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MBE > Contracts > Flashcards

Contracts Flashcards

1
Q

Formation

A

Offer, Acceptance, and Consideration

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2
Q

Offer

A

In specific terms, can be revoked or rejected

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3
Q

Revoking is done by

A

The party making the offer

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4
Q

Rejection is done by

A

The party with the power of acceptance (the party who received the offer)

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5
Q

Offers are revocable, unless (6)

A

The party accepts the offer or it is an option contract, a firm offer, a unilateral contract, there is a direct revocation, or an indirect revocation

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6
Q

An option contract is

A

a promise to keep an offer open for a period of time for additional consideration.

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7
Q

Option contracts are between

A

non-merchants

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8
Q

A firm offer is a

A

Promise to keep an offer open for a period of time, no additional consideration required

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9
Q

Firm offers are between

A

1 or more merchants

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10
Q

Firm offers must be

A

in writing

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11
Q

A unilateral contract is a

A

Promise for performance

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12
Q

A unilateral contract is irrevocable

A

Once performance begins

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13
Q

Once performance begins, a unilateral contract is irrevocable, BUT

A

A party cannot demand money if the job is not complete

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14
Q

A Direct revocation happens when

A

One party tells the other party that they have changed their mind

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15
Q

A direct revocation is effective ___

A

immediately

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16
Q

An indirect revocation happens when

A

one of the parties makes a deal with someone else

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17
Q

If there is an indirect revocation, once you find out about it ____

A

you lose power of acceptance

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18
Q

Acceptance is a

A

manifestation of intent to accept

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19
Q

How to accept

A

Any reasonable means that you chose, as long as you express intent to accept

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20
Q

How to accept, exception

A

Any reasonable means, unless manner of acceptance is specified by offering party

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21
Q

Mailbox rule

A

Acceptance is effective when sent

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22
Q

Mailbox rule only applies to

A

parties that are communicating by mail

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23
Q

Exception to the mailbox rule

A

If a rejection was sent prior to a letter of acceptance, whatever letter arrives first is the response to the offer

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24
Q

If acceptance letter was sent before rejection letter, ___

A

Mailbox rule applies and acceptance is effective when sent

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25
Q

Consideration is a

A

bargained-for exchange

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26
Q

Consideration does not have to

A

Match value

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27
Q

Consideration in gift hypos

A

The promise to give a gift is unenforceable consideration

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28
Q

Exception to non-enforceability of gift in hypos

A

If the gift is given, it is enforceable and the gifting party cannot take it back

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29
Q

Past/Moral hypo

A

After you do a good deed, someone offers consideration for it

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30
Q

Past/Moral consideration is

A

Not enforceable

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31
Q

Past/moral enforceability exception

A

If someone asks you to do something, it is enforceable

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32
Q

Third Party Beneficiary occurs when

A

Two people make a contract and someone else benefits

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33
Q

Types of 3rd party beneficiaries

A

Intended and incidental

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34
Q

Intended 3PBs are those who

A

the original parties intended to benefit

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35
Q

For intended 3PB, the original parties will usually

A

talk about the person they are indenting to benefit

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36
Q

To sue, the intended 3PB rights

A

have to have vested

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37
Q

How do rights vest for 3PBs?

A

When the 3PB is told that they will benefit, or they find out about it and rely on it

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38
Q

If rights have not vested for 3BP, ___

A

original parties can change they minds

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39
Q

An incidental 3PB is a person

A

who is claiming benefit, even though the original parties did not intend to benefit

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40
Q

Incidental 3BPs have

A

no rights

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41
Q

Assignment is when

A

one party assigns their rights in the contract to someone else

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42
Q

Delegation is when

A

One party delegates their duties under the contract to someone else

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43
Q

You may freely ____ or ____ to whomever you choose

A

assign; delegate

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44
Q

If one party assigns or delegates, the other party must ___

A

allow the performance

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45
Q

If the assignee breaches the contract, the non-breaching party can ___

A

sue both the assignor and the assignee

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46
Q

If assignee breaches, non-breaching party can sue both assignor and assignee, unless

A

the parties have signed a novation

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47
Q

What is a novation?

A

A novation is an agreement between parties that the non-assigning party will only sue the assignee in the occurrence of a breach

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48
Q

If there is an assignment or delegation, the assignee cannot

A

unilaterally change the contract

49
Q

When can you not assign or delegate? Even if ____

A

When the nature of the contract is unique or for personal services, even if the new person would be better

50
Q

If parties agree that neither can assign, but one of the parties does so anyway, ___

A

the assignment is valid and effective, but the assignor owes the non-breaching party damages

51
Q

If both parties agree not to delegate, ____

A

They cannot delegate

52
Q

If there is “void” language, _____

A

there can be no assignment and no delegation

53
Q

Statute of frauds

A

Certain types of agreements must be evidenced in writing

54
Q

SOF agreements acronym

A

MYLEGS

55
Q

M stands for

A

Marriage

56
Q

Y stands for

A

contracts which cannot be performed in less than one year

57
Q

L stands for

A

Land (any conveyance of land)

58
Q

E stands for

A

Executor agreement of an estate

59
Q

G stands for (BUT)

A

Guarantor (surety contract), but only when you are guaranteeing debt of someone else. If you are doing it for your own benefit, then no writing required.

60
Q

S stands for

A

Sale of goods over $500

61
Q

Exception to SOF is

A

Part performance

62
Q

4 types of Part performance

A

Land, sale of goods, guarantor, and full performance

63
Q

Land part performance

A

(1) Payment + (2) possession or (3) improvements

64
Q

Sale of goods part performance

A

(1) paid for part of the goods and (2) shipped part of the goods

65
Q

Guarantor part performance

A

Guarantor is doing it for his/her own benefit

66
Q

Full performance

A

Full performance of verbal agreement will get rid of need for writing

67
Q

Parol Evidence

A

After a contract is formed, one party tries to admit oral evidence into the contract

68
Q

How to approach parol evidence

A

Is the contract integrated? If so, is it partial or final integration?

69
Q

Final integration means that

A

The agreement that is in writing is the final agreement and parole evidence cannot come in

70
Q

Exception in final integration agreements

A

parole evidence can come in to clear up an ambiguous term

71
Q

Partial integration

A

Parole evidence is generally admissible, but it cannot contradict a material term of the agreement

72
Q

____ integration is the default, never assume _____ integration

A

Partial; final

73
Q

Parole evidence is always coming in ____ (3)

A

(1) to prevent fraud or duress, (2) to show there was a condition precedent to the contract, and (3) to show course of dealing and trade custom in a sale of goods

74
Q

Condition

A

Something happens which relieves a party of duty to perform, or makes them have to do something

75
Q

Condition language usually present itself as ___

A

“only if…”, “as long as…”, “on the condition that…”

76
Q

Condition types

A

Condition precedent, condition concurrent, and condition subsequent

77
Q

Condition precedent has to occur

A

before the date of performance

78
Q

Condition concurrent has to occur

A

at the same time as the performance

79
Q

Condition subsequent has to occur

A

after the performance

80
Q

Waiver of condition happens when

A

there is a condition and one party tells the other that they do not have to worry about the condition

81
Q

Modification

A

After negotiations are done and agreement has been finalized, one party wished to change the agreement

82
Q

What type of modification is valid?

A

Oral and written modifications are both valid

83
Q

At common law, modification requires ___

A

additional consideration

84
Q

Under UCC, modification requires ____

A

no additional consideration, only good faith

85
Q

Promissory Estoppel

A

No contract, but a promise is made which induces a party to rely to their detriment, so the promise becomes enforceable

86
Q

Detrimental means ___

A

Some thing which you would not ordinarily have done otherwise

87
Q

Non-conforming goods

A

Goods that are not what you specifically ordered

88
Q

If a seller delivers non-conforming goods, buyer has __ options

A

4

89
Q

If seller delivers non-conforming goods on the day of the contract, ____

A

buyer may reject, accept, or reject in par and accept in part

90
Q

If seller delivers non-conforming goods prior to the date of the contract and can get the right goods, ____

A

buyer must allow seller the right to cure

91
Q

If seller delivers non-conforming goods on the day of the contract, but seller had reasonable belief that buyer would accept anyway but buyer won’t, ______

A

buyer must allow seller the right to cure

92
Q

In installment contracts, one non-conforming installment ____

A

will not be a full breach, unless the delivery substantially impairs the value of the whole contract

93
Q

Remedies

A

Legal (money) or equitable remedies

94
Q

Legal damages are

A

expectation damages and liquidated damages

95
Q

Equitable remedies are

A

specific performance, injunction and rescission

96
Q

Expectation damages

A

Put the non-breaching party in a position had the contract been performed. (Default)

97
Q

Liquidated Damages

A

Clause within a contract that sets the amount of damages because if they wait until breach, damages would be too difficult to calculate

98
Q

Liquidated damages are enforceable unless

A

they are acting like penalty or punishment, or are unreasonable

99
Q

What is reasonable for liquidated damages?

A

10% of the contract price

100
Q

Equitable remedies are awarded when

A

there is no adequate remedy at law

101
Q

Specific performance

A

Someone has to perform (usually because contract is unique)

102
Q

What types of contracts are always unique?

A

Land

103
Q

Injuction

A

Stopping someone from doing something, done to prevent irreparable harm

104
Q

Recission

A

Puts the parties in a position they were prior to the contract

105
Q

Recission is granted when

A

there is no meeting of the minds (mistake or misrepresentation)

106
Q

Anticipatory repudiation

A

Prior to the date of the contract, one party unequivocally refuses to perform

107
Q

Non-breaching party in anticipatory repudiation can

A

hold the other in total breach, or wait to see if the other party performs

108
Q

If there is not an absolute refusal to perform in anticipatory repudiation,

A

you have to wait because that does not constitute a repudiation

109
Q

If you have to wait in anticipatory repudiation, you can

A

request assurances

110
Q

If you request assurances in anticipatory repudiation,

A

the other party must respond in a reasonable amount of time.

111
Q

If there is no response to assurances in anticipatory repudiation,

A

you can sue

112
Q

If there is no reason to doubt anticipatory repudiation,

A

you cannot unilaterally request assurances

113
Q

Impossibility

A

When, objectively, no one can perform

114
Q

If something is illegal, it is

A

impossible

115
Q

Impracticability

A

I can technically do it, but due to unforeseen circumstances, it would be impractical because it would be unfair

116
Q

Mistakes can be

A

unilateral or mutual

117
Q

Unilateral mistake

A

Is not a defense to performance, unless the other party knew of the mistake

118
Q

Mutual miskate

A

Both parties are mistaken as to a basic assumption of the contract

119
Q

What is the remedy for a mutual mistake?

A

Recission

MBE (8 decks)

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