Business Law Tst 3

Question 1

Contract

Answer 1

Legally enforceable agreement

Question 2

4 parts of a contract

Answer 2

Agreement
Consideration
Capacity
Legality

Question 3

Elements of offer and acceptance

Answer 3

Intent
Definite and certain terms
Communication

Question 4

Unilateral Mistake

Answer 4

Doesn’t void contract

Mistake by one side

Question 5

Mutual Mistake

Answer 5

Mistake by both sides on material fact of case.

Question 6

Misrepresentation of law

Answer 6

Untruthful assertions by one of the parties about a material fact

Question 7

Undue influence

Answer 7

Person in power takes advantage of one a relationship they have with another person (Dr. convincing patient to get surgery they don’t need.

Question 8

Duress

Answer 8

Party is under pressure to accept deal. Gun to head

Question 9

Promissory Estoppel

Answer 9

Party makes promise knowing the other party will rely on it.
Other party relies on promise
Promise is enforced to avoid injustice

Question 10

Partial payment of debt

Answer 10

Depends on whether debt is liquidated or unliquidated. Partial payment of liquidated debt is not sufficient consideration for discharge. However partial payment of a unliquidated amount maybe.

Question 11

Bilateral Contract

Answer 11

Promise for Promise

Question 12

Unilateral contract

Answer 12

Promise for performance

Question 13

Capacity

Answer 13

Legal ability to enter into contract. Individual is deemed to have mental ability to understand rights and obligations under contract.

(Minors and mentally incompetent)

Question 14

Parental liability

Answer 14

Parents are not generally liable for children’s contracts. Maybe held liable for children’s actions under tort law.

Question 15

Legality

Answer 15

Contract must be able to be oerfirmed legally. Otherwise it is void.

Question 16

Usury contracts

Answer 16

Not enforceable and can lead to forfeiture of interest and principle
(In Texas 18%, 6% if not written)

Question 17

Unconscionable contracts

Answer 17

Shockingly unfair contracts

(Substantive= substance of contract is unfair.)

(Procedural= way contract was put together is unfair)

Question 18

Sources of law

Answer 18

UCC

Common Law

Question 19

Implied contracts

Answer 19

Quantum Meruit

Sum of money to be payed for work done when amount due is not legally stipulated.

Question 20

Quasai contracts

Answer 20

Unjust enrichment

Obligation of one party to another imposed by law independently of an agreement between parties.
(One party takes advantage of another)

Question 21

Statute of frauds

Answer 21

Requires contract to be in writing.

Land, marriage, anything that can’t be performed within one year.

Question 22

Parol evidence rule

Answer 22

Prohibits use of oral or written testimony unless there is ambiguity in the contract.

Question 23

Third party beneficiary

Answer 23

2 parties benefit another independent party

Question 24

Discharge

Answer 24

Terminate or end a contract

Question 25

Difference in material and immaterial breach

Answer 25

Mat.= one party doesn’t do an important part of the contract (won’t pay) this can void contract Immaterial.= one party doesn’t do minor part (pay late) contract can still be performed. Party who didn’t breech can sue for damages

Question 26

Damages

Answer 26

Compensatory for economic loss Benefit of bargain Out of packet damages

Question 27

Specific performance

Answer 27

One trick pony. Breach of contract for something that is one of a kind