Chapter 12: Agreement Flashcards
Agreement is evidenced by two events:
- an offer
- an acceptance
the party making an offer is called the
offeror
the party to whom the offer is made is called the
offeree
Under the common law, what are the three elements necessary for an offer to be effective?
- the offeror must have a serious intention to become bound by the offer
- the terms of the offer must be reasonably certain, or definite, so that the parties and court can ascertain the terms of the contract
- the offer must be communicated to the offeree
A preliminary agreement is binding if:
the parties have agreed on all essential terms and no disputes remain unresolved
The specific terms required in a contract are based on the ________ of contract.
type
Generally, a contract must include what 4 terms?
- Identification of the parties
- The identification of the object or subject matter of the contract (also the quantity, when appropriate), including the work to be performed, with specific identification of such items as goods, services, and land)
- The consideration to be paid
- The time of payment, delivery, or performance.
The power of acceptance that an offeree holds can be terminated by what two things?
- Action of the parties
- Operation of law
An offer can be terminated by action of the parties in any of three ways: revocation, by rejection, or by counteroffer.
by revocation, by rejection, or by counteroffer.
the withdrawal of an offer by an offeror
revocation
unless an offer is _______, the offeror usually can revoke the offer, as long as the revocation is communicated to the offeree before the offeree accepts
irrevocable
in most states, a revocation becomes effective when :
the offeree or offeree’s agent actually receives it
a contract under which the offeror cannot revoke his or her offer for a stipulated time period and the offeree can accept or reject the offer at any time during this period. the offeree must give consideration for the option to be enforceable.
option contract
option contracts are frequently used in conjunction with the sale or lease of:
real estate
an offeree’s response to an offer in which the offeree rejects the original offer and at the same time makes a new offer
counteroffer
a common law rule that requires, for a valid contractual agreement, that the terms of the offeree’s acceptance adhere exactly to the offeror’s offer
mirror image rule
The power of the offeree to transform the offer into a binding legal obligation can be terminated by operation of law through the occurrence of any of the following four events:
- Lapse of Time
- Destruction of the specific subject matter of the offer
- Death or incompetence of the offeror or offeree
- Supervening illegality of the proposed contract
(1) In contract law, the offeree’s notification to the offeror that the offeree agrees to be bound by the terms of the offeror’s proposal. (2) In negotiable instruments law, the drawee’s signed agreement to pay a draft when presented.
acceptance
T or F: Silence can constitute an acceptance when the offeree has had prior dealings with the offeror.
True
Whether the offeror must be notified of the acceptance depends on the:
nature of the contract
The general rule is that acceptance in a bilateral contract is timely if it is:
made before the offer is terminated
a rule providing that an acceptance of an offer becomes effective on dispatch
mailbox rule
e-mail is considered sent when it either leaves the control of the sender or is received by the recipient. What act is this?
Uniform Electronic Transactions Act
When an offeror specifies how acceptance should be made (for instance, by overnight delivery), ________ __________ is said to exist.
express authorization
When is acceptance by a substitute method effective?
When the acceptance is received by the offeror
a contract that is entered into in cyberspace and is evidenced only by electronic impulses (such as those that make up a computer’s memory), rather than, for example, a typewritten form.
e-contracts
a provision in a contract designating the court, jurisdiction, or tribunal that will decide any disputes arising under the contract
forum-selection clause
a clause specifying that any contract dispute will be settled according to the law of a particular jurisdiction, such as a state or country.
choice-of-law clause
an agreement that arises when a buyer, engaging in a transaction on a computer, indicates his or her assent to be bound by the terms of an offer by clicking on a button that says “I agree” or “I accept”
click-on agreement
an agreement whose terms are expressed in a document located inside a box in which goods (usually software) are packaged
shrink-wrap agreement
terms and conditions of use that are presented to an Internet user at the time a product, such as software, is downloaded but that need not be agreed to before the the product is installed or used
browse-wrap terms
an agreement between a seller and buyer who frequently do business with each other on the terms and conditions that will apply to all subsequently formed electronic contracts
a partnering agreement
Two important laws affecting online contracts include:
- the federal Electronic Signatures in Global and National Commerce Act (E-SIGN Act)
- the Uniform Electronic Transactions Act (UETA)
T or F: An e-signature is as valid as a signature on paper
True
What makes an e-signature enforceable?
The contracting parties must have agreed to use electronic signatures.
What act declares that a signature may not be denied legal effect or enforceability solely because it is in electronic form.
The UETA
The UETA covers only electronic records and signatures relating to a ___________.
transaction
T/F: Consideration (think value) is the respect you pay the other person in a contract.
False
T or F: An agreement exists when one party offers a certain bargain to another party.
False
T or F: An expression of opinion can indicate an intent to enter into a binding agreement.
False
T or F: A request to negotiate is an offer.
False
T or F: The power of acceptance continues forever.
False
T or F: In effect, a counteroffer converts the original offeror into an offeree with the power of acceptance.
True
T or F: An offer terminates automatically when the period of time specified in the offer has passed.
True
T or F: An offer can be accepted by the offeree or any third party.
False
T or F: Acceptance may consist of words or conduct.
True
T or F: Acceptance of an e-contract must show that the offeree voluntarily assented to the offer’s terms.
True
Larry advertises a reward for the return of his lost dog. Miguel does not learn of the reward, but finds and returns the dog. With respect to Miguel, Larry’s ad is not an offer because it lacks the element of:
a. communication.
b. none of the choices.
c. serious intent.
d. definite terms
a. communication
Simone offers Tom a dozen guitar lessons for a certain price per lesson but conditions the deal on Tom accepting the offer by April 1. Simone may revoke the offer:
a. only after Tom accepts it.
b. only after April 1.
c. before Tom accepts it.
d. before April 1, whether or not Tom has accepted it.
c. before Tom accepts it.
Coffee Beans Inc. offers to buy Brewing Company’s roasting services for a certain price. Brewing responds that the price is too low and thereby rejects the offer. The offer is:
a. valid until Coffee Beans revokes the offer.
b. terminated.
c. valid for the period of time prescribed by a state statute.
d. valid for a reasonable time.
d. terminated
Gaia tells Franco that she will pay him $50 to haul lawn debris from her property. Franco’s acceptance is complete
a. once he starts to work.
b. only after he hauls away the debris.
c. as soon as he says he will do the job.
d. when he hears the offer.
b. only after he hauls away the debris.
Charter Company offers to provide an air-conditioned bus to Denny’s tour group for $1,500 plus the cost of the fuel. The mailbox rule applies if Denny accepts the offer by
a. e-mail.
b. phone.
c. any of the choices.
d. regular mail.
d. regular mail
Vida, a user of phone-app.com’s website, can download apps for free by first clicking on “I accept” after viewing certain terms. This is
a. a contract that includes the terms.
b. unenforceable.
c. not a contract but the terms are enforceable.
d. a contract that does not include the terms.
a. a contract that includes the terms.
