Test 2 Book Notes - Copy

Test 2 Book Notes - Copy - Chapter 10 Contracts exist to...

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Chapter 10 Contracts exist to make business matters more predictable Judicial restraint: a court’s reluctance to interfere with the terms of a contract. (less flexible more predictable) Judicial activism: courts willingness to change or ignore a contract that it perceives as unjust. (more flexible but less predictable) 4 elements of a contract: Agreement: 1 party makes an offer, and the other accepts Consideration: Had to be bargaining that leads to an exchange between parties Legality: Contract must be for a lawful purpose Capacity: parties must be adults of sound mind A contract is a promise that the law will enforce Noncompetition agreement: 1 party agrees not to compete with another Bilateral contract: a promise made in exchange for another promise. “I give 2million to make a movie and I agree” Unilateral contract: 1 party makes a promise that the other party can accept only by doing something. “ill give you $100 to mow my lawn this weekend” Expressed contract: all terms of contract are explicitly stated Implied contract: mowing lawn on a continual basis. Executor contract: agreement in which 1 or more parties has not yet fulfilled its obligations Executed contract: all parties have fulfilled their obligations. Voidable contract: 1 party may void the contract Void agreement: a contract that neither party can enforce. Illegal or no legal authority Quasi contracts seldom succeed. Quantum merit: damages awarded in a quasi-contract case. UCC: sale of goods, negotiable instruments, bank deposits, letter of credit, investment securities, and certain legal rights. Common law: sale of a condo or anything unmovable, contracts for service, employment, real estate.
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Sale of goods for anything over $500 is only enforced if it is in writing Promissory estoppel: requires that the defendant made a promise knowing that the plaintiff would likely rely, and the plaintiff did so. It would be wrong to deny recovery. (insurance agent saying your covered even when you are not) Quasi-contract: requires that the defendant received a benefit, knowing that the plaintiff would expect compensation, and it would be unjust not to grant. (setting up farm land for next year, guy in hospital) Chapter 19- Intro to Sales Common law statue of frauds requires any agreement for the sale of land to be in writing and signed by the defendant. Under UCC only thing needed to be put in the memo is quantity UCC does not include money or investment securities In a mixed contract the UCC will govern if the predominant purchase is the sale of goods Merchant: is someone who routinely deals in the particular goods involves, or has special knowledge or skill in those goods, or who uses a special agent.
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This note was uploaded on 09/01/2011 for the course FIN 3055 at Virginia Tech.

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Test 2 Book Notes - Copy - Chapter 10 Contracts exist to...

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