there is a contract because consideration happened BUT it should be set aside later because one party can take unfair advantage of another.
Undue influence (relationships that create imbalance)if contract is entered into as a result of one party taking undue advantage of the other
court will set contract aside
Adequacy of Consideration
"Severe inadequacy of consideration may be relevant to determining if there’s unconscionability but it doesn’t preclude a finding of sufficient consideration.
If unconscionability is found
the contract will be set aside."
The Peppercorn Theory:
"in a bargain in which something of value is exchanged for something of trivial value
"Nature of Consideration:
"Consideration must be provided by both parties
Something of positive or negative value
Concurrent exchange of consideration is insufficient"
"1-General-the mutual exchange of value. Promises can only be enforced if they form part of a bargain (a mutual exchange of value) Mutual exchange = reciprocal undertakings
Counter Offer definition
"occurs when offeree responds to offer by indicating a willingness to enter agreement
Modes of Termination
"Counter offer by offeree
Rejection of offer by offeree
Revocation of offer by offeror
Lapse of time open to accept offer
Occurrence of contemplated terminating condition
"Contracts formed over the internet:
"no negotiating. You can only accept the pre-listed terms. However
Postal Rule does not apply where
"1-the offeror says that they have to receive the offer. – Holwell Securities-Requires actual notice.
2-Also doesn’t apply where it would create an absurd result. E.g. ongoing negotiations and at one point a party uses the mail once to communicate. This is absurd when taken in context because there was an established expectation of time-frames and communications."
Postal rule only applies to
"acceptance: does not apply to anything else including rejection. Therefore
Communication of Acceptance GENERAL RULE:
"contract is formed upon offeror receiving acceptance from offeree. Until then
Communication of Acceptance RULE:
no contract is created before the communication of acceptance.
ACCEPTANCE BY SILENCE-
"why can’t silence constitute acceptance?
“The uncle had no right to impose upon the nephew a sale of his horse unless [the nephew] chose to comply with the conditions of writing to repudiate the offer.” (Felthouse v Bindley)
Recall: offeree must communicate acceptance to offeror (or someone authorized to accept acceptance
such as agent).
Follows: silence alone cannot constitute acceptance (Felthouse v Bindley).
But: silence may constitute acquiescence. When? (St. John’s Tub Boat v Irving Refinery)"
Different forms of acceptance:
"1. Bilateral K: accepted thru promise
2. Unilateral K: accepted thru performance (CarbolicSmokeBall; Williams v Carwardine)"
Means of revolving the Battle of the Forms:
1- First shot doctrine
2- Last shot doctrine
3- Unjust enrichment
4- Mirror image rule
5-Reconciling the shots (Denning in Butler)-consistent with reasonable expectations of parties and continuing business relations"
The Counter Offer-Characteristics of Acceptance
"Unqualified commitment to terms of offer
Must be meeting of the minds
Must be in response to offer"
expression of willingness by offeree to enter contract on terms stated in offer.
communication by offeror indicating a willingness to enter contract on certain terms
Offer and Invitation to Treat Distinction:
an invitation to treat is different than an actual offer because an actual offer communicates a willingness to be bound by the next communication of the offeree.
"Courts try to fulfill the expectations of the parties by interpreting the terms
"detrimental reliance (are one or more of the parties detrimentally relying on the contract?) we want to protect this
Bad faith of one of the parties (where one party claims that they don’t have a contract for other reasons