Exam 3 CHP 10 Flashcards
An agreement, upon sufficient consideration, to do or not to do a particular thing.
Contract
It is a key element common in all contracts, contract center.
Promise
Withdrawal of the offer.
Revocation
A form of rejection. A proposal by the offeree to change the terms of the original offer.
Counteroffer by offeree
A contract with an exchange of promises.
Bilateral contract
A contract where there is acceptance by performance.
Unilateral contract
Something of value or something bargained for in exchange for a promise, that is, both parties to a contract get something and give up something.
Consideration
Legal ability to create a contract.
Contractual capacity
Status of a person under the legal age of majority. Most of the time 18.
Minority status
When one party to the contract has the right to avoid a legal obligation.
Voidable contract
A contract that does not exist at law, and so cannot be enforced.
Void contract
To approve and give formal sanction to; confirm. Example: A minor that reaches the age of majority.
Ratification
“Of unsound mind”, This phrase was first used in thirteenth-century English law to describe people afflicted by madness, the loss of memory or ability to reason.
Non compos mentis (NCM)
For a contract to be valid, its subject matter must be lawful.
Legality of contract
Charges above the maximum allowed interest rates are called…
Usury
Contracts legal when they were made, but a change in law made them unenforceable.
Unenforceable contracts
Releases one party from the consequences brought about by their wrongful acts or negligence.
exculpatory agreements
A contract that is grossly unfair to an innocent party, the courts, inequity, will not enforce it.
Unconscionable contracts
The customer sued a fridge company for the overcharging of a sale of a fridge.
Jones v. Star Credit case
A seller, or former employee, may not conduct business to compete against a previously sold business or become employed at a competitor’s business, respectively.
Covenant not to compete
Which state prohibits covenant not to compete?
California
A person who enters into an agreement without understanding key information about the real nature of the transaction.
Genuiness of consent
A party enters a contract with false information or accidentally makes an error in a significant matter.
Mistake
The effort of a party to induce another party to enter into a contract based on false information.
Fraud
Can be intentional or based on negligence, incorrect information is represented.
Misrepresentation
A person enters into a contract because they are so dominated by another person, or have so much trust in that person, they are subject to improper persuasion.
Undue influence
Woman sues a dance instructing company over manipulation of sales over many years. Woman wins.
Vokes v. Murray Case
3-days to revoke contract by buyer
Texas rule under HSSA (Home Solicitation Sales Act)
6-days to revoke contract by buyer
Texas timeshare Act
When contracts must be evidenced by a writing to be enforceable.
Statute of frauds (real estate contracts, promises made in consideration of marriage)
Restricts the use of oral statements.
Parol Evidence Rule
The contract basically has been fulfilled, and payments must be made.
Substantial performance
Party to a contract does not perform as required v. party has done substantially less than the requirements of the contract.
Breach v. Material Breach
When parties are free to agree to modify or terminate a contract.
Discharge of contracts
Is called a contract, but not a literal contract. To give relief to innocent parties or to prevent injustice, even though no true contract exists. Imposed by the law without a contract.
Quasi contract
To avoid injustice. Something of value has been provided, but there was no contract or completion of contract.
Quantum meruit
Parties agree that the contract should be terminated without performance.
Rescission
An agreement by the parties to offer and accept performance that differed from the original agreement.
Accord
When an event occurs that makes performance impossible.
Impossibility
Damages that are an amount specified in the contract to be paid in the event of a breach.
Liquidation damages
Damages rewarded when a plaintiff suffers a breach of contract but does not suffer a measurable economic loss.
Nominal damages
These damages are usually awarded when the wrongdoer’s conduct has been willful or malicious and fraud was involved.
Punitive damages
Reasonable efforts to lessen the losses that may be incurred.
Mitigation of damages
Remedies such as specific performance or an injunction.
Equitable remedies
An order of the court requiring a party who created a wrong to perform the obligations promised in a contract.
Specific performance for unique items
If one party has unjustly enriched themself at the expense of another party, the court can order payment to be made.
Restitution
A contract that expects actions rather than being expressed by the parties.
Implied contract
A contract that is based around a written or oral expression of intent by the parties to enter into a legally binding agreement.
Expressed contract
A promise to do something or to refrain from doing some specific thing.
Offer
These damages are to allow the party suffering the breach to recover costs incurred as a result of relying on the promise of the other party.
Compensatory damages
