Def. of Contract
Restatement § 1: A contract is 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.
Def. of Promise
Restatement § 2: (1) A promise is a manifestation of intention to act or refrain from acting in a specified way, so made to justify a promisee in understanding that a commitment has been made
How a promise may be made
Restatement § 4: A promise may be stated in words either oral or written, or may be inferred wholly or partly from conduct.
Requirements of a Bargain (Mutual Assent)
Restatement § 17 Requirement of a Bargain: (1) Except as stated in Subsection (2), the formation of a contract requires a bargain in which there is a manifestation of mutual assent to the exchange and a consideration.
Mode of Assent: Offer and Acceptance
Restatement § 22
(1)The manifestation of mutual assent to an exchange orinarily takes the form of an offer or proposal by one party followed by an acceptance by the other party or parties.
(2) A manifestation of mutual assent may be made even though neither offer nor acceptance can be identified and even though the moment of formation cannot be determined
Def. of Offer
Restatement § 24: An offer is the manifestation of willingness to enter into a bargain, so made as to justify another person in understanding that his assent to that bargain is invite and will conclude it.
Restatement § 25: An option contract is a promise which meets the requirements for the formation of a contract and limits the promiosor's power to revoke an offer
Option Contract Created by Part Performance or Tender
Restatement § 45:
(1) Where an offer invites an offeree to accept by rendering a performance and does not invite a promissory acceptance, an option contract is created when the offeree tenders or begins the invited performance or tenders a beginning of it
(2) The offeror's duty of performance under any option contract so created is conditional on completion or tender of the invited performance in accordance with the terms of the offer
(1) To constitute consideration, a performance or a return promise must be bargained for.
(2)A performance or return promise is bargained for if it is sought by the promisor in exchange for his promise and is given by the promisee in exhchange for that promise.
(3)The performance may consist of
a. an act other than a promise, or
b. a forebearance, or
c. the creation, modification, or destruction of a legal relation.
(4) The performance or return promise may be given to the promisor or to some other person. It may be given by the promisee or by some other person.
Promise for Benefit Received
Restatement § 86:
A promise made in recognition of a benefit previously received by the promisor from the promisee if binding to the extent necessary to prevent injustice.
A promise is not binding under Subsection (1)
a. if the promisee conferred the benefit as a gift or for other reasons the promisor has not been unjustly enrich
b. to the extent that its value is disproportionate to the benefit.
Notes: The requirement of consideration is designed in part to prevent people from making promised on the spur of the moment—promises they do not really mean to make and therefore should not be forced to honor (the "cautionary" function of consideration")
(1) An offer is binding as an option contract if it
(a) is in writing and signed by the offeror, recites a purported consideration for the making of the offer, and proposes an exchange on fair terms within a reasonable time,; or
(b) is made irrevocable by statute.
(2) An offer which the offeror should reasonably expect to induce action or forbearance of a substantial character on the part of the offeree before acceptance and which does induce such action or forbearance is binding as an option contract to the extent necessary to avoid injustice.
Promise Reasonably Inducing Action or Forbearance
Restatement § 90:
(1)A promise which the promisor should reasonably expect to induce action or forbearance on the part of the promisee or a third person and which does induce such action or forbearance is binding if injustice can be avoided only by enforcement of the promise. The remedy granted for breach may be limited as justice requires.
(2) A charitable subscription or a marriage settlement is binding under Subsection (1) without proof that the promise induced action or forbearance.