As a result of the verdict, the incentives to avoid waste are off. Hobbs v. Massasoit Whip Co. F: Shipment of eel skins; no contract per se; D did not contact shipper w/ acceptance or rejection. ), BUT this is not necessarily so. $ M Œ ­ æ ç [ \ ³ Ü ; ~ ı ø ø ò ı ı ğ ë æ á æ Ü Ü æ × × Ñ ı ı ı Ï ı É „Ğ`„Ğ „Ğ^„Ğ Access This Case Brief for Free With a 7-Day Free Trial Membership. EXISTENCE OF AN OFFER OFFER: Restatement (2d) §24: Defines an offer as “the manifestation of willingness to enter into a bargain so made as to justify another person in understanding that his assent to that bargain is invited and will conclude it.” [Supports objective standard] Restatement (2d) §26: No offer if person being addressed knows or should know that offer is not being made. Facts:. Discuss the calculation that’s on the website. H: Contract fails for lack of time term, and thus not enough terms to determine a remedy for breach. Brown v. Oliver F: Sale of a hotel; dispute over whether or not the price included the hotel furniture. This is not a promissory estoppel case because the promise wasn’t gratuitous. Parties disagree about which boat “Peerless” the goods had to arrive on. Specific Performance granted. price has fallen. \ However, following his sentencing, Ford began to display symptoms of a serious mental disorder. BUT, if it appears that you agreed to do more, then there is consideration. ³ H: Ct. holds that Lumley leads to a mitigated form of slavery and that enforcing a negative pledge is simply indirect compulsion. Ford had worked as a Deputy Sheriff for several years when another driver crashed into her patrol vehicle, severely injuring Ford’s dominant right hand. 912, 127 L.Ed.2d 358 (1994). [Empty distinctions: Performance isn’t difficult under frustration; just less valuable.] If damages are fully compensatory, and promisor is fully solvent, does the requirement of consideration for modification ever matter? Dmgs. (Johns v. Ward, 170 Cal.App.2d 780, 789, 339 P.2d 926; 4 Witkin, Cal. If it makes $250K more, then they break even altogether. You can search by the SCC 5-digit case number, by name or word in the style of cause, or by file number from the appeal court. Kimberly Lake Legal Environment of Business Popejoy T/Th 12:30 GRIMSHAW v. FORD MOTOR COMPANY California Court of Appeals 119 Cal.App.3d 757, 174 Cal.Rptr. Garnishments limit risk to debtor because there are other ways to get the money besides suits for damages. [UCC has specific values listed (20% or $500) for breach in the absence of liquidated dmgs.] See also Schools v. Walker, 187 Va. 619, 629–30, 47 S.E .2d 418, 423 … If it’s a central term, it is likely very important, and thus cost of completion should be awarded. Shutting down an unprofitable business is a sound business decision. H: The purpose was frustrated; Question: Did they throw the ctct out, thus putting the loss on the lessor? Yes. P wants expectation dmgs: value of coins less rental fees. Brief Fact Summary. Whether (1) it is unconstitutional to execute an incompetent person, and (2) the procedural issue of whether Florida's statutory scheme for evaluating the competency of a condemned prisoner meets the … The ct. will consider the function of the difference more than the appearance. Notes on SP: An argument for SP: A contract price is the value of the item to the seller, not the purchaser. Pace car wasn’t unique in the traditional sense, because there are 6,000 of them, but it is unique because it would be “impossible to obtain its replication without considerable expense, delay and inconvenience.” Question: Is this liberal and open-ended portion of the UCC applicable for our purposes? B. The way I see it, no one party in this hypo is less educated as to the grounds for confusion than the other. In the meantime, you can find it here. Doctrine of Consideration is mandatory and not waivable. They are concerned with a different efficiency, that of the tripartite arrangement alone, not mkt. It’s the best we have. If the price falls, he will not buy at all. Ford Motor Co. had a surplus of almost $112 million. U sued to enforce the promise. And so, in reality, there isn’t always a strict consideration doctrine and the Cts. “The meeting of the minds which is essential to the formation of a contract is not determined by the secret intention of the parties, but by their expressed intention [which may be contrary to their true intention].” Texaco v. Pennzoil F: Texaco shared some dealings with SEC, and others with Getty. That is, a fixed price contract usually has that fixed price specifically because the parties want to assign the risk of market fluctuation, and the ct. can’t just find an excuse because the market fluctuated! You could look at how central the term is in the contract, though. Hypo: If buyer is reseller of iron, he buys (at the contract price) only when the price increases, and thus has an option. See §250 and §2-610. H: Ct. holds that Lumley leads to a mitigated form of slavery and that enforcing a negative pledge is simply indirect compulsion. CONFLICT w/ UCC §2-205 (Firm Offers): Under the UCC a written guarantee to leave the offer open is not revocable for lack of consideration during the time stated (or, if not stated, for a reasonable time not to exceed 3 months). If the Court could tally the amount of her suffering for doing Big Country, then the Ct. could (would?) Sometimes it’s the promisee seeking more pay, and sometimes it’s the promisor saying he’s being taken advantage of. value of the Replicar is $12K. All that remains is offeror’s performance. Note: Ct. would probably never tell a lessee that it should have made a change because it would have maximized joint welfare, because the ct. can’t/won’t be sure that the change would have worked; too speculative. Adler: The verdict may be what it is because the best guess is to read silence as a noncondition (QUESTION: What does that mean?) She refused. Caveat: Promisor’s threat here may not be too credible, b/c of reputation. Question: What did Adler say here about the question of intent? That’s what the court is trying to do. Shippers with unusual items must protect themselves. Abel: If “in principle” isn’t redundant with “subject to”, then “in principle” must be read to say “not really”; that is, “in principle” makes the explicit terms subjective and hypothetical, despite Texaco’s ruling to the contrary. H: Impracticability defense fails; The events of the crisis were reasonably foreseeable at the time of the contract and Gulf thus did or should have contemplated the contingency. H: Reasonable reliance on bid does constitute acceptance (given custom of industry), and forms a contract, but because a real contract is formed, this is NOT a promissory estoppel case; it’s just a regular ctcts case, and thus, expectation damages are awarded, not reliance. Probably b/c ignorance of the more narrow term is more likely than ignorance of the broader term Or maybe, because seller was new to the business, the court finds it more likely that seller wasn’t operating with the more narrow term, and was in fact operating on the Ag. [A fiduciary duty is a duty to look out for the other’s interests, so that’s different, but irrelevant for our purposes.] ACCEPTANCE See Restatements on page 319-320. Dodge v. Ford Motor Co., (1919);. Crim. WRITINGS AS EVIDENCE If there is an integrated written agreement that appears comprehensive, a party cannot claim a prior agreement that states something different than the written agreement. There’s no such thing as reliance damages! There is no explicit negative pledge in the contract. Morrow v. First National Bank of Hot Springs. (UCC calls this “no quantity default”). The Canadian price changed over time, and the ct. cannot be sure if the ctct price would change with it, in proportion to it, or not at all. Quimbee California Bar Review is now available! What Ford seeks is an opportunity to retry the case so that it can ask for instructions differentiating the two claims in a new trial. Mirror Image Rule: If parties don’t agree to the exact same terms, there is no contract. Plumbers flood the mkt. Ford could have … Crim. If they had agreed to keep option open for $5, then it’d be binding. Alternative approach: A material breach, or failure of substantial performance, can be considered an anticipatory repudiation of the contract, so, in Hypo 2 the buyer can say the seller’s inaction is a repudiation and the ctct is dead. Frigaliment Importing Co. F: Seller thought chicken included fowl; Buyer thought otherwise. Normally renegotiation would fix the inefficiency, but here the promisee (captain) doesn’t have to renegotiate, so inefficiency results. Will you call me as soon as it’s available?” NOW it’s quite possible that they have a contract. 11, 14. unilateral mistake case, as the mistake was about the terms of the supposed contract, not about the world. July 25, 1986) Brief Fact Summary. Bush v. Canfield (1818) F: Contract for flour. We use the term consideration in this context, but it is really only meant to apply to gratuitous promises; it happens, but it misconstrues consideration. Restatement (2d) § 347: Expecation: Lost profits + incidental losses – costs avoided UCC § 1-106: Expectation dmgs. Does a choice between two things qualify as a range? SO, in theory you want to do away with the mitigation doctrine so that Parker and future Parkers will go out and work. That’s the plight of interpretation when individuals interact without a focused eye on consistency and parsimony. So why not award lost profits then? I think he must, since many of our cases here aren’t gratuitous promises; I believe he’s just reinforcing that we aren’t studying true promissory estoppel as seen in consideration, but rather general detrimental reliance.) Stilk v. Myrick F: After two sailors deserted, the remainder were offered and accepted more $ to stay. Implied Warranty of Merchantability: (General; see UCC §2-314) Example: It is generally understood that wheels shouldn’t fall off of roller skates, regardless of the type of skate they are. Does it have to be? (Pure expectation calculation: He should have paid B, earned $9400, and gotten $100 from A to reach his expectation.) 105, 512 A.2d 389, 1986 Md. Then, he says, Bambino could sue Coop and capture that surplus. The court rules the opposite of Paradine and finds that the possibility was not considered, but the best default rule is one that relieves the party of its burden if performance is genuinely impossible through no fault of the promisor. Knowledge of revocation is enough to nullify the ctct; needn’t be direct notification, just manifestation to offeree (somehow). Upon breach, Ford brought suit for specific performance of the written agreement. At long last, here is the case brief for Ford v. Duncan. DISSENT: “Different or inferior” is not a matter of law; it’s a matter of fact and should be decided at trial. What cts. H: Court sides with Phoenix’s estate and says that being alive is an implicit condition of the contract, and that the loss should be borne by the employer. Bush wants to use restitution ($5K) and Canfield wants expectancy (because Bush benefited $3K for mkt. would require explicit negative clause. H: The rule of damages is the value of the article at the time and place of delivery plus the interest for the delay. INTERPRETING ASSENT Empty terms, Subjectivity, Importance of Context Empty Terms At times, present, explicit terms will be deemed empty and thus no contract is formed. (Note mention of “good faith” & “fair dealing”). H: No contract. Where the buyer is a pure speculator, the contract will not be enforced for lack of mutuality. Adler: Seems like the ct. just feels bad for her. (Question: What does this mean?) Ct. sometimes says contemplation that it’s a remote possibility is the same as absence of contemplation, but that’s wrong. Because in the case of doctors it’s easy, but in the case of publishers, for example, it’s harder. And didn't your client appear in that case? No consideration for the option. YES! Hamer v. Sidway F: Nephew agrees to give up drinking in exchange for money from uncle. (Question: Is this law, or dicta? The parole evidence rule helps you to eliminate cheaply and quickly what you think is extremely likely to be a lie. Moving to variant A is legitimate, because it maximizes/improves the welfare of the business (and thus society), but moving to B, while it also helps him and hurts the lessor, is bad faith because it hurts the business itself, and it sure seems like bad faith to endanger the overall profitability of the enterprise (and thus hurt the other party). For the casebooks listed we brief all the cases portrayed in the case book and not the Notes cases. Dept. 87-6796 Argued: November 6, 1990 Decided: February 19, 1991. Case Summaries. And, moreover, this is a bad default rule because the opera house/lessor is in the best position to prepare for this eventuality (fire) and pay for it (by adjusting prices accordingly) CAN v. Phoenix F: Phoenix is dead and can’t perform. Johnson v. Otterbein F: Donor agrees to give $ to university if used to pay back debt. Ford filed a bill in equity in the district court, demanding that Jermon be required to act as agreed, but also be enjoined from acting at any theater not managed by him. Reasonable person standard. The good faith/bad faith distinction is hazy and problematic, but we need something to prevent that flagrant violation of an implicit term. Hypo: If you see your neighbor’s retaining wall collapsing while she’s away, will you fix it? Strangely, the term was central, but the court found that it wasn’t. BUT, we expect them to behave rationally and now there are studies that show they sometimes do not, & systematically. [Or, if the U didn’t have to pay back its debts b/c it was bankrupt, then there would be consideration.] Publisher pursued it but offered no compensation. H: NO consideration. Posner says the economic argument is a perfect one ex ante, but if the parties agree to it ex ante, then they should be bound to it, no matter what happens ex post. $5K was paid in advance. SP compromises efficient breach, but not severely, because you just hand over the land (there is no spilling of paint, etc. Restatement (2d) §29: Manifested intentions of the offeror determines who has the power to accept MISSING TERMS: Restatement (2d) §33; UCC §2-204: Few terms are essential to formation of an enforceable ctct; Must only provide a basis for determining existence of a breach and for giving appropriate remedy. Maybe we don’t like the idea of people binding themselves SO tightly to contracts. BUT, what if Baker values the paint job at $10,500? H: There was no implied promise to pay. The doctrine protects the ignorant party, but not to help him; it protects the ignorant party to prevent the resulting inefficiency (because he’ll overinvest expecting more favorable terms, and will be disappointed, and deal with an inefficient loss, if the other party’s terms are used). View Team B-IRAC_WK5.pptx from LAW 531 at University of Phoenix. Two reasons parties would include LD that look like penalties but aren’t: Possibility that breach will not be discovered readily. Florida Panthers Hockey Club, Ltd., v. Miami Sports And Exhibition Authorit 939 F.Supp. Were it not for the boiler plate terms, the ct. would be on its own in determining the default rules. Hypo: If I give you $10K on the condition that you give me $500, that’s not enforceable. 2013-P-0091 - vs - : GENE A. FORD, et al., : Defendant-Appellant. Sedmak: Limited edition pace car is unique. The Bush rule does not give you the right outcome in this case. 1 Facts 2 Issue 3 Decision 4 Reasons 5 Ratio Duff-Gordon was a celebrity who attached her name to products to help them sell in return for payment. P Injunction granted. Goodman) Restatement clouds the issue because it reflects all these incorrect holdings. The car is also not unique enough. The fishermen will breach, and it’ll be inefficient, and there will be no renegotiation because there is a strict consideration doctrine in place. Very difficult to calculate expectancy: people value unique goods differently. Mutual Life v. Tailored Woman F: Tenant transferred furs out of the gross-revenues room. WARRANTIES Warranties can be explicit or implicit. This case concerns the reformation of an irrevocable trust. Thus, the court uses the definition of the Agriculture Dept. as the contract with Tongish, plus handling fee, then the Ct. could use expectation damages. Buyer must, in fact, rely upon the seller’s skill or judgment. Read our student testimonials. If not, should such a condition be imputed as a matter of law? MUTUAL MISTAKE In short, if the parties intended to lay the arising loss on one party, the ct. will try to lay the loss with that party. United States Supreme Court. Adler: The ct. is trying to punish the breaching party, but that’s troubling, because there are no bad actors in contracts. Peevyhouse H: Ct. looks to the centrality of the term to assess its importance. So, if the cost of performance is 5, the contract price is 1, and L is 100, they’ll perform. and ctct; Tongish wants to award handling fee only (expectation). Arguably the store is just looking out for all its customers generally, and keeping prices lower with this policy, but the ct. seems influenced by the fact that the clerk knew she couldn’t pay and was just preying on her with this clause. §213: The Parole Evidence Rule: A binding written agreement discharges prior inconsistent agreements. If the response to an offer includes new or different terms, it’s not an acceptance under common law, but is a counter-offer. Can he, or is the contract absolutely thrown out? We see no reason to allow Ford to do so. Upon breach, Ford brought suit for specific performance of the written agreement. Restatement (2d) § 63: In general, “unless the offer provides otherwise, an acceptance made in the manner and by a medium invited by an offer is operative and completes the manifestation of mutual assent as soon as put out of the offeree’s possession.” (see also § 66) UNILATERAL CONTRACTS There can be acceptance by performance if the offer permits (or, as with subs and contractors, if that is the custom in the industry). DOCTRINE: A requirements contract is valid as long as the buyer has real requirements, not illusory ones, and therefore the seller has some chance of profit. Loveless found out and retracted the offer. This begs the question, though, of whether the omission of the description should have been viewed as objective evidence that the parties did not intend to have formed a contract at that point. CC–85–1385.80 (C. C. Mobile Cty., Ala., Feb. 12, 2016), pp. Sedmak v. Charlie’s Chevrolet (1981) F: Oral contract for Indy 500 Pace Car; $500 deposit made; special requests for car made and included. Adler: This comes down to a simple issue: Was fertility an implicit term of the contract? In this divestiture action under 7 of the Celler-Kefauver Antimerger Act, the Government challenged the acquisition by appellant, Ford, the second largest automobile manufacturer, of certain assets of Electric Autolite Co. (Autolite), an … This is not about breaching and suing: If you have substantially performed, you are more a performer than a breacher, and have rights to sue under the contract. Issues Also, it’s feasible that Little, Brown assumed he didn’t want compensation because he never mentioned it. Sometimes the neighbor will be able to show that he/she did want the wall to collapse, but otherwise you could win. The result is the same when, for whatever reason, the cost of performance is particularly high (say the seas are really high, but, of course, the original ctct is still binding), as long as the net worth is still lower than the net of C-P. Second, where the parties have agreed to a range of terms, each party should have an option to enforce a contract on the terms most favorable to the other party. DamagesNegative PledgesNoIn the era of debtor’s prisons, upholding damages would lead to imprisonment, making enforcement of damages equally objectionable.If you can’t work for anyone else, you have to work for the original employer, which is the same exact result as indentured servitude.YesWe don’t really favor human dignity over market efficiency at every point; there are necessary limits. Failure to award damages based on idiosyncratic value would lead to underinvestment (by promisor), while an award of damages for a holdup would lead to overinvestment (by promisor). 2d 776 Brief Filed: 1/00 Court: Court of Appeals of California Year of Decision: 2001. H: Bad faith: D cannot hurt annual gross receipts (enterprise) to break the lease. studentjd,studentjd.com,www.studentjd.com,www.4lawschool.com,case briefs,law school,lawschool,kaplan,lsat,outlines,tests PETITIONER:Ford RESPONDENT:FordLOCATION:Beaumont Mills DOCKET NO. MERE KNOWLEDGE OF THE FORESEEABILITY ISN’T SUFFICIENT TO MAKE A BINDING CONTRACT; THERE MUST BE A TACIT ACCEPTANCE TO ASSUME RESPONSIBILITY FOR THOSE DAMAGES. In this case, D offered no such proof, so calculating negative lost profits is too speculative. Uses Ct. assumes Coop is not liable to Bambino, and that they wanted Bambino to bear the risk of mkt. 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