Chapter 10 Flashcards
bilateral
contract
contract where both parties
make promises and
undertake obligations to
each other, creating
reciprocal rights and duties.
consideration
Something of value
exchanged between parties
to a contract
contract
agreement between two
or more parties that creates
legal obligations and can be
enforced by law.
counteroffer
response to an offer that
modifies the terms or
conditions, rejecting the
original offer and creating a
new proposal.
executory
contract
contract where one or both
parties have not yet fulfilled
their obligations or
performed their promises
express
warranty
Terms of a contract that are
explicitly stated by the
parties, either orally or in
writing.
implied
warranty
Terms of a contract that are
not explicitly stated but are
inferred from the
circumstances or the parties’
conduct
offer and
acceptance
basic elements of a
contract where one party (the
offeror) makes a proposal or
promise to another party (the
offeree), who accepts the
offer, creating a binding
agreement
rescission
cancellation or
annulment of a contract,
returning the parties to their
pre-contractual positions
and releasing them from
further obligations
statute of
frauds
legal rule requiring certain
types of contracts to be in
writing to be enforceable
unenforceable
contract that cannot be
enforced by a court because
it lacks certain legal
requirements or violates
public policy
unilateral
contract
contract where only one
party makes a promise or
undertakes an obligation,
and the other party is not
required to perform unless
they choose to do so
valid
contract that meets all
legal requirements and is
enforceable by law.
void
contract that is considered
invalid and has no legal effect
from the beginning.
voidable
contract that is valid but
can be rescinded or canceled
by one of the parties due to
legal reasons, such as fraud,
duress, or incapacity.
A buyer submits an offer to a seller and then dies in a car accident. Before learning of the buyer’s death, the seller accepts the offer. Which of the following is true?
The buyer’s death terminated the offer
What actions or circumstances can terminate an offer?
acceptance, rejection, recovation, lapse of time, counteroffer, death, insanity
A party sells a summer cottage appraised at $300,000 to a stranger for $150,000. The seller’s family wants to challenge the validity of the sale contract. The most apparent weakness of the contract that they might be able to attack is the
insufficiency of the consideration exchanged for the property
An unscrupulous investor completes a contract with a buyer to sell a property the investor does not own. The sale contract for this transaction
is void
The necessary condition of mutual consent may be found lacking in a contract if
the offer which was accepted is vague
As part of a construction contract between a contractor and a buyer, the contractor promises to complete construction by November 20. This promise can be construed as
valuable consideration
Valuable consideration
something of tangible value, such as money, or something a party promises to do or not do
An important legal feature of a contract is
it represents a “meeting of the minds.”
A bilateral contract is one in which
both parties promise to do something in exchange for the other party’s performance
According to contract law, every valid contract is also
enforceable or unenforceable
A contract is discharged whenever
it is performed
How much time does a seller have to accept a buyer’s offer?
A “reasonable” time, or until the expiration date on the offer
A homeseller signs a listing agreement with a broker and the next week decides not to sell and revokes the listing. Which of the following is true?
The broker may have a claim for damages
A landlord suddenly terminates a tenant’s lease in violation of the lease terms. The tenant takes action to compel the landlord to comply with the violated terms. This is an example of a suit for
specific performance
suit for specific performance
an attempt to force the defaulting party to comply with the terms of the contract
A contract that conveys an interest in real estate must
contain a legal description of the property
A homeowner encourages an agent to aggressively persuade a buyer to purchase his house by overinflating historical appreciation rates. The agent and the seller agree that 25% annual appreciation would work, even though this figure is four times actual rates. The pitch succeeds, and the seller accepts the buyer’s resulting offer. This contract is
voidable
