Chapter 11

Question 1

Promisor

Answer 1

A person who makes a promise

Question 2

Promisee

Answer 2

A person to whom a promise is made

Question 3

Contract

Answer 3

An agreement that can be enforced in court; formed by two or more parties, each of whom agrees to perform or to refrain from performing some act now or in the future

Question 4

Objective theory of contracts

Answer 4

A theory under which the intent to form a contract will be judged by outward, objective facts (what the party said when entering 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 5

Requirements of a valid contract

Answer 5

Agreement
Consideration
Contractual capacity
Legality

Question 6

Defenses to the enforceability of a contract

Answer 6

Voluntary consent

Form

Question 7

What governs all contracts

Answer 7

Common law except when it has been modified or replaced by statutory law or administrative agency regulations
- (usually for the sale and lease of goods)

Question 8

Offeror

Answer 8

A person who makes an offer

Question 9

Offeree

Answer 9

A person to whom an offer is made

Question 10

Bilateral contract

Answer 10

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

Question 11

Unilateral contract

Answer 11

A contract that results when an offer can only be accepted by the offeree’s performance
“A promise for an act”
- contests, lotteries, etc

Question 12

Formal contracts

Answer 12

A contract that by law requires a specific form, such as being executed under seal to be valid
- negotiable instruments (checks, drafts, promissory notes, bills of exchange, certificates of deposit)

Question 13

Informal contracts

Answer 13

A contract that does not require a specified form or formality in order to be valid

Question 14

Express contract

Answer 14

A contract in which the terms of the agreement are fully and explicitly states in words, oral or written.
- signed lease for a house

Question 15

Implied contract

Answer 15

A contract formed in whole or in part from the conduct of the parties (as opposed to an express contract)

• also known as implied in fact contract
  1. Plaintiff furnished some service/property
  2. Plaintiff expected to be paid for it and the defendant knew that payment was expected
  3. Defendant had a chance to reject the services/property and did not

Question 16

Executed contract

Answer 16

A contract that has been completely performed by both parties

Question 17

Executory contract

Answer 17

A contract that has not yet been fully performed

Question 18

Valid contract

Answer 18

Results when elements necessary for contract formation are present

Question 19

Voidable contract

Answer 19

A contract that may be legally avoided (cancelled or annulled) at the option of one of the parties

Question 20

Unenforceable contract

Answer 20

A valid contract rendered unenforceable by some statute or law

Question 21

Void contract

Answer 21

A contract having no legal force or binding effect

Question 22

Quasi contracts

Answer 22

A fictional contract imposed on parties by a court in the interests of fairness and justice; usually, quasi contracts are imposed to avoid the unjust enrichment of one party at the expense of another
“As if”

Question 23

Quantum merit

Answer 23

“As much as he deserves”

• an expression describing the extent of liability on a contract implied in law. An equitable doctrine based on the concept that one who benefits from another’s labor and materials should not be unjustly enriched thereby but should be required to pay a reasonable amount for the benefits received, even absent a contract

Question 24

Plain meaning rule

Answer 24

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 25

A contract is ambiguous when

Answer 25

1. The intent cannot be determined from the contracts language
2. It lacks provision on a disputed term
3. A term is susceptible to more than one interpretation
4. There is uncertainty about a provision

Question 26

Extrinsic evidence

Answer 26

Evidence that relates to a contract but is not contained within the document itself, such as the testimony of parties/witnesses or additional agreements or communications.
- only considered when a contract is ambiguous

Question 27

Offeror

Answer 27

The party making the offer

Question 28

Offeree

Answer 28

A person to whom an offer is made

Question 29

Bilateral contract

Answer 29

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