L201 Exam 2

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csmith11
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242602
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L201 Exam 2
Updated:
2013-10-24 09:47:39
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business review
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L201 exam review
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  1. What is risk?
    Uncertainty about possibility of loss or gain
  2. What are some risk management tools?
    Transfer, avoid, retain, reduce
  3. What is a contract?
    relationship in which one person promises to do something if another person does something or promises in return
  4. Three components of a contract
    offer, acceptance, consideration
  5. elements for an agreement to have full enforcement
    not illegal or unfair, product of voluntary and knowing consent, parties have legal ability to consent
  6. unilateral
    one party makes a promise
  7. bilateral
    both parties make a promise
  8. executed
    contract fully performed
  9. executory
    still being performed
  10. express
    contract is communicated in words (written or oral)
  11. implied
    contract created by conduct under certain circumstances
  12. valid
    full contract remedies available
  13. voidable
    can be canceled because one can't give consent
  14. void
    no remedy available
  15. unenforceable
    P can't enforce contract but can get money back
  16. promisorry estoppel
    clear promise, reliance on promise, promisor should have seen reliance, broken promise leads to injustice
  17. reliance
    taking an action or failing to because of a promise
  18. quasi-contract
    one person gives benefit, other accepts, under circumstances it is unfair to keep benefit without paying
  19. elements of an offer
    present intent on part of offeror, terms are reasonably definite, communication to the offeree
  20. advertisements
    treated as invitations to make an offer unless terms are specific, nothing needs to be negotiated, ad is for small # of people
  21. Revoke before acceptance
    death, destruction of subject matter, illegality, time expired, rejection, revocation by offeror
  22. when offers aren't revocable
    option contract, offer for unilateral and offeree has performed, offeree relies on promise to keep offer open
  23. elements of acceptance
    offeree inteds to accept, offeree accepts on offeror's terms, offeree communicates acceptance
  24. mailbox rule
    acceptances are defaultly effective when sent by authorized method
  25. authorized method
    method suggested or used by offeror or common in industry
  26. When is contract formed?
    • unilateral - offeree's performance of act is complete
    • bi-lateral - when offeree's promise is communicated to offeror
  27. elements of consideration
    (legal value) promisee gives promisor something of legal value or legal value was bargained for in exchange for promise
  28. not consideration
    illusory promise, pre-existing duty, past consideration
  29. elements of modifying terms
    mutual agreement is not enough, new consideration necessary
  30. obstacles to enforcement of a contract
    circumstances that prevent objective consent, illegality of unconscionability, failure to have writing when writing is required
  31. if a person chooses to rescind he must
    give notice promptly and act in a way consistent with rescind
  32. ratification
    termination of right to rescind occurs if delay or inconsistence
  33. elements of misrepresentation
    false statement of fact, fact is material to contract, person seeking to rescind relied on untruth, reliance was reasonable
  34. false statements of fact
    include concealing and nondisclosure
  35. disclosure required when
    relationship of rust, latent defect, changes make earlier statement false
  36. Fraud
    scienter - knowledge of falsity and intent to deceive
  37. effects of fraud
    contract voidable, constitutes tort, constitutes crime
  38. unconscionability
    absence of meaningful choice on part of one party together with terms are unreasonably favorable to other party
  39. how courts can deal with unconscionability
    reform unfair part, refuse to enforce unfair, or refuse to enforce whole contract
  40. procedural unconscionability
    unequal bargaining power, unequal commercial sophistication, fine print or misleading terms
  41. substantive unconscionability
    take away rights like exculpatory clauses or arbitration clause and unreasonable prices
  42. statue of frauds
    requires some contracts to be in writing
  43. MYLEGS
    marriage, year, land, executor's promise to pay debts of an estate personally, goods, suretyship
  44. year
    is the contract bilateral? is there a specific duration? can it be performed in a year? NO? written
  45. land
    applies to creation/transfer of real property, not to a contract to build on real property
  46. suretyship
    at least 3 parties, 2 contracts, collateral contract party promises to pay unless promisor does for economic benefit
  47. Memorandum
    indicates contract was made, signed by party to be charged in breach, need not be intended to be contract
  48. parol evidence rule
    contract in writing; evidence of promises made before or while a contract was being signed will not be allowed to alter, add to, or contradict.
  49. merger clause
    clause that states contract is complete
  50. forum selection clause
    pick the forum of the court
  51. arbirtration clause
    give up right to go to court, must use arbitration
  52. exculpatory clause
    give up right to sue for damages
  53. duty
    legal obligation due to a contract
  54. condition
    future uncertain event that will trigger or cancel a duty
  55. breach
    failure to perform
  56. excuse
    a justified nonperformance
  57. discharge
    end of duty to perform, full performance, excuse, breach, condition, waiver, agree to end
  58. remedy
    compensaition court gives (legal - money, equitable - action)
  59. express condition
    condition expressed through words
  60. implied in fact condition
    implied by the facts of the contract
  61. constructive condition
    imposed by law to provide an order for performance
  62. condition precedent
    creates duty
  63. condition subsequent
    terminates duty
  64. concurrent
    each person's performance conditioned on other
  65. strict performance
    perfect, applies when express condition or performance is easy, breach results in discharge and sue for breach
  66. substantial performance
    not express and hard, promisee can sue for breach but must perform minus cost of breach
  67. liquidated damages
    amount agreed in contract ahead of time
  68. compensatory damages
    loss in value, foreseeable consequential loss, foreseeable incidental loss
  69. restitution
    when P conferred benefit on D, D must pay reasonable value
  70. Uniform Commercial Code
    default body for sale of goods or hybrids where goods are prominant
  71. Offer in UCC
    terms don't have to be definite as long as parties intended to make contract and there's a reasonably certain basis for remedy
  72. offeror's right to revoke in UCC
    firm offer, offeror is merchant, writing and signed by merchant, offer assures it will be open
  73. acceptance in UCC
    terms of acceptance can be different, no mirror image rule
  74. Consideration in UCC
    no new consideration required by modification if made in good faith
  75. UCC statute of frauds
    sale of goods $500 or greater
  76. Defects
    manufacturing, warning, design
  77. express warranty
    guarantees goods quality represented by seller, statement of facts, description of goods, promise about goods, display of goods ANY seller can make
  78. implied warranty of merchantability
    guarantees goods will be fit for ordinary purposes of goods, made in every sale of merchant
  79. implied warranty of fitness for a particular purpose
    goods fit buyer's purpose if seller has reason to know buyer's purpose and buyer relies on seller's skills to select, ANY seller
  80. remeides of breach of warranty
    personal injury, property damage, direct economic loss (difference in value between product sold and warranted), consequential economic lost (loss occuring because of breach), incidental damages
  81. disclaimers
    get rid of warranties all together
  82. disclaimer of implied merchantability
    must mention merchantability and be conspicuous
  83. disclaimer of implied fitness
    writing and conspicuous

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