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Offer Acceptance Consideration Legality Capacity Consent Writing
Elements of a Contract
All contracts begin when a person or a company proposes a deal.
Once a party receives an offer, he must respond to it in a certain way
There has to be bargaining that leads to an exchange between the parties "Bargain for Change"
The contract must be for a lawful purpose
The parties must be adults of sound mind
Certain kinds of trickery and force can prevent the formation of a contract. "Meeting of the Minds"
While verbal agreements often amount to contracts, some types of contracts must be in writing to be enforceable.
A promise that the law will enforce
both parties make a promise (to do something) to each other = enforceable agreement
one party makes a promise to the other that the other party can accept only by doing something specific = until performance is complete REWARDS
Bilateral or
Revoked Completed reasonable
Common Law says that Offers can be _____ until performance is ______; Most states allow a _____ amount of time to complete
the two parties to the contract explicitly state all of the important terms of their agreement; May be Oral or Written; Enforceable Contract
the words and conduct of the parties indicate that the parties intended to make an agreement; Not Only words, but may include reasonable inference from actions and circumstances
Implied or
Contract Law
Employment Law is based in (At Will)
Demasse v ITT
Case where employee handbooks have protections by implication and IT employees with seniority had changes, but contract was implied
when one or more parties has not fulfilled its obligations under the contract.
when all parties to the contract have fulfilled their obligations under the contract.
_______ or Executed
Valid Unenforceable Voidable Void
Four V's of Contract Law (1 is actually a U)
satisfies the law's requirements; Must meet every requirement
when the parties intend to form a valid bargain but some rule of law prevents enforcement
Statute of Limitations
Law where Period of Time in order to Bring that Action; time period measured by time from breach of agreement
Statute of Frauds
Law where Writing Requirement
when the law permits one party to terminate the agreement
one that neither party can enforce, usually because the purpose is illegal or one of the parties had no legal authority
State Type
Statute of Limitations varies by _____ and _____
Quasi Contract
Third Possibility of Implied v Expressed; Implied at Law
Benefit Paid Aware Enriched
In order to prove quasi-contract, defendant must prove these three elements: -He gave some ______ to the defendant. -He reasonably expected to be ____ for the benefit and the defendant was ______ of this -The defendant would be unjustly _____ if she did not pay.
promise rely depended injustice enforce
Promissory Estoppel requirements: Defendant made _____, aware that plaintiff would ____ on it Plaintiff ____ on promise Only way to avoid ______ is to _____ promise
Quantum Meruit
Latin for Plaintiff gets what he deserved
Common Law Uniform Commercial Code Restatement of Contracts
Sources of Contract Law
Uniform Commercial Code 2
____ _____ ____Article _ governs the sale of goods. "Goods" means anything moveable, except for money, securities, and certain legal rights.
Mixed 2 Sale Goods
UCC - In a _____ contract, Article _ governs only if the primary purpose was the _____ of ______
Restatement of Contracts
defines a contract as a promise or set of promises for breach of which the law gives a remedy, or the performance of which the law in some way recognizes as a duty; general summary of the nature of common law contracts in the US; restatement of common law; states do not follow the same se…
Understanding Intent Reasonable Person
Three aspects of Meeting of the Minds: ______ and ____ ____ ____
Invitation to Bargain Advertisement Letter of Intent Definite
Components of an Offer: ______ ___ _____ and _____ aren't offers _______ __ _____ depends on writer's intent The term of the offer must be _______
Revocation Rejection Counteroffer Expiration Destruction
Five Terminations of Offer:
Termination by Revocation
Termination of Offer: Effective when the offeree receives it
Termination by Rejection
Termination of Offer: If an offeree rejects an offer, the ______ immediately terminates the offer.
Termination by Counteroffer
Termination of Offer: If an offeree _________, it is a rejection that immediately terminates the offer
Termination by Expiration
Termination of Offer: When an offer specifies a time limit for acceptance, that period if binding. If the offer specified no time limit, the offeree has a reasonable period in which to accept.
Termination by Destruction
Termination of Offer: ______ of subject matter terminates offer. Illegality of subject matter terminates offfer Death or incompetency of either the offeror or offeree terminates the offer
Written Offeror Period Consideration
In order for an offer to be irrevocable, it needs to be: _______, Signed by ______, Containing essential terms/conditions including ______ in which irrevocable, Supported by ______
An Irrevocable Offer _____ be revocable if the offeror transmits the offer to another person
Will predominant sale common services
In MIXED Contracts involving sale of goods and services, the UCC ____ govern if the ______ purpose is the _____ of goods, but ____ law will control if predominant purpose is providing _____
Article 2A
_____ __ governs the Leasing of Goods
UCC 2 204 Quantity Critical OPEN
___ _-___ states three rules: -The parties may make a contract in any manner that sufficiently shows that they reached an agreement (______ Term) -Knowing the moment of making of the contract isn't ____ -One or more terms may be left open (____ Terms) Commercially responsible terms wil…
The offeree must say or do something to ____
In a _____ contract, the offeree generally must accept by making a promise.
In a _____ contract, the offeree must accept by performing.
Mirror Image Rule
Requires that acceptance be on precisely the same terms as the offer; has been largely eliminated under the UCC Art. 2 Sale of Goods
Mailbox Rule
An acceptance is generally effective upon dispatch, meaning the moment it is out of the offeree's control.
If there are no requirements of acceptance, the offeree may accept in any _____ manner
UCC 2-207
Under this, an acceptance that adds additional or different terms may form a contract for sales of goods in certain cases.
contracts must be a two way street. If one side gets all the benefit and the other side gets nothing, then an agreement lacks ____ and is not an enforceable contract.
Measurable Value Bargained
Three Rules of Consideration: -Both parties must get something of _______ value from the contract. -A promise to give something of ____ counts as consideration. -The two parties must have _____ for whatever was exchanged and struck a deal: "If you do this, I'll do that."
Void Unenforceable
A contract that is illegal is ____ and _______
Restraint Trade Compete
____ of _____ - To be valid, an agreement not to _____ must be ancillary to a legitimate bargain.
Time Geographic Activity
In the sale of a business, when a non-compete agreement is ancillary to the sale of a business, it is enforceable if reasonable in ____, _______ area, and scope of _____
Trade Confidential Customer
A non-compete clause in an employment contract is generally enforceable only to the extent necessary to protect ___ ____, ______ information and _____ lists developed over an extended period.
Exculpatory Clauses
This is the part of a contract that attempts to release you from liability for injury to another party.
intentional negligence public interest unequal written
Exculpatory Clauses are unenforceable when: -it attempts to exclude an _____ tort or gross _______. -the affected activity is in the _____ _____, such as medical care, public transportation, or some essential service. -the parties have greatly _____ bargaining power. -it is not clearl…
Adhesion Contract
A "standard-form" contract, such as that between a large retailer and a consumer, in which the stronger party dictates the terms.
negligence intentional hidden
Which of the following exculpatory clauses will most likely be enforceable? -An exculpatory clause that relieves a riding stable of gross ____ -An exculpatory clause that relieves a riding stable from ____ torts. -A riding stable's exculpatory clause that is ____ in an eight-page docum…
An ______ contract is one that a court refuses to enforce because of fundamental unfairness
Oppression Surprise
Two factors that most often lead to unconscionability
In some cases, lack of capacity creates a ____ contract. (PERSONS ADJUDGED INCOMPETENT BY COURT)
A minor generally may _____ a contract; that is, he may notify the other party he refuses to be bound by the agreement. The minor also has the option of filing a suit to rescind the contract, that is, to have a court formally cancel it.
A minor who disaffirms a contract must return the consideration he has received, to the extent he is able.
Mentally Impaired Persons generally create only a ______ contract
When an intoxicated person makes a contract, it is ______.
______ Misrepresentation means the owner believes the statement to be true and has a good reason for that belief.
______ Misrepresentation means the owner knows that the statement is false
Falsity Material Reliance
Three Requirements to rescind a contract due to fraud and misrepresentation:
Rescission Damages
Plaintiff's Remedy for Misrepresentation or Fraud -  _____ or Suit for _______
Standish Schwartz
_______ v ______ - Fraud committed, intentional misrepresentation; Baseball Cards/ Photos
Previous Mistaken Writing Trust
Nondisclosure of a fact is misrepresentation only when disclosure is necessary: To Correct a _____ Assertion To Correct a Basic ______ Assumption To Correct a Mistaken Understanding about a ______  In A Relationship of ______
Undue Influence
In Bonds v Bonds, Sun's claim was _____ _______; Lawyer advised several times to get independent counsel
Bilateral factual error voidable
A ________ mistake occurs when both parties negotiate based on the same _____ _____. If the parties contract based on an important factual error, the contract is ______ by the injured party.
Uncertainty Rescission knows
In Conscious _______, No ______ is allowed where one of the parties _____ she is taking a risk
Unilateral Unconscionable Unmistaken
Sometimes only one party enters a contract under a mistaken assumption, a situation called ______ mistake. to rescind for unilateral mistake, a party must demonstrate that she entered the contract of a basic factual error and that either: (1) enforcing the contract would be _______ or  …
land 1 year debt estate marriage 500
Under the Statute of Frauds, agreements that must be in writing are: For any interest in ____ That cannot be performed within _ ____ To pay the ____ of another Made by and executor of an _______ Made in consideration of ______; and For the sale of goods over $____
Requirement for Statute of Frauds
Full Seller Part Buyer
The exceptions to the Requirement for Statute of Frauds Interest in Land are: _______ Performance by the _______ _______ Performance by the _______
Collateral Promise
Promise to pay debt of another
Defendant Name Subject Matter Terms
Requirements of Statue of Frauds Writing: The contract or memorandum must be signed by the ______ and It must state with reasonable certainty: the _____ of each party the _____ ______ of the agreement, and  all of the essential _____ and promises.
500 Defendant Parties
Under UCC 2-201, A contract for sale of goods worth $____ or more is not enforceable unless there is some writing, signed by the _______, indicating that the ______ reached an agreement.
Third Party Beneficiary
An intended beneficiary may enforce a contract if the parties intended her to benefit and if either: enforcing the promise will satisfy a duty of the promisee to the beneficiary or the promisee intended to make a gift to the beneficiary.
Assignment of Rights
A contracting party may transfer his rights under the contract
Delegation of Duties
A contracting party may transfer her duties pursuant to the contract
Obligor Law Validly Contract
Exceptions to Contractual Assignment: (a) would substantially change the _____'s rights or duties under the contract; or (b) is forbidden by ____ or public policy; or (c) is _____ precluded by the ____ itself.
Policy Prohibits Personal
Exceptions to Obligor Delegation: (1) delegation would violate public _____, or (2) the contract ______ delegation, or (3) the obligee has a substantial interest in ______ performance by the obligor
A contract terminated by mutual agreement is a _____ contract
Performance that is exactly what promised; is usually not expected and failure to do so does not cause for discharge
Value of Defects
Substantial Performance = Full Price - ____ __ _____
Unsubstantial Performance = Nothing but possible Value of ____
Type of Breach where courts will discharge only if a party committed a ______ breach, causing substantial harm
A court will discharge an agreement if performing a contract was truly ______ but not if honoring the deal merely imposed a financial burden
True Impossibility
something has happened making it utterly impossible to do what the promisor said he would do
Contract Personal Services Illegality
Elements of True Impossibility are: Destruction of subject matter of _______ Death of promisor in a ______ ______ contract _______
Compensatory Consequential Incidental
What are the damages awarded for Expectation Interest (3)?
This type of interest was designed to put the injured party in the position he would have been in had the parties never entered into a contract.
Designed to return to the injured party a benefit that he has conferred on the other party, which it would be unjust to leave with that person
When money is not sufficient to help the injured party, a court may order a transfer of property or may issue an injunction to prevent a particular action from continuing.
The most Common of Damages
Promised Breach Quantified Certainty
Compensatory Damages: They generally flow directly from the contract, such as an order to pay what was _____ or to pay for expenses caused by the _____. The injured party must prove the breach caused damages that can be _____ with _____ certainty.
Consequential Damages
Damages resulting from the unique circumstances of this injured party; Third Party Companies calculate these damages due to complexity
Incidental Damages
relatively minor costs incurred when the injured party responds to the breach (obtaining cover), such as the extra cost of buying replacement goods.
Equitable Interests
Specific Performance, Injunction, and Reformation are all components of ____ _____
Specific Performance
A court will order the parties to perform the contract only in cases involving the sale of land or some other asset that is unique
process in which a court will partially "re-write" a contract
Liquidated Damages
_____ _____ Clauses are when actual damages are difficult to determine
_____ of Damages - A party may not recover for damages that could be avoided with reasonable efforts
Restatement 205
The ______ of Contracts (___) states that Every contract imposes upon each party a duty of good faith and fair dealings in its performance and its enforcement
Warranties Negligence Strict Liability Fraud
Product Liability includes (4):
Express Implied
What are the two Warranty Types?
Demo Picture Blueprint Description Sample
An express warranty is one that the seller creates with his words or actions. Any affirmation of fact--or any promise--can create an express warranty, including: _____, ____, ______,  Any ______ of the goods can create an express warranty. Any ______ or model can create an express warr…
Grade goods Labeled Conform Equal
Implied warranty that goods are: Of average , fair or medium ____ quality Will pass, without objection in the trade or market, for _____ of the same description Be adequately packaged and ______ ___ to affirmations of fact or promises made on label or container Be of _____ quality an…
Implied Warranty of Fitness for a Particular Purpose: May or May not be a _____ Seller has reason to know _____ for use Seller has reasonable ____ and judgment of products
Oral Express Warranties
May be disclaimed by clear conspicuous writing
Written Express Warranties
May NOT be Disclaimed
Implied Warranties of _______ - may disclaim, but must use word "______" and the disclaimer must be conspicuous. ***NOTE: Many states prohibit a seller from disclaiming implied warranties in the sale of consumer goods.
Magnuson Moss
_____-____ Warranty Act Does not require: Manufacturers or sellers to provide a warranty on their products Any supplier that offers a written warranty on a consumer product that costs more than $15 to disclose the terms of the warranty in simple understandable language before the sale
Collector Carl displays his beer can collection at the local swap meet. Mary sees the collection and is interested in buying it. Carl says he will sell the collection for $1,500. Mary says she really likes the collection buy is only willing to pay $1,000. Mayr's counteroffer _______ Carl/…
In Writing One Year
Claude agrees to lease his house to Irvin for nine months, the lease to begin six months from the signing of the contract. Under the statute of frauds, the lease is required to be __ ______ because of the ____ ____ rule
A counteroffer is a ____ of the original offer.
Not Enforceable
An exculpatory clause is generally ___ _______ when it attempts to exclude an intentional tort or gross negligence.
Donee Creditor
A nonparty to a contract may enforce the contract if the person is a _____ beneficiary or _____ beneficiary
Wins Enforceable
Barb has been a children's day care provider for several years in the small town of Sallton. She has decided to give it all up and move to the big city for excitement and adventure. She sells her business to Ken, agreeing not to open a competing business within five miles of Sallton for a…
Executory Bilateral Express
Mike made the following offer to Mick: "I will pay you $500 if you agree to paint my house." Mick replied that he would. At this point, the contract is an _____, _____, _____ contract
Ratified Bound
Marty, a 16-year-old, contracted with Cream-of-the-Crop Cycles to buy an $8,000 motorcycle. He agreed to make monthly payments until the purchase price plus interest were paid in full. It is three years later and Marty has not disaffirmed the contract and has made regular payments on the …
According to the UCC, one or more open terms will not cause a sales contract to fail for indefiniteness as long as the parties intended to make a contract and there is a reasonably certain basis for the court to grant an appropriate remedy. True or False?
Frauds life business complex ongoing
You should have a signed written agreement when:  The Statute of ____ requires it The deal is crucial to your ____ or the life of your ______ The terms are _____ You do not have an _____ relationship with the other party.
contract statute obligor
any right or duty can be assigned or delegated unless the assignment or delegation is (1)prohibited by the _____, (2) prohibited by a ____, or (3) when an assignment will significantly change the risk or duties of the ______
A sitcom actor, exhausted after his 10-hour workweek, agrees to buy a briefcase full of cocaine from Lewis for $12,000. Lewis and the actor have a ___ contract.
contemporaneous oral
Two individuals signed a contract that was intended to be their entire agreement. The parol evidence rule will prevent the admission of evidence offered to prove the existence of a ______ ______ agreement modifying the contract
Full Performance
Most contracts are discharged by:
True Impossibility
Lenny makes K2, a synthetic form of marijuana, in his basement. He signs an agreement with the Super Smoke Shop to deliver 1,000 cans of K2 for $10,000. After the contract is signed, but before the deliver, Super Smoke Shop's state legislature makes the sale of K2 illegal. Lenny's contrac…
Direct Consequential
A manufacturer delivers a new tractor to Farmer Ted on the first day of the harvest season - but the tractor will not start. It takes two weeks for the right parts to be delivered and installed. The repair bill comes to $1,000. During the two weeks, some acres of Farmer Ted's crops die. H…
Expectation Interest
Julie signs a contract to buy Nick's 2002 Mustang GT for $5,000. Later, Nick changes his mind and refuses to sell his car. Julie soon buys a similar 2002 Mustang GT for $5,500. She then sues Nick and wins $500. The $500 represents her ____ _____.
Common Law
New consideration must be present for the modification to be binding if the deal is governed by _____ _____
Clarify Modernize Usage Agreement Uniform
UCC §1-102(2): Underlying purposes and policies of this Act are: 1. to simplify, _____ and ____ the law governing commercial transactions 2. to permit the continued expansion of commercial practices through custom, ____ and ____ of the parties 3. to make _____ the law among the various…
Agreement When Open
Under Article 2 of the UCC: 1. The parties may make a contract in any manner sufficient to show that they reached an _____. 2. The UCC will enforce a deal even though it is difficult, in common law terms, to say exactly ____ it was formed. 3. Under the UCC, a court may enforce a bargai…

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