Business Law: Introduction to Contracts

What are the 6 requirements of a valid contract?

-Agreement (or "Mutual Assent") -Consideration -Capacity -Legality -Genuineness of assent -Writing and Form

What are the 2 "defenses to formation"?

-Capacity -Writing and form

What are the basic elements of an offer? (3)

-Serious objective intent -Terms reasonable and definite and certain -Offer communicated to offeree

To determine if there is a contract, what 3 things does one look at?

-What was said when entering into the contract -How party acted or appeared -Circumstances surrounding the transaction

What is a contract

A promise or a set of promises for the breach of which the law gives a remedy, or the performance of which the law in some way recognizes as a duty."

What is the mailbox rule of acceptance?

Acceptance is effective at the time the offeree sends or delivers the communication via a mode expressly

What is the mirror image rule?

At common law, requires an offeree's acceptance to match the offeror's offer exactly. Any change in, or addition to the terms terminates the offer and constitutes a counter offer

How does someone agree to the terms of a shrink wrap agreement?

By keeping the items

What is a shrink wrap agreement?

One in which the terms are expressed inside the box in which the goods are packaged

___ ____ cannot be enforced because of certain legal defenses against it, such as statute or law.

Unenforceable contracts

Voluntary act that expresses assent or agreement to terms of the offer is ____.

acceptance

Contracts are founded on an agreement meaning there was an offer and that offer was ____.

accepted

Parties must have the ___ to contract, or the legal ability to contract.

capacity

The acceptance must be _____ to the offeror.

communicated

The offer must be _____ to the offeree to be effective.

communicated

Advertisements are generally not offers but if the ad contains __ ___ that invited acceptance they can be. (reward for lost dog).

definite terms

Simply put, a contract is an agreement that can be:

enforced in court

Contract in which the parties have fully performed the promise is an ___ ___.

executed contract

Contract in which a promise remains unfulfilled by one party is an ___ ____.

executory contract

If a contract is ratified, both parties must ____ ____.

fully perform

To determine whether a contract has been formed ____ is extremely important.

intent

It is important to be able to dishtinguish between an actual offer and an ___ to ____.

invitation to deal

What is an implied contract?

is inferred from the actions or conduct of the parties.

Subject matters in a contract must be _____ and not _____.

legal and not illegal

A void contract is actually ___ a contract at all.

not

In a unilateral contract, someone must ___ to bind the parties.

perform

Bilateral contracts are those where ____ is not necessary to bind the parties.

performance

In unilateral contracts, the offer is only accepted by ____.

performance

Contracts are supported by consideration meaning there is something bargained for and given in exchange for a _____.

promise

Bilateral contracts are a promise for a ____

promise.

Contracts must be expressed in ___ ____.

proper form

Generally, recovcation must be ____ by the offeree or offeree's agent.

received

Inquiries such as "would you accept $50" are not _____ of offers.

rejections

If a contract is voided both parties are ____ from it.

released

The UCC was writen to cover the ___ of ____.

sale of goods

Formal contracts require ___ ___ or method of creation.

special form

Informal contracts need no _____ or method of creation.

special form

A unilateral contract cannot be revoked if one side has ___ ___.

substantially performed

What is an express contract?

the parties set forth their intentions specifically and definitely in writing or orally.

Written and oral contracts can be binding if rules are ___ and ____.

understood and followed

A promise on one side only is a ___ ___.

unilateral contract

A ___ contract is legally binding and enforceable, as all elements are met.

valid

A ____ contract can never have any legal effect.

void

A ____ contract can be affirmed or rejected at the option of one or more of the contracting parties.

voidable

Contracts are based on the geuine assent and __ ___ as a party to the contract.

voluntary involvement