Kansas Law School 1L Study Guide for Contracts
Introduction to Contract Law
- Definition of Contracts: A contract is a legally enforceable agreement between two or more parties with mutual obligations.
- Offer and Acceptance: The basic components of a contract where one party proposes a deal, and the other accepts.
Offer
- The Objective Test: An offer is judged by what a reasonable person in the position of the offeree would believe.
- Definiteness: The terms of the offer must be clear enough to provide a court with a basis for giving an appropriate remedy.
- Communicated to Offeree: The offer must be communicated to the person it is intended to bind.
Acceptance
- Mirror Image Rule: Acceptance must be an unequivocal assent to the terms of the offer.
- Mailbox Rule: Acceptance is generally effective upon dispatch when sent in a manner expressly or impliedly authorized by the offeror.
- Battle of the Forms (UCC § 2-207): In the sale of goods, acceptance with different or additional terms can still form a contract, subject to certain conditions.
Consideration
- Definition: Something of value or a detriment incurred by the party receiving the promise.
- Bargained-for Exchange: Consideration must involve a bargained-for exchange between the parties.
- Pre-Existing Duty Rule: Performing an existing duty is not sufficient consideration for a new promise, unless there is new or different consideration.
- Past Consideration: Past actions do not constitute consideration for a new promise.
Defenses to Contract Formation
- Incapacity: Parties lacking capacity, such as minors or those with mental impairments, may not be held to a contract.
- Duress: Contracts formed under threats or improper pressure can be void or voidable.
- Undue Influence: Contracts may be voidable if one party has taken advantage of their influence over the other.
- Misrepresentation and Fraud: A contract based on material misrepresentation can be voidable.
- Mistake: Mutual mistake can render a contract voidable if it pertains to a basic assumption on which the contract was made.
Performance and Breach
- Complete Performance: Fulfillment of all contract terms to the satisfaction of the other party.
- Substantial Performance: Performance by a contracting party that deviates only slightly from complete performance.
- Material Breach: A failure to perform that permits the other party to the contract to either compel performance, or collect damages because of the breach.
Remedies
- Damages: Monetary compensation for breach of contract.
- Expectation Damages: The amount needed to put the injured party in the position they would have been in had the contract been fulfilled.
- Reliance Damages: Compensating the party for costs incurred due to relying on the contract.
- Restitution: Restoring to the aggrieved party any benefit conferred to the other party.
- Specific Performance: A court order requiring the breaching party to fulfill the terms of the contract, usually in cases where the subject matter is unique.
Third-Party Rights
- Assignment: Transfer of a party’s rights under a contract to a third party.
- Delegation: Transfer of a party’s duties under a contract to a third party.
- Third-Party Beneficiary: Someone who was not a party to the contract but stands to benefit from it.
Statute of Frauds (Kan. Stat. Ann. § 33-106 et seq.)
- Certain types of contracts must be in writing to be enforceable, such as contracts for the sale of land or goods over a certain value, or contracts that cannot be performed within one year.
Case Law
Hawkins v. McGee (1929)
Issue: Whether the defendant’s promise of a “100% good hand” was a guarantee that could be enforced.
Rule: The measure of damages is the difference between the promised result and the actual result.
Analysis: McGee promised Hawkins a 100% good hand but the surgery resulted in a worse condition. The court awarded the difference in value between a perfect hand and the hand as it was, plus any incidental damages.
Conclusion: The defendant breached his promise, and the plaintiff was entitled to damages.
Hammer v. Sidway (1891)
Issue: Whether a promise to refrain from drinking, smoking, and gambling until the age of 21 in exchange for money is enforceable, despite the absence of tangible consideration.
Rule: Consideration can consist of either a detriment to the promisee or a benefit to the promisor.
Analysis: The nephew’s forbearance of legal rights is a sufficient detriment to constitute consideration.
Conclusion: The uncle’s promise was enforceable, and the nephew was entitled to the money.
Carlill v. Carbolic Smoke Ball Company (1892)
Issue: Whether an advertisement for a reward constituted an offer that could form a contract upon performance of the conditions stated in the advertisement.
Rule: An offer can be made to the world at large, and a contract is formed when someone performs the conditions stated in the offer.
Analysis: The company’s advertisement and deposit of money showed their intention to be bound.
Conclusion: Mrs. Carlill was entitled to the reward upon using the smoke ball as directed and contracting influenza.
Conclusion
This study guide provides a brief overview of key concepts and case law relevant to a first-year contracts class with a focus on Kansas law. It is crucial to understand the specific statutes and case precedents of Kansas when preparing for exams. Students should also familiarize themselves with the Kansas Uniform Commercial Code (UCC) for topics related to the sale of goods. Always consult the latest legal texts and rulings to ensure up-to-date information.