business law exam 2

void contact

lacks one or more legal elements that make it valid, cannot be enforced by either party

voidable contracts

can be enforced by 1 party but not the other

unenforceable contracts

cannot be enforecd due to legal reasons, certain rights may still exist

expressed contact

in writing or spoken

implied contract

conduct or circumstance forming an agreement

illegal contracts

no remedy, void, if only certain parts of contract are illegal it can be rewritten

bilateral contracts

both parties make a promise to each other

unilateral contracts

1 promise made, offer is accepted by performing

unconscionable

shock the conscious of the court so bad that they have to intervene; unfair or one-sided

executed contract

contract that has been fully performed

executory contract

one that has not been fully performed

consideration

both parties must provide value

capacity

legal ability for a person to enter a contract

revocation of offer

before offer is accepted, can happen if one party takes to long to decide

termination of offer

lapse of time, death, counter-offer

option contract

right, but not obligation, to buy or sell

divisible contract

broken into smaller part of contract

quasi contract

not real contracts but obligations

promissory estoppel

reasonably relied on a promise to your detriment

conditions

conditions specify requirements that parties must meet for contractual obligations to take effect

accord and satisfaction

settle a debt or obligation through acceptance of substitute performance or different form of payment

unilateral mistake

one party holds a incorrect belief of a fundamental fact

bilateral/mutual mistake

both parties are mistaken about the same material fact, could potentially lead to contact being voidable

fraud

lying to make someone go into a transaction to make some go into something on terms that aren't true

elements

offer, acceptance, consideration, capacity, and legality

scienter

defendants knowledge that an act or conduct is wrong and intent to act despite this knowledge

undue influence

when one party unfairly dominates the other

duress

Something that forces the other party into a contract; threats, blackmail, Lacks voluntary consent

business sale

transfers assets and ownership in a company, along with liabilities

pledge

conveys title property owned by a debtor (pledgor) to a creditor (pledgee) to secure repayments for some debt or obligation and to the mutual benefit of both parties

advertisment

invitation to negotiate, not offers to enter a contract

privity of contract

people who are included in the contract

assignment

one party transferring the right to benefits under a contract to another party; original duties or obligations remain with the assignor unless delegated

delegation

a party (the delegator) transferring their contractual duties to another party (the delegatee), while the delegator remains liable unless the other party to the original contract agrees to release them

subrogation

where one party assumes the legal rights of another

third party beneficiary

Not in contract but have an interest in it; Gets something from the contract

intended beneficiary

has the standing to sue against the contract

incidental beneficiary

benefits from a contract but has no legal rights to enforce it

novation

an agreement made between two contracting parties to allow for the substitution of a new party for an existing one

statute of frauds

certain contracts have to be in writing; cannot be completed before the year, real estate

liquidated damages

ensuring you are compensated should a party you hire fail to do their job

compensatory damages

the difference between what was agreed to and what happened

consequential damages

special damages, damages that can be proven to have occurred because of the failure of one party to meet a contractual obligation, a breach of contract

mitigation of damages

requires the non-breaching party to take reasonable steps to minimize their losses resulting from a breach, preventing them from recovering damages that could have been avoided

full performance

a situation where the parties have fulfilled all of their duties under a contract

substantial performance

a party has fulfilled the core obligations of a contract, even if there are minor deviations or imperfections, allowing them to avoid a claim for breach of contract

material breach

significant failure to perform a key obligation, fundamentally undermining the contract's purpose and allowing the non-breaching party to seek remedies like termination or damages

equitable remedies

rescission: Party seeking rescission must show that the contracting parties can be restored to the status quo. Restitution: requiring a defendant to return a benefit they received at the expense of another. Specific performance: a court order compelling a party to fulfill their contractual obligations (unique or irreplaceable)

penatly

a contractual clause that imposes liquidated damages that are unreasonably high and represent a punishment for breach, rather than a reasonable forecast of damages for the harm that is caused by the breach, are referred to as penalty clauses

repudiation

where one party of a contract clearly states or demonstrates their intention not to fulfill their contractual obligations

commerical code

same set of rules in every state

sale of goods

an agreement between a buyer and a seller, outlining the sale and purchase of goods

merchants

a person who regularly deals in goods of the kind involved in the transaction, or who holds themselves out as having knowledge or skill peculiar to the practices or goods involved

firm offer

an irrevocable offer to contract under Article 2 of the Uniform Commercial Code In a sale of goods

special standards

specific terms or requirements in a contract that apply to unique circumstances or situations

quantity term

refers to the specific amount or number of goods or services that are the subject of a contract, and it's a crucial element for a contract to be enforceable, especially under the Uniform Commercial Codef

promise to ship

refers to a sellers acceptance of an offer to buy goods for prompt or current shipment, which can be done either by promising to ship or by actually shipping the goods

output contract

legally binding agreement where a buyer commits to purchasing a seller's entire production of a specific product or service, ensuring a guaranteed market for the seller

warranty

assurances or promises regarding the quality, nature, or condition of a good or service

express warranties

specific promises or affirmations made by the seller about good, forming a a part of the basis of the bargain

implied warranties

arise automatically from the nature of the transaction and the law

warranty title

implied warranty that the seller has the right to sell the goods and that the buyer will receive a clean title

breach of warranty

the seller fails to provide the assurance warranted, either expressed or implied