Chapter Ten Flashcards
Voluntary Consent
The knowing and voluntary agreement to the terms of a contract. If a contract is formed as a result of a mistake, misrepresentation, undue influence, or duress, voluntary consent is lacking and the contract will be voidable
bilateral mistake
a mistake that occurs when both parties to a contract are mistaken about the same material fact
unilateral mistake
a mistake that occurs when one party to a contract is mistaken as to a material of fact
scienter
know
statute of frauds
a state statute under which certain types of contracts must be in writing to be enforceable
assignment
the act of transferring to another all or part of one’s rights arising under a contract
delegation
the transfer of a contractual duty to a third party. the party delegating the duty (the delegator) to the third party (the delegatee) is still being obliged to perform on the contract should the delegatee fail to perfom
third party beneficiary
one for whose benefit a promise is made in a contract but who is not a party to the contract
intended beneficiary
a third party for whose benefit a contract is formed. an inteneded beneficiary can sue the promisor if such a contract is breached.
incidental beneficiary
a third party who incidentally benefits from a contract but whose benefit was not the reason the contract was formed. an incidental beneficiary has no rights in a contract and cannont sue to have the contract enforce
discharge
the termination of an obligation. in contract law, discharge occurs when the parties have fully performed their contractual obligations or when events, conduct of the parties, or operation of law releases the parties from performance
performance
in contract law, the fulfillment of one’s duties arising under a contract with another; the normal way of discharging one’s contractual obligations.
condition
a qualification, provision or clause in a contractual agreement, the occurrence or nonoccurence of which creates, suspends, or terminates the obligations of the contracting parties
condition precedent
in a contractual agreement, a condition that must be met before a party’s promise becomes absoulte
tender
an unconditional offer to perform an obligation by a person who is ready, willing, and able to do so
anticipatory repudiation
an assertion or action by a party indicating that he or she will not perform an obligation that the party is contractually obligated to perform at a future time
Mutual rescission
an agreement between the parties to cancel their contract, releasing the parties from further obligations under the contract. The object of the agreement is to restore the parties to the position they would have occupied had no contract ever been formed.
novation
the substitution, by agreement, of a new contract for an old one, with the rights under the old one being terminated. typically, novation involves the substitution of a new party for one of the original parties to the contract
impossibility of performance
a doctrine under which a party to a contract is relieved of his or her duty to perform when performance becomes objectively impossible or totally impractical (through no fault of either party)
commercial impracticability
a doctrine under which a court may excuse the parties from performing a contract when the performance becomes much more difficult or costly due to an event that the parties did not foresee or anticipate at the time the contract was made.
Frustration of purpose
a court-created doctrine under which a party to a contract will be relieved of his or her duty to perform when the objective purpose for performance no longer exists due to reasons beyond that party’s control
consequential damages
special damages that compensate for a loss that does not directly or immediately result form the breach (for example, lost profits). For the plaintiff to collect consequential damages, they must have been reasonably foreseeable
Mitigation of damages
a rule requiring a plaintiff to do whatever is reasonable to minimize the damages caused by the defendant
liquidated damages
an amount, stipulated in a contract, that the parties to the contract believe to be a reasonable estimate of the damages that will occur in the event of a breach
penalty
a contractual clause that states that a certain amount of monetary damages will be paid in the event of a future default or breach of contract. the damages are a punishment for a default and not an accurate measure of compensation for the contract’s breach. The agreement as to the penalty amount will not be enforced, and recovery will be limited to actual damages
restitution
an equitable remedy under which a person is restored to his or her original position prior to loss or injury, or placed in the position he or she would have been in had the breach not occured
specific performance
an equitable remedy requiring exactly the perfomance that was specified in a contract; usually granted only when money damages would be an inadequate remedy and the subject matter of the contract is unique (for example, real property)
reformation
a court-ordered correction of a written contract so that it reflects the true intentions of the parties
Quasi contract
a fictional contract imposed on parties by a court in the interests of fairness and justice; usually imposed to avoid the unjust enrichment of one party at the expense of another
UCC
is a statutory law; article of the UCC governs the sale of goods and article 2A cover the lease of goods
Merchants
deals in the kind involved in the contract. holds himself or herself out as “having knowledge, and skills unique to the practices or goods involved,” or employs a merchant as a broker or agent.
Goods
the item involved is tangible and movable
goods don’t cover
services or real estate, money, copy rights, patents, stocks, or bonds.
goods may cover
things that can be “separated” from real property. -minerals, crops, ect.
sale of goods
means title passes from the seller to the buyer for a price
UCC article 2
covers the sale of goods
