Business 5, 6, 7, 9, 11, 13

airbud123's version from 2015-10-07 23:42

Section 1

Question Answer
voidno legal affect
unforceable contractagreement that is not currently binding
voidable contractenforceable agrrement that may be set aside
express contractterm of agreement specified in words
implied contractcontract with major terms implied by parties conduct
formal contractcontract with special form or manner of creation; seal, recognizances, and negotiable instrument.
simple contractcontract that is not formal.

Section 2

Question Answer
Executory contractterms not fully carried out by all parties
Executed contractterms have been fully performed
Unilateralcontract calling for an act in consideration for a promise
Bilateralcontract consisting of mutual exchange of promises
Quasi-ContractRights and obligations imposed by law with no real contract, no agreement by parties required

Section 3

Question Answer
A valid contract is created bythe agreement of the parties.
Two essential elements of an offer (1) an offer, either express or implied, and (2) an acceptance, either express or implied
offerorparty making the offer
offereeparty accepting the offer
requirements of a valid offeroffer must be definite, offer must appear to be seriously intended, offer must be communicated to the offeree

Section 4

Question Answer
invitations to make offersApparent offers aren’t all true offers, Apparent offers can be invitations to the public to accept,Such as advertisements, window displays, catalogs, etc.
offeror may revoke an offer anytime before its acceptance
an option cannot be revoked at will
an offer is terminated by whatlapse of time specified in the offer
what automatically terminates an offerdeath or insanity

Section 5

Question Answer
Rejection of the offer by the offeree and communication of the rejection to the offero terminates the contract
If the performance of the contract becomes illegalthe offer is terminated
Contracts that Cannot be AvoidedContracts of Minors for Necessaries, Minors’ Business Contract, Educational loans.Legal duties, Medical care.
Unilateral mistakemade by one party to a contract
Mutual mistakemade by both parties to a contract

Section 6

Question Answer
Fraud in the InducementParty intended to make a contract based on false statement of terms or obligations of transactions
Fraud in the ExecutionDefrauded party did not intend to sign a contract when nature of writing could not be understood
Four elements of Fraud1. Misrepresentation, 2. Must be made by one who knew it to be false or made it in reckless disregard of its truth or falsity, 3. Must be made with intent to induce the innocent party to act. 4. The innocent part justifiably relies on the false statement and makes a contrac
Passive FraudIf relationship is based on trust and confidence, silence may constitute passive fraud
Innocent MisrepresentationFalse statement made in belief it is true
Physical DuressWhen one party threatens the other with physical violence into a contract

Section 7

Question Answer
Emotional DuressOne party’s threat affects psychological ability of the other to act under free will
Economic DuressWhen one party financially threatens the other into a contract
Rescindto set a contract aside. Return what you received under the contract.
After rescission, one can1. Bring a suit to recover any money, goods, or other things of value given up, plus damages,If the contract is executory on your part, you may refuse to perform. If the other party sues, you can plead mistake, fraud, duress, or undue influence as a complete defense, 3. Bring a suit to have the contract judicially declared void., If a written contract does not accurately express the parties’ agreement, you may sue for judicial correction of the contract (reformation)
reason for written contractsExistence of contract cannot be denied if written, Terms of contract can be ascertained, More reliable evidence than oral evidence
The following agreements must be written:An agreement to sell land or any interest in or concerning land, An agreement the terms of which cannot be performed within one year from the time it is made, An agreement to become responsible for the debts or default of another, An agreement of an executor or administrator to pay the debts of the estate from the executor’s or the administrator’s personal fundsAn agreement containing a promise in consideration of marriage, An agreement for the sale of goods over $500

Section 8

Question Answer
State specific written contracts 1. Sale of securities. 2. Agreements to pay a commission to a real estate broker. 3. A new promise to extend the statute of limitations.
Factors of fulfillment•1. Time of performance. •2. Tender of performance. •3. Tender of payment. •4. Satisfactory performance. •5. Substantial performance.
Discharge by Operation of Law1. Discharge in bankruptcy. •2. Running of the statute of limitations. •3. Alteration of written contract.
Voluntary Agreement of the PartiesParties can agree to not carry out the contract’s terms; it is then discharged
No contract is ever made if the act is impossible to perform. Common causes•1. Destruction of the subject matter. •2. New laws making the contract illegal. •3. Death of physical incapacity of a person to render personal services. •4. Act of the other party.
Rescindset aside or cancel

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