Contracts
Contracts tests formation, enforceability, performance, breach, and remedies under common law and Article 2 of the UCC. Distinguish common-law rules from UCC rules whenever goods are involved, and watch for statute-of-frauds and parol-evidence issues.
Core rules
- A contract requires offer, acceptance, consideration, and no defense; UCC 2-207 governs additional or different terms in a sale of goods.
- The statute of frauds requires a writing for land, suretyship, marriage, one-year contracts, and goods over $500.
- Parol evidence cannot vary integrated terms but may explain ambiguity, show a condition precedent, or prove a defense.
- Expectation damages put the nonbreaching party in the position performance would have produced.
Worked example
On Monday, A offers to sell B a car for $5,000 and promises to keep the offer open until Friday. B pays $100 for an option. On Wednesday A revokes. On Thursday B accepts. Reasoning: The option is a separate contract supported by consideration, so A's revocation is ineffective. B's acceptance before Friday forms the sale contract. Without the $100, A could revoke before acceptance because a promise to keep an offer open is normally unenforceable absent consideration or a UCC firm offer.
Traps
- Applying common-law mirror-image acceptance to a UCC sale of goods.
- Missing that a merchant's firm offer under UCC 2-205 needs a signed writing and no consideration.
- Using parol evidence to contradict an integrated term.
- Forgetting mitigation and foreseeability in damages.