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.
Six elements of a contract
Six Elements of a Contract Nikki Sinatra Crockett Period 3
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.http://www.youtube.com/watch?v=Gx8H4Ad 8j8o
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
Genuine Agreement Genuine agreement- offer and acceptance go together to create a final agreement.
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 TypesPossibility of performance- Contract cannot be performed.Subject matter- Either party can void contract.
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.
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.
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.
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 somethingPromise 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
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.
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.