LGS exam 2 Review
LGS exam 2 Review LGS 200
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This 4 page Study Guide was uploaded by Paget Kern on Wednesday March 2, 2016. The Study Guide belongs to LGS 200 at University of Alabama - Tuscaloosa taught by Mr. Brian Turner in Winter 2016. Since its upload, it has received 28 views. For similar materials see Legal Studies Honors/ Legal Environment of Business in Business at University of Alabama - Tuscaloosa.
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Date Created: 03/02/16
LGS EXAM 2 REVIEW Elements of a contract o Agreement o Consideration o Capacity o Legality Enforceable contract needs a meeting of the minds o Both parties need agreement or mutual assent Difference bilateral vs. unilateral contract o Bilateral: promise for promise Offeror makes offer to offeree who accepts/rejects o Unilateral: promise for performance Offeror makes offer to offeree who accepts by performing Capacity o Minor: voidable by minor o Intoxication: disaffirmance voidable o Mentally incompetent: void o Not officially declared by court as “mentally incompetent”: voidable Expressed vs. Implied o Expressed: everyone knows terms, oral o Implied in fact: Chance to reject but didn’t (ambulance) Executed and executory o E: everyone performed (end of 12 month lease) o E: one side performed or not fully performed (4 months into 12 month lease) Objective theory of contract o Reasonable person’s standard o Would a reasonable person believe that the parties were intended to be bound by the terms of the contract? Various ways o Revocation: offeror takes back offer o Rejection: offeree rejects offer o Irrevocable: offeror is held to their offer Common law contract o Mirror image rule: offeree has to accepted offer as given o If offeree makes a change and sends back to offeror, counter offer Offer can be terminated o Destroyed (house hit by tornado) If already bought, then financial burden is on offeror o Death (owner of house dies) If bought before death, follow through o Lapse of time (offer to buy house by Friday and now its Saturday) o Supervening legality (it is not illegal to buy the house, contract void) Mistake o Unilateral: one party mistakes. Bound by terms of contract o Bilateral: both parties mistake material fact… cancel or reformed o Value: mistaken of later market value, contract enforced Statute of frauds o Must be in writing to be enforceable o Real estate o Marriage: need witnesses o Collateral secondary: security or guaranty agreement in cause you breach o UCC $500: if over $500 must be in writing One year rule o If contract is over one year, then it must be in writing Article 2 and 2a: used in event of dispute or cap fillers o 2: Sale of Goods o 2a: Lease of goods Goods o Tangible and movable Trade secrets o Intellectual property o Not a good Title to the good passed from buyer to seller o After a sale o Transfer of ownership when buyer becomes rightful owner of subject matter Shipment contract vs. Destination o Shipment: ownership and ROL to buyer when good is shipped o Destination: ownership and ROL to buyer when good is delivered Warranty o Expressed: statement of fact of guarantee that goods meet a certain standard o Implied Merchantability: automatic for merchants… good purchased fits for ordinary purpose Fitness for particular purpose: everyone… buyer depends on merchant’s expertise to buy what they need Grandma gives you $1000 o Gift: lack of consideration, cannot sue o In exchange for her benefit: can sue… followed through with a promise for a promise, but she did not hold up her end Preexisting duties for consideration o Build a warehouse, has to follow contract o Cannot stop halfway through and demand more money o If unforeseeable difficulties, can demand compensation and adjust contract Assignment o Assign rights to third party, your rights under original contract are extinguished Intended vs. incidental beneficiaries o Intended: those specifically chosen to have cause of action Insurance company, if mom dies she chose her children to be beneficiaries Proceeds go to children, and only they can sue insurance company if needed o Incidental: those who benefit by association without cause of action Company hires app company to make app, app company hires new employees Employees are incidental beneficiaries… they benefit but have no cause of action Valid agreement o Both parties intend to be bound by the contract o Need intent, definite terms, and communication Condition precedent o An event that must occur before parties can perform o Example: When the truck comes, you will buy the inventory. If the truck can’t come, then you won’t pay Mistake of Value o Sell land that’s worthless but has a gold mine later, cannot resend the contract Most contracts are discharged by performance o Everyone performs completely o One party performs: contractor performs and builds building for $10K, owner is not entitled to anything more than he paid for, pays said amount Novation o X and Y in contract, but Y wants to give contract to his grandmother o X and Y terminate contract, X and grandmother enter contract o Termination and assignment hybrid Remedy of specific performance o Real estate: Unique item, like land, if agreed to sell, offeror has to perform because finding land exactly the same is impossible Lease situation o Lessor: owner of goods o Lessee: user and future possessor of goods Unilateral contract under UCC o Promise for act o Offeree has to communicate acceptance Partial Payment o Even if contract is oral, you must accept and perform partial payment Identification o Animals born within 12 months of contract, CONCIEVED Shipment vs Destination o Risk of loss shipment: ROL passes to buyer when goods are shipped o ROL destination: ROL passes to buyer when goods are delivered Fault contract o Shipment contract: by default, ownership passes to buyer when good is shipped. Buyer has to be notified when good is shipped and make a transportation contract with carrier Goods in existence o ID takes place as soon as it’s written into contract Open terms UCC o If not agreed upon or “silence”, the place of delivery will be the seller’s business Cure o You have until the date agreed upon in contract to perform Express warranty o Affirmation or statement of fact about a good’s quality, condition or performance UCC merchantability is automatic Puffery is not am expressed warranty
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