AIC 301 CERTIFICATION EXAM QUESTIONS WITH CORRECT ANSWERS

AIC 301 CERTIFICATION EXAM QUESTIONS WITH CORRECT ANSWERS Unilateral Mistake - Answer-A perception by one party to a contract that does not agree with the facts. Bilateral Mistake - Answer-A perception by both parties to a contract that does not agree with the facts. Duress - 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 - 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. Uniform Commercial Code (UCC) - Answer-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. Parol Evidence Rule - 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 - 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) - Answer-Tangible property consisting of land, all structures permanently attached to the land, and whatever is growing on the land. Assignment - Answer-The transfer of rights or property. Assignor - Answer-The party to a contract who makes an assignment. Assignee - Answer-The individual or entity to whom property, rights, or interests have been transferred. Third-party Beneficiary Contract - Answer-A contract between two parties that benefits a third party. Creditor Beneficiary - Answer-A third-party beneficiary owed a debt that is to be satisfied by performance of a contract. Donee Beneficiary - Answer-A third-party beneficiary who receives the benefit of a contract's performance as a gift from the promisee, with the intent of the contracting parties. Incidental Beneficiary - Answer-A third-party beneficiary who has no contractual rights but benefits from a contract even though that is not the intent of the parties to the contract. Discharge - Answer-The act of ending a contract, agreement, or obligation. Tender - Answer-An offer to perform one's duties under a contract. Novation - Answer-The act of substituting a contract with another contract, an obligation with another obligation, or a party with another party or adding an obligation. Accord and Satisfaction - Answer-An agreement (accord) to substitute performance other than that required in a contract and the carrying out of that agreement (satisfaction). Condition Precedent - Answer-An event that must occur before a duty of performance arises in a contract. Condition Concurrent - Answer-An event that must occur at the same time as another condition in a contract. Condition Subsequent - Answer-An event that, if it occurs, discharges a duty of performance in a contract. Repudiation - Answer-A party's refusal to meet obligations under a contract. Anticipatory Breach - Answer-A party's unequivocal indication before contract performance is due that he or she will not perform when performance is due. Material Breach of Contract - Answer-Violation of the agreement that would justify a nonbreaching party's termination of the contract. Compensatory Damages - Answer-A payment awarded by a court to reimburse a victim for actual harm. Contract - Answer-A legally enforceable agreement between two or more parties. Promisor - Answer-The party to a contract making a promise. Promisee - Answer-The party to a contract to whom a promise is made. Privity of Contract - Answer-The relationship that exists between the parties to a contract. 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.