DEFENSES TO BREACH OF CONTRACT
- Plaintiff's claim is that defendant promised to ______, but broke it by doing ______
- Plaintiff will ask for ______remedy, but defendant will try to limit it by arguing ______
CONSIDERATION AS A BASIS FOR ENFORCEMENT
- Why there is no valid promise or performance
- Plaintiff did not have good faith and reasonable belief in the possible validity of the claim - Cf. Fiege v. Boehm
- Illusory Promise: no express or implied commitment - Strong v. Sheffield; cf. Mattei v. Hopper; Wood v. Lucy, Lady Duff Gordon
- Why there is no valid bargained-for exchange
- Promise / performance already been received by D, not given in exchange for D's promise - Feinberg v. Pfeiffer
- Promise / performance not given until after D's promise = not given in exchange - Feinberg, Strong v. Sheffield
- D's promise was a conditional promise to make a gift - Kirksey v. Kirksey
- Sham
- INVALID arguments for why there is no consideration
- Did not benefit D or impose a detriment on P - Hamer v. Sidway
- It was less valuable than D's promise - Cf. Fiege v. Boehm
RELIANCE AS A BASIS FOR ENFORCEMENT
- Why elements of reliance are not proven
- Would have taken action anyway - Cf. Feinberg v. Pfeiffer
- Not necessary to prevent injustice - Cf. Feinberg v. Pfeiffer; Cohen v. Cowles Media
MORAL OBLIGATION AS A BASIS FOR ENFORCEMENT
- Why promise is not enforceable on the basis of moral obligation
- Promise is not one of the special kinds or promises:
- Discharged by statute of limitations;
- Discharged by bankruptcy proceedings; or
- Voidable because of infancy
- Won’t enforce promise for recognition of material benefit P conferred on D - Dementas; cf. Webb v. McGowin
RESTITUTION AS A SUBSTITUTE FOR ENFORCEMENT
- No unjust enrichment at P's expense
- Volunteer, manifesting no expectation of compensation
- Officious intermeddler
- Other remedies - Callano v. Oakwood Park Homes
CONTRACT FORMATION
- No assent
- Actually knew or a reasonable person would have known D not assenting to be bound - Cf. Lucy v. Zehmer
- No offer or acceptance
- There was no offer - Owen v. Tunison; Harvey v. Facey; Fairmount Glass; Lefkowitz v. Great Minn. Surplus Store
- Offer lapses before the attempted acceptance
- Revoked by offeror before the attempted acceptance, no valid option contract - Dickinson v. Dodd
- Expressly rejected before the attempted acceptance
- Implicitly rejected because of a counteroffer - Columbus Rolling Mill
- Terminated before acceptance because offeror died - Earle v. Angell
- Offer invited acceptance by the rendering of complete performance, and the offeree did not completely perform
- Invited acceptance by a promise to perform, and the offeree did not make such a promise either with words or implicitly with conduct - White v. Corlies & Tift; Ever-Tite Roofing v. Green
- Invited acceptance by promise to perform, offeree did not make promise in manner invited by offer - Allied Steel v. Ford Motor Co.
- Offeror could not insist that silence would be acceptance - Cf. Hobbs v. Massasoit Whip Co.
- Offer required notice of acceptance and offeree did not provide notice - White v. Corlies & Tift; Ever-Tite Roofing v. Green; International Filter v. Conroe Gin; cf. Carlill v. Carbolic Smoke Ball
- Too indefinite to enforce
- Terms of contract are too indefinite to determine what constitutes a breach, or what an appropriate remedy is - Varney v. Ditmars; Toys v. Burlington
STATUTES OF FRAUDS
- Why promise is unenforceable
- Falls within the scope of a statute of frauds; requisiteness of writing and signing have not been met, because:
- There was no writing;
- Writing does not state the essential terms; or
- Defendant did not sign the writing
- Plaintiff's responses – Need A + (B or C) OR A + B + C – Richards v. Richards
- Promise actually does not fall within scope of any statute of frauds, because, e.g.:
- Promise does not meet definition of suretyship promise - Langman v. UVA Alumni Association
- Promise could technically be completely performed within one year - Klewin
- D is equitably estopped from denying the existence signed writing because he asserted that writing had been made, and P relied on D's assertion
- Pursuant to the "part performance" exception for land contracts, D may not assert the statute of frauds as a defense because D promised to convey land, and P substantially relied on the promise by:
- Payment of part of purchase price
- Taking possession of property
- Making improvements to property
- Defendant may not assert the statute of frauds as a defense because P relied on D's promise, and injustice can be avoided only by enforcement of the promise - Monarco v. LoGreco [but not all courts recognize this defense]
POLICING THE BARGAIN
Why promise is voidable/void
- I was an infant when I made it - Kiefer v. Fred Howe Motors
- I was suffering from a mental infirmity and as a result could not:
- Understand the nature and consequence of the transaction - cf. Cundick v. Broadbent
- Act in a reasonable manner with respect to the transaction, and P had notice of this condition - Ortelere
- It was induced by an improper threat that left me with no reasonable alternative
- Unilaterally modified contract, violation of pre-existing duty did not provide new consideration - Alaska Packers
- Old contract was not canceled before forming a new one, so pre-existing duty rule still applies - Scwartzreich v. Bauman-Basch
- Modification was not fair and reasonable in light of changed circumstances - Watkins v. Carrig
- It was induced by
- A fraudulent or material misrepresentation, and I justifiable relied on it
- An action intended to prevent me from learning a fact
- A half-truth - Kannavos v. Annino
- A non-disclosure of facts, I expected full disclosure based on our confidential relationship
- A mutual mistake as to a basic assumption that had a material effect, and I did not bear the risk of mistake Sherwood v. Walker; cf. Wood v. Boynton; Stees v. Leonard
- My unilateral mistake, and enforcement would make contract unconscionable
- Promise is VOID because it violates a strong public policy, e.g.
- Middleman should not make excessive profits - Black v. Bush Industries
- Consumer protection - O'Callaghan v. Walter & Beckwith; Henningsen
ADHESION CONTRACTS
- Pattern of argumentation
- P's claim
- D breached a contact or committed a tort
- D's defense
- I am not liable, or my liability is limited, because of an exculpation clause in our form contract
- P's replies
- No adequate notice that the form contained contractual terms - Klar v. H&M Parcel
- Exculpation clause,
- When strictly construed, does not apply to this situation - Galligan v. Arovitch
- Unenforceable because it violates a strong public policy against X - Henningsen
- Unenforceable on grounds of unconscionability because of X
REMEDIES
- Why plaintiff is not entitled to liquidated damages
- Liquidated damage is unreasonably large in relation to both actual and anticipated damages and therefore cannot be enforced, as it is a penalty - Dave Gustafson v. State
- Why plaintiff is not entitled to specific performance
- Damages would be an adequate remedy
- Bargain was unfair at time it was made - McKinnon, Tuckwiller
- Reduce Expectation Damages Because:
- P could have avoided some of loss - Luten Bridge
- An incomplete or defective performance
- For loss in value: cost to complete or remedy is grossly disproportionate to the probable loss in value to P (Jacob & Youngs v. Kent, Peevyhouse v. Garland Coal, cf. Groves v. John Wunder)
- Loss in value was not foreseeable at the time contract was made because
- Damages did not arise in the ordinary course of events
- No notice of special circumstances giving rise to the damages - Hadley v. Baxendale
- P cannot prove the loss in value or other loss with reasonable certainty - Collatz, cf. Fera v. Village Plaza
- Otherwise, plaintiff is only entitled to reliance/nominal damages, if anything