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LGS exam 2 Review

by: Paget Kern

LGS exam 2 Review LGS 200

Paget Kern

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About this Document

As gone through in class, chapters 9, 10, and 11
Legal Studies Honors/ Legal Environment of Business
Mr. Brian Turner
Study Guide
LGS, Legal Studies, Legal Studies honors, 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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