party, other than the parties to this Agreement and their respective successors and permitted assigns.
Clause #21: Attorney Fees
Legalese: In the event of a dispute arising out of this Agreement, the prevailing party will be entitled to actual attorney fees and costs.
Plain Language: If a dispute arises out of this Agreement, then the prevailing party will be entitled to actual attorney fees and costs.
