Online Contract Formation

Online Contract Formation

Online Offers should include:

§ Remedies for Buyer.

§ Statute of Limitations.

§ What constitutes Buyer’s acceptance.

§ Method of Payment.

§ Seller’s Refund and Return Policies.

§ Disclaimers of Liability.

§ How Seller will Use Buyer’s Information (Privacy).

Dispute Settlement Provisions.

§ Choice of Law.

§ Choice of Forum.

§ E-Bay uses online dispute resolution.

Displaying the Offer (via hyperlink).

How Offer Will Be Accepted.

§ Amazon.com--Checkout.

§ “I Accept” Button to Click.

E-Contracts

E-Contracts

Introduction

Most courts find E-Contracts involve basic principles of contract law, applied in the online context.

Contract Provisions Limiting Remedies

Contract Provisions Limiting Remedies

Exculpatory clauses. 

§ Provisions stating that no damages can be recovered.

Limitation of liability clauses.

§ Provisions that affect the availability of certain remedies.

Waiver of Breach

Waiver of Breach

A pattern of conduct that waives a number of successive breaches will operate as a continued waiver.

Nonbreaching party can still recover damages, but contract is not terminated.

Nonbreaching party should give notice to the breaching party that full performance will be required in the future.

Election of Remedies

Election of Remedies

Doctrine created to prevent double recovery.

Nonbreaching party must choose which remedy to pursue.

UCC rejects election of remedies.

§ Cumulative in nature and include all the available remedies for breach of contract.

Recovery Based on Quasi Contract

Recovery Based on Quasi Contract

Equitable theory imposed by courts to obtain justice and prevent unjust enrichment.

Party seeking quantum meruit must show the following:

§ A benefit was conferred to the other party.

§ Party conferring did so with the reasonable  expectation of being paid.

§ The benefit was not volunteered.

§ Retaining benefit without paying for it would result in unjust enrichment of the party receiving the benefit.

Reformation

Reformation

Equitable remedy allowing a contract to be reformed, or rewritten to reflect the parties true intentions.

Available when an agreement is imperfectly expressed in writing.

Specific Performance

Specific Performance

Equitable remedy calling for the performance of the act promised in the contract.

Remedy in cases where the consideration is:

§ Unique (land);

§ Scarce; or

§ Not available remedy in contracts for personal services.

Rescission and Restitution

Rescission and Restitution

Rescission.

§ A remedy whereby a contract is canceled and the parties are restored to the original positions that they occupied prior to the transactions.

Restitution.

§ Both parties must return goods, property, or money previously conveyed.

Note: Rescission does not always call for restitution. Restitution is called for in some cases not involving rescission.

Liquidated Damages

Liquidated Damages

Liquidated Damages.

§ A contract provides a specific amount to be paid as damages in the event of future default or breach of contract.

Penalties.

§ Specify a certain amount to be paid in the event of a default or breach of contract and are designed to penalize the breaching party.

Case 17.3:   Green Park Inn v. Moore (2002).