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43 Cards in this Set

  • Front
  • Back
Name of 5 elements in order to have a valid contract.
1. Offer
2. Acceptance
3. Consideration
4. Legality
5. Capacity
What is Bilateral contract?
A promise for a promise.
-Acceptance takes place upon exchange of promise.
What is Unilateral contract?
A promise for an act.
-Acceptance takes place once the act had been completed.
What is Implied in Fact?
Terms are implied by parties conduct.
What is Express contract?
Terms are written or verbal - known to all parties.
What is Implied in Law?
No agreement between parties. Court will create a contract to avoid unjust enrichment.
What is Quantum Meruit?
"As much as he or she deserves" in an implied in Law.

Someone offers services and they will receive payment as much as he or she deserves.
What is Executed contract?
Contract is fully performed.
What is Executory contract?
At least one party's performance is due under the contract.
What is Valid contract?
Requires all elements are offer, acceptance, consideration, legality, and capacity enforced by all parties.
What is Voidable contract?
At least one party may disaffirm the contract.
What is Void contract?
Never existed in the eyes of the law.
Kellogg's Definition of an Offer
An offer is a communication from an offerer to an identified offeree that leaves a reasonable expectation in the mind of the offeree that nothing further need to be done but to accept.

-An offer must be certain and definite
-A statement of intention is not an offer.
-Advertisement are not offers, they are invitations to negotiate.
What is Auctions?
An offer is made when the bidder acknowledges the auctioneer.
-Acceptance takes place when the gavel falls.
What is Auctions with Reserve?
Seller agrees to the purcahse price.
-Acceptance takes place when the seller agrees to the purchase price.
Name the 8 ways to terminate an offer.
1. Revocation - one can revoke an offer as long as it has not been accepted.

2. Rejection - once an offer is rejected, it's terminated.

3. Counter Offer - terminates original offer.

4. Death - offer dies with individual.

5. Incapacity - one becomes incapacitated.

6. Destruction of the Subject Matter

7. Lapse of time - offer terminated after set time.

8. Illegal - if the subject matter becomes illegal, offer terminated.
Name and Describe of 3 Irrevocable Offers.
1. Option contract - pays consideration to keep an offer.

2. Promissory Estoppel - one relies on a promise to their detriment.

3. Merchant's Firm Offer - offer made by a merchant in writiing to stay open for a stated amount of time. If not stated for a reasonable amount of time, not to exceed 3 months.
Who can accept an offer?
Identified offeree may only accept an offer.

Silence will not constitude acceptance, exceptions:
1. Gesture does constitude
2. Implied in fact contract
3. Offeree solicits the offer
Mode of acceptance
Common law - mode has to be the same as the offer.

Modern law - mode has to be the same or faster as the offer.
Mailbox Rule
Acceptance is effective upon dispatch. A revocation takes place when received.
What is Consideration?
Bargained for exchange - usually a benefit and detriments.
What is Adequacy of Consideration?
Courts do not check into adequacy of the consideration.
What is Preexisting Duty?
If one is obligated under contracts to perform an act, an offer of addition consideration is unenforceable. Exception: if unforeseen difficulties.
What is Past Consideration?
No consideration.
Accord and Satisfaction
Accord is an agreement. Satisfaction is the performance of the agreement.
Liquidated Debt
A fixed amount.
Unliquidated Debt
Amount is in dispute.
What is Release?
Waiver of the right sue.

-Must be a written document
-State the consideration paid
-Signed by the party waiving the right to sue
-Must made in good faith
Promises Enforceable without Consideration
-Promissory estoppel
-Promise to pay a debt where the S/L run
-Promise to make charitable contributions
What is Minors?
If enter into a contract - considered voidable.
Who would have the right to disaffirm the contract?
The minor may disaffirm the contract up to the age of 18.
Contracts of Necessaries
Medical expenses, food, shelter, student loans, etc.
Parent's Liability
Parents are not responsible for contract's entered by child.

-Parent's are responsible for necessaries.
Regarding Torts
Parents, in general, are not responsible.

Parents are liable up to $50,000 for intentional torts children commit and up to $65,000 if it involves public property.

If parents are negligent - fully liable.
If a person is intoxicated...what type of contract?
Voidable contract
Mentally Incompetence
Judicially decreed incompetent - void contract

Mentally incompetent - voidable contract
Lucy v. Zehmer

Rule of the Law
Court will use an objective test to determine capacity.
Hamer v. Sidway

Facts and Rule of the Law
Facts: The uncle promised his nephew $5,000 if he refrained from smoking, and gambling and the nephew refrained from those but the uncle past away.

Rule of the Law: Forebearance for the legal right is a consideration.
What is Usury contract?
Individual is charging above the legal lawful interest rate allowed by the state.

Court uses red line/blue pencil - rewrite.
What is Gambling?
Illegal unless recognized by status.
What is Sabbath Laws?
They are constitutional. They are recognized as a day of rest, not a day of worship.
What is Licensing Statutes?
1. Protection of the public
2. Raise revenue
What is "In Pari Delicto"?
Equally at fault. If parties enter into an illegal contract.

1. Members of Protected Classes...child labor laws

2. Attempted Withdrawal from an Illegal Agreement

3. Justifiable Ignorance of the Law - protect those who lacks capacity