BUL 4421 QUESTIONS AND ANSWERS LATEST
UPDATE (ALREADY GRADED A+).
Contract
A promise or set of legally enforceable promises for the breach of which the law gives a remedy or the
performance of which the law in some way recognizes a duty.
Agreement:
consists of an offer by one party, called the offeror, to enter into a contract and an acceptance of the
terms of the offer by the party called the offeree
Consideration
the bargained- for exchange or what each party gets in exchange for his or her promise under the
contract. Can take on the form of; goods, money, services, or legal detriment
Contractual capacity
the legal ability to enter into a binding agreement. Another element of an enforceable contract
-Most adults over the age of majority have capacity; those under the age of majority, people suffering
from mental illness, and sufficiently intoxicated persons do not.
-Minimum cognitive activity is required in order for a natural person to understand and appreciate the
nature and consequences of their contractual obligations and benefits
Objective theory of contracts
we base the existence of a contract on the parties' outward manifestations of intent, and we base its
interpretation on how reasonable person would interpret it
• The subjective intent of parties is not usually relevant; what matters is how they represented their
intent through their actions and words.
Bilateral contract
a promise in exchange for a promise. • As soon as the promises exchanged, a contract is formed, and
the parties' legal obligations arise
Unilateral contract
requires performance in order to forma a contract (a promise + a requested action)
• The offeror wants the offeree to do something, not promise to do something. Think lost dog for
reward sign
• Only performance by the offeree constitutes a valid acceptance
Expressed contract
the terms of the contract are all clearly set forth in either written or spoken words
, Implied contract
arise not from words but from the conduct of parties
Void contract
not a contract at all. Either its object is illegal, or it has some defect so serious it is not a contract
Voidable contract
one or both of the parties has the ability to either withdraw from the contract or enforce it
Option contract
the offeree gives the offeror consideration in exchange for holding the offer open for a specified period
of time.
Cannot be rescinded/ revoked.
Revocation
the offeror can revoke the offer at any time unless the offeree entered an option contract with the
offeror. ________ is effective when the offeree receives it.
Rejection
another way to terminate the offer, effectuated by the offeree. Regardless of how long the offer was
stated to be open, once the offeree rejects it, it is terminated.
Counteroffer
an offer made by an offeree to his offeror relating to the same matter as the original and proposing a
substituted bargain differing from that proposed in the original offer.
• Terminates original offer
Destruction or subsequent illegality of the subject matter
if the subject matter of the offer is destroyed or becomes illegal, the offer is immediately terminated.
Lapse of time
if the offer states it will be held open for only a certain time, it terminates when that time expires.
• In the absence of such a time condition, the offer will expire after the lapse of a reasonable amount of
time
Authorized means of acceptance
if the offer specifies that acceptance must be communicated by a specific mode, that mode is the only
means for accepting the offer
• If no mode of communication is specified in the offer, any reasonable means of acceptance is valid.
Consideration
what a legal entity receives in return for performing a contract obligation
UPDATE (ALREADY GRADED A+).
Contract
A promise or set of legally enforceable promises for the breach of which the law gives a remedy or the
performance of which the law in some way recognizes a duty.
Agreement:
consists of an offer by one party, called the offeror, to enter into a contract and an acceptance of the
terms of the offer by the party called the offeree
Consideration
the bargained- for exchange or what each party gets in exchange for his or her promise under the
contract. Can take on the form of; goods, money, services, or legal detriment
Contractual capacity
the legal ability to enter into a binding agreement. Another element of an enforceable contract
-Most adults over the age of majority have capacity; those under the age of majority, people suffering
from mental illness, and sufficiently intoxicated persons do not.
-Minimum cognitive activity is required in order for a natural person to understand and appreciate the
nature and consequences of their contractual obligations and benefits
Objective theory of contracts
we base the existence of a contract on the parties' outward manifestations of intent, and we base its
interpretation on how reasonable person would interpret it
• The subjective intent of parties is not usually relevant; what matters is how they represented their
intent through their actions and words.
Bilateral contract
a promise in exchange for a promise. • As soon as the promises exchanged, a contract is formed, and
the parties' legal obligations arise
Unilateral contract
requires performance in order to forma a contract (a promise + a requested action)
• The offeror wants the offeree to do something, not promise to do something. Think lost dog for
reward sign
• Only performance by the offeree constitutes a valid acceptance
Expressed contract
the terms of the contract are all clearly set forth in either written or spoken words
, Implied contract
arise not from words but from the conduct of parties
Void contract
not a contract at all. Either its object is illegal, or it has some defect so serious it is not a contract
Voidable contract
one or both of the parties has the ability to either withdraw from the contract or enforce it
Option contract
the offeree gives the offeror consideration in exchange for holding the offer open for a specified period
of time.
Cannot be rescinded/ revoked.
Revocation
the offeror can revoke the offer at any time unless the offeree entered an option contract with the
offeror. ________ is effective when the offeree receives it.
Rejection
another way to terminate the offer, effectuated by the offeree. Regardless of how long the offer was
stated to be open, once the offeree rejects it, it is terminated.
Counteroffer
an offer made by an offeree to his offeror relating to the same matter as the original and proposing a
substituted bargain differing from that proposed in the original offer.
• Terminates original offer
Destruction or subsequent illegality of the subject matter
if the subject matter of the offer is destroyed or becomes illegal, the offer is immediately terminated.
Lapse of time
if the offer states it will be held open for only a certain time, it terminates when that time expires.
• In the absence of such a time condition, the offer will expire after the lapse of a reasonable amount of
time
Authorized means of acceptance
if the offer specifies that acceptance must be communicated by a specific mode, that mode is the only
means for accepting the offer
• If no mode of communication is specified in the offer, any reasonable means of acceptance is valid.
Consideration
what a legal entity receives in return for performing a contract obligation
