Business Law- Chapter 16 Flashcards

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1
Q

Breach of Contract

A

A contracting party’s failure to perform an absolute duty owed under a contract.

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2
Q

Complete Performance

A

A situation in which a party to a contract renders performance exactly as required by the contract. Complete performance discharges that party’s obligations under the contract.

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3
Q

Tender of Performance

A

An unconditional and absolute offer by a contracting party to perform his or her obligations under a contract.

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4
Q

Substantial Performance

A

Performance by a contracting party that deviates only slightly from complete performance.

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5
Q

Minor Breach

A

A breach that occurs when a party renders substantial performance of her contractual duties.

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6
Q

Material Breach

A

A breach that occurs when a party renders inferior performance of his contractual duties.

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7
Q

Inferior Performance

A

A situation in which a party fails to perform express or implied contractual obligations and impairs or destroy the essence of a contract.

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8
Q

Anticipatory Breach

A

A breach that occurs when one contracting party informs the other that she will not perform the other her contractual duties when done.

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9
Q

Monetary Damages

A

An award of Money

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10
Q

Compensatory Damages

A

An award of money intended to compensate a non-breaching party for the loss of the bargain. Compensatory damages place the non breaching party in the same position as if the contract had been fully performed by restoring the “benefit of the bargain”.

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11
Q

Mitigation

A

A non-breaching party’s legal duty to avoid to reduce damages caused by a breach of contract.

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12
Q

Consequential Damages

A

Foreseeable damages that arise from circumstances outside a contract. To be liable for these damages, the breaching party must know or have reason to know that the breach will cause special damages to the other party.

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13
Q

Liquidated Damages

A

Damages that parties to a contract agree in advance should be paid if the contract is breached.

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14
Q

Nominal Damages

A

Damages awarded when the non-breaching party sues the breaching party even though no financial loss has resulted from the breach. Nominal damages are usually $1 or some other small amount.

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15
Q

Writ of Attachment

A

An order of the court that enables a government officer to seize property of the breaching party and sell it at auction to satisfy a judgment.

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16
Q

Writ of Garnishment

A

An order of the court that orders that wages, bank accounts, or other property of the breaching party held by third persons be paid to the non-breaching party to satisfy a judgement.

17
Q

Rescission

A

An action to rescind a contract. Rescission is available if there has been a material breach of contract, fraud, duress, undue influence, or mistake.

18
Q

Restitution

A

The return of goods or property received from the other party to rescind a contract. If the actual goods or property are not available, a cash equivalent must be made.

19
Q

Specific Performance

A

A remedy that orders the breaching party to perform the acts promised in the contract. Specific performance is usually awarded in cases in which the subject matter is unique, such as in contracts involving land, heirlooms, and paintings.

20
Q

Reformation

A

An equitable doctrine that permits the court to rewrite a contract to express the parties’ true intentions.

21
Q

Injunction

A

A court order that prohibits a person from doing a certain act.

22
Q

Intentional Interference with Contractual Relations

A

A tort that arises when a third party induces a contracting party to breach the contract with another party.

23
Q

Covenant of Good Faith and Fair Dealing

A

An implied covenant under which the parties to a contract not only are held to the express terms of the contract but are also required to act in “good faith” and deal fairly in all respects in obtaining the objective of the contract.