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Business Law And Contracts

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Updated 2006-10-28 00:38

Business Law: Contracts

TermDefinition
Contractpromise 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.
Common Lawtraditional notions of law and the body of law developed in judicial decisions
Restatement (Second) of Contractsgeneral summary of the common law of contracts by the American Law Institute (ALI)
Uniform Commercial Code (UCC)set of uniform laws (forty-nine states) governing commercial transactions
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Types of Contracts

TermDefinition
Bilateral contractcontract of two promises; one from each party.
Unilateral contractcontract made up of a promise for performance
Express contractwritten or verbally agreed-to contract
Implied contractcontract that arises from parties' voluntary conduct
Quasi contracttheory for enforcing a contract even though there is no formal contract because the parties behaved as if there were a contract
Implied-in-fact contractcontract that arises from factual circumstances, professional circumstances, or custom
Implied-in-law contractlegally implied contract to prevent unjust enrichment
Void contractcontract with illegal subject matter or against public policy
Voidable contractcontract that can be avoided legally by one side
Unenforceable contractagreement for which the law affords no remedy
Executed contractcontract that has been performed
Executory contractcontract not yet performed
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How are contracts formed?

TermDefinition
Offerorperson making the offer
Offereerecipient of the offer
Course of dealingUCC provision that examines the way parties have behaved in the past to determine present performance standards
Revocationofferor canceling offer
Optionsoffers with considerations; promises to keep offer open
Merchant's firm offerwritten offer signed by a merchant that states it will be kept open
Counteroffercounterproposal to offer
Battle of the formsUCC description of merchants' tendency to exchange purchase orders, invoices, confirmations, and so on with the mutual understanding that they have a contract; under Revised UCC, the court determines termsafter the fact looking at intent, forms used, and the UCC terms
Acceptanceofferee's positive response to offer
Mailbox ruletiming rule for acceptance, referring to the case where stipulated means are specified for offer acceptance; if the offeror has required the acceptance to be mailed and the offeree properly mails the letter of acceptance, the acceptance is effective when it is sent, not received.
Considerationsomething of value exchanged by the parties that distinguishes gifts from contracts; sometimes referred to as bargained-for exchange. what each party - offerer and offeree - gives up under the terms of the contract.
Charitable subscriptionsenforceable promises to make gifts
Promisory estoppelreliance element used to enforce otherwise unenforceable contracts; used as a substitute for consideration in cases in which someone acts in reliance on a promise that is not supported by consideration.
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When must contracts be in writing?

TermDefinition
Statute of fraudsstate statutes governing the types of contracts that must be in writing to be enforceable
Merchants' confirmation memorandumUCC provision that allows one merchant to bind another based on an oral agreement with one signature
Parol evidenceExtrinsic evidence that is not admissible to dispute an integrated unambiguous contract
CISGContracts for the International Sale of Goods; a proposed uniform law for international commercial transactions
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