Exam 2 Outline

Exam 2 Outline - Business Law Exam 2 CHAPTER 9 CONTRACTS K...

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Business Law Exam 2 CHAPTER 9 – CONTRACTS K = contract Four Elements of a Contract 1.Agreement a.Offer: a proposal by one person to another that is intended to create legal relations on acceptance by the person to whom it is made b.Acceptance: the actual or implied receipt and retention of that which is tendered or offered 2.Consideration: passing of something of value or suffering a detriment 3.Capacity: sound mind and sober, have to be of age a.Ability to incur legal obligations and require legal rights 4.Legality Bilateral vs. Unilateral **Carbolic Smoke Bell advertisements are not always offers, it is just an invitation Functions of Contracts Create a type of private law that governs our relations with others Facilitates planning necessary in a modern industrialized age Methods of Contracts Standardized form contracts: contracts that are preprinted by one party and presented to another party to sign Oral or written Two or more parties agree Offer, anyone can accept Accept by performance Two Types of Contracts: 1. Executory: hasn’t been fully carried out 2. Executed: all parties have fully performed their contractual duties **Common Law Rule: a unilateral offer can be revoked at any time **Part performance signifies sign of completion (traditionally), part performance in unilateral contract prevents revocation
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A valid contract is one that meets all of the legal requirements for a binding contract An unenforceable contract is one that meets the basic legal requirements for a contract but may not be enforceable because of some other legal rule Voidable contracts are those in which one or more of the parties have the legal right to cancel their obligations under the contract Void contract are agreements that create no legal obligations and for which no remedy will be given ( AB INITIO – void from the beginning) o Example: a contract to kill someone In an express contract, the parties have directly stated the terms of their contract orally or in writing at the time the contract was formed When the surrounding facts and circumstances indicate that an agreement has in face been reached, an implied contract has been created Sources of Contract Law 1. Common Law : governs contracts for the sale of real estate, services, and intangibles 2. Uniform Commercial Code (UCC): enacted to provide uniformity a. Fairly solve common problems in everyday commercial transactions b. Article 2 expressly applies only to contracts for the sale of goods not the sale of real estate or intangibles such as stocks and bonds (also not applied to service contracts) i. When a merchant sells something the good is used for the intended purpose ii. Goods are TANGIBLE, MOVEABLE, PERSONAL PROPERTY c. Duty of good faith : used to promote fair dealing and higher standards in the market place, “honesty in fact” d. Unconscionable contract : one that is grossly unfair or one-sided, the UCC gives the courts broad discretionary powers to deal fairly with such contracts
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This note was uploaded on 11/15/2010 for the course BMGT 380 taught by Professor Mark during the Fall '08 term at Maryland.

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Exam 2 Outline - Business Law Exam 2 CHAPTER 9 CONTRACTS K...

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