Chapter 9 - Introduction To Contracts

Question 1

What are the 7 parts of a contract that must be in place have a legal contract?

Answer 1

• Offer
• Acceptance
• Consideration
• Legality
• Capacity
• Consent
• Writing

Question 2

What is an Offer?

Answer 2

In contract law, an act of statement that proposes definite terms and permits the other party to create a contract by accepting those terms

Question 3

What is Acceptance?

Answer 3

Once a party receives an offer, he must respond to it in a certain way.

Question 4

What is Consideration?

Answer 4

In contract law, something of legal value that has been bargained for and given in exchange by the parties.

Question 5

What is Legality?

Answer 5

The contract must be for a lawful purpose.

Question 6

What is Capacity?

Answer 6

The legal ability to enter into a contract.

Question 7

What is Consent?

Answer 7

Certain kinds of trickery and force can prevent the formation of a contract

Question 8

What is Writing?

Answer 8

Some types of contracts must be in writing to be enforceable.

Question 9

What is a contract?

Answer 9

A legally enforceable agreement.

A promise that the law will enforce

Question 10

What is a Bilateral Contract?

Answer 10

A contract where both parties make a promise

Question 11

What is a Unilateral Contract?

Answer 11

A contract where one party makes a promise that the other party can accept only by doing something

Question 12

What is an Executory Contract?

Answer 12

A binding agreement in which one or more of the parties has not fulfilled its obligations

Question 13

What is an Executed Contract?

Answer 13

An agreement in which all parties have fulfilled their obligation

Question 14

What is a Valid Contract?

Answer 14

A contract that satisfies all of the law’s requirements

Question 15

What is an Unenforceable Contract?

Answer 15

A contract where the parties intent to form a valid bargain but a court declares that some rule of law prevents enforcing it.

Question 16

What is a Voidable Contract?

Answer 16

An agreement that, because of some defect, may be terminated by one party, such as a minor, but not by both parties.

Question 17

What is a Void Agreement?

Answer 17

An agreement that neither party may legally enforce.

Question 18

What is an Express Contract?

Answer 18

An agreement with all important terms explicitly stated

Question 19

What is an Implied Contract?

Answer 19

A contract where the words and conduct of the parties indicate that they intended an agreement.

Question 20

What is Promissory Estoppel?

Answer 20

A doctrine in which a court may enforce a promise made by the defendant even when there is no contract.
-The defendant made a promise that the plaintiff relied on.

Question 21

What is a Quasi-Contract?

Answer 21

A legal fiction in which, to avoid injustice, the court awards damages as if a contract had existed, although one did not.
-The defendant did not make any promise, but did receive a benefit from the plaintiff.

Question 22

What is Quantum Maruit?

Answer 22

“As much as he deserved” The damages awarded in a quasi-contract case.

Question 23

What are Goods?

Answer 23

Are things that are movable, other than money and investment securities.

Question 24

Which 4 parts of contract law came from Common Law?

Answer 24

Express Contracts
Implied Contracts
Promissory Estoppel
Quasi-Contract

Question 25

What is the UCC?

Answer 25

Uniform Commercial Code - a set of laws for business transactions so they are the same across all the states (Most so far)

Question 26

What does the UCC govern compared to common law?

Answer 26

The UCC governs the sale of goods while common law principles govern contracts for sales of services and everything else..

Question 27

If a contract involves both the sale of goods and service, how do you determine whether to go by the UCC or Common Law?

Answer 27

When you have the sale of goods and services, Article 2 of the UCC governs only if the primary purpose was the sale of goods.

Question 28

What is an Offeror?

Answer 28

The party in contract negotiations who makes the first offer.

Question 29

What is an Offeree?

Answer 29

The party in the contract negotiations who receives the first offer.

Question 30

What must have happened for a Meeting of the Minds to have taken place?

Answer 30

One side must make an offer and the other must make an acceptance.

Question 31

What is a Revocation?

Answer 31

When an offer is revoked when the offeror "takes it back" before the offeree accepts.

Question 32

What is a Rejection?

Answer 32

If an offeree clearly indicates that he does not want the offer,then he has rejected it. A rejection immediately terminates the offer.

Question 33

What is a counteroffer?

Answer 33

When a party responds to an offer with a new a different proposal. A counteroffer is a rejection of the previous offer.

Question 34

What is the Mirror Image Rule?

Answer 34

A contract doctrine that requires acceptance to be on exactly the same terms as the offer. Otherwise it is counted as a counteroffer and is a rejection of the initial offer.

Question 35

When will an acceptance that adds additional or different terms create a contract?

Answer 35

Under the UCC and the battle of the forms, acceptance that adds additional and different terms will create a contract. And the additional items will often become part of the contract.

Question 36

When are the major 4 specifics on when the mirror image rule is ignored under the UCC?

Answer 36

- For the sale of goods, the most important factor is whether the parties believe they have a binding agreement. If their conduct indicates that they have a deal, they probably do. - If the offeree adds new terms to the offer, acceptance by the offeror generally creates a binding agreement - If the offeree changes the terms of the offer, a court will probably rely on the general principles of the UCC to create a fair contract. - If a party wants a contract on its terms only, with no changes, it must clearly indicate that.

Question 37

When is the effective date of an acceptance?

Answer 37

An acceptance is generally effective upon dispatch, meaning the moment it is out of the offeree's control.

Question 38

What is the effective date of a termination?

Answer 38

Terminations take effect on the date they are received.