Common Law Contracts: Are They Mutable?

Common law contracts are grounded in precedent, meaning rulings are often based on prior court decisions. This can lead to rigid interpretations, for example, a deviation from contract terms may lead to breach claims unless the substantial performance doctrine applies. Under common law, if an offer is changed, this constitutes a rejection and a counter-offer is considered a brand-new offer. However, if a contract is modified, the common law dictates that this requires consideration, i.e. something of value.

Common law contracts are grounded in precedent

Common law courts may emphasise equitable remedies in cases where strict enforcement would cause unfairness. Under common law, if an offer is changed, this constitutes a rejection and a counter-offer is considered a brand-new offer. This is because common law dictates that any change to an offer is a rejection and counter-offer, which creates a new offer and changes the person who was initially the offeree to the offeror.

Under common law rules, parties who wish to modify a contract will need to provide new consideration (i.e. something of value). For example, if a contract was originally created orally, but the modification would increase the value of the contract by $500 or more, then the parties must write down the new changes. Otherwise, those changes will not be considered legally valid or enforceable.

Common law contracts are different from UCC contracts, where a counter-offer can be considered part of the original offer and creates a binding contract depending on the specifics. Under the UCC, a contract can be modified without any additional consideration.

Common law courts may emphasise equitable remedies

Common law contracts are grounded in precedent, meaning rulings are often based on prior court decisions. This can lead to rigid interpretations, such as a deviation from contract terms being considered a breach of contract. However, common law courts can also consider the substantial performance doctrine, which allows for some flexibility in contract enforcement.

To modify a common law contract, parties must provide new consideration, or something of value. This is in contrast to UCC contracts, which do not require consideration for modifications. Under common law, any change to an offer is considered a rejection and counter-offer, creating a new offer and changing the offeree to the offeror. Oral modifications to a contract may also need to be put in writing if they increase the value of the contract by a certain amount.

Common law contract modifications require consideration

Under common law, a change to an offer is considered a rejection and counter-offer, creating a new offer and changing the person who was initially the offeree to the offeror. This is not the case under the UCC, where a counter-offer can be considered part of the original offer and may still form a binding contract depending on the circumstances.

Common law courts may emphasise equitable remedies in cases where strict enforcement would cause unfairness. For example, a deviation from contract terms may lead to breach claims unless the substantial performance doctrine applies. In addition, if a contract or modification is controlled by the SOF, any changes must be made in compliance with those rules. For instance, if a contract was originally created orally, but the modification would increase the value of the contract by $500 or more, the parties must write down the new changes for them to be legally valid or enforceable.

Common law contract modifications must be made in writing

It is important to note that any change to an offer is considered a rejection and counter-offer under common law. This creates a new offer and changes the person who was initially the offeree to the offeror. In contrast, the UCC allows a counter-offer to be considered part of the original offer and creates a binding contract depending on the specifics.

Additionally, unlike under the UCC, under common law, a contract may not be discharged due to impracticability. Eligibility to sue for breach of contract also differs between the UCC and common law. Under common law, privity of contract is required in order to litigate, but this is not the case under the UCC.

Common law contract modifications are different to UCC contract modifications

Firstly, under common law, any change to an offer is considered a rejection and counter-offer, which creates a new offer and changes the person who was initially the offeree to the offeror. In contrast, a change to an offer with the UCC may still form a binding contract depending on the circumstances surrounding the transaction and the substance of the differing term.

Secondly, under common law, any modification made to a contract requires consideration, which means that parties who wish to modify a contract will need to provide something of value. On the other hand, under the UCC, consideration is not a prerequisite for contract modification.

Thirdly, under common law, if a contract or modification is controlled by the SOF, then any changes must be made in compliance with those rules. For example, if a contract was originally created orally but the modification would increase the value of the contract by $500 or more, the parties must write down the new changes; otherwise, those changes will not be considered legally valid or enforceable.

Finally, common law courts may emphasise equitable remedies in cases where strict enforcement would cause unfairness. For instance, a deviation from contract terms may lead to breach claims unless the substantial performance doctrine applies. In contrast, if there is a breach of a UCC contract, the remedies available to the non-breaching party may differ from those available under common law.

Frequently asked questions