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Business Law > Contracts > Flashcards

Contracts Flashcards

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1
Q

Everyday Contract

A

Exchange of things of value

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2
Q

Elements of a contract

A

Offer, Acceptance, Consideration

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3
Q

Bilateral Contracts

A

A promise for a promise

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4
Q

Unilateral Contracts

A

Promise for an act, acceptance by completion of requested act, if act isn’t fully completed promise can be pulled out of at any time, most courts will uphold contracts that have substantial completion

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5
Q

Void Contracts

A

Without legal effect from the start, ex. agreement to commit crime

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6
Q

Voidable Contracts

A

One or both parties may elect to void or ratify contract, ex. sign at 17 but void or ratify once 18

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7
Q

Unenforceable Contract

A

Otherwise valid, but not enforceable due to various defenses (Some contracts need to be in writing)

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8
Q

Creation of a Contract (3 Questions)

A

Was there mutual assent (offer and acceptance)?
Was there consideration (value)?
Are there any defenses?

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9
Q

Meeting of the minds

A

Agree to the same terms of a contract at the same time

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10
Q

Objective Measure

A

What would a reasonable person believe the offer and acceptance is, required when forming a contract

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11
Q

Offeree

A

Power of acceptance

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12
Q

Offeror

A

Corresponding Liability

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13
Q

Intent

A

Language, circumstances, prior practice

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14
Q

Legal Offer Requires

A

Definite terms, identity of offeror/offeree and the subject matter, price, time of payment, delivery or performance, quantity, nature of the work, communication to the offeree

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15
Q

Acceptance

A

Reasonable and unequivocal (strong yes or no), action can be acceptance

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16
Q

Mirror Image Rule

A

Terms of the acceptance must perfectly match the terms of the offer (any change of terms is rejection and a counter-offer)

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17
Q

Termination by Offeror

A

Revocation (terminates power of acceptance), taking back offer, effective when received

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18
Q

Termination by Offeree

A

Rejections (counter-offer or express), lapse of time (specified time period or reasonable time

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19
Q

When does termination happen?

A

Before acceptance

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20
Q

Termination by Operation of Law

A

Death or adjudicated incompetent terminates, subject matter of contract is destroyed, legislation makes contract illegal

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21
Q

Consideration

A

Needs offer and acceptance beforehand

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22
Q

Valuable consideration

A

Change in legal position between the parties (agreeing to do or not do something) (Giving up legal right)

23
Q

Elements of Consideration

A

1) Bargained for exchange between the parties (promise and detriment)
2) Must have legal value (mutual benefit, economic value not required, past or moral acts are insufficient)

24
Q

Contract Defenses

A

Void or voidable, fraud, undue influence, duress, statue of frauds

25
Q

Void or Voidable if

A

Illegal subject matter, lacked capacity (minors, incompetent), mistake of material fact (If both parties made a mistake then voidable, can’t void if only one party was mistaken)

26
Q

Fraud

A

Saying something knowingly false to get them to agree to contract, makes it so you aren’t engaging in the same contract (no meeting of the minds)

27
Q

Undue Influence

A

Violating position of trust, forcing into agreement

28
Q

Statue of Frauds

A

Contracts that must be in writing

29
Q

Agreements that must be in writing

A

Sale of real property or land
Collateral promises to pay the debt of another
Sale of goods $500+
Contract which by its terms cannot be performed within one year

30
Q

Essential Terms in Written Contracts

A

Identity of the party against whom enforcement is sought
subject matter
terms and conditions
consideration
signature of the party to be charged

31
Q

Discharged

A

Contract has been forgiven or completed

32
Q

Failure of a Condition

A

Can’t meet a condition of the contract, the contract goes away

33
Q

Discharge by supervening Illegality

A

Contract becomes illegal by new law

34
Q

Impossibility in Contract

A

Unanticipated event happens after contract is finalized that makes it impossible to complete (can’t pain house if it burns down)

35
Q

Impossibility if someone dies

A

If dies or is incapacitated contract is discharged only if person is necessary to contract, if not contract stands

36
Q

Objective Test

A

Reasonable person standard

37
Q

Discharge by Impracticability or Frustration

A

Unanticipated events, performance becomes extremely difficult or expensive, purpose of K is nearly or is destroyed

38
Q

Discharge by Rescission

A

Legally terminated through mutual agreement

39
Q

Breach of Contract

A

1) Duty to perform
2) failure to perform in accordance with contractual terms

40
Q

Material Breach

A

Something of significance

41
Q

Breach Remedies

A

Compensatory Damages, Expectation Damages, Reliance Damages, Consequential Damages

42
Q

Compensatory Damages

A

Money

43
Q

Expectation Damages

A

Standard measure of, place plaintiff in the position they would have been in if defendant have performed

44
Q

Reliance Damages

A

Place plaintiff in the position they would have been in had K never been formed

45
Q

Consequential Damages

A

damages, losses, or injuries that result naturally, but not necessarily directly from the contract

46
Q

Equitable Remedies

A

When legal remedy is inadequate, Specific Performance, Recission and Restitution

47
Q

Specific Performance

A

Court order to perform K, subject matter of the K is rare or unique (land is unique), not for service contracts

48
Q

Recission and Restitution

A

The non-breacher may cancel the K, appropriate where the non-breacher has attempted to perform or transferred a benefit (want full money back)

49
Q

Quasi- Contract

A

K was never created but court created K in the interest of fairness

50
Q

For Quasi-contract must show…

A

Plaintiff conferred a benefit to defendant
Plaintiff has a reasonable expectation of compensation
Defendant will be unjustly enriched
(Doctor treating unconscious patient)

51
Q

Exception to the Privity of Contract Doctrine

A

The K is private or exclusive to the people that entered into it, explicitly states who is to be beneficiary

52
Q

Intended Beneficiary

A

One or more of the below
1) Performance rendered to beneficiary
2) Beneficiary can control details of performance
3) Beneficiary is expressly designated in the K

53
Q

Can a 3rd Party Beneficiary sue over K?

A

Yes, if in case of breach 3rd party can sue the party who made the promise that benefits the 3rd party

Business Law (10 decks)

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