LAW OF CONTRACT

CHAPTER I: AN OVERVIEW OF CONTRACT LAW

1. Sources of Contract Law: Common law governs all contracts except sales
and leases
- Sale and lease contracts are governed by the Uniform Commercial
Code (UCC)
2. Function of Contract Law: To assure the parties to private agreements that
the promises they make will be enforceable
3. Promise: A person’s declaration that he will perform or refrain from
performing some present or future act.
- The promisor makes the promise and the promisee is the person to whom
the promisor made the promise
4. Definition of a Contract: A contract is an agreement formed by two or
more parties who agree to a promise (or set of promises)
- Contracts can be enforced in court
- Voidable: có thể vô hiệu bởi 1 trong những người tham gia hợp đồng
- Annulled marriage: hủy kết hôn
- Performance contract: Hợp đồng mới được đề nghị chứ chưa được hoàn
tất
5. Objective Theory of Contracts: The circumstances that determine the
intent of the parties. Objective facts include:
- What a party said when entering into the contract
- How the party acted or appeared
- The circumstances surrounding the transactions.
6. Requirements of a Valid Contract:
- Agreement (offer and acceptance)
- Consideration (Legally sufficient and bargained-for). (Note: Gratuitious
giving is not legally sufficient)
- Contractual Capacity (All parties must be competent)
- Legal (Purpose of contract must be legal at time of execution)
7. Quasi contracts: is not a contract but impose a contract for fairness and
justice
Limitations on Quasi-Contractual Remedy: The enriched party is not held
liable in certain situations.
When an actual contract exists that covers the matter in controversy, the
doctrine of quasi contract generally cannot be used.
 8. Types of contracts:
- Express: The terms of the agreement (oral or written) are explicitly
stated
- Implied (in fact): Conduct creates and defines the terms of contract
- A contract can be a mixture of an express and an implied contract – with
some express terms and implied terms

Contract Formation

Bilateral Formal
Express Requires a special form
A promise for a Formed by words
promise for creation
Implied
Unilateral Informal
Formed by the coduct
A promise for an act Requires no social for
of the parties
for creation

9. An overview of contract law:

- Promise: A person’s declaration that he will perform or refrain from
performing some present or future act.
 The promisor makes the promise and the promise is the person to
whom the promisee made the promise.
- Definition of a contract: A contract is an agreement formed by two or
more parties who agree to a promise (or set of promises)
 Contracts can be enforced in court
*A white line: Lời nói dối trắng
10. Elements of a Contract
- Requirements of a Valid Contract:
 Agreement (Offer and acceptance)
  Consideration (Legally sufficient and bargained – for). (Note:
Gratuitous giving is not legally sufficient)
Đối với Luật Hoa Kì hợp đồng chỉ phát sinh nghĩa vụ với 1 bên thì
đó không tính là hợp đồng
 Contractual Capacity (All parties must be competent)
 Legal (Purpose of contract must be legal at time of execution)
 Defenses to Enforceability:
 Voluntary Consent: All parties must voluntarily consent to
the contract
 Form: Some types of contracts must be in writing
*Commercial paper: thương phiếu
*Negotiation certification: những chi phiếu có giá trị
11. Differentiate the valid contract and void contract:

Enforcable Contract
A valid contract that can be enforced
because there are no legal defenses against
it.

Valid contract
A contract that has the neccesary Voidable Contract
contractual elements argument, A party has the option of avoiding or
consideration, legal capacity of the parties, enforcing the contractual obligation
and the legal purpose

Unenforceable Contract
A contract exists, but it can not be enforced
becasue of a legal defense
 Void Contract
No contract exists, or there is a No contract
contract without legal obligation

*Possesion:
*Assign right: nhận quyền lợi
*Delegate obligation: Thực hiện nghĩa vụ
* Ở Hoa Kì, đối với HĐ bất động sản bên có quyền có yêu cầu bên có
nghĩa vụ thực hiện đúng những gì đã thỏa thuận trên HĐ thay vì bồi
thường vi phạm
*Gratuitous = tips
*Summary judgement: Giống như chưa xử án đã có phán quyết (hơi giống
thủ tục rút gọn)
*Appeal: kháng cáo

12. Interpretation of Contract:

- Plain language laws have helped to alleviate disputes on the legal
meaning and effect of a contract
- “Plain meaning” Rule: A court will enforce a contract according to its
obvious terms when it is clear and unequivocal
- Ambiguity: A contract is unclear or ambiguous when:
 The parties’s intent cannot be determined from the contract’s
language
 The contract lacks a provision on a disputed term
 A term is susceptible to more than one interpretation
 When there is uncertainty about a provision.
- Extrinsic Evidence:
  A court may interpret ambiguous terms against the party who
drafted the term, or consider extrinsic evidence.
 When a contract is clear and unambiguous, a court cannot consider
extrinsic evidence

- Other rules of interpretation:

 A reasonable, lawful, and effective meaning will be given to all of
a contract’s terms as much as possible
 Contracts are interpreted as a whole
 Terms that are negotiated separately are given greater weight than
the standardization terms.
 Words will be given their ordinary, commonly accepted meanings
 Specific wording given greater weight than general language.
 Written or typewritten given greater weight than preprinted.
 Express terms are given the greatest weight, followed by course
of performance, course of dealing, and custom and usage of trade –
in that order.
13. Agreement = offer and acceptance
- Parties must show mutual essent to terms of contract
- Once an agreement is reached, if the other elements of a contract are
present, a valid contract is formed.
1. Offer:
 Requirements of the Offer:
 Offeror must have a serious intention to be bound by the
offer
 The offer’s terms must be reasonably certain, or definite.
 The offer must be communicated to the offeree
 Definiteness of Terms: Generally, an offer must express the
following items:
 Identification of the parties
 Object or subject matter of the contract
 Consideration to be paid
 Time of payment, delivery or performance
*Intention: Contract is judged by what a reasonable person in the offeree’s position
would conclude about the offer
 Where intent maybe lacking: The following statements are not
offers:
 Expressions of opinion
 Statements of future intent
 Preliminary negotiations, or invitations to negotiate
 Advertisements (invitations to negotiate)
 Live and online auctions: Not an offer, but invitation to
submit offers through an auctioneer (live) or to negotiate
(online)
 Agreements to agree: Kiểu đồng ý, ưng thuận với một ý
kiến về xác lập hợp đồng  ko được xem là lời đề nghị vì
chưa có đáp ứng đầy đủ terms mà 1 offer cần có.
 Preliminary agreements
 Termination of Offer:
 An offer can be terminated either by action of the parties or
by operation of law
 Termination of Action of the Parties:
 An offer can be terminated by action of the parties by
revocation, by rejection, or by counter offer
 Revocation: Offer can be withdrawn by the offeror
anytime before offeree accepts the offer, unless the
offer is irrevocable
 Effective when the offeree or offeree’s agent receives
it
 Irrevocable offers cannot be revoked
 Option contract: A type of irrevocable offer
that is held open for a specified period of time
in return consideration.
 Termination by Operation of Law:
 Lapse of time:
 Offer t
 Destruction of the Subject Matter: If it occurs befor
acceptance of the offer, then the offer is canceled.
 Death or incompetence of the offeror or offeree:
Automatically terminates the offer unless it is an
irrevocable offer
2. Acceptance: is the voluntary statement or act from the offeree that
indicates his/her assent (agreement) to the terms of the offer
a. Unequivocal Acceptance: The acceptance cannot impose new
conditions on – or change the terms of – the original offer
b. Silence /..
i. Silence as Acceptance:
 Prior Dealings: If the offeror and offeree have prior
dealings, the offeree has the duty to reject or risk
being bound by his silence 
 Communication of Acceptance:
o With a unilateral contract, acceptance is evident
and notification is not necessary;
o With a bilateral contract, communication of
acceptance is necessary because of mutual
exchange of promises.
 Mode and Timeliness:
o Authorized Means of Acceptance: The offer
specifies (expressly or impliedly) how
acceptance should be made.
o No Acceptance if authorized means is not
used
o Substitute Method of Acceptance:
 If the offeree accepts the offer by a
substitute means, the acceptance may
still be effective if the substituted method
serves the same purpose as the
authorized means
 A contract that is formed electronically (e-
contract) must meet the same requirements (except
as to form) as a traditional contract
 Online Offers:
o Displaying the Offer: Seller’s Web site should
include hyperlink to page with full contract
o Provisions:
 Acceptance of terms: what constitutes an
acceptance
  Payment: How payment is made
 Return Policy
 Disclaimer of liability for certain uses of
the goods
o Dispute Settlement Provisions:
 Forum – Selection Clause: Location or
jurisdiction where disputes will be
resolved
 Choice – of – law clause: Disputes will
be settled …
o
 Vậy, quy tắc của 1 cái agreement (bộ phận tạo nên 1 contract) là xuất
phát từ 1 chủ thể với đầy đủ thông tin cần có và được truyền tải đến
người được đề nghị.
 Quy tắc để lời đề nghị được xem là có hiệu lực: có lời đề nghị đúng như
trên  Nếu được đồng ý bằng lời nói hoặc hành động thì ok  Nếu
bên nhận lời đề nghị từ chối, bên đề nghị rút lại hoặc hủy bỏ hoặc có
hành động như vậy, bên nhận agreement yêu cầu ngược lại với nội
dung khác thì LỜI ĐỀ NGHỊ XEM NHƯ HỦY BỎ

CHAPTER 13: CONSIDERATION

1. Consideration is usually defined as the value given in return for a
promise (in a bilateral contract) or in return for a performance (in a
unilateral contract)
2. Generally, consideration must have:
 “Legally Sufficient Value” and
 “Bargained – for – exchange.”
3. Settlement of claims:
a. Accord and Satisfaction: Debtor offers to pay a lesser amount than the
creditor purports to be owned
Ở HS, trách nhiệm minh chứng rất nặng (100%): hay còn gọi là beyond reasonable
doubt. Ở Ds, nhẹ hơn
CHAPTER 15: MISTAKE, FRAUDULENT MISREPRESENTATION,
UNDUE INFLUENCE, DURESS
- A lack of voluntary consent (assent) can be used as a defense to the contract’s
enforceability. Consent may be lacking due to:
 Mistake:
 Unilateral Mistakes of Fact:
o A mistake made by only one of the parties that does not
generally give the mistaken party any right to relief from the
contract.
o The error was due to an inadvertent, substantial
mathematical mistake and not gross (extreme) negligence
 Bilateral (Mutual) Mistakes of Fact:
o A mistake by both contracting parties about one or more
material facts generally entitles (but does not compel) either
party to rescind.
o When the parties reasonably interpret a term differently, a
court may allow the contract to be rescinded.
 Fraudulent Misrepresentation: when an innocent party is induced to
enter into a contract by a misrepresentation of material fact. The party
may avoid the contract because she/he did not genuinely consent to its
terms. Fraudulent Misrepresentation: Consists of the following elements:
o The innocent party must justifiably rely on the misrepresentation
o To prove fraud, the innocent party must show that misrepresentation
of a material fact has occurred by words or actions
o Statements of opinion and predictions (representations of future facts)
generally are not subject to claims of fraud
o Misrepresentation by Silence: Common and statutory law create a
duty to speak in certain situations (e.g., where one is aware of a
serious defect or serious risk of injury)
o Intent to deceive: Scienter exists if a party
 Knows that a fact is not as stated;
 Makes a statement that she/he believes is not true;
 Makes a statement recklessly, without
  Undue Influence
 Duress

Legality