Chapter 7 Flashcards
Express contract
Parties have an oral or written contract
Implied contract
Inferred by law, based on the conduct of the parties such as a handshake
Voidable contract
One party, but not the other has the right to escape from it’s legal obligations under the contract
Executed contract
One that has met all terms and obligations of the parties to the contract
Enforceable contract
One that is valid, legally binding in which one party breaches it, the other will have an appropriate legal remedy
Elements of a contract
- Offer/communication - promise of one party to do or not do something if the other party agrees to do or not do something
- Consideration - to give up something of value in exchange for something of value
- Acceptance - formally accept an offer
Acceptance involves 4 criteria:
- Meeting of the minds
- Definite and complete
- Duration
- Complete and confirming
Breach of a contract involves 4 criteria:
- A valid contract was executed
- The plaintiff performed as specified in the contract
- The defendant failed to perform as specified
- The plaintiff suffered economic loss from the breach
Corporate contracts
Limited by what is contained in the articles of the incorporation/charter
Concept of apparent authority
Appearance of being the agent of another (employer or principle) with the power to act for the principal
Agent
One who has the power to contract for and bind another person to the contract
Condition
Event that must happen by one party or before the other party has any responsibility to perform under the contract (express/implied)
Performance
The act of doing what is required by the contract
Contract fraud
When at least one part in a contract knowingly misrepresents a material fact contained in the contract and intends that the other party rely on that misrepresentation
Mistakes of fact
Mistaken believe that certain “facts” are true (both parties must have made the mistake)
Mistake of law
Misunderstanding or interpreted the law incorrectly
Duress
Use of unlawful threats or pressure to force an individual to act against their will
Illegal contract
The contract is against the law or contrary to public policy that no court will uphold or enforce it
Statue of limitations
Can be limited from taking legal action if not done so in a timely period
Monetary damages
Awarded in an attempt to restore the aggrieved party the money that it would have had if the other party had not breached the contract
General damages
Those that can be expected to arise from a breach of contract
Consequential damages
Those that occur because of some unexpected, unusual, or strange development involved in the contract
Employment contract
Written document that sets forth the terms of the employment
Sherman Anti-trust Act + Clayton Act
Preventing and eliminating unlawful tying contracts, price discrimination, corporate mergers and acquisitions (to prevent monopoly), and interlocking directorates = maintaining competitive markets!
