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Business Law 2.01
elements and characteristics of a contract
| Term | Definition |
|---|---|
| Acceptance | Unqualified willingness by the offeree to go along with the offer |
| Benefits | Something that a party was not previously entitled to receive |
| Bilateral | Contains two promises |
| Capacity | legal ability to enter into a contract |
| Consideration | exchange of benefits and detriments by the parties to an agreements |
| Counteroffer | any change in the terms of the offer |
| Death | offeror dies |
| Detriments | Any loss suffered; anything given up |
| Duress | Overcoming a person’s free will by use of force or by threat of force or bodily harm |
| Economic Duress | Threats to a person’s business or income |
| Emancipation | severing of the parent-child relationship |
| Express | Contract statement that may be written or oral |
| Firm Offer | a written offer for goods that states the period of time during which the offer will stay open |
| Forbearance | not doing something that you have the right to do |
| Fraudulent Misrepresentation | Party to a contract deliberately makes an untrue statement of fact |
| Genuine Agreement (Assent) | A valid offer has been made by the offeror, and a valid acceptance has been exercised by the offeree |
| Illusory Promises | Clause or wording that allows party to escape from legal obligation |
| Implied | Contract that comes about from the actions of the parties |
| Insanity | offeror is declared insane |
| Legality | the quality of state of being in accordance with the law |
| Mentally Incapacitated | Lacking the ability to understand the consequences of his or her contractual acts |
| Mirror Image Rule | Terms of the acceptance must match exactly (mirror) the terms of the offer |
| Mutual Mistake (Bilateral Mistake) | both parties are mistaken about an important fact |
| Nominal Consideration | Token amount in a written contract where either the parties cannot or do not wish to state the amount |
| Offer | Proposal by one party to another with intent to create a legal binding agreement |
| Offeree | offer made to this person |
| Offeror | makes the offer |
| Option | the offeree gives the offeror something of value in return for a promise to keep the offer open for a set period of time |
| Oral | Created by two or more people speaking to each other |
| Past Performance | An act that has already been performed cannot be consideration in a contract. |
| Price Fixing | competitors agree on certain price ranges within which they will sell their products |
| Rejection | refusal by the offeree |
| Restrictive covenant | agreement not to compete in a region for a period of time |
| Revocation | taking back of an offer by offeror |
| Statute of Frauds | Requires that certain contracts be in writing to be enforceable |
| Unconscionable | So grossly unfair or oppressive that it would shock the conscience of the court |
| Undue Influence | unfair and improper persuasive pressure within a relationship of trust |
| Unenforceable contract | Contract that court will not uphold, usually because of some rule of law |
| Unilateral | Contains a promise by only one person to do something if, and when, the other party performs a certain act |
| Unilateral Mistake | an error on the part of one of the parties |
| Usury | State sets a max interest rate |
| Valid contract | Includes all elements recognized by the courts |
| Void contract | Without legal effect |
| Voidable contract | One or more parties can get out of contract for some legal reason |
| Written | contract terms are written so that both parties know the exact terms |
Created by:
alaynac
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