chap 10

Question 1

Elements of Contract

Answer 1

Agreement, Consideration, Contractual Capacity, and Legality

Question 2

Agreement

Answer 2

Agreement to form contract must include offer and acceptance. Mirror acceptance

Question 3

Consideration

Answer 3

Promises made by parties must involve something of legal significant value such as money

Question 4

Contractual Capacity

Answer 4

Both parties must be legally able to be enter into contract (Minors, Intoxicated persons, and mentally disabled persons)`

Question 5

Legality

Answer 5

Goal of contract must be legal

Question 6

Reasonable Person Test

Answer 6

Would a reasonable person think that a contract is being made by the circumstances

Question 7

Bilateral Contract

Answer 7

Promise given in exchange for return promise

Question 8

Unilateral Contract

Answer 8

Offer can be accepted only by offeree’s performance

Question 9

Formal Contract

Answer 9

Agreement that by law requires a specific form to be valid

Question 10

Informal or Simple contract

Answer 10

Does not require a specific form to be valid

Question 11

Express Contract

Answer 11

Terms of agreement are stated in words, oral or written

Question 12

Implied Contract

Answer 12

Formed in whole or in part from the conduct of the parties

Question 13

Executed Contract

Answer 13

Contract that has been fully performed on both sides

Question 14

Executory contract

Answer 14

A contract that has not yet been fully performed

Question 15

Voidable Contract

Answer 15

Contract that can be legally avoided at the option of one or both of the parties

Question 16

Unenforceable contracts

Answer 16

A valid contract rendered unenforceable by some statute or law

Question 17

Void Contracts

Answer 17

Contract that has no legal force or binding effect

Question 18

Elements needed for offer

Answer 18

1. serious objective intention by the offerer, 2. terms of offer must be reasonably certain or definite, 3. offer must be communicated to the offeree

Question 19

Intention (Requirements of an offer)

Answer 19

determined by whether or not a reasonable person in the offeree’s position would conclude that the offeror’s words and actions meant

Question 20

Lacking intention

Answer 20

1. Expressions of opinion
2. Statements of future intent
3. Preliminary negotiations
4. Invitations to bid
5. Advertisements and price lists
6. Live and online auctions

Question 21

Definiteness of term Requirements of offer

Answer 21

1. identification of parties
2. identification of the object or subject matter of contract
3. the consideration to be paid
4. the time of payment, delivery, or performance

Question 22

Objective Theory of contracts

Answer 22

party’s intention to enter into a contract is judged by outward, objective facts as interpreted by a reasonable person, rather than by the party’s secret, subjective intentions

Question 23

Rejection

Answer 23

Effective only when it is actually received by the offeror or the offeror’s agent

Question 24

Counter Offer

Answer 24

A rejection of the original offer and the simultaneous making of a new offer

Question 25

Irrevocable Offers

Answer 25

Some offers can be made irrevocable Courts refuse to allow an offeror to revoke an offer when the offeree has changed position because of justifiable reliance on the offer

Question 26

Option Contract

Answer 26

A contract under which the offeror cannot revoke the offer for a stipulated time period

Question 27

Usury

Answer 27

Charging an illegal Interest rate

Question 28

Mirror Image rule

Answer 28

Acceptance of offer must be an exact reflection of the offer in other words the offeror and the offeree must be on the same page and agreeing to the same terms

Question 29

Mailbox rule

Answer 29

Acceptance is valid when it is dispatched through the mail 1. Authorized methods of delivery are valid once they are submitted even if not yet received by other party 2. Substitute methods of acceptance are valid only after received by the offeror

Question 30

Browse wrap Agreement

Answer 30

Terms or conditions of use presented when an online buyer downloads a product but does not require the buyer's explicit agreement

Question 31

Shrink Wrap agreement

Answer 31

An agreement whose terms are expressed in a document located inside a box of goods / package

Question 32

Click-on agreements

Answer 32

Arises when an online buyer clicks on the "I agree" button or otherwise assents to be bound by the terms of the offer

Question 33

Uniform Electronic Transactions Act

Answer 33

Helped to remove barriers to ecommerce was made mainly with the intention of making e-contracts more accessible and prevalent

Question 34

Legal Capacity for contracts (Minors)

Answer 34

Can enter into any contract as long as the contract is legal. However it is voidable at the option of that minor, subject to exceptions such as when purchasing necessities

Question 35

Disaffirmance

Answer 35

Legal avoidance or setting aside of a contractual obligation - minors can use this to put off paying something off until they are of legal age

Question 36

Intoxication or disabled

Answer 36

Can be voidable or valid depending on evidence pertaining to the persons condition at the time of agreement

Question 37

Unconscionable agreements

Answer 37

A contract or clause that is void on the basis of public policy because one part was forced to accept terms that are unfairly burdensome and that unfairly benefit the stronger party

Question 38

Elements of Consideration

Answer 38

1. promise to do something that one has no prior legal duty to do 2. the performance of an action that one is not otherwise obligated to undertake 3. refraining from an action that one has a legal right to undertake (a forbearance)