SOUTH CAROLINA LAW SCHOOL 1L STUDY GUIDE FOR CONTRACTS
I. Fundamental Concepts in Contract Law
- Offer and Acceptance
- Offer: A promise to do or refrain from doing something conditioned upon another party’s acceptance.
- Acceptance: Reflects an offeree’s assent to the terms of the offer. It must mirror the offer exactly to create a contract.
- Case: Lucy v. Zehmer – The court held that an agreement is considered an offer if an objective, reasonable person would interpret it as such.
- Essential for a contract to be enforceable. It represents anything of legal value exchanged between parties.
- Case: Hamer v. Sidway – The court ruled that forbearance can serve as valid consideration.
- Mutual Assent
- Both parties must agree on the terms of the contract.
- Case: Raffles v Wichelhaus – The court held that both parties must have the same understanding of the contract’s terms for it to be enforceable.
- Parties must be legally capable of entering a contract. This includes being of legal age and mental competence.
- Case: Mentor v. Faber – The court ruled that contracts entered into with minors or mentally incapacitated individuals are unenforceable.
II. Contract Defenses
- Occurs when a person enters into a contract due to unlawful pressure. The contract may be voided if proven.
- Case: Totem Marine v. Alyeska Pipeline – The court held that economic duress may void a contract.
- A contract can be voided if one party intentionally misrepresents material facts leading to the contract.
- Case: Burger King Corp. v. Weaver – The court determined fraudulent misrepresentation had occurred and invalidated the contract.
- A contract can be voided if a mutual mistake of material fact was made at the time of contracting.
- Case: Sherwood v. Walker – The court voided a contract due to a mutual mistake regarding the cow’s fertility.
III. Contract Performance and Breach
- Fulfilling the contractual duties as promised.
- Case: Jacob & Youngs v. Kent – The court held “substantial performance” was enough to fulfill a contract.
- Occurs when one party fails to perform as promised.
- Case: Hawkins v. McGee – The court held that a breach occurs when the result promised in the contract is not delivered.
IV. Remedies for Breach
- Monetary compensation for a breach. Can be compensatory, consequential, or punitive.
- Case: Hadley v. Baxendale – The court set limits on consequential damages.
- Specific Performance
- Court-ordered performance of the duty under the contract. Usually happens when damages are insufficient.
- Case: Laclede Gas Co. v. Amoco Oil Co. – The court ordered specific performance due to the unique nature of the contract.
- Restores the injured party to the position they were in before the contract.
- Case: Oliver v. Campbell – The court ordered restitution after a breach of contract.
V. Contract Interpretation
- Parol Evidence Rule
- Prohibits the introduction of evidence outside the terms of the written contract.
- Case: Mitchill v. Lath – The court excluded oral agreements made prior to the written contract.
- Impossibility / Impracticability
- Discharge of a contract may occur if performance becomes impossible or impracticable.
- Case: Taylor v. Caldwell – The court discharged a contract due to impossibility of performance.
- Good Faith
- Parties are required to act in good faith in performance and enforcement of a contract.
- Case: Market Street Associates v. Frey – The court held a duty of good faith in performance.
Studying the aforementioned cases and understanding the applied legal principles will provide an excellent foundation for your examination in Contracts, and ensure a strong understanding of the fundamental components of contract law in South Carolina.