BUS 204 Ch. 11

What factors make an agreement enforceable under the principle of quasi-contract? Choose 2 answers.

1. The enriched party knows about the benefit and keeps it. 2. One party is being enriched at the expense of the other.

voidable contract

A contract that may be legally avoided (canceled) at the option of one of the parties.

quasi contracts

A fictional contract imposed on parties by a court in the interests of fairness and justice; usually, quasi contracts are imposed to avoid the unjust enrichment of one party at the expense of another.

promisee

A person to whom a promise is made.

promisor

A person who makes a promise.

offeror

A person who makes an offer to contract

promise

A person's assurance that he or she will or will not do something.

What must a plaintiff show to be awarded a quasi-contract in a lawsuit?

The defendant was unjustly enriched.

Carol and Al enter into a contract for the sale of a painting. Carol pays Al the asking price and Al delivers to Carol the painting. This contract is an:

executed contract.

Zayn boards the Big Rock Metro to ride downtown to his job. Zayn gives his money to the driver and takes his seat. Neither the driver nor Zayn says anything. Zayn and the bus driver:

have an implied contract.

Sal has ordered 100 pounds of shrimp for his restaurant from Sam every Friday for 5 years and has always paid that week's market price. One Friday, Sal decides to take a vacation but doesn't tell Sam. Sam claims they have a contract, even though it was never written down. What kind of contract do they have?

implied-in-fact

In a unilateral contract:

substantially undertaking performance prevents the offeror from revoking the offer.

In what situations would a court be likely to award a quasi-contract? Choose 2 answer choices.

1. When the unjust enrichment is a relatively insignificant amount of money 2. If the defendant was unjustly enriched and played a part in deceiving the plaintiff

implied contract

A contract formed in whole or in part from the conduct of the parties (as opposed to an express contract).

void contract

A contract having no legal force or binding effect.

formal contracts

A contract that by law requires a specific form, such as being executed under seal, to be valid.

informal contract

A contract that does not require a specified form or formality in order to be valid.

exectued contract

A contract that has been completely performed by both parties.

executory contract

A contract that has not yet been fully performed.

valid contract

A contract that results when the elements necessary for contract formation (agreement, consideration, contractual capacity, and legality) are present.

objective theory of contracts

A theory under which the intent to form a contract will be judged by outward, objective facts as interpreted by a reasonable person, rather than by the party's own secret, subjective intentions. Objective facts might include what a party said when entering into the contract, how a party acted or appeared, and the circumstances surrounding the transaction.

bilateral contract

A type of contract that arises when a promise is given in exchange for a promise.

unenforceable contract

A valid contract rendered unenforceable by some statute or law.

Jones Construction Company is building a series of new subdivisions in Newtown over the next two years. Jones enters into a verbal agreement with Harley Concrete Inc. to construct all the driveways and sidewalks in the subdivisions that Jones will be building. Jones and Harley agree on a price of $130 per cubic yard and that Jones will pay Harley at the end of each project. Harley completes the first project, which is four sidewalks and sixteen driveways, and bills Jones for the project. Jones decides that the price is too high and refuses to pay, claiming that they have no obligation to pay because the parties did not have a valid contract. If Harley sues Jones for payment the court would probably:

apply quasi contract theory and award the fair market value of the work that Harley completed.

When party A and B form a contract and both parties fully perform, the contract is considered:

executed.

Quon and Bert have signed a contract for Bert to mow Quon's grass every week in June, July, and August for a price of $40 per week. They have agreed to all the necessary terms, but Bert has not yet mowed because it is still May. What type of contract do they have?

executory

Don and Kim have entered into a contract for the purchase of a car. Don has paid money for the car, but Kim has not yet delivered it. This is an:

executory contract.

Mia contracted with Greencare Lawn Service for a pest treatment on Mia's lawn for $1,000. Pat lives next door to Mia. Greencare mistakenly treats Pat's lawn instead of Mia's. When Greencare seeks payment from Pat, Greencare can probably receive:

from Pat an amount less than the contract amount that will reimburse Greencare for expenses incurred.

When ambiguity in a contract's language exists, a court will: (Select all that apply)

interpret the terms against the drafting party

offeree

the person to whom an offer is made; the one who has the power to create a valid contract by making an appropriate acceptance

What is the term for a contract agreement in which an offeror promises to pay after the occurrence of a specified act, and the offeree is not required to respond in words?

unilateral contract

Contests, lotteries, and competitions with prizes are common examples of:

unilateral contracts

What type of contract exists when at least one party has the option of canceling it?

voidable

express contract

A contract in which the terms of the agreement are fully and explicitly stated in words, oral or written.

unilateral contract

A contract that results when an offer can be accepted only by the offeree's performance.

contract

An agreement that can be enforced in court; formed by two or more parties, each of whom agrees to perform or to refrain from performing some act now or in the future.

extrinsic evidence

Evidence that relates to a contract but is not contained within the document itself, including the testimony of the parties, the testimony of witnesses, and additional agreements and communications. A court may consider extrinsic evidence only when a contract term is ambiguous and the evidence does not contradict the express terms of the contract.

You decide to get a credit card in order to begin building your credit history. It is your first credit card and when you receive the agreement with the credit card company filled with legally complex boilerplate language, you sign it knowing that if you do not, you will not be able to get the card. Buried deep within the terms, however, a discrepancy existed that the credit card company never caught before sending the agreement to customers. One section allowed for the credit card company to raise interest rates as long as it provided users a 30 day notice, but another section stated that interest rates could only be changed once per year. The company has increased your interest rate four times already this year and you decide you have had enough and take them to court. In whose favor will the court interpret the terms of the contract?

The court will interpret it in your favor because you did not draft the agreement.

If an individual shopping for groceries opens a bottle of water from their cart and drinks it before they have paid for their items:

a quasi-contract has been created.

Which of the following creates a bilateral contract? (Select all that apply)

a sale of goods with payment at delivery

Maryanne offers to sell her 2015 Mustang convertible to April for $15,000, and April agrees to those terms. April brings the $15,000 to Maryanne, and Maryanne promises to deliver the Mustang to April the next day after she has it detailed. At this point, Maryanne and April have:

an executory contract.

When an agreement fails to qualify as an enforceable contract, but one of the parties breaches the agreement, the non-breaching party:

may sue for unjust enrichment.

Brindley has an old shed on her property that needs to be removed. She posts the following ad on Facebook: "Shed needs to be gone. You take down and haul away. (Much of the wood is reusable.) $100 to the first person to show up and haul this away." This is an example of a(n):

unilateral contract.