blaw exam 2

contract

a legally enforceable agreement

noncompetition agreement

a contract in which one party agrees not to compete with another

bilateral contract

a promise made in exchange for another promise

elements of a contract

agreement, consideration, capacity, lawful object

unilateral contract

one party makes a promise that the other party can accept only by actually doing something, 'a promise for an act'

executory contract

an agreement in which one or more parties has not yet fulfilled its obligations or not fully performed

executed contract

an agreement in which all parties have fulfilled their obligations or fully performed

valid contract

satisfies all of the laws requirements and is therefore enforceable in a court of law

unenforceable agreement

occurs when the parties intend to form a valid bargain, but don't

voidable contract

an agreement that may be terminated at the election of one of the parties

void agreement

a contract that either party can enforce, because the bargain is illegal or one of the parties had no legal authority to make it, so no contract at all

express contract

an agreement with all the important terms explicitly stated

implied contract

the words and conduct of the parties indicate that they intended an agreement

uniform commercial code (UCC)

goods = movable personal property: anything moveable except for money, securities, and certain legal rights

promissory estoppel

a possible remedy for an injured plaintiff in a case with no valid contract, when the plaintiff can show a promise, reasonable reliance, and injustice

quasi-contract

a possible remedy for an injured plaintiff in a case with no valid contract when the plaintiff can show benefit to the defendant, reasonable expectation of payment, and unjust enrichment

quantam meruit

'as much as he deserves' - the damages awarded in a quasi-contract case

offer

an act or statement that proposes definite terms and permits the other party to create a contract by accepting those terms

offeror

person who makes an offer

offeree

person to whom an offer is made

gap-filler provisions

UCC rules for supplying missing terms

output contract

obligates the seller to sell all of his output to the buyer, who agrees to accept it

requirements contract

obligates a buyer to obtain all of his needed goods from the seller

counteroffer

a different proposal made in response to an original offer and a new offer from the offeree back to the offeror

consumer protection statute

laws protecting consumers from fraud

letter of intent

a letter that summarizes negotiating progress

mirror image rule

requires that acceptance be on precisely the same terms as the offer

mailbox rule

acceptance is generally effective upon dispatch; terminations are effective when received

consideration

the inducement, price, or promise that causes a person to enter into a contract and forms the basis for the parties' exchange

act

any action that a party was not legally required to take in the first place

forbearance

refraining from doing something that one has a legal right to do

bargained for exchange

the promise must induce the detriment and the detriment must induce the promise

liquidated debt

a debt in which there is no dispute about the amount owed

unliquidated

a debt that is disputed because the parties disagree over its existence or amount

rescind

to cancel

accord and satisfaction

a completed agreement to settle a debt for less than the sum claimed

exculpatory clause

a clause provision that attempts to release one party from liability in the event the other is injured

bailee

a person who rightfully possesses goods and belongings to another (temporary possession)

bailment

giving possession and control of personal property to another person

bailor

one who creates a bailment by delivering goods to another

procedural unconscionability

one party uses its superior power to force a contract on the weaker party

substantive unconscionability

a contract with extremely one-sided and unfair terms

adhesion contract

standard form contract prepared by one party and presented to the other on a 'take it or leave it' basis

voidable

when a contract is voidable, the injured party may choose to terminate it

disaffirm

to give notice of refusal to be bound by an agreement

restitution

restoring an injured party to its original position

ratification

words or actions indicating an intention to be bound by a contract

duress

an improper threat made to force another party to enter a contract

unilateral mistake

occurs when only one party enters a contract under a mistaken assumption

discharged

a party is discharged when she has no more duties under the contract

strict performance

requires one party to perform its obligations precisely, with no deviation from the contract terms

substantially performs

occurs when one party fulfills enough of its contract obligations to warrant payment

personal satisfaction contract

permits the promisee to make subjective evaluations of the promisor's performance

time of the essence clause

generally makes contract dates strictly enforceable

statute of limitations

a statutory time limit within which an injured party must file suit

buyer in the ordinary course of business (BIOC)

one who acts in good faith, without knowing that the sale violates the owner's rights

voidable title

limited rights in goods, inferior to those of the owner

warranty

a contractual assurance that goods will meet certain standards

nonconforming goods

merchandise that differs from what is specified in the contract

express warranty

one that the seller creates with his words or actions

merchantable

the goods are fit for the ordinary purpose for which they are used

disclaimer

a statement that a particular warranty doesn't apply

limitation of remedy clause

contract clause allowing parties to limit or exclude applicable UCC remedies

consequential damages

contract damages resulting as an indirect consequence of the breach

value

legal benefit means receiving/foregoing something of measurable value

bargained for

when something is sought by the promisor and given by the promissee in exchange for their promises

illusory promise

an illusory promise is not consideration (not a binding promise)

preexisting duty

if someone provides a service that she is already obligated to do, that act does not count as consideration

capacity

the legal ability of a party to enter into a contract

consent

refers to whether a contracting party truly understood the agreement

disaffirmance

a minor who wishes to escape from a contract may disaffirm it