Offer Termination by Operation of Law

I had a student ask about something in their barbri regarding a note under “Termination by Death of Insanity of Parties”. It was in regards to irrevocable offers.
I read that section several times myself when I was preparing the lesson plan. I thought I understood it, but when I saw the student’s question, it made me revisit it. First off, I want you to know that I’ve never seen this tested, and doubt it ever would be tested. So that’s good news. I’ll answer your question in several parts.
The restatement is very straight forward on this issue, but doesn’t discuss options.
§ 48 Death or Incapacity of Offeror or Offeree 
 
An offeree’s power of acceptance is terminated when the offeree or offeror dies or is deprived of legal capacity to enter into the proposed contract.
 

However, both barbi and CALI discuss how irrevocable offers (e.g. options) don’t terminate in this situation. I decided to look up the caselaw. It’s likely that most jurisdictions track to California on this issue.

“An option is an offer and if it is without consideration, it is revoked by the death of the offeror prior to acceptance. *452 If consideration is given, it is a contract binding upon the offeror and upon his successors in interest after his death. See case cited in 6 Cal.Jur., pp. 48–53, §§ 27, 28, 29; Williston, Contracts (Revised Ed.), §§ 61, 62; Cal.Civ.Code, § 1587(4).” (Bard v. Kent (1942) 19 Cal.2d 449, 451–452 [122 P.2d 8, 10])

 

So an irrevocable offer does not terminate by operation of law in the case of death or incapacity. A successor in interest can be the decedent’s estate, etc.

Some quick notes on procedural history

One of the things we to when briefing cases is the procedural history of the case. While every state has its own court hierarchy, most follow a structure similar to the federal government (i.e. trial -> appellate -> supreme). On the other hand, some are quite different.

While you’ll be exposed to federal cases and cases from every state, a majority of cases you’ll encounter will be from California and New York. Given the populations of those two states, it makes sense that there’s a great deal of litigation coming from them.

:book: California courts follow a structure very similar to that of the federal government.

California

:book: New York (NY) Courts have a very different structure.

New York

You can follow the link below to see how NY criminal courts are structured. It’s not relevant here because we’re concerned with contract law. At any rate, this should help if you’re confused by the NY court structure.


References
https://www.uscourts.gov/about-federal-courts/court-role-and-structure
https://www.courts.ca.gov/2113.htm
http://www.nycourts.gov/courts/structure.shtml

Tips for briefing

One of my students found this and said they found it extremely helpful. The case it uses as an example, Lucy v. Zehmer, a foundational case for formation, and one of the things we cover in week 2.

 

Law School Stuff

Before I started this CALI.org hosted blog, I had a tumblr where I collected legal stuff as both a law student and later as a practicing attorney. Some of the entries are likely helpful to students.

Law School Stuff

https://rds-pcl-outlines.tumblr.com

Q: Does California use the Predominant Factor Test?

A: Yes

See C9 Ventures v. SVC-West, L.P. (2012) 202 Cal.App.4th 1483, 1494 [136 Cal.Rptr.3d 550, 559][“We find no legal test to determine whether a hybrid transaction involving lease of a vessel and sale of its contents is a lease or transaction for the sale of goods. However, in deciding the somewhat analogous question whether a hybrid transaction for goods and services is predominantly a sale of goods governed by the Uniform Commercial Code, or predominantly a transaction for services governed by common law, courts have looked to the essence of the transaction. (Filmservice Laboratories, Inc. v. Harvey Bernhard Enterprises, Inc. (1989) 208 Cal.App.3d 1297, 1305, 256 Cal.Rptr. 735; Bonebrake v. Cox (8th Cir.1974) 499 F.2d 951, 960.) The court may compare the relative cost of the goods and services in the transaction and the purpose of the agreement in order to determine whether it is predominantly a sale of goods or transaction for services. (See Pittsley v. Houser (1994) 125 Idaho 820, 823, 875 P.2d 232, 235 [transaction for purchase and installation of carpet predominantly transaction for sale of goods].) “The test for inclusion or exclusion is not whether [goods and services] are mixed, but, granting that they are mixed, whether their predominant factor, their thrust, their purpose, reasonably stated, is the rendition of service, with goods incidentally involved (e.g., contract with artist for painting) or is a transaction of sale, with labor incidentally involved (e.g., installation of a water heater in a bathroom).” (Bonebrake v. Cox, supra, 499 F.2d at p. 960, fns. omitted.)]

Assignments for Credit

Fall Assignments for Credit

You’ll note that your syllabi allow 15% for assignments. They are required and part of your overall grade.

Did poorly on the midterm? Worried that you might underperform on the final? Here’s how you can earn some points to offset the exams.

1) 10 point assignments (1a or 1b)

a) If you did poorly on the midterm, write a document explaining what you would do differently now. Which issues did you miss? Which rules were sketchy? Was your analysis light on, well, analysis? What would you do better if you could take the same exam again. I don’t want a rewrite of the essay. I want you to go through your own work as if you were grading someone else. This exercise is intended to help you think from the standpoint of a bar exam grader.

or

b) Did well on the midterm? Pick two issues of contract law that you’ve learned so far this year and find a case for each from our assigned case readings that you feel best illustrates the rule in the way that it’s addressed on bar exam type essays. Discuss how you feel the court addresses the issue, and how you could use similar analysis if you ran into a comparable fact pattern in an essay. Do not recount the facts of the cases. This is an assignment to identify holdings within the case that you could use for IRAC of your own.

2) 5 point assignment

Pick two different issues of contract law that you’ve learned so far this year and write out an MBE-style fact pattern and four answer choices for each. Use existing MBEs as a guide for the length and complexity, but DO NOT copy someone else’s MBE and then claim it’s  yours. That’s plagiarism. Moreover, this exercise is very beneficial in that it really forces you to understand and think though an issue of law carefully. If you do this right, you’ll have a better understanding of the two issues you pick.

Requirements and Due Date

Assignments are due the day of your final examination—November 14, 2019. I require a printed copy of the assignment be turned into me. You can send a digital copy as well, but I will only grade physical, printed copies turned in by the deadline.

You may turn in both assignments 1 and 2. A maximum score of 15 points will be awarded to work that fits the criteria supra. Please submit assignments that are a reasonable length. Be concise, but turn in something substantive. Sophomoric efforts will be graded accordingly.

Winter assignments for credit

You’ll note that your syllabus allows 15% for assignments. Last quarter I didn’t make it clear that this is something I expect every student to work on. This quarter, I want everyone to know that they must turn in work for this credit that goes towards 15% of their grade. The due date and other information are on the bottom, I’m sending it out now in case it’s easier for some of you to work on over the holidays, instead of waiting to the end of the quarter.

1) 10 point assignments (1a or 1b or 1c)

a) Is there an issue or issues that you keep missing or still misunderstand? Come up with a comprehensive project that helps you master that issue. Explain your approach in the beginning of the project and then show your work. Maybe a lesson plan that you would use to teach it to others, or an essay or two that features your problem issue, or a short paper on the issue that increases your understanding of it. If you have an idea, but want to double-check it, send it to me via email.

– or –

b) Pick two issues of contract law that you’re struggling with and find essays on CalBar’s website. Try to write the essays and then do the three-column method of checking the issues you spotted to the two student answers supplied by the Committee of Bar Examiners. After you complete your columns, write up an analysis of what you got right, what you missed, and what you need to improve on. Turn the whole thing in, your essay, the column comparison, and your analysis.

– or –

c) Pick two issues of contract law that you’ve learned so far this year and find a case for each from our assigned case readings that you feel best illustrates the rule in the way that it’s addressed on bar exam type essays. Discuss how you feel the court addresses the issue, and how you could use similar analysis if you ran into a comparable fact pattern in an essay. Do not recount the facts of the cases. This is an assignment to identify holdings within the case that you could use for IRAC of your own.

2) 5 point assignment

Pick two different issues of contract law that you’ve learned so far this year and write out an MBE-style fact pattern and four answer choices for each. Use existing MBEs as a guide for the length and complexity, but DO NOT copy someone else’s MBE and then claim it’s  yours. That’s plagiarism. Moreover, this exercise is very beneficial in that it really forces you to understand and think though an issue of law carefully. If you do this right, you’ll have a better understanding of the two issues you pick.

Requirements and Due Date

Assignments are due the day of your final examination—February 20, 2020. I’ll except items earlier. I require a printed copy of the assignment be turned into me. You can send a digital copy as well, but I will only grade physical, printed copies turned in by the deadline.

You may turn in both assignments 1 and 2. A maximum score of 15 points will be awarded to work that fits the criteria supra. Please submit assignments that are a reasonable length. Be concise, but turn in something substantive. Sophomoric efforts will be graded accordingly.

Spring assignments for credit

You’ll note that your syllabus allows 15% for assignments. Like with every other quarter, I want everyone to know that they must turn in work for this credit that goes towards 15% of their grade. The due date and other information is on the bottom.

1) 10 point assignments (1a or 1b or 1c)

a) Is there an issue or issues that you keep missing or still misunderstand? Come up with a comprehensive project that helps you master that issue. Explain your approach in the beginning of the project and then show your work. Maybe a lesson plan that you would use to teach it to others, or an essay or two that features your problem issue, or a short paper on the issue that increases your understanding of it. If you have an idea, but want to double-check it, send it to me via email.

– or –

b) Pick two issues of contract law that you’re struggling with and find essays on CalBar’s website. Try to write the essays and then do the three-column method of checking the issues you spotted to the two student answers supplied by the Committee of Bar Examiners. After you complete your columns, write up an analysis of what you got right, what you missed, and what you need to improve on. Turn the whole thing in, your essay, the column comparison, and your analysis.

– or –

c) Pick two issues of contract law that you’ve learned so far this year and find a case for each from our assigned case readings that you feel best illustrates the rule in the way that it’s addressed on bar exam type essays. Discuss how you feel the court addresses the issue, and how you could use similar analysis if you ran into a comparable fact pattern in an essay. Do not recount the facts of the cases. This is an assignment to identify holdings within the case that you could use for IRAC of your own.

2) 5 point assignment

Pick two different issues of contract law that you’ve learned so far this year and write out an MBE-style fact pattern and four answer choices for each. Use existing MBEs as a guide for the length and complexity, but DO NOT copy someone else’s MBE and then claim it’s  yours. That’s plagiarism. Moreover, this exercise is very beneficial in that it really forces you to understand and think though an issue of law carefully. If you do this right, you’ll have a better understanding of the two issues you pick.

Requirements and Due Date

Assignments are due the day of your final examination—May 14, 2020. I’ll except items earlier. I require a printed copy of the assignment be turned into me. You can send a digital copy as well, but I will only grade physical, printed copies turned in by the deadline. We may have to change the physical copy requirement, depending on whether we’re able to return to the classroom by that time.

You may (read should) turn in both assignments 1 and 2. A maximum score of 15 points will be awarded to work that fits the criteria supra. Please submit assignments that are a reasonable length. Be concise, but turn in something substantive. Sophomoric efforts will be graded accordingly.

Lesson Link Titles

Quarter – Fall

Overview and Sources of Contract Law
History of Equity

Invitations to Negotiate and other Expressions that are not Offers
Express and Implied Contracts
Bilateral and Unilateral Contracts

Offer
Indefiniteness
Duration of Offers

Option Contracts and Firm Offers

Acceptance
The Mailbox Rule
Formation of Contracts under UCC Article 2

Battle of the Forms (UCC 2-207)

Consideration: The Basics of Consideration and the Bargain Theory
Agreements Lacking Consideration: Gift Promises
Agreements Lacking Consideration: Past Consideration and Moral Obligation
Satisfaction Clauses

Reliance Damages
Mutuality of Obligation
Consideration: Advanced Issues

The Statute of Frauds

Quarter – Winter

Void, Voidable and Unenforceable Contracts
Illegal Promises
Defenses
Duress and Undue Influence
Misunderstanding and Mistake
Unjust Terms (Unconscionability)

Lack of Capacity
Fraud and Misrepresentation

The Parol Evidence Rule

Interpretation of Contracts
Implied Terms
Good Faith
Promises, Conditions, Warranties, and Representations

Conditions

Contract Tutorials on Remedies – Excuse of Performance

Anticipatory Repudiation and Assurances of Performance

Installment Contracts

ITT v LTX. An Interactive Exploration of UCC Article 2

Accord and Satisfaction
The Pre-Existing Duty Rule, Contract Modification, and Accord & Satisfaction

Quarter – Spring

Installment Contracts

Risk of Loss
Substantial Performance
Contract Tutorials on Remedies – Substantial Performance/Breach
Warranties

An Introduction to Contract Remedies
Expectation Damages
Liquidated Damages
Certainty
Foreseeability
Mitigation
Contract Tutorials on Remedies – Overhead and Profit
Contract Tutorials on Remedies – Liquidated Damages
Contract Tutorials on Remedies – Proving Damages
Contract Tutorials on Remedies – Reliance Damages
Contract Tutorials on Remedies – Foreseeability
Contract Tutorials on Remedies – Cost of Completion

UCC Remedies: Seller’s Remedies When Buyer is in Breach
UCC Remedies: Buyer’s Remedies When the Seller is in Breach
Contract Tutorials on Remedies – UCC Damage Rules
Contract Tutorials on Remedies – Expectation Damages in Sale of Goods
Contract Tutorials on Remedies – UCC Damage Rules for Buyers
Contract Tutorials on Remedies – Expectation Damages in Sale of Goods – Buyer does not cover

Equitable Remedies – An Overview
Reliance Damages
Restitution
Specific Performance
Contract Tutorials on Remedies – Restitution
Contract Tutorials on Remedies – Specific Performance

Third Party Beneficiaries
Exploring Article 2

Assignment and Delegation