In such cases the courts may be called upon to settle

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Unformatted text preview: ases, the courts may be called upon to settle the dispute in accordance with established rules of law that determine each party’s rights and obligations under a valid contract. Many misunderstandings and disagreements between contracting parties, as well as costly, time-consuming litigation, can easily be avoided if each party has a basic understanding of the law of contracts. The following chapters will explore the requirements for the formation of valid contracts and the remedies available when they are breached. Under the Uniform Commercial Code, the rules for sales of goods contracts are sometimes different. Where the UCC rules are an exception to a basic common law rule, they will be briefly discussed in this section, and other issues concerning the UCC and sales of goods will be explored in later chapters. But the common law of contracts is very much in effect today and is crucial to the running of every business, regardless of its size. rog80328_04_c04_062-088.indd 64 10/26/12 5:42 PM Contracts: Offer, Acceptance, and Consideration 4 Learning Objectives After studying this chapter, you will be able to: 1. Describe the difference between express, implied, bilateral, unilateral, simple, formal, and quasi contracts. 2. Explain the requirements for a valid offer and acceptance. 3. Explain the ways an offer may terminate. 4. Define consideration. 5. Recognize situations where consideration is not present. © Getty Images/Jupiterimages/Thinkstock Chapter Overview 4.1 Types of Contracts • • • • Express Contracts v. Implied Contracts Bilateral Contracts v. Unilateral Contracts Simple Contracts v. Formal Contracts Quasi Contracts (Contract Implied in Law) 4.2 The Offer • Clear Intent: An Unequivocal Promise • Reasonably Certain Terms • Offers and Termination 4.3 Acceptance • Communicating the Acceptance rog80328_04_c04_062-088.indd 65 4.4 Consideration • • • • • What Isn’t Consideration? Past Consideration Preexisting Duty Illusory Promises Distinguishing Illusory Promises and Requirement Contracts • Exceptions to the C...
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