Contract and Tort Law Flashcards

Flashcards on contract and tort law.

Major breach

Breach of a significant or essential term (a “condition”).

Minor breach

Breach of a non-essential term (“a warranty”).

Express repudiation

Clear communication of an intention to NOT perform as promised.

Repudiation

When one party’s actions make their performance impossible.

Major Breach

Goes to the heart of the contract. There can be discharge of the contract.

Minor Breach

Does not result in discharge of the contract, but the non-breaching party can claim damages.

Anticipatory breach

Occurs BEFORE the required performance.

Failure to perform

Occurs at the time of performance. Must be MAJOR failure.

Restitution

If a mistake leads to unjust enrichment, the court will order _.

Damages

Money.

Equitable remedies

Specific performance and injunction.

Quantum meruit

Giving what is reasonable.

Expectation damages

The expected benefit of performance (had the contract been fulfilled).

Consequential damages

The subjective expectation of the individual based on the specific circumstances.

General damages

The estimated amount for intangible injury.

Reliance damages

The cost incurred in reliance on the contract.

Punitive damages

When there is bad faith or malicious behaviour.

Damages

Compensatory NOT punitive.

Liquidated damages

A genuine pre-estimate of damages.

Nominal damages

Acknowledge a valid claim.

Punitive Damages

Only awarded in exceptional circumstances for “malicious, oppressive, and high handed” misconduct that “offends the courts sense of decency”.

Exemption clause

A term that either limits or excludes a party’s liability.

Limitation of liability clause

Sets a maximum dollar amount for any claims.

Exclusion clause

Insulates from certain types of liability (waivers).

Indemnity

Parents/guardians of minors can be asked to sign an __ agreement wherein they agree to indemnify the establishment for any damages payable to the minor.

16(a)

Seller has the right to sell the goods (SGA).

16(b)

Goods will be free from any charge or encumbrance in favor of any third party, not declared or known to the buyer when the contract is made (SGA).

17(1)

If goods are sold by description, they must meet that description (SGA).

SGA

Sale of Goods Act.

Sale of goods

The exchange of current or future goods for monetary consideration.

Goods

Tangible things personal (anything not land or attached to land/ real goods).

Section 16

Implied Term of “Quiet Possession”.

Merchantable quality

Goods are in good condition, no defects & do what it’s supposed to do – can be sold to another party without a reduction in price.

The Sale of Goods Act (SGA)

Consumer protection legislation.

Barter

Goods exchanged for goods.

Section 19

The bulk goods must correspond with the sample.

Contract

One party CANNOT contract out of a liability for the ENTIRE bargain → __ law still applies.

Breach

Warranty claim damages.

Warranty to condition

Companies can convert a to at any time.

Risk

Whoever has the title of owner has the __.

Unascertained goods

Aren’t specific bc bulk, know SKU but not specific ones you’ll get.

Party

Unless you are a __ to a contract, you do not have rights under the contract

Privity

You must be a party to a contract to enforce it.

Tort Sidesteps Privity

Sue under negligence instead of breach of contract.

Indemnity

Gives one defendant is exposed to liability without any fault of their own.

STRICTLY EMPLOYEE EXEMPTION CLAUSE

Allows 3rd parties to rely upon an exemption clause.

Beneficiaries

Trusts will recognize __ where there is a trust in place.

Enurement clause

extends the rights and benefits to those inheriting from a party, succeeding the party, or taking and assignment from the party.

Tort

Tort = an unlawful act which causes injury or harm to another person or property.

Negligence

Careless harm or injury to persons or property.

Duty of care

The plaintiff must establish that a __ was owed to them by the defendant.

Reasonable

The __ care that would be taken by an ordinary person, taking into account the circumstances, to avoid causing foreseeable injury to persons or property.

Damage

There must be _ suffered by the plaintiff.

Vicarious

If a third party (including an employee) commits a tort such as negligence while vicariously performing under contract for the employer, the injured party may sue both the employer for __ liability and the employee personally in tort.

Contributory negligence

When the plaintiff’s own conduct or the conduct of another provides a partial or full defence.

Duty to mitigate

The plaintiff must act reasonably and quickly to minimize the extent of the damage suffered.

Voluntary assumption of risk

Walking down the street and saw a construction site (safely protected) and you stepped in and see someone operating a crane and then you get hurt.

Dangerous Products and the Duty to Warn

If something is inherently dangerous, manufacturers have a specific duty to give proper warning of the known dangers.

Occuiper’s Liability Act

Applies to invitees (persons permitted to enter for business purposes), and licensees (express or implied), and even trespassers.

Relied

Professional = someone with specialized knowledge and skills who are __ on by others.

Lawyer

A fundamental duty of a __ is to act in the best interest of his/her client to the exclusion of all other adverse interests, except those fully disclosed by the lawyer and willingly accepted by the client.

Apparent

Agents will have __ authority to enter into a contract unless the third party knows or ought to know of any restriction on that authority.

Principal

The __ can avoid being bound by contracts where the agent has apparent authority by informing third parties that all contracts require approval of the principal.

Ratification

Going back in time and giving them authority so they’re bound to the contract

Skill

The degree of __ required depends on the nature of the task and the apparent competence of the agent for that purpose.

Third

In a usual agency relationship, there are two distinct contracts: Agency agreement and __ party contract.

Express or implied

Agency agreement (contract) can be (oral or written) or (by commercial/understood usage of the agent’s position or duties).

Apparent Authority

Authority that a third party would reasonably believe someone has based on the conduct of the principal.

Must keep principal informed

To give notice to the principal.

Partnership

Relationship which subsists between persons carrying on business in common with a view to profit.

Sole proprietorship

As soon as an individual starts doing business, they have a __.

Sole Proprietorship

Income is reported as personal income.

Partnerships are

Consentual and contractual relationship.

Sharing of profits

Is essential or at least the intention to if business is unprofitable.

Property

The partners will have a personal interest in that __ (they each own a certain percentage according to their partnership interest).

Joint and several

Every partner has and liability for the debts and liabilities of the partnership.

Varied

The fiduciary duty of a partner may not be __.

Apparent Partners

On the hook for liability as a partner if you give off the appearance that you are one.

Limited Liability Partnerships

Requires a written agreement that designated the partnership as an LLP.

Corporate Veil

The __ is the separation of the corporation from management and shareholders.

Shareholders

A corporation is liable for its own debts – NOT __.

Management and supervision

The board is responsible for the and of the company (shareholders weigh in on only a minority of special instances).

Creatures of statute

Crown corporations are “__”

Articles of Incorporation set out

Name of company, HQ, Share capital, & Restrictions.

CBCA – Bylaws

Detailed operating rules for day-to-day affairs that require director approval.

Freely

Public = companies that issue shares directly to the public (and are __ transferable) and are reporting.

ONE

A company must have at least __ director if private.

Limited

Structure of corporation BUT no _ liability.

Directors

Manage or supervise the management of the business and affairs of the corporation.

Fiduciary duty of Directors and Officers

To act honestly and in good faith with a view to the best interests of the corporation.