Business Law Chapter 13: Contracts
Terms in this set (28)
4 Elements of a Contract
agreement, consideration, contractual capacity, legal capacity
A key factor in the agreement element of a contract; consists of the agreement of one party, the offeree, to the terms of the offer in the contract made by the other party, the offeror.
One of the four elements necessary for a contract; consists of an offer made by one party, the offeror, and the acceptance of the offer by another party, the offeree
A promise exchanged for a promise
The bargained-for exchange; what each party gets in exchange for his or her promise under a contract.
A promise or set of promises for the breach of which the law gives a remedy or the performance of which the law in some way recognizes a duty.
The legal ability to enter into a binding agreement.
covenant not to compete
An agreement not to compete against a party for a set period of time within a designated geographic area.
A term applied to a contract whose terms have all been fully performed.
A term applied to a contract whose terms have not all been fully performed.
A contract in which all the terms are clearly set forth in either written or spoken words.
A contract that must have a special form or must be created in a specific manner.
A contract that arises not from words of agreement but from the conduct of the parties.
A contract that requires no formalities. Also called simple contract.
lack of genuine assent
A defense to the agreement of a contract in which the offeree claims that the offeror secured the agreement through improper means, such as duress, fraud, undue influence, or misrepresentation.
letter of credit
A binding document that a buyer obtains from his or her bank to guarantee that payment for goods will be made to the seller.
A written document signed by a person who makes an unconditional promise to pay a specific sum of money on demand or at a certain time to the holder of the instrument; an acceptable medium for exchanging value from one person to another.
A key factor in the agreement element of a contract; consists of the terms and conditions set by one party, the offeror, and presented to another party, the offeree.
A rule of interpretation which states that words in a contract should be given their ordinary meaning.
A court-imposed contractual obligation to prevent unjust enrichment.
An obligation in which a party acknowledges in court that he or she will perform some specified act and/or pay a price on failure to do so.
A contract that is not a formal contract. Also called an informal contract.
A term applied to a contract that, because of a law, cannot be enforced by the courts.
Uniform Commercial Code
A statutory source of contract law in the United States that is applicable to transactions involving the sale of goods. The UCC was created in 1952 and adopted by all 50 states, the District of Columbia, and the Virgin Islands; it may be modified by each state to reflect the wishes of the state legislature.
A promise exchanged for an act.
A term applied to a contract that includes all four elements of a contract—agreement (offer and acceptance), consideration, contractual capacity, and legal object—and thus is enforceable
A term applied to a contract that is not valid because its object is illegal or it has a defect that is so serious that it is not a contract.
A term applied to a contract that one or both parties have the ability to either withdraw from or enforce.