2.  List the things you think you would need to create a valid contract.  Describe a contract that you have been in, or one that you have heard about. What made it a contract?

3.  Offer: Showing a willingness to enter into a bargain in such a way that another person would interpret that they could accept and it would conclude the negotiations.  Can be through words or actions.

4.  Advertisements can be offers but are usually an offer to negotiate.  Negotiations are not offers. Buyers have to be able to walk away from estimates or price quotes.

5.  Target places an Ad in the Tribune that states: “5 bags of Halloween candy for $10.” Is this an offer?  Your shady friend says he will sell you 5 open bags of candy he found for $5. Is this an offer?

6.  Nicki Minaj is driving with Drake in her pink Bentley. Frustrated that the car is shifting slowly she exclaims, “I am sick of this car and want to get rid of it.” Drake says he will take the car. Did Nicki make an offer?

7.  Nicki Minaj is driving with Drake in her pink Bentley. Frustrated that the car is shifting slowly she exclaims, “I am sick of this car and will sell it to you for $200,000.” Drake says he will take the car. Did Nicki make an offer?

8.  Acceptance- once an offer has been made, the other party can accept the offer in any reasonable way, including starting performance (what does that mean?).  The party who accepts can back out up until performance begins.  Factors include:  Were terms finalized? Did performance begin?

9.  Jacob picks out a shirt with a $30 price tag at the mall. He takes the shirt to the counter to pay. Was their offer and acceptance?  Ms. Blackburn offers Jacobsen & Sons $50 to paint her porch. Jacobsen & Sons paints the porch then comes asking for payment. Was there offer and acceptance?

10.  Jill publishes an ad seeking to sell her yarn collection. When Sally comes to purchase the collection, Jill does not like how Sally acts and declines to sell the yarn to Sally. Was there offer and acceptance?  Nicki Minaj says she wants to sell her pink Bentley for $200,000. Drake says, “I like that car a lot and that is a good price.” Was there acceptance?

11.  Consideration: A contract must include a promise and a return promise.  It cannot only go in one direction. Both parties have to get something valuable (a good or service).  A promise of a gift is not enforceable because one party gets nothing.  The exchange doesn’t have to be equal- one person may value something more than someone else.

13.  Substantial Performance- Doing exactly what is in the contract is not always possible, but the parties have to reasonably live up to the terms.  If one party does not materially perform, the other party no longer has to perform.  Failure to perform is called “breach.”

14.  What happens when one party breaches?  Damages- The party who is harmed can request money from the other party equal to the loss from the breach.  Specific performance- If it is still possible to perform the contract, the court can require the party to perform.

15.  Think-Pair-Share  Read the fact pattern on your work sheet to yourself, then spend about 3 minutes explaining whether you think one party breached the contract, and what the court should do, if anything.  Then, you will share with your group for about 5 minutes.

16.  Hawkins v. McGee- The court said that you can recover damages for the difference between what you expected to get in the contract and what you actually got.  In this case, Sam would be able to recover the difference in value between a good hand and a hairy hand.  Doctors and lawyers would work together to determine that value.

17.  Certain things can make contracts void even though both parties agreed on the terms and there was valuable consideration.  Unconscionability- If one party tricked another party into agreeing to an unfair contract, the court may not enforce it.  Often comes up when businesses try to trick poor or uneducated clients.

18.  Fraud or Duress- Lying or misrepresenting something in negotiations can make a contract void.  Also, taking advantage of someone in a bad situation can make a contract void.  If a company knows about a flaw in a product and covers it up, the contract to buy it is void.

19.  Criminality/Public Policy- If the terms of a contract require illegal behavior, or if they go against Congress’ stated goals, it will be declared void.

20.  Practice- Have one member of your table read the following facts out loud, then discuss whether the contract should be declared void for any of the reasons discussed above. 5 minutes.  Discuss the issues, but you are not required to write them down. We will hear each group’s opinion at the end of 5 minutes.