Contracts and Sales Multistate Bar Practice Exam

Under what circumstances will a court supply missing terms in a contract?

1. If the parties never intended to form a contract

2. If it is clear that parties meant to form a contract with reasonable certainty for remedy.

3. If both parties are in a dispute

4. If there is a signed agreement without specified terms

The correct answer is: If it is clear that parties meant to form a contract with reasonable certainty for remedy.

A court will supply missing terms in a contract when it is evident that the parties intended to form a contract and that their agreement can be determined with reasonable certainty. This principle is rooted in the contract law doctrine that aims to honor the intentions of the parties involved. The court seeks to fill in gaps only when there is sufficient evidence to conclude that the parties had a clear intent to create a binding agreement, understanding the essential terms involved, such as price or quantity, even if those terms were not expressly stated in the contract draft. In instances where the intention to contract is ambiguous or nonexistent, as noted in the first choice, there would be no basis for judicial intervention since the foundational element of a contract—mutual assent—would be lacking. For disputes between the parties, while courts may get involved to resolve the issues, simply being in dispute does not justify filling in missing terms without a clear understanding of the parties' intentions. Lastly, a signed agreement without specified terms may indicate an intention to agree; however, the enforceability or the capacity for a court to fill in the gaps heavily relies on demonstrating that the essential terms can be supplied based on the surrounding circumstances and the parties' conduct leading up to the agreement. Therefore, the key factor for a