CONTRACT

Question 1

COMMON LAW CONTRACT

Answer 1

Under common law, a contract is a legally enforceable agreement. In most instances, contract formation requires a bargain in which there is a manifestation of mutual assent to the exchange and also consideration. A valid contract is formed when there is an offer, an acceptance, and consideration.

Question 2

UCC CONTRACT

Answer 2

Under the UCC, a contract is a total legal obligation that results from the parties’ agreement. In most instances, contract formation requires a bargain in which there is a manifestation of mutual assent to the exchange and also manifestation. A valid contract is formed when there is an offer, an acceptance, and consideration.

Question 3

OFFER

Answer 3

Under common law, an offer is a manifestation of the present contractual intent, communicated to an identified offeree, containing definite and certain terms.

Question 4

COMMON LAW OPTION CONTRACT

Answer 4

Under common law, an option contract is a promise that meets the requirements of a valid contract and limits the promisor’s power to revoke the offer. Under common law, separate consideration must be given for the option to be effective.

Question 5

UCC FIRM OFFER RULE

Answer 5

Under the UCC, an offer by a merchant to buy or sell goods in a signed record that gives assurance that it will be held open is irrevocable, even without consideration during the time stated or, if no time stated, for a reasonable time, but for no longer than three months.

Question 6

COUNTEROFFER

Answer 6

Under common law, a counteroffer is an offer made by an offeree to the offeror that relates to the same matter as the original offer, but proposes different terms.

Question 7

ACCEPTANCE

Answer 7

Under common law, an acceptance is a manifestation of assent to the terms of an offer in the manner authorized by the offer. The accepted terms must mirror the terms of the offer for a valid acceptance under common law.

Question 8

UCC BATTLE OF THE FORMS - If at least one party is not a merchant

Answer 8

Under the UCC, a definite and seasonable expression of acceptance in a record operates as acceptance, even if the acceptance contains new or different terms. If at least one party to a contract is not a merchant, additional or different terms are viewed as proposals to modify the contract. Additional or different terms do not become part of the contract unless the offeror agrees.

Question 9

UCC BATTLE OF THE FORMS - If both parties are merchants

Answer 9

Under the UCC, a definite and seasonable expression of acceptance in a record operates as acceptance, even if the acceptance contains new or different terms. If both parties to a contract are merchants, additional terms will be incorporated into the contract unless: (1) the other party objects to the new terms within a reasonable time, (2) the terms materially alter the contract or, (3) the offer expressly limits acceptance to the exact terms of the offer.

Question 10

CONSIDERATION

Answer 10

Under common law, consideration is a bargained-for legal detriment.