Contracts I

Chapter 1: Basis for Enforcing Promises

  1. Enforceable Promises: An Introduction
    1. Contract: a promise or set of promises for the breach of which the law gives a remedy, or the performance of which the law recognizes as a duty.
      1. O+A+C=K
    2. Promises: all are not enforceable, even if written & signed. Promises that lack an essential are not a contract & are essentially hot air. In order for there to be a contract the promise must be legally enforceable.
    3. Types of Contracts: 2-> bilateral & unilateral
      1. Bilateral: 2 promises. Promise for a promise.
      2. Unilateral: only 1 promise. Promise for performance
    4. Sources of Law: the Restatement (more than commentary, but less than law), the U.C.C., & case law. The law of Contracts developed through case law is fluid & reflects the tensions between the individual freedom to negotiate terms & enter binding contracts, & the public interest in various types of social control. The Restatement (2nd) was issued to refine the 1st & correlate with the U.C.C.
    5. Hawkins v. McGee (1929)-> distinguishing a promise from a belief
      1. Issue: Whether there is evidence that the D’s promise of a particular surgical outcome constitutes an offer to enter a contract?
      2. Holding: Yes. There was an offer, a contract, & it was breached.
      3. Reasoning: There was evidence that the D repeatedly solicited from the P’s father the opportunity to perform the operation (O). There would be the reasonable basis then for the conclusion that if the D spoke the guarantee, he did so with the intention that it should be taken at face value, as an inducement, & there was ample evidence that it was so accepted (A). In addition, the father paid for the surgery (C). Therefore, there was a legally binding contract (O+A+C=K).
      4. Notes
        1. 100%: the father based his action on this guarantee. His expectation interest was a perfect or good hand.
        2. What makes a statement a promise? Intent of the promisor. What is the expectation/perception of the other side?
        3. The court had to decide initially whether the words could possibly have been meant as intending to form a contract? MD said his inducement merely represented his belief that the procedure would be a success. The law doesn’t look to subjective belief/intent of the individual(s), but rather the objective interpretation of those words & actions. The test is what a reasonable person in the position of each of the respective parties would be led to believe by the words & conduct of the other party. This is the Objective Theory of Contracts (see Lucy v. Zelmer). Words & actions mean a whole lot. One word can make all the difference.

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