CH16 Business Law by Beatty Samuelson Abril 8th Edition Flashcards
CH16 What was a deed called in the 1700’s?
A patent.
P 389
CH16 What was the purpose of the Statute of Frauds?
To provide the courts the best possible evidence of whether the parties intended to make a contract.
To provide the court the best possible evidence of the parties’ intentions.
P 390
CH16 What 6 types of agreements must be in writing? (Statute of Frauds) (6)
Transfer of land.
That cannot be performed in one year.
In which a party promises to pay the debt of another.
Made by an executor of an estate to pay a debt of the estate.
Made in consideration of marriage.
For the sale of goods of $500 or more.
P 390
CH16 What is required for a contract to be enforced (Statue of Frauds)?
Of the six types of Statute of Frauds agreements, the agreement or a memorandum of the agreement, is:
in writing
signed by the defendant.
P 390
CH16 What is an executory contract?
One where the parties have not fulfilled their obligations.
P 390
CH16 What if a fully executed contract is not in writing?
It makes no difference, the contract, once fully executed, is not illegal. Neither party may then demand recission.
P 390
CH16 Which does the Statute of Frauds allow?
A party to cancel future obligations.
A party to cancel past obligations.
Both.
Neither.
The party may cancel future obligations. Past, completed obligations may not be undone.
P 390
CH16 Define the following contracts:
Valid
Unenforceable
Voidable
Void
Valid - satisfies all of the law’s requirements. Offer, acceptance, consideration, legality, capacity, consent, writing. p 281
Unenforceable - the court declares that the rule of law prevents enforcing the contract.
Voidable - when the law permits one party to terminate the agreement.
Void - neither party can enforce the contract. Often illegal purpose or one party has no legal authority.
P 285
CH16 What does interest in land mean?
Any legal right regarding land.
P 390
CH16 Name 4 interests in land.
Any legal right regarding land:
A house on a lot.
A mortgage.
An easement.
A leased apartment.
P 390
CH16 What is the length of a short term lease?
One year or less.
P 390
CH16 What is a cooperative?
What is the result of a cooperative?
A cooperative apartment is an interest in land.
A lease may be in one person’s name, but if the other person(s) split all expenses it becomes a cooperative.
Each tenant has the option of buying the property.
P 390-391
CH16 What is an easement?
Does it require a written contract?
An easement is a legal right that an owner gives to another person to make some use of the owner’s land.
Yes, it requires a written contract to be enforceable.
P 391
CH16 Name three exceptions to an oral contract regarding an interest in land that should have been in writing.
Exception: Full performance by the seller.
Exception: Partial performance by the buyer. If the buyer paid part of the price and either entered upon the land or made improvements to it.
Exception: Promissory Estoppel. If a promisor makes an oral promise that should reasonable cause the promisee to rely on it, and the promisee does rely, the promisee may be able to enforce the promise. see 289-91, 337-8, 334, 459-61, 392.
P 392
CH16 What are the 3 conditions of Promissory Estoppel?
The defendant made a promise knowing the plaintiff would likely rely on it.
The plaintiff did rely on the promise.
The only way to avoid injustice is to enforce the promise.
P 290
CH16 Contracts that cannot be performed within one year are unenforceable unless:
Under what condition could it be enforceable?
If a contract will necessarily take more than a year to finish, it:
They are in writing.
If the contract could possibly be completed within one year.
Must be in writing.
P 392
CH16 If you hire a band to play at your wedding 15 months from when the arrangement was made with the band, the contract must be:
In writing. It is more than 12 months from now.
P 393
CH16 Two people agree to buy lottery tickets together and evenly share the winnings if they win. They win the lottery a number of years after they make this agreement. The person who had bought the ticket tried to claim all of the money for themselves. This went to court. Who won and why?
Statute of Frauds states that the contract must have the ability to be satisfied in a year.
They could possibly have won in the first year.
Therefore the Statute of Frauds does not apply, the person holding the winnings must pay the other.
P 393
CH16 What is a Collateral Promise?
How is it enforceable?
It must be in writing to be enforceable.
P 394
CH16 Exception: What is the Leading Object Rule?
When the promisor guarantees to pay the debt of another and the leading object of the promise is some benefit to the
promisor himself, then the contract will be enforceable even if unwritten.
It the leading object of a promise was based on self-interest, an oral promise is fully enforceable.
P 394
CH16 Exception: Promise Made by an Executor of an Estate. What does the statute of frauds state in regards to the executor
paying estate debt with their own funds?
An executor’s promise to use her own funds to pay a debt of the deceased must be in writing to be enforceable.
P 395
CH16 Promise Made in Consideration of Marriage. What is required of this type of promise?
It must be made in writing to be enforceable.
P 395
CH16 The Common Law Statute of Frauds - What is a “writing?” (6)
The contract may be formal or informal.
It must be in writing.
It must be signed by the defendant.
It must state with reasonable certainty the name of each party,
the subject matter of the agreement
and all of the essential terms and promises.
P 395
CH16 Explain a Signature.
A state’s Statute of Frauds typically requires that the writing be signed by the party to be charged therewith.
The party to be charged therewith is the party who is resisting the contract.
Judges tend to define signature very broadly.
It can be signed with a pen or a stamp.
Electronic signature.
P 396
CH16 What is Reasonable Certainty? (3) plus see the (7) on page 396.
In the case of informal memoranda, the memo must be certain and complete.
All of the necessary details must be in it to be a formal agreement.
It must not be vague or incomplete. It must be clear and complete.
See page 281 for the 7 key characteristics of a contract.
Remember that per the Statute of Frauds contracts must be in writing if the agreed upon term is over one year.
P 396
CH16 UCC Uniform Commercial Code contracts only involves:
the sale of goods.
P 398
CH16 UCC code is easier to meet than
common law.
P 398
CH16 What are the 3 elements of UCC code Statute of Frauds?
The basic rule
The merchants exception
Special circumstances
P 398
CH16 What does the UCC code not require in a contract that common law does require?
It does not require all of the terms of the agreement be in writing.
P 398
CH16 What is the UCC Code looking for in a contract?
That there is an indication that the parties reached an agreement.
P 398
CH16 What two things are required to be in a UCC code $500 or more contract?
The signature of the defendant and the quantity of goods being sold.
P 398
CH16 Merchants Exception:
Within a reasonable time of making an oral contract,
if a merchant sends a written confirmation to another,
and if the confirmation is definite enough to bind the sender herself,
then the merchant who receives the confirmation is definite enough to bind the sender herself,
then the merchant who receives the confirmation will also be bound by it
unless he objects in writing within ten days.
P 400
CH16 UCC Code Merchant’s Exception: What can a writing create?
a binding contract even when it is not signed by the defendant.
P 400
CH16 UCC Contract Special Circumstances:
An oral contract may be enforceable, even without a written memorandum if:
The seller is specially manufacturing the goods for the buyer
The defendant admits in court proceedings that there was a contract
The goods have been delivered or they have been paid for
P 400
CH16 UCC fact:
If the seller has delivered the goods or the buyer has paid for them,
the contract may be enforced even with nothing in writing.
CH16 Parol Evidence Rule:
When two parties make an integrated contract,
neither one may use parol evidence to contradict, vary or add to its terms.
P 402
CH16 Exception: An Incomplete or Ambiguous Contract
If a court determines that a written contract is incomplete or ambiguous, it will permit parol evidence.
CH16 Exception: Fraud, Misrepresentation or Duress
A court will permit parol evidence of fraud, misrepresentation or duress.
P 403
