Lsb 5163 Unit 2

Front 1

The source of law for contracts dealing with real property and services is:

Back 1

Common Law

Front 2

The source of law for contracts dealing with the sale of goods is:

Back 2

Statutory Law
(Uniform Commercial Code)

Front 3

The key requirement for getting a patent is that the idea must be:

Back 3

Novel or totally new

Front 4

The statutory bar will preclude the granting of your patent if you've made the invention public ____ prior to the filing.

Back 4

1 year

Front 5

For inventions developed during employment, a _________ clarifies ownership of inventions.

Back 5

assignments of inventions clause

Front 6

A utility patent protects invention rights for _____ yrs, and a design patent protects for ____ yrs.

Back 6

20, 14

Front 7

A copyright provides protection for works that are _______ and fixed in a _______. Copyrights protect for the life of the author/creator plus ___ yrs.

Back 7

original, tangible medium, 70

Front 8

In a work for hire situation, copyright protection is good for ____ yrs after publication or ____ yrs after creation (whichever is less).

Back 8

95, 120

Front 9

Which types of trademarks can be protected? Which type cannot be protected?

Back 9

Fanciful,arbitrary, suggestive

Descriptive

Front 10

Formulas, patterns, devices, or compilations of information used in business for competitive advantage are:

Back 10

trade secrets

Front 11

What are two ways to protect trade secrets?

Back 11

non-disclosure agreements &
Covenants not to compete

Front 12

T/F Common law contracts are more formal than contract requirements under the Uniform Commercial Code (UCC).

Back 12

True - because they're based on case law.

Front 13

A(n) _____ contract is clear and stated in words or writing.

Back 13

express

Front 14

A(n) ______ contract is implied by the conduct of the parties.

Back 14

implied

Front 15

When a party benefits from an agreement, but wasn't a party to the actual contract, it might be considered a __________.

Back 15

quasi contract
(an agent situation is a common area for the possibility of a quasi contract)

Front 16

A _____ contract has all the elements of a prima facie case.

Back 16

valid contract

Front 17

When one or both parties to a contract lack the capacity to enter into a contract, you have a ______.

Back 17

voidable contract

Front 18

Some types of contracts must be written. If they're not, they're considered __________.

Back 18

unenforceable contracts

Front 19

What type of contract requires a notary or seal?

Back 19

formal contract

Front 20

T/F Most contracts are formal contracts.

Back 20

false - most are informal

Front 21

A performed contract is a(n) _____ contract.

Back 21

executed

Front 22

A contract that is not performed or performed by only one side is called a(n) _______ contract.

Back 22

executory

Front 23

Which type of contract is a "promise for an act"?

Back 23

unilateral contract
(no liability until the act occurs)

Front 24

Which type of contract is a "promise for a promise"?

Back 24

bilateral contract

Front 25

For a written contract, any ambiguities are construed against ________.

Back 25

the drafter

Front 26

T/F Written or typed terms in a contract prevail over preprinted terms.

Back 26

true

Front 27

Under contract law, the offeror must have a serious intent to be ______, key terms must be ____________, and the offer must be communicated to ______.

Back 27

bound, reasonably certain and definite, offeree

Front 28

To have a lawful contract, an agreement must be based on _______, not subjective intentions.

Back 28

objective evidence

Front 29

The key terms of a contract include: identification of _______, _______of contract, statement of _______, and payment/delivery/_______ terms.

Back 29

parties, subject matter, consideration, performance

Front 30

The equal dignities rule requires an agency relationship to be ______.

Back 30

written.

Front 31

Advertisements are not considered binding agreements (contracts), because they fail to identify all _______ and there is no communication to _______.

Back 31

key terms, a specific offeree

Front 32

At what point can an offer be terminated by revocation?

Back 32

at any time before its accepted

Front 33

An option contract is a(n) _______ offer because it acts like a mini-contract that holds an offer open in order to arrange financing, etc. (earnest money in a real estate deal)

Back 33

irrevocable
(an option contract should have a time limit)

Front 34

An offer can be terminated by rejection, counteroffers, or _________.

Back 34

operation of law
(lapse of time, destruction of subject matter, death, supervening illegality)

Front 35

For a contract to be formed, what the offeree accepts must be exactly the same as what the offeror has offered. This is known as the ________ rule.

Back 35

mirror-image
(aka meeting of the minds)

Front 36

A prima facie case for contracts requires consideration. What are the 3 requirements for proof of consideration?

Back 36

1. Exchange of legal value
2. Legal detriment
3. Bargained for exchange

Front 37

Doing or promising to do something you have a legal obligation to do or refraining from doing something you have a legal right to do is known as:

Back 37

Legal detriment

Front 38

The doctrine of Promissory Estoppel includes 5 elements. Name them.

Back 38

1. clear and definite promise
2. reliance
3. reliance was justifiable and reasonable
4. reliance causes substantial detriment
5. injustice results

Front 39

An exception to consideration that stops someone from breaking a promise is:

Back 39

Promissory Estoppel

Front 40

The two types of mistakes regarding contracts are:

Back 40

1. mistakes of fact
(most important in defense of a contract)
2. mistakes of quality/value
(usually mistakes of judgement)

Front 41

A ______ mistake directly undermines whether or not the parties had a true "meeting of the minds".

Back 41

material

Front 42

A(n) _______ mistake generally doesn't matter to the outcome of the contract.

Back 42

immaterial

Front 43

A mutual misunderstanding regarding an assumption on which the contract is made is a:

Back 43

bilateral mistake
(mutual mistake - no meeting of the minds)

Front 44

When one party to a contract made a mistake (lack of due diligence), a _______ has been made.

Back 44

unilateral mistake
(usually the contract is still upheld)

Front 45

If a unilateral mistake has been made, but the other party knows - or should have known - the contract is:

Back 45

voidable
(at the option of the mistaken party)

Front 46

A couple ways to show fraud in a contract are:

Back 46

1. fraud in factum
2. fraud in inducement

Front 47

What are the three elements of prima facie case for fraud?

Back 47

1. intent to deceive
2. false statement of material fact
3. reliance on statement

Front 48

A defense based on formation of a contract via lack of voluntary consent, must show ______ or ______.

Back 48

Undue influence, duress
(contract is then voidable)

Front 49

What are 5 defenses of contract formation based on public policy?

Back 49

1. Capacity (minor or mental incompetence)
2. Disaffirmance
3. Ratification
4. Restraints of trade
5. Contrary to statute

Front 50

T/F Contracts by someone who has been declared incompetent are always void.

Back 50

True

Front 51

3 different contract defenses based on mental incompetency are:

Back 51

1. adjudicated incompetent - void
2. incompetency provable - voidable
3. lucid interval - valid

Front 52

The two categories of defense to the enforcement of an existing contract are:

Back 52

1. unconscionable contracts
2. certain contracts must be written

Front 53

The two major types of unconscionable contracts are:

Back 53

1. procedural unconscionability
2. substantive unconscionability

Front 54

A contract that is oppressive, overly harsh, or leaves one party without remedy is:

Back 54

substantively unconscionable
(the contract itself is unfair)

Front 55

A situation in which the bargaining process for a contract is unfair is known as:

Back 55

procedural unconscionability

Front 56

A lack of opportunity to review a contract, add-on clauses, buried clauses, contracts of adhesion, and arbitration clauses are possible sources of:

Back 56

procedural unconscionability

Front 57

Statute of Frauds requires certain types of contracts be:

Back 57

written

Front 58

The 4 types of contracts that must be in writing to be enforceable are:

Back 58

1. contracts involving land
2. contracts that cannot be performed within 1 year
3. collateral or secondary contracts
4. promises made in consideration of marriage

Front 59

A condition to perform under a contract that arises prior to duty is a:

Back 59

condition precedent
(usually express)

Front 60

A condition to perform under a contract that arises simultaneously is a:

Back 60

concurrent condition
(usually implied)

Front 61

A condition under a contract that discharges a party after performance has begun is a:

Back 61

condition subsequent
(usually express)

Front 62

The duty to perform a contract can be discharged by the preformance of the contract, or by _______ or by ________.

Back 62

agreement, operation of law

Front 63

Discharging the duty to perform via rescission, novation, substituted agreement, or accord & satisfaction is known as:

Back 63

discharge by agreement

Front 64

Discharging the duty to perform via material alteration, statute of limitations, bankruptcy, impossibility of performance, impracticability of performance, or frustration of purpose is known as:

Back 64

discharge by operation of law

Front 65

If an unforeseen external condition beyond the control of either party affects the possibility of performance, you have:

Back 65

impossibility of performance

Front 66

If an unforeseen external condition beyond the control of either party makes the contract inefficient (one party will suffer a loss), you have:

Back 66

impracticability of performance

Front 67

A(n) __________ of a contract occurs when one party knows ahead of time (before performance is due) that the other party will breach the contract.

Back 67

anticipatory repudiation

Front 68

Because of the mirror image rule, any deviation from perfect and complete performance is considered a:

Back 68

breach of contract

Front 69

A _______ breach does not release non-breaching party from contract obligations.

Back 69

minor
(non-breaching party may have to perform and sue for damages)

Front 70

If there is substantial (but not complete) performance of the contract, you have a:

Back 70

minor breach

Front 71

If there is less than substantial performance on a contract, then you have a:

Back 71

material breach

Front 72

Returning goods, property, or funds (recapturing benefit) is known as:

Back 72

restitution

Front 73

A _______ rescission discharges the contract.

Back 73

mutual

Front 74

A _______ rescission allows for restitution.

Back 74

unilateral

Front 75

________ of an agreement is an equitable remedy that may be used if there was fraud or a mistake.

Back 75

reformation

Front 76

________ damages are used to cover direct losses and costs of a breach.

Back 76

Compensatory/expectation

Front 77

_________ damages are used to cover indirect and foreseeable losses.

Back 77

Consequential
(may include lost profits)

Front 78

_______ damages are used to cover lesser and minor losses.

Back 78

Incidental

Front 79

_______ damages are used to recognize wrongdoing when no monetary loss is shown.

Back 79

nominal

Front 80

________ damages are used to punish and deter.

Back 80

punitive
(must be a tort)

Front 81

What is the formula for measuring the amount of damages for a contract breach?

Back 81

compensatory damages
+ consequential damages
+ incidental damages
- costs avoided
= total damages

Front 82

A __________ clause in a contract can act to discharge the contract if an act of god or other external force affects performance of the contract.

Back 82

force majeure

Front 83

A __________ provision is used in a contract when it will be very difficult to determine the amount of damages.

Back 83

liquidated damages
(agreed upon in advance)

Front 84

A _________ clause is used to mitigate liability and allow for fair measure of recovery.

Back 84

limitation of liability

Front 85

The UCC defines goods as "all things which are ______ at the time of identification to the contract for sale".

Back 85

movable

Front 86

___________ means that only the parties who have entered into the contract traditionally have rights and liabilities under the contract.

Back 86

Privity of contract

Front 87

Transfer of contractual rights is called:

Back 87

assignment

Front 88

Transfer of contractual duties is called:

Back 88

delegation

Front 89

A legal effect of an assignment is the assignor's rights are:

Back 89

extinguished

Front 90

A legal effect of a delegation is the _______ and _______ remain liable to the obligee.

Back 90

delegator, delegatee

Front 91

T/F Worker's compensation awards can be assigned to a third party.

Back 91

False - prohibited by statute

Front 92

T/F A contract for a service that is personal in nature cannot be assigned to a third party.

Back 92

True

Front 93

T/F A contract with an insurance company can be assigned to a third party.

Back 93

False

Front 94

Duties may not be delegated when: performance by delegatee materially alters obligee expectations, ________, or _______.

Back 94

duties are personal in nature, contract prohibits delegation

Front 95

The UCC applies only to _______, and common law covers _______, and _______.

Back 95

sale of goods, real property, services

Front 96

Statute of limitations under UCC is ___ years.

Back 96

5 (tort law is only 2 yrs)

Front 97

T/F UCC preempts common law.

Back 97

True
(unless UCC is silent)

Front 98

T/F UCC is uniform across all the states.

Back 98

False - there are some variations among the states

Front 99

The UCC applies to both ______ and _______ transactions.

Back 99

commercial, consumer

Front 100

If terms in a contract are missing or left open, and a dispute later arises over the missing term, the court may simply use a ______ as provided by _______.

Back 100

"gap-filler", the UCC

Front 101

T/F Acceptance under UCC rules may contain terms that are different from those in the offer.

Back 101

True - UCC eliminates mirror image rule

Front 102

Under the UCC, consideration is required for contracts, but not ________.

Back 102

modifications

Front 103

An express warranty is created under UCC when the seller gives a ________ relating to the goods.

Back 103

statement, promise, description, sample, or model
(these must become part of the basis of the bargain)

Front 104

The ______________ guarantees that the goods are reasonably fit for the general purpose for which they are sold.

Back 104

implied warranty of merchantability

Front 105

The ___________guarantees that the goods are fit for a particular purpose beyond the scope of ordinary purposes for which the seller recommended them.

Back 105

implied warranty of fitness for a particular purpose
(covers any seller if seller knows of buyer's purpose and knows buyer is relying on seller's advice)

Front 106

The best way to allocate the risk of loss is:

Back 106

by contract

Front 107

Under a UCC destination contract, risk of loss passes when:

Back 107

goods are off-loaded
(from carrier)

Front 108

Under a UCC origin contract, risk of loss passes when:

Back 108

goods are delivered to the carrier

Front 109

If goods are held in a warehouse, risk of loss passes with:

Back 109

bill of lading

Front 110

In a merchant/buyer situation, risk of loss passes when:

Back 110

buyer takes possession of the goods.