September 1, 1998

Look at the following to see if a contract can be applied:

- Nature of relationship (legally and in fact)

- Nature of service provided

- Amount of time involved

• When it was done

It is mother and a step child. Step child is general contractor (puts out bids and supervises construction of commercial properties). This step child paints inside of 3000 square foot of mother’s house. Does it during Christmas vacation. Became a step child when he was 10 years old. Is now 40 years old.

Apply Rules to Facts:

It seems clear that the step son in this situation did the work for his mother voluntarily without expecting to be paid for his services. He noticed the house needed painting and painted it without the mother expressly wishing him to do so. He is not in the business of personally painting residential homes so it is not as if he did this as a business venture. His job is biding on and supervising the construction of commercial properties. This is much different than painting his mother’s home. Another reason that would lead a judge to find no expectation of reparations is the fact that this work was done during Christmas vacation. In addition the mother paid for the supplies which relieves the son from any financial burden.

Discussion of student and law school contract. Does school have contract with student?

Page 116 of book.

The university shall provide an accredited 4 year education in …

Parole Evidence – whether parties have executed (signed) a document or documents setting forth their respective obligations, is there anything beyond the contract which is part of the contract?

Parole evidence rule – under what circumstance does the document(s) discharge, and ban introduction of evidence of, prior agreements and contemporaneous oral agreements?

Parties signed document(s) -

Time line of forming a contract:

1. negotiations
2. oral or written agreements
3. sign document(s) (could be parol evidence here at same time)
4. modification of agreement oral or written.

Does there have to be some writing showing the contract to be enforceable? Some states require some writing to accompany oral agreements.

September 3, 1998

Do contract exercise in groups of 3-5. Also look up CALI exercise in library. (described in syllabus)

Draft contract as posted on ERES. DUE September 17 in class. Will take around 6 hours.

Was the agreement between Capital City and Seagrams a completely integrated agreement such that an agreement for Capital City to give the Lees’ another distributorship?

Ordinary expectation:

• different negotiations
• different kinds of deals

Close relationship:

• between Harold Lee and Robin Yoagman

• no merger clause

Court found LEES AND Seagrams did not intend for contract to be completely integrated.

This agreement signed by both parties and so initialed by both parties in the margin opposite this paragraph constitutes a final written expression of all the terms of this agreement and is a complete and exclusive statement of those terms. (page 81, Burnham)

• This can also be called an integration clause.
• No such agreement in Seagram

Consider how long and detailed the document is, how specific it is. This will help determine if document is completely integrated.

Modern View of parole evidence

• should look at the document
• but also should consider all other relevant evidence
• can also look at parole evidence itself to see if parties intended it to be completely integrated
• In Tahoe National Bank case they considered evidence if reasonably susceptible to more than one interpretation. If so, they may admit and consider that evidence.

• read pages 1-3 again (in soft cover book – burgundy)
• DEFINITION: a scholarly work prepared by judges, practitioner, professors, which states in their opinion what the common law of a particular subject basically is or should be.
• These people study decisions across the country. Read all the decisions and say what the law seems to be (or if they don’t like it, say what it should be)
• Court may look at the restatement and say that it reflects a common approach and uses it as a basis for their opinion.
• Restatement is not law until sections may be adopted by the courts.
• Complete restatement is in law library
• Drafted in statute form, but is not a statute! It will help in ability to read statutes though.
• Look at sections 209, 210, 212-217 for info about parole evidence rule

1. Separation agreement problem.

1. overview

1. it is a contemporaneous agreement

• husband said he would give wife more if she needs it

1. the contract is a completely integrated document, so parole evidence would be inadmissible (unless it is then drafted into contract)
2. we need to get parole evidence into contract

1. redraft the contract to include the parole evidence

1. Husband may refuse to put it in contract
2. May agree to put something in writing

Consider Hypothetical Number 2 in Burnham on page 86.

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September 8, 1998

Review of exam question:

Was this a completely integrated agreement?

There were two separate contracts: one with contractor and one with architect. Merger clause was only in architect one, contractor incorporated merger clause by reference.

Length and complexity of contract would lead one to believe that everything was in the contract.

Probably this contract would be complete integration.

As to the first issue: was there a promise by the contractor to include an underwater camera system? (if want to, write a short answer to this and professor will look at it)

Sample answer:

Testimony of contractor is admissible. Was the document completely integrated? Then need to decide integration? Look at document itself. Merger clause, length and complexity. Modern view allows us to look at more facts and circumstances, admissibility of evidence, normally expect it in a contract. Then make a conclusion. Given all this, I think …..

BRING RESTATEMENT

Pg 214 b: agreements and negotiations prior to adoption of writing admissibility to establish integrated agreement if any is completely or partially integrated.

Page 86: how would you advise Barney Buyer? Need to include the oral statement in the written document.

Is the document partially integrated?

Probably not because the merger clause is in there, and the contract is extremely short. The document is concise and hard to miss the important stipulations.

Argument for partial integration: just a form from a stationary store. They may have not even known what the merger clause meant.

Cannot add to a partially integrated contract. If it was a partially integrated contract, then they could not have added to it. Must show it was neither partially, finally, or completely integrated (in order to allow outside parole evidence).

What is seller deceived buyer into believing it got 25 Mpg when in reality it only got 15mpg? See section 214d of restatement: if can show fraud would allow some remedy. Parole evidence rule does not bar introduction of evidence to show fraud.

Section 217: agreement cannot be integrated with respect to oral evidence.

Number of exceptions to parole evidence rule. 214, 217, Tahoe Bank Case

Distinguishing between a promise and a condition:

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September 10, 1998

Restitution: independent theory that you can get money back if someone has been unjustly enriched.

Voluntary relinquishment of a known right: can voluntarily relinquish right to sell

If there is a promise breach leads to remedy which is usually damages

If there is a condition, non-occurrence leads to discharge of obligations

Federal Crop Insurance case:

There was a condition for the farmer to not plow us fields until the insurance adjuster had time to inspect the crops.

Farmer should pay damages for the breach to the insurance company. EX: is it cost company $2000 to determine crop loss without the actual stalks, verses $500 to visually inspect the field. So damages to the insurance company to be paid by the farmer would be $1500.

The stipulation that the stalks would not be disked over was found to be a promise rather than a condition.

May 97 exam question discussion:

48. Athlete shall refrain from engaging in any conduct which might impair the value of Athlete's association with and endorsement of Free Kick products.

"shall" implies a promise

could be a condition because it is a stipulation that must be met in order for contract not to be terminated.

In cases of doubt the preference is to construe stipulation as a promise: means there is less possibility of huge forfeiture. Because consequence of breach of promise is merely damages. If breach of a condition there may be a huge repercussions, like the entire deal falling apart.

Because first stipulation was a promise, the next stipulation could be interpreted as a promise as well.

Condition precedent: obligation must be performed before contract can be carried out.

Condition subsequent:

Depending on how it is worded the burden of proof changes.

For Tuesday: new topics:

Modification, waver,

Read II, and o'neil case, and handicapped children case.

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September 15, 1998

Condition precedent to formation: condition that must be met before contract can be made. Parol evidence rule does not exclude this

Also comment B to section 227: what is meant by forfeiture as used in the restatement; refers to the denial of compensation as results in such a case

Section 229 of the restatement: could have this applied in the Merritt Hill Vineyards case?? May excuse unless the nonoccurrence of the condition was a material part of agreed exchange.

Need to determine if statements were promises or conditions when looking at a contract

See if you can construct an argument that condition was waived.

Promissory note is a form of contract

Margolin v. Franklin (p632)

Waiver – voluntary concession of a known right

Thursday – read may 97 contract again, O’neil case, Handicapped case, mineral land case, Lauder, Mattei

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September 17, 1998

Mattei v. Hopper

Mattei (buyer) promised to buy – conditioned on satisfactory leases (must come up with potential teneants/leases)

Hopper (seller) promised to sell

Hopper says she has right to revoke because the promise was merely an offer to sell.

Court says this is not what happened. Court says the condition was precedent to his performance. Not just an offer.

No parole evidence problem in this case

SEE BURNHAM 141 for info about condition precedent and condition subsequent. It is the wording that makes the difference.

Took leases in good faith – honesty, did person honestly act to evaluate whether the leases were satisfactory?

When there are contracts that a re conditioned on fancy, taste or judgement, then it must be required that the person acted in good faith. (was the person acting honestly??)

Can argue that dictum (like the part the court put in about the good faith standard) is not applicable in future cases. Say it was not applicable to the case then and should not be considered now.

Finish discussion of Waiver and modification

• look at the exam question involving Free Kick once more.

Compatibility

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September 22, 1998

Oneal case

Oneal promised to teach for a year

The school district promised to give him salary and benefits

In every contract there is a good faith promise – if Oneal were to show up on the first day and then take all his days of sick leave, he may be breaching promise of good faith

Handicapped children’s case

Mineral Park Lance Co. v. Howard

CH 10 – discharge by supervening impracticability

Assume abnormal events would not happen: then duty to perform is discharged

Supervening frustration – chapter 11 – purpose of contract can be frustrated. The court excused because it was substantially frustrated

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September 24, 1998

Simulated exam will be next Thursday instead. Prepare by memorizing the rules we have discussed in class so far.

Laudor case:

See section 265 for whether movie maker Ron Howard can be let out of contract with Laudor. Discharge by supervening frustration. Where after a contract is made, (1) a party’s principal purpose is substantially frustrated (2) without his fault be the occurrence of an event the non-occurrence of which was a basic assumption on which the contract was made, (3) his remaining duties to render performance are discharged, unless the language or the circumstances indicate the contrary. P278.

Could say Howard assumed the risk that Laudor might do something bad. He knew Laudor had this mental illness.

When writing exams make sure you are attentive to each part of the rule! Look at each element. Like in above rule there are 3 elements.

Burnham problems 1 and 2 page 133-134

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September 29, 1998

Review of Burnham problems

Frustration of purposes

Or argue that tennis player had reached an obligation to act in good faith

Look at morals clause in contract between NBC and sportscaster Marv Albert; try to rewrite it so that it is clearer.

§ 377 of the restatement says that Albert is entitled to partial payment because of the non-occurrence of a condition in the contract

review of Hochester v. De La Tour

repudiation occurs before the contract was supposed to begin. Law suit was filed before time for performance

if someone repudiates, then free from any performance you might otherwise be required to undertake.

Repudiation: Rejection or refusal. For example, repudiation of a contract is the refusal to go 66through with it, usually with a legal right to refuse.

Restitution 1. Giving something back; making good for something. 2. There are various rules for how much "giving back" is full restitution. For example, in contract law, restitution is usually the amount that puts the plaintiff back in the financial position he or she was in before the contract.

Review of Harris v. Time