REG 1 - R6 Contracts Flashcards Preview

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Flashcards in REG 1 - R6 Contracts Deck (20):
1

Contracts are void when

Contracts are entered into by someone who has been adjudicated (pronounced by judicial sentence) incompetent.

2

What action will discharge the non-breaching party?

Material breach of the contract

3

Delay in Performance

May cause a discharge, but only in a contract stating that time is of the essence (UCC Sales contract), or if the delay otherwise materially breaches the contract.

4

What happens if a party tenders performance in a contract?

The other party will also have to perform. Tender of performance does not discharge the other party.

5

Novation

The agreement is unchanged but one of the original parties is released and a new party is substituted into their place.

6

Substituted Contract

The original parties are both released from the original agreement but are BOTH bound by a new agreement.

7

Foreseeability of Damages

If a contract is breached, the foreseeable damages:
1. Should arise naturally from the breach OR
2. Both parties should agree these damages are
the probable result of the contract breach

8

Mitigation of Damages

In every case, the non-breaching party has a duty to make reasonable efforts to cut down on losses resulting from a breach. If they don't, there's a chance they won't collect damages that might have been avoided.

9

How do you make out an action for negligent misrepresentation?

The plaintiff must show both actual and justifiable reliance on the misrepresentation.

10

Unilateral mistake

A defense to a contract if the non-mistaken party knew or should have known of the mistake.

11

Condition Precedent

A condition that must occur BEFORE the other party must perform.
Example: Qualify for a mortgage

12

Condition Concurrent

Conditions that must occur SIMULTANEOUSLY.
Example: Transactions at stores.

13

Condition Subsequent

A condition that will occur after a party's duty to perform has arisen and will cut off that duty.
Example: Engagement ring

14

Valid Consideration

Exists if there is a bargained for exchange of something of legal value. If the act promised has already been performed, the bargain element fails.
"PAST consideration is NO consideration."

15

Assignable contract rights

All contract rights are assignable unless the assignment would result in a change in the obligor's risk.
Rights to malpractice insurance are not assignable because the insurer's risk varies based on the identity (and characteristics) of the insured.

16

Which actions will result in the discharge of a party to a contract?

-Prevention of performance
-Accord and satisfaction

17

Accord and Satisfaction

Accord- the agreement to discharge the obligation Satisfaction- the legal consideration which binds the parties to the agreement

18

Undue Influence

When a person in a position of trust or confidence takes unfair advantage of the relationship such that the other party's free will to contract is overcome.

19

Anticipatory Repudiation

When it makes it very unlikely that the person receiving the services will be able to pay.

20

Statute of limitations on breached contract

Begins from the time the contract was breached, not from the time the contract was entered.