REG 3 - R6 Contracts and Sales Flashcards
In Privity (regarding contracts)
One of the parties to a contract (if they are named in the contract)
Intended Beneficiaries
someone who intended to be benefited by a contract other than the bargaining parties.
Consideration
where parties promise to do something with legal value
3 Components of a Contract
- Offer
- Acceptance
- Consideration
Merchant’s Firm Offer
Offer made by a merchant firm, in writing and must remain open until time specified and if no time is specified, offer must stay open for a reasonable period of time - Not exceeding 3 months
Fraud in the Inducement
When a person is defrauded into entering into a contract because its terms or the surrounding circumstances are not as represented. This contract is voidable.
Fraud in the Execution
The party did not know that he was signing a contract. This renders a contract void.
Non-assignable contract
Insurance polices
Express Warranty
An affirmation of fact or promise that becomes part of the basis of the bargain
Warranty of Merchantability
A promise that the goods will be fit for their ordinary purposes.
Warranty against Infringement
A promise that the goods sold do not infringe on another’s patents or copyrights.
Perfect Tender Doctrine
A buyer may reject goods if they do not conform to the contract in any way.
Good Faith Requirement met by merchant
The merchant must observe the reasonable commercial standards of fair dealing in the trade
AF.O.B. Destination
The seller has the risk of loss until he places conforming goods into the buyer’s hands at the named destination
Auction without Reserve
The goods must be sold if an offer is made. If no offer is made within reasonable time, the goods need not be sold.
