Ch. 7 How Contracts Arise
What is the first element to a contract?
AN OFFER!
what is a deliberate deception to secure an unfair gain?
Fraud
what is the legal ability to enter into a contract?
CAPACITY
what is the willingness to go along with the offer?
acceptance
What is the unfair and improper persuasive pressure by one person in a relationship of trust with another person? The stronger person exerts inspiration on the weaker, older, person
Undue Influence
Infancy
An offer has 3 basic requirements, what are they? Each correct answer is 100 points
1. Serious Intent
2. Definiteness and Certainty
3. Communication to the Offeree
Give the definition of Innocent Misrepresentation
when a person makes what they believe to be a true statement but is actually false.
ex: I sell a bike to Morgan, and I truly think it's in great shape, no issues. Morgan gets home and sees it has a flat tire. I really had no idea it had a flat tire, it was an innocent mistake
What are the other types of PEOPLE who may avoid contracts (each worth 100 points)
1. Mentally impaired people
2. Intoxicated people
3. Other capacity such as convicts or aliens
What are the 4 categories that contracts fall into when they have certain characteristics? each right answer is worth 100 points!
1. Valid, Void, Voidable, Unenforceable Contracts
2. Expressed or Implied Contracts
3. Bilateral or Unilateral Contracts
4. Oral or Written Contracts
Under a Mistake, you have a Unilateral Mistake (an error on one of the parties) and a Bilateral Mistake (an error by both the parties)
Under each of the above, there are 2 types of Unilateral Mistakes, and 2 Bilateral Mistakes. What are they?
1. Nature of the Agreement (you can't speak English and the entire contract is in English. it is on YOU to get a translator!)
2. Mistake as to the identity of a Party (you mail the contract to the wrong Matt Smith)
Bilateral:
1. Mistake to the possibility of performance (Logan agrees to by a car from Hunter. The night before it gets totaled and can't be repaired)
2. Mistake as to the Subject Matter (you agree to buy land on Prospect Hill from Tayler, but come to find out the land is actually on Prospect ROAD)
True or false: a minor is held liable to pay for their fair value of necessaries.
TRUE
list the 5 ways you can terminate an offer (each one correct is 100 points!)
1. Revocation (taking back the offer by the offeror)
2. Rejection (refusing the offer)
3. Expiration of time (if there is a time limit on the offer, it may not be accepted after a certain time)
4. Counteroffer (counteroffer ENDS the first offer and creates a new one)
5. Death or Insanity (if the offeror dies or becomes insane PRIOR to the acceptance)
list the 6 ways a contract can become VOID
1. Mistake
2. Fraud
3. Misrepresentation
4. Duress
5. Economic Duress
6. Undue Influence
if a minor claims to be over the age of majority, then they have committed what?
fraud
To succeed in a lawsuit for fraud, the person bringing the lawsuit must prove all 5 elements, what are they?
1. there must be a false representation of fact
2. the party making the representation KNOWS IT'S FALSE
3. the false representation must be made with the intent that the person will rely on it
4. the innocent party must rely on the false representation
5. innocent party must SUFFER some monetary loss