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25 Cards in this Set
- Front
- Back
By agreeing to refrain from drinking booze,using tobacco, and playing billiards and cards for money until he turned 21,did grandson provide sufficient consideration to his grandfather? |
Hamer v. Sidway - Example of Consideration |
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- Invloves how much consideration is given - Measures whether bargain was fair - Typically not courts as long as consideration is legally sufficient |
Consideration: Adequacy |
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Agreements that Lack Consideration A remedy where a contract is cancelled and the parties are returned to the positions they occupied before contract was entered into. |
Rescission |
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Agreements that Lack Consideration Promises made in return for actions or events that have already take place are unenforceable |
Past Consideration - Bargained-For Exchange is missing |
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Agreements that lack consideration When promisor has not definitely promised to do anything even though it appears he or she has made a promise |
Illusory Promise - Like an Illusion |
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Settlement of Claims o Acommon means of settling a disputed claim, whereby a debtor offers to pay a lesseramount than creditor purports to be owed |
Accord and Satisfaction |
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Settlement of Claims Agreement under which one party promises to giveor perform, and the other party to accept, in satisfaction of a claim,something different from what the parties originally agreed |
Accord |
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Settlement of Claims Performance (usually payment) which takes place after the accord is executed |
Satisfaction |
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Settlement of Claims A Contract in which one party forfeits the right to pursue a legal claim against the other party. |
Release - Prohibits any further recovery beyond the terms stated in the release - Generally Binding if: Given in good faith, Stated in a signed writing, or accompanied by consideration |
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Doctrinethat can be used to enforced a promise when the promise has justifiably reliedon it and when justice will be better served by enforcing the promise
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Promissory Estoppel ("Detrimental Reliance") - Allows a party to recover on a promise even tho that promise was made without consideration. |
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Capacity required by the law for a party whoenters into a contract to be bound by that contract
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Contractual Capacity - Legal ability to enter into a contractual relationship - Intoxication - Mentally Incompetent Persons |
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Contract entered into by an intoxicated person might be voidable at that person's option; he/she must return all consideration received |
Intoxication |
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Contract made by mentally incompetent persons can be void, voidable, or valid |
mentally incompetent persons |
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If court has previously determined that a personis mentally incompetent and has appointed a guardian to represent the person,only guardian can enter into binding contract on that person’s behalf
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Void |
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§ If court hasn’t previously judged a personmentally incompetent AND the person didn’t know he was entering contract/didn’t have mental capacity to comprehend the contract (Only voidable bymentally incompetent; not other party)
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Voidable |
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If person was competent when contract was formed |
Valid |
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If the object or performance of a contract is rendered illegal by statute after the contract has been formed, the contract is considered to be discharged (made illegal) |
Contracts contrary to Statute |
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o Tobe enforced, contract must be formed for a legal purpose
o Contractto do something prohibited under federal or state statutory law is illegal,void and unenforceable from outset |
Legality |
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Charging an illegal rate of interest on a transaction. |
Usury - Gambling |
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- Contract not enforceable because of negative impact it would have on society - Contracts in restraint of trade - Covenant not to compete |
Contracts Contrary to Public Safety |
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Contractual promise of one party to refrain fromconducting business similar to that of another party for a certain period oftime and within a specified geographic area
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Covenant not to Compete |
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o Contractor clause that is void on basis of public policy because one party was forcedto accept terms that are unfairly burdensome and unfairly benefit strongerparty
-Proceduralunconscionability - Substantiveunconscionability |
Unconscionable |
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o Aclauses that releases a contractual party from liability in the event ofmonetary or physical injury, no matter who is at fault
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Exculpatory Clauses |
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- GeneralRule: Neither party to an illegal bargain can sue for breach and neither partycan recover for performance rendered - SeverableContract |
Effect of Illegality |
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Contract that is divisible because it consistsof distinct parts that can be performed separately, with separate considerationgiven for each party
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Severable Contract |