Week 10 & 11 Contracts (Exam 2)

Question 1

What is a contract?

Answer 1

Is an agreement voluntarily made by two or more parties.
Is used to formalize relationships involving exchanges of personal services or goods.
Creates enforceable obligations recognized at law

Question 2

Types of Contracts

Answer 2

Formal and Informal

Bilateral and Lateral

Question 3

Formal v. Informal Contracts

Answer 3

Formal is a contract made legally enforceable and binding (written contract)
Informal is NOT (handshake)

Question 4

Bilateral v. Unilateral

Answer 4

Bilateral is a binding arrangement between two parties where each promises to perform an act in exchange for the other party’s act (you scratch my back, I scratch yours)

Unilateral is an agreement to pay in exchange for performance, if the potential performer chooses to act (I’ll give you $20 to bring me something eat. Bringing something to eat is the acceptance)

Question 5

5 basic elements of a contract

Answer 5

Offer and Acceptance
Consideration
Capacity
Intent and Specificity
Legality

Question 6

Offer

Answer 6

Promise to do or refrain from doing something in the future

Question 7

4 material terms of an offer

Answer 7

Parties (offeror – offeree)
Subject matter
Time and place
Consideration (price to be paid)

Question 8

Acceptance

Answer 8

take the form of expressed act(s) or implied by conduct

Question 9

Capacity

Answer 9

Ability or power of a person to enter into a contract
Should satisfy legal qualification
legal age
soundness of mind

Question 10

Consideration

Answer 10

Exchange of a value (e.g., price to be paid)
Sponsoring a half-court shot event
exposure to media - $$$ prize
prize indemnity insurance

Question 11

Intent and Specificity

Answer 11

There must be serious intent on the sides of both parties for a contract to be enforceable (Sharp et al., 2007).
Must be precise enough

Question 12

Legality

Answer 12

A contract must be legal for it to be binding.

Question 13

Errors in contracts (4)

Answer 13

Misrepresentation
Undue influence/duress
Mistake
Integration and Parole Evidence

Question 14

Misrepresentation

Answer 14

When the facts were intentionally or unintentionally
misconstrued
    Concession
       10% of total sales?
       Team performance

Question 15

Undue Influence/Duress

Answer 15

Persuaded unfairly
Position and power
Forced, threatened…

Question 16

Mistakes

Answer 16

Rewrite the contract

Mutual vs. unilateral mistakes

Question 17

Integration and Parole Evidence

Answer 17

“AS IS”
No other previous agreements that would add to or detract from the contract will be allowed
Contract will be upheld as written

Question 18

Defenses for contractual breach (3)

Answer 18

Impossibility of performance
Frustration of purpose
Contractual impracticability

Question 19

Impossibility of performance

Answer 19

the contract cannot be performed

Question 20

Frustration of purpose

Answer 20

the contracted matter no longer has any value

Question 21

Contractual impracticability

Answer 21

the contract has become unreasonable and, therefore, impractical

Question 22

Classifications for contractual breach (3)

Answer 22

Reliance of damages
Restitution damages
Expectations

Question 23

Reliance Damages (damages of non-breaching party)

Answer 23

Money damages that are awarded to an innocent party for the losses suffered due to reasonable reliance on a promise

Question 24

Restitution Damages (benefits of breaching party)

Answer 24

Money damages that are awarded to an innocent party to

compensate for the benefit that party gave

Question 25

Expectation (damages of non‐breaching party)

Answer 25

Damages awarded to compensate the loss of future income caused by a breach of contract

Question 26

Sport Facility-Related User Agreements (5) GELFS

Answer 26

Facility Contracts
Game Contracts
Event Contracts
Sponsorship/Agreement Contracts
Licensing Agreement