Contracts

Question 1

What is a contract?

Answer 1

a legally enforceable promise

Question 2

What is contract law?

Answer 2

enables private agreements to be legally enforceable

Question 3

What is a bilateral contract?

Answer 3

an agreement containing mutual promises that both parties must perform

Question 4

What is a unilateral contract?

Answer 4

an agreement containing one promise that only one party must perform

Question 5

What is an express contract?

Answer 5

arise from oral or written terms of the agreement

Question 6

What is an implied contract?

Answer 6

arise from the conduct of the parties, rather than their written or spoken words

Question 7

What are the elements of an enforceable contract?

Answer 7

offer, acceptance, and consideration

Question 8

How do all contracts start?

Answer 8

with an offer

Question 9

What is an offeror?

Answer 9

a person making the offer

Question 10

What is an offeree?

Answer 10

the person to whom the offer is made

Question 11

What happens when an offer is accepted?

Answer 11

both parties are bound

Question 12

What is an unenforceable contract?

Answer 12

when a party has a justifiable reason for not complying with a promise

Question 13

What is a void contract?

Answer 13

cannot be enforced by either party, unenforceable from the inception of the agreement

Question 14

What is a voidable contract?

Answer 14

one party is bound by the contract, the other party may enforce or cancel the contract

Question 15

What is an executed contract?

Answer 15

performed

Question 16

What is an executory contract?

Answer 16

to be performed

Question 17

What is revocation?

Answer 17

offeror retracts offer before offeree accepts

Question 18

What is rejection?

Answer 18

offeree rejects offer

Question 19

What is a counter-offer

Answer 19

offeree offers different terms

Question 20

What is expiration?

Answer 20

offeree fails to accept before a deadline

Question 21

What are the conditions of termination of the offer by operation of law?

Answer 21

subject matter destroyed
offeror death/insanity
subject matter becomes illegal

Question 22

What is the meaning of acceptance?

Answer 22

creates a binding and enforceable contract, perform requested act (unilateral contract)

Question 23

What is the mirror image rule?

Answer 23

acceptance must “mirror” the offer

Question 24

What is the mailbox rule?

Answer 24

contract created at the moment offeree sends acceptance, offeror cannot revoke offer once the offeree places acceptance in mailbox or sends electronically

Question 25

When does consideration exist?

Answer 25

when parties agree to exchange resources, when a party promises to do something the party is not already obligated to do

Question 26

When does consideration not exist?

Answer 26

when a party promises to make a gift

Question 27

What is an option contract?

Answer 27

a promise to keep an offer open for a certain period of time, must be supported by consideration

Question 28

What capacities of contracts are avoidable?

Answer 28

minors, intoxicated, mentally incompetent

Question 29

What is duress?

Answer 29

using force or threat of force to make someone enter into a contract

Question 30

What is undue influence?

Answer 30

unduly persuading a party to enter into a contract

Question 31

What is an oral contract?

Answer 31

an oral contract is as enforceable as a written contract, the problem is proof

Question 32

What is statue of frauds?

Answer 32

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

Question 33

What is contract interpretation?

Answer 33

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

Question 34

What the parol evidence rule?

Answer 34

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

Question 35

What is performance?

Answer 35

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

Question 36

What is substantial performance?

Answer 36

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

Question 37

What is a breach of contract?

Answer 37

occurs when a party fails to perform an agreed-upon act

Question 38

What is mitigation?

Answer 38

when a breach occurs the non-breaching party (the victim) must mitigate damages when possible