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
2
Q
Legally competent parties
A
Of age, not a minor
Legal and Mental capabilities
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
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
5
Q
Legal purpose
A
The idea that a contract must not proposed to do anything illegal, such as a contract would be unenforceable
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
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.
8
Q
What does legal purpose mean?
A
Contracts must be written for a lawful objective
9
Q
What’s consideration
with regard to a contract?
A
Something of value is given in exchange for something of value
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
11
Q
Requires mutual agreement of terms
A
Offer and acceptance
12
Q
Something of value even a promise to do or not to do something
A
Consideration
13
Q
Age of majority and mental soundness
A
Legally competent party
14
Q
Must be for a lawful reason
A
Legal purpose
15
Q
Must be entered, voluntary without dress or undue influence
A
Consent
16
Q
Required for contract validity only when the nature of the contract is real property
A
It must be in writing
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
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
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
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
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.
22
Q
What is the statute of fraud?
A
Allow requiring contracts, conveying ownership in real property to be in writing to be enforceable
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
24
Q
The contracting parties must be identified
Required
Not required
A
Required
25
The contract subject must be clearly identified
Required
Not required
Required
26
If a minor wants to do yardwork for an adult and make a contract and they sign it is the contract void
Technically, the contract is invalid, voidable and unforeseeable, but they can both hold their agreement if they are both satisfied
27
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
True
Any form of written contract, including email communication maybe considered “ in writing” I’m finding
28
What does the parole evidence rule say about contract?
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
29
The statute of frauds states that if a contract transferring ownership of real property is not in writing,———
Enforceable
Executory
Unenforceable
Voidable
Voidable
30
Resident and nonresident aliens have the same property ownership rights as citizens in California
True or false
True
31
Express contract
They stated, written or oral agreement between two parties to specific terms
32
Implied contract
A contract that is based on actions or behaviors of the parties, not on words and implied by actions
33
Bilateral contract
A mutual contract that involves an exchange of promises, or other consideration between two parties
Both sides, having certain obligations
34
Enforceable contract
A contract that meets all criteria for validity, including compliance with local laws, and may be held up in court of law
35
Unforeseeable contract
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
36
Valid contract
A contract that contains all the essential elements and is binding in court of law
37
Invalid contract
Essential elements are missing from the contract
38
Void contract
A contract with no legal force, or a thought, often because it lacks one or more essential elements
39
Voidable contract
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
40
Executed contract
A contract in which all parties have met all contract terms
41
Executory contract
A contract in progress, one or more contract terms remains undone
42
What are sales contracts?
Express
Bilateral
Void
Enforceable
Executed or executory
43
Do you agree to buy a vacant property from a developer for $10,000?
Bilateral contract
Unilateral contract
Bilateral contract
44
You promise to pay $100 reward if someone returns your phone
Bilateral contract
Unilateral contract
Unilateral contract
Only one person has obligation. Here you’ll pay the reward there’s no other specific party.
45
You’ll get a haircut that cost $50
Bilateral contract
Unilateral contract
Bilateral contract
This is an agreement that your stylus will cut your hair and you will pay $50
Two parties are in agreement
46
A contract that is missing one or more essential elements
Invalid
Voidable
Valid
Invalid
Meaning, it just needs elements to finalize
47
A contract may be canceled for one of a number of reasons
Invalid
Voidable
Valid
Voidable
Could be against the law for any reason it can be canceled
48
An oral agreement to purchase a property
Enforceable contract
Unenforceable contract
Unenforceable
Contract must be in writing to buy property
49
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
Enforceable contract
He saying he will pay it just not by earnest money maybe he’s going to pay via loan
50
What must the statute of frauds contract written agreement include
Identify the contracting parties
Clearly identify the subject matter of the contract
Present the essential terms and conditions of the contract
51
A contract that will not stand up in court, but may still be valid if parties want to complete performance
Unforcable contract
52
A contract with no legal affect, even when all the essential elements for the contract exist
Void contract
53
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
Voidable contract
54
A contract that is binding and enforceable on all concerned parties, because it contains all essential contract elements
Valid contract
55
A contract in which only one party makes a promise (to try to get the other party to do something).
Unilateral contract
56
Some of the terms on a contract have not yet been completed
Executory contract
57
A contract in which the parties to the contract have definitely agreed on all of the contract terms
Express contract
58
A contract in which all terms have been fully completed
Executed contract
59
A contract that is interpreted, from the party’s actions
Inferred meaning conclusion
Implied contract
60
A contract in which two parties make promises to each other
Bilateral contract
61
Parole evidence rule
A fully executed, valid, written contract, trumps all prior negotiation
62
Insertions to pre-printed form contracts
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
Numbers, written, alphabetically prevail ( more powerful ) , over numerals
Precedence ten
Back burner 10
64
What is one reason that a roll of evidence a contract can be canceled or voided
Evidence can be used to show that the contract is invalid when there has been a mistake, or worse, a case of fraud
65
Order of precedence for insertions
Hand written, insertions, take priority, over both types and pre-printed material.
Typed insertions, take priority, over pre-printed material.
66
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
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
Performance of a contract
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
The phrase in a contract
“ time is of essence”
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
Failure ” time is of the essence”
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
What does the term “performance of a contract.” Mean?
To meet all of the terms of a contract
71
What does the phrase “time of the essence” mean when regard to a real estate contract?
The parties agree to proceed in good faith, and not unduly delay the process
72
What are types of ways to release a contract?
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
Recession
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
What are rescission reasons?
Mutual mistake- different understandings
Unilateral mistake - misunderstanding terms
Fraud
Lack of capacity to contract
Duress - one party uses threats violence
Undue influence
75
Impossibility of performance of contract
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
Assignment (contracts)
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
Novation parties
Novation a contract
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
Breach of contract
One or more parties failed to meet the terms of their agreement
Can forgive, or can sue
79
Breach of contract scenarios
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
Breach of contract remedies
Terminate
Unilateral recession
Mutual of recession
Accept
Accept partial performance
Liquidated damages
Sue
For a monetary damages
For specific performance
81
Statute of limitations
There is a limit to the time in which a wrong party, buyer or seller can initiate a court action
82
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?
4 years, but that some thing the clients attorney should advise them on
83
A contract between a client, an agent to sell real property
Listing agreement
84
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
Contract for sale
85
Acts as the receipt for earnest money given by the buyer to secure an offer
Deposit receipt
86
The legal agreement between a buyer and a broker hired to represent the buyers interest
Buyer representation agreement
87
A particular section or clause in the contract, legislation or law
Provision
88
Loss of money, or anything of value due to failure to perform
Forfeiture
89
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
Option
90
An agents compensation, for performing duties of all the agency, usually percentage of the selling price of a property
Commission
91
Offer, formally
Tender
92
A contract between a client, an agent to sell real property
Listing agreement
93
Legal written agreement between buyer and seller that states the purchase price and other terms for transfer of property
Contract for sale
94
Receipt for earnest money, given by buyer to secure an offer
Deposit receipt
95
Legal agreement between a buyer and a broker hired to represent the buyer’s interest
Buyer representation agreement
96
A little section in a contract or law
Provisions
97
Loss of money, or anything of value, often due to failure to perform
Forfeiture
98
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
Option
99
An agent compensation, or perform the duties of an agency, usually a percentage of the selling price of the property
Commission
100
A formal offer
Tender
101
General real estate, contract, provisions
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
Uniform vendor and purchaser risk act
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
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
False
The buyer has taken possession, but the seller still holds the title, the buyer is obligated
104
Property that is taken by eminent domain is exempt from the uniform, vendor and purchaser act
True or false
False
105
Reformation contract
Is a legal remedy in which the court rewrite the contract to ensure both parties true intentions are reflected
