10/23/24, 1:04 Exam 2 Study
PM Guide
8FIL 185, The Legal, Ethical & Social Environment of Business
Dr. Katrin C. Varner
Exam 2 Study Guide
Exam 2 will be held on Tuesday, 10 November.
Anything we have covered in class since Exam 1 is fair game (Contracts, Torts, and Property),
but this study guide should provide you with some hints as to what I think are the most important
topics. Please feel free to e-mail or call with any questions you may have regarding this study
guide or the exam itself.
Vocabulary Words:
Uniform Commercial Code Fraud Duress
Contract Mitigation Specific Performance
Consideration Restitution Tort
Detriment Strict Liability Battery
Statute of Frauds Assault False Imprisonment
Liquidated Damages Negligence Accession
Contributory Negligence Bailment Easement
Comparative Negligence Zoning Eminent Domain
Constructive Eviction Slander Defamation
Libel
You should understand the following:
1. Most contracts are express, meaning that both sides have agreed to the terms, but some
contracts are implied, meaning that the parties have never openly discussed terms and may
not even know they’re parties to a contract. What are the different types of implied
contracts?
Implied in fact contract: The terms are never openly discussed, but the actions of the parties
indicate the existence of an agreement. EX: every Saturday you mow neighbors lawn
Quasi Contract: The existence of a contract is inferred by the court for reasons of fairness
2. What are the 4 elements of a valid contract?
• Mutual agreement
• Consideration
• Legality of object
• Capacity of the parties
about:blan 1/
k 6
, 10/23/24, 1:04 Exam 2 Study
PM Guide
3. What do we look for to see whether there is valid consideration for a contract?
• Was there a bargained for exchange?
• Do both parties have a benefit and detriment
• Is the consideration adequate?
o Is what’s exchanged equal/similar value
o Most courts don’t care. But IL do
4. When and why does the Statute of Frauds apply to contracts, requiring them to be in
writing? WHEN
• Sale of goods over $500.00
• Contracts not performable within one year
• Sale of land
• Contracts to answer for the debt of another (suretyship agreement)
• Prenuptial agreement
WHY
• Prevent the threat of fraud or perjury
• Can help eliminate or minimize misunderstandings about the contract
• Protects us against faulty memories
• Emphasizes significance of contract
5. Sometimes all the elements of a contract are present, but courts won’t hold a party liable
under the contract for some other reason. These reasons are called Contract Defenses. What
are the Contract Defenses that we talked about in class?
• Fraud- misrepresentation of a material fact made with knowledge of the falsity of the
statement with intent to cause another to act which in fact causes another to acct to
his detriment or injury
• Mistake- A perception that is at variance with the facts
• Duress- An improper threat that is sufficiently grave that it leads the victim with
no reasonable alternative but to enter into the contract
• Under Influence- unfair persuasion of a party based on a relationship of trust and/or
domination
• Unconscionability- no official definition
6. Not all contract disputes are solved by payment of money damages. What are some
equitable remedies available in contract cases?
• Specific performance- courts order parties to comply with terms of contract
o Goods that are unique
o Sale of land
• Injunction- court order requiring someone to stop doing something
o Non-compete agreement: you will not work for a competitor while in current
job or for certain amount of time after leaving employer
about:blan 2/
k 6
PM Guide
8FIL 185, The Legal, Ethical & Social Environment of Business
Dr. Katrin C. Varner
Exam 2 Study Guide
Exam 2 will be held on Tuesday, 10 November.
Anything we have covered in class since Exam 1 is fair game (Contracts, Torts, and Property),
but this study guide should provide you with some hints as to what I think are the most important
topics. Please feel free to e-mail or call with any questions you may have regarding this study
guide or the exam itself.
Vocabulary Words:
Uniform Commercial Code Fraud Duress
Contract Mitigation Specific Performance
Consideration Restitution Tort
Detriment Strict Liability Battery
Statute of Frauds Assault False Imprisonment
Liquidated Damages Negligence Accession
Contributory Negligence Bailment Easement
Comparative Negligence Zoning Eminent Domain
Constructive Eviction Slander Defamation
Libel
You should understand the following:
1. Most contracts are express, meaning that both sides have agreed to the terms, but some
contracts are implied, meaning that the parties have never openly discussed terms and may
not even know they’re parties to a contract. What are the different types of implied
contracts?
Implied in fact contract: The terms are never openly discussed, but the actions of the parties
indicate the existence of an agreement. EX: every Saturday you mow neighbors lawn
Quasi Contract: The existence of a contract is inferred by the court for reasons of fairness
2. What are the 4 elements of a valid contract?
• Mutual agreement
• Consideration
• Legality of object
• Capacity of the parties
about:blan 1/
k 6
, 10/23/24, 1:04 Exam 2 Study
PM Guide
3. What do we look for to see whether there is valid consideration for a contract?
• Was there a bargained for exchange?
• Do both parties have a benefit and detriment
• Is the consideration adequate?
o Is what’s exchanged equal/similar value
o Most courts don’t care. But IL do
4. When and why does the Statute of Frauds apply to contracts, requiring them to be in
writing? WHEN
• Sale of goods over $500.00
• Contracts not performable within one year
• Sale of land
• Contracts to answer for the debt of another (suretyship agreement)
• Prenuptial agreement
WHY
• Prevent the threat of fraud or perjury
• Can help eliminate or minimize misunderstandings about the contract
• Protects us against faulty memories
• Emphasizes significance of contract
5. Sometimes all the elements of a contract are present, but courts won’t hold a party liable
under the contract for some other reason. These reasons are called Contract Defenses. What
are the Contract Defenses that we talked about in class?
• Fraud- misrepresentation of a material fact made with knowledge of the falsity of the
statement with intent to cause another to act which in fact causes another to acct to
his detriment or injury
• Mistake- A perception that is at variance with the facts
• Duress- An improper threat that is sufficiently grave that it leads the victim with
no reasonable alternative but to enter into the contract
• Under Influence- unfair persuasion of a party based on a relationship of trust and/or
domination
• Unconscionability- no official definition
6. Not all contract disputes are solved by payment of money damages. What are some
equitable remedies available in contract cases?
• Specific performance- courts order parties to comply with terms of contract
o Goods that are unique
o Sale of land
• Injunction- court order requiring someone to stop doing something
o Non-compete agreement: you will not work for a competitor while in current
job or for certain amount of time after leaving employer
about:blan 2/
k 6
