BLAW Exam 2 Study Guide
BLAW Exam 2 Study Guide BLAW
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This 4 page Study Guide was uploaded by Alex Lazo on Saturday March 26, 2016. The Study Guide belongs to BLAW at University of Texas at Dallas taught by Matthew Polze in Summer 2015. Since its upload, it has received 45 views. For similar materials see Business and Public Law in Business Law at University of Texas at Dallas.
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Date Created: 03/26/16
Exam 2 Study Guide Chapter 11: Contracts Contract consists of seven parts: 1. Offer 2. Acceptance 3. Consideration 4. Legality 5. Capacity 6. Consent 7. Writing Types of contracts: o Bilateral- promise for promise o Unilateral- promise for performance o Executory- obligations unfulfilled o Executed- obligations fulfilled o Voidable- law permits one party to terminate agreement o Void agreement- neither party can enforce because act is illegal o Express- parties state all terms o Implied- words and conduct indicate agreement Promissory Estoppel 1. Defendant made promise 2. Plaintiff relied on promise 3. Must enforce promise to avoid injustice Quasi-contract 1. Plaintiff gave benefit to defendant 2. Plaintiff reasonably expected to be paid and defendant knew this 3. Defendant unjustly enriched and must pay Chapter 12: Offers and Acceptances Do the offeror’s words and actions indicate intention to make bargain? Are the terms reasonably definite? Don’t constitute offers: o Invitations to bargain, price quotes, letter of intent, advertisement, auctions Termination of offers o Must be taken back before the offeree accepts o Option contract: offeror may not revoke contract during set time Acceptance: must say or do something to accept o Mirror image rule: acceptance must be on precisely same terms as offer o Acceptance generally effective once out of offeree’s control Chapter 13: Consideration Promise that causes person to enter into contract and forms basis for parties’ exchange o Act: do something not legally required to do o Forbearance: agree not to do something not legally required to do Not consideration: illusory promise, preexisting duty o Exceptions include additional work, unforeseen circumstances, and modification Settlements of debt o Liquidated: no dispute about amount If creditor takes less than full amount as full payment, agreement is not binding o Unliquidated: debt that is diluted because the parties disagree over its existence or amount Parties may settle for less than what creditor demands Accord and satisfaction: agreement to settle for less and the payment for that sum Chapter 14: Legality Contracts that Violate a Statute o Wagers: gambling contract illegal unless specifically authorized by state statute o Insurance: anyone taking out a policy on another must have insurable interest in that person’s life o Licensing statutes: contract with unlicensed worker is unenforceable when licensing agreement is designed to protect the public o Usury: prohibit charging excess interest on loans Contracts that Violate Public Policy o Non-compete agreements: agreement not to compete must be ancillary to legitimate bargain Exculpatory clauses: attempt to release one party from liability in the event the other is injured Unconscionable contracts: courts refuse to enforce because of fundamental unfairness Chapter 15: Voidable Contracts Capacity: legal ability of party to enter into contract o Rescind=cancel o Party suffering mental impairment usually creates only voidable contracts Reality of Consent o To establish fraud, injured party must show 1. Intentional or reckless misrepresentation of fact 2. Materiality 3. Justifiable reliance Unilateral mistake: when one party enters contract under mistaken assumption Mutual mistake: both contracting parties share same mistake Duress: an improper threat made to force another party to enter into contract Undue influence: injured party must prove 1. Relationship between 2 parties of either trust or domination 2. Improper persuasion by stronger party Chapter 16: Contracts That Must Be in Writing Parol Evidence: anything said, done, or written before parties signed the agreement Integrated contract: writing that parties intended as the final, complete expression of their agreement Agreements for interest in land must be in writing to be enforceable Agreements that cannot be performed within one year o Unenforceable unless in writing o If it could possibly be completed, it need not be in writing o If will necessarily take longer than one year, it must be in writing Promise to pay debt of another must be in writing Chapter 17: Third Parties Assignment=transferring rights Delegation=transferring duties Rights assigned unless: substantial change, public policy, contract prohibition o Assigned by writing, consideration, and notice to obligor Rights of parties after assignment o Assignee may enforce contractual rights o Obligor may raise defenses against assignee that they could raise against assignor Obligor may delegate duties unless: o Delegation would violate public policy o Contract prohibits delegation o Obligee has substantial interest in personal performance by obligor Novation: three-way agreement in which the obligor transfers all rights and duties to a third party Chapter 18: Performance, Breach, and Discharge Conditions: must occur before party becomes obligated under contract o Concurrent=satisfaction occurs simultaneously o Precedent=before duty arises o Subsequent=occurs after duty arises Performance o Strict: requires one party to perform obligations precisely with no deviation from the contract terms o Substantial: party fulfills enough of contract obligations to warrant payment o Personal satisfaction contract Subjective standard if assessing the work involves personal feelings, taste, or judgement o Time of essence clause generally make dates strictly enforceable Breach: when one party breaches contract, other party is discharged o Material: substantially harms innocent party o Anticipatory: one party makes it unmistakably clear they will not honor the contract Impossibility o True impossibility; something has made it literally impossible to do what the promisor said he would do o Commercial impracticality: some event occurred that neither party could anticipate and fulfilling the contract would now be extraordinarily difficult o Frustration of purpose: some event occurred that neither party anticipated and the contract has no value for one party
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