legal aspects of management - terms quiz ch 3

implied contract

A contract formed in whole or in part from the conduct of the parties (as opposed to an express contract).

quasi contracts

A fictional contract imposed on parties by a court in the interests of fairness and justice; usually, quasi contracts are imposed to avoid the unjust enrichment of one party at the expense of another.

revocation

In contract law, the withdrawal of an offer by an offeror. Unless an offer is irrevocable, it can be revoked at any time prior to acceptance without liability.

mirror image rule

A common law rule that requires, for a valid contractual agreement, that the terms of the offeree’s acceptance adhere exactly to the terms of the offeror’s offer.

accord & satisfaction

An agreement for payment (or other performance) between two parties, one of whom has a right of action against the other. After the payment has been accepted or other performance has been made, it is complete, and the obligation is discharged.

liquidated debt

A debt that is due and certain in amount.

recission

A remedy whereby a contract is canceled and the parties are returned to the positions they occupied before the contract was made; may be effected through the mutual consent of the parties, by their conduct, or by court decree.

estopped

Barred, impeded, or precluded.

disaffirmance

The legal avoidance, or setting aside, of a contractual obligation.

exculpatory clause

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

negligent misrepresentation

Any manifestation through words or conduct that amounts to an untrue statement of fact made in circumstances in which a reasonable and prudent person would not have done that which led to the misrepresentation. A representation made with an honest belief in its truth may still be negligent due to (1) a lack of reasonable care in ascertaining the facts, (2) the manner of expression, or (3) the absence of the skill or competence required by a particular business or profession.

duress

Unlawful pressure brought to bear on a person, causing the person to perform an act that he or she would not otherwise perform (or refrain from doing something that he or she would otherwise do).

undue influence

Persuasion that is less than actual force but more than advice and that induces a person to act according to the will or purposes of the dominating party.

parol evidence rule

A substantive rule of contracts under which a court will not receive into evidence the parties’ prior negotiations, prior agreements, or contemporaneous oral agreements if that evidence contradicts or varies the terms of the parties’ written contract.

statute of frauds

A state statute under which certain types of contracts must be in writing to be enforceable.

assignment

The act of transferring to another all or part of one’s rights arising under a contract.

intended beneficiary

A third party for whose benefit a contract is formed; can sue the promisor if such a contract is breached.

third party beneficiary

One for whose benefit a promise is made in a contract but who is not a party to the contract.

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.

condition precedent

A condition in a contract that must be met before a party’s promise becomes absolute.

breach of contract

The failure, without legal excuse, of a promisor to perform the obligations of a contract.

consequential damages

Special damages that compensate for a loss that is not direct or immediate (for example, lost profits). The special damages must have been reasonably foreseeable at the time the breach or injury occurred in order for the plaintiff to collect them.

incidental damages

Damages that compensate for expenses directly incurred because of a breach of contract, such as those incurred to obtain performance from another source.

specific performance

An equitable remedy requiring the breaching party to perform as promised under the contract; usually granted only when money damages would be an inadequate remedy and the subject matter of the contract is unique (for example, real property).

mitigation of damages

A rule requiring a plaintiff to have done whatever was reasonable to minimize the damages caused by the defendant.