AIC 301 Expanding Your Claims Perspective Exam UPDATED QUESTIONS AND CORRECT ANSWERS

AIC 301 Expanding Your Claims
Perspective Exam UPDATED QUESTIONS
AND CORRECT ANSWERS
Contract - CORRECT ANSWER a legally enforceable agreement between two or more parties



Promisor - CORRECT ANSWER The party to a contract making a promise.



Promisee - CORRECT ANSWER The party to a contract to whom a promise is made.



Privity of contract - CORRECT ANSWER The relationship that exists between the parties to a
contract



Third-party beneficiary - CORRECT 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 - CORRECT ANSWER The failure, without legal excuse, to fulfill a
contractual promise



Offeror - CORRECT ANSWER The party to a contract who promises to give something in
return for a promise or an act by another party



Offeree - CORRECT ANSWER The party to a contract who makes a promise or acts in return
for something offered by another party



Uniform Commercial Code (UCC) - CORRECT ANSWER A code of federal laws that govern
commercial transactions in the United States



A model code that has been adopted in whole or in part by each state and whose purpose is to provide
a consistent legal basis for business transactions throughout the United States and its territories

,Bilateral contract - CORRECT ANSWER A contract in which each party promises a
performance



Unilateral contract - CORRECT ANSWER A contract in which only one party makes a
promise or undertakes the requested performance



Executed contract - CORRECT ANSWER A contract that has been completely performed by
both parties



Executory contract - CORRECT ANSWER A contract that has not been completely performed
by one or both of the parties



Express contract - CORRECT ANSWER A contract whose terms and conditions are explicitly
stated



Implied contract - CORRECT ANSWER A contract whose terms and intentions are indicated
by the actions of the parties to the contract and the surrounding circumstances



Implied-in-fact contract - CORRECT ANSWER A contract that is not express but that the
parties presumably intended, either by tacit understanding or by the assumption that it existed



Implied-in-law contract - CORRECT 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



Voidable contract - CORRECT ANSWER A contract that one of the parties can reject (avoid)
based on some circumstance surrounding its execution.



Void contract - CORRECT ANSWER An agreement that, despite the parties' intentions, never
reaches contract status and is therefore not legally enforceable or binding.



Mutual assent - CORRECT ANSWER The act of two or more parties coming together to agree
to the terms of a contract.

, Fraud - CORRECT ANSWER An intentional misrepresentation resulting in harm to a person
or organization



Representation - CORRECT ANSWER A statement of alleged fact



Material fact - CORRECT ANSWER A fact that is significant to a decision or matter at hand



Rescission - CORRECT ANSWER A legal act of canceling something (like a contract) and
making it void



Unilateral mistake - CORRECT ANSWER A perception by one party to a contract that does
not agree with the facts



Bilateral mistake - CORRECT ANSWER A perception by both parties to a contract that does
not agree with the facts.



Duress - CORRECT ANSWER The use of restraint, violence, threats of violence, or wrongful
pressure to compel a party to act contrary to his or her wishes or interests



Undue influence - CORRECT ANSWER The improper use of power or trust to deprive a
person of free will and substitute another's objective, resulting in lack of genuine assent to a contract



Parol evidence rule - CORRECT ANSWER A provision that prevents the terms of a contract
from being modified by evidence of oral or other agreements after the contract has been written



Statute of frauds - CORRECT ANSWER A law to prevent fraud and perjury by requiring that
certain contracts be in writing and contain the signature of the party responsible for performing that
contract.



Real property (realty) - CORRECT ANSWER Tangible property consisting of land, all
structures permanently attached to the land, and whatever is growing on the land.



Assignment - CORRECT ANSWER The transfer of rights or property