Business Law Chapter 14

Front 1

Statute of frauds

Back 1

A state statute that requires certain types of contract to be in writing.

Front 2

Which contracts have to be in writing?

Back 2

Real estate property
Contracts that cannot possibly be performed in one year.
Collateral contracts in which a person promises to answer for the debt of another.
Promises made in consideration of marriage.
Contracts for sale of goods over 500.
Agents contracts where the underlying contract must be in writing.
wills.
Bankruptcy charges.

Front 3

Executory contract

Back 3

Cntract that is not in writing even though the statute of frauds requires it and is unenforceable by either party.

Front 4

Real property

Back 4

The land itself, as well as the buildings, trees, soil, minerals, timber, plants, crops, fixtures, and other things permanently affixed to the land or buildings.

Front 5

Mortgage

Back 5

An interest in real property given to a lender as security for the repayment of a loan.

Front 6

lease

Back 6

The transfer of the right to use real property for a specified period of time.

Front 7

Life estate

Back 7

An interest in real property for a person's lifetime; upon that person's death, the interest will be transferred to another party.

Front 8

Easement

Back 8

A right to use someone else's land without owning or leasing.

Front 9

One-year rule

Back 9

A rule which states that an executory contract that cannot be performed by its own terms within one year of its formation must be in writing.

Front 10

Guaranty contract

Back 10

A promise in which one person agrees to answer for the debts or duties of another person. It is a contract between the guarantor and the original creditor.

Front 11

Guarantor

Back 11

A person who agrees to pay a debt if the primary debtor does not.

Front 12

Main purpose exception.

Back 12

An exception to the statute of frauds which states that if the main purpose of a transaction and an oral collateral contract is to provide pecuniary benefit to the guarantor, the collateral contract does not have to be in writing to be enforced.

Front 13

UCC statute of fraudds Section 2

Back 13

A section of thte UCC which states that the sales contracts for the sale of goods costing $500 or more must be in writing.

Front 14

UCC Statute of frauds section 2A

Back 14

A section of the UCC which states that lease contracts involving payments of $1000 or more must be in writing.

Front 15

Equal dignity rule

Back 15

A rule which says that agents' contracts to sell property covered by the STatute of Frauds must be in writing to be enforceable.

Front 16

Part performance

Back 16

An equitable doctrine that allows the court to order an oral contract for the sale of land or transfer of another interest in real property to be specifically performed if it has been partially performed and performance is necessary to avoid injustice.

Front 17

Formality of the writing

Back 17

Must have signiture, if there is several writings you can integrate them or reference them, interpretation of words is also important

Front 18

Integration of several writings

Back 18

The combination of several writings to form a single contract

Front 19

incorporation by reference

Back 19

Integration made by express refernece in one document that refers to and incorporates another document within it.

Front 20

Standards of interpretation for contracts:

Back 20

Ordinary words are givin their usual meaning according to the dictionary.
Technical words are given their technical meaning, unless a different meaning is clearly intended.
Specific terms are presumed to qualify general term.
If both parties are part of the same trade then the meaning will be that which is used in the trade unless otherwise specialized.
Typed words prevail over preprinted words, handwritten prevail over both preprinted and typed.
If there is ambiguity, it will be resolved against thte party who drafted the contract.

Front 21

Parol evidence

Back 21

Any oral or written words outside the four corners of a written contract.

Front 22

Parol evidence rule

Back 22

A rule that says if a written contract is a complete and final statement of the parties' agreement, any prior or contemporaneous oral or written statements that alter, contradict, or are in addition to the terms of the written contract are inadmissible in court regarding a dispute over the contract. There are several exceptions to this rule.

Front 23

Merger clause

Back 23

A clause in the contract that stipulateds that it is a complete integration and the exclusive expression of the parties' agreement.

Front 24

Promissory estoppel

Back 24

An equitable doctrine that permits enforcement of oral contracts that should have been in writing it is also applied to avoid injustice.

Front 25

Exceptions to the parole evidence rule

Back 25

Shows that a contract is void or voidable due to fraud misrepresentatioon, duress, or undue influence.)
Explains ambiguous language.
Concerns a prior course of dealing or performance by the parties.
Fills in gaps to the contract.
Corrects an obvious clerical or typographical error.

Front 26

Can use an oral promise if three conditions are met:

Back 26

1. The promise induces action .
2. The reliance on the oral promise was foreseeable.
3. Injustice can not be avoided unless the promise is enforced.