Contract Law Cases Usa

Contract Law Cases in the USA: A Comprehensive Guide

Contract law is an ever-evolving field that governs the creation, interpretation, and enforcement of agreements between parties. In the United States, contract law is predominantly based on common law principles, which have been developed through the rulings of courts in various contract law cases. This article will provide a comprehensive guide to some of the most significant contract law cases in the USA.

1. Henningsen v. Bloomfield Motors, Inc. (1960)

This landmark contract law case concerned a woman named plaintiff Henningsen who purchased a car from defendant Bloomfield Motors. After the car`s brakes failed, Henningsen discovered that the contract she had signed included a clause that absolved the dealer of liability for any personal injury that might result from the car`s defects. The New Jersey Supreme Court ruled that such clauses constituted an unconscionable contract, and therefore, unenforceable.

2. Wood v. Lucy, Lady Duff-Gordon (1917)

In this case, Miss Duff-Gordon, a well-known fashion designer, had signed a contract with Mr. Wood, a marketer, who was to promote her designs. The contract provided that Wood was to have the exclusive right to market and license Duff-Gordon`s designs in return for a 50% commission. However, Duff-Gordon later entered into another contract with a competitor. Wood sued her for breach of contract, and the case went to the New York Court of Appeals. The court held that the contract was not enforceable because it lacked mutual consideration.

3. Hamer v. Sidway (1891)

This case concerned a contract between an uncle and his nephew in which the uncle promised the nephew a sum of money if he abstained from drinking, using tobacco, swearing, and playing cards or billiards for money. The nephew fulfilled his part of the contract, but the uncle refused to pay the money. The Supreme Court of New York held that the nephew had provided consideration in abstaining from vices, and therefore, the uncle was obligated to pay him.

4. United States v. Winstar Corp. (1996)

This case involved the savings and loan industry in the USA and its relation to the government. The Winstar Corporation, along with other thrift institutions, had entered into agreements with the government to aid in the restructuring of the industry. The agreements promised financial assistance in exchange for the thrift institutions` assumption of additional liabilities. However, the government later reneged on its promise, leading to the collapse of many thrift institutions. The Supreme Court held that the agreements constituted contracts, and therefore, the government was liable for their breach.

5. Lucy v. Zehmer (1954)

In this case, the plaintiffs, Mr. and Mrs. Lucy, had made an offer to purchase a farm from Mr. and Mrs. Zehmer for $50,000. The Zehmers initially refused the offer, but after a night of drinking, they signed a contract on a napkin that stated, “We hereby sell to W.O. Lucy the Ferguson Farm complete for $50,000.” The Zehmers contended that they had been joking and had not intended to sell the farm. However, the Supreme Court of Virginia held that the contract was enforceable because it met the requirements of a legally binding contract.

Conclusion

The above contract law cases demonstrate the various issues that can arise in the context of contract law. From unconscionable clauses to mutual consideration, these cases provide a comprehensive overview of the principles that underpin the field of contract law in the United States. As such, they are a valuable resource for anyone seeking to understand the legal landscape of contract law in the USA.