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Mgmt 211 > test 2 ch. 4-5 > Flashcards

test 2 ch. 4-5 Flashcards

1
Q

define contract

A

system of rules for enforcing promises and breaking promises - must be legally enforceable M.C.C.L.G.W

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2
Q

what is contract law

contract law makes promises

A

common law by the states/ judge made law

legally enforceable
consequences of breaking promises

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3
Q

characteristics of common law

A

fundamental part of our economic and the legal system

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4
Q

voluntary mutually beneficial exchanges take place when…

A

voluntary mutually beneficial exchanges will take place in the absence of contract law

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5
Q

mutually beneficial exchange

A

giving and getting something of value from both parties
fundamental purpose of the law is to facilitate beneficial exchange
Exchanging milk for coconuts to increase take in

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6
Q

an expressed contract is stated

A

orally

written contract

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7
Q

implied contract (implied by factor contracts)

A

inferred from the conduct of the parties

ex. sitting in the barber chair

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8
Q

quasi contracts

A

not a true contract - something is missing
rare
ex. yard work without permit

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9
Q

implied in law contract

A 
quasi contract
law/judge implied the contract 
1. element missing
2. judge fills in the missing elements
prevents unjust enrichment
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10
Q

what are you doing if you use quasi contract

A

throwing yourself on the mercy of the court

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11
Q

unconditional contract

A

absolute contract - MUST PERFORM

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12
Q

conditional contracts

A

no duty to perform if condition not met

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13
Q

types of conditional contracts

A

conditional subsequent
conditional precedent
conditional concurrent

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14
Q

bilateral contracts

enforced?

A

promise for a promise
“saying yes i promise is a promise back”
enforced when 2nd promise is made

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15
Q

unilateral

how many promisors

what percentage of work needs to be done

enforced?

A 
promise for an act
one promisor 
offeree accepts by performance
"just doing it without saying yes"
has to be fully performed

fully performed

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16
Q

executory contract

A

not fully performed by either party

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17
Q

executed contracted

A

contract has been fully performed by both parties

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18
Q

partially executed

A

one party has has completed the work

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19
Q

valid contracts

A

all elements are present

enforceable

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20
Q

void contracts

A

not a contract

no legal obligation of any parties

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21
Q

voidable contracts

A

one of the parties has the right to avoid contractual obligations without incurring legal liability

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22
Q

unenforceable contracts

A

valid contract that can no longer be performed because something happened (ie. law change, destroyed)

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23
Q

how are contracts enfored

A

usually through common law but varies state to state BUT it is getting more uniform - can be supplemented by statutory law

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24
Q

elements of a contract (6)

A

All elements must be present
M.C.C.L.G.W.
1. mutual agreement (offer and acceptance)
2. consideration
3. capacity - understand the nature of the contract
4. legality
5. genuine and real assent to the contract
6. some contracts must be in writing - statue to fraud principle

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25
Texas elements of a contract (8)
1. offer 2. acceptance 3. meeting of the minds 4. each party must consent to the terms 5. if it must be in writing it needs to be executed and delivered 6. consideration 7. legality 8. capacity - understand the nature of the contract
26
Element Agreement
mutual assent 1. intent 2. definite terms and conditions 3. communication of the offer
27
how do you terminate an offer (5)
``` R.R.L.C.T. revocation rejection lapse of time counteroffer termination by law ```
28
Acceptance of a contract
U.U.L.C.U. must be unconditional - exact, mirror image rule must be unequivocal must be legally communicated unilateral contracts - performance is acceptance
29
Consideration
something of value bargained for in exchange for a promise, legal detriment and legal benefit
30
legal detriment
give up some legal right - consideration | an act or promise to act or refraining from an act which you are not legally obligated to do
31
legal belief
legal right acquired by promisors due to promisees legal detriment
32
adequacy of consideration
courts do not care about this courts do not bail you out of a dumb deal "stupid is as stupid does"
33
illusory promise
not a contract so theres no real commitment | making a promise with no intention in doing it
34
promissory estoppel
aka detrimental reliance no consideration in promise a reasonable person relies on a promise and can suffer substantial loss if the promise is not kept pledging to give church 100000000 dollars
35
contractual capacity
understanding the general nature of the contract
36
minors under 18 exceptions
contract is voidable on their end but on the opposing side the promise has to be kept 1. necessities 2. enlistment in military 3. marriage contracts 4. statute - insurance, banking, public transportation, student loans
37
disaffirmance - disafrim
minor voids the contracts can be done with words or actions may owe duty of restitution
38
ratification
minor accepts contract | can be done by words or actions
39
misrepresentation of age
common law - minor can still disafirm | trend - hold minor to contract where they misrepresent their age
40
intoxicated people what is he standard
if intoxicated at the time of entering into a contract the contract is voidable when you are sober you can ratify or disafirm standard: so intoxicated that you did not understand the nature of the contract RARE
41
adjudicated insane
court ruled person insane | AFTER they have been declared adjudicated insane any contract becomes void
42
unadjudicated insane
insane person returns to lucidity (normal sanity) - liable for restitution has right to disaffirm contract Voidable
43
legality
contracts must be legal unconscionable contract exculpatory agreement
44
unconscionable contract
grossly unfair contract one person has unequal bargaining power and takes advantage of the other person violates public policy
45
exculpatory agreement
releases one party from consequences of wrongful acts of negligence violates public policy
46
genuine and real assent to a contract
must freely and voluntarily enter into a contract
47
unilateral mistake
no relief | this contract is still bounded
48
mutual mistake
mutual mistake of value - no relief | mutual mistake of material fact - either party can void does have relief
49
fraud elements
misrepresentation intent to deceive justifiable reliance on misinterpretation innocent party injured
50
how is fraud used in contracts
con man - usually does not apply | duress someone forces another person into a contract MUST BE MORE THAN ECONOMIC THOUGH
51
why do statues of fraud exisit
to prevent fraud by claiming that a contract existed when in fact a contracts did not result - some contracts must be in writing
52
statues of fraud (5)
1. contracts that cannot be perfromed within a year 2. contracts for sale of goods over 500 3. contracts for transfer of an interest in real property 4. promise to perform obligations of others 5. promise made in contemplation of marriage
53
parole evidence rule
the written contract speaks for itself - cannot use oral evidence or extraneous evidence to try and contradict the contract
54
parole evidence rule exceptions (4)
subsequent modification of a written contract oral evidence to prove contract was void or voidable ambiguous or incomplete contracts prove a condition
55
discharge of contracts (6) page 5 study guide look at this
1. perfromance 2. breach of contract/incomplete performance 3. discharge by conditional contracts 4. discharge by agreements 5. discharge by impossibility 6. repudiation
56
remedies for breach of contract
explanation of remedies monetary damages - (compensatory, consequential, liquidated) equitable damages
57
why are written contracts better
easier to enforce helps people remember terms more accurately old days persons word was bond better than oral
58
conditional subsequent
after
59
conditional precedent
before
60
conditional concurrent
during
61
Agreement R's
rejection - offeree says no revocation - offeror takes back offer or says no
62
non offers
preliminary negotiations advertisements auctions - meets reserve - probably valid - ebay
63
communication of the offer is when reward?
the offeree receives it must know of reward to collect the reward (lost dog)
64
irrevocable offer
option contract- exclusive rights
65
termination by law 3 (valid - unenforceable)
1. intervening legality - change in aw terminates offer 2. subject matter of offer is destroyed 3. insanity death of offeror or offeree
66
to accept a contract the contracts acceptance requirements are
must be unconditional (must be exact - mirror image rule) must be unequivocal (word or conduct must be definite) must be legally communicated (mailbox rule)
67
unilateral acceptance
performance is acceptance trend - substantial amount of work complete
68
consideration R's
reliance / estoppel
69
detrimental reliance
aka promissory estoppel no consideration in promise a reasonable person relies on a promise and can suffer substantial loss if the promise is not kept pledging to give church 100000000 dollars
70
contractual capacity R's valid void or voidable
ratification - valid voidable - disaffirm restitution - payment of something
71
unconscionable contract
grossly unfair
72
exculpatory negligence
wrongful acts of negligence
73
genuine and real assent
must freely and voluntarily enter into the contract
74
mistake relief unilateral bilateral
must be bilateral to rescind MUST BE OF MATERIAL FACT - buying 10 acres when its really 9 unilateral - no relief
75
fraud
innocent party gets out
76
duress
signing contract against his or her will | and must be more than economic
77
duress lacks
genuine and real assent
78
undue influence
tv evangelist - nurse taking care of someone
79
undue influence lacks
genuine and real assent
80
R's
revocation - offeror takes offer back rejection - offeree says no ratification - agree to terms of contracts rescission - both parties agree to terminate the contract without performance repudiation - prior to performance one party says I am not going to do it reformation - correcting small unintentionally typos - math
81
other name for consequential damages
special damages

Mgmt 211 (4 decks)

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