Legal Exam 1
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66 terms
Terms | Definitions |
|---|---|
 Contract | Offer, acceptance, consideration |
| express contract | oral or written in words |
| implied in fact contract | mutual promises of parties are inferred in their actions |
| implied in law contract | law implies contract under 5 elements: 1. P confers benefit on D 2. P expects payment 3. D does not expect to pay 4. P is not officious intermeddler 5. unjust enrichment of D (MAIN POINT) |
| Promise | 1. present contract consent (not just negotiation) 2. present assurance of willingness to enter bargain 3. would reasonable person conclude that a bargain exists? 4. what would observer believe outward manifestation to mean? |
| Offer | Promise + Bargain |
| Bargain | Benefit to the promisor? |
| Bilateral Contract | bargain for return promise |
| unilateral contract | bargain for complete performance |
| objective theory of contracts | apparent intent of parties? (Lucy vs. Zehmer) |
| mirror image rule | offer must be accepted on terms of original offer |
| counteroffer | change terms or add new terms to the offer-TERMINATES/OPERATES AS REJECTION |
| rejection | 1. express rejection 2. counteroffer ONCE OFFER IS REJECTED IT IS DEAD |
| revocation | must be communicated to the offeree and it must arrive. direct=express, indirect=offeree obtains reliable information showing that offeror has changed his mind ANY OFFER CAN BE REVOKED PRIOR TO ACCEPTANCE |
| firm offer | offer that states that it will stay open until a certain date |
| option contract | mini contract within a contract (I'll give you $1 to keep offer open for X days) nominal, in writing and signed by offeror -offer will not lapse even if offeror dies -counteroffer during option period does not terminate |
| implied in law option (unilateral) | the substantial beginning of performance by the offeree will make the offer irrevocable. |
| Minneanapolis RR | offer died with counteroffer and was dead at time of alleged acceptance |
| bilateral contract accpetance: "red flag" | offeree does not promise but performs an act that indicates a return promise=acceptance |
| silence constituting acceptance? | No, but exceptions: 1. offeree by words or conduct leads offeror to believe that silence is accpetance 2. insurance application 3. course of dealing: series of previous transactions between the same parties in the past |
| mailbox rule | -acceptance is effective when it is properly dispatched -rejection effective when it is received -revocation effective when it is received |
| consideration | bargain (same as offer) and legal detriment |
| legal detriment | doing, promising to do something that you arent already under a PED to do or forebearing/promising to forebear |
| PED rule | a promise to accept less than amount of liquidated debt where debt is dischargeable is not enforceable |
| liquidated debt | amount is certain |
| unliquidated debt | amount is uncertain or in dispute |
| illusory promise | not a "real" promise: leaves promisor a "way out" |
| exclusive agency contract | agency has exclusive right to sell product, consideration=best effort to sell product |
| requirements contract | consideration is good faith and best efforts not to go out of business |
| nominal contract | form of bargain is not equal, a give b 1M house for 1K. no consideration: only ok when: -in writing, signed by offeror, fair exchange in time, consideration is explained/mentioned |
| promissory estoppel | can be substituted for consideration when consideration is missing: 1. gift promise 2. promisor expects promisee to rely 3. promisee does rely 4. only way to avoid injustice is to enforce the promise |
| moral obligation/past consideration | promise is not enforceable. ex: A saves B's life. A is injured in process. B promises to pay medical bills. |
| capacity to contract: minors | voidable at the option of the minor until time of majority or a reasonable amount of time thereafter -disaffirm by returning object in any condition |
| capacity to contract: mental incapacity | voidable by incapacitated person at any time. |
| cognizance rule | person does not understand contract |
| informed decision rule | person lacks ability to communicate |
| adjuducation of insanity | person is declared insane prior to formation of contract: contract is void |
| intoxication/drugged | temporary incapacity |
| recission (unilateral) | 1. mutual mistake of fact 2. misrepresentation 3. undue influence 4. duress |
| mutual mistake of fact | ss peerless |
| misrepresentation | intentional (fraud), negligent , innocent |
| undue influence | 1. trust relationship 2. promisor was vulnerable to influence of promisee 3. promissee used excessive influence |
| duress | force or threats of force. economic duress is NOT a basis for recission! |
| statute of frauds (SOF) | contracts must be in writing to be enforceable 1. marriage (pre-nup) 2. sale/interest of land (IMMOVEABLE ITEMS) 3. sale of goods >$500 (MOVEABLE ITEMS) 4. Contracts by their own terms cannot be performed within a year (year begins day after) 5. suretyship |
| sufficient writing (statute of frauds) | -ID parties -subject matter -terms/conditions -consideration -signature |
| easements | right of way to walk across land |
| sale of goods: removal from SOF | -pymnt has been made AND accepted -goods have been received AND accepted -party being sued has admitted in court -specially manufactured goods |
| contracts that cannot be performed within 1 year: removal from SOF | complete performance by one party |
| suretyship | answer for someone else's debt. surety's promise ALWAYS goes to creditor |
| suretyship: removal from SOF | -leading object rule: promisor's purpose is to benefit economically -novation: 3 party agreement, all parties agree on new surety and original is removed from agreement -a promise to the debtor (not suretyship) |
| condition precedent | has to occur first to create absolute duty. {if temp reaches 90} i will sell katie my sunscreen for 50 temp=precedent |
| concurrent condition | mutually dependent performance based on near simultaneous performance (delivery of sunscreen and payment of 50) |
| condition subsequent (after) | extinguishes duty to perform (Katie will return sunscreen if it's used-->extinguish payment duty) |
| excuse of conditions | P must prove all conditions precedent and concurrent happened or were legally excused and that D breached a promise |
| voluntary disablement | 1 party makes it appear by conduct that he/she will not be able to perform |
| anticipatory repudiation (breach) | (BEFORE) if either party to a bilateral contract breaches by words indicating intent not to perform then other party can sue |
| discharge of absolute duty | 1. impossibility of performance 2. exercise of conditions subsequent 3. recission, mutual or unilateral (legal reason) 4. modification of contract (new consideration) 5. novation: 3 party agreement, 1st obligor is released and new obligor exists 6. accord and satisfaction |
| impossibility of performance | 1. superveneing illegality (after contract formation) 2. superveneing destruction of subject matter 3. death or illness in a personal services contract |
| accord & satisfaction | accord: legally suspend B's right to contract with A satis: discharges A's duty to perform |
| compensatory damages | pay back P for amount of grief caused by D |
| consequential damages | what would person anticipate that D should reasonably owe P? |
| doctrine of avoidable consequences | puts duty on P to try to minimize harm caused by D's breach |
| liquidated damages | certain amount expressed in contract, reasonable and not punitive |
| nominal damages | technical infraction but no real harm done |
| reformation | used when parties have imperfectly expressed their agreement in writing. re-written to match intent. (usually necessary due to clerical error). need greater proof: clear and convincing evidence of fraud/misunderstanding |
| personal services contract | cannot sue for specific performance (13th amendment violation) |
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