(COURSE 1) SECTION 8: GENERAL CONTRACT LAW IN CA

OFFERS THE BUYER THE, BUT NOT THE OBLIGATION, TO BUY AT AN AGREED-UPON PRICE DURING A CERTAIN PERIOD OF TIME OR ON A SPECIFIC DATE

OPTION

AN AREA WHERE THE PARTIES CAN INCLUDE SPECIFIC TERMS NOT INCLUDED IN THE PRE-PRINTED CONTRACT FORM

OTHER PROVISIONS

A MUTUAL CONTRACT THAT INVOLVES AN EXCHANGE OF PROMISES OR OTHER CONSIDERATIONS BETWEEN TWO PARTIES

BILATERAL CONTRACT

THE LEGAL AGREEMENT BETWEEN A BUYER AND A BROKER HIRED TO REPRESENT THE BUYER'S INTEREST

BUYER REPRESENTATION AGREEMENT

IN CALIFORNIA, HOW LONG DO YOU HAVE TO BRING ACTION BASED ON LIBEL, SLANDER, INJURY/DEATH, OR PAYMENT OF A FORGED CHECK

1 YEAR

TO MEET THAT STATUTE'S REQUIREMENTS, THE WRITTEN AGREEMENT MUST: 1. 2. 3.

1. IDENTIFY THE CONTRACTING PARTIES 2. CLEARLY IDENTIFY THE SUBJECT MATTER OF THE CONTRACT 3. PRESENT THE ESSENTIAL TERMS AND CONDITIONS OF THE CONTRACT

WHAT ARE THE 5 ELEMENTS REQUIRED FOR A VALID CONTRACT?

1. LEGALLY COMPETENT PARTIES 2. OFFER AND ACCEPTANCE 3. CONSENT 4. LEGAL PURPOSE 5. CONSIDERATION

THE WRONGED PARTY IN A BREACH OF CONTRACT SITUATION CAN DO WHAT 3 THINGS?

1. TERMINATE 2. ACCEPT 3. SUE

WHEN A CONTRACT FALLS TO PIECES, WHAT ARE THE 2 OPTIONS TO REFORM

1. THE PARTIES MUTUALLY AGREE TO DO SO BY CREATING AND SIGNING A NEW CONTRACT 2. ONE PARTY CAN COMPEL THE OTHER PARTY TO COMPLY THROUGH A LAWSUIT

IN CALIFORNIA, HOW LONG DO YOU HAVE TO BRING ACTION AFTER BEING AWARDED A COURT JUDGMENT

10 YEARS

IN CALIFORNIA, HOW LONG DO YOU HAVE TO BRING ACTION BASED ON AN ORAL AGREEMENT (EX: LEASE THAT IS SHORTER THAN ONE YEAR)

2 YEARS

IN CALIFORNIA, HOW LONG DO YOU HAVE TO BRING ACTION BASED ON THE DISCOVERY OF FRAUD

3 YEARS

IN CALIFORNIA, HOW LONG DO YOU HAVE TO BRING ACTION BASED ON A WRITTEN INSTRUMENT (EX: A REAL ESTATE CONTRACT)

4 YEARS

IN CALIFORNIA, HOW LONG DO YOU HAVE TO RECOVER TITLE TO REAL PROPERTY?

5 YEARS

A PROMISE TO BE BOUND BY THE EXACT TERMS MADE IN THE OFFER

AN ACCEPTANCE

A PROMISE MADE BY ONE PARTY, REQUESTING SOMETHING IN EXCHANGE FOR THAT PROMISE

AN OFFER

WHAT IS IT CALLED WHEN ONE PARTY TO A CONTRACT TRANSFERS THE CONTRACTUAL RIGHTS AND OBLIGATIONS TO ANOTHER BUT REMAINS LIABLE FOR THE CONTRACT TERMS?

ASSIGNMENT

TO SUBSTITUTE A NEW PARTY FOR ONE OF THE ORIGINAL PARTIES STATED IN THE CONTRACT

ASSIGNMENT OF CONTRACT

ALEX, A HIGH SCHOOL FRESHMAN, STARTED A NEIGHBORHOOD LAWN CARE BUSINESS. SIMONE DECIDES TO HIRE ALEX TO MOW HER LAWN EVERY TWO WEEKS. ALEX PRESENTS SIMONE WITH A WRITTEN CONTRACT OUTLINING THE SERVICES TO BE PROVIDED AND THE FEE SIMONE WILL PAY. WHICH OF THE FOLLOWING IS TRUE IN THIS SITUATION?

BECAUSE A MINOR CANT ENTER INTO A CONTRACT, THIS CONTRACT IS TECHNICALLY INVALID, VOIDABLE, AND UNENFORCEABLE IF BOTH PARTIES ARE CONTENT TO UPHOLD THEIR AGREEMENT, THE FACT THAT IT'S NOT LEGALLY BIDNIND DOESNT MATTER.

AN AGENT'S COMPENSATION FOR PERFORMING THE DUTIES OF THE AGENCY; USUALLY A PERCENTAGE OF THE SELLING PRICE OF PROPERTY

COMMISSION

AN ESSENTIAL ELEMENT OF A CONTRACT MEANING IT MUST BE ENTERED INTO AS A FREE AND VOLUNTARY ACT, WITHOUT UNDUE INFLUENCE OR DURESS

CONSENT

THE GIVING OF SOMETHING OF VALUE, WHICH CAN INCLUDE THE AGREEMENT TO NOT DO SOMETHING. CONSIDERATION IS A REQUIRED ELEMENT OF A BINDING CONTRACT

CONSIDERATION

WHAT CONTRACT PROVISION AN ITEM OF VALUE USED TO SHOW GOOD FAITH AND INTENT

CONSIDERATION

LEGAL WRITTEN AGREEMENT BETWEEN BUYER AND SELLER THAT STATES THE PURCHASE PRICE AND OTHER TERMS FOR TRANSFER OF PROPERTY

CONTRACT FOR SALE

THE PARTIES AGREE TO TERMINATE BEFORE THE CONTRACT IS FULLY EXECUTED

CONTRACT RELEASE

THE STATUTE OF FRAUDS DEALS SPECIFICALLY WITH ____

CONTRACTS

WHAT CONTRACT PROVISION SETS A DEADLINE AND LOCATION FOR THE PARTIES TO COMPLETE THIER CONTRACTUAL OBLIGATIONS AND SETTLE THE TRANSACTION

DATE AND PLACE OF CLOSING

WHAT CONTRACT PROVISION SETS THE TIMELINE BENCHMARK FOR ALL CONTRACTUAL DEADLINES

DATE OF THE AGREEMENT

MEANS THAT BOTH PARTIES HAVE COPIES OF THE SIGNED CONTRACTS

DELIVERY

RECEIPT FOR EARNEST MONEY GIVEN BY BUYER TO SECURE AN OFFER

DEPOSIT RECEIPT

WHAT CONTRACT PROVISION IDENTIFIES THE REAL PROPERTY BEING TRANSFERRED

DESCRIPTION OF THE PROPERTY

_____ APPLIES TO PROPERTY THAT IS DESTROYED, DAMAGED, OR TAKEN BY EMINENT DOMAIN

EMINENT DOMAINTHE UNIFORM VENDOR AND PURCHASER ACT

A CONTRACT THAT WILL STAND UP IN COURT

ENFORCEABLE CONTRACT

A CONTRACT IN WHICH ALL THE PARTIES HAVE MET ALL TERMS OF THE CONTRACT

EXECUTED CONTRACT

A CONTRACT IN PROGRESS; ONE OR MORE TERMS OF THE CONTRACT REMAIN UNDONE

EXECUTORY CONTRACT

A STATED (WRITTEN OR ORAL) AGREEMENT BETWEEN TWO PARTIES TO SPECIFIC TERMS

EXPRESS CONTRACT

LOSS OF MONEY OR ANYTHING OF VALUE, DUE TO FAILURE TO PERFORM

FORFEITURE

CONTRACTS ORDER OF PRIORITY

HANDWRITTEN TYPED PRE-PRINTED

A CONTRACT IS NOT VALID IF IT IS WRITTEN FOR A _______ PURPOSE

ILLEGAL

A CONTRACT THAT IS BASED ON THE ACTIONS OR BEHAVIORS OF THE PARTIES, NOT ON WORDS

IMPLIED CONTRACT

A CONTRACT IN WHICH ONE OR MORE OF THE ESSENTIAL ELEMENTS IS MISSING IS ___

INVALID

WHAT IS REQUIRED FOR CONTRACT VALIDITY ONLY WHEN THE NATURE OF THE CONTRACT IS REAL PROPERTY?

IT MUST BE IN WRITING

THE IDEA THAT A CONTRACT MUST NOT PROPOSE TO DO ANYTHING ILLEGAL; SUCH A CONTRACT WOULD BE UNENFORCEABLE

LEGAL PURPOSE

THE RESIDENTS OF BLAIR AVENUE ARE A CLOSE-KNIT BUNCH. THEY'RE ALL YOUNG COUPLES WITH SMALL CHILDREN, AND THEY DON'T WANT THIS DYNAMIC TO CHANGE WHEN TWO OF THE COUPLES HAVE TO MOVE. THOSE COUPLES SIGN AN AGREEMENT PROMISING NOT TO SELL TO ANYONE WITHOUT KIDS OR TO ANYONE OVER THE AGE OF 50. THE CONTRACT CAN'T BE ENFORCED BECAUSE IT'S MISSING ______.

LEGAL PURPOSE

A PARTY WHO HAS THE CAPACITY (LEGAL AND MENTAL) TO ENTER IN TO A CONTRACT

LEGALLY COMPETENT PARTY

REFERS TO AN AGREEMENT BY THE BUYER TO PAY THE SELLER A SPECIFIED AMOUNT OF DAMAGES IF THE BUYER BREACHES THE CONTRACT.

LIQUIDATED DAMAGES EX: EARNEST MONEY DEPOSIT

A CONTRACT BETWEEN A CLIENT AND AGENT TO SELL REAL PROPERTY

LISTING AGREEMENT

WHAT CONTRACT PROVISION IDENTIFIES HOW THE PROPERTY WILL BE FINANCED AND ANY FINANCING CONTINGENCIES

MORTGAGE TERMS AND DEFINITIONS

WHAT CONTRACT PROVISION IDENTIFIES WHOS CONTRACTUALLY OBLIGATED

NAMES AND ADDRESSES

MEANS THAT ALL PARTIES ARE AWARE OF THE TERMS OF THE CONTRACT

NOTICE

WHEN THE OFFEREE ACCEPTS THE EXACT TERMS OF THE OFFEROR AND NOTIFIES THE OFFEROR OF THAT ACCEPTANCE. THIS IS CALLED ______ AND ____

NOTICE AND DELIVERY

WHAT'S THE KEY DIFFERENCE BETWEEN ASSIGNMENT AND NOVATION OF A CONTRACT?

NOVATION RELEASES THE ORIGINAL PARTY FROM ALL OBLIGATIONS, WHILE ASSIGNMENT DOES NOT

AN AGREEMENT BETWEEN THE PARTIES; A MEETING OF THE MINDS

OFFER ANDD ACCEPTANCE

A FULLY EXECUTED, VALID WRITTEN CONTRACT TRUMPS ALL PRIOR NEGOTIATION. THIS IS THE _____________

PAROL EVIDENCE RULE

_____ MEANS TO MEET ALL OF THE CONTRACT'S TERMS

PERFORMANCE OF A CONTRACT

BOBBY HAS JUST FOUND OUT THAT HE WAS NAMED AS THE EXECUTOR OF HIS GRANDFATHER'S WILL. IN ACCORDANCE WITH THE TERMS OF THE CONTRACT, HE MAY SELL HIS GRANDFATHER'S PROPERTY WHILE SERVING AS A ______.

PERSONAL REPRESENTATIVE

A LEGAL SECTION IN A CONTRACT OR LAW

PROVISIONS

A DEFINITIVE END OF THE PARTIES' COMMITTMENTS UNDER AN AGREEMENT USUALLY DUE TO BREACH OF CONTRACT- ONE IN WHICH THE PARTIES ARE RETURNED TO THEIR PRE-CONTRACT STATUS, WHICH IN LEGAL TERMS IS CALLED STATUS QUO ANTE.

RECISSION (LIKE AN ANNULMENT)

REDRAFTING A CONTRACT IS _______

REFORMATION

WHAT IS CONSIDERATION IN REGARD TO A CONTRACT?

SOMETHING OF VALUE IS GIVEN IN EXCHANGE FOR SOMETHING OF VALUE

REQUIRES THE PARTIES TO MAKE GOOD ON THE PROMISES THEY MADE

SPECIFIC PERFORMANCE

TOM AND JIM ARE NEIGHBORS. JIM WANTS TO BUY TOM'S RENTAL PROPERTY. IN THE CONTRACT THEY SIGN, JIM IS IDENTIFIED ONLY AS "THE NEIGHBOR." WHICH STATUTE OR CONTRACT ELEMENT DOES THIS VIOLATE?

STATUTE OF FRAUDS

A FORMAL OFFER

TENDER

IF A BUYER HAS TAKEN POSSESSION OF A PROPERTY, BUT THE SELLER STILL HOLDS THE TITLE, WHO ASSUMES THE RISK?

THE BUYER IS STILL OBLIGATED TO ASSUME THE RISK, EVEN WITHOUT THE TITLE BECAUSE THEY HVE TAKEN POSSESSION

PROVIDES THAT IN MOST CASES, A WRITTEN AGREEMENT IS THE FINAL AND COMPREHENSIVE EXPRESSION OF THE PARTIES' AGREEMENT, AND GENERALLY PROHIBITS THE INTRODUCTION OF PREVIOS VERBAL OR WRITTEN STATEMENTS THAT CONTRADICT, AUGMENT, OR OTHERWISE CHANGE THE WRITTEN CONTRACT TERMS

THE PAROL EVIDENCE RULE

A LAW REQUIRING CONTRACTS CONVEYING OWNERSHIP IN REAL PROPERTY TO BE IN WRITING TO BE ENFORCEABLE

THE STATUTE OF FRAUDS

WHAT DOES THE PAROL EVIDENCE RULE SAY ABOUT CONTRACTS?

THE TERMS AGREED TO IN A WRITTEN CONTRACT ARE THE ONLY TERMS RELATING TO THAT CONTRACT

MOST REAL ESTATE CONTRACTS CONTAIN THE PHRASE "_______" TO PREVENT UNNECESSARY DELAYS TO THE PROCESS WHICH MAY HARM THE PARTIES

TIME IS OF THE ESSENCE

TRUE OR FALSE: THE ONLY PEOPLE/EMTITIES THAT ARE NOT CAPABLE OF ENTERING INTO A REAL ESTATE CONTRACT ARE MINORS AND MENTALLY INCOMPETENT PARTIES

TRUE

TRUE OR FALSE: NOVATION IS WHEN THE RIGHTS AND OBLIGATIONS OF AN ORIGINAL PARTY TO AN EXISTING CONTRACT ARE TAKEN BY ANOTHER PARTY, CREATING A NEW CONTRACT.

TRUE: NOVATION=SUBSTITUTION

TRUE OR FALSE: A GUILTY PARTY DOES NOT HAVE THE RIGHT TO TERMINATE A BREACHED CONTRACT

TRUE: THE GUILTY PARTY WOULD NEED THE AGGRIEVED PARTY'S PERMISSION OR THE AGGRIEVED (INNOCENT) PARTY MAY DECIDED ON THEIR OWN TO TERMINATE.

A CONTRACT THAT WILL NOT HOLD UP IN COURT

UNENFORCEABLE CONTRACT

A CONTRACT IN WHICH CONSIDERATION (SUCH AS A PROMISE) IS ONLY GIVEN BY ONE PARTY TO THE OTHER

UNILATERAL CONTRACT

A CONTRACT THAT CONTAINS ALL THE ESSENTIAL ELEMENTS IS ___

VALID

A CONTRACT FOR AN ILLEGAL PURPOSE IS ____

VOID

A CONTRACT WITH NO LEGAL FORCE OR EFFECT, WHICH MEANS THE PARTIES ARE NOT BOUND BY IT

VOID

A CONTRACT THAT MAY BE CANCELLED BY ONE OR MORE PARTIES FOR ONE OF SEVERAL REASONS. IT MAY BE MISSING AN ESSENTIAL ELEMENT AND THUS INVALID. IT MAY CONTAIN A MISTAKE OR MISREPRESENTATION. IT MAY HAVE BEEN CREATED OR EXECUTED BY A PARTY UNDER DURESS

VOIDABLE

A ___ CONTRACT APPEARS VALID, BUT ONE OR BOTH PARTIES HAVE THE RIGHT TO RESCIND THE CONTRACT.

VOIDABLE

SYLVIA, WHO'S 15 YEARS OLD, AND HER NEIGHBOR MARGE, WHO'S 24, SIGN AN AGREEMENT THAT SYLVIA WILL BABYSIT MARGE'S TODDLER FOR THE SUMMER FOR $10 AN HOUR. WHAT TYPE OF CONTRACT IS THIS?

VOIDABLE: IT APPEARS TO BE VALID, BUT ONE OF THE PARTIES HAVE THE RIGHT TO RESCIND THE CONTRACT. IN THIS CASE, SYLVIA CAN ENFORCE THE CONTRACT, BUT MARGE CANNOT ENFORCE AGAINST SYLVIA BECAUSE SYLVIA IS A MINOR

ROBERT AND SARAH ENTER INTO A CONTRACT FOR SARAH TO PURCHASE ROBERT'S HOME. ROBERT DECIDES HE DOESN'T WANT TO SELL, AND IS ELATED WHEN HE FINDS OUT THAT SARAH'S ONLY 17 YEARS OLD. CAN SARAH FORCE ROBERT TO SELL?

YES, SARAH CAN REQUIRE THAT ROBERT FULFILL THE CONTRACT TERMS BECAUSE HE IS OVER 18. BUT ROBERT CANT REQUIRE SARAH TO FULFILL THE CONTRACT