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Contracts and Sales 1 > Midterm 1 > Flashcards

Midterm 1 Flashcards

1
Q

Always begin an analysis by:

A

determining the nature of the transaction.
Sale of goods or services

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2
Q

If it is the sale of goods use

A

UCC

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3
Q

If services use

A

Common law

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4
Q

Hybrid Contract of both goods and services use:

A

UCC for goods portion and common law for the rest

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5
Q

Courts apply an _________ test to determine whether there has been an offer and an acceptance.

A

Objective

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6
Q

It does not matter what a party may have __________ ________ the test is what a reasonable person in the other party’s position would believe was meant by the promisor’s words or conduct.

A

Subjectively intended

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7
Q

Courts apply an ____________ test to determine whether there has been an _________ and _________. It does not matter what a party may have subjectively intended — the test is what a __________ _________ in the other party’s position would believe was meant by the promisor’s words or conduct.

A

Objective
Offer and acceptance
Reasonable person

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8
Q

What governs contracts to purchase land between two private parties?

A

Common law

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9
Q

Contract formation requires _________ _________.

A

Mutual assent (offer and acceptance)

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10
Q

Determinations as to mutual assent are made based on an _______ ________.

A

Objective standard

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11
Q

There is no _______ ______ if there is not sufficient certainty in the terms.

A

Mutual assent

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12
Q

A corollary to ________ _______ is that the parties must __________ legal consequences for their agreement.

A

mutual assent
Intend

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13
Q

An _______ is a manifestation of present intent and willingness to enter into a bargain and be bound. An ________ contains _______ and _______ terms.

A

Offer
Offer
Specific and Definite

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14
Q

An offer is freely _________ at any time before acceptance unless the offer qualifies as an _____ ______ or is made irrevocable by statute or reliance.

A

Revocable
Option contract

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15
Q

Can an offer be made to more than one party?

A

Yes

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16
Q

An acceptance must _______ the ______ of the _______.

A

Mirror
Terms
Offer

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17
Q

Acceptance must be made in the _______ and _______ invited by the _______.

A

Manner
Medium
Offer

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18
Q

A ___________ terminates the power of ________ and operates as a _______. If an _______ makes a __________, the ________ cannot then accept the offer.

A

counteroffer
Acceptance
Rejection
Offeree
Counteroffer
Offeree

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19
Q

A _______ ________ is a manifestation of intent by the offeror not to enter into the contract. It is effective upon receipt.

A

Direct revocation

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20
Q

An _______ _______ occurs when the offeror takes definite action inconsistent with the intent to enter into the contract and the Offeree acquires reliable information to that effect.

A

Indirect revocation

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21
Q

The first requirement to form a contract is:

A

An agreement between the parties, generally referred to as a mutual manifestation of assent. (Offer and acceptance)

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22
Q

Both parties must _______ to contract and must agree to the same terms.

A

Intend

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23
Q

Mutual assent is found through the process of _____ and _______.

A

Offer and acceptance

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24
Q

Define Offer:

A

The proposal to enter into a contract

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25
Q

Define Offeror:

A

The person who makes the offer

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26
Q

The _______ is the ________ of the ________.

A

Offeror
Master
Offer

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27
Q

Define Offeree:

A

The party to whom the offer is made

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28
Q

An offer may be:
1.
2.
3.

A

Spoken
Written
Implied by a party’s conduct

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29
Q

Upon receiving the offer, if the Offeree wishes to enter the agreement proposed by the offer, they must _________ their ______ to it.

A

Manifest
Assent

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30
Q

Define Acceptance:

A

The offeree’s assent to the terms of the offer

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31
Q

The offer must contain ______ and ______ terms.

A

Specific
Definite

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32
Q

The standard formula for forming a contract in which one party (the ________) makes a proposal (the ________) to the other party (the _________), indicating an intent to enter into a deal on the proposed terms. The ______ invitees the offeree’s ________, and if given, is called the acceptance and concludes the deal.

A

Offeror
Offer
Offeree
Offer
Assent

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33
Q

Does a counteroffer terminate the offer?

A

Yes

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34
Q

In situations where the parties “______ ___ ______” or agree to negotiate further concerning material terms, generally no contract will be found. Here, the ___________ of terms generally prevents formation.

A

Agree to agree
Indefiniteness

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35
Q

In some situations, the parties may reach an agreement orally, but do not intent to be bound until they have _______ __ _______ ______.

A

Executed a final writing

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36
Q

____________ are not ordinarily intended or understood as offers to sell because they would expose the maker to the risk of liability for performance well beyond the maker’s ability.

A

Advertisements

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37
Q

Generally, ________ are interpreted as _______ to the public to come and purchase or as preliminary proposals inviting offers.

A

Advertisements
Invitations

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38
Q

___________ exception:
Case: Lefkowitz v. Great Minneapolis Surplus Store, Inc., where an ad was found to be an offer. It was _________ ______, ______, and ______ ________ open for _________.

A

Advertisement
Sufficiently clear
Definite explicit
Left nothing
Negotiation

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39
Q

If a statement is not an offer, it might be
1.
2.
3.
4.

A
  1. Expression of opinion
  2. A statement of intent
  3. An inquiry
  4. An invitation to deal
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40
Q

In determining whether an offer has been made, the court looks first to:

A

The language of the particular proposal

41
Q

In determining whether an offer has been made, the court looks first to: ______________________________. It will also consider:
1.
2.
3.
4.

A
  1. Surrounding circumstances
  2. Any prior communications between the parties
  3. Relevant trade practices
  4. The completeness of the suggested exchange
42
Q

For an ________ to be valid, it must become effective while the power of acceptance is still in effect.

A

Acceptance

43
Q

An offeree’s power of acceptance may be terminated in any of the following ways:
1.
2.
3.
4.

A
  1. Revocation by the offeror
  2. Rejection or counteroffer by the Offeree
  3. Lapse of time
  4. Death of Incapacity of the offeror or Offeree
44
Q

The _______ is free to ________ the offer at any time before it is effectively accepted unless the offer qualifies as an _______ or is otherwise made irrevocable by statute or reliance.

A

Offeror
Revoke
Option

45
Q

The offeror has the power to _______ even though the offer plainly states the opposite and promises to be held open for a specific period of time. This is becase:

A

revoke
An agreement is binding as a bargain only if supported by consideration.

46
Q

True or False: Unless the promisor receives something in exchange for the promise to keep the offer open, the offeror is not bound and can revoke the offer at any time before it is accepted.

A

True

47
Q

A ________ must be communicated to the Offeree to be effective. Communication may be _____ or _______.

A

Revocation
Direct or indirect

48
Q

____________ __________ of revocation occurs when the offeror acts in a way that is inconsistent with an intent to enter the contract and the offeree acquires this information through a reliable source.

A

Indirect Communication

49
Q

________ of the offer by the offeree terminates the power of acceptance and the offeree can no longer accept the offer.

A

Rejection

50
Q

If the offeree attempts in her ‘acceptance” to add to or vary the terms of the offer, then it is not an acceptance but a ___________ and a _________ of the offer.

A

Counteroffer
Rejection

51
Q

To be an effective acceptance it must be a _____ ________ of the offer.

A

Mirror image

52
Q

As the master of the offer, the offeror may set the time for acceptance and the offeree’s power of acceptance is terminated at the time specified in the offer. True or False

A

True

53
Q

If no time is specified, then the offer lapses:

A

At the end of a reasonable time.

54
Q

If no time is specified, then the offer lapses at the end of a reasonable time. What is a reasonable time depends on all the ___________ ____________ at the time the offer and attempted acceptance was made.

A

Surrounding circumstances

55
Q

When parties are engaged in _________ negotiations (bargaining face-to-face), the power of acceptance continues only during the _______________, unless a contrary intent is indicated.

A

Direct
Conversation

56
Q

The offeror’s ________ terminates the power of acceptance — whether or not the offeree has notice of the ________.

A

Death
Death

57
Q

The offeror’s _______ ___ ________ terminates the power of acceptance in the same manner as the offeror’s death.

A

Lack of capacity

58
Q

The rules of death or incapacity of the offeror or offeree do not apply to _________ _________.

A

Option contracts

59
Q

The power of acceptance under an _________ ______________ is not terminated by rejection or counteroffer, by revocation, or by death or incapacity of the offeror, unless the requirement are met for the discharge of a contractual duty.

A

Option contract

60
Q

Once the offeree accepts the offer in the manner and on the terms required by the offer, a _________ is formed and both parties are _________.

A

Contract
Bound

61
Q

If the offeror does not specify the form of acceptance, then the offeree may accept “__________________________________.”

A

“In any manner and by any medium reasonable in the circumstances

62
Q

In forming a _____________ contract, each party makes a promise. The offeror’s promise is contained in the offer and the offeree makes a return promise in the acceptance.

A

Bilateral

63
Q

____________ refers to the fact that both parties have made promises.

A

Bilateral

64
Q

Jon offers to pay $1000 in return for Jessica’s promise to sell her car. As soon as Jessica accepts Jon’s offer with her return promise, a _______ ________ is formed and both parties are bound.

A

Bilateral contract

65
Q

In forming a ___________ contract, only one party makes a promise — the offeror’s promise is in the offer and the offeree renders a ____________ as the acceptance.

A

Unilateral
Performance

66
Q

Some offers may only be accepted by performance — the doing of the requested act — and not a return promise. This is true in what type of contract?

A

Unilateral

67
Q

A valid acceptance is said to be the “________ ________” of the offer.

A

Mirror image

68
Q

If the acceptance contains terms that are different from those of the offer, then it is not an acceptance but a rejection or counteroffer. True of false

A

True

69
Q

When the offeree tenders of beings the invited performance, the offer becomes ________ to allow the offeree a reasonable time to ________ _ ________.

A

Irrevocable
Complete the performance

70
Q

The offeree is not bound to complete the performance and if chooses not to do so, there is no breach because no contract was formed. True of False

A

True

71
Q

Where the offeree can choose to accept either by promise or performance, the tender or beginning of the invited performance or a tender of a beginning of it is an acceptance by performance. Such an acceptance acts as

A

a promise to render complete performance.

72
Q

Under the “Mailbox Rule”, if the acceptance is “made in a manner and by a medium invited” by the offer, the acceptance is effective upon:

A

Dispatch

73
Q

The rationale is that the offeree should be able to rely on the contract and be protected against a revocation by the offeror following the ___________ of the ___________.

A

Dispatch
Acceptance

74
Q

At the dispatch of an acceptance, the offeror’s power to revoke is ___________ and the offeror is _________, even though the offeror does not know that the offer has been accepted.

A

Terminated
Bound

75
Q

The offeror, as the master of the offer, cn depart from the mailbox rule by providing otherwise in the offer. True of False

A

True

76
Q

Upon dispatch, the mailbox rule also binds the offeree to the acceptance and it now becomes tool ate for the offeree to either reject the offer or revoke the acceptance. True or false.

A

True

77
Q

The mailbox rule applies only to acceptances by mail, not ____________. A ___________ is not effective until received by the offeree.

A

Revocations.
Revocation

78
Q

The general rule is that mere silence is not _____________.

A

Acceptance

79
Q

Silence held to be acceptable are where the offeror has stated or given the offeree reason to believe that assent may be given by silence or inaction and the offeree in remaining silent and inactive ________ to ________.

A

Intends
Accept

80
Q

It is also possible to infer acceptance by silence where previous dealings of the parties make it reasonable for the offeree to notify the offeror if she does not intend to accept. True or False

A

True

81
Q

Most offers are freely _________. Even an offeror’s promise not to revoke the offer or a statement that the offer is not revocable is unenforceable unless it is supported by _________.

A

Revocable

Consideration

82
Q

Example: Spencer makes an offer to sell his car to Adam for a specified price and tells him that the offer is open for a week to let Adam think about it. Under common law rule, can Spencer sell his car to someone else even though he promised to keep the offer open?

A

Yes, he can. Unless Spencer had made the offer irrevocable by forming an option contract.

83
Q

Under the UCC, a contract for sale may be found even though the precise moment of its making is undetermined, and it may be formed in any manner sufficient to show agreement. True of False

A

True

84
Q

Does the UCC allow for contract formation when one or more terms are left open, relying on its “____ ______” provisions to supply the missing terms as long as the parties intended to contract?

A

Gap filler
Yes!

85
Q

Section 2-204(3) states: “Even though one or more terms are left open a contract for sale does not ______ for __________ if the parties have intended to make a contract and there is reasonably certain basis for giving an appropriate remedy.

A

Fail
Indefiniteness

86
Q

Sales contracts must contain a __________ term whereas almost all other terms can be supplied by the UCC’s “gap-fillers”.

A

Quantity

87
Q

There are gap filler provisions for:
1.
2.
3.

A
  1. Price
  2. Delivery
  3. Payment terms
88
Q

Failure to include an important ______ or _______ does not automatically prevent a contract from forming.

A

Term
Terms

89
Q

UCC 2-206 invites ____________ of an offer to buy goods “in any manner and by any medium reasonable in the circumstances” unless the offer or circumstances unambiguously indicate otherwise.

A

Acceptance

90
Q

An order to other offer for prompt or current shipment may be accepted either by a ________ _________ to ________ or by the _______ or _________ ___________ of _________ _________.

A

Prompt promise
Ship
Prompt
Current shipment
Conforming goods

91
Q

Shipment of non-conforming goods, however, may be an _________ and at the same time _ ________.

A

Acceptance
A Breach

92
Q

At common law, a shipment of non-conforming goods would be considered a ______________.

A

Counteroffer

93
Q

Under the UCC, however, if the seller ships no conforming goods in response to an offer, a contract is ___________ and the non-conforming shipment is both an ___________ of the offer and, at the same time, a _________.

A

Formed
Accceptance
Breach

94
Q

No contract is formed if “the seller ______________ ________ the buyer that the shipment is offered only as an _______________ to the buyer” and then the shipment would be a counteroffer.

A

Seasonably notifies
Accommodation

95
Q

Unless the thing given in exchange is of so little value that it fails for “want” of consideration, courts will or will not inquire into adequacy.

A

Will NOT

96
Q

If a party makes a promise but reserves the right to change their mind, this is an __________promise.

A

Illusory

97
Q

_________ refers to whether the consideration has any value at all int he eyes of the law.

A

Sufficiency

98
Q

_________ refers to the quantities of the consideration exchanged between the parties.

A

Adequacy

99
Q

Requirement for consideration:
Each party generally receives a ___________ and a __________.

A

Benefit and a detriment

Contracts and Sales 1 (2 decks)

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