N.C.P.I.—Civil 501.01A

NOTE WELL: Use this instruction for a case in which

the Uniform Commercial Code applies. This instruction

supplements the language of N.C.P.I. 501.01 by

providing select provisions of the UCC. Not all UCC

provisions are included herein.

The (state number) issue reads:

“Did the plaintiff and the defendant enter into a contract?”

On this issue the burden of proof is on the plaintiff. This means

that the plaintiff must prove, by the greater weight of the evidence, two1

things:

First, that the plaintiff and the defendant mutually assented to the

same material terms2 for doing or refraining from doing a particular thing.

And Second, that the mutual assent of the parties was supported

by an adequate consideration.3

I will now explain to you the meaning of these two requirements.

With regard to the first requirement, for the parties to have

mutually assented, each of them must have agreed to the same material

terms for doing or refraining from doing a particular thing.4

Select from among the following optional provisions as applicable:

(Offer and Acceptance. An “offer” is an expression of willingness

to do or refrain from doing a particular thing. There is no requirement

that the offer be made in any particular form. It may be made orally, in

writing or by conduct which reasonably indicates the offering party's

intention5 to be bound if the other party accepts.6 An "acceptance" is an

expression of assent to the offer. [If the [offer does not specify]

[circumstances do not indicate] a particular method, manner or form of

acceptance, acceptance can be made in any manner and by any medium

reasonable under the circumstances.7 Acceptance may be oral,8 in writing9

or by conduct which reasonably signifies that the accepting party assents

to each material term of the offer.] [If the [offer specifies]

[circumstances unambiguously indicate] a particular method, manner or

form of acceptance, acceptance must be made in the method, manner or

form [specified] [indicated].10] [An order or offer to buy goods for

prompt or current shipment invites acceptance either by a prompt promise

to ship or a current shipment of conforming goods.11] [An order or offer

to buy goods for prompt or current shipment invites acceptance either by

a prompt promise to ship or a current shipment of non-conforming goods

with notice that they are being shipped as an accommodation to the

party making the order.12])

(Mutual Assent. Mutual assent occurs when an offer is

communicated by one party to the other, and the other party accepts the

offer.13 Mutual assent must be determined from the [written words]

[verbal expressions] [conduct] of the parties. Each party's [written

words] [verbal expressions] [conduct]14 must have such meaning as a

reasonable person would give under the same or similar circumstances.15

In determining what meaning a reasonable person would give to the

parties' [written words] [verbal expressions] [conduct], you should

consider the evidence as to all the circumstances existing at the time of

the [offer] [acceptance].)

(Intended, But Unexpressed Term. One party may intend for a

certain term to have a special or a particular meaning but fails to express

that meaning in his [written words] [verbal expressions] [conduct].

Under such circumstances, you should not consider such unexpressed

special or particular meaning. However, if you find, by the greater weight

of the evidence, that (name party) knew or should have known what

(name other party) meant by certain [written words] [verbal expression]

[conduct], that meaning is deemed assented to by (name party) unless

(name other party) knew or should have known that (name party) gave

such [written words] [verbal expressions] [conduct] a different

meaning.)16

(All Material Terms Agreed. For a contract to be complete, each

party must assent to all material terms. A material term is one that is

essential to the transaction, that is, a term which, if omitted or modified,

would cause one of the parties to withhold assent or to bargain for a

substantially different term. However, not every detail of the parties'

transaction need be agreed upon.17 It is sufficient that there be mutual

assent, express or implied, to all of the material terms.18 What

constitutes the material terms essential to a given contract depends on

the facts and circumstances of each transaction.19 In determining the

material terms, you may consider the following factors:

[the subject matter and purpose of the proposed contract]

[the intentions of the parties]

[the anticipated scope of performance by each party]

[the prior dealings of the parties under this or similar contracts]

[any custom, practice or usage so commonly known to other

reasonable persons, in similar situations, that the parties know or

should have known of its existence]

[state other factors supported by the evidence].)

(Supplemental Terms. In some instances, [the parties' course of

performance]20 [the parties' course of dealing] [an applicable usage of

trade]21 may give particular meaning to and supplement or qualify one or

more terms of the parties' contract.

[A course of performance arises out of prior repeated occasions for

one party to perform under the contract. When the other party knows

about the nature of such prior instances of performance and has an

opportunity to object to them but does not, you may consider such course

of performance as some evidence of the meaning of the parties'

contract.]22

[A course of dealing is a sequence of prior conduct between the

parties in transactions the same as or similar to the one at issue here

which reasonably establishes a basis for their common understanding of a

particular meaning of a term in their contract (or which supplements or

qualifies a term in their contract).]23

[A usage of trade is any practice or method of dealing having such

regularity of observance in a place, vocation or trade as to justify an

expectation that it will also be observed in the performance of the

contract in question.]24)

(The express terms of a contract and any [course of performance]

[course of dealing] [usage of trade] must be interpreted by you so as to

be consistent with each other whenever it is reasonable to do so.

However, where a consistent interpretation is not reasonably possible,

[express terms override [course of performance] [course of dealing]

[usage of trade]]

[course of performance overrides [course of dealing] [usage of

trade]]

[course of dealing overrides usage of trade].)25

(Implied Terms. In some instances, the law supplies a material

term that the parties [have failed to include26] [have left open].27 In the

matter before you,

[Good Faith. In every contract there is an implied covenant of good

faith and fair dealing that neither party will do anything which injures the

right of the other to receive the benefits of the agreement, and each

party is deemed to have agreed to act in good faith in [performing]

[enforcing] the contract.28 "Good faith" means honesty in fact in the

[performance] [enforcement] of the contract.29 (If a party [deals in

goods of the kind] [by his occupation holds himself out as having

knowledge or skill peculiar to the [practice] [goods involved in the

contract] [employs an [agent] [broker] [name other intermediary] who by

his occupation holds himself out as having knowledge or skill peculiar to

the [practice] [goods involved in the contract],30 "good faith" also means

the observance of reasonable commercial standards of fair dealing in the

trade.)]31

[Time for Performance. Where the parties did not expressly provide

a time for the performance of an act or the doing of a thing, the parties

are deemed to have agreed that the act may be performed or the thing

may be done within a reasonable time.32 In determining what

constitutes a reasonable time,33 you may consider [the subject matter

and purpose of the proposed contract] [the intentions and circumstances

of the parties] [the anticipated scope of performance by each party34] [the

parties' course of performance] [the parties' course of dealing] [any

applicable usage of trade] (state other factors supported by the

evidence).]

[Termination. Where the parties did not expressly provide a

duration for their contractual relationship, the parties are deemed to have

agreed that either of them may terminate their contract upon reasonable

notice to the other.35 In determining what constitutes reasonable notice,

you may consider [the subject matter and purpose of the proposed

contract36] [the length of time the parties should have reasonably

expected their contractual relationship to last37] [the parties' course of

performance] [the parties' course of dealing] [any applicable usage of

trade] (state other factors supported by the evidence).]

[State other applicable instances in which the law supplies omitted

material terms]38).

With regard to the second requirement that the mutual agreement

of the parties was supported by an adequate consideration,

"consideration" means something of value. Such value may consist of

some right, interest, profit or benefit accruing to one party or some

forbearance, burden, detriment, loss or responsibility given, suffered or

undertaken by the other.39 (An agreement based upon an exchange of

mutual promises is supported by adequate consideration40 if performance

of each of the promises would constitute adequate consideration.41) In

any event, the benefit to one party or the burden on the other party must

result from the bargain which causes the parties to enter into their

mutual agreement.42

(It is not necessary that the benefit flow to or that the burden fall

upon a party to the mutual agreement. [The benefit may flow to a third

person for whose benefit one of the parties bargained.43] [The burden

may likewise fall upon a third person who is to perform for the benefit of

one of the parties to the mutual agreement.44])

(Consideration is adequate unless it is so grossly inadequate45 that

it shocks the conscience. Consideration does not have to be proportional

to the benefit conferred or the burden undertaken, and even slight or

trifling consideration is adequate to support a mutual agreement

otherwise reached by mutual assent.46)

Finally, as to the (state number) issue on which the plaintiff has

the burden of proof, if you find by the greater weight of the evidence that

the plaintiff and the defendant entered into a contract, then it would be

your duty to answer this issue “Yes” in favor of the plaintiff.

If, on the other hand, you fail to so find, then it would be your duty

to answer this issue “No” in favor of the defendant.