Exam 2 Flashcards
Contract
a promise for the breach of which the law gives a remedy or the performance of which the law in some way recognizes as a duty
types of contracts
bilateral, unilateral, executory,executed, express, implicit,
bilateral contract
both parties make a promise
unilateral contract
one party makes a promise that the other party can accept only by ACTUALLY doing something
executory contract
one or more parties have not yet fulfilled their obligations
executed contract
all parties have fulfilled their obligations
specific types of contracts
valid, unenforceable agreement, voidable, void
express contract
two parties explicitly state all the important terms of their agreement
implicit contract
the word and conduct of the parties indicate that they intended an agreement
sources for contract law
restatement of contracts, uniform commercial code, common law
elements of a contract
offer, acceptance, consideration, capacity, legality, barriers to enforcement
statute of frauds
regulates contracts that must be in writing to be enforced
parol (spoken) evidence rule
governs admission of non-written evidence about agreement, arising before or at time of signing
what is used to determine if a performance has occurred?
substantial performance, material breach, excuses non breaching party, nonbreaching party may seek damages
factors for determining material breach
lost benefit to the injured party
can the injured party be compensated
forfeiture by the breaching party
likelihood of cure
good faith and fair dealing
contracts are discharged by anticipatory repudiation by
agreement or impossibility
commercial impracticability
event neither party anticipated makes fulfilling the contract extraordinarily difficult and unfair for one party
frustration of purpose
event neither party anticipated means contract now has no value for one party
type of monetary damages
consequential and incidental
liquidated damage
pre-negotiated amount that the parties have agreed about beforehand, if there is a breach of contract
mitigated damages
injured party must act reasonably to minimize his losses
types of remedies
monetary damages, incidental, non-monetary damages, reformation
sale
passing of title from seller to buyer for a price
goods
things movable at the time of identification to the contract
warranty
a promise on which one can rely
merchantability
goods are fit for the ordinary purpose for which they are sold
what does the Magnuson-Moss Warranty Act do?
regulates terminology and does not require sellers to provide any warranties
full warranty
repair or replace free or charge
limited warranty
there is some sort of charge involved
valid contract
satisfies all of the law’s requirements
unenforceable agreement
the parties intend to form a valid bargain, but a court declares that some rule of laws prevents enforcing it
voidable contract
the law permits one part to terminate the agreement
void contract
neither party can enforce the contract because the purpose of the deal is illegal and/or one of the parties had no legal authority to make a contract
disaffirmance
individuals reject contract made while a minor
individuals who lack the capacity to make a contract
minors, intoxicated persons, and mentally incompetent persons
types of unconscionable contracts
procedural and substantive
barriers to enforcement
lack of genuine assent, mistake, fraudulent misrepresentation, undue influence, duress
fraudulent misrepresentation
deception involved in a deal of some sort
elements of fraudulent misrepresentation
false statement of material fact, speaker intends other part to rely on statement, and the other party justifiably relies
undue influence (as a barrier to enforcement)
relationship of trust
duress ( as a barrier to enforcement)
improper threat that leaves no reasonable alternative
what the writing of a statute of frauds most contain
a signature of “party to be charged with the contract”
no specific required form
what does the statue of frauds do?
regulates contracts that must be in writing to be enforced
contracts that have to be in writing
for sale of real property
contracts that cannot be performed within one year by the provided terms
contracts to guarantee someone else’s debt
promises in consideration of marriage
sale of goods costing $500 or more
Factors for determining if performance has occurred
substantial performance
material breach
excuses nonbreaching party
nonbreaching party may seek damages
types of remedies
monetary damages
non-monetary damages (equitable remedies)
reformation
types of monetary damages
consequential and incidental
sale (warranty definition)
passing of title from seller to buyer for a price
goods ( warranty definition)
things movable at the time of identification to the contract
Magnuson-Moss Warranty Act
does not require sellers to provide any warranties and regulates terminology
full warranty
repair or replace free of charge
limited warranty
there is some sort of charge involved
what is product liability based on
Negligence
what are the penalties of FTC?
counter-advertising/ corrective advertising
what does the FTC act prohibit?
unfair and deceptive acts/ practices
bait and switch advertisement
what do state usury laws regulate?
max interest rate that may be changed on loan
types of credit protections
fair credit billing act
fair credit reporting act
fair debt collection practices act
equal credit opportunity act
CARD act
Fair and Accurate Credit transactions act
fair credit billing act
credit card issues must acknowledge and investigate complaints
fair credit reporting act
consumer credit report can only be used for legitimate business needs
fair debt collection practices act
limits ability of debt collectors to use unfair or abusive tactics
equal credit opportunity act
prohibits nay creditor from discrimination against borrowing because of race, color, national origin, sex, martial status, age or because the borrower is receiving welfare.
Credit Card Accountability, Responsibility, and Disclosure (CARD) Act
prohibits certain practices such as:
~ “unfair” increases in rates or fees
~ due dates on weekends or middle of the day
~ issuing credit cards to those under 21
fair and accurate credit transactions act
consumers are entitled by law to one free credit report per year from each of the major reporting agencies
agency formed by agreement
two people agreeing on what they are wanting to do
agency formed by ratification
person chooses to accept actions taken by another
agency formed by estoppel
representation made “principal” to third party causes one to be recognized as “principal’s” agent
ways to form agencies
operation of law
estoppel
ratification
agreement
duties of principal to agent
compensation
reimbursement/ indemnification
cooperation
express authority of agents
based on representation between principal and agent
implied authority
exists because of custom or position occupied or because reasonable necessary to carry out express authority
apparent authority
principal causes third party to believe agent has particular ability to act
detour
a MINOR deviation from work routine
–> principal is liable
Frolic
a MAJOR deviation for agent’s own purposes
–> principal is not liable
ways that an agency relationship can be terminated
by the parties
by operation of law
