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Business Law I > Unit 5 > Flashcards

Unit 5 Flashcards

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1
Q

Statutes of Frauds

A

require certain kinds of contracts to be evidenced by a signed writing 457

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2
Q

The statute of frauds applies only to ______ contracts

A

executory 457

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3
Q

what is an executory contract?

A

contract made by 2 parties in which the terms are set to be fulfilled at a later date. The contract stipulates that both sides still have duties to perform before it becomes fully executed.

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4
Q

executory contracts are often in place between a _______ or ______ and another party.

A

debtor or borrower

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5
Q

If an oral contract has been completely performed by both parties but was not in writing as required per statute of Frauds would ____ be grounds for rescission of the contract

A

NOT 457

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6
Q

A contract that is in writing but fails to comply with the Statute of Frauds will be ______, however a party who has conferred some benefit on another my still recover the _____ ____ of their performance based on ________

A

unenforceable, reasonable value, quasi-contract 457

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7
Q

Type of contract in which the guarantor agrees to pay the debt or obligation that the principle debtor owes the obligee if the principle debtor fails to perform (pay).

A

collateral contract 458

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8
Q

when a person undertakes an obligation that is not conditioned on the default of another person, his obligation is said to be _____, not ________

A

original, collateral 458

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9
Q

when a contract is determined to be collateral ……….

A

it is only enforceable when in writing 458

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10
Q

any contract that creates or transfers an interest in land is within the _____ ____ ____

A

statute of frauds 458

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11
Q

No writing is required where the guarantor makes a collateral promise for the main purpose of obtaining some personal economic advantage….which exception to the statute of frauds is this?

A

main purpose or leading object rule 458

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12
Q

Any contract that transfers of land interests, or permits the removal of minerals on land is within the _____ ____ ____ and thus, must be evidenced by _______.

A

statute of frauds, writing 460

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13
Q

in land purchases, the vendee is?

A

the purchaser of the land 461

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14
Q

Part performance (Action in reliance) by the vendee (2 elements)

A
  1. vendee paid part or all of the purchase price

2. made substantial improvements on the property or took control of it 461

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15
Q

a bilateral _______ contract that cannot be performed within 1 year from the day it comes into existence is ____ the ____ ____ ____

A

executory, within, statute of frauds 461

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16
Q

executory contracts that cannot be performed within 1 year must be __________

A

evidenced in writing 461

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17
Q

contracts for an indefinite period of time are _______ the statute of frauds 461

A

not within 461

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18
Q

Contracts for the sale of goods for the price of $500 or more are ______ without writing or other specified evidence.

A

Not enforceable 463

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19
Q

____ writing is required when an executor or administrator, promises to pay the decedent’s debts from the funds of the _______ ______

A

NO, decedent’s estate 463

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20
Q

contracts where marriage is a consideration require

A

writing because it is within the statute of frauds

465

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21
Q

contemporary example of marriage provision to statute of frauds

A

prenuptial agreements 464

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22
Q

an actual contract is NOT always required to satisfy the written part of the statute of frauds, thus a __________ will suffice.

A

memorandum of the parties’ agreement 465

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23
Q

memorandum of the parties’ agreement requirements (2)

A
  1. the essential terms of the contract must be stated.

2. must be signed by the party to be charged (party using the statute of frauds as a defense). 465

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24
Q

memorandum for goods to be sold requirement under UCC (3 things)

A
  1. indicates the existence of a contract
  2. States the quantity of goods to be sold
  3. signed by the party to be charged (party using statute of frauds as a defense). 466.
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25
Q

UCC alternative means of the satisfying the statute of frauds in sale of goods contracts (4).

A
  1. confirmatory memorandum between merchants
  2. part payment or part delivery
  3. admission in pleadings or court
  4. specially manufactured goods 466
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26
Q

Promissory estoppel

  1. a promise that induces action or forbearance can be ________ notwithstanding the statute of frauds in the ______ was foreseeable to the person making the promise
  2. and if injustice can be avoided only by _____ the contract
A

enforceable, reliance, enforcing 470

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27
Q

the term Parole Evidence means?

A

Written or spoken statements that are not contained in the written contract. 470

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28
Q

The Parole Evidence Rule

A

When parties entered into a written contract that they intend as a complete integration, a court will not permit the use of evidence of prior or contemporaneous statements to add two, alter, or contradict the terms of the written contract. Essentially the written contract supersedes. 470

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29
Q

Parole evidence rule _______ evidence of statements made ____ or _____ the signing of the contract ONLY. Evidence ______ is admissible.

A

excludes, prior, during. after 471

30
Q

merger clause

A

also called integration clause, provides that the written contract is the complete integration of the parties agreement. 471

31
Q

In contracts that are partially printed and partially handwritten, ________ provisions will prevail

A

Handwritten 474

32
Q

usage

A

When both parties to the contract are members of a trade, profession, or community in which certain words are commonly given a particular meaning. Example: if a bakers dozen equals 13 then it will be treated as such by the courts. 474

33
Q

Illegality

A

Doesn’t necessarily mean it is illegal, rather an agreement is unenforceable because it violates public policy that has been developed by COURTS, or manifested in

  • constitutions
  • statutes
  • administrative regulations
  • or other sources of law 435
34
Q

When one parties agrees to perform an act regulated by state law for which they are not properly licensed the agreement will be _______. This applies when the purpose of the statute is _______ .

A

unenforceable, regulatory 437

35
Q

Where the licensing statute was intended primarily as a revenue raising measure, that is, as a means of collecting money rather than as a means of protecting the public, an agreement to pay a person for performing act for which she is not licensed will generally be ______ .

A

enforced 438

36
Q

regulatory statutes are intended to …….

A

protect the public 437

37
Q

Generally, statutes that require proof of character and skill and impose penalties for violation are considered to be _______ in nature.

A

Regulatory 438

38
Q

Statutes that pose a significant license fee and allow anyone who pays the fee to obtain a license are usually classified as _______ raising.

A

Revenue 438

39
Q

Agreements in restraint of competition: if the sole purpose of the agreement is to restraint competition, it ______ public policy and is ______.

A

violates, illegal 438

40
Q

The seller or employee agrees not to engage in a particular competing activity in a specified geographic area for a specified time after the sale of the business or the termination of the employment:

A

Ancillary covenant not to compete or “noncompetition clause” 438

41
Q

courts enforce noncompetition clause if they meet these 3 standards:

A
  1. Clause must serve a legitimate business purpose (MUST be ancillary to another contract).
  2. the restriction on competition must be reasonable in time, geographic area, and scope
  3. should not impose an undue hardship on the individual or the public 439
42
Q

Clause must serve a legitimate business purpose (2 examples)

A

protecting goodwill or trade secrets 439

43
Q

would a noncompetition clause made after an employee is terminated be enforceable?

A

no because it must be made ancillary “part of” to another contract 439

44
Q

Contracts in which a stronger party is able to determine the terms of the contract, leaving the weaker party no practical choice but to adhere to the terms

A

Contracts of the adhesion 445

45
Q

The use of FinePrint or inconspicuously placed terms, complex, legalistic language, and high pressure sales tactics are all examples of facts pointing to ________

A

unconscionability 446

46
Q

Lack of voluntariness as shown by a marked in balance in the parties’ bargaining positions, particularly where the weaker party is unable to negotiate more favorable terms because of economic need, lack of time, or market factors.

A

procedural unconscionability 446

47
Q

When factors in a contract are oppressive, unreasonably one-sided, or unjustifiably harsh

A

Substantive unconscionability 446

48
Q

A court may use the word adhesion to describe ______ ______ .

A

procedural unconscionability 448

49
Q

A contract is said to be ______ —-that is, the legal part can be separated from the illegal part– if the contract consist of several promises or asked by one party, each of which corresponds with the act or a promise by the other party

A

divisible 452

50
Q

Where no separate consideration is exchanged for the legal and illegal parts of an agreement, the agreement is said to be _______

A

Indivisible 452

51
Q

Two situations in which people who are not parties to a contract have legally enforceable rights under it:

A
  1. when a contract has been assigned (transferred) to a third-party
  2. when a contract is intended to benefit a third party (a third-party beneficiary) 478
52
Q

The transfer of a right under a contract is called an ______

A

Assignment 479

53
Q

The appointment of another person to perform a duty under a contract is called a _______

A

Delegation 479

54
Q

A person who owes a duty to perform under a contract is called an ______

A

obligor 479

55
Q

The person to whom a party owes the duty is called the ______

A

obligee 479

56
Q

The person who transfers the right to receive the obligors performance is called the ______

A

assignor 479

57
Q

The person to whom the right to receive the obligor’s performance is transferred is called the _______

A

assignee 479

58
Q

The money owed to the business by customers and clients is called ______ ______

A

Accounts receivable 479

59
Q

And _________ should promptly notify the obligor of the assignment.

A

assignee 482

60
Q

failure by the assigner who fails to notify the obligee of the assignment may cause the obligor to ____ be liable for payment to the wrong assignee.

A

NOT 482

61
Q

If after an assignment is made the obligor fails to pay the assignee because of some circumstance such as they disaffirm due to lack of capacity then the assignee ______ hold the assigner liable.

A

could (because an assignment is implied to be warrantied unless expressly stated otherwise) 483.

62
Q

a _____ of duties occurs when an obligor indicates his intent to appoint another person to perform his duties under a contract

A

delegation 484

63
Q

The delegator remains liable to the _____ unless the _____ agrees to substitute the delegatee’s promise for that of the delegator.

A

obligee, obligee 484

64
Q

The mere delegation of duties, even when the delegatee assumes those duties, _______ release the _____ from his legal obligation to the obligee. If the delegatee fails to perform the ______ would be liable to the obligee and also the delegatee could be liable to the_______ for breach of contract.

A

doesn’t, delegator, delegator, delegator 487

65
Q

A substituted contract in which the obligee agrees to discharge the original obligor and substitute a new obligor in his place:

A

novation 487

66
Q

Third-party contract

A

Contracts intended to benefit a third party thus giving the third-party the power to enforce it 489

67
Q

Third-partys to a Third-party contract are called

A

third-party beneficiaries 489

68
Q

Incidental beneficiaries acquire ____ _____ under a contract

A

No rights 489

69
Q

If the promisor’s performance is intended to satisfy a legal duty that promisee owes to a third-party, the third-party is a _____ _____

A

creditor beneficiary 490

70
Q

If the promise’s primary purpose in contracting is to make a gift of the agreed-on performance to a third party, that third party is classified as a _____ _____

A

donee beneficiary 490

71
Q

give an example of a donee beneficiary

A

the beneficiary to a life insurance policy 490

Business Law I (7 decks)

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