Chapter 8- Introduction to Contracts and Agreement

Which of the following circumstances will not terminate an offer? A- Revocation by the oferor B- Revocation by the offeree C- Rejection by the offeree D- Lapse of time or failure of another condition specified in the offer

B- Revocation by the offeree

Which of the following is not a required element of contract formation? A- Commercial objective B- Consideration C- Contractual capacity D- Legal object

Commercial Objective

Elements of a valid offer include:

Intent Definite and certain terms Communication to the offeree

A(n) _____ contract may be recognized by a court in order to prevent one party from being unjustly enriched at the expense of another party.

Quasi-

Intent

The intended purpose or goal of an action, especially in a contract.

A _______ contract represents a situation where the offeror seeks performance from the offeree to form the contract.

Unilateral

A unilateral contract is commonly defined as a(n) ______.

A promise exchanged for an act.

A bilateral contract is commonly defined as a(n) ______.

A promise in exchange for a promise.

Legal Object

A purpose that does not violate a statute or public policy.

Voidable

A term applied to a contract that one or both parties have the ability to either withdraw from or enforce.

Option Contract

An agreement whereby the offeree gives the offeror a piece of consideration in exchange for the offeror's agreement to hold the offer open for the specified period of time.

Explain why the first question a person should ask when getting ready to analyze a contract problem is, "Is this alleged contract for the sale of a good?"

Because Article 2 of the UCC governs contracts for the sale of goods.

What is the difference between an offer for a unilateral contract and an offer for a bilateral contract? Why might that difference be important to understand?

Bilateral is a promise for a promise, while a unilateral contract is a promise for an action. The offeror does not have to fulfill their end in a unilateral contract until the action is performed, but either party can sue in a bilateral contract if one fails.

What must a party prove to recover under the theory of quasi-contract?

The enrichment must be unjust (purposefully taking advantage of a mistake instead of interfering).

Express Contract

A contract in which all the terms are clearly set forth in either written or spoken words.

Implied Contract

A contract that arises not from words of agreement but from the conduct of the parties.

Valid

A contract that contains all the legal elements of a contract: agreement (offer and acceptance), consideration, contractual capacity, and legal object.

Void

A contract that is, in effect, not a contract at all. Either its object is illegal or it has some defect that is so serious that it is not a contract.

Unenforceable

A contract that, because of a law, cannot be enforced by the courts.

The "mailbox rule" provides that...

An acceptance is valid when it is placed in the mailbox.

Consideration

The bargained-for exchange; what each party gets in exchange for his or her promise under contract.

Contractual Capacity

The legal ability to enter into a binding agreement.

The "mirror-image" rule requires that...

The terms of the acceptance must be identical to the terms of the offer.

Contractual _______ refers to the legal ability to enter into a binding agreement.

Capacity