exam 3 study guide Flashcards
What is consideration?
Consideration is inducement to make a promise enforceable. Promises are enforced only where the parties have exchanged something of value in the eye of the law.
A’s son is in the hospital. B is the doctor who will operate on him. A tells the doctor that if he successfully operates on her son she will give him $200,000. The operation is successful. Is A legally bound to pay B the $200,000? What kind of promise did A make?
No.
There is no contract since there is no consideration from B.
A’s consideration is the offer to pay the money. But B had a pre existing duty to be careful and do his job, and without consideration there is no contract.
A made a Gratuitous promise, which is not generally legally enforceable.
A goes to the dentist for an operation. Dentist bills patient for $10,000 due on April 1. On April 2 A sends a check to dentist for $5,000with a note that by cashing the check the dentist agrees to the full discharge of the debt. Can the dentist deposit the check and later sue A?
Yes the dentist could because its undisputed debt. If there is undisputed debt then the settlement of the disputed debt for an amount less than owed does not discharge the balance and does not constitute legally sufficient consideration.
A gets a phone call from a collection company saying that he owes $8,000 for a credit card debt that the collection company bought from the credit card company. A tells collection agency that the debt to credit card company was $4,000. Credit Card Company is unable to provide paperwork proving the amount. A offers to pay $6,000 to settle the claim with Collection Company. Can the collection company cash the check and sue for the balance owed. Why?
No because this is a situation of a settlement of a disputed debt and counts as sufficient consideration to discharge the balance. It therefore discharges the balance.
What is an illegal agreement? Is it void, voidable or unenforceable?
An illegal agreement is where two parties come to an agreement of doing something illegal like a drug deal or solicitation of a prostitute it is unenforceable
A is a medical doctor from Romania. He failed the exams required for practicing medicine in the US and is therefore not licensed to practice medicine in Kentucky. A does liposuction on B at a hotel pursuant to a legal agreement between the two. B liked the results of the operation but refuses to pay. Can A sue B to collect? What kind of licenses are medical licenses?
A cannot sue due to practicing without a Regulatory license to due medical procedures
A is a pharmacist who worked for a pharmacy B in a small town. A is laid off from her work. A’s former employer reminds her of the non-compete clause in her employment contract that reads that for three years from the end of her employment with B, A cannot get a job as a pharmacist in a pharmacy within 4 miles of B’s pharmacy? Is this provision enforceable? Why?
While I do believe the scope of within four miles is reasonable the duration of three years for a small town I feel is excessive and unreasonable.
Contracts with minors are voidable. What should a merchant do to protect its interest when entering a contract with a minor?
A merchant can allow for a minor to sign a contract but in order to protect their best interests they should require an adult co-signer on the contract. This person does not have to be a parent. This way the minor can not find a way out of the contract since it would be considered voidable.
A is under guardianship by court order. B learns that A wants to sell her house. If A and B enter into a contract for the sale of the house. What is the legal effect of this contract?
This contract is void because a person under guardianship loses the ability to enter into contracts. The guardian of the incompetent person must enter into the contract on their behalf.
What does the statute of frauds require?
That certain contracts need to written to be enforceable
What are the five kinds of contracts within the statute of frauds?
1) promise to answer for the duty of another
2) promises of the executor or administrator to answer personally for the duty of the defendant whose funds they are administering
3) agreements upon conisderation of marriage
4) agreement for the transfer of an interest of land
5) agreements not to be performed within the year
What is the parol evidence rule?
Excludes inconsistent prior and contemporaneous oral and written agreements not incorporated into an integrated contract.
What is a choice of law provision?
A choice of law provision allows the people entering into the contract to determine what state’s laws they will use to implement the rules of the contract if any later issues arise.
It is a way for companies or people to pick which laws they use to interpret the contract with, and is especially helpful if the two people or companies are not from the same area. (Example of the Saudi Arabia and New Jersey case.)
Can the parties have in the contract a provision that in the event of a breach of contract that the aggrieved party can get attorney’s fees?
A provision for the recovery of attorney’s’ fees in the event of breach of contract can be included in the contract
What is the primary objective of contract remedies?
the goal of contract law is to compensate- not to punish. To make whole. To put in the same position the aggrieved would have been had the breaching party performed as they were supposed to.
