Basic Contract Law Concepts

Question 1

Express Contract

Answer 1

May be oral or written, clearly states terms of agreement between parties

Question 2

Implied Contract

Answer 2

Determined by actions of the party rather than express agreement

Question 3

Bilateral contract

Answer 3

One in which parties are obligated to one another

Question 4

Unilateral Contract

Answer 4

Only one party is obligated to act

Question 5

Voidable contact (can avoid if desire)

Answer 5

One or both parties have option to avoid

Question 6

Void Contract

Answer 6

Not a contract because it lacks legality

Question 7

Invalid Contract

Answer 7

Contract missing an essential legal element

Question 8

Addendum

Answer 8

An addition to an existing contract

Question 9

Ammendment

Answer 9

A change to an existing contract (changes original)

Question 10

Essential elements of valid contract

Answer 10

Offer, acceptance, consideration, legally competent persons, legal purpose

Question 11

Offer and Acceptance

Answer 11

Requires mutual agreement of terms

Question 12

Consideration

Answer 12

Something of value, including a promise to do/not do something

Question 13

Preemption right

Answer 13

Right of first offer. Gives tenant who has held lease 3 or more years first right to enter new lease or buy property

Question 14

Executed contract

Answer 14

Parties have met all terms

Question 15

Executory contract

Answer 15

Contract in progress, one or more terms remain undone

Question 16

Auction contract

Answer 16

Supersedes a listing agreement

Question 17

With Reserve

Answer 17

Auction sale conditional upon meeting minimum sale price

Question 17

With Reserve

Answer 17

Auction sale conditional upon meeting minimum sale price

Question 18

Without reserve

Answer 18

No minimum sales price

Question 19

Statute of Frauds

Answer 19

Contracts involving creation or conveyance of real property must be in writing to be enforceable

Question 20

Uniform Electronic Transaction Act (UETA)

Answer 20

Gives e-sigs and docs the same weight as paper writing and sigs

Question 21

Performance of a contract

Answer 21

When all contract terms and conditions have been met

Question 22

Time is of the essence

Answer 22

Parties will proceed in good faith and try not to unduly delay process

Question 23

Discharge of a contract

Answer 23

Includes partial performance, specific performance substantial performance, impossibility of performance and operation of law

Question 24

Partial performance

Answer 24

One or more parties did not meet all terms of contract. (Other party can decide whether to accept or not)

Question 25

Specific performance of contract

Answer 25

Requirement to meet the terms of the contract exactly

Question 26

Substantial performance

Answer 26

Most but not all requirements have been met, party not meeting may be required to pay damages

Question 27

Impossibility of performance

Answer 27

Parties cannot legally or practically do what they agreed (then released from obligations)

Question 28

Operation of law

Answer 28

How an individual can automatically acquire rights or liabilities due to law, not an agreement or act of their own

Question 29

Assignment of a contract

Answer 29

Contractual obligation transferred from one to another

Question 30

Novation of contract

Answer 30

The substitution of one party for another in an agreement (original party released from obligations)

Question 31

Breach of contract

Answer 31

Failure of one party to meet one or more terms

Question 32

Fraud

Answer 32

Trickery or deceit to induce someone to do something (conceal material facts, false info, trickery)

Question 33

Misrepresentation

Answer 33

False statement of a material fact in real estate transaction, intentionally or through lack of care.