Module 4 Flashcards
(26 cards)
What is the role of contracts in business?
[Contracts] are essential in business for creating [enforceable agreements] and managing [risk], [disputes], and legal obligations.
When should a contract be used?
To manage [risk], control obligations, and clarify terms—especially in [employment], [business], and [consumer] settings.
Are verbal contracts valid?
Yes, but they are harder to [prove] than written contracts.
How are online contracts formed?
Through [‘I Accept’] clickwrap agreements, subject to the [offeror’s location laws].
What techniques manage contract risk?
[Exemption clauses], [NDAs], [arbitration clauses], and [consent forms] limit liability.
What are dispute resolution methods?
[Negotiation], [mediation], [arbitration], or [court]. Include [dispute clauses] in contracts.
What are common contract remedies?
[Void/voidable], [rectification], [rescission], [damages]
How are international contracts handled?
Specify [jurisdiction], [laws], and [dispute process] up front.
What are examples of contract types?
[Verbal/written], [employment], [rental], [NDAs], [consumer], [commercial] agreements.
What is an implied contract?
A contract not written but enforced due to actions/relationship. Law may [imply terms], especially for [consumers].
What are the requirements for contract formation?
[Consensus], [consideration], [capacity], [intention], [legality], and sometimes [writing].
Why use plain language in contracts?
To ensure all parties understand their [obligations] and avoid [disputes].
What is consensus?
[Agreement] on essential terms through [offer and acceptance].
What is consideration?
Each party gives something of [value]; must be [legal], [specific], and [not past] or [free].
What is capacity?
Ability to contract. [Minors] (<19 in BC) have [voidable] contracts unless it’s for [necessities].
What is legality in contracts?
Contract subject must be [legal]. Illegal terms (e.g., drugs) are [unenforceable].
What is intention?
Parties must [intend] to enter into legal agreement. Determined using [objective test].
What makes an exclusion clause valid?
Must [apply], not be [unconscionable], and not breach [public policy].
What are the types of mistakes in contracts?
[Common], [misunderstanding], or [unilateral] mistakes can invalidate contracts.
What is misrepresentation?
[False statements] that induce entry into contract: [innocent], [negligent], or [fraudulent].
What are duress and undue influence?
What is unconscionability?
abuse of fairness [Unfair] or [oppressive] contract terms. Courts may declare contract [voidable].
When does a contract end?
[Performance], [breach], [frustration], or [mutual agreement].
What is the role of insurance in contracts?
businesses can use insurance as a risk management technique to transfer risk to someone else (an insurer)
