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Real Estate > General Contract Law In CA > Flashcards

General Contract Law In CA Flashcards

1
Q

What are the five essential elements of a contract?

A

Legally competent parties
Offer and acceptance
Legal purpose
Consideration

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2
Q

Legally competent parties

A

Of age, not a minor

Legal and Mental capabilities

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3
Q

Offer and acceptance

A

Mutual agreement or just acceptance
Required in writing agreed-upon terms, and must be clearly understood by both parties
Offer
Acceptance
Notice and delivery

All parties are aware of the terms in the contract

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4
Q

Consent

A

Voluntary agreement
A contract must be entered into a free, involuntary act

Circumstances to deprive a party; fraud, misrepresentation, mutual mistake

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5
Q

Legal purpose

A

The idea that a contract must not proposed to do anything illegal, such as a contract would be unenforceable

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6
Q

Consideration

A

The giving of something of value, which can include the agreement to not do some thing. Consideration is a required element of a binding contract.

Money
Property
Labor

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7
Q

Offer and acceptance

A

Mutual agreement or acceptance occurs when parties enter into agreement with full understanding of the contract terms. By signing the contract to parties are indicating, they understand and agree to terms.

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8
Q

What does legal purpose mean?

A

Contracts must be written for a lawful objective

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9
Q

What’s consideration
with regard to a contract?

A

Something of value is given in exchange for something of value

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10
Q

What are examples of consideration in a contract?

A

The sellers promise to sell the property to buyer
The sellers commitment to transfer the property to the owner
The property itself

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11
Q

Requires mutual agreement of terms

A

Offer and acceptance

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12
Q

Something of value even a promise to do or not to do something

A

Consideration

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13
Q

Age of majority and mental soundness

A

Legally competent party

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14
Q

Must be for a lawful reason

A

Legal purpose

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15
Q

Must be entered, voluntary without dress or undue influence

A

Consent

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16
Q

Required for contract validity only when the nature of the contract is real property

A

It must be in writing

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17
Q

Parties capable of contracting in California

A

Emancipated minors under 18, married legally or active duty with US Armed Forces
Aliens, non-resident of California
Sole proprietors
Partnerships, LLCs , corporations, nonprofit
Personal representative executor of an estate
Convicts

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18
Q

Parties not capable of contracting in California

A

Miners those of age 18 and under, and not emancipated
Incompetence, unless represented by a guardian and with court approval

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19
Q

Statute of frauds

A

Adopted by all states, the statute of frauds is a legal concept that all contracts involving the creation or conveyance of an interest in real property, must be in writing to be enforceable

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20
Q

Statute requirements

A

Identify the contracting parties
Clearly identify the subject matter of the contract
Present the essential terms and conditions of the contract

Marriage contracts, including prenuptial
Contracts that are more than one year, such as the steps longer than a year
Executor of a will to pay a debt of an estate from the executors on funds
Sale of goods totaling 500 or more
One Party agrees to pay the debt of another

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21
Q

The parol evidence rule

A

Parole, meaning, formal promise, written agreement is the final and comprehensive expression of parties agreement. The parole evidence rule supports this by prohibiting parties from stating in court that the written contract FaceTime wasn’t really what they intended.

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22
Q

What is the statute of fraud?

A

Allow requiring contracts, conveying ownership in real property to be in writing to be enforceable

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23
Q

The central terms and conditions of the contract must be present
Is a requirement
It’s not a requirement

A

Is a requirement

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24
Q

The contracting parties must be identified
Required
Not required

A

Required

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25
Q

The contract subject must be clearly identified
Required
Not required

A

Required

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26
Q

If a minor wants to do yardwork for an adult and make a contract and they sign it is the contract void

A

Technically, the contract is invalid, voidable and unforeseeable, but they can both hold their agreement if they are both satisfied

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27
Q

The terms agreed to in a written contract, or the only terms relating to the contract any form of written contract, including email, communication, may be considered” in writing”, and binding

True or false

A

True
Any form of written contract, including email communication maybe considered “ in writing” I’m finding

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28
Q

What does the parole evidence rule say about contract?

A

The term agree to in a written contract, are the only terms relating to the contract

The parole evidence rule states that only a limited cases may extraneous evidence be presented to dispute the terms of a signed contract

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29
Q

The statute of frauds states that if a contract transferring ownership of real property is not in writing,———
Enforceable
Executory
Unenforceable
Voidable

A

Voidable

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30
Q

Resident and nonresident aliens have the same property ownership rights as citizens in California
True or false

A

True

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31
Q

Express contract

A

They stated, written or oral agreement between two parties to specific terms

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32
Q

Implied contract

A

A contract that is based on actions or behaviors of the parties, not on words and implied by actions

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33
Q

Bilateral contract

A

A mutual contract that involves an exchange of promises, or other consideration between two parties

Both sides, having certain obligations

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34
Q

Enforceable contract

A

A contract that meets all criteria for validity, including compliance with local laws, and may be held up in court of law

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35
Q

Unforeseeable contract

A

A contract that will not hold up in court

It might be missing one or more elements for validity or it may appear to be valid, but not completely with local laws, such as the state statute of frauds

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36
Q

Valid contract

A

A contract that contains all the essential elements and is binding in court of law

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37
Q

Invalid contract

A

Essential elements are missing from the contract

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38
Q

Void contract

A

A contract with no legal force, or a thought, often because it lacks one or more essential elements

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39
Q

Voidable contract

A

A contract that may be concealed by one or more parties for one of the several reasons, a contract that is not automatically void, but being legally incomplete, may be declared void by one of the parties

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40
Q

Executed contract

A

A contract in which all parties have met all contract terms

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41
Q

Executory contract

A

A contract in progress, one or more contract terms remains undone

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42
Q

What are sales contracts?

A

Express
Bilateral
Void
Enforceable
Executed or executory

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43
Q

Do you agree to buy a vacant property from a developer for $10,000?

Bilateral contract
Unilateral contract

A

Bilateral contract

44
Q

You promise to pay $100 reward if someone returns your phone
Bilateral contract
Unilateral contract

A

Unilateral contract
Only one person has obligation. Here you’ll pay the reward there’s no other specific party.

45
Q

You’ll get a haircut that cost $50
Bilateral contract
Unilateral contract

A

Bilateral contract
This is an agreement that your stylus will cut your hair and you will pay $50
Two parties are in agreement

46
Q

A contract that is missing one or more essential elements
Invalid
Voidable
Valid

A

Invalid
Meaning, it just needs elements to finalize

47
Q

A contract may be canceled for one of a number of reasons
Invalid
Voidable
Valid

A

Voidable
Could be against the law for any reason it can be canceled

48
Q

An oral agreement to purchase a property
Enforceable contract
Unenforceable contract

A

Unenforceable
Contract must be in writing to buy property

49
Q

Sam offers to buy Tina’s property for $500,000. His written offer includes no earnest money. Tina accept his offer.
Enforceable contract
Unenforceable contract

A

Enforceable contract
He saying he will pay it just not by earnest money maybe he’s going to pay via loan

50
Q

What must the statute of frauds contract written agreement include

A

Identify the contracting parties
Clearly identify the subject matter of the contract
Present the essential terms and conditions of the contract

51
Q

A contract that will not stand up in court, but may still be valid if parties want to complete performance

A

Unforcable contract

52
Q

A contract with no legal affect, even when all the essential elements for the contract exist

A

Void contract

53
Q

A contract that may or may not be enforceable between the parties, and usually means one party, did not meet a legal requirement of the agreement

A

Voidable contract

54
Q

A contract that is binding and enforceable on all concerned parties, because it contains all essential contract elements

A

Valid contract

55
Q

A contract in which only one party makes a promise (to try to get the other party to do something).

A

Unilateral contract

56
Q

Some of the terms on a contract have not yet been completed

A

Executory contract

57
Q

A contract in which the parties to the contract have definitely agreed on all of the contract terms

A

Express contract

58
Q

A contract in which all terms have been fully completed

A

Executed contract

59
Q

A contract that is interpreted, from the party’s actions
Inferred meaning conclusion

A

Implied contract

60
Q

A contract in which two parties make promises to each other

A

Bilateral contract

61
Q

Parole evidence rule

A

A fully executed, valid, written contract, trumps all prior negotiation

62
Q

Insertions to pre-printed form contracts

A

Must be initials and dated it made after the contract was signed by Parties

Have an order of priority
Hand written, insertions, tech, precedence a.k.a. priority, over type insertions
Typed insertions, take precedence priority, over pre-printed material

63
Q

Numbers, written, alphabetically prevail ( more powerful ) , over numerals

A

Precedence ten
Back burner 10

64
Q

What is one reason that a roll of evidence a contract can be canceled or voided

A

Evidence can be used to show that the contract is invalid when there has been a mistake, or worse, a case of fraud

65
Q

Order of precedence for insertions

A

Hand written, insertions, take priority, over both types and pre-printed material.

Typed insertions, take priority, over pre-printed material.

66
Q

You’re talking to a coworker at lunch and she mentions that she has a box of baby clothes her kids have her outgrown and she needs to get rid of. You have a baby on the way, so you offer to pay $25 and she agrees to bring the box to work the next day and give it to you which of the following is true in the situation?

This is an expressed contract because you defined in words, the specific terms of the agreement, and consideration to be exchanged

This is implied contract because it is not written down and nobody signed anything

This is an invalid contract, because it is not written down and nobody signed anything

This is a unilateral contract, because only one party is providing anything of value

A

This is an express contract because you defined in words, the specific terms of agreement, and consideration to be exchanged

This can be in words, orally, or in writing

67
Q

Performance of a contract

A

Means to meet all terms of the contract.. The discharging. (ending.) the contract through the full completion of all terms.

Partially perform a contract, a.k.a. partial performance occurs when a party does some but not all of what the party has agreed to do

68
Q

The phrase in a contract
“ time is of essence”

A

A legal phrase that means that the parties agree that the deadlines set are vital to the contract, and that no one will unduly delay their completion

69
Q

Failure ” time is of the essence”

A

Failure to perform within the timeframe of a contract is a breach of a contract. When a specific date is not provided in the contract, performance must take place within a reasonable time.

70
Q

What does the term “performance of a contract.” Mean?

A

To meet all of the terms of a contract

71
Q

What does the phrase “time of the essence” mean when regard to a real estate contract?

A

The parties agree to proceed in good faith, and not unduly delay the process

72
Q

What are types of ways to release a contract?

A

Conditional
Some applications must be for the release to be accomplished

Unconditional
No obligation needs to be mad. It’s a done deal.

With consideration
Requires compensation of some kind

73
Q

Recession

A

To take back remove or annul
Definitive end of the parties commitments under the agreement, usually due to a breach of contract

Parties are returned to their pre-contracted status. Latin word, status quo ante

74
Q

What are rescission reasons?

A

Mutual mistake- different understandings
Unilateral mistake - misunderstanding terms
Fraud
Lack of capacity to contract
Duress - one party uses threats violence
Undue influence

75
Q

Impossibility of performance of contract

A

Destruction of premises destroyed by naturally or unintentional causes
Due to circumstances out of their control, the parties cannot legally or practically do what they’ve agreed to do

76
Q

Assignment (contracts)

A

When a new party to a contract agrees to satisfy the former parties obligations. Unless there is a novation, a new contract,

the original party remain liable for the contract terms.

77
Q

Novation parties
Novation a contract

A

The substitution of a new contract for a prior contract, or a new party for an old party.

The original party is no longer obligated under the contract

All parties to the original contract must agree to the novation

Complicated and should always have an attorney participation

78
Q

Breach of contract

A

One or more parties failed to meet the terms of their agreement

Can forgive, or can sue

79
Q

Breach of contract scenarios

A

Excempt partial performance
Resend the contract unilaterally
Sue for damages punitive compensatory damages
Sue for specific performance
Except liquidated damages
Mutually resend the contract, mutually recession of the contract

80
Q

Breach of contract remedies

A

Terminate
Unilateral recession
Mutual of recession

Accept
Accept partial performance
Liquidated damages

Sue
For a monetary damages
For specific performance

81
Q

Statute of limitations

A

There is a limit to the time in which a wrong party, buyer or seller can initiate a court action

82
Q

Ask for statue of limitation’s ,how many years do you have to initiate a court action if you find a defect with a property that a seller did not disclose?

A

4 years, but that some thing the clients attorney should advise them on

83
Q

A contract between a client, an agent to sell real property

A

Listing agreement

84
Q

Legal written agreement between a buyer and seller that states the purchase price and the other terms of understanding by which real property will be transferred

A

Contract for sale

85
Q

Acts as the receipt for earnest money given by the buyer to secure an offer

A

Deposit receipt

86
Q

The legal agreement between a buyer and a broker hired to represent the buyers interest

A

Buyer representation agreement

87
Q

A particular section or clause in the contract, legislation or law

A

Provision

88
Q

Loss of money, or anything of value due to failure to perform

A

Forfeiture

89
Q

A privilege sold by one party to another that offers the buyer the right, but not the obligation, to buy at an agreed-upon price during a certain period of time, or on a specific date

A

Option

90
Q

An agents compensation, for performing duties of all the agency, usually percentage of the selling price of a property

A

Commission

91
Q

Offer, formally

A

Tender

92
Q

A contract between a client, an agent to sell real property

A

Listing agreement

93
Q

Legal written agreement between buyer and seller that states the purchase price and other terms for transfer of property

A

Contract for sale

94
Q

Receipt for earnest money, given by buyer to secure an offer

A

Deposit receipt

95
Q

Legal agreement between a buyer and a broker hired to represent the buyer’s interest

A

Buyer representation agreement

96
Q

A little section in a contract or law

A

Provisions

97
Q

Loss of money, or anything of value, often due to failure to perform

A

Forfeiture

98
Q

Offers the buyer, the right, but not the obligation to buy an agreed-upon price during a certain period of time or on a specific date

A

Option

99
Q

An agent compensation, or perform the duties of an agency, usually a percentage of the selling price of the property

A

Commission

100
Q

A formal offer

A

Tender

101
Q

General real estate, contract, provisions

A

Date of agreement- set the timeline benchmark for all contractual deadlines
Names and addresses of parties to the contract - identification
Description of the property -identifies property being transferred
Consideration - an item of value used to show good faith and intent
Mortgage terms and conditions - how property will be financed financing
contingencies
Other professions requested by Party’s - specific terms not included in pre-printed contract form
Date in place of closing the contract - set a deadline and location for the parties to complete their contractual seven obligations and settled the transaction

102
Q

Uniform vendor and purchaser risk act

A

States that any contract for the sale of real property will be interpreted to mean that the parties agree that:

If buyer hasn’t taken possession, and title, hasn’t transferred in the event of a disaster, causing destruction damage to the property, the buyer can recover any monies paid such as earnest money deposit

If the buyer has either taken possession, or the title has been transferred in the event of a disaster, the buyer is not relieved from the duty to pay the agreed price or we cover any portion of the price already paid.

103
Q

The person who holds the title to the property is the person who assumes the risk pertaining to the uniform, vendor and purchaser act

True or false

A

False

The buyer has taken possession, but the seller still holds the title, the buyer is obligated

104
Q

Property that is taken by eminent domain is exempt from the uniform, vendor and purchaser act
True or false

A

False

105
Q

Reformation contract

A

Is a legal remedy in which the court rewrite the contract to ensure both parties true intentions are reflected

Real Estate (39 decks)

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