(Q1) Contracts & Mutual Agreement pg. 8,9,10,11 Flashcards
Contracts pg.8 Classification of Contracts pg.9 Capacity to Contract pg.11
Contract
Agreement between two or more people that is enforceable at law
Requirements for a Valid Contract
- Offer and Acceptance = Mutual agreement
- Competent Parties
- Consideration
- legality – must be legal subject matter and performed in a legal manner
- Formality in some instances – seal, witnesses, notary
Valid Contract
Completely enforceable by either party.
Void
Completely unenforceable
Voidable
valid but may be avoided by either or both parties
Expressed
all terms are stated either orally or written
Quasi Contract
Under certain circumstances the law will imply a contract exists
Formal Contract
Some states require a formality such as witnesses, a seal or notary
Simple Contract
a contract not requiring a formality
Executory Contract
all terms have not been completely performed
Executed Contract
all terms have been completely performed
Unilateral Contract
a promise given in exchange for an act to be performed
Bilateral Contract
a promise given in exchange for another’s promise
Minor
- age at common law an adult was 21., but state statutes could be different
- Most states – a minor is 17 and under for contractual purposes
Are contracts with a minor valid?
Yes, voidable (the minor’s option) except for necessities
Necessities
food, clothing, shelter, medical, insurance, items necessary for school or work
Are contacts from incompetent people valid?
- Adjudicated Incompetent people= void
- Nonadjudicated Incompetent people= voidable like a minor until person is adjudicated
Ratification
giving formal consent to a contract making it officially valid
Affirmance
confirmation of something previously done Minor can only affirm or ratify when reaching adulthood and can only disaffirm as a minor (after affirming, you cant disaffirm)
Disaffirmance
renouncing a contract previously accepted (only minors can do this)
Quasi Contract
Under certain circumstances, the law will imply a contract exists
Offer and Acceptance
offeror proposes terms to an offeree
Requirements of a Valid Offer
definite, seriously intended, communicated to offeree
Duration of the Offer
can be revoked by offeror any time before acceptance
Acceptance
assent to an offer indicating an agreement to accept it’s term
Option Contract
offeror accepts something of value to keep the offer open for a specified time
Termination of the Offer
- by acceptance
- revocation
- rejection and/or counteroffer (wager a different amount)
- lapse of time as stated in the offer
- subsequent illegality
Manner of Acceptance (of an offer)
depends on wording of offer or statute of frauds
Mailbox Rule
contract/agreement/paperwork must be postmarked by a certain time
Implied Contract
some or all terms are implied by actions or non-actions of the parties