mgmt final (ch 12)

mgmt final (ch 12)

accord and satisfaction

a legal way for people to settle a disagreement about money or a contract by making a new, different agreement (once accepted or payment is made, accord and satisfaction is complete)

assignment

giving your rights or benefits from a contract to someone else

bilateral contract

a simple agreement where two people promise to do something for each other

delegation

when a person transfers (some of) their responsibilities in their contractual duty to another person they trust

disaffirmance

the legal avoidance, or setting aside, of a contractual obligation

estopped

barred/impeded/stopped from going back on their word or changing their mind if someone else has already relied on what they said or did

exculpatory clause

releases a contractual party from liability in the event of monetary or physical injury, no matter who is at fault

executory contract

a contract that has not yet been fully performed

express contract

a contract in which the terms of the agreement are fully and explicitly stated in words, oral or written

forbearance

1) refraining from exercising a legal right

2) agreement between lender and borrower (lender agrees to temporarily cease requiring mortgage payments, to delay foreclosure, or to accept smaller payments than previously scheduled)

implied contract

a contract formed without actually saying the words out loud (understood based on the parties’ actions or the situation, not by writing it down or speaking it directly)

intended beneficiary

a third party for whose benefit a contract is formed

liquidated debt

a debt that is due and everyone agrees on exactly how much money is owed

mailbox rule

an offer's acceptance is effective the moment the offeree sends it, not when the offeror receives it, forming a binding contract even if the offeror gets it later

option contract

a legal agreement in which the seller agrees to keep an offer open for a specified period of time in exchange for payment

privity of contract

the rule that a contract is a private deal between the people who agree to it, and only the people who made the contract get the benefits or responsibilities from that agreement

promissory estoppel

a rule that stops someone from breaking their promise if another person relied on that promise and would be hurt if the promise were broken

reformation

a court-ordered correction of a written contract so that it reflects the true intentions of the parties

release

a contract in which one party forfeits the right to pursue a legal claim against the other party

rescission

to cancel a deal or agreement completely, as if it never happened in the first place

statute of frauds

certain types of contracts must be in writing to be enforceable

third-party beneficiary

a person who is not part of a contract but is intended to benefit from its terms

unconscionable

a contract that is void on the basis of public policy because one party is forced to accept terms that are unfairly burdensome and that unfairly benefit the dominating party

unilateral contract

one person offers to pay or reward someone else for doing a specific action, and the contract is formed only when that action is completed

unliquidated debt

a debt that is uncertain in amount

usury

charging an illegal rate of interest

voidable contract

a contract that may be legally cancelled at the option of one of the parties

TEST QUESTION: anticipatory repudiation

• an assertion or action by a party indicating that he or she will not perform an obligation that he or she is contractually obligated to perform at a future time

• a legal way of saying, "I'm breaking my promise before I'm even supposed to keep it!" 

TEST QUESTION: discharge by novation

a legal way to end an old agreement by replacing it with a brand new one

TEST QUESTION: commercial impracticability vs frustration of purpose

• Commercial Impracticability

  • Focus: The difficulty or burden of performing the contractual duties.

  • Performance: Performance is still technically possible but has become extremely unreasonable, difficult, expensive, or damaging due to an unforeseen event.

• Frustration of Purpose

  • Focus: The fundamental reason or value of the contract to one or both parties.

  • Performance: Performance might still be physically possible, but the value of what a party was supposed to receive has been totally or nearly destroyed by an unforeseen event, rendering the contract meaningless.

TEST QUESTION: is electricity a good or a service?

Some courts say it’s a good, some courts say it’s a service (answer is NOT it depends)

TEST QUESTION: unconscionability (substantive)

a contract is so unfair that it makes a judge say "that's just not right!"

TEST QUESTION: whistleblower laws

rules that protect people who speak up about bad or illegal things happening at their workplace