BLAW FINAL Flashcards
One of the elements of a contract is “must have a _____ purpose or object”.
Legal
If an illegal agreement is executor, the Court (will/will not) enforce it, nor allow __________. If it has been executed, the Court will leave the parties as it finds them.
Will not; recovery of damages
Illegality
Contracts to Commit Crimes or Civil Wrongs
There are contracts that are ____ because they violate public policy even though it does not run afoul of any specific statute or the common law.
Void
Contracts limiting liability for negligence are generally ______ as against public policy.
Unenforceable
If the legislative (license) intent is primarily to raise revenue the contract is ________
Enforceable
What us Usery
Charging a greater interest rate than allowed by law.
What is the penalty for Usery in N.C.?
Forfeiture of the entire amount of interest charged. Preferred approach and the approach used in NC. (Don’t get interest back – forfeiture of ALL interest)
Contracts in Restraint of Trade - Under the “old” Common Law an agreement that placed a restraint on a man’s right to pursue his trade or profession was ____ as against public policy.
Void
Recently, the Courts have permitted the enforcement of certain restrictive covenants as long as they meet certain requirements.
Contracts in Restraint of Trade
Covenants not to Compete – generally OK if they are what 3 things?
(1) for reasonable length of time (2) reasonable in geographic area of restriction, and (3) have the element of consideration
_______ ___ ______ requires that certain types of contracts in writing, or there be written memorandum concerning the contract, signed by the party being sued for it to be enforceable.
Statute of Frauds
Statute of Frauds: What is required of a contract to be said to “fall within the statue”.
Needs to be in writing to be enforceable
Statute of Frauds: What is required of a contract to be said to “fall outside the statute”.
If the statute does not apply,
The statute does not render an oral contract that falls within the statute void – just ________ .
Unenforceable
When one promises to pay the debt incurred by another, the contract must comply with the Statute to beenforceable. Limited to collateral promises (in nature of guarantee) rather than primary promises.
Promise to Ansswer for the Debt of Another.
“Sell the goods to Jones, and if Jones does not pay, I will pay” (writing required).
Collateral promise
“Let Jones have the goods and I will pay” (no writing requirement).
Primary promise
Agreement made upon consideration of marriage
Does not apply tomutual promises to marry or engagement agreements. Only occurs when the marriage is part of the consideration given in return for some other performance. Example: prenuptial agreements (must be in writing to be enforceable)
Not only sale of land,but also any interest in land (real estate sales contract, easement, mortgage, rights-of-way) falls within the statute.
Contracts for the Sale of an Interest in land
Does a license to hunt on real estate fall within the statute?
No – permission rather than sale.
Purchaser has paid part of the price, taken possession, and made permanent improvements. This is a
Partial Performance Exception
Agreements not to be performed within one year from the time oftheir making. Courts hold that only contracts on which performance within a year from the date of making is impossible fall within the statute (required to be ______).
In writing
Statute of Frauds Section of the UCC
Any contract for the sale of goods under the UCC at a price of $500 or more must be in writing
One may not introduce oral evidence at a trial to contradict the clear, unambiguous terms of a written agreement. Does not prevent all oral testimony concerning a contract from being introduced at trial, only oral testimony that contradicts the clear, unambiguous terms of a written agreement.
Parole - Evidence Rule
3 Exceptions to the Parole-Evidence Rule?
(1) Evidence of any subsequent modification (2) Evidence to explain ambiguity (3) Evidence to “fill in the gaps” if the written agreement lacks one or more essential terms.
Occurs when the promisor obligates himself to satisfy a duty owed by the promise to his creditor.
Third-Party Creditor Beneficiary
Third party that may not sue to enforce any of the contractual provisions
Third-Part Incidental Beneficiary
Generally, when a third party beneficiary has accepted, adopted, or acted upon the agreement, the parties may not change it without his/her consent.
Rescission and Vesting
person who transfers his contractual right. (Original Party
Assignor
The person to whom the right is transferred.
Assignee
Party to the contract against whom the right may be exercised. (Original Party)
Obligator
An _______ under a contract occurs when one party transfers his rights under the agreement to a third person.
Assignment
As a general rule, one may assign contractual rights, but may not assign contractual duties. May “delegate” contractual duties if they do not involve personal service or the personal attention of the obligor.
Assignment
Future accounts or earnings that are not founded on an existing contract are generally not assignable because the account or debt is merely speculative and has no potential existence. These are…
Contractual Rights that may not be assigned
The assignee takes the assignment of the contractual right subject to all the defenses that the obligor could raise against the assignor i.e. the “_____ stands in the shoes of the ______”.
Assignee - Assignor
Notice of assignments - Multiple Assignments
the first bona fide assignee for value to notify the debtor of the assignment prevails, regardless of whether he/she is the first person to receive the assignment in point of time. Followed by the majority of jurisdictions.
may be either conditions precedent, conditions subsequent, or conditions concurrent.
Express Conditions
When the parties under a contract are required to perform simultaneously.
Conditions Concurrent
When applicable, the party substantially performing under the contract is entitled to recover but subject to the right of the innocent party to be compensated for the damages occasioned by the defects in performance, but is not excused from performance.
Doctrine of Substantial Performance
Applicable where full and exact performance of every detail of the contract has not been rendered but where there has been good faith attempt to perform the agreement, resulting in substantial compliance.
Doctrine of Substantial Performance
When a portion of the required performance is not completed, generally intentionally.
Doctrine of Partial Performance
