Contracts Flashcards
What is a contract?
a legally enforceable promise
What is contract law?
enables private agreements to be legally enforceable
What is a bilateral contract?
an agreement containing mutual promises that both parties must perform
What is a unilateral contract?
an agreement containing one promise that only one party must perform
What is an express contract?
arise from oral or written terms of the agreement
What is an implied contract?
arise from the conduct of the parties, rather than their written or spoken words
What are the elements of an enforceable contract?
offer, acceptance, and consideration
How do all contracts start?
with an offer
What is an offeror?
a person making the offer
What is an offeree?
the person to whom the offer is made
What happens when an offer is accepted?
both parties are bound
What is an unenforceable contract?
when a party has a justifiable reason for not complying with a promise
What is a void contract?
cannot be enforced by either party, unenforceable from the inception of the agreement
What is a voidable contract?
one party is bound by the contract, the other party may enforce or cancel the contract
What is an executed contract?
performed
What is an executory contract?
to be performed
What is revocation?
offeror retracts offer before offeree accepts
What is rejection?
offeree rejects offer
What is a counter-offer
offeree offers different terms
What is expiration?
offeree fails to accept before a deadline
What are the conditions of termination of the offer by operation of law?
subject matter destroyed
offeror death/insanity
subject matter becomes illegal
What is the meaning of acceptance?
creates a binding and enforceable contract, perform requested act (unilateral contract)
What is the mirror image rule?
acceptance must “mirror” the offer
What is the mailbox rule?
contract created at the moment offeree sends acceptance, offeror cannot revoke offer once the offeree places acceptance in mailbox or sends electronically
When does consideration exist?
when parties agree to exchange resources, when a party promises to do something the party is not already obligated to do
When does consideration not exist?
when a party promises to make a gift
What is an option contract?
a promise to keep an offer open for a certain period of time, must be supported by consideration
What capacities of contracts are avoidable?
minors, intoxicated, mentally incompetent
What is duress?
using force or threat of force to make someone enter into a contract
What is undue influence?
unduly persuading a party to enter into a contract
What is an oral contract?
an oral contract is as enforceable as a written contract, the problem is proof
What is statue of frauds?
sale of an interest in land, guaranty of debt, contracts cannot be performed within one year, certain contracts must be in writing to be enforceable
What is contract interpretation?
words are given their common meaning, courts interpret ambiguous terms according to trade usage, handwritten terms control typed terms, ambiguous terms are interpreted against the drafter
What the parol evidence rule?
when the meaning of a contract is clear parties may not introduce evidence of prior oral agreements, the court is limited ti the four corners contract
What is performance?
parties enter into contracts to ensure the performance of a promise made, a party is discharged when that party has fulfilled all obligations under the contract and is relived from further performance
What is substantial performance?
when a party honestly attempts to perform all terms of a contract but falls short, the party has substantially performed the contract, a party who substantially performs is entitled to enforce the contract, less any damages resulting from the minor breach
What is a breach of contract?
occurs when a party fails to perform an agreed-upon act
What is mitigation?
when a breach occurs the non-breaching party (the victim) must mitigate damages when possible
