Chapter 10 exam 3 Flashcards
value given in return for a promise or performance in a contractual agreement
consideration
consideration is broken down into two parts:
- something of legally sufficient value must be given in exchange for the promise
- there must be a bargained-for exchange
consideration must be something of value in the eyes of the law
this is to be legally sufficient
to be something of legally sufficient value
- promise to do something that one has no prior legal duty to do
- performance of an action that one is otherwise not obligated to undertake
- refraining from an action that one has a legal right to undertake
“how much” consideration is given, the fairness of the bargain
adequacy of consideration
where a contract is canceled and the parties are returned to the position they occupied before the contract was made
Rescission
promises made in return for actions or events that have already taken place are unenforceable
past consideration
terms of contract express such uncertainity of performance that the promisor has not definitely promised to do anything, the promise is said to be
illlusory
a debitor offers to pay, creditor accepts, a lessor amount than the creditor originally claimed was owed
accord and satisfaction
the agreement under which one of the parties promises to give or perform and the other to accept
accord
performance (usually payment) which takes place after the accord is executed
satisfaction
if debt is liquidated then accord and satisfaction….
cannot take place
whose amount has been ascertained, fixed, agreed on, settled or exactly determined
liquidated debt
the amount of the debt is not settled, agreed on, ascertained or determined
unliqudated debt
where one party forfeits the right to pursue a legal claim against another party/ “i am given up my right to pursue an action”
release
releases will generally be binding if they are:
1.given in good faith
2. stated in signed writing
3. accompanied by consideration
an agreement to substitute a contractual obligation for some other type of legal action based on a valid claim
covenant not to sue
a person who has reasonably and substantially relied on the promise of another can obtain some measure or recovery
promissory estoppel
barred or prevented
estopped
legal ability to enter into a contractual relationship
contractual capacity
in regards to minors, the act of being freed from parental control
emancipation
legal avoidance, or setting aside, of a contractual obligation is (minors)
disaffirmance
to disaffirm a minor must express, through words or conduct, his or her intent not to be
bound to the contract
include whatever is reasonably needed to maintain the minors standard of living
necessaries
acceptance or confirmation of an act or agreement that gives legal force to an obligation that previously was not enforceable
ratification
occurs when the individual, on reaching the age of majority, states orally or in writing that they intends to be bound by the contrat
express ratification
takes place when the minor, on reaching the age of majority, behaves in a manner inconsistent with disaffirmance
implied ratification
contract entered into by an intoxicated person can either be ___ or ___
voidable or vlaid (enforceable)
contracts made by mentally incompetent persons can be ____,___or ____
void, voiable, or valid
for a contract to be valid and enforceable, it must be formed for a
legal purpose
charging an illegal rate of interest
usury
contractual promise of one party to refrain from conducting business similar to that of another party for a certain period of time and within a specified geographical area
covenant not to compete
court-ordered correction of a written contract so that it reflects the true intentions of the parties
reformation
which the terms of the agreement are so unscrupulous or grossly unfair as to be “ void of conscience”
unconscionable contract or clause
a contract can be unconscionable on either ____ or _____
procedural, substantive
often involves inconscpicuous print, unintelliigible language or ones party’s lack of opportunity to read the contract or ask questions about its meaning
procedural unconscionability
standard-form contract in which the stronger party dictates the terms
adhesion contract
occurs when contracts or portions of contracts are oppressive or overly harsh
substantive unconscionability
release a party from liability in the event of monetary or physical injury no matter who is at fault
exculpatory clauses
state laws that regulate the offering and sale of securities for the protection of the public
blue sky laws
An agreement between the lender and the borrower. It involves the lender agreeing to temporarily stop requiring mortgage payments, delay foreclosure proceedings, or accept smaller payments than originally scheduled. This is often done to provide relief to borrowers facing financial hardship, allowing them some breathing room to manage their finances during difficult times.
Forbearance
discretionary (illusory promise) means “i hope I could give u a big bonus” but this is not
promised
for the doctrine of promissory estoppel to be applied, whatre 5 requirements:
- there must be a clear and definite promise
- promisor reasonably relied on the promise by acting or refraining from some act
- the promisor should have expected that the promise would rely on the promise
- the promisee’s reliance was definite and resulted in substantial detriment
5.Enforcement of the promise is necessary to avoid injustice
some people who are incompetent due to ae or illness gave lucid intervals- temporary periods of sufficient intelligence, judgment, and will
so a contract will still be valid
do a deal with an unlicensed person, do I have to pay them?
typically the contract involving an unlicensed practitioner generally is illegal and unenforceable
