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1. Note whether this transaction is governed by UCC or the Restatement. 2. Does the Statute of Frauds apply?

The contract must be in writing if it is in regard to land, if by its nature it takes more than one year to perform, or if it is in regard to goods of greater than $500 value.

Is there a contract?
Was there an Offer? Were the terms specific? Did the offer indicate the partys intent to be bound?


Was there an Acceptance? Was there acceptance to exact terms of the offer pursuant to mirror image rule? If not, can UCC 2.207 or the parties performance be used to imply a contract? Was the acceptance made according to offers to instructions (note silence can never be acceptance)? Was the acceptance made within time specified? Does the mailbox rule apply? Yes Was there Consideration? Was there legal detriment? No No Was there reliance so that 90 Promissory Estoppel applies? Was there benefit conferred?


No contract



Are all of the material terms agreed on? No Yes THERE IS AN ENFORCEABLE CONTRACT What are Material Terms? Unilateral or Bilateral? Was there an outright breach or is it another problem? No Yes Were parties far enough in negotiations to implicate a contract to negotiate in Good Faith? Was such a contract explicit? Was an option created by partial performance of acceptance?

Was there Substantial Breach?


Was there fraud, duress or unconscionability?

Yes Breach is excused

No Was there a change in circumstances or failure of a substantial assumption of the contract? Yes No

Breach is excused

Could there be a waiver? Was the breach excused by implication of past performance? Yes Breach is excused No Breach unexcused; victim can recover GO TO DAMAGES

Is there vagueness/ambiguity in contract?

Can the Courts fill in vague/ambiguous terms (Note: the court will not fill in material terms) according to: Writing in the contract Past performance of the contract Past dealing in other contracts Usage/Custom Can the Parol Evidence rule apply to clarify situation? EXCEPTIONS TO PAROL EVIDENCE fraud/duress unclear terms scribners error



If courts cannot interpret contract themselves and parol evidence cannot be admitted, the contract will be void for vagueness.

Was there Mistake?

Mutual R152 Unilateral R153

Was the mistake as to a basic assumption? Yes Contract Voidable No G.U.

Contract enforceable Risk allocation: R154, always restitution and fairness

Was the mistake Scribners Error or General Unilateral? S.E.

Did the other party know or have reason to know of the mistake? Yes No

If parties have agreed to terms, and only the written document is defective, a meeting of minds occurred and the contract is enforceable on original understood terms. R155

Contract is voidable under R153

Contract is voidable if party does not bear risk of mistake by R154. Also note that risk is allocated depending on fairness; court will also see whether risk has been allocated contract itself.

Was there a SURPRISE?

If contract term is unconscionable, court will refuse to enforce it. R208, U2.302 Could also argue breach of good faith U1.203, R 205

Did dealings breach Good Faith?

There is a warranty of good faith in every contract negotiation process R205, U1.203


If covered by UCC, 2.209 If covered by Restatement, 148

Under the UCC, no consideration is necessary for a waiver if it is in good faith AND it is written

Was there consideration given for the modification? No Yes

Was the modification sought in good faith due to changed circumstances? No Was the modification based on Waiver? Yes Modification is enforceable

Modification is enforceable



Modification is unenforceable

Was waiver revoked with sufficient notice? Yes No Waiver is enforceable

Waiver properly revoked; modification unenforceable

Legal Equitable when remedy at law is inadequate SPECIFIC RELIEF


Is there a liquidated Damages Clause in the contract? Yes No Are the liquidated damages a fair estimate of expectation damages? No Yes


Specific Performance

Look to Expectation Damages which are the benefit of the bargain, intended to put the victim where he would be if the contract had been performed: Are they either: $0 or negative in amount; Uncertain (i.e., new venture); or Excessive given circumstances? No Yes

Court will enforce liquidated damages

Is specific performance of the contract will be awarded ONLY if: Contract is clear The remedy at law is inadequate There is mutuality of performance Uniqueness makes it impossible to assess damages

Expectation Damages awarded

Reliance damages awarded intended to put the victim where he would be had the contract never been made. These can include: Lost opportunity Difference between market value and value as is

NOTE: No punitive damages No damages for mental distress Has everyone mitigated/covered? RESTITUTION always an option

Restitution Damages
Has there been: Unjust Enrichment; Partial Performance; OR Benefit knowingly conferred but not under contract? Yes No

Is Plaintiff the breacher? Yes Damages will be benefit conferred but limited to contract price No

No Restitution damages

Damages will be the amount of benefit conferred, regardless to whether Lower price was specified in contract; or Contract would have resulted in a loss