Chapter 10- Nature And Terminology

Question 0

Contract

Answer 0

A promise or a set of promises for the breach of which the law gives a remedy, or the performance of which the law in some way recognizes as a duty. A legally binding agreement.

Question 1

Bilateral contract

Answer 1

“A promise for a promise”. A type of contract that arises when a promise is given in exchange for a return promise.

Question 2

Executed contract

Answer 2

A contract that has been fully performed on both sides

Question 3

Executory contract

Answer 3

A contract that has not been fully performed by the parties

Question 4

Express contract

Answer 4

The terms of the agreement are fully and explicitly stated in words, oral or written.

Question 5

Formal contract

Answer 5

Contracts that require a special form or method of creation (formation) to be enforceable.

Question 6

Implied in fact contract

Answer 6

A contract that is implied from the conduct of parties. The conduct or actions of the party, rather than words, creates and defines the terms of the contract.

Question 7

Informal contract

Answer 7

Also called simple contracts, is a contract that does not require a specialized form or formality in order to be valid.

Question 8

Objective theory of contracts

Answer 8

A theory under which the intent to form a contract will be judged by outward, objective facts (what the party said when entering into the contract, how the party acted or appeared, and the circumstances surrounding the transaction) as interpreted by a reasonable person, rather than by the party’s own secret, subjective intentions.

Question 9

Offeree

Answer 9

The party to whom the offer is made

Question 10

Offeror

Answer 10

The party making the offer

Question 11

Promise

Answer 11

A persons assurance that the person will or will not do something about

Question 12

Promisee

Answer 12

The one whom the promise was made

Question 13

Promisor

Answer 13

The one making the promise

Question 14

Quantum meruit

Answer 14

Latin meaning “as much as he or she deserves. Essential describes the extent of compensation owned under a contract implied in law.

Question 15

Quasi contract

Answer 15

Contracts implied in law, are not actual contracts. Fictional contracts created by courts and imposed on parties in the interests of fairness and justice.

Question 16

Unenforceable contract

Answer 16

A contract that cannot be enforces because of certain legal defenses against it.

Question 17

Unilateral contract

Answer 17

“A promise for an act”. A contract that results when an offer can only be accepted by the offeree’s contract.

Question 18

Valid contract

Answer 18

Has the elements necessary to entitle at least one of the parties to enforce it in court.

Question 19

Void contract

Answer 19

No contract at all. No contract at all or there is a contract without legal obligations.

Question 20

Voidable contract

Answer 20

One party has the option of avoiding or enforcing the contractual obligation.

Question 21

Sources of contract law

Answer 21

Common law governs all contacts except when it has been modified or replaced by statutory law. I.e. UCC, administrative agency regulations.

Contracts relating to services, real estate, employment, insurance- COMMON LAW

sale and lease of goods- UCC

Question 22

Function of contract law

Answer 22

The formation and enforcement of agreements between parties.

In latin: pacta sunt servanda = “agreements shall be kept”

Question 23

Requirements of a valid contract

Answer 23

1. Agreement: includes offer and acceptance
2. Consideration: promises made by the parties to the contract must be supported by by legally supported and bargained for consideration
3. Contractual capacity: the law must recognize them as possessing characteristics that qualify them as competent
4. Legality: must accomplish a legal goal

Question 24

Defenses to the enforceability of a contract

Answer 24

1. Genuineness of assent: the consent of both parties must be genuine. (Fraud, undue influence, mistake, duress) 2. Form: must be in whatever form the law requires. I.e. Some must be in writing

Question 25

Plain meaning rule

Answer 25

When a contracts writing is clear and unequivocal, a court will enforce it according to its obvious terms. The meaning of the terms must be determined from the face of the instrument- from the written document alone

Question 26

Extrinsic evidence

Answer 26

Any evidence not contained in the document itself.