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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
a promise made by one party in exchange for the promise of another party; a promise for a promise
Elements of valid offer 2
Definite and certain terms such as subject matter, price, quantity, quality, and parties
Five ways to terminate offer
1. Revocation by offeror before acceptance
2. Rejection by offeree
3. Death or incapacity of offeror
4. Destruction of subject matter or subsequent illegality of subject matter
5. Lapse of time/ failure of conditions specified in offer
acceptance becomes effective on dispatch (when sent by mail), revocation becomes effective only when received by offeree
Something of value, given in exchange for something else of value, that is the product of a mutually bargained for exchange
Consideration Rule # 1
For a promise to be legally enforced by the courts, there generally must be consideration
One party makes a promise knowing other will rely on it, other party relies on promise, only way to avoid injustice is to enforce the promise
Consideration Rule #4
Past consideration does not constitute consideration for purposes of present contract
Consideration Rule #5
Promise to do something you are already legally obligated to do is not valid consideration
Pre-Existing Duty role
1. Performance of a duty you are obligated to do under the law is not good consideration
2. Performance of an existing contractual duty is not good consideration
Under which 1 party agree to purchase its entire requirement of specific goods or services exclusively from another party for a specific period of time. No consideration
a contract in which you promise to deliver your entire output to the other party who promises to accept it
Mental ability to understand rights and obligations established by contract, with the presumptive ability to understand how to comply with terms of agreement
Contractual Power of Avoidance(Disaffirmance)
Minor's right, until a reasonable time after reaching age of majority, to disaffirm, or avoid, their contracts, Designed to discourage entering contracts with minors
Takes place when the individual, on reaching age of Majority, states orally or in writing that he or she intends to be bound by the contract.
Takes place when minor, reaching majority, evidences and intent to abide by the contract.
Legality of contracts
Contracts must have a legal exchange as its subject matter and must be able to be performed legally. Otherwise the bargain is illegal
Intentional, untruthful assertion of material fact by contracting party
Persuasive efforts of dominant party, who uses special relationship to unduly persuade the other party
One party has so much bargaining power that he effectively dictates terms of contract, resulting in other party lacks free will
Statute of Frauds
Rule of state law requiring certain types of contract to be in writing in order to be enforceable
Parole Evidence Rule
oral statements cannot be used to change or contradict the terms of a clearly written contract
Privity of contract
Relationship between parties to a contract, allowing them to sue each other but preventing a third party to do so
A third party for whose benefit a contract is formed. An intended beneficiary can sue the promisor if such a contract is breached.
Third party who benefits from contract in which promissor agrees to pay promisee's debt
Third party who benefits from contract in which promisor agrees to give a gift to third party
A third-party beneficiary who has not contractual rights but benefits from a contract even though that is not the intent of the parties to the contract. Cannot sue
Discharge by Material breach
Party unjustifiably fails to substantially perform his contractual obligations
Party decides, before actual time of performance, not to complete contract obligations. Anticipatory breach
Accord and satisfaction
Used when one party wishes to substitute a different performance to his original contractual duty
Designed to put plantiff in position he would have been in had contract been performed
Forseeable damages outside the actual contract, result from the breach. Breaching party must have known of the special circumstances.
Designed to punish defendant and deter him and others from engaging in similar behavior in the future
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