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34 Cards in this Set
- Front
- Back
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4 essential elements of a valid contract |
1. agreement 2. consideration 3. capacity 4. legality |
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Agreement |
mutual decent "meeting of the minds" - serious offer** - definite - communicated |
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Consideration |
bargain for exchange, benefit & detriment |
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Capacity |
- minors lack capacity - ruled insane lack capacity - intoxicated person lacks capacity |
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Legality |
contract contrary to public policy: has a negative impact on society or interferes with the publics safety EX: dad offers daughters boyfriend $$ to not marry her bc he's giving up her right to marry |
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Bilateral Contract |
"promise for a promise" EX: if i promise to pay you $50 for you to mow my law |
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Unilateral Contract |
promise for a specific act EX: mow the lawn & then ill pay you $50 has to be completed before you get the promise |
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Mailbox Rule |
"if you mailed it they got it" - acceptance is effective when it is dispatched, even if it is lost in translation |
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Implied-in-fact contract |
agreement between parties has been inferred from their conduct |
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Implied-in-law contract (Quasi-contract) |
court may award $ damages to a plaintiff for providing work or services to a defendant even though no actual contract existed EX: if you are unconscious & an ambulance brings you to a hospital and then you get billed |
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Termination of an offer |
- Revocation: withdrawal of an offer by the offeror that terminates the offer - Rejection: Offeree rejects the offer - Counteroffer: response by offeree that contains different terms then originally stated - Time lapse: state of time the terminates it |
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Acceptance of a contract |
Mirror image rule: the offeree must accept the terms as stated in the offer |
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Consideration |
something of legal value given in exchange for a promise |
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Bargained-for-exchange |
exchange that parties engage in that leads to an enforceable contract |
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Exculpatory Clause (real ease of liability clause) |
relieves one or both of the parties form tort liability for ordinary negligence |
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non-compete clause |
enforceable, in employment contract saying you can't leave that company and go work for competitor or open your own store, has to be reasonable w/i time and geographical area |
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Lucy v. Zehmer |
Zehmer owned the Ferguson Farm & lucy wanted to buy it. Lucy offered $50,000 and Zehmer made a contract on a piece of paper (& rewrites it) so his wife can sign it. Zehmer later says he was joking so Lucy sued and got the farm |
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Unilateral mistake |
only one party is mistaken about the facts in the contract |
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Mistake of value |
both parties know the object of the contract but are mistaken to its value |
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Fraud |
one party consciously tries to induce the other party to rely and act on misrepresentation - misrepresentation - intent to deceive: scienter "guilty mind" - injury to an innocent party |
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Undue influence |
takes advantage of another persons mental, emotional or physical weakness |
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Duress |
party threatens to do a wrongful act unless another party enters into a contract |
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Statue of Fraud |
have to be in writing - agent contracts - real estate - guaranty contracts - UCC contracts sale or lease goods Marriage Years > 1 yr Land Executor/ estate Goods > $500 Surety (co-sign) |
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Compensatory damages |
award of $ intended to compensate a non breaching party for the loss of the bargain |
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Consequential damages |
damages that arise from circumstances outside a contract - foreseeable damages |
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Liquidated damages |
damages that parties agree in advance should be paid if the contract is breached |
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Mitigation of damages |
a non breaching party's legal duty to avoid or reduce damages caused by a breach in the contract |
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Specific performance |
court orders that the breaching party to preform the acts promised in the contract. subject matter must be unique |
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Injunction |
court prohibits a party from doing a certain act. injunctions are available only in limited circumstances |
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Reformation |
court rewrites a contract to express the parties true intentions. used to correct clerical errors |
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Recession |
Undo a contract |
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Mutual recession |
both parties enter into a second contract that expressively terminates the first one |
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Novation |
substitutes a third party for one of the original contracting parties |
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Accord |
parties agree to accept something different in satisfaction of the original contact |
