CH13,14,15,16 Flashcards
1
Q
Rescission
A
Canceling a contract and returning parties to their pre-contractual positions.
2
Q
Mutual Mistake
A
Both parties mistaken about a material fact.
3
Q
Fraud & Misrepresentation
A
False statement of material fact to induce a contract.
4
Q
Fraud in the Inception
A
Deception about the nature of the document being signed.
5
Q
Misrepresentation of Law
A
False statement about the law.
6
Q
Duress
A
Improper threat that leaves victim no reasonable alternative.
7
Q
Undue Influence
A
Excessive persuasion overcoming free will, often in relationships of trust.
8
Q
Statute of Frauds
A
Certain contracts must be in writing to be enforceable.
9
Q
Promissory Estoppel
A
Enforcing promises despite lack of consideration/writing.
10
Q
Lease
A
Contract transferring possession/use of property for a period.
11
Q
Guarantor
A
Agrees to pay debt if primary obligor fails.
12
Q
Part Performance
A
Enforcing oral contract despite Statute of Frauds.
13
Q
Incorporation by Reference
A
Making external document part of contract by referencing it.
14
Q
Parol Evidence Rule
A
Bars evidence of prior/contemporaneous agreements contradicting written agreement if fully integrated.
15
Q
Merger Clause
A
Contractual provision stating written document contains entire agreement.
16
Q
Obligor
A
Party with a legal duty to perform under contract (promisor/debtor).
17
Q
Assignor
A
Party who transfers contractual rights to another.
18
Q
Assignment
A
Transfer of contractual rights to a third party.
19
Q
Delegation
A
Transfer of contractual duties to a third party.
20
Q
Intended Beneficiary
A
Third party specifically meant to benefit from contract.
21
Q
Incidental Beneficiary
A
Third party who indirectly benefits but is not an intended beneficiary.
22
Q
Covenant
A
Promise or agreement in a contract.
23
Q
Conditions
A
Contract terms making performance contingent on an event.
24
Q
Condition Precedent
A
Event that must occur before a duty arises.
25
Condition Subsequent
Event that terminates an existing duty to perform.
26
Concurrent Condition
Each party's duty is conditional on the other's simultaneous performance.
27
Force Majeure
Unforeseeable circumstances preventing contract fulfillment.
28
Statute of Limitations
Time limit to file a lawsuit after a cause of action arises.
29
Strict Performance
Exact compliance with all contract terms.
30
Material Breach
Substantial violation defeating contract's purpose.
31
Minor Breach
Non-material failure to perform.
32
Anticipatory Breach
Clear indication before performance is due that a party won't perform.
33
Compensatory Damages
Monetary award to place non-breaching party in position if contract was performed.
34
Mitigation of Damages
Non-breaching party's duty to minimize damages.
35
Liquidated Damages
Predetermined damages amount in contract for breach.
36
Equitable Remedies
Non-monetary remedies when damages are inadequate.
37
Specific Performance
Court order requiring breaching party to fulfill contractual obligations.
38
Injunction
Court order prohibiting or requiring specific actions.
39
Arbitration
Dispute resolution by a neutral third party with a binding decision.
40
Intentional Interference with Contractual Relations
Tort where a third party induces breach/prevents performance of a contract.
41
Rescission - Requirements
Prompt action after discovering the defect; Offer of restitution.
42
Rescission - Effect
Terminates the contract; Returns parties to their pre-contractual positions.
43
Mutual Mistake - Requirements
Mistake relates to a basic assumption; Mistake has a material effect; Party seeking avoidance didn't bear the risk.
44
Mutual Mistake - Effect
Contract is voidable by the adversely affected party.
45
Fraud & Misrepresentation - Requirements
False statement of material fact; Intent to deceive (scienter for fraud); Justifiable reliance; Causation; Damages.
46
Fraud & Misrepresentation - Effect
Contract is voidable; Injured party may seek rescission or damages.
47
Fraud in the Inception - Requirements
Deception regarding the nature of the document signed; Lack of knowledge/reasonable opportunity to know.
48
Fraud in the Inception - Effect
Contract is void.
49
Misrepresentation of Law - Requirements
(Modern View): Party making the misrepresentation possesses superior knowledge of the law OR a confidential relationship exists.
50
Misrepresentation of Law - Effect
Contract may be voidable by the injured party.
51
Duress - Requirements
Coercion involving an improper threat (physical or economic); Coercion deprives the victim of free will; Victim has no reasonable alternative.
52
Duress - Effect
Contract is voidable by the victim.
53
Undue Influence - Requirements
A susceptible party; Opportunity to exert undue influence; Disposition to do so; A result showing influence (unfair advantage).
54
Undue Influence - Effect
Contract is voidable by the victim.
55
Statute of Frauds - Requirements
A written contract or memorandum signed by the party to be charged; The writing must contain the essential terms.
56
Statute of Frauds - Effect
Contracts within the Statute are unenforceable if not in writing.
57
Promissory Estoppel - Requirements
A clear and unambiguous promise; Reasonable and foreseeable reliance; Detriment to the relying party; Injustice if the promise is not enforced.
58
Promissory Estoppel - Effect
Allows enforcement of a promise even without consideration or a written contract.
59
Lease - Requirements
(For leases over one year): Must be in writing; Must identify the parties, the premises, the term, and the rent.
60
Lease - Effect
Grants the tenant the right to possess and use the property; Creates obligations for both landlord and tenant.
61
Guarantor - Requirements
The guaranty agreement must be in writing and signed; There must be consideration for the guaranty.
62
Guarantor - Effect
The guarantor becomes secondarily liable for the debt if the primary obligor defaults.
63
Part Performance - Requirements
Unequivocal acts that clearly indicate a contract; The acts must be consistent with the alleged contract and inconsistent with any other explanation.
64
Part Performance - Effect
Allows enforcement of an oral contract that would otherwise be barred by the Statute of Frauds.
65
Incorporation by Reference - Requirements
The incorporating document must clearly identify the incorporated document; The incorporated document must be in existence at the time of the agreement; The parties must intend to incorporate the document.
66
Incorporation by Reference - Effect
Makes the incorporated document part of the contract as if it were fully set forth therein.
67
Parol Evidence Rule - Requirements
A fully integrated written contract (a complete and final expression of the parties' agreement).
68
Parol Evidence Rule - Effect
Prevents the introduction of prior or contemporaneous extrinsic evidence that contradicts, varies, or adds to the terms of the written contract.
69
Merger Clause - Requirements
Clear and unambiguous language indicating that the written contract is the complete and exclusive agreement of the parties.
70
Merger Clause - Effect
Strengthens the parol evidence rule; Demonstrates the parties' intent that the written contract represents the final and complete agreement.
71
Obligor - Requirements
To perform the obligations outlined in the contract according to its terms.
72
Obligor - Effect
Fulfilling the contractual duties leads to discharge; Failure to perform results in breach and potential liability for damages.
73
Assignment - Requirements
Present intent to transfer rights; Assignor's rights must be assignable (not prohibited by contract/law).
74
Assignment - Effect
Assignee acquires the rights of the assignor; The obligor must now perform for the assignee; The assignor generally relinquishes rights.
75
Delegation - Requirements
Delegator must intend to transfer the duty; Duty must be delegable (not involving special skill/trust).
76
Delegation - Effect
Delegatee becomes obligated to perform the duty; The delegator remains liable if the delegatee fails to perform (unless there is a novation).
77
Intended Beneficiary - Requirements
The intent to benefit the third party must be clear from the contract language or surrounding circumstances; The beneficiary must be more than an incidental beneficiary.
78
Intended Beneficiary - Effect
The intended beneficiary has the right to enforce the contract directly against the promisor.
79
Incidental Beneficiary - Requirements
Benefits from a contract, but without any contractual rights.
80
Incidental Beneficiary - Effect
No right to enforce the contract.
81
Covenant - Requirements
Must be clearly stated (express) or implied from the contract.
82
Covenant - Effect
Creates a contractual duty; Breach gives rise to a cause of action for damages.
83
Conditions - Requirements
Must be clearly expressed (express) or implied from the nature of the agreement.
84
Conditions - Effect
Affect the duty to perform; The happening or non-happening of a condition can trigger, suspend, or terminate a contractual obligation.
85
Condition Precedent - Requirements
The condition must occur before the performance obligation arises.
86
Condition Precedent - Effect
No duty to perform unless and until the condition occurs.
87
Condition Subsequent - Requirements
The condition must occur after a duty to perform has arisen.
88
Condition Subsequent - Effect
Terminates an existing duty to perform.
89
Concurrent Condition - Requirements
The parties are to perform their respective duties simultaneously.
90
Concurrent Condition - Effect
Neither party is obligated to perform unless the other party is ready, willing, and able to perform.
91
Force Majeure - Requirements
An event beyond the party's control; The event must be unforeseeable; The event must make performance impossible or impracticable.
92
Force Majeure - Effect
Excuses performance or suspends performance during the force majeure event.
93
Statute of Limitations - Requirements
A lawsuit must be filed within the statutory period after the cause of action accrues.
94
Statute of Limitations - Effect
Bars the right to sue if the lawsuit is not filed within the statutory period.
95
Strict Performance - Requirements
The contract expressly requires strict performance; The nature of the contract is such that strict performance is essential.
96
Strict Performance - Effect
Any deviation from the contract terms constitutes a breach.
97
Material Breach - Requirements
A substantial failure to perform a material term of the contract.
98
Material Breach - Effect
Discharges the non-breaching party from further performance; Gives the non-breaching party the right to sue for damages.
99
Minor Breach - Requirements
A breach that is not material.
100
Minor Breach - Effect
The non-breaching party is not discharged from the contract; The non-breaching party is entitled to damages caused by the breach.
101
Anticipatory Breach - Requirements
A clear and unequivocal indication that a party will not perform the contract when performance is due.
102
Anticipatory Breach - Effect
Gives the non-breaching party the option to sue immediately or wait until the performance date; Allows the non-breaching party to suspend their own performance.
103
Compensatory Damages - Requirements
The damages must be foreseeable; The damages must be proven with reasonable certainty; The non-breaching party must have made reasonable efforts to mitigate damages.
104
Compensatory Damages - Effect
A monetary award designed to compensate the non-breaching party for the loss of their bargain.
105
Mitigation of Damages - Requirements
The non-breaching party must take reasonable steps to minimize the damages caused by the breach.
106
Mitigation of Damages - Effect
The non-breaching party cannot recover damages that could have been avoided through reasonable mitigation efforts.
107
Liquidated Damages - Requirements
The damages must be difficult to estimate at the time of contracting; The amount of liquidated damages must be a reasonable forecast of the actual damages; The liquidated damages clause must not be a penalty.
108
Liquidated Damages - Effect
The non-breaching party is entitled to recover the agreed-upon amount of liquidated damages, regardless of the actual damages suffered (provided the clause is enforceable).
109
Equitable Remedies - Requirements
The legal remedy (damages) must be inadequate to compensate the non-breaching party; The subject matter of the contract must be unique (for specific performance).
110
Equitable Remedies - Effect
A court order requiring a party to perform a specific act (specific performance) or refrain from performing a specific act (injunction).
111
Specific Performance - Requirements
A valid contract with definite and certain terms; Inadequate legal remedy; The subject matter of the contract is unique; Feasibility of enforcement by the court.
112
Specific Performance - Effect
The breaching party is ordered to perform the contract according to its terms.
113
Injunction - Requirements
Irreparable harm; Inadequate legal remedy; Likelihood of success on the merits; Balance of hardships favors the moving party.
114
Injunction - Effect
A court order prohibiting or requiring a specific action.
115
Arbitration - Requirements
A valid arbitration agreement between the parties.
116
Arbitration - Effect
The parties agree to resolve their disputes through arbitration instead of litigation; The arbitrator's decision is binding and enforceable in court.
117
Intentional Interference with Contractual Relations - Requirements
A valid contract between the plaintiff and a third party; The defendant's knowledge of the contract; The defendant's intentional interference with the contract; Causation; Damages.
118
Intentional Interference with Contractual Relations - Effect
The defendant is liable for damages caused by the interference.
