Maine Law School 1L Study Guide for Contracts

Maine Law School 1L Study Guide for Contracts

Contracts is a fundamental course in law school that examines the creation, interpretation, performance, and enforcement of agreements between parties. In this study guide, we will cover the key concepts relevant to contract law, with attention to both general U.S. principles and specific nuances under Maine law.

1. Formation of Contracts
   • Offer: An offer is a clear and definite proposal made by one party (offeror) to another (offeree) indicating a willingness to enter into a contract.
   • Acceptance: Acceptance is the unconditional agreement to the terms of the offer by the offeree.
   • Consideration: Consideration is what each party gives up to the other in the agreement (e.g., goods, services, money, promises).
   • Mutuality of Obligation: Both parties must have some obligation under the contract.
   • Competency and Capacity: Parties must have the legal capacity to enter into a contract.
   • Legality: The purpose of the contract must be legal.

   Case Law Example: Lucy v. Zehmer (1954) – A case that determined the objective standard in assessing the parties’ intent to form a contract.

• IRAC for Lucy v. Zehmer:
  • Issue: Whether a contract was formed when Zehmer, jokingly, agreed to sell his farm to Lucy.
  • Rule: A contract exists if the parties’ outward expressions demonstrate an intent to contract, regardless of secret intentions.
  • Analysis: The court held that, despite Zehmer’s contention that he was drunk and joking, the objective appearance of the agreement indicated a serious contractual agreement.
  • Conclusion: The court enforced the agreement as a valid contract.

1. Defenses to Formation

   • Misrepresentation: A false statement that induces the other party to enter into the contract.
   • Duress: Improper threat or act that coerces a party to enter into a contract.
   • Undue Influence: Excessive pressure by a dominant party over a weaker party.
   • Unconscionability: A contract that is so unfair to one party that no reasonable person would have agreed to it.
   • Mistake: A belief that is not in accord with the facts, which can be mutual or unilateral.
   • Illegality: If the contract’s subject matter is illegal, the contract is void.
   • Statute of Frauds: Certain types of contracts must be in writing to be enforceable.
2. Terms of the Contract
   • Express Terms: Specific provisions set forth by the parties.
   • Implied Terms: Provisions not expressly stated but implied by law or the parties’ conduct.
   • Parol Evidence Rule: Prevents the introduction of evidence of prior or contemporaneous negotiations that would alter, contradict, or add to the terms of a written contract.

   Maine Specifics: Maine follows the Restatement (Second) of Contracts and the Uniform Commercial Code (UCC) for the sale of goods, with local variations.

3. Performance and Breach

   • Complete Performance: Full performance according to the contract terms.
   • Substantial Performance: Performance that, while not complete, fulfills the essential purpose of the contract.
   • Material Breach: A failure to perform that allows the other party to terminate the contract and sue for damages.
   • Anticipatory Repudiation: An assertion or action by a party indicating that they will not perform their contractual obligation.

   Case Law Example: Jacob & Youngs v. Kent (1921) – A case dealing with substantial performance versus complete performance.

• IRAC for Jacob & Youngs v. Kent:
  • Issue: Whether the use of a different brand of pipe, not specified in the contract but equivalent in quality, constitutes a breach of contract.
  • Rule: A party who has substantially performed in good faith is entitled to payment, less any damages for the deviation.
  • Analysis: The court held that the contractor’s failure to use the specified brand did not substantially alter the contract’s value.
  • Conclusion: The contractor was entitled to payment, less the cost of any resulting damages.

1. Remedies

   • Damages: Monetary compensation for breach, including compensatory, consequential, punitive, and nominal damages.
   • Specific Performance: A court order requiring a party to perform their contractual obligations.
   • Rescission: Canceling the contract and returning the parties to their pre-contract status.
   • Reformation: Changing the terms of the contract to reflect the parties’ true intentions.

   Maine Specifics: Maine may allow for unique remedies or interpretations of damages based on state statutes and case law.

2. Third-Party Rights

   • Assignment: A transfer of rights under a contract to a third party.
   • Delegation: A transfer of duties under a contract to a third party.
   • Third-Party Beneficiary: A non-party to the contract who stands to benefit from its performance.

   Maine Specifics: Maine follows general U.S. principles regarding third-party rights, but local case law may provide specific applications.

3. Discharge and Excuse of Performance

   • Impossibility/Impracticability: Situations where performance becomes objectively impossible or impracticable.
   • Frustration of Purpose: When an unforeseen event undermines a contract’s fundamental purpose.
   • Accord and Satisfaction: An agreement to accept a different performance in satisfaction of the original obligation.

   Maine Specifics: Maine courts will interpret these defenses in light of the Restatement and relevant state precedents.

This study guide provides an overview of key concepts in contract law, tailored to a 1L course. When studying, it is crucial to understand the principles, read and brief the cases, and be able to apply the rules to hypothetical situations, with attention to Maine’s specifics when applicable.