Contracts: Formation, Defenses, and Remedies
Formation and the Common Law/UCC Divide
Begin every contracts question by classifying the subject matter. Goods go to UCC Article 2; services, land, and everything else go to common law. Then test the three formation elements: offer (present intent to be bound, definite terms, communicated to the offeree), acceptance (mirror-image at common law; UCC 2-207 permits a contract despite differing terms), and consideration (a bargained-for exchange of legal detriment).
Defenses and Enforceability
Memorize the Statute of Frauds categories (marriage, year, land, executor, goods of $500 or more, surety) and the exceptions: part performance, specially manufactured goods, admission, payment. Other defenses include duress, undue influence, unconscionability, mistake, misrepresentation, and impracticability/frustration.
Performance, Breach, and Damages
Distinguish conditions, substantial performance, and material breach, and remember anticipatory repudiation. Remedies are expectation (put the plaintiff where performance would have), reliance, and restitution. Expectation damages are limited by foreseeability (Hadley), mitigation, and certainty; liquidated damages must be a reasonable forecast, not a penalty.
Traps
Past consideration is no consideration; a preexisting duty is no consideration; UCC modifications need no consideration. An option or firm offer is irrevocable. A purported acceptance that adds terms is a counteroffer at common law but may still form a contract under the UCC.
Worked Example
A offers to sell a bicycle for $200. B says, "I accept if you include the helmet." At common law this conditional acceptance is a counteroffer, so no contract exists. If the bicycle is a good, UCC 2-207 may treat the exchange as a contract with the added term analyzed for materiality. Rule of thumb: ask "goods or not?" before anything else.