What is the Common Law Mirror Image Rule regarding acceptances?

Under the common law, an acceptance must be a mirror image of the offer. Any response that proposes different or additional terms, or conditions acceptance on new terms, operates as a rejection and counteroffer, terminating the original power of acceptance. (Compare to UCC § 2-207 which abolishes the mirror image rule for sales of goods).

What constitutes a valid Offer under contract law, and how do essential terms differ between UCC and Common Law?

An offer is a manifestation of willingness to enter into a bargain, made to justify another person in understanding that assent invites acceptance (Restatement § 24). Essential terms: • Common Law: Requires essential terms to be reasonably definite (parties, subject matter, price, and quantity). • UCC Article 2: Requires only quantity (UCC § 2-204); price and other terms can be supplied by UCC gap fillers if parties intended to contract.

What are the requirements for an enforceable Liquidated Damages clause?

Enforceable if: (1) Anticipated damages were difficult to ascertain or estimate at the time of contract execution; and (2) The stipulated amount was a reasonable forecast of just compensation for the anticipated or actual harm. If the amount is unreasonable or intended to punish/coerce performance, it is void as an unenforceable penalty.

How do Express Conditions differ from Constructive Conditions (Implied Conditions)?

• Express Conditions (e.g., 'provided that', 'on condition that'): Must be strictly and literally complied with. Failure of condition completely excuses the other party's duty of performance, but is not a breach unless party promised condition would occur. • Constructive Conditions of Exchange: Created by law. Governed by Substantial Performance doctrine; immaterial failure does not excuse performance, but allows offset for minor damages.

What is the Doctrine of Mitigation of Damages in contract law?

The non-breaching party cannot recover damages that could have been avoided by reasonable effort without undue risk, burden, or humiliation (Restatement § 350). In employment contracts, employee must use reasonable diligence to secure substantially similar or comparable employment; failure reduces recovery by amount employee could have earned.

What are the requirements for the Implied Warranty of Fitness for a Particular Purpose (UCC § 2-315)?

Requirements: (1) Seller (need NOT be a merchant) knows or has reason to know the buyer has a particular, non-ordinary purpose for the goods; (2) Seller knows buyer is relying on seller's skill or judgment to select suitable goods; and (3) Buyer actually relies on seller's skill/judgment. To disclaim: Must be by a conspicuous writing (mentioning 'merchantability' is not required; 'as is' suffices).

How does Acceptance differ between Bilateral and Unilateral contracts?

• Bilateral Contract: An offer seeking a return promise; accepted by either a return promise or commencement of performance. • Unilateral Contract: An offer expressly requesting acceptance ONLY by full performance of the requested act. Under modern law (Restatement § 45), once offeree begins requested performance, an option contract is formed preventing offeror from revoking, but offeree is not bound to finish.

When does a Revocation of an offer become effective, and when is an offer irrevocable?

Revocation is effective ONLY upon receipt by the offeree (or when offeree learns from a reliable third party of inconsistent conduct). Offers are generally revocable at will before acceptance, EXCEPT: 1. Option Contracts supported by consideration; 2. UCC Firm Offers (§ 2-205); 3. Detrimental reliance / Promissory Estoppel (Restatement § 87(2)); 4. Part performance of a unilateral contract (Restatement § 45 creates an option contract).

What is the Parol Evidence Rule (PER), and how does it distinguish Complete vs. Partial Integrations?

The PER prohibits introduction of extrinsic evidence of prior or contemporaneous oral/written agreements that contradict the terms of an integrated written contract. • Completely Integrated Agreement: Intended as complete and exclusive embodiment of terms (e.g., merger clause). Cannot be contradicted OR supplemented. • Partially Integrated Agreement: Final expression as to terms contained, but not complete. Cannot be contradicted, but CAN be supplemented by consistent additional terms.

What are the legal standards for Impossibility, Impracticability, and Frustration of Purpose?

• Impossibility: Objective impossibility (no one could perform); e.g., destruction of subject matter, death of essential service provider. • Impracticability (UCC § 2-615): Extreme, unreasonable, unanticipated difficulty or expense caused by an unforeseen supervening event whose non-occurrence was a basic assumption. • Frustration of Purpose: Supervening event destroys the entire mutually understood purpose of contract, rendering performance virtually worthless (Krell v. Henry).

Under what circumstances is an express condition excused?

1. Waiver: Party benefited by condition voluntarily relinquishes it (can be retracted before detrimental reliance if non-material); 2. Wrongful Prevention / Bad Faith: Party benefited hinders or prevents occurrence of condition (breach of implied duty of good faith); 3. Estoppel: Detrimental reliance on a statement that condition will not be enforced; 4. Impossibility / Impracticability: Extreme disproportionate forfeiture.

What are the statutory requirements for a UCC Firm Offer under § 2-205?

An offer to buy or sell goods is irrevocable WITHOUT consideration if: (1) Made by a merchant; (2) Gives signed written assurance that it will be held open; (3) Irrevocable period is for the time stated, or if no time is stated, a reasonable time NOT to exceed 3 months (any period beyond 3 months requires consideration to remain irrevocable); and (4) If on a form supplied by offeree, signed separately by merchant offeror.

What is the Perfect Tender Rule under UCC Article 2, and what are its exceptions?

General Rule (UCC § 2-601): Buyer may reject goods if goods or tender fail in any respect to conform to contract. Exceptions: 1. Seller's Right to Cure (§ 2-508): Within contract time, or after if seller had reasonable grounds to believe tender acceptable; 2. Installment Contracts (§ 2-612): Buyer can reject an installment ONLY if non-conformity substantially impairs that installment and cannot be cured; total contract breach only if substantial impairment of whole; 3. Buyer Acceptance: Once buyer accepts (or fails to inspect within reasonable time), buyer cannot reject (can only revoke acceptance for substantial impairment).

What are the requirements for the Implied Warranty of Merchantability (UCC § 2-314)?

Requirements: (1) Seller must be a Merchant with respect to goods of that kind; (2) Automatically implied into the contract by operation of law; (3) Goods must be 'merchantable' (fit for ordinary purposes for which such goods are used, adequately packaged, and conform to affirmations on label). To disclaim: Must mention 'merchantability' and, if in writing, be conspicuous (or use 'as is' / 'with all faults' under § 2-316).

What categories of contracts fall within the Statute of Frauds (MY LEGS)?

Contracts unenforceable unless evidenced by a signed writing: • M: Marriage (contracts made in consideration of marriage / prenuptials); • Y: Year (contracts incapable of being fully performed within one year from making); • L: Land (contracts transferring an interest in real property); • E: Executor/administrator (promising to pay estate debt from personal funds); • G: Goods priced at $500 or more (UCC § 2-201); • S: Suretyship (promising to answer for debt/duty of another, unless main purpose is promisor's self-interest).

What are the common law and UCC exceptions that overcome the Statute of Frauds without a writing?

• Land: Part performance (requires at least 2 of 3: payment, possession, substantial improvements); • UCC Goods: (1) Specially manufactured goods not suitable for sale to others once manufacture has substantially begun (§ 2-201(3)(a)); (2) Judicial admission under oath (§ 2-201(3)(b)); (3) Part performance / payment made and accepted or goods received and accepted (§ 2-201(3)(c)); • One-Year Contracts: Full performance by one party satisfies the statute.

How does UCC Article 2 differ from the Common Law regarding scope and applicable law?

• UCC Article 2 governs transactions in goods (all things movable at the time of identification to the contract, UCC § 2-105). • Common Law governs real estate, services, employment, and intangible rights. • Predominant Purpose Test: For hybrid contracts involving both goods and services, courts determine whether the predominant factor/purpose is the sale of goods (UCC applies to entire contract) or provision of services (Common Law applies to entire contract).

Are Advertisements considered contractual offers? What is the exception?

General Rule: Advertisements, catalogs, price quotes, and circulars are treated as invitations to deal / preliminary negotiations, not offers, because they lack quantity and specific offerees. Exception: An advertisement is a valid offer if it is definite, specific, and leaves nothing open for negotiation, stating clear quantity and who can accept (e.g., '1 black fur coat worth $100 for $1, first come first served at 9 AM' — Lefkowitz).

What is the Pre-Existing Duty Rule at common law, and how does UCC § 2-209 differ for contract modifications?

• Common Law: A promise to perform an existing legal duty is not valid consideration for a contract modification; modifications require fresh consideration (unless unforeseen supervening difficulties or change in duties). • UCC § 2-209: Abolishes the pre-existing duty rule for sales of goods. A contract modification needs NO new consideration to be binding, provided it is made in good faith and for a legitimate commercial reason.

What is the Mailbox Rule and what are its critical exceptions?

General Rule: Acceptance of an offer by mail or authorized dispatch is effective upon proper dispatch (deposit in mailbox), creating a binding contract at that moment. Exceptions: (1) Offer expressly stipulates acceptance effective only upon receipt; (2) Option contracts (acceptance effective upon receipt); (3) Rejection sent first: If offeree sends rejection then acceptance, whichever arrives first controls; (4) Acceptance sent first: Contract forms on dispatch, but if rejection arrives first and offeror detrimentally relies, offeree is estopped.

What constitutes legally sufficient Consideration for a contract?

Consideration requires a Bargained-for Exchange of Legal Detriment: 1. Bargained-for: The promise induces the detriment, and the detriment induces the promise; 2. Legal Detriment: Promising to do something one is not legally obligated to do, or refraining from doing something one has a legal right to do (Hamer v. Sidway). Past consideration, moral obligation, illusory promises, and gifts do NOT constitute consideration.

What is the procedure for Demanding Adequate Assurances under UCC § 2-609?

When reasonable grounds for insecurity arise regarding party's performance, the insecure party may demand in writing adequate assurance of due performance and may, if commercially reasonable, suspend performance until received. Failure to provide adequate assurance within a reasonable time (not exceeding 30 days) constitutes an Anticipatory Repudiation of the contract.

What are the writing requirements under UCC § 2-201, and what is the Merchant's Confirmatory Memo Exception?

UCC writing requirement: Only needs: (1) writing sufficient to indicate a contract was made, (2) signed by party against whom enforcement is sought, and (3) a quantity term. • Merchant's Confirmatory Memo Exception (§ 2-201(2)): Between merchants, if one sends a written confirmation within a reasonable time sufficient against sender, and recipient has reason to know its contents, it satisfies the Statute of Frauds against recipient UNLESS recipient sends written objection within 10 days of receipt.

What is the difference between Procedural Unconscionability and Substantive Unconscionability?

• Procedural Unconscionability: Unfairness in the bargaining process resulting in absence of meaningful choice (e.g., contracts of adhesion, fine print, hidden terms, unequal bargaining power). • Substantive Unconscionability: Unfairness in the substantive terms of the contract that are overly harsh, one-sided, oppressive, or shock the conscience. Most courts require a showing of both to invalidate or reform a contract under UCC § 2-302 / Restatement § 208.

How do courts handle 'Different' (conflicting) terms under UCC § 2-207?

Majority Rule (The Knockout Rule): Conflicting terms in the offer and acceptance cancel each other out (both drop out), and the resulting gap is filled by applicable UCC Article 2 statutory gap-fillers (e.g., UCC implied warranties, reasonable delivery time, reasonable price under § 2-305). Minority Rule: Different terms are treated the same as additional terms under § 2-207(2).

What are the elements of Promissory Estoppel (Restatement Second of Contracts § 90)?

1. Promisor makes a clear and unambiguous promise; 2. Promisor should reasonably expect the promise to induce action or forbearance by promisee; 3. Promisee actually and reasonably relies on the promise to their detriment; 4. Injustice can be avoided only by enforcement of the promise. Remedy is often limited to reliance damages (reimbursement of costs) rather than full expectation damages.

What are the recognized exceptions where the Parol Evidence Rule does not apply?

Extrinsic evidence is admissible to: (1) Defend against formation (fraud, duress, mistake, illegality, lack of consideration); (2) Prove a condition precedent to the contract's effectiveness; (3) Interpret ambiguous or unclear contract terms; (4) Show subsequent oral modifications made after execution of the agreement; (5) Prove trade usage, course of dealing, or course of performance under UCC § 2-202.

What is the rule of Hadley v. Baxendale regarding Consequential Damages?

Consequential damages (special damages resulting from plaintiff's particular circumstances, such as lost commercial profits) are recoverable ONLY if they were reasonably foreseeable to the breaching party at the time contract was formed. Damages are foreseeable if: (1) they arise naturally in ordinary course of things, or (2) promisor had actual notice of special circumstances.

How are Expectation Damages calculated in contract breach?

Expectation damages place the non-breaching party in the position they would have occupied had the contract been fully performed ('benefit of the bargain'). Formula: Expectation Damages = (Loss of Value of Breaching Party's Promised Performance) + (Incidental Damages) + (Consequential Damages) - (Expenses Saved / Cost Avoided by Non-Breaching Party).

What is the difference between Mutual Mistake and Unilateral Mistake as defenses to contract formation?

• Mutual Mistake: Both parties mistaken as to a basic assumption of fact having a material effect on agreed exchange. Contract is voidable by adversely affected party UNLESS they bore the risk of mistake (Restatement § 152; Sherwood v. Walker). • Unilateral Mistake: Only one party mistaken. Not voidable UNLESS: (a) non-mistaken party knew or had reason to know of the mistake (e.g., obvious mathematical bid error), or (b) the mistake makes enforcement unconscionable.

What is Anticipatory Repudiation, and what options does the non-repudiating party have?

An unambiguous statement or conduct indicating that a party cannot or will not perform their material contractual obligations before performance is due. Non-repudiating party may: (1) Treat repudiation as total breach and sue immediately for damages; (2) Suspend own performance and wait until performance date; (3) Treat contract as rescinded and discharge duties; or (4) Urge performance. Repudiating party can retract before non-repudiator sues or materially relies.

Under UCC § 2-207 (Battle of the Forms), how does an acceptance with additional terms operate between Non-Merchants vs. between Merchants?

A definite and seasonal expression of acceptance operates as an acceptance even though it states terms additional to or different from those offered, unless acceptance is expressly made conditional on assent to the additional terms. • If at least one party is a Non-Merchant: Additional terms are treated as mere proposals for addition and do NOT become part of contract unless offeror expressly agrees. • Between Merchants: Additional terms automatically become part of contract UNLESS: (a) Offer expressly limits acceptance to offer terms; (b) Terms materially alter the contract; or (c) Notification of objection is given within a reasonable time.

Bar Exam MBE: Contracts & UCC Article 2 — Offer, Acceptance, Consideration, Statute of Frauds & Remedies

High-yield MBE mastery of common law contracts and UCC Article 2 sales, contract formation, defenses, parol evidence rule, warranties, performance, conditions, and breach remedies.

Level: basic
Languages: en → en
Cards: 32
Markdown: Bar Exam MBE: Contracts & UCC Article 2 — Offer, Acceptance, Consideration, Statute of Frauds & Remedies (.md)

Flashcards (32)

#	Front (Term / Question)	Back (Definition / Answer)
1	What is the Common Law Mirror Image Rule regarding acceptances?	Under the common law, an acceptance must be a mirror image of the offer. Any response that proposes different or additional terms, or conditions acceptance on new terms, operates as a rejection and counteroffer, terminating the original power of acceptance. (Compare to UCC § 2-207 which abolishes the mirror image rule for sales of goods).
2	What constitutes a valid Offer under contract law, and how do essential terms differ between UCC and Common Law?	An offer is a manifestation of willingness to enter into a bargain, made to justify another person in understanding that assent invites acceptance (Restatement § 24). Essential terms: • Common Law: Requires essential terms to be reasonably definite (parties, subject matter, price, and quantity). • UCC Article 2: Requires only quantity (UCC § 2-204); price and other terms can be supplied by UCC gap fillers if parties intended to contract.
3	What are the requirements for an enforceable Liquidated Damages clause?	Enforceable if: (1) Anticipated damages were difficult to ascertain or estimate at the time of contract execution; and (2) The stipulated amount was a reasonable forecast of just compensation for the anticipated or actual harm. If the amount is unreasonable or intended to punish/coerce performance, it is void as an unenforceable penalty.
4	How do Express Conditions differ from Constructive Conditions (Implied Conditions)?	• Express Conditions (e.g., 'provided that', 'on condition that'): Must be strictly and literally complied with. Failure of condition completely excuses the other party's duty of performance, but is not a breach unless party promised condition would occur. • Constructive Conditions of Exchange: Created by law. Governed by Substantial Performance doctrine; immaterial failure does not excuse performance, but allows offset for minor damages.
5	What is the Doctrine of Mitigation of Damages in contract law?	The non-breaching party cannot recover damages that could have been avoided by reasonable effort without undue risk, burden, or humiliation (Restatement § 350). In employment contracts, employee must use reasonable diligence to secure substantially similar or comparable employment; failure reduces recovery by amount employee could have earned.
6	What are the requirements for the Implied Warranty of Fitness for a Particular Purpose (UCC § 2-315)?	Requirements: (1) Seller (need NOT be a merchant) knows or has reason to know the buyer has a particular, non-ordinary purpose for the goods; (2) Seller knows buyer is relying on seller's skill or judgment to select suitable goods; and (3) Buyer actually relies on seller's skill/judgment. To disclaim: Must be by a conspicuous writing (mentioning 'merchantability' is not required; 'as is' suffices).
7	How does Acceptance differ between Bilateral and Unilateral contracts?	• Bilateral Contract: An offer seeking a return promise; accepted by either a return promise or commencement of performance. • Unilateral Contract: An offer expressly requesting acceptance ONLY by full performance of the requested act. Under modern law (Restatement § 45), once offeree begins requested performance, an option contract is formed preventing offeror from revoking, but offeree is not bound to finish.
8	When does a Revocation of an offer become effective, and when is an offer irrevocable?	Revocation is effective ONLY upon receipt by the offeree (or when offeree learns from a reliable third party of inconsistent conduct). Offers are generally revocable at will before acceptance, EXCEPT: 1. Option Contracts supported by consideration; 2. UCC Firm Offers (§ 2-205); 3. Detrimental reliance / Promissory Estoppel (Restatement § 87(2)); 4. Part performance of a unilateral contract (Restatement § 45 creates an option contract).
9	What is the Parol Evidence Rule (PER), and how does it distinguish Complete vs. Partial Integrations?	The PER prohibits introduction of extrinsic evidence of prior or contemporaneous oral/written agreements that contradict the terms of an integrated written contract. • Completely Integrated Agreement: Intended as complete and exclusive embodiment of terms (e.g., merger clause). Cannot be contradicted OR supplemented. • Partially Integrated Agreement: Final expression as to terms contained, but not complete. Cannot be contradicted, but CAN be supplemented by consistent additional terms.
10	What are the legal standards for Impossibility, Impracticability, and Frustration of Purpose?	• Impossibility: Objective impossibility (no one could perform); e.g., destruction of subject matter, death of essential service provider. • Impracticability (UCC § 2-615): Extreme, unreasonable, unanticipated difficulty or expense caused by an unforeseen supervening event whose non-occurrence was a basic assumption. • Frustration of Purpose: Supervening event destroys the entire mutually understood purpose of contract, rendering performance virtually worthless (Krell v. Henry).
11	Under what circumstances is an express condition excused?	1. Waiver: Party benefited by condition voluntarily relinquishes it (can be retracted before detrimental reliance if non-material); 2. Wrongful Prevention / Bad Faith: Party benefited hinders or prevents occurrence of condition (breach of implied duty of good faith); 3. Estoppel: Detrimental reliance on a statement that condition will not be enforced; 4. Impossibility / Impracticability: Extreme disproportionate forfeiture.
12	What are the statutory requirements for a UCC Firm Offer under § 2-205?	An offer to buy or sell goods is irrevocable WITHOUT consideration if: (1) Made by a merchant; (2) Gives signed written assurance that it will be held open; (3) Irrevocable period is for the time stated, or if no time is stated, a reasonable time NOT to exceed 3 months (any period beyond 3 months requires consideration to remain irrevocable); and (4) If on a form supplied by offeree, signed separately by merchant offeror.
13	What is the Perfect Tender Rule under UCC Article 2, and what are its exceptions?	General Rule (UCC § 2-601): Buyer may reject goods if goods or tender fail in any respect to conform to contract. Exceptions: 1. Seller's Right to Cure (§ 2-508): Within contract time, or after if seller had reasonable grounds to believe tender acceptable; 2. Installment Contracts (§ 2-612): Buyer can reject an installment ONLY if non-conformity substantially impairs that installment and cannot be cured; total contract breach only if substantial impairment of whole; 3. Buyer Acceptance: Once buyer accepts (or fails to inspect within reasonable time), buyer cannot reject (can only revoke acceptance for substantial impairment).
14	What are the requirements for the Implied Warranty of Merchantability (UCC § 2-314)?	Requirements: (1) Seller must be a Merchant with respect to goods of that kind; (2) Automatically implied into the contract by operation of law; (3) Goods must be 'merchantable' (fit for ordinary purposes for which such goods are used, adequately packaged, and conform to affirmations on label). To disclaim: Must mention 'merchantability' and, if in writing, be conspicuous (or use 'as is' / 'with all faults' under § 2-316).
15	What categories of contracts fall within the Statute of Frauds (MY LEGS)?	Contracts unenforceable unless evidenced by a signed writing: • M: Marriage (contracts made in consideration of marriage / prenuptials); • Y: Year (contracts incapable of being fully performed within one year from making); • L: Land (contracts transferring an interest in real property); • E: Executor/administrator (promising to pay estate debt from personal funds); • G: Goods priced at $500 or more (UCC § 2-201); • S: Suretyship (promising to answer for debt/duty of another, unless main purpose is promisor's self-interest).
16	What are the common law and UCC exceptions that overcome the Statute of Frauds without a writing?	• Land: Part performance (requires at least 2 of 3: payment, possession, substantial improvements); • UCC Goods: (1) Specially manufactured goods not suitable for sale to others once manufacture has substantially begun (§ 2-201(3)(a)); (2) Judicial admission under oath (§ 2-201(3)(b)); (3) Part performance / payment made and accepted or goods received and accepted (§ 2-201(3)(c)); • One-Year Contracts: Full performance by one party satisfies the statute.
17	How does UCC Article 2 differ from the Common Law regarding scope and applicable law?	• UCC Article 2 governs transactions in goods (all things movable at the time of identification to the contract, UCC § 2-105). • Common Law governs real estate, services, employment, and intangible rights. • Predominant Purpose Test: For hybrid contracts involving both goods and services, courts determine whether the predominant factor/purpose is the sale of goods (UCC applies to entire contract) or provision of services (Common Law applies to entire contract).
18	Are Advertisements considered contractual offers? What is the exception?	General Rule: Advertisements, catalogs, price quotes, and circulars are treated as invitations to deal / preliminary negotiations, not offers, because they lack quantity and specific offerees. Exception: An advertisement is a valid offer if it is definite, specific, and leaves nothing open for negotiation, stating clear quantity and who can accept (e.g., '1 black fur coat worth $100 for $1, first come first served at 9 AM' — Lefkowitz).
19	What is the Pre-Existing Duty Rule at common law, and how does UCC § 2-209 differ for contract modifications?	• Common Law: A promise to perform an existing legal duty is not valid consideration for a contract modification; modifications require fresh consideration (unless unforeseen supervening difficulties or change in duties). • UCC § 2-209: Abolishes the pre-existing duty rule for sales of goods. A contract modification needs NO new consideration to be binding, provided it is made in good faith and for a legitimate commercial reason.
20	What is the Mailbox Rule and what are its critical exceptions?	General Rule: Acceptance of an offer by mail or authorized dispatch is effective upon proper dispatch (deposit in mailbox), creating a binding contract at that moment. Exceptions: (1) Offer expressly stipulates acceptance effective only upon receipt; (2) Option contracts (acceptance effective upon receipt); (3) Rejection sent first: If offeree sends rejection then acceptance, whichever arrives first controls; (4) Acceptance sent first: Contract forms on dispatch, but if rejection arrives first and offeror detrimentally relies, offeree is estopped.
21	What constitutes legally sufficient Consideration for a contract?	Consideration requires a Bargained-for Exchange of Legal Detriment: 1. Bargained-for: The promise induces the detriment, and the detriment induces the promise; 2. Legal Detriment: Promising to do something one is not legally obligated to do, or refraining from doing something one has a legal right to do (Hamer v. Sidway). Past consideration, moral obligation, illusory promises, and gifts do NOT constitute consideration.
22	What is the procedure for Demanding Adequate Assurances under UCC § 2-609?	When reasonable grounds for insecurity arise regarding party's performance, the insecure party may demand in writing adequate assurance of due performance and may, if commercially reasonable, suspend performance until received. Failure to provide adequate assurance within a reasonable time (not exceeding 30 days) constitutes an Anticipatory Repudiation of the contract.
23	What are the writing requirements under UCC § 2-201, and what is the Merchant's Confirmatory Memo Exception?	UCC writing requirement: Only needs: (1) writing sufficient to indicate a contract was made, (2) signed by party against whom enforcement is sought, and (3) a quantity term. • Merchant's Confirmatory Memo Exception (§ 2-201(2)): Between merchants, if one sends a written confirmation within a reasonable time sufficient against sender, and recipient has reason to know its contents, it satisfies the Statute of Frauds against recipient UNLESS recipient sends written objection within 10 days of receipt.
24	What is the difference between Procedural Unconscionability and Substantive Unconscionability?	• Procedural Unconscionability: Unfairness in the bargaining process resulting in absence of meaningful choice (e.g., contracts of adhesion, fine print, hidden terms, unequal bargaining power). • Substantive Unconscionability: Unfairness in the substantive terms of the contract that are overly harsh, one-sided, oppressive, or shock the conscience. Most courts require a showing of both to invalidate or reform a contract under UCC § 2-302 / Restatement § 208.
25	How do courts handle 'Different' (conflicting) terms under UCC § 2-207?	Majority Rule (The Knockout Rule): Conflicting terms in the offer and acceptance cancel each other out (both drop out), and the resulting gap is filled by applicable UCC Article 2 statutory gap-fillers (e.g., UCC implied warranties, reasonable delivery time, reasonable price under § 2-305). Minority Rule: Different terms are treated the same as additional terms under § 2-207(2).
26	What are the elements of Promissory Estoppel (Restatement Second of Contracts § 90)?	1. Promisor makes a clear and unambiguous promise; 2. Promisor should reasonably expect the promise to induce action or forbearance by promisee; 3. Promisee actually and reasonably relies on the promise to their detriment; 4. Injustice can be avoided only by enforcement of the promise. Remedy is often limited to reliance damages (reimbursement of costs) rather than full expectation damages.
27	What are the recognized exceptions where the Parol Evidence Rule does not apply?	Extrinsic evidence is admissible to: (1) Defend against formation (fraud, duress, mistake, illegality, lack of consideration); (2) Prove a condition precedent to the contract's effectiveness; (3) Interpret ambiguous or unclear contract terms; (4) Show subsequent oral modifications made after execution of the agreement; (5) Prove trade usage, course of dealing, or course of performance under UCC § 2-202.
28	What is the rule of Hadley v. Baxendale regarding Consequential Damages?	Consequential damages (special damages resulting from plaintiff's particular circumstances, such as lost commercial profits) are recoverable ONLY if they were reasonably foreseeable to the breaching party at the time contract was formed. Damages are foreseeable if: (1) they arise naturally in ordinary course of things, or (2) promisor had actual notice of special circumstances.
29	How are Expectation Damages calculated in contract breach?	Expectation damages place the non-breaching party in the position they would have occupied had the contract been fully performed ('benefit of the bargain'). Formula: Expectation Damages = (Loss of Value of Breaching Party's Promised Performance) + (Incidental Damages) + (Consequential Damages) - (Expenses Saved / Cost Avoided by Non-Breaching Party).
30	What is the difference between Mutual Mistake and Unilateral Mistake as defenses to contract formation?	• Mutual Mistake: Both parties mistaken as to a basic assumption of fact having a material effect on agreed exchange. Contract is voidable by adversely affected party UNLESS they bore the risk of mistake (Restatement § 152; Sherwood v. Walker). • Unilateral Mistake: Only one party mistaken. Not voidable UNLESS: (a) non-mistaken party knew or had reason to know of the mistake (e.g., obvious mathematical bid error), or (b) the mistake makes enforcement unconscionable.
31	What is Anticipatory Repudiation, and what options does the non-repudiating party have?	An unambiguous statement or conduct indicating that a party cannot or will not perform their material contractual obligations before performance is due. Non-repudiating party may: (1) Treat repudiation as total breach and sue immediately for damages; (2) Suspend own performance and wait until performance date; (3) Treat contract as rescinded and discharge duties; or (4) Urge performance. Repudiating party can retract before non-repudiator sues or materially relies.
32	Under UCC § 2-207 (Battle of the Forms), how does an acceptance with additional terms operate between Non-Merchants vs. between Merchants?	A definite and seasonal expression of acceptance operates as an acceptance even though it states terms additional to or different from those offered, unless acceptance is expressly made conditional on assent to the additional terms. • If at least one party is a Non-Merchant: Additional terms are treated as mere proposals for addition and do NOT become part of contract unless offeror expressly agrees. • Between Merchants: Additional terms automatically become part of contract UNLESS: (a) Offer expressly limits acceptance to offer terms; (b) Terms materially alter the contract; or (c) Notification of objection is given within a reasonable time.