Level 7: Valid Contracts

Question 1

Contract

Answer 1

legally enforceable and binding agreement between parties wherein a promise to do or not do something is given in exchange for valuable consideration

Question 2

Essential Elements of a Contract: Offer & Acceptance

Answer 2

the fully agreed-upon exchange of promises by the parties

Question 3

Essential Elements of a Contract: Consideration

Answer 3

something valuable that each party exchanges in order to demonstrate that they agree to the contract’s terms

Question 4

Essential Elements of a Contract: Legally Competent Parties

Answer 4

parties involved in the contract must be legally competent, 18 years of age & not mentally incompetent or intoxicated by drugs or alcohol

Question 5

Essential Elements of a Contract: Reality of Consent

Answer 5

the agreement was arrived at as a voluntary act of good faith, cannot be any evidence of fraud, misrepresentation, mutual mistake, or misunderstanding

Question 6

Essential Elements of a Contract: Lawful Objective

Answer 6

contract cannot require any illegal activities or outcomes

Question 7

Good Consideration

Answer 7

the term gift is used to describe the conveyance or exchange (usually seen in transactions where property is given to a relative)