Law Test 2

Front 1

Four Requirements of a valid contract

Back 1

-Agreement (offer and acceptance)
-Consideration (something of value recieved or rpomised)
-Contractual Capacity (legally able)
-Legality (goal to be accomplished is legal)

Front 2

Explain the two defenses to the enforcability of a contract

-Voluntary Consent
-Form

Back 2

VC-both parties must voluntarily agree and cannot be based on fraud, undue influence, mistake or duress
Form-must be in the for law requires

Front 3

FORMATION CLASSIFATION

Explain Bilateral vs Unilateral

Back 3

depends on what the offeree must do to accept and bind the offerer to the contract
B- Promise for promise (made when promises are exchanged)
U-"promise for act" (made when contract is performed)

Front 4

Common law governs all contracts except when it has been modified or replaced by...

Examples under common law?

Back 4

staturoty law (UCC) or administrative agency regulations
Ex) services, real estate, employment, and instuance

Ex under UCC) sale and lease of goods

Front 5

functions of common law (3)

Back 5

-provide certainity, stability, and predictibility
-Pacts sunt servana (agreements shall be kept)
-essential for market economy

Front 6

What is a contract?

Back 6

a legally binding agreements between two or more parties who agree to perform or refrain from performing some act now or in the future (usually future)

Front 7

What is the objective theory of contracts?

3 objective facts?

Back 7

a parties intentions to enter into a contract is judged by outward, objective facts as interpreted by a reasonable person. Not from the secret, personal, subjective facts of the party.
-what the party said, how the part acted, circumstances surrounding transaction

Front 8

FORMATION CLASSIFICATION

Explain Formal vs. Informal

Back 8

Formal- required to be put in a special form (Negotiable instruments- checks, drafts, promissory notes, cirtificates of deposit, letters of credit, bills of lading)
Informal- no form required, based on substance, not form.

Front 9

FORMATION CLASSIFICATION

Expressed vs. Implied

(3 requirements for implied)

Back 9

Expressed- terms fully stated in words oral or written
Implied (-in-fact)- based on conduct or behavior
-plaintiff furnished some service or property
-plaintiff expected to be pain and defendant knew payment was expected
-defendent had oportunity to reject it

Front 10

PERFORMANCE CLASSIFICATION

Executed vs. Executory

Back 10

Executed- both parties completed promise
Exectory- not completed

Front 11

ENFORCABILITY CLASSIFICATION
-voidable?
-void?
-unenforcable?

Back 11

voidable- party has the option to enforce or avoid the contractual oblgation
Void- no contract exists: does not fulfill 4 contract requirements
Unenforcable- certain legal defenses against it

Front 12

What is a quasi contract?

Back 12

not a true contract because it did not arise out of agreement. Fictional contract that courts can impose "as if" parties have entered a real contract

-cannot be used with real contract

Front 13

To recover a Quantum Meruit in quasi contract case

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If plaintiff proved acceptance of services & value of those services they can bring a claim of quantum meruit to the courts

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What is the Plain meaning rule?

Back 14

meaning is determined by thte face of th3e instrument (written contract alone)

Only when wording is ambigious and unclear can extrinsic evidence be used

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eight interpretation rules

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1.reasonable, effective, and lawful meaning to terms 2. interpreted as a whole 3. written words more credit. 4. terms that were subject of seperate negotation will be given greater consideration 5. ordinary or technical meaning applied 6. specific wording will be given more consideration 7. party who uses unclear words are liable 8. evidence of conditions can be used to clairfy

Front 16

three requirements for an offer to be accepted

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1. serious intentions
2. Terms must be certain and definite
3. communicated to the offeree

Front 17

6 instances that are considered NOT offers based on the serious intentions requirement

Back 17

1.Expression of opinion2. statements of future intent 3.preliminary negotations 4.Advertisments(unless a reward is offered) 5. Auctions (only bidder makes offers. w/ reserve means you can revoke) 6. Agreements to agree (only binidng if clear there was intent to be bound)

Front 18

Under the requirement of definate terms of acceptance name four things that must be included.

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1. identify parties
2. Indentify subject & work to be done
3. identify consideration to be paid
4. Time of performance

Front 19

Three ways an offer can be terminated by the parties involved.

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1. Revocation-must be communicated and is only effective when offeree comes aware. (can't in option contracts)
2.Rejection- only valid when offeror becomes aware
3. due to "mirror image rule" the offer is terminated if anything changes

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Four ways an offer can be terminated by operation of law

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1. lapse of time
2. destruction of subject matter
3. Death of incompetence of offeror or offeree
4. supervening illegality of contract

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Acceptance must be ____ & ______.

Back 21

Unequivocal and communicated

Front 22

What is the mailbox rule?

Back 22

offer complete when the acceptance is dispatched, not when delivered.

-if delivered by means not expressed, it is only vaild when recieved.

Front 23

Four things an on-line offer must include

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1. Acceptance of terms
2. Payment
3. Return policy
4. Disclaimer

Front 24

What are two elements of consideration?

Back 24

1. Something of legally sufficient value must be given in exchange for the promise
2. There must be a bargained for exchange

Front 25

3 things that legally sufficient value may consist of:

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1. a promise to do something that one has no prior legal obligation to do
2. performance of an action that you are otherwise not obligated to do.
3. Forbearance- refraining from an action one has a legal right to undertake

Front 26

Explain the term Bargained for Exchange

Back 26

Differentiates contracts from gifts, as there should be something of legal value given in exchange for the promise

Front 27

What is Adquacy of consideration?

Back 27

concerns fairness of the bargain. A court will not solely consider adquacy, however is adquacy is nonexistant, then they will question if concent was voluntary.

Front 28

Three agreements that people think qualify as consideration, but do not.

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1. Preexisting duty (exception when it comes to unforseen difficulties, recession, and new contract)
2. Past consideratioon
3. Illusionary promises

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Explain accord and Satisfaction

Back 29

When the debtor offers to pay and creditor accepts less than the amount they say they owe.

--> a debt must be in dispute for these both to occur

Front 30

What is a release?

This is binding if?

Back 30

Where one party forfeits the right to persue a legal claim against the other

Given in good faith/stated in signed writing/accompanied by consideration

Front 31

Explain liquated debt dispute vs. Unliquated debt dispute

Back 31

L-exactly determined (accord and satisfaction cannot take place)

U- not exactly determined

Front 32

What is a convenant not to sue?

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It is an agreement where parties subsitiute a contractual agreement for some other type of legal action.

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Three exceptions to the consideration policy

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-promissory estoppel
-promises to pay debts that are barred by a statue of limitations
-promises to make chartiable constributions

Front 34

What is promissory estoppel and what are the five requirements of it to make a claim?

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A person who has reasonable relied on the promise of another may recover something
1.clear promise 2. the promiser expected promisee to rely on promise 3. promisee acted or restrained from some act 4. there was substantial detriment 5. enforcement is necessary to avoid injustice

Front 35

How can a minor disaffirm a contract? what does disaffirmance mean?

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legal avoidance or setting aside contractual obligation
-They must express intent, return all goods, and make decision within a resonable time

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What are the exceptions to minors' right to disaffirm (2)

Back 36

Misrepersentation of age
Contract for necessaries

Front 37

Define ratification

2 types?

Back 37

the act of accepting and giving legal force to an obligation that previously was unenforcable
-Express (orally or writing)
-Implied

Front 38

Can an intoxication person get out of a contract?

Back 38

only if they prove impared reason and judgement, are within reasonable time period, and return all goods.

Front 39

When is a mental incompetent person's contract

1. void
2. voidable
3. Valid

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1. if court previously appointed guardian
2. if they did not understand nature at the time
3. if they had capacity at time of formation

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4 examples of contracts that are contrary to statue

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1. usurious loans
2.Gambling
3.to commit a crime
4.by unlicensed persons

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6 examples of contracts contrary to public policy

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1. restraint of trade
2.commit a tort
3.unconscionable (substansive & procedural)
4.adheasion
5. exculpatory clauses
6. discrimitory