Contracts I--What is a contract Flashcards
What is a contract?
A contract is (1) a promise or set of promises (2) (a) for the breach of which the law gives a remedy or (b) the performance of which the law recognizes as a duty.
Contracts I–What is a contract
Contracts>What is a Contract? (I.A)
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What is an express contract?
Express contracts are contracts formed by language, oral or written.
Contracts I–What is a contract
Contracts>Types of Contracts (I.C.1.a)
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What is an implied in fact contract?
Implied contracts are contracts formed by manifestations of assent by conduct, not oral or written language (e.g., if a person sits in a barber’s chair and the barber cuts his hair, a contract has been formed by the parties’ conduct).
Contracts I–What is a contract
Contracts>Types of Contracts (I.C.1.a)
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What is a quasi-contract or implied in law contract?
Quasi-contracts are NOT contracts; rather, they are constructed by courts to avoid unjust enrichment.
Contracts I–What is a contract
Contracts>Types of Contracts (I.C.1.a)
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What is a bilateral contract?
A bilateral contract is one consisting of the exchange of mutual promises.
Contracts I–What is a contract
Contracts>Types of Contracts (I.C.2.a)
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What is a ‘sale’?
A sale is a contract in which title to GOODS passes from the seller to a buyer at a price [UCC 2-106(1)]
Contracts I–What is a contract
Contracts>UCC definitions (I.B.1)
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What are ‘goods’?
Goods are all things movable at the time they are identified as the items to be sold under the contract.
Goods include things (cars, horses, hamburgers) but not real estate, services (e.g., club membership), intangibles (e.g., patent) or construction contracts.
Goods associated with real estate (minerals, growing crops and uncut timber, fixtures) may fall under Article 2.
Contracts I–What is a contract
Contracts>UCC definitions (I.B.2)
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If a contract involves both goods and services, how does a court determine whether the UCC applies?
A court will determine whether the goods aspect or the service aspect is dominant and apply the law governing that aspect to the entire contract. But if the contract divides payment between goods and services, Article 2 will apply to the goods portion and common law will apply to the services portion.
Contracts I–What is a contract
Contracts>UCC definitions (I.B.3)
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Who is a ‘merchant’?
A merchant is one who regularly deals in goods of the kind sold or who otherwise by his occupation holds himself out as having knowledge or skills peculiar to the practices or goods involved.
Contracts I–What is a contract
Contracts>UCC definitions (I.B.4)
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What is ‘good faith’?
Good faith is honesty in fact and the observance of reasonable commercial standards. The UCC imposes an obligation of good faith on every contract within the UCC.
Contracts I–What is a contract
Contracts>UCC definitions (I.B.5)
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What is a bilateral contract?
A bilateral contract is one consisting of the exchange of mutual promises.
Example: Sidney promises to sell Blackacre to Bertram for $6,000, and Bertram promises to purchase Blackacre at that price.
Contracts I–What is a contract
Contracts>Types of Contracts (I.C.2.a)
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What is a unilateral contract?
A unilateral contract is one where an offeror-promisor promises to pay upon the completion of the requested act by the promisee. Generally, the contract is only formed upon completion of the task.
Example: Susan promises to pay Charles $5 if he will deliver a textbook to Rick. Charles is not obligated to deliver the book, but if he does in fact deliver it, Susan is obligated to pay him the $5.
Contracts I–What is a contract
Contracts>Types of Contracts (I.C.2.b)
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In what two common ways can you accept most contracts?
Acceptance by Promise or Start of Performance
Under the UCC Art. 2 & R2Contracts, unless clearly indicated otherwise by the language or circumstances, all offers (aka ‘indifferent’ offers) can accepted by promising or beginning performance.
Example: Acme Co. orders specifically manufactured goods from Barnes Manufacturing Co. Recognizing the speed with which the order must be filled, Barnes begins to manufacture the ordered item shortly after the order is received. This constitutes an acceptance of the offer if Barnes gives Acme notice of its beginning of performance within a reasonable time, and it creates an implied promise on the part of Barnes to complete manufacture.
Contracts I–What is a contract
Contracts>Types of Contracts (I.C.2.c.1)
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In what two ways can a unilateral contract occur?
Under the UCC Art. 2 & R2Contracts:
(i) where the offeror unambiguously indicates that completion of performance is the only manner of acceptance
(ii) where there is an offer to the public that can clearly only be accpeted through performance (i.e. reward offer for lost dog, paid $20 upon returning dog to owner)
Contracts I–What is a contract
Contracts>Types of Contracts (I.C.2.c.2)
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How does a court determine if there was in fact a contract?
A court will determine the creation of a contract by asking three basic questions:
(1) Was there mutual assent?
(2) Was there consideration or some substitute for consideration?
(3) Are there any defenses to creation of the contract?
Contracts I–What is a contract
Contracts>Creation of a Contract (I.D)
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