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BUL 3130 Test 3 Ch 9-12

Terms in this set (110)

What are the 6 elements required to exist in order to create a valid binding legal contract?
ICLACO
1) Intent
2) Capacity
3) Legal Subject Matter
4) Acceptance
5) Consideration
6) Offer
If one or both of the parties to a contract do NOT have _______(1)_______, the contract is ______(2)_________
1) Intent
2) Void
If any of the elements, aside from intent, does NOT EXIST then the contract is _________________________
Voidable (Meaning one of the parties can walk away without liability)
Intent (ICLACO)
-Sometimes known as mutual asset (agreement) proven by actions and words
-Evidence of it can be seen by totality of circumstance
Capacity (ICLACO)
-Affected by age, infermity, medication, being drunk, even if someone is incapacitated in their mind; if they have a lucid time, they can contract
i.e. If someone gets married while drunk, marriage can be voided or ratified
Capacity (ICLACO) of a Minor
- If responsible adult in the life of an underage cannot provide necessities: they can contract for food, clothing, shelter, and insurance.
-Can avoid all contracts and not be civilly liable, but can still be criminally liable
- If this is missing the contract is voidable
Legal Subject Matter (ICLACO)
-The reason for the contract must be legal
-The purpose for the contract must be lawful
Acceptance (ICLACO)
-It follows the offer 99.5% of the time
-Can be expressed or implied
-Can be oral or written
-Can be acting in accord with the offer doing what is asked
-Mirror Image
Consideration (ICLACO)
-Requires a fair value to be a part of the bargain
-Can be a service for a service
-Can be a monetary payment for a service
-Can be barter (Service for a service)
Offer (ICLACO)
-Without this there will never be a contract.
-It can be oral or written
-It can be expressed or implied
-It can be interpreted by many actions or words.
"RELAXED" being the definition of which ICLACO?
-Intent, Capacity, Consideration
Oral Contract
-A contract created verbally
Written Contract
-A writing evidencing the contract is created when the contract is formed
Express Contract
-A contract statement that may be oral or written
-Clearly stated as to the terms and provisions of the contract
Implied Contract
-Contract comes about by the words or conduct of one of the parties
Bilateral Contract
-Both parties are in agreement with the terms and performance will take place immediately or at some designated future time
Unilateral Contract
-Considered a one sided agreement, where an offer is made that has (1) yet to be accepted by a reply or by
(2) performance of what the offer requires.
i.e. Man asking another to cut his grass
Void Contract
-Means no contract ever existed in law and the parties are free from any legal responsibility under the terms and provisions of the agreement/contract
-Intent does not exist
Voidable Contract
-A contract wherein one of the parties can challenge one or more of the elements of the contract and therefore bears right to affirm/disaffirm the contract.
-Where one party of a legal contract has the right to void a legal obligation
-The party to a contract who has the option of performing according to the terms of the contact or being free from any responsibility thereunder
-Capacity is lacking
-Flaw; Legal subject matter is not right
Mirror Image Rule
-(Common law) the offer and acceptance are identical and creates a valid binding legal contract
Mailbox Rule
-(Common law) acceptance of an offer legally takes place when the acceptance is placed in the US Mail with adequate postage and addressed as the offer requested (on line contracts are accepted when you click on the icon indicating acceptance of the offer)
E-Sign Act
-Electronic Signature
-It satisfies the statue of frauds for a signature
Statute of Frauds
-Common Law
-Breach of Contract lawsuit
-If a contract cannot be performed within 12 months of being entered into it must be written in order for it to be enforceable
-Applies to 5 areas of law
-If someone violates this and is damaged, damages will never be able to be recovered
-Online in the world of e-commerce; remember to copy and print all aspects of the online negotiation so you have proof of the contract
- $5000 or more, it need to be in writing to be enforced
Statute of Frauds applies to contracts between merchants when the sum is $___________ or more
- $5,000
Parole Evidence Rule
-Contract Law
-Prevents oral testimony that would contradict any term of a written contract
-Doctrine has some limited exceptions to that rule
CounterOffer
-A says to B, I will sell you my Jaguar for $128,000-. B says I will pay you $122,000. B made a counteroffer, which in law ended the existence of the offer which A never has to re-offer
Force majeure clause
-Contract Law
-For international contracts this clause permits a party to be free of a contract if there is a political insurrection or a natural disaster
Executory Contract
-Contract in which terms are incomplete
Executed Contract
-The contract has been formed and completed-or- all terms of contract are agreed to and performance thereunder is to take place sometime in the future (if the future means more than 1 year from contract formation-it must be written and signed because of the Statute of Frauds)
Trademark
-Design, logo, phrase, distinctive mark, or word that a manufacturer prints on their product to readily identify itself ie Target
Trade Dress
-A product's distinctive design, packaging, color, or other appearance, which makes it unique from other products/goods. (Look & Feel of product)
-Protected under trademark law and Lanham Act
Lanham Act
-In common law, recognition of right to intellectual property. Allows a person to register a symbol with the patent and trademark office in Washington, D.C.
Lanham Act Details
(1)A private citizen can be allowed a search and seizure order in a courtroom once they prove someone has imitated their product and (2) Trade names cannot be registered under the Lanham Act
Lanham Act Advantages
-Nationwide notice of the trademark owners claim
-Legal presumption of the registrants ownership of the mark in the event of a dispute
Copyright Law
-Form of protection provided by the laws of the US (title 17, US code) , The Copyright Act of 1976, to the author's of "original works of authorship," including books, poems, etchings, songfs, etc. (rights of literary property as recognized by law)
Five owner rights given by Copyright Law
(1) reproduce work
(2) publish or distribute work
(3) display
(4) perform work in public
(5) prepare derivative works based on the original
Patent
-A property right granted to an investor "to exclude others from making, using, offering for sale, or selling the invention throughout the United States or importing the invention into the United States" for a limited time in exchange for public disclosure of the invention when the patent is granted
-20 Years of protection
-May take 2-3 years to process
-Common law will always be there, but don't count on it
3 Main Categories of Patents
(1) Design-Protect new/original designs for articles of mfg.
(2) Utility-Protect useful processes, machines, matter, etc. or
(3) Plant- Protect invented or discovered, asexually reproduced plant articles
1 Year and 1 Day Intellectual Property Law
-The law says an inventor cannot apply for a patent once he/she has put the invention in the stream of commerce and let time lapse/expire
Non-Disclosure Agreement (NDA)
-AKA Confidentiality Agreement
-A contract you require anyone you consult about your original creation (poem, play, etc) to sign and which prevents disclosure of the information you provide in order to obtain expert advice
-If contract is breached, you may have a lawsuit therefor
International Bureau of World Intellectual Property of Organization
-File for an international trademark protection
-File for an international intellectual law protection
Trade Secrets Contract
-Protects your patent
-Information is not known by the competition
-The business world would lose its advantage if the competitor were to obtain it
-The owner has taken reasonable steps to protect the information from disclosure
ie formula, pattern, device or compilation of info used in one's business
What are 4 types of negotiable instruments?
1)Checks
2)Drafts
3)Notes
4)Certificates of Deposit (CD)
-Unconditional order or promise to pay
Checks
-"Draft drawn on a bank and payable on demand"
-Considered most common form of draft
Drafts
-Form of order t pay that is payable at a later date and may use a bank, individual or corporation
-Is a conditional promise to pay
-There is a condition on the promise
Notes
-Form of promise to pay by one party, called the maker, to pay a certain sum of money to another party, the payee, also known as promissory notes, involving two parties ( payer and payee)
Promissory Note
-Legally considered to be a note as identified by the UCC
-The binding legal document that must be signed by both parties for a loan
Certificate of Deposit (CD)
- UCC "acknowledgment by the bank " that it has received money deposited from a client with promises that the bank will repay the money at a future date in addition with interest.
-Written document
All promises to pay are negotiable instruments?
-False
When depositing a draft it is worthless until conditions are met? T or F
-True
How many party instruments are for check and drafts?
-3
How many party instruments are for Notes and Certificate of Deposits?
-2
Negotiable Instruments are now a part of what law through Article 3 of UCC?
-Commercial Law
What is UCC?
-Uniform Commercial Code
Purpose of UCC
-To simplify, clarify, and modernize law governing commercial transactions
Article 2 of UCC
-Sale of Goods
-Defines as tangible and moveable goods/products
-Has to be able to be moved from one location to another
-Sale is when ownership and title pass between the buyer and seller
Article 3 of UCC
-Applies to Negotiable Instruments
-Must be written
-Initially were created to as a written promise or order to pay a certain sum of money
-This document helped create credit for debtors and was a substitute for case
What is the strict common law requirements of ICLACO so that commerce could flow swifter and less expensively called?
-Relaxed
Let's say a contract is a mix of goods and services and the contract does not specify common law or UCC. Which Law governs the dispute?
-The rule is to look to whether goods or services DOMINATE the contract. If services dominate (installation, maintenance, etc) then common law governs it
- If goods DOMINATE (movable things) then UCC dominates it
Convention on Contracts for the International Sale of Goods (CISG)
-Adopted by the United Nations
-It is a treaty
-Similar to the UCC adopted by the states
-It prevails over the UCC because it is a treaty
-Parties to a contract can exclude it applying by so stating same in their contract and by providing what law will apply to their contract
A treaty is the same as a ?
-Convention
Primary source of international law is found in?
-Treaties
Treaties
-Contracts between our government and that of another entered by the president
-Approved by 2/3 of the senate
Doctrine of Respondeat Superior
- Creates liability on the principal (employer and agent (employee) for acts committed by the agent in the scope and course of employment
-Can be a negligent act; intentional act; crime, misrepresentation, fraud, etc
Implied Warranty
-Unwritten, unexpressed promise or guarantee that a court infers to exist accompanied by the good(s).
- A quality and safety standard imposed by Article 2 of the UCC that is automatically imposed on sellers unless they specifically disclaim them.
-An unwritten guarantee that the product is of sufficient quality to fulfill the purpose for which it was designed
Expressed Warranty
- A promise in addition to an underlying sales agreement that goes beyond the terms of the sale agreement which the promisor assures the description, performance, or quality of the goods
-A specific promise as to quality, safety, performance, or durability of goods
Quantum Meriut
-Contract Law
-You are entitled to be paid the reasonable value of your services and material in a contract action when you have completed the work and the buyer refused to pay because of some "minor" difference in what was contracted for
Implied Warranty of Fitness for a particular purpose
-Buyer orders a good with a special use in mind
-The buyer is required to demonstrate reliance on the seller's expertise
Statute of Limitations
-Time frame that governs when a lawsuit ,may be filed before it becomes void or nonenforceable
-Time allowance subject to change from state to state
Name 3 types of torts
1)Intentional
2)negligence
3)strict liability
Condition Subsequent
-Marker bringing an end to one's legal rights or duties
ie Paying alimony until ex wife enters into a marital relationship
Condition Precedent
-Forming a contract with a condition attached to it
ie Grandmother paying grandson $10000 for finishing college in 4 years and not smoking cigarrettes
Domain name
- It assigns name and owners
Cyber Squatting
- Trademark improperly used
Which 3 of the Common Law protects you when you file your idea?
1)Trademark
2)Trade Dress
3)Copyright
Trade Name
- The "name" of your business, whether incorporated or not
-Protected by the common law, not under the Lanham Act
-Generally, the first to use a "name in a geographic area is the owner of it
What are considered goods among merchants?
-Goods are "all thing" which are moveable at the time of identification to the contract for sale
-Must be moveable and tangible (physically exist)
Covenant Not to Compete
-A contract term requiring certain restrictions of current employee's future employment when employee resigns or is fired
-Courts frown on broad restrictions and do not uphold such contract terms if they would cause unemployment
-Focus on a time and geographical restriction of an employee
-Court's routinely revise such time and geographical limitations when unemployment for a lengthy period of time would be the outcome of this term/provision of an employment contract
ie "A" agrees not to compete with present employer for 3 yrs in the SE US upon employment contract ending. In effect this could make one contracting away one's ability to work for 3 yrs in an expansive area. If before a court, the court may reduce the time to 1 yr and limit the geography to one or two states
Fair Use Doctrine
-This is the right of persons other than the owner of copyright material to use it in a reasonable manner without conside of the owner
Infringement
-If copying is not authorized
Counterfeits
-An example of infringement
-Draws sales away from original mark holder
All promises to pay are negotiable instruments T or F
-False
When depositing a draft, it is worthless until conditions are met... T or F
-True
Secured Creditor
- Creditor is able to get some of their nonpaying customers property back to satisfy a debt
Exemption Law
-What you can deem exempt from bankruptcy
State exemption from your equity in your home is?
-Florida 100%
-Georgia 40%
Homestead law
-Law that allows debtor to retain family home up to a specified amount
Mechanic Lein
-Only relates to real estate or real property, never personal property
-Can place a lein on property for unpaid bills
Monetary Damages
-Most common remedy for breach of contract
Restitution
- May be used to prevent unjust enrichment
-The court can order payment to be made or goods involved to be returned
Rescission
-Both parties agree contract is terminated without performance
Duress
-Forced to sign a contract
Novation
-Discharge one party and contract with another who takes on the responsibilities on the previously discharged party
You can make a counter offer to an electronic agent. T or F
-False
Everything illegal is unethical... T or F
-True
Fidiciary
-A position of trust, loyalty, and confidence between two or more parties that create a contract
-Formal and legal consequences apply if broken
Accord and Satisfaction
-An agreement to offer and accept some performance different from than originally bargained for
Satisfaction
-The actual performance of the new obligation which discharges the original claim
Patent law is purely statutory, and not known to any common law doctrine... T or F
-True
Caveat Emptor
-Buyer Beware
Formal Contract
-Under seal
Bankruptcy Law is found where?
-Bankruptcy Code and identified by Chapters
-Exclusively Federal Law in Federal bankruptcy Courts designed to handle such case
Administrative Chapters dealing with location of courts, filing fees (Bankruptcy)
-Chapters 1, 3, 5
Operative Chapters (Bankruptcy)
-Chapters 7,9,11,13
Chapter 7
-Fresh start in that you can by 100% relieved from having to pay any debt you owe subject to a creditor(s) taking from you such items of property that is/are eligible under law to be seized.
-Since the change, several years ago in the Bankruptcy, you can be asked by the Court to pay some of the debt you owe, this the new Code does not always eliminate all your debts (depends on nature of case)
Chapter 9
-Reserved for governments, municipalities, cities
Chapter 11
-For businesses only; allows for payment of debts over a period of time not to exceed 60 months. Debtor retains assets. Allows company to restructure. Typically involves reorganization seeking to keep business in tact while seeking protection from creditors
Chapter 12
-Reserved for family farmers and fisherman. Similart to Chapter 13, but extends addt'l benefits beyod those available to ordinary U.S. wage earners
Chapter 13
-Reserved for a people (not a business) that can be given the opportunity to pay its debts over a period of time not to exceed 60 months
-It permits the debtor to retain its property while trying to pay its debts
-Known as a consolidation of debts that can occur, if approved by the court according to the financial plan submitted by the debtor to the Court and creditors
Stay Law
-Once bankruptcy has been filed, all creditor must stop calling and all lawsuits will stop
-They will watch for the disclosure
THIS SET IS OFTEN IN FOLDERS WITH...