Business Law Final- Ch.11-19

What is the result if a debtor writes a payment in full on a check on a unliquidated debt and the creditor crosses out the words payment in full

It creates an accord and satisfaction and extinguishes the debt

4 ways to terminate an offer by operation of law

Lapse of time, destruction of subject matter, death or incompetency, supervening illegality of proposed contract

A debt whose amount has been agreed on

Liquidated Debt

Acceptance upon dispatch, not recieved

Mailbox rule

A contract is substantially performed when

performance creates substantially the same benefits as those promised in the contract

Under the Statute of Frauds, land includes

physical objects permanently attached to it, such as buildings, fences, trees, and soil.

The concept of unconscionability originally applied to

the sale of goods only.

Maya and Nick enter into a contract. To be enforceable, the contract must include

the signature of the party against whom enforcement is sought

T/F a minor may enter into most contracts

this is the general rule, however it is a voidable contract at the option of the minor

State University provides housing on campus and in some adjacent off-campus neighborhoods. To lease a university house or apartment, a person must be a student at State. This requirement is a

a condition precedent

An intentional failure to comply with the terms of a contract is

breach

frustration of purpose

decreased value of what a party received under the contract

The act of accepting and giving legal force to an obligation that previously was not enforceable.

ratification

​Amy and Bob enter into a contract for Bob to perform waste management services for Amy's commercial properties. Later, Bob alters a material term—increases the price—without Amy's knowledge or consent. Amy can . . .

treat the contract as discharged

Gene, an accountant, convinces his client Hazel to sign a contract to invest her savings in 2Gether, a nonexistent social-networking Web site. There is clear and convincing evidence that Hazel did not act out of her free will

undue influence

This gives the mistaken party a right to relief from the contract.

unilateral mistake

Amount in dispute between parties , accord and satisfaction

unliquidated debt

App Developers, Inc. (ADI), enters into a contract with Carmen, the chief executive officer of SalesCorp, to create an app for the firm. To fulfill the contract, ADI hires Max and ten other student interns. With respect to the contract, Max is considered:

​an incidental beneficiary

Promissory Estoppel

(detrimental reliance): Recovery if reliance on promise of another.Requirements: Must be a clear and definite promise Promisee must justifiably rely on the promise Promisee reasonably relied on the promise by acting or referaining from some act The pomisees reliance was definite and resulted in a substantial detriment Justice will be served by enforcing promise

Unconscionable contract

A contract where the terms are so unscrupulos or grossly unfair as to be "void of conscience"

Contract terms

Agreement , consideration, capacity

Unliquidated debt

Amount in dispute

Four-Square Construction Company enters into a contract with Ben to remodel Carol's Home Store, using products from Delta Building Supplies. Halfway through the project, Four-Square refuses to finish the job. The contract can be enforced against Four-Square by

Ben and Carol's Home Store

Promise for a promise

Bilateral contract

Elements of a valid contract

Capacity, legal purpose, agreement, consideration

Statute of frauds

Certain contract that must be in writing

Does not allow one to conduct business for a certain period of time and in a certain geographical area

Covenant not to complete

T/F The court will always review the adequacy of the consideration

False

Offer that is irrevocable because it is supported by consideration

Firm offer / option contract

Refraining from an action you have a legal right to do

Forebearance

Donald Trump aka "The Donald" opens Trump University LLC. He makes a promotional video where he states "We're going to have professor that are absolutely terrific-terrific people, terrific rains, success, the best...All people that are hand-picked by me." The Donald intentionally does not pick any of the professors. 5,000 students sign up for this school. Each paid $35,000 in tuition. At the end of the classes did not believe that they really learned anything. Which of the following causes of action can each of the students bring a suit for ?

Fraudulent Misrepresentation

Its an illusion , terms are so uncertain it fails to bind the parties to a contract

Illusory contract

What is the general rule for minors purchasing an item

Minor may return an item at any time within a reasonable time of reaching an age of maturity

Requires the offeree's acceptance to match the offerors offer exactly

Mirror image rule

Intended beneficiary

One who at the commencement of the contract, the parties agree to make the contract for the third parties benefit

Contractual capacity

One who has mental capacity to enter a contract

Oral evidence that is not in the contract

Parole evidence

4 elements of certain and definite terms

Parties, subject manner, time and manner of performance, price

Two rules of a waiver

Plaintiff knew that plaintiff was required to fulfill the obligation and plaintiff freely and knowingly gave up that right

Elements to an offer

Present contractual intent, definite and reasonable terms

Extent of compensation that they deserve under a contract

Quantum meruit

It is based on the theory that an individual should not be allowed to profit or enrich themselves inequitably at the expense of the others

Quantum meruit

Fictional contract that courts can impose on the parties an equitable remedy

Quasi Contract

Forbearance

Refraining from an action that one has a legal right to undertake

3 ways to terminate an offer by acts of the parties

Revocation, counter offer, and rejection

What type of contract does ucc regulate

Sale of goods

Knowledge on the part of the of the misrepresenting party that facts have been falsely represented

Scienter

T/F Accord and satisfaction can be restated as a settlement and execution of a settlement agreement

True

T/F Contracts that are executory on both sides can be rescinded by agreement

True

T/F Performance can be accomplished by tender.

True

What document is the supreme law of the land

U.S. Constitution

Tender

Unconditional offer to perform who is ready, willing and able

Taking advantage of someone with dementia is an example of

Undue influence

What does UCC stand for

Uniform Commercial Code

accord and satiafaction is when

A debtor offers to pay and a creditor accepts a lesser amount than the creditor originally claimed was owed

Promissory estoppel

A person who detrimentally relied on the promise of another

Commercial impracticability ; can't be done, cost increase significantly

A reason for a party to be excused from their performance of a contract

What is an example of an illusory promise

Everyone gets an A if you work hard. Nothing definite and certain

A promise for the breach of which the law gives remedy

Contract

Novation

Contract between two people and they agree to trade one person for a third party

What does the UETA apply to a contract when the parties do what action

Each party agrees to conduct transactions by electronic means

A contract that has not been fully performed by both parties

Executory Contract

Murley was the Vice President of marketing at Hallmark Cards, Inc., until Hallmark eliminated her position as a part of corporate restriction. Murley and Hallmark entered into a separation agreement under which she agreed not to work in the greeting card industry for 18 months and not disclose or use any of Hallmark's confidential information. In exchange Hallmark gave Murley a $735,000 severance payment. After 18 months, Murley took a job with Recycled Paper Greetings (RPG) for $125,000 and disclosed confidential Hallmark information to RPG. Hallmark sued for BREACH OF CONTRACT and won. They won $860,000 ( $735,000 and $125,000) Murley appealed, and Hallmark was then entitled to the severance pay only, $735,000.

Hallmark Cards, INC v. Murley

commercial impracticality

Increase in cost or difficulty of performance

Scienter

Intent . Knowledge on the part of the misrepresenting party that facts have been falsely represented

5 types of contracts that must be in writing

Interests in land, contract cannot be performed in one year, collateral contracts(anothers debts) , consideration of marriage, sale of goods at $500 or more

3 categories that involve capacity to enter into a contract

Intoxication, minor and mental incompetence

How would you classify an advertisement using contractual concepts

Invitation to negotiate

What is the result if a debtor writes payment in full on a check and they cash it

It creates an accord and satisfaction

disaffirmance

The legal avoidance of a contractual obligation.

Incidental beneficiary

Third party who benefits but was not on purpose when the contract was made

when a person has been determined to be mentally incompetent by a court of law, the contract will be

Void

In delegating a duty is the delegator reliable if the delegates does not perform

Yes

a transfer of contract rights to a third party

assignment

Dennis sells a motorcycle to Elton without disclosing that the odometer, which reads 10,000 miles, was disconnected 100,000 miles ago. Dennis is most likely liable for:

fraud

Four terms for an offer to have a "definite and reasonable' terms

parties, subject matter, time and manner of performance, price

3 ways to terminate an offer by action of the parties

rejection, revocation, counter offer

Exclupatory Clause

release a party from liability in the event of monetary or physical injury no matter who is at fault

If there is a bilateral mistake of a material fact, either party may . . .

request for the contact to be rescinded

Building Restoration, Inc. (BRI), enters into a contract to refurbish an old train depot for Casual Dining, Inc., to open as Eat Up Restaurant. If BRI completes most of the work promised in the contract, its performance will be

substantial

Dix agrees to sell Eli, for $1,500, a remote parcel of land. All parties believe the land to be worthless, but unbeknownst to either party, beneath the land is shale rock containing oil. A court would

​not rescind the contract

​Contractors LLC agrees to build a store for Discount Retail, Inc., at a specific location. Before construction begins, the local zoning law is changed to prohibit commercial buildings at that location. In this situation

​the contract is discharged