Action at Law

·        Initiate lawsuit - file complaint

·        Parties - π & Δ

·        Decision - by jury or judge

·        Result - judgment

·        Remedy - monetary damages

Action in Equity

·        Initiate lawsuit - file petition

·        Parties - petitioner & respondent

·        Decision - judge (no jury)

·        Result - decree

·        Remedy - injunction, specific performance, or rescission

What is an express contract?

Terms of agreement are fully and explicitly stated in words, oral or written

Does an express contract have to be written?

No it does not!

Is a bid made on a construction contract an offer?

YES!

Can consideration consist of not doing something?

Yes

If there’s been a court order, adjudicating a party as mentally incompetent can he enter into any kind of contract?

NO

Can you avoid a contract based upon mutual mistake of material fact?

When a bilateral mistake occurs, the contract can be rescinded or cancelled by either party.

Can you avoid a contract based upon a unilateral mistake of material fact?

The general rule is that a unilateral mistake does not afford the mistaken party relief from the contract.

Are there any exceptions to the rule requiring the collateral promise to be in writing?

A promise to answer for the debt of another is covered by the statute of frauds UNLESS the guarantor’s main purpose in incurring the secondary obligation is to secure a personal benefit. The assumption is that a court can infer from the circumstance of a particular case whether the “leading objective” of the promisor was to secure a benefit.

What is a condition precedent?

A condition in a contract which calls for the happening of some event, or performance of some act, before the agreement become binding on the parties.

Is a failure to perform 1 minor promise made in a contract a breach of contract?

YES

How do you measure the damages arising from breach of a contract for sale of land?

the measure of damages is ordinarily the same as in contracts for the sale of goods- that is the difference between the contract price and the market price of the land.

Can you enforce a contract for a sale of goods if there is no set price in the contract?

NO

Do you have to have additional consideration to modify a contract under Article 2?

Is a president of the corporation an agent of the corporation?

YES

Can you have an independent contractor who is an agent?

YES

Can a minor act as an agent?

YES

Who ratifies an agent’s contract?

Principal

What is the significance of a disclosed, partially disclosed, v. undisclosed principal? (liability of the agents principal)

Level of Liability of Agent

What is substantive law?

Substantive - all laws that define, describe, regulate, and create legal rights and obligations

What is the objective theory of mutual assent (contracts)?

What is the pre-existing duty rule?

a legal duty which is already owed does not constitute consideration,

What is the mirror image rule about?

he mirror image rule states that an offer must be accepted exactly without modifications. The offeror is the master of his own offer. An attempt to accept the offer on different terms instead creates a counter-offer, and this constitutes a rejection of the original offer.

What is the UCC’s response to the mirror image rule?

under the Uniform Commercial Code (UCC Section 2-207). In such situations, an acceptance that does not match the terms of the offer is nonetheless effective as long as the material terms are agreed upon.

When can a minor disaffirm a contract?

at any time during minority or for a reasonable period after reaching majority

How does a minor go about disaffirming a contract?

Minor must express intent (express or implied) not to be bound

What is a condition subsequent?

A condition referring to a future event upon the happening of which the contract becomes no longer binding on the parties

What is past consideration?

NO consideration

What is compensatory damages?

Damages compensating the non breaching party for the loss of bargain are known as compensatory damages. These damages compensate the injured party only for damages actually sustained and proved to have arisen directly from the loss of the bargain caused by the breach of contract.

 consequential damages

Foreseeable damages that result from a party’s breach of contract are called consequential damages, or special damages.

They differ from compensatory damages in that they are caused by special circumstances beyond the contract itself.

They flow from the consequences, or results, of a breach.

Who is a merchant?

"Merchant" means a person who deals in goods of the kind or otherwise by his occupation holds himself out as having knowledge or skill peculiar to the practices or goods involved in the transaction or to whom such knowledge or skill may be attributed by his employment of an agent or broker or other intermediary who by his occupation holds himself out as having such knowledge or skill.

What is apparent authority?

If the principal's words or conduct would lead a reasonable person in the third party’s position to believe that the agent was authorized to act, say by appointing the agent to a position which carries with it agency-like powers, those who know of the appointment are entitled to assume that there is apparent authority to do the things ordinarily entrusted to one occupying such a position

Four type of Business Models

1. Sole Proprietor

2.  Parntership

3.  Limited Parntership

4. Corporations

Sole Proprietor

The sole proprietorship is the oldest, most common, and simplest form of business organization. A sole proprietorship is a business entity owned and managed by one person. The sole proprietorship can be organized very informally, is not subject to much federal or state regulation, and is relatively simple to manage and control.

Partnership

A partnership is a type of business entity in which partners (owners) share with each other the profits or losses of the business undertaking in which all have invested. Partnerships are often favored over corporations for taxation purposes, as the partnership structure does not generally incur a tax on profits before it is distributed to the partners and reported to IRS on an information form.

Limited Partnership

A limited partnership is a form of partnership similar to a general partnership, except that in addition to one or more general partners (GPs), there are one or more limited partners (LPs). It is a partnership in which only one partner is required to be a general partner.

As with a general partnership, "An act of a general partner which is not apparently for carrying on in the ordinary course the limited partnership's activities or activities of the kind carried on by the limited partnership binds the limited partnership only if the act was actually authorized by all the other partners."

Corporation

Despite not being natural persons, corporations are recognized by the law to have rights and responsibilities like actual people.