Test 4 Review – Alvin Stauber BUL3310-01All class examples that could appear on the test are included and there are a few examples that I have included that should be more relatable. All of the underlined portions of FL Statutes and Case Studies from the Target Copy are copied into this study guide and summarized accordingly.The Study guide is divided into three sections and follows the logical flow of the information rather than the flow of Stauber’s classes; though everything from pg. 70-101 in the Target Copy is thoroughly covered.I. Intro to Contracts & Mutual AssentII. Consideration & CapacityIII. LegalityAnything highlighted is a definitionAnything highlighted in green is review***Designates information to rememberIf there are references to page numbers from 1-25, it is referencing this packet. If there are references to page numbers from 70-101 it is referencing the Target Copy. Go through this packet twice. Good Luck.You do not have permission to copy, reproduce, or distribute this text without the express written consent of the author.BUL3310 Test 4 Study Guide Contracts – A legally enforceable agreement. There must be:1. An agreement a. The objective Theory of Contracts – We can only rely on what can be objectively manifested **( Meeting of the minds – Agreeing to the same thing at the same time) Ex: Seller of a horse sends a letter to the buyer with an offer to sell his horse for $2200. Buyer agrees and sends the seller a check for $2200. Seller gets the check and says “Wait, I was trying to sell the horse for $2500, not $2200! We don’t have an agreement.”Buyer comes back and says “You made the offer in writing for $2200, it doesn’t matter what you were thinking.” If taken to court, buyer would win because it’s not up to the buyer to know what the seller was thinking. 2. Obligation – There must be a legal duty to fulfill ita. Not a moral or ethical (that falls under a social agreement)Types of Contracts1. Express – agreement manifested in words (oral or written)a. Terms were exchanged b/w persons2. Implied – agreement manifested by conductEx: going to the dentist; you get a cavity filled. Dentist sends you a bill for $500. You’re outraged, no one told you he was going to charge you $500. Why else would you have shown up though? $500 is a little ridiculous, so you take him to court…a. ***In an implied contract all the terms of the contract must be impliedly reasonable. So back to the example, you argue that $500 is an unreasonable amount to get a cavity filled, so you come into court with quotes from 6 other dentist offices for filling a cavity and the average is about $150. Theoretically, the judge would rule that you only owe $150 instead of the $500 because that’s a reasonable amount. 3. Unilateral – promise for an act. “You scratch my back…” (Funny thing about my back though…)Ex: Reward for a lost dog. Ex: Tell a real estate agent if you sell my house you’ll get 6%a. In Both instances, it doesn’t matter how much work you put in anticipation of the required act. You can’t say, well it took me 28 days to find your dog. It won’t change the reward.4. Bilateral – Promise for a promise (most common)a. Each person promises something; DOES NOT have to be written.BUL3310 Test 4 Study Guide 5. Executory – Not yet performed. (a futures contract)6. Executed – Completely performedThere’s a difference between a social agreement and a business contract2 guys make a bet to buy the winner of a bet to see who can chug a beer the fastest a dinner at Shula’s Steak house. One of the guys wins (obviously) but the other refuses to honor their agreement. The winnertries to take his boys to court. Would never be heard in court because it is a social agreement, there is no legal obligation for them to keep their word, only a moral or ethical one. Same thing if you tried to hold someone accountable for standing you up on a date.However, there was one success in Broward County: Girl sued a guy for standing her up at her senior prom (what a dick). She won because she had spent all this money on a dress, hotel, limo, etc. on the premise that the guy was going, so it ended up being more of a business agreement then a social agreement. *Marriages ARE heard in court. Marriages are business agreements because there are so many assets that are involved.**in Florida we allow both pre-nuptial and post-nuptial agreementsReview-Know the 6 types of contracts: (1) Express (2) Implied (3) Unilateral (4) Bilateral (5) Executory (6) Executed-Know that implied contracts must be impliedly reasonable.-The Objective Theory of Contracts says that interpretation of contracts must only be objective (what can be manifested) not subjective (in someone’s mind). -An enforceable contract is one that has a legal obligation vs. a moral or ethical obligation (social agreement)-A contract MUST: have an agreement AND have legal obligation.Elements of a Valid Contract (4)BUL3310 Test 4 Study Guide 1. [1/4] Mutual Assent (the offer & its acceptance) A. Offer – Promise to do something for something in return***Essential Elements:1. A promise to render a stated performance in return for the requested counter performance.a. Promissory language requirement (wtf?)-Basically, it’s making an offer in a manner that shows serious intent (oh)Ex: I promise to buy/sell….Ex: I will buy/sell….Ex: I hereby undertake the obligation to buy/sell…b. Effect of equivocal language: You’re not firmly stating your intent and this would not be a valid way to create an offer.-“sitting on the fence” Ex: I am thinking about buyingEx: I am considering buyingEx: I am contemplating buying2. Essential terms must be certaina. Avoid ambiguous language-Describe with specificity what the offer is about (Subject matter)-Who are the parties involved? (Must indicate)-Quantity? (How much?)-What are the financing terms? (Interest rate? Payback period?)3. Promise must be communicated under circumstances which manifest present, serious contractual interest.a. You have to TELL the person (let them know somehow: written, oral)b. Must be seriousi. Ex: “I’ll give you a million dollars if you tattoo your face.” You’re an idiot if you actually do, no one was serious. Class Example: Bar advertises that they will pay $5 per year for the period between this year (1980) and the year of an event depicted on a t-shirt.1980 – 1969 (Woodstock) = 11 years x $5 = $55. For the
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