N.C.P.I.—Civil 501.02

NOTE WELL: Where the issue of whether a contract

was formed is not seriously contested, it may still be

advisable to give a portion of the formation charge

where, for example, the existence of an implied term of

the contract may be relevant to the next issue (e.g.,

breach of the implied term of good faith and fair

dealing).

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, that

the plaintiff and the defendant entered into a contract.

All of the evidence tends to show that the plaintiff and the

defendant entered into a contract.

I also instruct you that (select from among the following optional

provisions as applicable):

(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.)1

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

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

trade]2 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.]3

[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).]4

[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.]5

(UNIFORM COMMERCIAL CODE: 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].)6

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

term that the parties [have failed to include7] [have left open].8 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.9 "Good faith" means

honesty in fact in the [performance] [enforcement] of the

contract.10 (UNIFORM COMMERCIAL CODE: 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],11

"good faith" also means the observance of reasonable commercial

standards of fair dealing in the trade.)]12

[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.13 In

determining what constitutes a reasonable time,14 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 party15] [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.16 In determining what

constitutes reasonable notice, you may consider [the subject matter

and purpose of the proposed contract17] [the length of time the

parties should have reasonably expected their contractual

relationship to last 18] [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]19).

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 facts are as all the evidence tends to show, 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, even though there is no

evidence to the contrary, then it would be your duty to answer this issue

"No" in favor of the defendant.