Final Exam- Module 5

Question 1

Discharge

Answer 1

A way to settle a dispute. No more obligations

Question 2

Accord and satisfaction: discharge:

Answer 2

refers to the agreement (accord) between two contracting parties to accept alternate performance to discharge a pre-existing duty between them and the subsequent performance (satisfaction) of that agreement. The new performance is called the accord.

Question 3

Disaffirm the contract: discharge

Answer 3

the right for one party to renounce a contract. People who can prove they lacked the capacity to enter a legally binding contract, like minors, and mentally ill.

Question 4

Conditions

Answer 4

an obligation to perform

Question 5

Poor performance:

Answer 5

(not good enough) same as breach, and the party affected is discharged (defendant)

Question 6

Conditions: Express

Answer 6

The use of “condition” is not required Because it’s already expressed.

Question 7

Conditions: Implied

Answer 7

Not given notice.

Question 8

Condition precedent

Answer 8

It happens before duty. Turn conditions on

Question 9

Condition subsequent:

Answer 9

Happens after a duty. Turn conditions off

Question 10

Conditions: concurrent:

Answer 10

Mutual obligation. Both parties have mutual obligations. No breach, if one side fails to perform. If you don’t do this, I won’t either, (type of thing), then both are discharged.

Question 11

Condition: illusionary

Answer 11

No always. However illusionary happens when the plaintiff relies on the promise of the defendant.

Question 12

Strict performance

Answer 12

Must be performed, as agreed ,if not performed as agreed in the contract, then ex: Ron breaches the contract, and Harry is discharged from that contract. GOVERNED BY UCC LAW

Question 13

Substancial performance:

Answer 13

less than a complete performance. Ex Ron will be discharged because it was not the model they agreed on. GOVERNED COMMON LAW

Question 14

Personal satisfaction clause

Answer 14

good enough? Close enough? (1) Objective (by default) the purpose of the contract. (2) Subjective (applies to some) for personal taste. If so, in that contract there must be a personal satisfaction clause, like if hiring to do art, because it is subjective to the buyer’s personal taste.

Question 15

Breach

Answer 15

fail to perform what the contracts says.

Question 16

Material breach of a contract

Answer 16

fails to perform an essential part of the contract. Also entitled to money damages.

Question 17

Imposibility

Answer 17

when an unforeseen event occurs after the contract is made which makes performance impossible. Then, is automatic discharge.

Question 18

What contracts are Substantial performance?

Answer 18

UCC and Common Law contracts

Question 19

What contracts are Strict performance?

Answer 19

Contracts that are based on time: “time of essence”

Question 20

Anticipatory breach

Answer 20

Do not wait until the breach happens, IF you can anticipate that you are going to breach it.

Question 21

Impossibility: Commercial impracticality

Answer 21

Performance much more difficult, and cannot be accomplished: no automatic discharge

Question 22

Impossibility: Frustration on common purpose

Answer 22

Contracts has no value to both parties: potential discharge

Question 23

What does a contract needs to qualify to as “impossibility”

Answer 23

-Must be unforeseeable event
-Outside of parties control
Then the non-breaching party is entitled to money damages from the breaching party.

Question 24

Remedies: Expectation of interest

Answer 24

It is the primary way of measuring damages for breach of contract. (Benefit or Bargain) an agreement between two or more parties as to what each party will do for the other.

Question 25

Expectation of interest: Direct damages

Answer 25

Are those directly from contract.

Question 26

Expectation of interest: Consequential damages

Answer 26

Those from the breach of contract. (as a result of) in most cases, you can recover these money damages. Another factor that helps, is if the plaintiff knew about the consequences of not giving the service.

Question 27

Expectation of interest: Incidental Damages

Answer 27

Are those damages that the party incur as a response to the breach. However, The UCC says: If seller breaches, buyer can get all three: Direct, consequential, and incidental damages. (However, for consequential damages, it must be foreseeable.)

Question 28

Punitive damages on expectation of interest?

Answer 28

There are no punitive damages.

Question 29

Agency Law

Answer 29

Is common law, and is governed by state law.

Question 30

What are Agents?

Answer 30

Agents are employees: ex: Lawyer, accountant, realtor, etc.

Question 31

What are principals?

Answer 31

Principles are employers: the business that employees the agents.

Question 32

Agents are a separated body (no contract required, but preferable) However, there must be 3 important keys to this.

Answer 32

1 Consent: permission to do something (authorized person) 2a: Control: (trustee) the power to make and apply decisions 3a: Judiciary: (trust) act in behalf of someone else IT HAS TO BE THE THREE ELEMENTS, NOT JUST ONE

Question 33

Duties of Agents to Principals: (4)

Answer 33

Duty of Loyalty: duty to comply with what the principal says (unless is a illegal request, or violation of law) Duty to Obey: duty to do what the principals says Duty of Care: duty to behave reasonably in favor of the principal's interest and policies. Duty to provide/convey information. Duty to provide important information to your principal- no keeping information. lack of these duties, subject to the liability of the agent. if one of the principal's requests violates law, then the agent may violate its duty, and the agent is not liable.

Question 34

Duties of Principals to Agents: (2)

Answer 34

Pay them: salary, benefits, commissions, reimbursements, and indemnify (like false imprisonment) Let them work, no unreasonable interference. Also, some duties that the Principals have with the agents, is to provide the necessary equipment to perform their job safely. Like if in a restaurant, then provide uniforms, ingredients, and tools needed.

Question 35

Terminating the Agency: ways in which the agent is terminated (6)

Answer 35

1. Contract terms: time - expiration of the contract, no renewal, 2. Principals terminate/ fire/ agents quits: at will job, can happen at any time. 3. Operation of law: by legal principles. 4. License revoked: some employees are hired because they have the necessary permission to do certain things, but if their license is revoked, then there is no need for that person. 5. Death/incapacity: the contract is terminated when death occurs, or is incapacitated to do their job, like mentally ill. 6. Breach of duty/ loyalty: the agent does not comply with the principal's request.

Question 36

EXPRESS AUTHORITY: Principal's liability for contracts negotiated by an agent.

Answer 36

Express means made in words, orally or in writing

Question 37

IMPLIED AUTHORITY: Principal's liability for contracts negotiated by an agent.

Answer 37

Implied means the agent has authority to perform acts incidental to or reasonably necessary to carrying out the transaction for which she has express authority.

Question 38

APPARENT AUTHORITY: Principal's liability for contracts negotiated by an agent.

Answer 38

When the principal does something to make the other party think that the Agent has authority.

Question 39

RATIFICATION: Principal's liability for contracts negotiated by an agent.

Answer 39

If an Agent has no authority and signs a contract, principle is not bound to that. However, the principles or someone authorized, can ratify the contract and make it happen/valid.

Question 40

FULLY DISCLOSED PRINCIPAL: Principal's liability for contracts negotiated by an agent.

Answer 40

Principal liable, no agent. If the principal is disclosed (known) then he is responsible.

Question 41

Unidentified principal: Liability

Answer 41

P + A liability: third party knew of his existence, but not his identity.

Question 42

Undisclosed principal: Liability

Answer 42

P + A liability: Third party didn’t know of his existence.

Question 43

Unauthorized agent: Liability

Answer 43

A liable: No authorized at all (no express, implied, or apparent)

Question 44

Agents Liability: TORTS

Answer 44

agents are always personally responsible for their negligence and intentional torts while representing a principal.

Question 45

How to determine Principal's Liability: TORTS

Answer 45

If an agents commits a tort, determine whether it is negligence or an intentional tort. If negligence, determine if everything is within the scope of employment, or detours.

Question 46

Intentional torts: PHYSICAL TORTS - P or A Liability.

Answer 46

like battery or false imprisonment. If the agent is an employee acting within the scope of employment, such as a security guard who commits false imprisonment, then the principal (the employer) is liable for the tort. If the agent is not an employee or is acting outside the scope of employment, such as an office worker who assaults a co-worker, then the principal is not liable.

Question 47

Intentional torts: NON-PHYSICAL TORTS - P or A Liability.

Answer 47

like Fraud or defamation. Agents are liable for their torts, and Principles may have liability if their agent had express, implied, or apparent authority from the principal.