Chapters 13-15

Question 1

parol evidence rule

Answer 1

the rule that any spoken or written words in conflict with what the written contract states cannot be introduced as evidence in a court of law

Question 2

Statute of Frauds

Answer 2

a law requiring certain contracts to be in writing to be enforceable

Question 3

executor

Answer 3

a personal representative named in a will to handle matters involving the estate of a deceased person

Question 4

administrator

Answer 4

a personal representative named by the court to perform as the executor would in instances in which the deceased person has not left a will

Question 5

guaranty

Answer 5

a promise to pay the debts or settle the wrongdoings of another if he or she does not make settlement personally

Question 6

antenuptial/prenuptial agreement

Answer 6

an exchange of promises made by persons planning to marry

Question 7

auction sale

Answer 7

a sale in which goods are sold to the highest bidder

Question 8

memorandum

Answer 8

a written contract or agreement

Question 9

third party beneficiary

Answer 9

a person who is not a party to a contract but is intended by the contracting parties to benefit as a consequence of a contract

Question 10

incidental beneficiary

Answer 10

a person who will benefit as an indirect consequence of a contract, although that was not the intent of the contracting parties

Question 11

assignment

Answer 11

the transfer of a contract right to a third party who can receive the benefits of the contract

Question 12

assignor

Answer 12

the person who transfers his or her rights in an assignment

Question 13

assignee

Answer 13

the third party to whom rights are transferred in an assignment

Question 14

guarantor

Answer 14

the party who guarantees the promises assigned

Question 15

personal service contract

Answer 15

a contract in which services that require a unique skill, talent, ability, and so forth are provided by a specific person

Question 16

delegation

Answer 16

the appointment of a third party by a party to an existing contract to perform contractual duties that do not involve unique skills, talents, abilities, and so on

Question 17

bankruptcy

Answer 17

a condition in which a person or business is legally recognized as unable to pay legitimate debts

Question 18

novation

Answer 18

a situation in which all parties to a contract agree to a significant change to a contract

Question 19

substantial performance

Answer 19

when a party to a contract, in good faith, executes all of the promised terms and conditions of the contract with the exception of minor details that do not affect the real intent of their agreement

Question 20

tender of performance

Answer 20

an offer to perform that is considered evidence of a party’s willingness to fulfill the terms of a contract

Question 21

tender of goods

Answer 21

an offer to provide the goods agreed upon that is considered evidence of a party’s willingness to fulfill the terms of a contract

Question 22

tender of payment

Answer 22

a money offer of payment of an obligation

Question 23

impossibility of performance

Answer 23

when unforeseen circumstances make it impossible to fulfill the terms of a contract; in these cases, the contract is considered void

Question 24

frustration of purpose

Answer 24

a doctrine that states that where both parties know the purpose of a contract and, through no fault of either party, the reason for the contract no longer exists, the contract is terminated

Question 25

material alteration

Answer 25

a deliberate change or alteration of an important element in a written contract that affects the rights or obligations of the parties

Question 26

breach of contract

Answer 26

when a party to a contract refuses to perform as required by the contract or performs in an unsatisfactory manner

Question 27

anticipatory breach

Answer 27

when a party to a contract announces his or her intention to break the contract in the future

Question 28

mitigate

Answer 28

the obligations of the injured party to protect the other party from an unnecessary damages

Question 29

promissory note

Answer 29

a written promise to pay a specified sum of money

Question 30

liquidated damages clause

Answer 30

a statement wherein damages are explicitly set in the event one of the parties breaches an agreement

Question 31

specific performance

Answer 31

a court order directing a person to perform or not perform as he or she agreed to do in a contract

Question 32

restraining order

Answer 32

a court order prohibiting the performance of a certain act. In some states, a restraining order is temporary.

Question 33

injunction

Answer 33

a permanent court order prohibiting the performance of a certain act