Docstoc

Contemporary Business Law

Document Sample
Contemporary Business Law Powered By Docstoc
					Business Law and the
Regulation of Business
Chapter 9: Introduction to Contracts



            By
     Richard A. Mann
            &
     Barry S. Roberts
Topics Covered in this Chapter

A. Development of the Law of
   Contracts
B. Definition of a Contract
C. Requirements of a Contract
D. Classification of Contracts
E. Promissory Estoppel
F. Quasi Contracts
           Law of Contracts
n   Definition of Contract – a binding
    agreement that the courts will enforce.
n   Common Law – most contracts are
    governed primarily by State common
    law, including contracts involving
    employment, services, insurance, real
    property (land and anything attached to
    it), patents, and copyrights.
  Law Governing Contracts

      Yes                           Yes
             Specific provision
                  of UCC
                applicable?

                     No
Sale of goods?                            UCC governs


 No
             General contract law
                  governs
    Uniform Commercial Code
n   Article 2 of the UCC governs the sales
    of goods.
n   Sale – the transfer of title from seller to
    buyer.
n   Goods – tangible personal property
    (personal property is all property other
    than an interest in land).
    Requirements of a Contract
n   Mutual Assent – the parties to a contract must
    manifest by words or conduct that they have agreed
    to enter into a contract.
n   Consideration – each party to a contract must
    intentionally exchange a legal benefit or incur a
    legal detriment as an inducement to the other party
    to make a return exchange.
n   Legality of Object – the purpose of a contract
    must not be criminal, tortious, or otherwise against
    public policy.
n   Capacity – the parties to a contract must have
    contractual capacity.
         Validity of Agreements
   Mutual Assent?
                           No
              Yes                              Void
                          No
   Consideration?
              Yes
                           No
      Capacity?
              Yes                         Void or Voidable
                                     No
Free from Invalidating Conduct?
              Yes
Subject Matter Legal?
                          No
              Yes                          Unenforceable
                                No
Statutes of Frauds Satisfied?
                                           Valid Contract
                                  Yes
    Classification of Contracts
n   Express and Implied Contracts
    – Express Contract – an agreement that is
      stated in words, either orally or in writing.
    – Implied in Fact Contract – a contract in
      which the agreement of the parties is
      inferred from their conduct.
n   Bilateral and Unilateral Contracts
    – Bilateral Contract – a contract in which
      both parties exchange promises.
    – Unilateral Contract – a contract in which
      only one party makes a promise.
    Classification of Contracts
n   Valid, Void, Voidable, and
    Unenforceable Contracts
    – Valid Contract – one that meets all of the
      requirements of a binding contract.
    – Void Contract – no contract at all; without
      legal effect.
    – Voidable Contract – a contract capable of
      being made void.
    – Unenforceable Contract – a contract for
      the breach of which the law provides no
      remedy.
    Classification of Contracts
n   Executed and Executory Contracts
    – Executed Contract – a contract that has
      been fully performed by all of the parties.
    – Executory Contract – a contract that has
      yet to be fully performed.
n   Formal and Informal Contracts
    – Formal Contract – an agreement that is
      legally binding because of its particular
      form or mode of expression.
    – Informal Contracts – all contracts other
      than formal contracts.
Contractual and Noncontractual
          Promises
                        All Promises

        Non-
        contractual           Contractual
        promises              promises
        (non-                 (enforceable)
        enforceable)


                       Enforceable
                       non-
                       contractual
                       promises
         Promissory Estoppel
n   Definition – a doctrine enforcing some
    noncontractual promises.
n   Requirements – a promise made under
    circumstances that should lead the promisor
    reasonably to expect that the promise would
    induce the promisee to take definite and
    substantial action, and the promisee does
    take such action.
n   Remedy – a court will enforce the promise
    to the extent necessary to avoid injustice.
            Quasi Contracts
n   Definition – an obligation not based on
  contract that is imposed to avoid injustice.
n Requirements – a court will impose a
  quasi contract when (1)­the plaintiff confers a
  benefit upon the defendant, (2)­the defendant
  knows or appreciates the benefit, and (3)­the
  defendant's retention of the benefit is
  inequitable.
n Remedy – the plaintiff recovers the
  reasonable value of the benefit she conferred
  upon the defendant.
Contracts, Promissory Estoppel,
     and Quasi Contracts

				
DOCUMENT INFO
Shared By:
Categories:
Tags:
Stats:
views:0
posted:7/24/2013
language:English
pages:14