CONTRACT LAW EXAM 2025
QUESTIONS AND ANSWERS
contract - ....ANSWER ...-a legally enforceable and binding agreement
between parties wherein a promise to do or not do something is given in exchange
for valuable consideration. (Forbearance is a term you'll hear for a promise to
NOT do something.)
for·bear·ance - ....ANSWER ...-the action of refraining from exercising a
legal right, especially enforcing the payment of a debt.
Valuable Consideration - ....ANSWER ...-a term used to describe
consideration that is deemed sufficient or appropriate for that which is offered in
exchange.
If the consideration given is not comparable in value to that which is being
offered, the agreement could be looked at as a gift rather than a valid contract —
or, in some instances, as evidence of bad faith in the negotiation.
If a party willingly enters into a valid contract, they are obligated to its terms and
the promises and duties it places upon them. - ....ANSWER ...-
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,Offer and acceptance - ....ANSWER ...-another way to describe the meeting
of the minds that has to occur for a valid contract to come about. Also known as
mutual assent, it's the fully agreed-upon exchange of promises by the parties —
even if it took some back-n-forth of offers and counteroffers to get there.
Consideration - ....ANSWER ...-something valuable that each party
exchanges in order to demonstrate that they agree to the contract's terms.
It can be a promise, money, property, forbearance, or services. In most real estate
transactions, consideration is met in the form of a promise for a promise.
Without consideration, a contract is not legally binding. The legal philosophy is
that a person cannot do something of value without receiving something of value
in turn.
Good consideration (goodwill) - ....ANSWER ...-Good consideration
(goodwill), such as love and affection, can be acceptable in lieu of valuable
consideration in a valid contract.
When real estate is gifted in exchange for good consideration — usually seen in
transactions where property is given to a relative — the term gift deed is used to
describe the conveyance.
For a contract to be valid and legally enforceable, the parties involved in the
contract must be legally competent. Legal competency implies two things:
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, The individual has reached the age of majority (18 years of age in Georgia) or had
their disabilities of minority removed by a court.
The individual is not mentally incompetent or intoxicated by drugs or alcohol. -
....ANSWER ...-
Age of majority laws protect minors from entering into agreements that they may
not have the experience or knowledge to understand. This means that if anyone
under the age of 18 enters into a contract, the contract is considered voidable — at
the option of the minor but NOT the other party.
All contracts entered into with a minor as one of the parties may become valid
when the minor reaches the age of majority if they do not exercise the right to void
the contract within a reasonable time of achieving legal age. -
....ANSWER ...-
Individuals who have been declared mentally incompetent by a judge and
individuals temporarily incapable of comprehending contracts (but have not been
declared incompetent by a judge) cannot enter into a contract. This includes
individuals who might be temporarily mentally incompetent because of alcohol
intoxication, drug use, or other reasons. - ....ANSWER ...-
Offer and acceptance - ....ANSWER ...-Offer and acceptance speaks to the
complete and unreserved agreement of terms and conditions, whereas reality of
....COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED...TRUSTED & VERIFIED 3
QUESTIONS AND ANSWERS
contract - ....ANSWER ...-a legally enforceable and binding agreement
between parties wherein a promise to do or not do something is given in exchange
for valuable consideration. (Forbearance is a term you'll hear for a promise to
NOT do something.)
for·bear·ance - ....ANSWER ...-the action of refraining from exercising a
legal right, especially enforcing the payment of a debt.
Valuable Consideration - ....ANSWER ...-a term used to describe
consideration that is deemed sufficient or appropriate for that which is offered in
exchange.
If the consideration given is not comparable in value to that which is being
offered, the agreement could be looked at as a gift rather than a valid contract —
or, in some instances, as evidence of bad faith in the negotiation.
If a party willingly enters into a valid contract, they are obligated to its terms and
the promises and duties it places upon them. - ....ANSWER ...-
....COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED...TRUSTED & VERIFIED 1
,Offer and acceptance - ....ANSWER ...-another way to describe the meeting
of the minds that has to occur for a valid contract to come about. Also known as
mutual assent, it's the fully agreed-upon exchange of promises by the parties —
even if it took some back-n-forth of offers and counteroffers to get there.
Consideration - ....ANSWER ...-something valuable that each party
exchanges in order to demonstrate that they agree to the contract's terms.
It can be a promise, money, property, forbearance, or services. In most real estate
transactions, consideration is met in the form of a promise for a promise.
Without consideration, a contract is not legally binding. The legal philosophy is
that a person cannot do something of value without receiving something of value
in turn.
Good consideration (goodwill) - ....ANSWER ...-Good consideration
(goodwill), such as love and affection, can be acceptable in lieu of valuable
consideration in a valid contract.
When real estate is gifted in exchange for good consideration — usually seen in
transactions where property is given to a relative — the term gift deed is used to
describe the conveyance.
For a contract to be valid and legally enforceable, the parties involved in the
contract must be legally competent. Legal competency implies two things:
....COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED...TRUSTED & VERIFIED 2
, The individual has reached the age of majority (18 years of age in Georgia) or had
their disabilities of minority removed by a court.
The individual is not mentally incompetent or intoxicated by drugs or alcohol. -
....ANSWER ...-
Age of majority laws protect minors from entering into agreements that they may
not have the experience or knowledge to understand. This means that if anyone
under the age of 18 enters into a contract, the contract is considered voidable — at
the option of the minor but NOT the other party.
All contracts entered into with a minor as one of the parties may become valid
when the minor reaches the age of majority if they do not exercise the right to void
the contract within a reasonable time of achieving legal age. -
....ANSWER ...-
Individuals who have been declared mentally incompetent by a judge and
individuals temporarily incapable of comprehending contracts (but have not been
declared incompetent by a judge) cannot enter into a contract. This includes
individuals who might be temporarily mentally incompetent because of alcohol
intoxication, drug use, or other reasons. - ....ANSWER ...-
Offer and acceptance - ....ANSWER ...-Offer and acceptance speaks to the
complete and unreserved agreement of terms and conditions, whereas reality of
....COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED...TRUSTED & VERIFIED 3
