Module 6 - Contracts

Question 1

promisor

Answer 1

person making a promise

Question 2

promisee

Answer 2

who the promise is made to

Question 3

what is the definition of a contract

Answer 3

An agreement that can be enforced in court, formed by two or more parties, each agrees to perform or to refrain from performing some act now or in the future.

Question 4

what is the prime thing that must be there for a contract to have been formed

Answer 4

intent

Question 5

In contract law, intent is determined by …

Answer 5

objective theory of contracts

Question 6

what is the objective theory of contracts

Answer 6

the intent to form a contract is judged by outward, objective facts as interpreted by a reasonable person, rather than by the party’s own secret, subjective intentions

Question 7

What are the three elements to a contract?

Answer 7

1. Offer
2. Acceptance
3. Consideration

Question 8

what does it mean for their to be an agreement in terms of contract law?

Answer 8

it means that they their was an offer an an acceptance

Question 9

what does it mean for there to be consideration in terms of a contract

Answer 9

needs to be valuable considerations

something of value needs to be perceived or promised

Question 10

what is contractural capacity?

Answer 10

must be competent enough to enter into an agreement

Question 11

what does legality mean in terms of a valid contract

Answer 11

the contract must not involve anything illegal

Question 12

what are the two things that act as defense when talking about a contract and make it unenforceable

Answer 12

there must be voluntary consent and must be in the correct form

Question 13

offeror

Answer 13

person making the offeror

Question 14

offeree

Answer 14

person to whom the offer is made

Question 15

what does contract law show…

Answer 15

the extent to which our society allows people to make promises or commitments that are legally binding

Question 16

What is a promise?

Answer 16

a persons declaration that he will perform or refrain from performing some present or future act

-declaration that something will or will not happen

Question 17

What is the role of contract law:

Answer 17

1. provide a mechanism to deal with others
2. Law has evolved due to commerce
3. Both parties have some sort of responsibility

Question 18

what does valuable consideration mean?

Answer 18

something that both people hold in value, but the value doesn’t have to be equal

Question 19

What type of law are contracts?

Answer 19

common law/Judge made law

Question 20

A valid contract consists of

Answer 20

agreement
consideration
legal capacity
legal purpose

Question 21

Bilateral contract

Answer 21

a promise is given in exchange for a promise.

*The offeree can accept by promising to perform so therefore the contract comes into existence at the moment the promises are exchanged

Question 22

Unilateral contract

Answer 22

offeree can accept the offer only by completing the contract performance

a promise for an act, so contract is created when the contract is performed

ex: lottery tickets (get these 5 numbers and we will pay you)

Question 23

what is the main difference between bilateral and unilateral contracts

Answer 23

timing

Question 24

formal contracts

Answer 24

A contract that requires a special form or method of formation (creation) in order to be enforceable.

Question 25

informal contract

Answer 25

A contract that does not require a specified form or method of formation in order to be valid.

Question 26

What is an express contract?

Answer 26

a contract where terms of agreement are fully stated *can be oral or written

Question 27

what is an implied contract

Answer 27

formed when parties promises are inferred from their intentional conduct and one party knows or at least has reason to know the other party will interpret the conduct as assent or an agreement

Question 28

what are the requirements for implied contracts?

Answer 28

1. goods or services being offered or furnished 2. opportunity by the recipient to reject, but failed to do so 3. the individual offering the good/service has a reasonable expectation that they will be compensated

Question 29

Executed contract

Answer 29

a contract that has been completely performed by both parties

Question 30

executory contract

Answer 30

a contract that has not yet been fully performed

Question 31

a valid contract can be...

Answer 31

enforceable, voidable or unenforceable

Question 32

enforceable contract

Answer 32

a valid contract that can be enforced because there are no legal defenses against it

Question 33

What is a voidable contract?

Answer 33

one party has the option to void the contract (one is able to get out of contract)

Question 34

what makes a contract void/voidable

Answer 34

contractual capacity: You aren’t in the right mind, you don't understand what they are signing into Legality: has to be a legal thing Genuineness of Assent: Meeting of minds, both have to understand what valuable consideration is

Question 35

unenforceable contract

Answer 35

A valid contract rendered unenforceable by some statute or law

Question 36

what is a void contract

Answer 36

no contract at all A contract having no legal force or binding effect.

Question 37

What is a Quasi contract

Answer 37

Fictional contract created by the court in the interest of fairness and justice, to prevent the unjust enrichment of one party at the expense of another

Question 38

If a person is injured on the side of the road and is given first aid by a good Samaritan, do they have any obligation to compensate the good Samaritan - you would have to pay because of quasi-contract

Answer 38

you would have to pay because of quasi-contract

Question 39

what is the purpose of a quasi contract

Answer 39

to prevent unjust enrichment

Question 40

what are the limitations of the quasi contract?

Answer 40

1. officiously (without your asking) 2. as a result of misconduct or negligence

Question 41

In keeping with the objective theory of contract, intent is generally ascertained by considering

Answer 41

- the words - the actions - circumstances surrounding the agreement

Question 42

what is the plain meaning rule?

Answer 42

When a contract is clear and unequivocal, a court will enforce it according to its plain terms, set forth on the face of the instrument, and there is no need for the court either to consider extrinsic evidence or to interpret the language of the contract

Question 43

Rules of Interpretation

Answer 43

When a contract contains ambiguous or unclear terms, a court will resort to one or more of the following rules in order to determine and give effect to the parties’ intent.

Question 44

what is the purpose of the rule of interpretation

Answer 44

to determine the parties intent from the language used in their agreement and to give effect to that intent