HFT 3603 EXAM 2 QUESTIONS WITH VERIFIED
ANSWERS
An agreement between two or more parties that creates obligations enforceable in court
- Answers - contract
Failure to perform, without legal excuse, some contracted act - Answers - breach of
contract
Breach of contract is a ______ wrong? - Answers - civil
What damages does the non-breaching party receive? - Answers - 1. Compensatory
damages
2. Specific performance
Non-breaching party who gets compensatory damages is called what? - Answers -
"benefit of the bargain"
How can a contract be created? - Answers - a contract can be written or oral
Enforceable in court - Answers - valid
Elements of a valid contract - Answers - - contractual capacity
- mutuality
- legality
- proper form
- genuine assent
The legal and mental ability to understand the terms of a contract and to understand
that failure to perform its terms can lead to legal liability (contract) - Answers -
contractual capacity
A contract that can be enforced
-it is valid, but may be legally voided at the option of one of the parties - Answers -
voidable contract
Contract that is unenforceable - Answers - void contract
Groups of people that are viewed by the law as having diminished mental abilities and
lacking in contractual capacity. All these contracts are considered voidable. - Answers -
- those under the age of 18 (in some states)
- the mentally incompetent
, - intoxicated
- the right to cancel
- applies while the disability exists and for a reasonable time after it ends
- example: after an intoxicated person becomes sober - Answers - Avoid or disaffirm
"meeting of the minds"
(has to be an offer AND acceptance)
-all parties to the contract are interested in the terms of a contract and intend to enter an
agreement to which they would be legally bound
(contract) - Answers - mutuality
Statement made by offeree to the offeror relating to the same matter as the original offer
and proposing a substituted bargain differing from that proposed by the original offer -
Answers - counteroffer
One thing of value for exchange of something else in value (contract) - Answers -
consideration
Three forms of consideration - Answers - 1. A tangible item of value or a promise to give
such an item
2. Performance or a promise to perform
3. Forbearance
Refraining from doing something you have the legal right to do - Answers - forbearance
A contractual term that fails to contain a firm commitment; a promise that is so indefinite
that the party making it has not in fact committed to do anything - Answers - illusory
Certain contracts must be in writing - Answers - statute of frauds
Types of contracts within the Statute of Frauds - Answers - - contracts for the purchase
and sale of real property: includes land and buildings and easements
- contracts that cannot be completed within one year from when they are made
- contracts to pay another person's debt if that person fails to pay
-contracts for the sale of goods in excess of $500
An exception to the writing requirement of the Statute of Frauds - Answers - Doctrine of
Part Performance
The privilege of using someone else's land for some limited purpose - Answers -
easement
Parole is _____? - Answers - oral or spoken
ANSWERS
An agreement between two or more parties that creates obligations enforceable in court
- Answers - contract
Failure to perform, without legal excuse, some contracted act - Answers - breach of
contract
Breach of contract is a ______ wrong? - Answers - civil
What damages does the non-breaching party receive? - Answers - 1. Compensatory
damages
2. Specific performance
Non-breaching party who gets compensatory damages is called what? - Answers -
"benefit of the bargain"
How can a contract be created? - Answers - a contract can be written or oral
Enforceable in court - Answers - valid
Elements of a valid contract - Answers - - contractual capacity
- mutuality
- legality
- proper form
- genuine assent
The legal and mental ability to understand the terms of a contract and to understand
that failure to perform its terms can lead to legal liability (contract) - Answers -
contractual capacity
A contract that can be enforced
-it is valid, but may be legally voided at the option of one of the parties - Answers -
voidable contract
Contract that is unenforceable - Answers - void contract
Groups of people that are viewed by the law as having diminished mental abilities and
lacking in contractual capacity. All these contracts are considered voidable. - Answers -
- those under the age of 18 (in some states)
- the mentally incompetent
, - intoxicated
- the right to cancel
- applies while the disability exists and for a reasonable time after it ends
- example: after an intoxicated person becomes sober - Answers - Avoid or disaffirm
"meeting of the minds"
(has to be an offer AND acceptance)
-all parties to the contract are interested in the terms of a contract and intend to enter an
agreement to which they would be legally bound
(contract) - Answers - mutuality
Statement made by offeree to the offeror relating to the same matter as the original offer
and proposing a substituted bargain differing from that proposed by the original offer -
Answers - counteroffer
One thing of value for exchange of something else in value (contract) - Answers -
consideration
Three forms of consideration - Answers - 1. A tangible item of value or a promise to give
such an item
2. Performance or a promise to perform
3. Forbearance
Refraining from doing something you have the legal right to do - Answers - forbearance
A contractual term that fails to contain a firm commitment; a promise that is so indefinite
that the party making it has not in fact committed to do anything - Answers - illusory
Certain contracts must be in writing - Answers - statute of frauds
Types of contracts within the Statute of Frauds - Answers - - contracts for the purchase
and sale of real property: includes land and buildings and easements
- contracts that cannot be completed within one year from when they are made
- contracts to pay another person's debt if that person fails to pay
-contracts for the sale of goods in excess of $500
An exception to the writing requirement of the Statute of Frauds - Answers - Doctrine of
Part Performance
The privilege of using someone else's land for some limited purpose - Answers -
easement
Parole is _____? - Answers - oral or spoken
