Theme: Dispute Resolution. Also: Capitalism & Centralization. 1. Underlying purposes of Contract Law 2. Elements 3. Unenforceable Agreements 4. Warranties 5. Cases and Resolution 6. Landlord / Tenant Contract and Property Law – Outline

Law Agenda Purpose: Finish up and review contract law concepts. Partner Work (15 mins): –Discuss and markup “Contract Hypothetical” worksheet (use your Law 101 Contracts notes and the unit outline) Large Group: –Review Worksheet and Contract Law generally (15 mins) –Agree Disagree

Contract Agree – Disagree 1. G+G History Fair Consulting 2. Cookies for Dancing 3. Martha’s Vineyard home sale 4. Aren and Altruism

Purposes of Contract Law Fundamental to business and economic well-being –A difference between developed world and developing world –Economic Prosperity – people make deals and they are upheld. Deals are the basis of a modern economy. Stability and Dispute Resolution Capitalism: Freedom of Contract – the right of people to make their own arrangements regarding themselves and their stuff Centralization: Contract enforcement itself requires government. So it makes sense that there are limits to freedom of contract for the greater good.

Contract = Legally enforceable promise Offer and Acceptance –Offer must be made to a specific person, group or organization –There must be a “meeting of the minds”. Consideration – an exchange of value (not just a gift) Objective theory –Not what the people believed but what they should have believed given conduct of parties Elements of a Contract

“Statute of Frauds” –Contracts must be in writing for “big deals” Real Estate, $500 of goods, surety (paying someone else’s debts), marriage Capacity: Mental Illness, Age for Minors (but Ratification once 18), Intoxication Duress: Not freely entered into Unconscionability (Completely unfair) Form Contracts: The “fine print” – mixed enforceability Warranties –Implied and express Unenforceable Agreements

Specific Performance –Court forces party to perform contract –Relatively rare Damages $$ –Expectation Damages: Put the parties in the financial position they would have been if the contract had been fulfilled –Restitution Damages: Recovery of benefits conferred to other party (ex. return of down payment) –Reliance Damages: Compensating parties for expenditures incurred expecting the contract to be fulfilled Cases and Resolution – Breach of Contract

1. Contracts must be in writing for “big deals” 2. Contract must be an exchange of value (not just a gift) 3. A legally enforceable promise 4. When agreement is not freely entered into 5. Court forces party to perform contract 6. Compensating for expenses expecting contract to be fulfilled 7. Lack of state of mind to enter into valid contract 8. Elements of a contract: ___ and ___ 9. Completely unfair – so unenforceable (relatively rare) 10. Contracts are interpreted by what parties should have believed given the conduct of the parties 11. “The small print” with a dominant party –enforceable but not completely under all circumstances 12. Idea that people should be able to make their own deals 13. Put parties in the financial position would have been if contract fulfilled 14. Unwritten guarantee created by law protecting consumers 15. Unwritten guarantee that the seller actually owns the property being sold Contract Law – Reverse IDs