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VIRGINIA COMMONWEALTH UNIVERSITY / Business Law / BLAW 323 / If a contract is for the sale of goods, the part of the ucc that gover

If a contract is for the sale of goods, the part of the ucc that gover

If a contract is for the sale of goods, the part of the ucc that gover

Description

School: Virginia Commonwealth University
Department: Business Law
Course: Legal Environment of Business
Professor: Kenneth hardt
Term: Fall 2016
Tags:
Cost: 50
Name: Exam 2 Study Guide
Description: This study guide contains vocabulary and study questions for the BUSN 323 exam 2 that will be covering chapters 13,14,15,16,17,18,19,20,33, and 34
Uploaded: 03/01/2018
16 Pages 119 Views 5 Unlocks
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Exam 2 Study Guide


If a contract is for sale of good, the part of the ucc that governs the contract is what?



Wednesday, March 14, 2018 6:54 PM

Chapter 13:

Acceptance: A key factor in the agreement element of a contract; consists of the  agreement of one party, the offeree, to the terms of the offer in the contract made by  the other party, the offeror.

Agreement: One of the four elements necessary for a contract; consists of an offer  made by one party, the offeror, and the acceptance of the offer by another party, the  offeree.

Bilateral Contract: A promise exchanged for a promise

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

Contract: A promise or set of promises for the breach of which the law gives a remedy  or the performance of which the law in some way recognizes a duty Contractual Capacity: The legal ability to enter into a binding agreement Covenant not to Compete: An agreement not to compete against a party for a set  period of time within a designated geographic area


Under the mailbox rule, acceptance is valid when?



Executed: A term applied to a contract whose terms have all been fully performed Executory: A term applied to a contract whose terms have not all been fully  performed If you want to learn more check out What does a synthesizer do?

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

Formal Contracts: A contract that must have a special form or must be created in a  specific manner

Implied Contracts: A contract that arises not from words of agreement but from the  conduct of the parties

Informal Contract: A contract that requires no formalities. Also called simple contract Lack of Genuine Assent: A defense to the agreement of a contract in which the  offeree claims that the offeror secured the agreement through improper means, such  as duress, fraud, undue influence, or misrepresentation


A severable contract is also known as a what?



Letter of Credit: A binding document that a buyer obtains from his or her bank to  guarantee that payment for goods will be made to the seller

Negotiable Instruments: A written document signed by a person who makes an  unconditional promise to pay a specific sum of money on demand or at a certain time  to the holder of the instrument; an acceptable medium for exchanging value from one  person to another

                 guarantee that payment for goods will be made to the seller

Negotiable Instruments: A written document signed by a person who makes an  unconditional promise to pay a specific sum of money on demand or at a certain time  to the holder of the instrument; an acceptable medium for exchanging value from one  person to another We also discuss several other topics like What are the three basic categories of political science and comparative politics?
If you want to learn more check out What are the types of customer buying behavior?

Offer: A key factor in the agreement element of a contract; consists of the terms and  conditions set by one party, the offeror, and presented to another party, the offeree Plain-Meaning Rule: A rule of interpretation which states that words in a contract  should be given their ordinary meaning

Quasi-Contracts: A court-imposed contractual obligation to prevent unjust  enrichment

Recognizance: An obligation in which a party acknowledges in court that he or she will  perform some specified act and/or pay a price on failure to do so

Simple Contract: A contract that is not a formal contract. Also called an informal  contract

Unenforceable: A term applied to a contract that, because of a law, cannot be  enforced by the courts

Uniform Commercial Code: A statutory source of contract law in the United States  that is applicable to transactions involving the sale of goods. The UCC was created in  1952 and adopted by all 50 states, the District of Columbia, and the Virgin Islands; it  may be modified by each state to reflect the wishes of the state legislature Unilateral Contract: A promise exchanged for an act

Valid: A term applied to a contract that includes all four elements of a contract— agreement (offer and acceptance), consideration, contractual capacity, and legal  object—and thus is enforceable

Void: A term applied to a contract that is not valid because its object is illegal or it has  a defect that is so serious that it is not a contract Don't forget about the age old question of What are the titles of ada?

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

1.

If a contract is for sale of good, the part of the UCC that governs the contract is a. Article 1 of the common law governing sales Don't forget about the age old question of When was georgia farm bureau established?

b. The restatement of sales

c. Article 2, which governs contracts for the sale of goods 

d. Article 2A of the common law governing sales

2.

The two most important sources of contract law are ________ law and the  Uniform Commercial Code (UCC)

Case Law 

3.

Rob promised Rupert that he would paint the inside of his house for $5,000.  Rupert agrees to Rob's offer. If Rob fails to perform, a court could enforce the  promise or award damages to Rupert. The enforceable promises between Rob  and Rupert are known as a(n)

a. Tort

3.

Rob promised Rupert that he would paint the inside of his house for $5,000.  Rupert agrees to Rob's offer. If Rob fails to perform, a court could enforce the  promise or award damages to Rupert. The enforceable promises between Rob  and Rupert are known as a(n)

a. Tort

b. Constitutional issue

c. Quasi-contract

d. Contract 

4.

There are two defenses to the enforcement of a contract even if all of the  essential elements of a contract are present. They are: If you want to learn more check out Anthropology is the study of what?

a. Lack of genuine assent and lack of proper form 

b. Lack of genuine assent and lack of consideration

c. Lack of proper form and lack of consideration

d. Lack of proper form and lack of acceptance

5.

The terms of _______ contracts are all clearly set forth in either written or  spoken terms

Express 

Chapter 14:

Acceptance: A key factor in the agreement element of a contract; consists of the  agreement of one party, the offeree, to the terms of the offer in the contract made by  the other party, the offeror.

Communication: In a contract, an offer made to the offeree or the offeree’s agent Counteroffer: An offer made by an offeree to the offeror that relates to the same  matter as the original offer but proposes a substituted bargain that differs from the  one proposed in the original offer

Definite and Certain Terms: The requirement, under common law, that a contract  must include and clearly define all material terms

Intent: The intended purpose or goal of an action, especially in a contract Mailbox Rule: A rule which holds that an acceptance is valid when it is placed in the  mailbox, whereas a revocation is effective only when received by the offeree. In some  jurisdictions the mailbox rule has been expanded to faxes

Material Terms: In a contract, the terms that allow a court to determine what the  damages are in the event that one of the parties breaches the contract; include the  subject matter, quantity, price, quality, and parties

Mirror-image Rule: A principle which holds that the terms of an acceptance must  mirror the terms of the offer. If the terms of the acceptance do not mirror the terms  of the offer, no contract is formed and the attempted acceptance is a counteroffer. 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 a  specified period of time

Rejection: Termination of a contract that occurs when an offeree does not accept the  offer or terms of the contract

o te oer, no contract is orme an te attempte acceptance is a counteroer. 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 a  specified period of time

Rejection: Termination of a contract that occurs when an offeree does not accept the  offer or terms of the contract

Revocation: Termination of a contract that occurs when an offeror takes back the  initial offer and annuls the opportunity for the offeree to accept the offer. Termination: In a contract, the point at which an offer can no longer be accepted as  part of a binding agreement or an offeree no longer has the power to form a legally  binding contract by accepting the offer; can occur through revocation by the offeror,  rejection by the offeree, death or incapacity of the offeror, destruction or subsequent  illegality of the subject matter of the offer, or lapse of time or failure of another  condition stated in the offer

1.

Under the mailbox rule, acceptance is valid

a. When the offeror acknowledges receipt of the acceptance

b. When it is received by the offeror

c. 10 days after it is mailed by the offeree

d. When it is mailed by the offeree 

2.

In a(n) ________ contract, the offeree gives consideration in return for the  offeror holding the offer open and not revoking for a specified period of time. Option 

3.

Under common law, what types of terms must be included in a valid contractual  offer?

a. Terms that will be left unresolved for future negotiation  

b.

Material terms, all major items necessary for mutual consent that are  clearly laid out 

c. Terms that are written only

d.

Open terms that the contract leaves vague for parties to see conditions  later

4.

What are methods by which termination of a contractual offer can occur? a. Offeror can send notice to the secretary of state's office b. Revocation by the offeror 

c.

Offeror refuses to spend the money that offeree gives as part of  acceptance and consideration

d. Counteroffer by the offeree 

5.

In a bilateral contract, which parties are giving promises as consideration for a  contract?

a. The court

b. Offeree 

c. 3rd party beneficiary

d. Offeror  

Chapter 15

 

a. The court

b. Offeree 

c. 3rd party beneficiary

d. Offeror  

Chapter 15

Accord and Satisfaction: An arrangement between contracting parties whereby one  of the parties substitutes a different performance for his or her original duty under  the contract. The promise to perform the new duty is the accord, and the actual  performance of that new duty is the satisfaction

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

Illusory Promise: A situation in which a party appears to commit to something but  really has not committed to anything. It is not a promise and thus not consideration Liquidated Debt: Debt for which there is no dispute between the parties about the  fact that money is owed and the amount of money owed

Preexisting Duty: A promise to do something that one is already obligated to do. It is  not considered valid consideration.

Promissory Estoppel: The legal enforcement of an otherwise unenforceable contract  due to a party’s detrimental reliance on the contract.

Unliquidated Debt: A debt for which the parties either dispute the fact that any  money is owed or agree that some money is owed but dispute the amount

1.

Anna promises Sam that she will cleam Sam's house and Sam promises Anna  she will pay Anna $100 when Anna is done. Which of the following is true? a. Anna and Sam's promises are an exchange of something of value b. Anna and Sam have formed a bilateral contract 

c. There is no contract because there is no consideration

d. Anna's promise in exchange for Sam's promise is sufficient consideration 2.

Wanda works for Humongous Co. Part of her job, for which she was hired 10  years ago, is to prepare a monthly report of all transactions in her department.  After 10 years, Wanda tells Humongous that she wants another $500 a month  to prepare the reports. Which of the following is true?

a. Humongous must pay Wanda the $500 a month

b.

Wanda is using undue influence to gain a $500 a month benefit she is not  entitled to receive

c. Wanda has an existing contractual duty to prepare the report d. $500 a month is sufficient consideration

3.

Which of the following is true about a partial payment of a liquidated debt? a. The debt remains outstanding 

b. Liquidated debt is a product of fraud

c. The rest of the debt is forgiven if the partial payment is accepted d. If more than 50% of the debt is paid, the debt if fully paid

4. Ever contract must be suorted b the element of

3.

Which of the following is true about a partial payment of a liquidated debt? a. The debt remains outstanding 

b. Liquidated debt is a product of fraud

c. The rest of the debt is forgiven if the partial payment is accepted d. If more than 50% of the debt is paid, the debt if fully paid

4. Every contract must be supported by the element of

a. Return on investment

b. Money

c. Forbearance

d. Consideration 

5. For a(n) _________ debt, if the debtor offers to pay less money than is owed as  full payment and the creditor agrees, there is not an accord, and even if the  debtor pays the money agreed to, the creditor may nevertheless sue for the  balance it believes is owed.

liquidated 

Chapter 16

Adhesion Contract: A contract created by a party to an agreement that is presented  to the other party on a take-it-or-leave-it basis. Such contracts are legal but are  sometimes rescinded on the grounds of unconscionability and the absence of one  party’s free will to enter a contract

Capacity: The legal ability to enter into a binding contract

Covenants not to Compete: An agreement not to compete against a party for a set  period of time within a designated geographic area

Exculpatory Clause: A clause in a contract that basically frees one party (usually the  drafter of the agreement) from all liability arising out of performance of the contract;  generally based on factors such as consumer ignorance or a great deal of unexplained  fine print that serve to deprive the less powerful party of a meaningful choice Gambling: Agreements in which parties pay consideration (money placed during bets)  for the chance, or opportunity, to obtain an amount of money or property In Pari Delicto: In equal fault.

Indivisible Contract: A contract that cannot be divided and must be performed in its  entirety

Procedural Unconscionability: Unconscionability that derives from the process of  making a contract

Sabbath Laws: A law that prohibits the performance of certain activities on Sundays Severable Contracts: A contract whose terms can be divided

Substantive Unconscionability: Unconscionability that derives from contract terms  that are so one-sided, unjust, or overly harsh that the contract should not be enforced Unconscionable: A term applied to a contract in which one party has so much more  bargaining power than the other party that the powerful party dictates the terms of  the agreement and eliminates the other party’s free will.

everae onracs:  conrac wose erms can e ve

Substantive Unconscionability: Unconscionability that derives from contract terms  that are so one-sided, unjust, or overly harsh that the contract should not be enforced Unconscionable: A term applied to a contract in which one party has so much more  bargaining power than the other party that the powerful party dictates the terms of  the agreement and eliminates the other party’s free will.

Usury: The lending of money at an exorbitant or unlawful rate of interest

1. An indivisible contract requires ________ performance by both parties, even if  it appears to contain multiple parts

a. Limited

b. Partial

c. Conditional  

d. Complete 

2. Adhesion contracts are

a. Legal 

b. Per se inequitable

c. Per se illegal

d. Equitable

3. _______ unconscionability occurs when an agreement is overly harsh or  lopsided

Substantive 

4. An exculpatory clause releases one of the contracting parties from all liability a. Assuming neither of the parties was at fault

b. Assuming the other party was at fault

c. Regardless of who is at fault 

d. Assuming both contracting parties were equally at fault

5. A severable contract is also known as a(n) _______ contract

a. Divisive

b. Divisible 

c. Derogatory

d. Derisive  

Chapter 17:  

Concealment: The active hiding of the truth about a material fact Duress: Any unlawful act or threat exercised on a person whereby the person is  forced to enter into an agreement or to perform some other act against his or her will. Fraudulent Misrepresentation: (1) The tort that occurs when a misrepresentation is  made with intent to facilitate personal gain and with the knowledge that it is false. (2)  In contracts, a false representation of a material fact that is consciously false and is  intended to mislead the other party. Also called intentional misrepresentation Innocent Misrepresentation: A false statement made about a material fact by a  person who believed the statement was true

            made with intent to facilitate personal gain and with the knowledge that it is false. (2)  In contracts, a false representation of a material fact that is consciously false and is  intended to mislead the other party. Also called intentional misrepresentation Innocent Misrepresentation: A false statement made about a material fact by a  person who believed the statement was true

Legal Assent: A promise to buy or sell that the courts will require that the parties obey Misrepresentation: An untruthful assertion by one of the parties about a material fact Mistake of Fact: (1) A mistake that is not caused by the neglect of a legal duty by the  person committing the mistake but, rather, consists of unconscious ignorance of a  past or present material event or circumstance. (2) An affirmative defense in which  the defendant tries to prove that she or he made an honest and reasonable mistake  that negates the guilty-mind element of a crime

Mutual: The result of an error by both parties about a material fact, i.e., one that is  important in the context of a particular contract

Negligent Misrepresentation: A false statement of material fact made by a person  who thinks it is true but who would have known the truth about the fact had he or she  used reasonable care to discover or reveal it

Nondisclosure: The failure to provide pertinent information about a projected  contract

Rescinded: To cancel a contract

Scienter: Deliberately or knowingly

Undue Influence: The situation in which one person takes advantage of his or her  dominant position in a relationship to unfairly persuade the other person and  interfere with that person’s ability to make his or her own decision Unilateral: A mistake that is the result of an error by one party about a material fact,  that is, a fact that is important in the context of the particular contract. Voidable: A term applied to a contract that one or both parties have the ability to  either withdraw from or enforce

1. A promise that the courts will require the parties to obey is known as a. Rescission

b. Revocation

c. Legal assent 

d. A voidable contract

2. A contract that is voidable can be ________, where the person cancelling the  contract is required to return everything she gave the other party and return  anything the other party gave to her.

Rescinded 

3. Marya had contracted with a tree service to remove a large, dead tree from her  yard and to have the resulting debris removed from her property. When the  workers arrived, they informed Marya that they would not do the work unless  she signed another contract which required a higher amount of money to be  paid to the workers. The action of the workers is known as

a. Duress

3. Marya had contracted with a tree service to remove a large, dead tree from her  yard and to have the resulting debris removed from her property. When the  workers arrived, they informed Marya that they would not do the work unless  she signed another contract which required a higher amount of money to be  paid to the workers. The action of the workers is known as

a. Duress 

b. Innocent misrepresentation

c. Fraudulent misrepresentation

d. Unconscionability  

4. An untruthful assertion by one of the parties about a material fact of the  contract is

a. A mistake

b. Misrepresentation 

c. Ground for enforcing the contract

d. A meeting of the minds  

5. The parties to a contract typically have a particular understanding as to the  good or service they are giving or receiving. If one or both parties are under the  wrong impression of that good or service, we say that a(n)

a. Consent has occurred

b. Assent has occurred

c. Consideration has occurred

d. Mistake has occured 

Chapter 18

Admission: A statement made in court, under oath, or at some stage during a legal  proceeding, in which a party against whom charges have been brought admits that an  oral contract existed, even though the contract was required to be in writing Condition Precedent: In a contract, an event that must occur in order for a party’s  duty to arise.

Equal Dignity Rule: A rule requiring that contracts that would normally fall under the  statute of frauds and need a writing if negotiated by the principal must be in writing  even if negotiated by an agent

Integrated Contract: A written contract intended to be the complete and final  representation of the parties’ agreement

Merger Clause: A clause in a written agreement within the statute of frauds which  states that the written agreement accurately reflects the final, complete version of  the agreement

Parol Evidence Rule: A common law rule which states that oral evidence of an  agreement made prior to or contemporaneously with a written agreement is  inadmissible when the parties intend to have the written agreement be the complete  and final version of their agreement

Partial Performance: An exception to the statute of frauds in which the performance  of portions of an unwritten agreement by one or both parties can constitute proof

               agreement made prior to or contemporaneously with a written agreement is  inadmissible when the parties intend to have the written agreement be the complete  and final version of their agreement

Partial Performance: An exception to the statute of frauds in which the performance  of portions of an unwritten agreement by one or both parties can constitute proof  that an oral contract exists between the parties

Prenuptial Agreement: An agreement two parties enter into before marriage that  clearly states the ownership rights each party enjoys in the other party’s property. To  be enforceable, it must be in writing

Statute of Frauds: State-level legislation that addresses the enforceability of contracts  that fail to meet the requirements set forth in the statute; serves to protect promisors  from poorly considered oral contracts by requiring that certain contracts be in writing.

1. In order to meet the requirements of the statue of frauds, a document needs a. Some form of mark as long as it was meant as a signature 

b. The partial signature of both parties to the agreement

c. No signature of mark

d. A notarized signature

2. The statute of frauds is found in what federal code?

a. Chapter 13 of the U.S. code

b. Chapter 11 of the U.S. code

c. It is not found in any federal code, but rather is encompassed in state  statues and state common law 

d. Chapter 7 of the U.S. code

3. The required elements of a written agreement under the statute of frauds are  _______ of parties, subject matter of the agreement, consideration, and any  pertinent terms.

Identification 

4. What are circumstances where the statute of frauds is applied to an  agreement?

a. Contracts for the sale of goods for a value of over $500 

b. Contracts that cannot be completed in one year 

c. Contracts for the elimination of primary debt or obligations

d. Marriage contracts based off of mutual promises to marry

5. Mutual promises to marry do not require a contract in __________ writing 

Chapter 19

Assignee: In a contract, the party who receives the rights of another party (an  assignor) to collect what was contractually agreed on in the original contract Assignment: (1) A contracting party’s (an assignor’s) transfer of his or her rights to the  contract to a third party (an assignee). (2) A transfer of a tenant’s entire interest in a

Assignee: In a contract, the party who receives the rights of another party (an  assignor) to collect what was contractually agreed on in the original contract Assignment: (1) A contracting party’s (an assignor’s) transfer of his or her rights to the  contract to a third party (an assignee). (2) A transfer of a tenant’s entire interest in a  leased property

Assignor: In a contract, the party who transfers his or her rights to a contract to a  third party (an assignee), giving the assignee the right to collect what was  contractually agreed on in the original contract

Creditor Beneficiary: A third party who benefits from a contract in which the promisor  agrees to pay the promisee’s debt.

Delegatee: A third party who is not part of the original contract but to whom duties to  perform are transferred by one of the contracting parties (a delegator) Delegation: A contracting party’s (a delegator’s) transfer of his or her duty to perform  to a third party who is not part of the original contract (a delegatee) Delegator: A party in a contract who transfers his or her duties to perform to a third  party who is not a part of the original contract (a delegatee)

Donee Beneficiaries: A third party who benefits from a contract in which a promisor  agrees to give a gift to the third party.

English Rule: A rule which states that the first assignee to give notice of assignment to  the obligor is the party with rights to the contract

First-assignment-in-time rule: A rule which states that the first party granted an  assignment is the party correctly entitled to the contractual right

Incidental Beneficiary: One who unintentionally gains a benefit from a contract  between other parties

Intended Beneficiary: A third party to a contract whom the contracting parties  intended to benefit directly from their contact

Obligees: A contractual party who agrees to receive something from the other party Obligors: A contractual party who agrees to do something for the other party Promisee: In a third-party beneficiary contract, the party to the contract who owes  something to the promisor in exchange for the promise made to the third-party  beneficiary

Promisor: In a third-party beneficiary contract, the party to the contract who made  the promise that benefits the third party

Third-party Beneficiary: A recipient of contractual benefits who is not one of the  contracting parties; created when two parties enter into a contract with the intended  purpose of benefiting a third party

Vest: To mature, as in the maturing of rights such that a party can legally act on the  rights

1. Which of the following is true?

a. After making an assignment, the assignor still has rights in the original  contract

b. After delegating performance, the delegator has no more liability under

rights

1. Which of the following is true?

a. After making an assignment, the assignor still has rights in the original  contract

b. After delegating performance, the delegator has no more liability under  the original contract

c. After delegating performance, the delegator remains liable under the  original contract if the delegatee fails to perform 

d. After making an assignment, the assignor has no right left to the original  contract 

2. An obligor is best defined as the party in a contract that

a. Has agreed to receive something from the other party

b. Has agreed to perform something for the other party 

c. Is obliged to register the contract with the courts

d. Transferred his or her interest in the contract to a third party 3. Meg hires Chris to paint her daughter Catherine's bedroom. Which of the  following is true?

a. Catherine has no rights under the contract between Meg and Chris b. Catherine is an intended third party beneficiary 

c. If Chris does not paint the room, Catherine can enforce the contract d. If Chris does not paint the room, only Meg can enforce the contract 4. Albus has a contract to mow Severus's lawn once a week for $50 a week. Albus's  business is so busy that he hires Draco to mow Severus's lawn. Which of the  following is true?

a. Albus must mow Severus's lawn because Draco was not part of the  original contract

b. It is invalid to transfer a contractual duty

c. Albus delegated his duty to mow Severus's lawn to Draco 

d. Albus must mow the front lawn and Draco must mow the back lawn 5. The most common form of donee beneficiary contract is ______ ______  policies.

Life insurance 

Chapter 20

Compensatory Damages: Money awarded to a plaintiff as reimbursement for her or  his losses; based on the amount of actual damage or harm to property, lost wages or  profits, pain and suffering, medical expenses, disability, etc

Complete Performance: Contract performance that occurs when all aspects of the  parties’ duties under the contract are carried out perfectly.

Concurrent Conditions: In a contract, terms under which each party’s performance is  conditioned on the performance of the other; occur only when the parties are  required to perform for each other simultaneously

Condition Precedent: In a contract, an event that must occur in order for a party’s

            parties’ duties under the contract are carried out perfectly.

Concurrent Conditions: In a contract, terms under which each party’s performance is  conditioned on the performance of the other; occur only when the parties are  required to perform for each other simultaneously

Condition Precedent: In a contract, an event that must occur in order for a party’s  duty to arise

Condition Subsequent: In a contract, a future event that terminates the obligations of  the parties when it occurs

Conditional Contracts: A contract that becomes enforceable only on the happening or  termination of a specified condition

Consequential Damages: In a contract, foreseeable damages that result from special  facts and circumstances arising outside the contract itself. The damages must be  within the contemplation of the parties at the time the breach occurs. Also  called special damages

Express Conditions: A condition specifically and explicitly stated in a contract and  usually preceded by words such as conditioned on, if, provided that, or when Implied Conditions: A condition that is not specifically and explicitly stated but is  inferred from the nature and language of the contract

Injunction: A court order either forcing a party to do something or prohibiting a party  from doing something

Liquidated Damages: Damages specified as a term of the contract before a breach of  contract occurs

Material Breach: A substantial breach of a significant term or terms of a contract that  excuses the nonbreaching party from further performance under the contract and  gives the nonbreaching party the right to recover damages

Monetary Damages: Money claimed by or ordered paid to a party to compensate for  injury or loss caused by the wrong of the opposite party

Nominal Damages: Monetary damages awarded to a plaintiff in a very small amount,  typically $1 to $5, to signify that the plaintiff has been wronged by the defendant even  though the plaintiff suffered no compensable harm

Novation: In a contract, the substitution of a third party for one of the original parties.  The duties remain the same under the contract, but one original party is discharged  and the third party takes that original party’s place

Objective Impossibility: In a contract, a situation in which it is in fact not possible to  lawfully carry out one’s contractual obligations

Punitive Damages: Compensation awarded to a plaintiff that goes beyond  reimbursement for actual losses and is imposed to punish the defendant and deter  such conduct in the future. Also called exemplary damages

Rescission: The termination of a contract

Restitution: The return of any property given up under a contract

Specific Performance: An order of the court requiring that a nonbreaching party fulfill  the terms of the contract.

Subjective Impossibility: In a contract, a situation in which it would be very difficult  for a art to carr out his or her contractual obliations.

Rescission: The termination of a contract

Restitution: The return of any property given up under a contract Specific Performance: An order of the court requiring that a nonbreaching party fulfill  the terms of the contract.

Subjective Impossibility: In a contract, a situation in which it would be very difficult  for a party to carry out his or her contractual obligations.

Substantial Performance: Contract performance that occurs when nearly all the terms  of the agreement have been met, there has been an honest effort to complete all the  terms, and there has been no willful departure from the terms of the agreement. Tender: An offer by a contracting party to perform, along with being ready, willing,  and able to perform, a duty outlined in the contract

1. If the breach is a minor one, it may entitle the non-breaching party to ______,  but it does not _______ the non-breaching party from the contract Damages, discharge 

2. What constitutes the return of any property given up under the contract? a. Ramification

b. Rescission

c. Restitution 

d. Reformation

3. Through ______, parties discharge their duty by making an offer to perform and  being ready, willing, and able to perform

a. Presentment

b. Tender 

c. Proffer

d. Tinder

4. _________ damages are said to compensate a plaintiff for his or her loss of the  benefit of a contract.

Compensatory  

5. A condition _______ is a future event that terminates the obligations of the  parties when it occurs

a. Decedent

b. Precedent

c. Antecedent

d. subsequent 

Chapter 33

Agency: The fiduciary relationship that arises when one person consents to have  another act on his behalf and subject to his control and the other consents to do so Agency Relationship: The association between one party and an agent who acts on  behalf of that part

Apparent Agency: An agency relationship created by operation of law when one  party, by her actions, causes a third party to believe someone is her agent even

gency: e ucary reaonsp a arses wen one person consens o ave  another act on his behalf and subject to his control and the other consents to do so Agency Relationship: The association between one party and an agent who acts on  behalf of that part

Apparent Agency: An agency relationship created by operation of law when one  party, by her actions, causes a third party to believe someone is her agent even  though that person actually has no authority to act as her agent. Also called agency by  estoppel

Constructive Trust: (1) An implied trust in which a party is named to hold the trust for  its rightful owner. (2) An equitable trust imposed on someone who wrongfully obtains  or holds legal right to property he or she should not possess

Duty of Loyalty: An agent’s obligation to act in the interest of the principal Duty of Notification: An agent’s obligation to inform the principal of the agent’s  actions on the principal’s behalf and of all relevant information.

Duty to Compensate: A principal’s obligation to pay an agent for his or her services. Expressed Agency: An agency created in a written or oral agreement. Also  called agency by agreement

1. Gabriel sent Arthur on a trip to San Diego to hunt down some antique furniture  that Gabriel was going to sell. Arthur had paid for his own ticket. Is Gabriel  required to pay Arthur for his expenses on the trip?

a. No, because even though the trip was for business purposes, all travel  expenses are to be paid by the agent

b. Yes, because Arthur is Gabriel's agent and as such, he is entitled to  reimbursement 

c. No, because Gabriel is not required to pay anyone for travel expenses d. Yes, because Arthur is Gabriel's agent and as such, he is entitled to  rescission  

2. Courts suggest that the most important duty that an agent owes to a principal is  the duty of _________

Loyalty  

Chapter 34

Actual Notice: Notice of agency termination that is given by directly informing third  parties, either orally or in writing

Agency coupled with an interest: An agency relationship that is created for the  benefit of the agent, not the principal

Constructive Notice: Notice of agency termination that is usually given by publishing  an announcement in a newspaper

Disclosed Principal: A principal whose identity is known to a third party. The third  party is aware that the agent is making an agreement on behalf of the principal. Durable Power of Attorney: A document which specifies that an agent’s authority is  intended to continue beyond the principal’s incapacitation

General Power of Attorney: A type of express authority that allows an agent to

     

Disclosed Principal: A principal whose identity is known to a third party. The third  party is aware that the agent is making an agreement on behalf of the principal. Durable Power of Attorney: A document which specifies that an agent’s authority is  intended to continue beyond the principal’s incapacitation

General Power of Attorney: A type of express authority that allows an agent to  conduct all business for the principal

Partially Disclosed Principal: A principal whose identity is not known by a third party,  although the third party is aware that the agent is making an agreement on behalf of a  principal. Also called unidentified principal.

Power of Attorney: A specific type of express authority that grants an agent specific  powers

Respondeat Superior: Latin for “let the superior speak”; the principle by which liability  for harm caused by an agent/employee is held by the principal/employer Special Power of Attorney: A type of express authority that allows an agent to act on  behalf of the principal only in regard to specifically outlined acts.

Undisclosed Principal: A principal whose existence is not known by a third party. That  is, the third party does not know that an agent is acting on behalf of a principal Vicarious Liability: The liability or responsibility imposed on a person, a party, or an  organization for damages caused by another; most commonly used in relation to  employment, with the employer held vicariously liable for the damages caused by its  employees

1. If an agent has no ______ to act on behalf of a principal, but enters into a  contract with a third party, then the principal will not be bound or liable for that  agreement

Authority 

2. If a new law is passed that makes an agency relationship illegal, what happens  to the agreement?

a. The agency agreement is terminated 

b. It becomes an agency coupled with an interest

c. The agency agreement is fine as long as it does not need to be modified d. The agreement is fine if the parties notify the Secretary of the State

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