Contract Laws

Front 1

Contract

Back 1

predictibility on what is going to happen

Front 2

Agreement

Back 2

whre both parties have agrees to do something

Front 3

Offer

Back 3

Invitation by 1 party to enter into a contract

Front 4

5 requirements for a valid contract

Back 4

1. Mutual Agreement
2. Consideration
3. Capacity
4. Legality
5. Formal Requirements

Front 5

mutual agreement

Back 5

offer -- the offeror -- makes the offer
- decide what is going to be in the offer/the master
- can either 1) accept 2) reject 3) hold open

Front 6

Consideration

Back 6

what each party gives up for a valid contract.
- price a person pays for contract
- both parties must give up something

Front 7

Capacity

Back 7

only certain people can enter in a contract.
- cannot be a 1) minor 2) impaired 3) mentally challenged

Front 8

Legality

Back 8

cannot make contract to buy illegal substances, to gamble, or that violated usery laws (intrest)

Front 9

Formal requirements

Back 9

writing requirements
- some contracts must be in writing, if not the court will not enforce it.

Front 10

Categories of contracts

Back 10

1) Valid -- all 5 are met -- enforceable in court (can sue on it)
2) Void -- neither party may enforce (legality issues)
3) Voidable -- typically take place with capacity
a. Enforceable under the descression of the weaker party (minor, impaired, handicapped)

Front 11

mutual agreement
Unilateral

Back 11

only one promise; seeks performance

Front 12

mutual agreement
Bilateral

Back 12

2 promises between o/or and o/ee
- i will give you this in exchange for this

Front 13

Expressed contract

Back 13

both parties know all terms of contract upfront
- you will cut my grass for $50 once a week for 12 weeks

Front 14

Implied Contract

Back 14

intended to keep agreement going
-you keep coming after 12 weeks -- just on going

Front 15

Executory

Back 15

pending -- not been done yet
-one party has not fulfilled agreement

Front 16

Executed

Back 16

done -- all have been done

Front 17

Mirror Image Rule

Back 17

unilateral
no counter offers
all terms of agreement must be met with the same answer

Front 18

In order for an offer to be valid

Back 18

1) must be serious when making offer
2) terms of offer must be deffinate
3) the offer has to be presented/communicated to intended o/ee

Front 19

termination of offers
Rejection

Back 19

including counter offer
must be mirror image rule

Front 20

termination of offers
Revocation

Back 20

the o/or can change mind if it "in hold"
- if timeline by o/ee is put then o/or does not have to follow
-if money put down -- go to valid option contract

Front 21

termination of offers
Expires

Back 21

goes over timeline

Front 22

termination of offers
terminated of subject matter is destroyed

Back 22

may be due to weather damage ect.

Front 23

termination of offers
Death of o/or

Back 23

only exception -- valid option contract

Front 24

Consideration
Benefit/Detriment theory

Back 24

- receive a benefit
- both must give up something

Front 25

Consideration
Bargained for Exchange theory

Back 25

both parties of agreement must want what they are seeking.
- no handouts

Front 26

Not Consideration
Past Performance

Back 26

contract made because something in the past.
- batman example -- saved my life

Front 27

Not Consideration
Preexisting duty to act

Back 27

lease example
a landlord does not have to give benefits to pay the rent on time, you are already obligated to pay the rent on time.

Front 28

Not consideration
No Legal Right

Back 28

under 21 and drink, no contract because if you are under 21 you do not have the legal right to drink

Front 29

Valid Option Contract

Back 29

Agreement where one party is given time to hold offer open -- buying time

Front 30

Capacity and Concent

Back 30

Voidable Issues with:
minors, mentally handy capped, impaired or intoxicated

Front 31

capacity and consent
Disaffirm

Back 31

under age you can get your money back
- has to give back restitution to the car

Front 32

capacity and consent
necessary

Back 32

(clothing food, shelter) if a minor enters into a contract they an still get out of the contract but must pay the reasonable value for the item

Front 33

capacity and consent
ratify

Back 33

agreeing to be bound to terms of contract
- 3-6 months after 18 one must decide if she wants to be bound to contract or she will auto- ratify

Front 34

capacity and consent
voidable

Back 34

Fraud -- intending to induce the other party to contract, knowing the words are false or uncertain they are true
Duress -- force -- either you name or you bargain

Front 35

Capacity and consent
Under influence

Back 35

Ministers, attorneys, children/parents
-one of the parties can manipulate mind of another -- you cannot do that

Front 36

Legality

Back 36

Void
courts will not enforce if an illegal thing is involved (weed)

Front 37

Legality
Subject matter that is illegal by statute cannot make a contract valid

Back 37

1) Criminal Acts
2) Gambling
3) Usury/Usurious -- interest - charge s more interest than statute allows -- cash now
4) Insurance -- if you have a reason you can take out a life policy (business partners)
5) Sunday contracts -- businesses, alcohol

Front 38

Legality
Restraint of trade -- non competition clause

Back 38

prohibit people to get jobs
- you cannot work with competition
- will be enforced if
1) trade secret (coke)
2) Confidential info (stock broker)
3) Client Lists
If does not deal with above -- must be drawn narrowly.

Front 39

Legality
Narrowly Draw

Back 39

1) reasonable period of time
2) reasonable manner
3) reasonable geographical scope

Front 40

Legality
Public Policy

Back 40

Broad subject protecting what is traditionally right
1) in favor of marriage

Front 41

Formal Requirements
Statute of Frauds

Back 41

Void
Requires some contracts to be in writing

Front 42

Formal Requirements
What must be in writing

Back 42

1) Estate in land (purchase, lease)
2) contract for longer than 1 year (exception -- having to do with a persons life)
3) contract that would pay debt for another contract
4) Executory pays debt of estate
5) contract in consideration of marriage -- Dowry
6) Universal Commercial Code (UCC) -- sale of goods over with a value of $500 or more

Front 43

Formal Requirements
What has to be written

Back 43

lawyer does not have to be present and can be written on anything.
1) signed by at least 1 party -- to be charged
2) must contain relevant terms
- name of each party
- subject matter
- all essential terms and promises