Term
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Definition
| offer, acceptance, consideration, capacity, lawful purpose |
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Term
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Definition
| 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 as a duty. |
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Term
| Void contract versus Unenforceable contract |
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Definition
Void - was never a contract because it was unallowable from initiation
Unenforceable - a valid contract that does not meet some sort of requirement, and therefore cannot be enforced. |
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Term
| Common law versus Sales contracts |
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Definition
| Common Law applies to real estate and personal services, while the Uniform Commercial Code ("sales rules") applies to goods. |
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Term
| Mutual assent versus Objective theory |
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Definition
Mutual Assent - the parties agree on the same exchange
Objective Theory - the intent is measurable and tangible, and not an unexpressed thought. |
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Term
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Definition
Offer - proposal to form a contract
Option - offer that cannot be terminated by offeror alone. typically achieve option by giving some collateral. |
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Term
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Definition
| An acceptance is effective when it is dispatched, not when it is received. All other motions are effective when received. |
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Term
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Definition
| When a party who relies on a promise which is technically not a contract, but is justifiable relied upon and causes the party detriment, the court can enforce the promise. |
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Term
| Rescission versus Ratification |
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Definition
Rescission - to be restored to pre-contract state. A remedy for lack of mutual assent.
Ratification - a willingness to continue with a contract despite a lack of mutual consent. |
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Term
| Fraud versus Misrepresentation |
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Definition
Fraud - requires a false statement of a material fact, the false statement to be made with the intent to deceive, and the false statement being justifiably relied on.
Misrepresentation - does not require that the false statement be made with an intent to deceive. |
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Term
| Duress versus Undue Influence |
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Definition
Duress - a contract entered into because of force or compulsion. May be rescinded.
Undue Influence - Unfair persuasion of a contracting party where that party is vulnerable to the other. |
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Term
| Legal Sufficiency of Consideration versus Legal Adequacy of Consideration |
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Definition
Sufficiency - Whether a party confers a benefit or suffers a detriment. Necessary for a contract to be enforceable.
Adequacy - whether consideration is a "fair trade." Generally not considered by courts. |
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Term
| Bargained Exchange versus Mutual Assent |
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Definition
Mutual Assent - the parties agree on the same exchange
Bargained Exchange - Helps determine if a contract has sufficient consideration. Considers what both parties bargain for. |
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Term
| Problems related to consideration |
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Definition
Past consideration - completed before contract
Preexisting duty - promising to do something you already have to do
Illusory promise - appear to create a duty or obligation, but do not
Debt settlement - agreements to pay only unliquidated debts are allowed |
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Term
| Violation of Statute versus Violation of Public Policy |
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Definition
| A contract the violates a statute is void and thus not a contract. A contract that violates public policy is illegal and unenforceable, but does not technically violate law. |
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Term
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Definition
Requires the following contracts to be made in writing:
1) interest in real estate
2) contracts to pay the debt for another party in the event of failure by that party
3) long-term (more than 1 year) contracts
4) promises to pay the debts of the estate of another party |
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Term
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Definition
| Prohibits use of contract-altering evidence in courts unless it is to resolve ambiguities, establish fraud or other defenses, or establish subsequent modifications to a written contract. |
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Term
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Definition
| Defines the relationship between members in a contract. Typically third parties are not included. |
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Term
| Third-Party Beneficiaries |
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Definition
| Can be included in privity if that is the intent of the contract, in the case of donee beneficiaries and creditor beneficiaries. Not incidental beneficiaries. |
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Term
| Assignment versus Delegation versus Novation |
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Definition
Assignment - transfer of a contract right
Delegation - transfer of a contract duty
Novation - substitution of one party for another written into contract's terms. |
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Term
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Definition
Condition Precedent - must happen before contract applies
Condition Subsequent - contract applies until condition is true.
Concurrent Conditions - promises that must be performed at the same time. |
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Term
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Definition
| A contract term is not technically complete, but substantial work has been performed. Typically the court will grant recovery of the amount it would cost to remedy that specif term of the agreement. |
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Term
| Compensatory damages versus Consequential damages versus Nominal damages |
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Definition
Compensatory - to replace direct, and easily measurable damages caused by breach of the contract.
Consequential - less measurable and direct, typically. These damages are the result of a special circumstance caused by the breach of contract.
Nominal damages - an acknowledgement that a breach has occurred, but a very small sum of damages is required. |
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Term
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Definition
| A contract provision written in advance to determine the amount of money that would be awarded in a contract breach. Requires that the amount required for damages in the event of a breach would be difficult to calculate, and that the amount be reasonable, and not a penalty. |
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Term
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Definition
| Only required when monetary remedies would not be adequate. May require a party to perform the specific request of the contract. |
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