10 Most Important Contracts Cases Every Law Student Must Know

The foundational case on consequential damages in contract law. Hadley established that damages must be foreseeable at the time of contracting -- either arising naturally from the breach or within the reasonable contemplation of both parties. Every contracts exam tests this rule.

The leading case on objective manifestation of assent. Lucy held that a contract written on a napkin in a bar was enforceable because a reasonable person would believe the offer was serious, regardless of subjective intent. This case defines the objective theory of contracts.

The classic consideration case. An uncle promised his nephew $5,000 if he refrained from drinking, smoking, and gambling until age 21. The court held that forbearance of a legal right constitutes valid consideration, even if the forbearance benefits the promisor.

A cornerstone case on unilateral contracts and offer and acceptance. The court held that using the smoke ball as directed constituted acceptance of the company's advertised reward offer. Carlill teaches the distinction between unilateral and bilateral contracts.

Known as the 'hairy hand' case, Hawkins is the foundational case on expectation damages. The court held that the proper measure of damages is the difference between what was promised and what was delivered, establishing the expectation interest as the default remedy in contract law.

The famous 'Peerless' case on mutual mistake. Both parties agreed to a shipment of cotton on a ship called Peerless, but each meant a different ship. The court held there was no binding contract because there was no meeting of the minds on a material term.

Judge Cardozo's landmark opinion on implied promises and consideration. The court found an implied obligation of reasonable efforts in an exclusive dealing agreement, saving the contract from being illusory. This case is central to understanding the UCC's duty of best efforts.

A key case on the choice between expectation, reliance, and restitution damages. A patient sued her plastic surgeon for a botched nose job. The court awarded reliance damages rather than expectation damages, illustrating how courts choose among the three damage interests.

The leading case on moral obligation and past consideration. A father promised to pay expenses incurred caring for his adult son, but the court held the promise unenforceable because past consideration is not valid consideration. A critical case for understanding the limits of promissory enforcement.

Judge Cardozo's famous decision on substantial performance and the measure of damages. A builder used a different brand of pipe than specified in a home construction contract. The court held that substantial performance satisfies the contract, and damages should be measured by difference in value, not cost of replacement.