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45 Cards in this Set
- Front
- Back
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What is a contract?
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An agreement that the court will enforce between two parties
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What are common law that govern contracts?
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Services, Real estate, Employment, and Insurance
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What are uniform commercial code(UCC) contracts?
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Sale and lease of goods
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What is an offeror and offeree?
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Offeror is the party making the offer.
Offeree is the party whom the offer is made |
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What is an Promisor and Promisee?
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Promisor is the person making the promise
Promisee is the person to whom the promise is made |
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What is a bilateral contract?
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If the offeree can accept simply by promising to perform.
Example: if the offeror says do you accept? and the offeree says I do. |
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What is a unilateral contract?
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If the offer is phrased so that the offeree can accept the offer only by completing the contract performance
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What is an express contract?
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The terms of the agreement are fully and explicitly stated in words, oral or written
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What is an implied contract?
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A contract that is implied from the conduct of the parties
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What is a Quasi contract?
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Fictional contracts that the courts can impose on the parties "as if" the parties had entered into an actual contract.
Are usually imposed to avoid unjust enrichment of one party at the expense of another. |
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What is a executed contract?
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A contract that has been fully performed on both sides
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What is a executory contract?
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A contract that has not been fully performed by the parties
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What is a valid contract?
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has the elements necessary to entitle at least one of the parties to enforce it in court
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What is a voidable contract?
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A valid contract but one that can be avoided at the option of one or both of the parties
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What is an unenforceable contract?
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One that cannot be enforced because of certain legal defenses against it
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What is a void contract?
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No contract at all.
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What is an offer?
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is a promise or commitment to do or refrain from doing some specified action in the future.
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What is the NOT offer intent?
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1. NOT obvious jest or anger
2. NOT later(future) has to be now 3. NO negotiations 4. CANNOT be a question 5. Ads are NOT considered offer intent 6. Auction is not an offer to form a contract |
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What is offer certainty?
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1. Both parties and the court can ascertain the terms of contract
2. Subject matter must be reasonably certain or definite 3. Price is needed |
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What is offer communication?
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The offer must be communicated to the offeree
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What are the termination of an offer?
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1. A revocation by the offeror
a. Except for option contract - is created when an offeror promises to hold an offer open for a specified period of time in return for a payment given by offeree 2. Rejection by offeree a. Offeree can counter offer which will reject the original offer in replace of a new one 3. Lapse time a. If the time is specified ex. 60 days b. If the time is reasonable by the court. 4. Destruction - offer is automatically terminated if the specific subject matter of the offer is destroyed before the offer is accepted 5. Death of offeror or offeree exception of an option contract |
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What are the acceptance of an offer?
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1. Unequivocal - accepted offer but party implies a counter offer
2. Unconditional - 3. Communication |
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What is forbearance?
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The refraining of action that one has a legal right to undertake
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What is consideration?
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1. something of legally sufficient value must be given in exchange for promise
2. Usually, there must be a bargained-for exchange Consideration has to be mutual |
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What is consideration detriment?
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Doing something not legally required.
Does not have to benefit someone Refrain from act legally permitted |
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Does adequacy or equality for consideration need to be required?
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No
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What is preexisting duty rule?
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An act that fulfills a preexisting duty cannot be consideration for a new contract.
Preexisting rule comes from 1. Statutes 2. Court order 3. Earlier contract exceptions: Unforeseen difficulties Good faith rescission |
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What is unforeseen difficulties & good faith rescission in earlier contracts?
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Exceptions to earlier contracts
1. Unforeseen difficulties: When something occurs that is extraordinary unforeseen that is found to be difficult to continue with contract 2. Good faith rescission: the unmaking of a contract so as to return the parties to the positions they occupied before the contract was made |
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What is past act? or Past consideration?
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Consideration for a new contract (not in the past)
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What is unliquidated debt?
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Debt is not settled, fixed, agreed on, ascertained or determined and reasonable persons may differ over the amount owed.
Agreements are binding |
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What is liquidated debt?
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One whose amount has been ascertained, fixed, agreed on, settled, or exactly determined
Agreements are not binding b/c of no consideration |
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What is promissory Estoppel? (also detrimental reliance)
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A person who has reasonably and substantially relied on the promise of another may be able to obtain some measure of recovery.
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What is a minor? Can the enter into a contract?
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A minor is under age 18
Yes they can enter into contracts |
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What is a primary rule for minor?
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A minor may disaffirm (get out of) a contract any time prior to age 18 (majority) or within a reasonably short time thereafter, but not after ratification.
(contract is voidable at the option of minor) |
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What is disaffirm?
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Words or acts indicating that the minor no longer wishes to be bound by contract. The minor must return whatever he/she is able
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What are the exceptions for minors?
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1. Misrepresented age
2. Marriage contract 3. Armed Services 4. Necessities - of reasonable value (not over priced) 5. Insurance contracts |
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Are parents liable for minors contracts or torts?
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No, unless they co-sign
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What is ratification for minors?
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Words or acts, after reaching 18 indicating that the former minor wishes to remain bound by the contract
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What is the primary rule for intoxicated person?
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The contract is voidable if the intoxicated person can disaffirm. However full restitution is required
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What is the legality on usury?
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State statutes limit the amount of interest that can be charged on debts (whether created by loan or by sale on credit). There are exceptions to the usury laws (credit cards; business to business loans)
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What is the legality on gambling?
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Illegal in several states. Defined as putting up consideration in a scheme to engage in a game of chance for the purpose of receiving a reward.
Gambling is risk-creating Insurance is risk-shifting Insurance which as long as the purchaser has in insurable interest in the life/property being insured |
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What is the licensing statutes?
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Designed to raise money - such as a city business license. Contracts with third parties are enforceable, even with out a license. (ex. contractor, plummer)
Designed to protect the public - such as a contractor's license, a license to a practice medicine, or a license to practice law. Contracts with third parties are void without a license |
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What is contracts in restraint of trade?
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Generally invalid as against public policy of allowing individual the freedom to pursue any trade or profession.
Exception: if restraint is reasonable (time/area) and is contained as a part of a "larger" contract, such as the sale of a business or an employment contract |
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What is Exculpatory clause?
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A provision in a contract under which either of two things is stipulated: (1) one party is relieved of any blame or liability arising from the other party's wrongdoing, or (2) one party (usually the one that drafted the agreement) is freed of all liability arising out of performance of that contract.
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What are the effect of illegality?
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1. Entire contract void - such as a contract to commit a crime
2. Main contract valid, but illegal portion invalid (severable contract) 3. Enforce illegal portion - member of protected class |
