blaw exam 2

1. contract: a legally enforceable agreement

2. noncompetition agreement: a contract in which one party agrees not to compete with another

3. bilateral contract: a promise made in exchange for another promise

4. elements of a contract: agreement, consideration, capacity, lawful object

5. unilateral contract: one party makes a promise that the other party can accept

only by actually doing something "a promise for an act"

6. executory contract: an agreement in which one or more parties has not yet

fulfilled its obligations or not fully performed

7. executed contract: an agreement in which all parties have fulfilled their obligations or fully performed

8. valid contract: satisfies all of the laws requirements and is therefore enforceable

in a court of law

9. unenforceable agreement: occurs when the parties intend to form a valid bargain, but don't

10. voidable contract: an agreement that may be terminated the election of one of

the parties

11. void agreement: a contract that either party can enforce, because the the

bargain is illegal or one of the parties had no legal authority to make it so no contract

at all

12. express contract: an agreement with all the important terms explicitly stated

13. implied contract: the words and conduct of the parties indicate that they intended an agreement

14. uniform commercial code (UCC): goods = movable personal property: anything moveable except, for money, securities, and certain legal rights

15. promissory estoppel: a possible remedy for an injured plaintiff in a case with

no vaild contract, when the plaintiff can show a promise, reasonable reliance, and

injustice

16. 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

17. quantam meruit: "as much as he deserves" - the damages awarded in a

quasi-contract case

18. offer: an act or statement that proposes definite terms and permits the other

party to create a contract by accepting those terms

19. offeror: person who makes an offer

20. offeree: person to whom an offer is made

21. gap-filler provisions: UCC rules for supplying missing terms

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22. output contract: obligates the seller to sell all of his output to the buyer, who

agrees to accept it

23. requirements contract: obligates a buyer to obtain all of his needed goods from

the seller

24. counteroffer: a different proposal made in response to an original offer and a

new offer from the offeree back to the offeror

25. consumer protection statue: laws protecting consumers from fraud

26. letter of intent: a letter that summarizes negotiating progress

27. mirror image rule: requires that acceptance be on precisely the same terms as

the offer

28. mailbox rule: acceptance is generally effective upon dispatch. terminations are

effective when received

29. consideration: the inducement, price, or promise that causes a person to enter

in a contract and forms the basis for the parties exchange

30. act: any action that a party was not legally required to take in the first place

31. for bearance: refraining from doing something that one has a legal right to do

32. bargained for exchange: the promise must induce the detriment and the detriment must induce the promise

33. liquidated debt: a debt in which there is no dispute about the amount owed

34. unliquidated: a debt that is disputed because the parties disagree over its

existence or amount

35. rescind: to cancel

36. accord and satisfaction: a completed agreement to settle a debt for less than

the sum claimed

37. exculpatory clause: a clause provision that attempts to release one party from

liability in the event the other is injured

38. bailee: a person who rightfully possesses goods and belongings to another

(temporary possession)

39. bailment: giving possession and control of personal property to another person

40. bailor: one who creates a bailment by delivering goods to another

41. procedural unconscionability: one party uses its superior power to force a

contract on the weaker party

42. substantive unconscionability: a contract with extremely one-sided and unfair

terms

43. adhesion contract: standard form contract prepared by one party and presented to the other on a "take it or leave it" basis

44. voidable: when a contract is __, the injured party may choose to terminate it

45. disaffirm: to give notice of refusal to be bound by an agreement

46. restitution: restoring an injured party to its original position

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47. ratification: words or actions indicating an intention to be bound by a contract

48. duress: an improper threat made to force another party to enter a contract

49. unilateral mistake: occurs when only one party enters a contract under a

mistaken assumption

50. discharged: a party is discharged when she has no more duties under the

contract

51. strict performance: requires one party to perform its obligations precisely, with

no deviation from the contract terms

52. substantially performs: occurs when one party fulfills enough of its contract

obligations to warrant payment

53. personal satisfaction contract: permits the promisee to make subjective evaluations of the promisors performance

54. time of the essence clause: generally make contract dates strictly enforceable

55. statute of limitations: a statutory time limit within which an injured party must

file suit

56. buyer in the ordinary course of business (BIOC): one who acts in good faith,

without knowing that the sale violates the owners rights

57. voidable title: limited rights in goods, inferior to those of the owner

58. warranty: a contractual assurance that goods will meet certain standards

59. nonconforming goods: merchandise that differs from what is specified in the

contract

60. express warranty: one that seller creates with his words or actions

61. merchantable: the goods are fit for the ordinary purpose for which they are used

62. disclaimer: a statement that a particular warranty doesn't apply

63. limitation of remedy clause: contract clause allowing parties to limit or exclude

applicable UCC remedies

64. consequential damages: contract damages resulting as an indirect consequence of the breach

65. value: legal benefit means receiving/foregoing something of measurable value

66. bargained for: when something is sought by the promisor and given by the

promissee in exchange for their promises

67. illusory promisees: an illusory promise is not consideration (not a binding

promise)

68. preexisting duty: if someone provides a service that she is already obligated

to do, that act does not count as consideration

69. capacity: the legal ability of a party to enter into a contract

70. consent: refers to whether a contracting party truly understood the agreement

71. disaffirmance: a minor who which to escape from a contract may disaffirm it

INTEREST AND TITLE An interest is a legal right in something. Title means the normal rights of ownership.

IDENTIFICATION Goods must exist and be identified to the contract before title can pass. The parties may agree in their contract how and when they will identify goods; if they do not specify, the Code stipulates when it happens. The parties may also state when title passes, and once again, if they do not, the Code provides rules.

3.

INSURABLE INTEREST A buyer obtains an insurable interest when the goods are identified to the contract. A seller retains an insurable interest in goods as long as she has either title or a security interest in them.

4.

VOID AND VOIDABLE TITLE Void title is no title at all. Voidable title means limited rights in the goods, inferior to those of the owner. A person with voidable title has power to transfer good title to a bona fide purchaser (BFP); that is, someone who purchases in good faith, for value.

5.

ENTRUSTING Any entrusting of goods to a merchant who deals in goods of that kind gives him the power to transfer all rights of the entruster to a buyer in the ordinary course of business.

6.

BIOC A buyer in the ordinary course of business generally takes goods free and clear of any security interest.

7.

RISK OF LOSS In their contract, the parties may allocate the risk of loss any way they wish. If they fail to do so, the Code provides several steps to determine who pays for any damage. When neither party has breached, the risk of loss generally passes from seller to buyer when the seller has transported the goods as far as he is obligated to. When a party has breached, the risk of loss generally lies with the party that has breached.

8.

EXPRESS WARRANTY Seller can create an express warranty with any affirmation description of the goods, or sample or model, provided the promise part of the basis of the bargain.

9.

IMPLIED WARRANTY OF MERCHANTABILITY With certain exceptions, the Code implies a warranty that the goods will be fit for their ordinary purpose.

10.

IMPLIED WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE With some exceptions, the Code implies a warranty that the goods are fit for the buyer’s special purpose, provided that the seller knows of that purpose when the contract is made and knows of the buyer’s reliance.