AIC 301 Study Guide Exam Questions and Answers
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contract - ANSWER a legally enforceable agreement between 2 or more parties
agreements - ANSWER not all __________________ are legally binding contracts
1) agreement
2) capacity
3) mutual assent
4) consideration
5) legal purpose
6) form required by law - ANSWER 6 elements of a legally binding contract
promisor - ANSWER party making a promise
promisee - ANSWER party to whom a promise is made
privity of contract - ANSWER the relationship that exists between 2 parties to a contract
privity - ANSWER a party cannot sue for breach of contract without being in ______________ of
contract with the other party
third-party beneficiary - ANSWER a person who is not a party to a contract but who benefits
from it and has a legal right to enforce the contract if it is breached by either of the contracting
parties
,breach of contract - ANSWER the failure without legal excuse, to fulfill a contractual promise
agreement - ANSWER must include an offer and its acceptance
offeror - ANSWER party making the offer
offeree - ANSWER party who makes a promise or acts in return for something offered by
another party
definite - ANSWER offers must include _____________ terms and be communicated to and
received by the offeree
counteroffer - ANSWER if the offeree requests changes to conditions of the offer
mentally competent - ANSWER all parties must be ______________ _________________ for a
contract to be legally binding
mutual assent - ANSWER the act of 2 or more parties deliberately negotiating all terms to
achieve consensus
consideration - ANSWER something of value that is given in return for a promise
legal purpose - ANSWER a contract must serve a legal purpose to be legally enforceable
form required by law - ANSWER contracts must be in a proper, legally stipulated form to be
binding
,1) sale of real estate
2) agreements that can't be performed within 1 year
3) transactions > $500
4) agreements to pay a debt owed - ANSWER 4 examples of contracts that have to be in writing
bilateral contract - ANSWER a contract where each party promises to perform an act in
exchange for an act by the other party
unilateral contract - ANSWER a contract where one party promises to pay for the act of the
other party
executed contract - ANSWER contract where nothing more is required of either party to be
fulfilled
executory contract - ANSWER a contract that hasn't been fully executed
express contract - ANSWER contract where terms and intentions are clearly stated
implied contract - ANSWER contract where terms and intentions are indicated by the actions of
the parties to the contract and the surrounding circumstances
implied-in-fact contracts - ANSWER parties presumably intended, either by tacit understanding
or by the assumption that it already existed
implied-in-law contracts - ANSWER an obligation that is not an actual contract but that is
imposed by law because of the parties' conduct or some special relationship between them or
because one of them would otherwise be unjustly enriched
, implied-in-law contracts - ANSWER sometimes called "quasi-contracts"
voidable contract - ANSWER a contract that one of the parties can reject (avoid) based on some
circumstances regarding its execution
behavior - ANSWER the _______________ of one of the contracting parties can make a contract
voidable
void contract - ANSWER an agreement that despite that parties' intentions, never reaches
contract status and is therefore not legally enforceable or binding
void contact - ANSWER ex. agreement to commit a crime (what type of contract?)
1) fraud
2) mistake
3) duress
4) undue influence
5) innocent misrepresentation - ANSWER 5 factors lacking for mutual assent
fraud - ANSWER an intentional misrepresentation resulting in harm to a person or an
organization
1) rescission
2) sue for damages - ANSWER 2 remedies that can be sought if fraud is proven
rescission - ANSWER a legal act of cancelling something and making it void
(2025 GRADED A+) , Success Guaranteed , 100%
Verified
contract - ANSWER a legally enforceable agreement between 2 or more parties
agreements - ANSWER not all __________________ are legally binding contracts
1) agreement
2) capacity
3) mutual assent
4) consideration
5) legal purpose
6) form required by law - ANSWER 6 elements of a legally binding contract
promisor - ANSWER party making a promise
promisee - ANSWER party to whom a promise is made
privity of contract - ANSWER the relationship that exists between 2 parties to a contract
privity - ANSWER a party cannot sue for breach of contract without being in ______________ of
contract with the other party
third-party beneficiary - ANSWER a person who is not a party to a contract but who benefits
from it and has a legal right to enforce the contract if it is breached by either of the contracting
parties
,breach of contract - ANSWER the failure without legal excuse, to fulfill a contractual promise
agreement - ANSWER must include an offer and its acceptance
offeror - ANSWER party making the offer
offeree - ANSWER party who makes a promise or acts in return for something offered by
another party
definite - ANSWER offers must include _____________ terms and be communicated to and
received by the offeree
counteroffer - ANSWER if the offeree requests changes to conditions of the offer
mentally competent - ANSWER all parties must be ______________ _________________ for a
contract to be legally binding
mutual assent - ANSWER the act of 2 or more parties deliberately negotiating all terms to
achieve consensus
consideration - ANSWER something of value that is given in return for a promise
legal purpose - ANSWER a contract must serve a legal purpose to be legally enforceable
form required by law - ANSWER contracts must be in a proper, legally stipulated form to be
binding
,1) sale of real estate
2) agreements that can't be performed within 1 year
3) transactions > $500
4) agreements to pay a debt owed - ANSWER 4 examples of contracts that have to be in writing
bilateral contract - ANSWER a contract where each party promises to perform an act in
exchange for an act by the other party
unilateral contract - ANSWER a contract where one party promises to pay for the act of the
other party
executed contract - ANSWER contract where nothing more is required of either party to be
fulfilled
executory contract - ANSWER a contract that hasn't been fully executed
express contract - ANSWER contract where terms and intentions are clearly stated
implied contract - ANSWER contract where terms and intentions are indicated by the actions of
the parties to the contract and the surrounding circumstances
implied-in-fact contracts - ANSWER parties presumably intended, either by tacit understanding
or by the assumption that it already existed
implied-in-law contracts - ANSWER an obligation that is not an actual contract but that is
imposed by law because of the parties' conduct or some special relationship between them or
because one of them would otherwise be unjustly enriched
, implied-in-law contracts - ANSWER sometimes called "quasi-contracts"
voidable contract - ANSWER a contract that one of the parties can reject (avoid) based on some
circumstances regarding its execution
behavior - ANSWER the _______________ of one of the contracting parties can make a contract
voidable
void contract - ANSWER an agreement that despite that parties' intentions, never reaches
contract status and is therefore not legally enforceable or binding
void contact - ANSWER ex. agreement to commit a crime (what type of contract?)
1) fraud
2) mistake
3) duress
4) undue influence
5) innocent misrepresentation - ANSWER 5 factors lacking for mutual assent
fraud - ANSWER an intentional misrepresentation resulting in harm to a person or an
organization
1) rescission
2) sue for damages - ANSWER 2 remedies that can be sought if fraud is proven
rescission - ANSWER a legal act of cancelling something and making it void
