Session 01 - Goods, Mixed/Hybrid Contracts, Offer

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A. Required Materials

• Textbook: 8th Edition (newly adopted this semester)
  • 7th edition acceptable if student has all cases briefed from 8th edition
  • If called upon and case is not available, student will be marked absent
• Horn Book: NOT required (Professor’s discretion - differs from other professors)
• Restatement Second of Contracts: NOT required (recommended but not mandatory)

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B. Attendance & Participation Requirements

1. Punctuality: Must be ready at 6:30 PM sharp
   • If called upon and not ready (e.g., opening laptop), marked absent
   • Emphasizes professional discipline required in legal practice
2. Zoom Requirements (State Bar mandate, not school discretion):
   • Full face must be clearly visible on camera at all times
   • Background must be non-distracting or blurred
   • No headsets (unless hearing impairment)
   • Must be muted when not speaking
3. Class Conduct:
   • No smoking, eating (noisy foods), talking to others, texting visible on phone
   • No cell phone use (keep on silent/airplane mode)
   • May audio record for personal use only - NEVER disseminate or post
   • No video recording or photographs at any time
4. Preparation Requirements:
   • Must brief all assigned cases
   • Must review questions/problems in assigned readings
   • If unprepared when called: get called next class; if still unprepared, receive half absence
   • Professor may require email submission of all case briefs if repeatedly unprepared

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C. Academic Integrity

• NO ChatGPT or AI tools for assignments
  • School can detect ChatGPT usage
  • Violation results in F grade or expulsion
  • Use AI for assistance only, never as final product
• No cheating - zero tolerance policy; can result in permanent law school blacklisting

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D. Reading Assignments

• Must read for each session regardless of whether previous session covered material
• If Session 1 cases not covered, still read Session 2 for next class
• Can attend other contract sections to make up absences (notify school)

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II. Introduction to Contracts Law

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A. What Law Governs Contracts?

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1. Common Law

• Governs ALL contracts EXCEPT sale of goods
• Based on case law/judicial precedent

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2. Uniform Commercial Code (UCC)

• Governs SALE OF GOODS only
• Model set of laws first adopted in 1950s
• Now adopted by all 50 states (including California)
• Only Article 2 tested on bar exam
• Key provision: UCC 2-207 (“Battle of the Forms”)

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B. Key Definitions

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1. Agreement (Restatement Second § 3)

• Definition: A manifestation of mutual assent sufficiently definite to conclude a bargain
• “Manifestation”: Expression (express or implied) of intent; outward communication
• “Mutual Assent”: Both parties agree
• “Sufficiently Definite”: Not 100% definite; major and essential terms agreed upon
• Important: Agreement ≠ Contract (not all agreements are enforceable)

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2. Contract

• Primary Definition: A promise or 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 Second § 1: A set of promises that the law will enforce
• Alternative Definition: Offer + Acceptance + Consideration
• Key Concept: An agreement between parties that the law will recognize and enforce

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C. Objective Theory of Contracts

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1. Core Principle (Lucy v. Zehmer case)

• Contract formation based on OBJECTIVE manifestations, not subjective intent
• What matters: What you actually said and did (outward manifestation)
• What doesn’t matter: What you thought in your head; being drunk/joking

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2. Application

• Court examines: Words, conduct, actions that would lead reasonable person to conclude agreement exists
• Cannot later claim “I was joking,” “I was drunk,” “I didn’t mean it”
• Intent judged by objective standards

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D. Mutual Assent Requirements

• Parties need NOT agree on everything
• Must agree on MAJOR and ESSENTIAL terms only
• Court may supplement or substitute minor missing terms (especially under UCC)
• Central Focus: Intent to be bound by contract terms
  • Intent is in the head but proven by outward manifestations
  • Intent is everything (similar to criminal law)

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III. Sale of Goods vs. Other Contracts

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A. What Are “Goods”? (UCC § 2-105)

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1. Definition

• All things that are MOVABLE and TANGIBLE at the time identified to be sold under contract
• Must be able to touch/feel the item
• Intangible items are NOT goods

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2. Special Cases: Real Estate-Related Items

• May fall under Article 2 (UCC) if:
  • Seller will sever from land, OR
  • Buyer will sever from land
• Examples: minerals, growing crops, uncut timber, fixtures removed from land

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3. What Are NOT Goods

• Real estate/buildings (not movable)
• Services (intangible)
• People (not “things”)
• Employment contracts
• Car leases (no sale/transfer of title)

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B. What Is “Sale”?

• Definition: Change of ownership; title passes from seller to buyer
• Lease/Rental: NOT a sale (no title transfer; only possession and use for time period)
• Must have BOTH: Sale AND Goods for UCC to apply

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IV. Mixed/Hybrid Contracts

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A. Definition

• Contracts involving BOTH common law elements AND UCC (goods) elements
• Example: Pizza delivery (goods = pizza; service = delivery)

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B. Severability Test

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1. When Promises Are Severable

• Definition: Contracts are severable when promises are INDEPENDENT and APPORTIONABLE

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2. Independent Promises

• Test: Parties’ intent evidences they would have contracted for promises separately
• Example: Car purchase + separate detail service contract with separate pricing

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3. Apportionable Promises

• Test: Promises can be allocated promise-to-promise
• Example: Gardening contract at $50/month for 12 months = 12 separate promises in one contract

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4. When Severable

• Apply appropriate law to each separate part
• Common law to service portions
• UCC to goods portions

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C. Predominant Purpose Rule (When NOT Severable)

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1. Application

• When elements cannot be severed, apply law based on predominant purpose
• Only ONE body of law applies (either common law OR UCC)

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2. Determining Predominant Purpose

• Look to the INTENT of the parties (especially the buyer)
• What did the buyer primarily want?
• Court examines: conduct, custom, circumstances, pricing allocation

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3. Examples

• Portrait painting: Service vs. end result? (Likely end result = goods)
• Photography: Photographer’s skill vs. photos? (Could be either)
• Apple Computer + AppleCare: Severable (separate pricing on receipt)
  • Computer = UCC (goods)
  • AppleCare = Common Law (service)

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V. Offer (Introduction)

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A. Definition of an Offer

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1. Intent to Be Bound

• Judged by objective theory of contracts
• Not subjective thoughts; outward manifestations matter

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2. Certain Definite Terms = Material Terms

a. Under Common Law

• Material terms = those necessary for court to:
  1. Determine if there was a breach, AND
  2. Create a remedy if breach occurred
• Examples: subject matter identification, parties’ identities, purchase price, etc.

b. Under UCC

• ONLY requirement: QUANTITY (and intent)
• Everything else filled in by “Gap Fillers”
  • Price
  • Time of delivery
  • Location of delivery
  • Time of payment
• Quantity cannot be gap-filled (court cannot determine remedy without knowing quantity)

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3. Communicated to the Offeree

• Must actually communicate offer to the intended recipient
• Cannot form contract based on uncommunicated intent

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B. Terminology

• Offeror: Person/entity who MAKES the offer (master of the offer)
• Offeree: Person/entity who RECEIVES the offer (NOT “accepts” - that comes later)
• Offeree must be designated person/entity with power to accept

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VI. Course Structure & Big Picture

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A. First Semester Topics (Formation)

1. What is a contract vs. what is not
2. What is enforceable vs. what is not
3. Offer:
   • What is/is not an offer
   • Is offer still valid at time of purported acceptance?
   • Can offer die, be revoked, lapse?
4. Acceptance:
   • Who can accept?
   • How can you accept?
   • What types of acceptance exist?
5. Consideration: The “glue” binding offer to acceptance
   • Exchange (“this for that”)
   • Can be mutual promises
6. Consideration Substitutes
7. Formation Defenses:
   • Capacity (e.g., minors - 12-year-old’s contract)
   • When contracts may/may not be enforceable

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B. Second Semester Topics (Performance & Breach)

1. Statute of Frauds (finally correctly placed first in 8th edition)
2. Can contract be enforced?
3. Breach analysis
4. Remedies
5. Conditions (challenging topic)
6. Performance defenses

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C. Key Concepts Introduced

• Promissory Estoppel: Can enforce promises even without formal contract
• Course uses case method to teach lawyering skills, not just black letter law
• Professor provides “spoon feeding” of black letter law to supplement casebook

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VII. Professional Practice Insights

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A. Importance of Discipline

• Punctuality critical in court (especially civil court - 3 minutes late can result in case dismissal/sanctions)
• Being prepared = professional requirement
• Parallels between classroom expectations and courtroom requirements

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B. Value of Legal Education

• Law degree = second most valuable license (after medical license)
• Opens doors beyond practicing law: law enforcement, corporate positions, etc.
• Changes how you think and read forever
• Best investment of time for earning capacity enhancement

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C. Teaching Philosophy

• Uses real-world examples from 27 years of practice
• Shares mistakes to help students avoid them
• “Spoon feeds” black letter law while casebook teaches lawyering
• Judges teaching at school = invaluable practical perspective
• Slow pace in beginning intentional (legal language is new; will accelerate later)

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VIII. Study Tips & Approach

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A. Reading Law

• Every word in legal definition matters
• Law school changes how you read forever
• Must read critically and precisely

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B. Case Briefing

• Brief all cases in assigned reading
• Cases in casebook already “briefed” from original (which can be 20+ pages)
• No canned briefs allowed
• May be required to email briefs if unprepared

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C. Big Picture Thinking

• Get “sky view” of each course
• Understand where each topic fits in overall structure
• Helps with planning and retention

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D. Questions Welcome

• Stop professor if definition unclear
• Ask for repetition - professor welcomes it
• Focus on your learning, not others’ opinions

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Key Takeaways for Studying:

1. Contract Formation = Offer + Acceptance + Consideration
2. Governing Law: Common Law (default) vs. UCC (sale of goods ONLY)
3. Objective Theory: Outward manifestations control, not subjective intent
4. Mixed Contracts: Sever if possible; if not, use predominant purpose test (intent-based)
5. Material Terms: Common law = many; UCC = quantity only
6. Intent is central to all contract analysis