Module 2

Question 1

Objective Theory of Contract

Answer 1

Judges the intent
A way to determine if a contract is actually formed. A party’s intention to enter into a legally binding agreement, or contract is judged by outward, objective facts.

Question 2

Requirements of a valid contract

Answer 2

Agreement: Includes and offer and agreement.
Consideration: Any promises made by the parties to the contract must be supported by legally sufficient & bargained for consideration.
Contractual Capacity: Both parties have to posses characteristics that point to them having the ability to enter into a contract.
Legality:The contracts purpose must be to accomplish some goal that is legal and not against public policy.

Question 3

Distinguish between express and implied in fact contracts

Answer 3

1. Express: Contract where the terms of agreement are fully and explicitly stated in words (spoken or written)
2. Implied: Contract not created by the explicit agreement of the parties, but mutual assent, consideration, capacity, and legality is inferred by acts of circumstances (i.e conduct of the parties.)Requirements:
3. The plaintiff furnished some service or property
4. The plaintiff excepted to be paid for that service or property, and the defendant knew/should have known that payment was expected.
5. Defendant had a chance to reject the service and didn’t.

Question 4

Duty Based Ethics:

Answer 4

Focuses on the obligation of the corporation/ duties owed/ rights to be protected.
Derived from religion and or philosophical reasoning.

Question 5

Outcome Based Ethics: Utilitarianism

Answer 5

Focuses on the consequences of actions
Looks at impact/outcome of a decision and attempts to max. Good and min. Bad.
“Greatest good for greatest number of people”
Cost analysis