2. The Offer
Offer- A proposal by one party to another
to create a legal binding agreement.
Three elements;
Offer- The proposal to one person.
Offeror- Makes the offer with serious
intent.
Offeree- The person the offer is made to.
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3. Acceptance
Acceptance- Unqualified willingness to go
along with the offer.
Mirror Image Rule- An offer is accepted
exactly as is without an modifications
(changes).
5 ways to terminate;
Rejection by the offeree
Counter-offer by the offeree
Revocation by the offeror
Lapse of time
Death of the offeror or offeree
5. Genuine Agreement
Unilateral Mistake- Mistake one party makes.
2 Types;
Nature of agreement-Signing a contract you don’t
understand or have not read.
Identity of a party- Bound by contract with face to
face meetings.
Bilateral Mistake- Mistakes both parties make.
2 Types
Possibility of performance- Contract cannot be
performed.
Subject matter- Either party can void contract.
6. Genuine Agreement
Fraud- Wrongful or criminal deception intended to
result in financial or personal gain.
Innocent Misrepresentation- Make an innocent
statement of supposed fact that turns out to be false.
Duress- Overcoming a person’s will by use of force or
by threat of force or bodily harm.
Economic Duress is a threat to a persons business or
income.
Under Influence is an unfair persuasive pressure
within a relationship of trust.
7. Capacity
Capacity- Legal ability to enter a contract.
Minors can enter a contract but when they turn of
legal age (18) they can ratify the agreement.
Mentally Impaired- When declared insane, contract is
automatically voided.
Intoxicated- Not understanding the nature, purpose, or
effect of contract; voided.
Convicts & Aliens- Certain limitations.
8. Consideration
Consideration- The exchange of benefits and
detriments by the parties to a contact.
Benefit- Something a party receives in the agreement.
Detriment- Something a party gives up in the
agreement.
9. Consideration
Agreements Not enforceable;
Illusory- All parties are required to do something.
Future gifts &legacies- Promise to give a gift to
another person.
Past Consideration- Given or promised in the past that
somebody tries to use again in a new contract.
Preexisting Duties- An obligation a person already has
to do something
Promise to attend places- All contracts are
agreements, but not all agreements are contracts.
Enforceable without consideration;
-Promises under seal
-Debts ended by statute of limitations
-Enforced by promissory estoppels
10. Legality
Legality-The quality or state of being in accordance with the
law.
Six Statutes
Civil &Criminal- Agreement to commit a crime or tort.
Usury Statutes- State sets a max interest rate.
Interest- Fee the borrower pays to the lender for using
the money.
Usury- Charging too high for an interest rate.
11. Legality
Public Policies- A legal principle that holds that
nobody should be allowed to do something that harms
the public.
Unreasonably Restrain Trade- Protects the right to
make a living.
Not to Compete- Someone buys a business, that
person also buys the seller’s goodwill not to compete.
Price Fixing- Protect Competition.
Defeat Competitive Bidding- Offer to buy/sell goods at
a stated price.
Obstruct Justice- Contract in the way of dispensing of
justice is illegal.
Inducing Breach of Duty- Hold positions of trust and
have responsibility for the well-being of others.
Notas do Editor
Rejection- decline the offer. Counter-offer- not accepting the original offer but negotiating for a final contract. Revocation- canceling the contract. Lapse of time a period of time where the contract remains valid. Death- contract is void due to death.