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LGLS 1901 Final
Terms in this set (65)
Elements of a Contract
Elements of an Offer
1. Objective Intent
2. Reasonably Definite Terms
Promise for a promise.
Promise for a performance.
A change in the terms of the offer by the offeree.
Withdraw. (exception with option contract)
Mirror Image Rule
Offer must be accepted exactly, with no modifications.
Rules on Advertisements
Not offers, unless the offeree is asked to do something for a reward that the offeree is not required to do.
Bargained for exchange of value, must either benefit promisor or detriment to promisee
Types of Non-consideration
Detrimental Reliance (Promissory Estoppel)
legal principle that a promise is enforceable by law, even if made without formal consideration, when a promisor has made a promise to a promisee who then relies on that promise to his subsequent detriment.
A requirement of a valid contract in which the party is of proper age or sound mind.
Contracts with Minors & Mentally Disabled
Voidable through disaffirmance if value is returned to promisor.
Certain cases (food, medical care, shelter, etc.)
Legal Subject Matter
Subject matter of contract must be legal (ex: licensing for professionals, crimes, illegal interest rate).
All elements present.
Missing an element.
Minor or non-adjudicated incapacitated person can disaffirm.
1. Violations of statute of limitations
2. Violations of statute of frauds
Statute of Limitations
The time period within which an aggrieved party must institute suit or the claim will be forever barred.
Statute of Frauds
The requirement that certain agreements be in writing in order to be enforceable by the court.
(real estate, goods over $500, promises to answer for debt of another).
A sum of money that will return an aggrieved party to the status quo as though nothing ever happened.
Those losses in a breach of contract that are foreseeable, reasonably certain and unavoidable
Provide a remedy where a technical wrong has been committed but no actual harm as resulted.
Little or not financial loss, "chump change".
Punitive (Exemplary) Damages
A sum of money awarded to punish the tort committer for his or her misconduct so that the type of incident in question will never occur again.
Generally not available for mere breach of contract.
A sum of money agreed upon by contracting parties in advance that will be paid in the event of a default or breach of contract.
Enforceability of Liquidated Damages
1. When contract was entered into were damages difficult to estimate?
2. Was the amount set as damages reasonable and not excessive to the point of punishment?
Types of Equitable Remedies
2. Specific Performance
An equitable order issued by a court that directs a person to do something.
Need to prove immediate and irreparable harm.
Court order to not do something.
Court order to do something.
An equitable remedy for breach of contract that is used when money damages are inadequate to make the aggrieved party whole.
Usually involves sale of land, one-of-a-kind goods, specifically manufactured goods.
Never in contracts for services.
A remedy to prevent one party from benefiting at the expense of another.
Both parties must return goods, property, or money previously conveyed.
Remedy whereby a contract is cancelled.
Allows a contract to be rewritten to reflect the parties' true intentions.
Process by which legislative and executive actions are subject to review by the judicial system.
A business owned by only one person
An agreement between two or more people to share a common interest in a commercial enterprise and to share profits and losses.
Partners and directors are tasked with a duty of care and loyalty. Act as general agents to one another and the business entity.
Sale of shares is restricted
No SEC filings
Board & Officers are usually same people
Limited Liability Company
LLC is not taxed, profits go directly to owners
Publicly Traded Corporation
Company taxed as its own entity, stock can be sold freely.
Piercing the Corporate Veil
When the corporation is being misused so that the shareholders are treated like partners and have unlimited liability for the organization's debts.
Business Judgement Rule
Required that directors of a business use their best judgement in making decisions for the corporation.
Immunizes a director from liability for bad decisions.
Not required to manage "in hindsight".
Articles of Incorporation
The formal application for a corporate charter with articles must contain the proposed name of the business, the term, number of shares, and information about the initial corporate officials.
The taking and carrying away of property of another without consent and with the intention of depriving the other of the goods permanently.
Occurs when someone takes ownership to property that has been entrusted to him/her with a fraudulent intent to deprive the owner of that property.
Receiving Stolen Property
Intentionally obtaining property of another that has been stolen, or believed to be stolen.
"Known or should have known"
"The fence" - market for stolen goods.
Larceny plus the additional requirement that the taking be accomplished by force or threat of force.
The entering of a building, dwelling, or occupied structure not open to the public at the time with the intent to commit a crime.
An agreement between two or more parties to commit an unlawful act or do a lawful act in an unlawful manner
White Collar Crime
Associated with professionals
Amount deprived from US economy is much more than blue collar crime.
The use of a victim's personal information to obtain a financial advantage, such as the misappropriation of a credit card or money from a bank account.
Offering something of value to another with the intent of influencing that person's official decision or have something done in return by that entity.
Both official & commercial.
The offer itself is the crime.
Occurs when corporate insiders, such as officers, directors, and employees, buy or sell stock in their own company based upon information that has not yet been released to the public.
A crime involving the concealment of the real source of illegally obtained money by having a third party claim ownership to the currency
Determined by amount stolen.
Elements of Fraud
1. Material misrepresentation
2. Reliance on misrepresentation
3. Economic injury (or potential for)
4. Intent to deceive
Classical Insider Trading
Inside trader with information.
Misappropriation Insider Trading
Non-insiders who use confidential information (accountants, attorneys).
A scheme to defraud a creditor through the filing of a bankruptcy petition or the making of a fraudulent representation concerning a bankruptcy.
Refers to the agent or employee of a company who has the authority to bind to the business when he/she acts within the scope of authority.
Wire and Mail Fraud
Any fraudulent scheme to intentionally deprive another of property or honest services via mail or wire communication.
Powers of Administrative Agencies
No determined constitutional power, act under the scope of what statutes created by legislature allow.
Corporate Directors vs. Offiecers
Directors: elected, guide overall business plan.
Officers: appointed, manage day to day operations.