Chapter 1 – Contract Law

Contract

• Set of legally enforceable promises, entered into by two or more parties, to make their dealings predictable and to allocate risk.

Contract Requirements

• To be enforceable, a contract must meet certain requirements:
  • Agreement
  • Consideration
  • Capacity
  • Legality

Types of Contracts:  Express or Implied

• Express contract:  has its important terms explicitly stated.
• Implied contract:  implied from the words and actions of the parties, even if they never expressed an agreement.

Types of Contract: Unilateral or Bilateral

• Unilateral contract:  contract formed when one party acts in response to other party’s promise
• Bilateral contract:  contract in which both parties make promises

Gifts

• A gift is a completed transfer of property without consideration.
• A gift becomes irrevocable when:
  • A donor with capacity
  • has voluntarily made a transfer
  • that has been accepted by the donee

Promissory Estoppel

• Promissory Estoppel:  theory under which a promise can be enforced, despite lack of consideration, because of reliance on that promise and knowledge of that reliance.
• Promissory estoppel is a legal theory for enforcing a promise if:
  • The defendant knew the plaintiff would rely on the promise
  • The plaintiff did rely on the promise; and
  • Enforcement is necessary to avoid injustice

Quasi-Contract

• Quasi-contract is a theory for avoiding unjust enrichment in situations in which a contract did not actually form.
• Quasi-contract is a legal theory, based in equity, for compensating a plaintiff if:
  • Plaintiff gave some benefit to the defendant
  • Plaintiff expected to be paid
  • Defendant had knowledge of plaintiff’s actions and expectations; and
  • Defendant would be unjustly enriched if not required to pay

Study Materials for Chapter 1

• Litigation – Resolution of disputes through the court system
• Civil Litigation:  Resolution of disputes between private parties through the court system
• Sources of Law
  
  • Statutes:  laws enacted by state or federal legislatures that govern substantive and legal rights and principles, as well as procedural rules. In some instances statutes are referred to as codes.
  • Court Cases:   decisions of the courts interpreting the law. Once a decision has been made, the court will generally write an opinion.
  • Constitutions:  The federal Constitution is the highest law of the land. In addition to the United States Constitution, each of the 50 states has its own constitution.
• Litigation Process
  • Litigation begins when the aggrieved party files a complaint in the appropriate court.
  • The aggrieved party is called the plaintiff.
  • The party whom the complaint is filed against is called the defendant.
• Complaint
  • Documents filed by an aggrieved party to commence litigation.
  • The complaint is always filed in the trial court.
  • Under the California court system, the superior court is the trial court.
  • The superior court hears unlimited general matters and also limited civil cases.
• Limited Civil Cases
  • Limited civil cases means that the court only has the power to hear and decide limited types of cases.
  • A limited civil case may be brought in the small claims division. The small claims division hears matters involving less than $5,000 in dispute. CCP §116.20.
• Summons
  • Notice accompanying the complaint that commands the defendant to appear and defend against the action within a certain period of time.
• Appeal
  • If a party loses in the trial court, that party has an automatic right to appeal to the next highest court.
  • In California, the party appeals municipal court decisions to the appellate division of the Superior Court.
  • Appeals from Superior Courts go to the Courts of Appeal for the appropriate district in which the lower court sits.
  • If a party loses in the appellate court, the losing party may petition the Supreme Court for review. The Supreme Court is the highest court in the California court system.
• Default – Failure of a party to respond to the pleading of the opposing party
• Remedies – When a party brings a civil action, the party must request some relief or remedy from the court. Remedies may be divided into two categories: legal and equitable.
  • The most common legal remedy is money damages.
  • Compensatory damages are all those damages that ‘‘compensate’’ the injured party, including damages that directly flow from the injury or breach.
  • Punitive damages, also called exemplary damages, are meant to ‘‘punish’’ the wrongdoer for his or her conduct. Such damages may be awarded in addition to the compensatory damages.
• Equitable Remedy
  • Relief requested from defendant that is usually designed to prevent some future harm.
• Key Ethical Guidelines
  • Keep confidential all client communications
  • Avoid all conflicts of interest
  • Do not communicate directly with an adverse party who is represented by counsel
  • Always identify yourself as a paralegal
• Privileged
  • Rules providing that certain communications are inadmissible because the communications are deemed confidential
• Conflict of Interest – When two or more parties with adverse interests are represented by the same counsel

*The material is taken from an online class.  This is not for sale.  Students struggling with paralegal class can use the information only for research and educational purposes.