Chapter 10- Contracts and Sales: Introduction and Formation
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savannahrey on November 1, 2011
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51 terms
Terms | Definitions |
|---|---|
 contract | 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 |
| Common law- | traditional notions of law and the body of law developed in judicial decisions |
| Uniform Commerical Code (UNCC) | set of uniform laws (49 states) governing commerical transactions |
| Bilateral Contract | Contract of two promises; one from each party |
| Unilateral Contract | contract made up of a promise for performance. |
| Express contract | written or verbally agreed-to contract |
| Implied contract | contract that arises from parties' volunteer conduct |
| Quasi contract | theory for enforcing a contract even though there is no formal contract because the parties behaved as if there were a contract |
| Implied-in-fact contract | contract that arises from factual circumstances, professional circumstances, or custom |
| Void Contract | contract with illegal subject matter or against public policy |
| voidable contract | contract that can be avoided legally by one side |
| unenforceable contract | agreement for which the law affords no remedy such as when a contract must be evidenced by a writing or record and is not |
| Offer | preliminary to contract;first step in formation |
| Offeror | person making the offer |
| Offeree | recipient of offer |
| Revocation | offeror canceling offer |
| Options | offers with considerations; promises to keep offer open |
| Merchant's firm offer | written offer signed by a merchant that states it will be kept open |
| Counteroffer | counterproposal to offer |
| Battle of the Forms | UCC description of merchants' tendency to exchange purchase orders, invoices, confirmations, and so on;under Revised UCC, the court detwermines terms after the fact looking at intent, forms used, and the UCC terms |
| Acceptance | offeree's positive response to offer |
| Mailbox rule | timing rule for acceptance |
| Consideration | something of value exchanged by the parties that distinguishes gifts from contracts |
| Charitable subscriptions | enforceable promises to make gifts |
| Promissory estoppel- | reliance element used to enforce otherwise unenforceable contracts |
| Statue of frauds- | state statutes governing the types of contracts that must be in writing to be enforceable |
| Merchants' confirmation memorandum- | UCC provision that allows one merchant to bind another nased on an oral agreement with one signature |
| Parol evidence | extrinsic evidence that is not admissible to dispute an integrated unambiguous contract |
| Contract | 1. Set of promises for breach of which the law gives a remedy 2. Defined in restatement of contracts- American Law Institute |
| Common Law | appliesto contracts with subject matters of land or services. (ex. mortgages, lease) |
| The Uniform Commerical Code (UCC) | 1. Common Law is not uniiform from state to state 2. ALl and National Conference of comissioners on Uniform State Laws drafted it 3. First appeared in 1940's. 4. Adopted in part or whole in all states 5. Article II governs contracts for the sale of goods 6. More liberal than common law 7. Reformed/revised again in 2003 |
| Electronic Signatures in Global and National Commerce Act of 2000 (E-sign) | a. Federal Law b.Mandates recognition of electronic signatures c. States cannot deny legal effect to e-signatures |
| Uniform Computer Information Transaction Act (UCITA) | a. Not widely adopted yet (Virginia and Maryland) b. Governs transactions in software c. Governs shrink-wrap and click-wrap contracts |
| Bilateral Contracts | Both parties promise something in exchange for another partie's promise (example: You promise to pay back money with interest and the bank promises to loan you the money) |
| Unilateral | One party p;romises something in exchange for performance Example: "Drive my car across the country and I'll pay you $500 plus expenses |
| Express Contracts | are written or oral agreements |
| implied contracts | are nonspoken, nonwritten understandings ex. when you go into a docto's office you have an implied contract to apy her for her services even thou you may not sit down and organize the details. |
| Law implies a contract where | ones does not exist to prevent unjust enrichment |
| Minor's contracts for necessares | are enforced in quasi contract since they are voidables |
| Void and Voidable Contracts | Illegal subject matter |
| Void Contract | is one to do something illegal or against public policy- neither side can ex. can't have contract to kill someone |
| Voidable Contracts | contracts in which one party has the right to end the contract ex. contracts of minors are voidable |
| Law tries to | put you in the position that you'd be in, had the contract been filled |
| A contract requires | 1. Offer 2. Acceptance 3. Consideration |
| Offer (parties) | a. person makers offer (offeror) b. person recieves offer (offeree) |
| Must have language that indicates intent to contract vs. negotiation | a. not just inquiry b. more than negotiation c. court uses an objective, not a subjective, standard (1) examine language (2) examine circumstances (3) examine the acitions of the parties |
| Communication to Offeree | a. offeree cannot accpet offer that never arrives b. ads are invitations for offers- not offers |
| Termination of offers | a. can be revoked anytime prior to acceptance |
| Termination of offers | 1. exception is option 2. offeror is paid to hold offer open 3. it is separate contract for time 4. second exception is UCC merchants firm offer off by merchant signed in writing states it will be kept open (irrevocable) for period stated (maximum of three months) |
| Termination by rejection | 1. offeree indicates "no" 2. rejection by changes in terms- counteroffer |
| Termination by counteroffer- UCC | 2. chan |
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