End of Semester Review

1. End of Semester Review Announcements office hours—Tuesday, May 9, 11am-3pm Wednesday, May 10, revised hours--1pm-4pm Part 1: Structured review Part 2: Q & A End of Semester Review

2. Today is an excellent day to review contracts. End of Semester Review

3. Typical Executory K prelim. executory negotiations period -----------------|-------------------------|---------------------- t K formation performance due focal point during the second half of this semester: figuring out what the rights and duties of the parties are to ascertain whether there has been a breach of a duty and what the appropriate remedy should be End of Semester Review

4. A sues B • K • A asserts that B breached a duty owed under K • duty may be • express term, subject to interpretation and parol evidence rule • implied term • result of a modification • possible responses by B • I did not owe this duty because _________ • I may avoid or disaffirm the K because ____________ • even if the K existed and the duty would otherwise be owed, I was justified in not performing because of ________________ End of Semester Review

5. Duty • express term • K interpretation • parol evidence rule • implied term—default rules/gap fillers • later—we’ll add modification End of Semester Review

6. subjectivist approach: Raffles v. Wichelhaus K for the sale of cotton to arrive “ex Peerless from Bombay” October Peerless—buyer’s understanding December Peerless—seller’s understanding Subjective v. objective (redux) End of Semester Review

7. Restatement §20. Effect of Misunderstanding (1) There is no manifestation of mutual assent to an exchange if the parties attach materially different meanings to their manifestations and (a) neither party knows or has reason to know the meaning attached by the other; or (b) each party knows or each party has reason to know the meaning attached by the other. (2) The manifestations of the parties are operative in accordance with the meaning attached to them by one of the parties if (a) that party does not know of any different meaning attached by the other, and the other knows the meaning attached by the first party; or (b) that party has no reason to know of any different meaning attached by the other, and the other has reason to know the meaning attached by the first party. End of Semester Review

8. §201. Whose Meaning Prevails (1) Where the parties have attached the same meaning to a promise or agreement or a term thereof, it is interpreted in accordance with that meaning. (2) Where the parties have attached different meanings to a promise or agreement or a term thereof, it is interpreted in accordance with the meaning attached by one of them if at the time the agreement was made (a) that party did not know of any different meaning attached by the other, and the other knew the meaning attached by the first party; or (b) that party had no reason to know of any different meaning attached by the other, and the other had reason to know the meaning attached by the first party. (3) Except as stated in this Section, neither party is bound by the meaning attached by the other, even though the result may be a failure of mutual assent. End of Semester Review

9. Joyner v. Adams North Carolina Court of Appeals 87 N.C. App. 570, 361 S.E.2d 902 (1987) End of Semester Review

10. Frigaliment Importing Co. v. B.N.S. International Sales Corp. United States District Court 190 F. Supp. 116 (S.D.N.Y. 1960) End of Semester Review

11. What does the court look at? • term itself • other provisions in K • negotiations/communications • course of performance • course of dealing • trade usage End of Semester Review

12. C & J Fertilizer v. Allied Mutual Insurance Co. Supreme Court of Iowa 227 N.W.2d 169 (1975) End of Semester Review

13. Reasonable Expectations Doctrine • majority rule • narrow and broader versions • narrow—requires ambiguity • broad Restatement 211? probably too limiting, favoring too much the “stronger” party; probably not followed by many courts End of Semester Review

14. canons of interpretation • contra proferentum • ejusdem generis—e.g., K to sell farm with “cattle, hogs, and other animals”—would this include the prior owner’s family dog? sheep? • expressio unius exclusio alterius—e.g., K to sell farm with “cattle and hogs”—family dog? sheep? • n.4, pp. 358-59 End of Semester Review

15. Thompson v. Libby Minnesota Supreme Court 34 Minn. 374, 26 N.W. 1 (1885) End of Semester Review

16. 1. What is the parol evidence rule? See also Restatement §213; UCC 2-202 End of Semester Review

17. 2. What is parol evidence? End of Semester Review

18. 3. When does the parol evidence rule come up? End of Semester Review

19. Visual PER may be likened to a semi-permeable membrane that surrounds an executed writing Executed Writing Extrinsic evidence Extrinsic evidence Extrinsic evidence End of Semester Review

20. Different visual prelim. executory negotiations period -------------------|-------------------------------------|------------------- t K formation performance due prior contemp. oral subsequent oral or oral or written contemp. written written PER applies End of Semester Review

21. When the parties have reduced their understanding to a writing, the court must decide what the parties intended by the writing.--not integrated--integrated End of Semester Review

22. If integrated, and not dealing with contradictory parol evidence, the question now turns to the degree of integration.--Traditional 4 corners approach--Modern contextual approach End of Semester Review

23. Integration--turns on the intention of the parties with regard to the writing they execute. • 4 corners rule, p. 385 • Under this rule, where do you look to determine the intention of the parties? • Compare with the modern, contextual approach End of Semester Review

24. 4 & 5--application • a. Traditional, 4 corners approach • b. Modern, contextual approach End of Semester Review

25. modern, contextual approach • as with the 4 corners approach, integration depends on the intention of the parties • under this rule, where do you look to determine the intention of the parties? • under this approach, a writing cannot establish its own completeness • court looks at the writing and the offered parol evidence and then makes a determination re: intention of the parties End of Semester Review

26. 4 corners v. modern contextual • with each, court asks—when the parties have reduced their agreement to a signed writing, what inference are we to draw for two matters: (1) the finality of the terms contained therein; (2) the completeness of the writing—does it embody the complete agreement of the parties so that parol evidence is inadmissible End of Semester Review

27. Levels of integration • complete integration • partial integration • not integrated at all End of Semester Review

28. Merger or integration clause • e.g., Entire Agreement. This document constitutes the entire agreement of the parties and there are no representations, warranties, or agreements other than those contained in this document. End of Semester Review

29. interpret/explain admissibility turns on ambiguity difference in jurisdictional approach add to/vary admissibility turns on integration (1) is the writing integrated? [are the terms in the writing final?] (2) how integrated is it? [is the writing complete/exclusive?] PER(1) parties execute a writing(2) one or both attempt to introduce extrinsic evidence End of Semester Review

30. add to/vary • admissibility turns on integration • (1) is the writing integrated? [are the terms in the writing final?] If no, then writing doesn’t bar extrinsic evidence; if yes, then contradictory evidence is excluded; if dealing with evidence of a consistent additional term, must ask the second integration question re: degree • (2) how integrated is it? [is the writing complete/exclusive?] End of Semester Review

31. add to/vary • (2) how integrated is it? [is the writing complete/exclusive?] 4 corners—does the writing appear complete on its face; merger/integration clause nearly dispositive modern contextual—factors—completeness of writing; merger/integration clause; transactional setting; parties End of Semester Review

32. Exceptions • 1. Collateral agreement. Even a completely integrated writing does not exclude a collateral agreement. Key points are subject matter + consideration. • 2. Evidence to show no valid agreement. Example--one party wants to introduce evidence that the writing was produced as a joke. Admissible because it is offered to show that there was no valid agreement. It doesn't mean that you will win. • 3. Evidence that would allow one party to avoid the contract. Evidence to establish any of the policing doctrines from the previous chapter is admissible--fraud, misrepresentation, duress, etc. • 4. Mistake, fraudulent misrepresentation. Although mistake under certain circumstances allows a party to avoid the contract, mistake here refers to where the parties, by mistake, fail to include a term in the contract. Evidence is admissible which may lead a court to reform the contract to reflect the intent of the parties. • 5. Oral condition precedent. Written K might be subject to oral condition precedent not contained in writing. End of Semester Review

33. 1. Collateral agreement. Even a completely integrated writing does not exclude a collateral agreement. Key points are subject matter + consideration. End of Semester Review

34. 2. Evidence to show no valid agreement. Example--one party wants to introduce evidence that the writing was produced as a joke. Admissible because it is offered to show that there was no valid agreement. It doesn't mean that you will win. End of Semester Review

35. 3. Evidence that would allow one party to avoid the contract. Evidence to establish any of the policing doctrines from the previous chapter is admissible--fraud, misrepresentation, duress, etc. End of Semester Review

36. 4. Mistake, fraudulent misrepresentation. Although mistake under certain circumstances allows a party to avoid the contract, mistake here refers to where the parties, by mistake, fail to include a term in the contract. Evidence is admissible which may lead a court to reform the contract to reflect the intent of the parties. End of Semester Review

37. 5. Oral condition precedent. Written K might be subject to oral condition precedent not contained in writing. End of Semester Review

38. Taylor v. State Farm Supreme Court of Arizona 175 Ariz. 148, 854 P.2d 1134 (1993) End of Semester Review

39. Levels of integration • not integrated at all • partial integration • complete integration End of Semester Review

40. Merger or integration clause • e.g., Entire Agreement. This document constitutes the entire agreement of the parties and there are no representations, warranties, or agreements other than those contained in this document. End of Semester Review

41. Exceptions End of Semester Review

42. Taylor v. State Farm Supreme Court of Arizona 175 Ariz. 148, 854 P.2d 1134 (1993) End of Semester Review

43. ambiguity • 4 corners plain meaning approach End of Semester Review

44. ambiguity modern contextual approach • is the express language reasonably susceptible to the meaning that the party is trying to establish? End of Semester Review

45. Nanakuli Paving & Rock Co. v. Shell Oil Co. United States Court of Appeals 664 F.2d 772 (9th Cir. 1981) End of Semester Review

46. express K term • “Shell’s Posted Price at time of delivery.” End of Semester Review

47. express terms • course of performance • course of dealing • trade usage End of Semester Review

48. what is a waiver? End of Semester Review

49. Wood v. Lucy, Lady Duff-GordonNew York Court of Appeals222 N.Y. 88, 118 N.E. 214 (1917) End of Semester Review

50. Leibel v. Raynor Manufacturing Co.Kentucky Court of Appeals571 S.W.2d 640 (1978) End of Semester Review