Chp 5 Contracts

Question 1

contract

Answer 1

is a special kind of agreement, either written or oral, that involves legally binding obligations between two or more parties

Question 2

Express Contract

Answer 2

is one in which the parties have an oral or written agreement, equally legal and binding

Question 3

implied contract

Answer 3

is one that is inferred by law, based on the conduct of the parties such as a handshake or similar conduct.

Question 4

voidable contact

Answer 4

is one in which one party, but not he other has the right to escape from its legal obligations under the contracts

Question 5

elements of contract

Answer 5

the law will enforce contracts only when they are executed between persons who are competent; that is, those with the legal and mental capacity to contract

Question 6

offer

Answer 6

is a promise by one party to do (or not to do) something if the other party agrees to ( or not do) something

an offer must be communicated to the other party so that it can be accepted or rejected

Question 7

consideration

Answer 7

requires that each party to a contract give up something of value in exchange for something of value

Question 8

breach of contract

Answer 8

occurs when there is a violation of one or more of the terms of the contracts

Question 9

partnership

Answer 9

comprises two or more persons who agree to carry on a business for profit and to share profits and losses in some proportions, can be created by the parties actions without a written or oral agreement

Question 10

agent

Answer 10

is one who has the power to contract for and bind another person, who is known as the principal.

corporations can act only through agents (their officers)

Question 11

apparent or ostensible agent

Answer 11

is one who a third person believes is acting on behalf of the principal.

Question 12

independent contractor

Answer 12

is an individual who agrees to undertake work without being under the direct control or direction of another

-personally responsible for their own negligent acts

Question 13

condition precedent

Answer 13

is an act or event that must happen or be performed by one party before the other party has any responsibility to perform under the contract

• express condition is formally written into the contract in specific terms
• implied condition is one in which although the parties might not have specifically mentioned the condition, it can reasonably be assumed that the parties intended the condition to be enforced

Question 14

performance

Answer 14

is the act of doing what is required by a contract, each party is bound to perform the promises according to the stipulated terms of a contract.

Question 15

defenses permitting nonperformance of contract

Answer 15

fraud, mistakes, duress, illegal contract, impossibility, and statute of limitation

Question 16

fraud

Answer 16

intentionally misrepresents a material fact or term of the contract and intends that the other party rely on that misrepresentation.
–victim of fraud does not perform under a contract

Question 17

mistake of fact

Answer 17

is an incorrect belief regarding a fact, both parties must make the mistake

Question 18

mistake of law

Answer 18

is an incorrect judgement of the legal consequences of known facts.

Question 19

duress

Answer 19

is the use of unlawful threats or pressure to force an individual to act against his or her will, an act performed under duress is not legally binding

Question 20

illegal contract

Answer 20

is a contract who formation, object, or performance is against the law or contrary to public policy that no court would upload or enforce.

Question 21

impossibility

Answer 21

1. certain facts might have existed at the time the contract was executed or
2. they might have arisen subsequent to the formation of the contract
   - -contracts that are impossible to perform do not have to be carried out by the parties to a contract

Question 22

statute of limitations

Answer 22

period of time that a party to take action to enforce contract rights by suing for damages caused by a breach of the contract or taking other action can be barred from doing so.

Question 23

general damages

Answer 23

are those that can be expected to arise from a breach of a contract

Question 24

consequential damages

Answer 24

are those that occur because of some unexpected, unusual, or strange development involved in the particular contract in dispute

Question 25

employment contract

Answer 25

is an agreement between an employee and employer that specifies the terms of employment - -conditions of employment includes wages, hours and type of work are part of employment contract - -an employer's right to terminate an employee can be limited by express agreement with the employee or through a collective bargaining agreement to which the employee is a beneficiary

Question 26

preliminary negotiation

Answer 26

are not offers

Question 27

Acceptance

Answer 27

* meeting of the minds- mutual assent, parties must understand and agree on the terms * definite and complete * duration- offeror( the one who makes the offer) may revoke an offer at any time prior to a valid acceptance, the revocation is not effective until the offeree ( the person to whom the offer is made) receives it. * complete and conforming- the acceptance must comply with all the terms of the offer and not change or add any terms

Question 28

basic elements of breach of contract

Answer 28

1. a valid contract was executed 2. the plaintiff performed as specified in the contract 3. the defendant failed to perform as specified in the contract 4. the plaintiff suffered an economic loss as a result of the defendant's breach of contract

Question 29

charter

Answer 29

the ability of a corporation to enter into contract is limited by its powers as contained in or inferred from its articles of incorporation or conferred upon it by general corporation law

Question 30

valid contract

Answer 30

the purpose or object of the contract must not be against state or federal policy and must not violate any statute, rule or regulation.

Question 31

Monetary damages

Answer 31

money damages ( compensatory damages) are rewarded in an attempt to restore to the aggrieved party the money that it would have had if the other party had not breached the contract

Question 32

restrictive convenant

Answer 32

is an employment contract between a hospital and physician

Question 33

employee handbook to constitute a contract

Answer 33

elements that must be presented are 1. a policy statement that clearly sets forth a promise that the employee can construe to be an offer 2. the policy statement must be distributed to the employee, making employee aware to the offer 3. after learning about the offer and policy statement, the employee must "begin" or "continue" to work

Question 34

exclusive contracts

Answer 34

an organization enters into an exclusive contract with physicians or medical groups for the purpose of providing a specific service to the organization

Question 35

transfer agreement

Answer 35

is a written document that sets forth the terms and conditions under which a patient can be transferred to a facility that more appropriately provides the kind of care required by the patient, it establishes procedures to admit patients of one facility to another when their condition warrants a transfer

Question 36

elements of transfer agreement

Answer 36

*identification of each party to the agreement including the name and location of each organization to the agreement *purpose of the agreement; policies and procedures for the transfer of patient * organizational responsibilities for arranging and making the transfer *exchange of information, interchange of medical and other information relevant to the patient * retention of autonomy, governing bodies of facility will continue to exercise exclusive legal responsibility *procedure for setting disputes * procedure for modification or termination of the agreement *sharing of service *publicity, that neither organization will use the name of the other in promotional or advertising material without prior consent *exclusive versus nonexclusive agreement, either party right to enter into transfer agreement with other organization *

Question 37

insurance

Answer 37

is a form of risk management used primarily to hedge against the risk of potential loss

Question 38

insurance contract

Answer 38

the insurer has an obligation to indemnify the insured for losses caused by specified events, in return the insured must pay a fixed premium during the policy period