Omitted and implied terms - Next Generation Bar Exam

1. At common law, what is the general effect of an agreement to agree on an essential term later?

   It is unenforceable for indefiniteness, unless the court can supply the term or the parties intended to be bound. The UCC is more permissive for open price terms in sales of goods.

2. A sales contract does not state a place of delivery, and both parties know the goods are stored in a third party's warehouse. Where is delivery due?

   At the warehouse where the goods are located. When identified goods are known by both parties to be elsewhere, that location is the place of delivery.

3. Under UCC 2-309, how long does a contract for successive performances last when it specifies no duration?

   A reasonable time, terminable by either party on reasonable notice. Notice of termination protects the other party from sudden loss of an ongoing relationship.

4. Under UCC 2-308, where is delivery made when the contract does not specify a place?

   At the seller's place of business, or its residence if it has none. If both parties know the goods are elsewhere, delivery is at the place where the goods are located.

5. When parties omit an essential term, how does a court supply it under the Restatement (Second)?

   By supplying a term that is reasonable in the circumstances. Courts fill gaps rather than declaring the contract unenforceable when the parties intended to be bound.

6. Under UCC 2-310, when is payment due when the contract does not say?

   At the time and place the buyer receives the goods. Payment and delivery are treated as concurrent unless the parties agree to credit.

7. Under UCC 2-305, what price governs when the parties intended to contract but did not settle the price?

   A reasonable price at the time for delivery. The rule applies when the price is left open, is to be agreed later, or is to be set by a standard that fails.

8. Under UCC 2-309, when must delivery be made when the contract specifies no time?

   Within a reasonable time. What is reasonable depends on the nature of the goods and the circumstances of the transaction.

9. Under UCC 2-305, what standard applies when the contract lets one party fix the price?

   The party must fix the price in good faith. A price set arbitrarily or to exploit the other party violates the good-faith requirement.

10. When does a contract fail for indefiniteness?

    When its terms do not provide a basis for determining whether a breach occurred and what remedy is appropriate. The more terms the parties leave open, the less likely they intended a binding contract.

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