1、American Contract Law,Introduction,The American democracy is based on the following six essential principles: 1.the majority rules 2.protection of political rights of minorities 3.citizen agree to be ruled by a system of law 4.free exchange of ideas and opinions 5.equality of all citizens 6.govermen
2、t exists to serve the people,Sources of American law,There are four sources of American law: the constitution, statutory law, common law and equity. the constitution is the supreme law of the united states. it describes what powers the government has, as well as what rights us citizens have. All oth
3、er laws must comply with the constitution. It has six basic principles.,Statutory law,Statutory law is written law that is passed by legislatures, congress, state legislatures, and local government all enact statues. While constitutional law is broad and leaves room for interpretation, statutory law
4、 is generally more detailed and precise. Regulations passed by agencies are even more specific than statutes.,Common law,the laws based on previous court ruling are called common law or case, law. This system date back to eleven century England where judges contemplating a case would refer to previo
5、us decision. When common law is in conflict with statutory law, the statutory law is upheld.,equity,Equity cases deal with the fairness or justice of a situation Judges decide the issues, and a jury is not present. The judges often order injunctions to prevent the unfair act from happening again.,Pu
6、blic law and Private law,Private laws deal mainly with disputes between individuals, businesses, or other organizations. The outcome of these disputes is usually a fine or award of money as opposed to a jail sentence. Private law encompasses property, contracts, family relation and tort.,Public law,
7、Public law deal with the relationship between the government and its citizens. The four categories of public law are constitutional law, international law, criminal law and administrative law.,The Main sources for contract law,Common law Treatises Restatement of contract The uniform commercial code,
8、treatises Every student comes across reference to Professor Willistons and Professor Corbins treatises.,Restatement of contract,The American Law Institute published the Restatement (first) of Contract in 1932. The Restatement set forth a series of black letter rules governing contract formation, ope
9、ration, breach, etc., by restating the majority rules governing those principles adopted by courts throughout the country.,Uniform Commercial Code,The Uniform commercial Code is a set of statutes that govern commercial transactions throughout the United States. It is divided into nine substantive se
10、ctions, called Articles.,The legislative branch,The legislative branch is a bicameral system, which means that it is composed of two houses, the Senate (参议院）and the House of Representatives(众议院）as outlined in the united States constitution. The U.S. Senate is made up of 100 members, two elected from
11、 each state .the House of Representatives is composed 435 members elected every two years from among the 50 states, apportioned to their total populations. These two houses together form the US Congress and mainly responsible for passing statutory, also known as legislative law.,Federal Court System
12、,Supreme court,The supreme court is the highest court in the federal court system and was created by the constitution. Its decisions cannot be overturned. The supreme court consists of one chief justice and eight associates.,Court of appeals,If there is a question regarding the fairness of a trial,
13、a case can be appealed to the court of appeals. Here, the case reviewed by a panel of judges who determine if the district court was correct. If they need clarification on a point, they can ask to hear oral statement. these courts are also known as circuit courts and they are arranged according to g
14、eography, with 12 circuits in all,US district courts,There 94 district courts. These courts have original jurisdiction over both criminal and civil federal laws. In criminal cases, a grand jury decides if there is enough evidence to try the case. A trial jury then determines if the person is guilty.
15、 In civil cases, can be used or can be waived if the both parties agree. In these cases, a federal judge makes the final decision.,Special courts,Congress has set up special courts to deal with specific problems. One of these courts is,American Contract Law,Chapter 1. Meaning Of Terms,The definition
16、 of contract,Restatement Definition A contract is a promise or a set of promises for the breach of which the law gives a remedy, or the performance of which the law in some way recognizes as a duty. (restatement first) In essence, under the Restatement, a contract is a promise or set of promises tha
17、t are enforceable in the courts if one party fails to perform what he or she promised.,UCC Definition 1-201(12) of the UCC defines a contract as “the total legal obligation that result from the parties agreement”,Distinction between restatement and UCC definitions,In the most cases, a contract under
18、 the Restatement will also be one under the UCC. The one place where there will be a contract under the UCC, but not one under the Restatement, is when both parties complete all of their performance at or about the time their agreement is made.,Comment:,a. A contract may consist of a single promise
19、by one person to another, or of mutual promises by two persons to one another; or there may be, indeed, any number of persons or any number of promises. One person may make several promises to one person or to several persons, or several persons may join in making a single promise to one or more per
20、sons. It is essential, however, for the formation of a single contract that all the promises shall form part of a set. In other words they must be parts of a single transaction.,b. It is not practicable in a definition of contract to state all the operative facts that are necessary or sufficient, or
21、 to state all the legal relations that are created by such facts. These will appear with greater fullness in the succeeding chapters and sections.,c. It has been pointed out that the word contract is often used to express indifferently,1. The acts which create the legal relations between the parties
22、, 2. A writing which if not itself such an act is the evidence of such acts; 3. The legal relations resulting from the operative acts.,As the term is used in the Restatement of this Subject, “contract” includes not only the act of making a promise or promises but the intangible duties which arise. S
23、imilarly “promise,” under the definition in , includes not merely the act of speaking, but the continuous duty, whether moral or legal, which a assumes when he makes a promise. The separation is not made in ordinary legal speech, and is not made in the Restatement of this Subject, between the physic
24、al act of speaking words of promise and the intangible duties which thereupon arise.,d. Not all the operative acts which are essential to create contractual relations between the parties are included in the definition. It does not attempt to state what acts are essential. When an act is done as the
25、consideration for a unilateral contract (see 12), and is essential to make the promise obligatory, the act is not a part of the promise, and hence is not part of the contract as contract is here defined. Similarly, delivery is necessary to make a sealed promise binding, but delivery is not part of t
26、he contract.,e. The term contract is generic. As commonly used, and as here defined, it includes varieties described as voidable, unenforceable, formal, informal, express, implied (see Comment a to 5) unilateral, bilateral. In these varieties neither the operative acts of the parties nor the resulti
27、ng relations are identical.,Illustration:,1. A orally agrees to sell land to B; B orally agrees to buy the land and pays $1000 to A. The agreement is unenforceable under the Statute of Frauds. Bs right to restitution of the $1000, however, is governed by the same rules as if the agreement were enfor
28、ceable. B has a right to recover the $1000 paid if A refuses to convey the land, but not if A is ready and willing to convey. See 140 and the provisions on restitution in 375. By virtue of this indirect recognition of the duty to convey, the agreement is a contract.,The definition of Promise,(1) A p
29、romise is an undertaking, however expressed, either that something shall happen, or that something shall not happen, in the future.,(2) Words which in terms promise the happening or failure to happen of something not within human control, or the existence or non-existence of a present or past state
30、of facts, are to be interpreted as a promise or undertaking to be answerable for such proximate damage as may be caused by the failure to happen or the happening of the specified event, or by the existence or non-existence of the asserted state of facts.,Illustrations:,1. A on seeing a house of thor
31、oughly fireproof construction says to B, the owner, “This house will never burn down.” This is not a promise but merely a prophecy. 2. A, the builder of a house, or the inventor of the material used in part of its construction, says to B, the owner of the house, “I warrant that this house will never
32、 burn down.” This is in effect a promise to be answerable for any proximate harm if the house should burn down; and if made for sufficient consideration is a contract.,3. A, by a charter-party undertakes that the “good ship Dove A 1,” having sailed from Marseilles a week ago for New York, shall take
33、 on a cargo for B on her arrival in New York. The statement of the quality of the ship and the statement of her time of sailing from Marseilles are in effect promises to pay for any proximate injury if the statements are untrue.,4. A says to B, “I will employ you for a year at a salary of $5000 if I
34、 go into business.” This is a promise, for although it is wholly optional with A to go into business or not, he does not keep his word if he goes into business without employing B. 5. A says to B that he will employ him for a fixed term at such salary as A sees fit to pay. This is not a promise to p
35、ay any salary.,Promise;,A promise is a manifestation of intention to act or refrain from acting in a specified way, so made as to justify a promisee in understanding that a commitment has been made.,Promisor; Promisee; Beneficiary,The person manifesting the intention is the promisor. The person to w
36、hom the manifestation is addressed is the promisee. Where performance will benefit a person other than the promisee, that person is a beneficiary.,The definition of. Agreement,An agreement is a manifestation of mutual assent by two or more persons to one another.,Comment:,a. Agreement has a wider me
37、aning than contract, bargain or promise. The word contains no implication that legal consequences are or are not produced. It applies to transactions executed on one or both sides, and also to those that are wholly executory. The word contains no implication of mental agreement. Such agreement usual
38、ly but not always exists where the parties manifest assent to a transaction.,b. Manifestation of assent may be made by words or by any other conduct (see 21). Even silence under some circumstances is such a manifestation (see 72)., 21. Acts As Manifestation Of Assent,The manifestation of mutual asse
39、nt may be made wholly or partly by written or spoken words or by other acts or conduct., 72. Acceptance By Silence Or Exercise Of Dominion,(1) Where an offeree fails to reply to an offer, his silence and inaction operate as an acceptance in the following cases and in no others: (a) Where the offeree
40、 with reasonable opportunity to reject offered services takes the benefit of them under circumstances which would indicate to a reasonable man that they were offered with the expectation of compensation. (b) Where the offeror has stated or given the offeree reason to understand that assent may be ma
41、nifested by silence or inaction, and the offeree in remaining silent and inactive intends to accept the offer.,(c) Where because of previous dealings or otherwise, the offeree has given the offeror reason to understand that the silence or inaction is intended by the offeree as a manifestation of ass
42、ent, and the offeror does so understand. (2) Where the offeree exercises dominion over things which are offered to him, such exercise of dominion in the absence of other circumstances showing a contrary intention is an acceptance. If circumstances indicate that the exercise of dominion is tortious t
43、he offeror may at his option treat it as an acceptance, though the offeree manifests an intention not to accept.,The definition of Bargain,A bargain is an agreement of two or more persons to exchange promises or to exchange a promise for a performance.,a. Bargain has a narrower meaning than agreemen
44、t, since it is applicable only to a particular class of agreements. It has a broader meaning than contract. It includes transactions where one party makes a promise and the other gives something in exchange which is insufficient consideration. It also includes transactions where what would otherwise
45、 be a contract is invalidated by illegality. As here defined for the purposes of the Restatement of this Subject, it does not include completely executed transactions, such as exchanges of goods (barters) or of services, or sales where goods have been transferred and the price paid for them.,How A P
46、romise May Be Made,Except as stated in 72(2), a promise in a contract must be stated in such words either oral or written, or must be inferred wholly or partly from such conduct, as justifies the promisee in understanding that the promisor intended to make a promise.,a. Contracts are often spoken of
47、 as express or implied. The distinction involves, however, no difference in legal effect, but lies merely in the mode of manifesting assent. Implied contracts must be distinguished from quasi-contracts, which also have often been called implied contracts or contracts implied in law. Quasi-contracts,
48、 unlike true contracts, are not based on the apparent intention of the parties to undertake the performances in question, nor are they promises. They are obligations created by law for reasons of justice. Such obligations were ordinarily enforced at common law in the same form of action (assumpsit)
49、that was appropriate to true contracts, and some confusion with reference to the nature of quasi-contracts has been caused thereby.,1. A telephones to his grocer, “Send me a barrel of flour.” The grocer sends it. A has thereby contracted to pay a reasonable price therefor. 2. A, on passing a market,
50、 where he has an account, sees a box of apples marked “5cts. each.” A picks up an apple, holds it up so that a clerk of the establishment sees the act. The clerk nods, and A passes on. A has contracted to pay five cents for the apple.,3. As wife, B, separates from A for justifiable cause, and, in order to secure necessary clothing and supplies, buys them from C, charges their cost to A. A is bound to pay for them, though he has directed C not to furnish his wife with such supplies; but As duty is quasi-contractual, not contractual.,
