Law for Accounting 7 5 12 Contracts Contract a binding agreement between two parties All the states in the union adopted the same rules about the sale of tangible movable goods horses cattle corn cell phones EXCEPT Louisiana This building is tangible but not movable Therefore it is under the common law Patented copyrights are not tangible so common law The only thing that is under the UCC Universal Commercial Code are tangible movable goods Steinberg vs Chicago medical school he finds out that some guy with lower criteria was accepted He sued for breach of contract because they said they would evaluate him based on these criteria and they did not Agreement offer and acceptance Capacity Consideration Legality Parties Promissory Estoppel is not a contract ON TEST you can leave out the quantity and a contract will still uphold if I make an offer you accept it then I die my estate is responsible for fulfilling that contract the destruction of the subject matter to which the offer relates will terminate the offer The Agreement Offer offer or selling car offer ee buying car o Elements of offer Intent to contract Preliminary negotiations o Would you pay 400 for my car PN o My best quote would be 400 offer o The price I am asking is 400 offer Reasonable person test Advertisements Offers made in excitement or jest auctions Definite terms communication o Duration and termination Lapse of time Operation of law Offeree s rejection Counteroffers I ll pay you 350 not an acceptance Once this is said it is a rejection The 400 is off the table Offeror s revocation Yes as long as he has not accepted Means of communication o Has to be communicated o Can silence be acceptance NO Except if they say if you keep these DVDs we will send you more every month that you will pay for a Only formal contract today is a check Involves 3 parties a There is only one promise so it is unilateral a ALL contracts require consideration I ll buy your book for 200 is an enforceable contract a Quasi Not REALLY a contract though a Contracts with minors are voidable The minor can get out of it but that sales man cannot a Not voidable by EITHER party only by one a some of the states did not adopt it EXACTLY there are some minor changes So identical is a false statement Acceptance o o QUIZ 1 1 False 2 False 3 False 4 False 5 True 6 False a 7 False 8 False 9 False 10 False 11 True a toy yoda or Toyota The offer is not what the offeror thought it s what a reasonable person would have thought a Because all the terms really aren t there in most advertisements So they are invitations for the public to come make an offer to them a You have to have received the offer Just because I put it in the mail does not mean you received it b Mail box rule is only for acceptances In order to accept it the moment I put it in the mail box I accept your offer the law considers it accepted It doesn t matter if the offeror knows or not or whether it gets to him or not c Does not apply under the common law only under the UCC a all offers must be communicated it is definite enough that you can accept it 12 False 13 False 14 False 15 True 16 False a 17 True 18 True a 19 True lapse terminate a The offeror does not NEED to receive the rejection 20 The UCC applies because the sale of a good is involved 21 Executed bilateral None of the Above 22 Invitation for the consumer to make an offer 23 Lius will win because it is the objective intent of the offeror 24 Bill wins because he accepted prior to revocation a If Bill knew Joe sold to Ed this would not be true 25 Five days from when the offer was received by Joe 26 The telephone acceptance is valid if received prior to the mailed rejection 27 M has waited too long to disaffirm a the court usually gives minors about 6 months after they turn 18 28 a Part one i E ii G iii F iv C v H vi I vii B viii J ix D x A restatement of contracts definition you need to know this b Part two i A ii E iii G iv D v H vi K J vii viii I ix F x L xi C xii B 7 6 12 Unit 2 Offer Acceptance Duress physical threats I hold a gun to your head and say sign this contract is that really consent No that s physical Duress in which case the contract would be VOID from the very beginning Social Duress I tell a girl if you don t sign this I m going to tell your husband where you were last night Economic Duress This is voidABLE because she would have to PROVE her reason for signing you sign this or I ll put you out of business voidable Undue Influence The person who is feeding them their pills and helping them bathe says hey I think you ought to sign over your house to me this person is of dominant position and influences them enough to make them do it That contract is void Fraud this watch is a Rolex and it is 2500 Buyer gets the watch checked out by a jeweler and it is actually not a Rolex Buyer can get his money back It cannot be an opinion such as I think this is a really valuable coin Even if it is an innocent false representation such as I thought it was a real Rolex Unilateral Mistake I think this is a rare coin you are responsible for your mistake Bilateral mistake we both think it is a rare coin set it aside Consideration both the offeree and the offeror give up something to their detriment Consideration can be forbearance the right to do something I ll give you 500 for your bumper DON T DO THAT Has to be bargained for today now o Hey thanks for helping me on the test I ll give you 50 This is in the past Doesn t count Pledge to a church or charitable group is the exception They will sue and say that there is consideration Quiz 2 When one contract is substituted for another the completion of the second contract is called the satisfaction The debt I owe my landlord for rent is liquidated because we know what it is it is not in dispute I take my car in to get fixed I come back thinking it will be 250 but they fixed something else and now it is 750 This is unliquidated because it is in dispute The courts don t care if you put in a dime or a dollar they just care that you did SOMETHING Therefore they are not concerned with the adequacy of consideration The …