Contract of Adhesion - PowerPoint by gfa18637

VIEWS: 165 PAGES: 65

More Info
									CHAPTER   10
Legal Purpose
and Proper Form




                  Law for Business and Personal Use
                                       Huber Notes
CHAPTER      10
Legal Purpose
and Proper Form

 10-1 Illegal Agreements
 10-2 The Statute of Frauds




                              Law for Business and Personal Use
                                                   Huber Notes
Gambling involves

1. paying to play, luck,
   and a prize.
2. entry fee, skill, and a
   prize.
3. down payment, risk,
   and a guaranteed
   award.                                               0%            0%             0%              0%

4. none of these.




                                                                                                   e.
                                                                      e.



                                                                                   ..



                                                                                                 es
                                                   ..



                                                                  r iz



                                                                                 n.
                                                 n.




                                                                                                th
                                                              ap



                                                                                ,a
                                               ,a




                                                                                           of
                                                                           isk
                                             k



                                                              d
                                          uc




                                                                                           ne
                                                         an




                                                                            r
                                          ,l




                                                                         t,



                                                                                        no
                                                        ll,
                                        ay




                                                                      en
                                                     ki
                                    pl




                                                                    ym
                                                   ,s
                                    o



                                                 ee



                                                                  pa
                                 gt



                                               yf
                               in




                                                              n
                                                             w
                                            tr
                                y




                                                                        10
                                          Law for Business and Personal Use
                             pa




                                                          do
                                          en




                                                                Huber Notes
Which of the following would not be an
agreement that would restrain trade
unreasonably?

1. allocation of
   markets
2. bid rigging
3. price fixing
4. franchising                                0%            0%          0%          0%




                                                                        g



                                                                                    ng
                                                          g
                                         ts




                                                                      in
                                                      gin
                                      ke




                                                                                 isi
                                                                   ix
                                                   r ig
                                  ar




                                                                               ch
                                                                 ef
                                  m




                                                                                n
                                                                 ic
                                                  d




                                                                            fra
                                               bi



                                                              pr
                              of
                              n
                            io
                          at
                         oc




                                                                 10
                                   Law for Business and Personal Use
                        all




                                                         Huber Notes
As an incentive to stop illegal acts,
restitution is available
1. to a party if they rescind
   before the illegal act
   occurs.
2. for the illegal part of
   every divisible contract.
3. for performed illegal acts
   that do not involve
   violence.                                               0%            0%        0%            0%
4. all of these.




                                                                                                  e.
                                                                                  ...
                                                                   ..




                                                                                                es
                                                      ..



                                                                     e



                                                                                  ct
                                                    d.



                                                                  ev




                                                                                              th
                                                                              la
                                                c in




                                                                                         of
                                                               of



                                                                             ga
                                              es




                                                                         ille



                                                                                        all
                                                            rt
                                              yr



                                                           pa
                                            he




                                                                      ed
                                                       al



                                                                    rm
                                        ft



                                                      eg
                                       yi




                                                                   fo
                                                   ill
                                       rt




                                                                er
                                                 he
                                     pa




                                                              rp
                                               rt



                                                                            10
                                 a




                                              Law for Business and Personal Use
                                                            fo
                                             fo
                                to




                                                                    Huber Notes
Courts may enforce all or part of an illegal
agreement and may grant relief to one of the
parties when
1. the contract is divisible into
   legal and illegal parts.
2. the parties are not equally
   blameworthy.
3. the law was designed to
   protect one of the parties.
4. all of these.                                                     0%            0%          0%            0%




                                                                                                              e.
                                                                               l..



                                                                                             .. .
                                                               ...




                                                                                                            es
                                                                            ua



                                                                                           to
                                                            e




                                                                                                          th
                                                         bl



                                                                          eq



                                                                                          ed



                                                                                                     of
                                                           i
                                                       vis



                                                                      ot



                                                                                     ign



                                                                                                    all
                                                    di



                                                                     en



                                                                                      s
                                                                                   de
                                                  is



                                                                 ar
                                                t




                                                                                as
                                             ac



                                                               es



                                                                               w
                                              r



                                                           rti
                                           nt




                                                                            w
                                                         pa
                                      co




                                                                          la
                                                                                  10
                                       e



                                                       e


                                                    Law for Business and Personal Use
                                                                        e
                                    th



                                                    th



                                                                     th
                                                                          Huber Notes
When the court finds a contract
illegal for unconscionability, it can
1. enforce the legal part
   and refuse to enforce the
   illegal part.
2. refuse to enforce the
   contract.
3. modify the terms of the
   contract to make it fair.
4. all of these.                                             0%            0%          0%           0%




                                                                                                     e.
                                                                                     ...
                                                                      . ..
                                                        ..




                                                                                                   es
                                                      n.




                                                                                   he
                                                                    co




                                                                                                 th
                                                   ta




                                                                                  ft
                                                                   he




                                                                                            of
                                                  r




                                                                              so
                                               pa



                                                              et




                                                                                           all
                                                                             rm
                                               l



                                                              rc
                                            ga



                                                            fo



                                                                           te
                                          le


                                                         en



                                                                        he
                                          e
                                        th



                                                    to



                                                                       t
                                                                    fy
                                   ce



                                                    se



                                                                  i
                                    r




                                                               od
                                                 fu
                                 fo




                                                                            10
                                              Law for Business and Personal Use
                                                              m
                                              re
                               en




                                                                    Huber Notes
The practice of competing firms agreeing to
and charging customers the same price is
known as

1.   price rigging.
2.   usury.
3.   price fixing.
4.   restitution.

                                        0%         0%             0%            0%



                                                   y.




                                                                  g.




                                                                               n.
                                   g.




                                                ur




                                                                in




                                                                                io
                                 in




                                             us




                                                             ix




                                                                             ut
                                igg




                                                           ef




                                                                         tit
                           er




                                                           ic




                                                                          s
                                                                    10



                                                                       re
                           ic




                                                        pr
                                      Law for Business and Personal Use
                        pr




                                                            Huber Notes
Five competing major oil and gas producing companies
agree to divide the United States markets between
themselves, each agreeing not to open gas stations in the
others' markets. This agreement is an example of

1. price fixing.
2. bid rigging.
3. allocation of
   markets.
4. divisible contracts.
                                              0%               0%          0%             0%



                                             g.



                                                           g.




                                                                                             .
                                                                           ts.




                                                                                          ts
                                           in



                                                         gin




                                                                                          c
                                                                        ke



                                                                                       ra
                                        ix



                                                    r ig




                                                                    ar
                                      ef




                                                                                     nt
                                                                    m



                                                                                   co
                                      ic




                                                     d
                                                  bi
                                   pr




                                                                of



                                                                                   e
                                                                                 bl
                                                                n
                                                             io



                                                                             isi
                                                           at




                                                                             v
                                                                          di
                                                          oc
                                                                     10
                                       Law for Business and Personal Use
                                                         all Huber Notes
Lending money at a rate higher
than a state's maximum rate is
1.   usury.
2.   loan sharking.
3.   adhesion.
4.   none of the above.

                                 0%               0%      0%            0%


                                y.




                                                         n.
                                               g.




                                                                        .
                                                                        ve
                             ur




                                                        sio
                                            kin




                                                                      bo
                          us




                                                      he
                                          ar




                                                                   ea
                                                    ad
                                        sh




                                                                 th
                                       an




                                                              of
                                     lo




                                                            ne
                                                         10
                           Law for Business and Personal Use




                                                         no
                                                 Huber Notes
George and Mandy paid $25 to obtain their
marriage license. What type of license did
they purchase?
1. revenue
2. competency
3. both a and b
4. none of the above


                                  0%             0%          0%             0%

                                 ue




                                               cy




                                                             b



                                                                            ve
                                                            nd
                                             n
                            en




                                                                          bo
                                          te



                                                       aa
                             v




                                                                      ea
                                          pe
                          re



                                         m




                                                       th




                                                                     th
                                      co




                                                    bo




                                                                 of
                                                                ne
                                                           10
                             Law for Business and Personal Use




                                                             no
                                                   Huber Notes
Which of the following contracts would
be within the Statute of Frauds?
1.   contracts to buy and sell
     goods for a price of $300 or
     less
2.   promises to pay the debt of
     another person if they cannot
3.   contracts requiring less than a
     year to complete
4.   all of the above are within the
     Statute of Frauds

                                           0%         0%         0%          0%

                                        contracts to promises to   contracts     all of the
                                       buy and sell pay the debt requiring less above are
                                        goods for a of another than a year within the
                                       price of $300 personBusiness and Personal Use
                                           or less
                                                   Law for if to complete Statute of
                                                     they cannot
                                                                                     10
                                                                                Huber Notes
                                                                                  Frauds
Courts will enforce an oral contract for the
purchase of real property if the buyer has

1. occupied or possessed
   the land.
2. made substantial
   improvements to the
   land.
3. made partial or full
   payment.
4. done any of the above.                               0%               0%           0%           0%




                                                                                                    e.
                                                 t. .



                                                                 ...




                                                                                                  ov
                                                                                    ..
                                                              pr
                                                d




                                                                                  .


                                                                                                ab
                                                                               pa
                                                se



                                                             m
                                              es




                                                                                l



                                                                                           he
                                                             li



                                                                             ul
                                           ss



                                                        tia



                                                                           rf



                                                                                           ft
                                        po




                                                                         lo



                                                                                         yo
                                                         n
                                                      ta
                                     or




                                                                    tia



                                                                                    an
                                                   bs



                                                                     r
                                   ed



                                                su



                                                                  pa



                                                                                 ne
                                 i
                              up



                                              e




                                                                              do
                                                               e
                                            ad



                                                             ad
                               c




                                                                        10
                            oc




                                          Law for Business and Personal Use
                                           m



                                                         m
                                                                Huber Notes
A contract that contains a typewritten term
that conflicts with a term handwritten into the
same contract will be
1. interpreted according to
   the handwritten portion.
2. interpreted according to
   typed portion.
3. considered illegal and
   unenforceable.
4. voided and a new                                       0%            0%            0%          0%
   contract written.




                                                                   ..
                                                     ..




                                                                                                 .
                                                                                     ..



                                                                                                 r..
                                                                 o.
                                                   o.




                                                                                  u.



                                                                                               nt
                                                                gt
                                                 gt




                                                                              d



                                                                                             co
                                                              in
                                               in




                                                                             an
                                                             d
                                               d




                                                                                             w
                                                          or



                                                                         al
                                            or




                                                                                          ne
                                                                        eg
                                                          c
                                           c



                                                       ac
                                        ac




                                                                                      a
                                                                     ill



                                                                                      d
                                                     ed
                                       ed




                                                                   d



                                                                                   an
                                                                    e
                                                   et
                                     et




                                                                 er



                                                                                d
                                                   r
                                   r




                                                              sid
                                                rp




                                                                             de
                                rp



                                              te



                                                                           10
                                te




                                                                              i
                                                             n
                                             Law for Business and Personal Use


                                                                           vo
                                                          co
                                            in
                              in




                                                                   Huber Notes
Under the Statute of Frauds in
most states the writing must
1. show the existence of a
   contract.
2. contain all the essential
   terms as defined by the
   Statute of Frauds of the
   state.
3. both a and b.
4. none of the above.                                     0%            0%           0%        0%




                                                                                 b.



                                                                                               .
                                                                                               ve
                                                                   .
                                                                  l..
                                                    ...




                                                                                nd



                                                                                             bo
                                                                 ia
                                                    a




                                                                           aa
                                                               nt




                                                                                          ea
                                                of



                                                             se
                                               ce




                                                                           th



                                                                                        th
                                                             es



                                                                        bo
                                          en




                                                                                     of
                                                        he
                                         ist




                                                                                   ne
                                                        lt
                                       ex




                                                                                no
                                                     al
                                      e



                                                    n
                                   th



                                                   i
                                                ta
                                  ow



                                              n



                                                                         10
                                           Law for Business and Personal Use
                                           co
                               sh




                                                                 Huber Notes
A type of contract prepared by the stronger party to favor
the stronger party's interest and usually offered to the
consumer on a "take or leave it basis" is known as a(n)

1. executable
   contract.
2. contract of
   adhesion.
3. collateral contract.
4. none of the above.                                 0%             0%               0%            0%




                                                                                                    .
                                                  .




                                                                                      .
                                                                n.
                                                ct




                                                                                                  ve
                                                                                    t
                                                                                 ac
                                                                io
                                              ra




                                                                                                bo
                                                                                  r
                                                              es
                                            nt




                                                                               nt



                                                                                               ea
                                                           dh
                                          co




                                                                          co



                                                                                           th
                                                            a
                                           e




                                                                          al
                                                         of
                                        bl




                                                                                          of
                                                                        r
                                                                     te
                                      a



                                                      ct
                                   ut




                                                                                     ne
                                                                     la
                                                 tra
                                   ec




                                                                   l



                                                                                  no
                                                                co
                                                                             10
                                                  n

                                               Law for Business and Personal Use
                                 ex



                                               co



                                                                     Huber Notes
Which of the following is a contract
without the Statute of Frauds?
1.   a promise to pay for your
     sister's debt if she cannot
2.   a contract to buy a home
     sound system valued at
     $4,000
3.   a contract to do the next two
     year's income taxes for a
     client
4.   an agreement to type your
     roommate's term paper for          0%        0%        0%       0%
     $50
                                       a promise a contract a contract      an
                                       to pay for   to buy a  to do the agreement
                                          your    home sound next two to type your
                                     sister' system year's roommate&
                                     s debt if she valued at   income #039;s term
                                        cannot                                 10
                                                             taxes for a Personal
                                               Law for Business and paper for Use
                                                     $4,000
                                                                client    Huber Notes
                                                                           $50
The law found in most jurisdictions in which certain
agreements are not enforceable unless written and signed
by the party against whom the contract is to be enforced is
usually called the

1. Statute of Frauds.
2. Statute of
   Enforceables.
3. Statute of
   Limitations.
                                                       0%              0%              0%        0%
4. none of the above.

                                                   .




                                                                                                 .
                                                                  s.




                                                                                   .
                                                ds




                                                                                                 ve
                                                                                 ns
                                                                   e
                                               au



                                                                bl



                                                                                t io



                                                                                               bo
                                                            ea
                                             Fr




                                                                            it a



                                                                                            ea
                                                           rc
                                          of




                                                                         L im




                                                                                          th
                                                         fo
                                        te



                                                       En




                                                                                       of
                                                                       of
                                     tu




                                                                                     ne
                                                    of
                                      a




                                                                    te
                                   St




                                                                                  no
                                                  te



                                                                 tu
                                               tu




                                                               a
                                                            St
                                                                           10
                                             Law for Business and Personal Use
                                                a
                                             St




                                                                   Huber Notes
Jean enters into a contract in which she will perform nail care services
in Monique's beauty shop for a monthly fee payable to Monique plus 3
percent of Jean's retail business. By definition which of the following is
not an essential term to the contract?

1.   names of parties
2.   signatures
3.   price
4.   quality of
     performance
                                                            0%          0%          0%           0%




                                                                        es




                                                                                 e
                                                          es




                                                                                                 ce
                                                                                 ic
                                                                     ur
                                                      rti




                                                                                                an
                                                                              pr
                                                                   t
                                                     pa



                                                                na




                                                                                           rm
                                                               sig
                                                of




                                                                                           fo
                                                                                        er
                                                es




                                                                                      fp
                                               m
                                            na




                                                                                  yo
                                                                               lit
                                                                                   10

                                                                                a
                                                     Law for Business and Personal Use



                                                                             qu
                                                                           Huber Notes
Many states require that certain essential terms be
included in a contract to create a valid offer. When some
essential element is missing, however, what type of
contract may be found to exist by a court.


1.   executed contract
2.   quasi-contract
3.   adhesion contract
4.   executory contract
                                                      0%              0%        0%            0%


                                                 ct




                                                                 ct




                                                                               ct




                                                                                                t
                                                                                             ac
                                                 ra



                                                                tra




                                                                               ra



                                                                                             tr
                                              nt




                                                                             nt
                                                             on




                                                                                           on
                                         co




                                                                           co
                                                            c




                                                                                         c
                                                        si-
                                         ed




                                                                         n



                                                                                      ry
                                                                      sio
                                                         a




                                                                                       o
                                      ut



                                                      qu




                                                                                    ut
                                                                    he
                                   ec




                                                                                 ec
                                                                             10
                                                                  ad
                                               Law for Business and Personal Use
                                 ex




                                                                               ex
                                                                     Huber Notes
Under the UCC, in which of the following
cases is a writing not required?
1.   where ordered goods are
     specially manufactured and
     cannot be resold
2.   when goods have been
     ordered and paid for and the
     seller has accepted payment
3.   when the goods have been
     received and accepted by the
     buyer
                                                                0%            0%         0%            0%
4.   in all of the above cases no
     writing is required


                                                         . ..




                                                                                                       ..
                                                                                       .
                                                                       . ..



                                                                                     e.



                                                                                                     e.
                                                       ar




                                                                                   eb




                                                                                                   s
                                                                      n




                                                                                                ca
                                                       s



                                                                    ee
                                                    od




                                                                                av



                                                                                                 e
                                                                  eb
                                               go




                                                                                              ov
                                                                              sh
                                                                v




                                                                                           ab
                                                d




                                                                               d
                                                             ha
                                              re




                                                                            oo



                                                                                         he
                                                              s
                                           de




                                                                        eg
                                                           od




                                                                                     ft
                                        or



                                                      go



                                                                       th



                                                                                    lo
                                        e




                                                                    n



                                                                                   al
                                                       n
                                       r
                                    he




                                                                  he
                                                    he



                                                                              10
                                                Law for Business and Personal Use



                                                                               in
                                    w




                                                                  w
                                               w




                                                                      Huber Notes
Agreements that delay or prevent
justice are
1.   valid.
2.   voidable.
3.   void.
4.   venerable.


                           0%            0%      0%          0%
                       .




                                         .




                                                d.




                                                             e.
                      id




                                       le




                                                 i




                                                              l
                                     b
                       l




                                              vo




                                                           ab
                    va




                                  da




                                                        er
                                   i

                                                         10
                                vo




                                                         n
                           Law for Business and Personal Use




                                                      ve
                                                 Huber Notes
CHAPTER      10
Legal Purpose
and Proper Form

 10-1 Illegal Agreements
 10-2 The Statute of Frauds




                              Law for Business and Personal Use
                                                    Huber Notes
FOCUS—What do you think…
 What types of contracts that society,
  through its courts of law, should not
  enforce even though all the essential
  elements for an enforceable contract
  are present.



Chapter 10                 Law for Business and Personal Use
Slide 24                                         Huber Notes
      WHICH AGREEMENTS
      ARE ILLEGAL?
   Illegal lotteries
     Lottery
          3 elements
                 Prize - something of value for one or more winners
                 Chance – the winner determined solely by luck
                 Consideration – a payment to participate
     Wager
          To bet with an uncertain outcome of an event
                 Such as a football game (picking numbers)
                 Basketball (March Madness)
     Most states have legalized various forms of gambling - under regulated conditions:
          Casinos –
                 Gambling Laws in the U.S. – see website for better understanding
          Pari-mutual betting
                 Betting on horse or dog races
          State-run lotteries
                 Often with millions in the jackpot…lotto tickets (WI or IL)
          Bingo games and pull-tab betting
                 Usually permittable in most states set up by charitable events, churches or educational projects.



     Chapter 10                                                                 Law for Business and Personal Use
     Slide 25                                                                                         Huber Notes
                                                            (continued)
  WHICH AGREEMENTS
  ARE ILLEGAL?
 Agreements to pay usurious interest
   States have to follow rules about how much they can
    charge for interest rates….no more than 18%
   Legal rate of interest – rate to be paid
   Small loan rate of interest – up to 36% a year
        On a small loan – up to $2000
 Agreements involving illegal discrimination
   Example:
        An agreement between a hotel chain and a local manager
         not to accept a particular race to as a guest.

  Chapter 10                                Law for Business and Personal Use
  Slide 26                                                        Huber Notes
                                                                 (continued)
  WHICH AGREEMENTS
  ARE ILLEGAL?
 Agreements that obstruct legal procedures
    Pay non-expert witnesses in a trial to testify or pay for false
     testimony
    Bribe jurors
    Refrain from informing on or prosecuting an alleged crime in
     exchange for money or other valuable consideration –
     compounding a crime.
 Agreements made without a required competency license
    Competency license – to ensure that they can perform adequately.
        Teachers, lawyers, barbers, doctors, etc.
    Revenue License – purpose to raise revenue rather to protect the
     public, contracts made by the unlicensed person are valid.

 Chapter 10                                      Law for Business and Personal Use
 Slide 27                                                              Huber Notes
                                                            (continued)
WHICH AGREEMENTS
ARE ILLEGAL?
 Agreements that affect marriage negatively
      Mail order brides are regulated by U.S. federal law

 Agreements that restrain trade unreasonably
      Price fixing – crime under federal law
      Price rigging – form of price fixing
      Resale price maintenance – when manufacturers want
       retailers to sell product at a particular price
      Allocation of markets – price fixing in divided
       markets…outside the U.S.



Chapter 10                                  Law for Business and Personal Use
Slide 28                                                          Huber Notes
                                                                    (continued)
WHICH AGREEMENTS
ARE ILLEGAL?
 Agreements not to compete
      Price fixing and market allocation are agreements not to
       compete….
      But, 1 type of agreement that is ENFORCEABLE is:
          When a person is hired they may agree that they will not
           compete with their former employer after the employment is
           terminated.
          These agreements become illegal if they are unreasonable:
              Time period for the limitation
              Geographic area to which the limitation applies
              Employer’s interest protected by the limitation
          Example – an agreement not to compete for 20 years would be
           illegal!


Chapter 10                                          Law for Business and Personal Use
Slide 29                                                                  Huber Notes
       Name the eight illegal agreements
       discussed in this section.




Chapter 10                   Law for Business and Personal Use
Slide 30                                           Huber Notes
WHEN WILL THE COURTS ENFORCE
ILLEGAL AGREEMENTS?
 Protected victims
      blue-sky laws – prohibit sales of worthless
      stocks and bonds
 The excusably ignorant
     These people are excusably ignorant if:
         They do not know the contract is illegal, but
         The other party knows the transaction is illegal,
          and
         The illegality is minor
Chapter 10                             Law for Business and Personal Use
Slide 31                                                     Huber Notes
                                                                   (continued)
WHEN WILL THE COURTS ENFORCE
ILLEGAL AGREEMENTS?
 Rescission prior to illegal act
      If a party rescinds before illegal act occurs.
          Example – Student A pays Student B to scratch Teachers car.
           Student A is feeling guilty and pulls the deal.
 Divisible contracts
      Divisible means that separate consideration is given for the
       legal and illegal parts of the contract.
      Unconscionability
          Occurs when there is a grossly unfair contract that parties
           under ordinary circumstances would not accept.
          The UCC makes unconscionable contracts for the sale of
           goods subject to the rules for illegality. Such contracts have 2
           elements:
              Procedural – how the contract is created
              Substantive – unfair terms in the agreement

Chapter 10                                         Law for Business and Personal Use
Slide 32                                                                 Huber Notes
       Under what circumstances will the
       courts enforce illegal agreements?




Chapter 10                    Law for Business and Personal Use
Slide 33                                            Huber Notes
10-2 The Statute of Frauds
GOALS
 Explain why the Statute of Frauds is
  necessary and what it requires
 Identify the main instances when the
  Statute of Frauds requires a writing
 Understand the rules of contract
  interpretation
Chapter 10                Law for Business and Personal Use
Slide 34                                        Huber Notes
FOCUS
 Must all contracts be in writing?
 The Guts of a Contract (Contract Law)




Chapter 10                Law for Business and Personal Use
Slide 35                                        Huber Notes
What is ―Statute of Frauds‖
 The "statute of frauds" - also commonly
  abbreviated as "SOF" - is a rule of law
  that requires certain kinds of contracts
  to be in writing (not oral or "verbal") and
  that they be signed by all the parties to
  the deal in order to be binding. The
  types of contracts and rules can vary
  by jurisdication.
Chapter 10                   Law for Business and Personal Use
Slide 36                                           Huber Notes
      WHY HAVE A STATUTE

              FRAUDS?
      OF within the Statute of Frauds
    Contracts
         Executed contracts – is one that has been fully performed
         Executory contracts – is one that has NOT been fully performed
               Quasi-contract – exists when some element of an enforceable contract is missing (such as a
                signed writing), yet courts award money to prevent the unjust enrichment of one party.
   Requirements of the writing
         Statute of Frauds requirements says
           1.   Names of the parties
           2.   Subject matter description
           3.   Price
           4.   Quantity
           5.   Signature
           6.   Other essential terms
         UCC requirements says
               The quanitity of goods
               That a contract has been created between the parties
         Special rules for signatures
               On certain documents it can be engraved, stamped, written (signature), or printed.



        Chapter 10                                                     Law for Business and Personal Use
        Slide 37                                                                             Huber Notes
       Name the six essential elements
       in a writing required by the most
       demanding Statutes of Frauds
       standards.



Chapter 10                    Law for Business and Personal Use
Slide 38                                            Huber Notes
TYPES OF Executor CONTRACTS
WITHIN THE STATUTE OF
FRAUDS
1. Contract for the sale of goods for $500
   or more
2. Contract to sell an interest in real
   property
3. Contracts that require more than one
   year to complete


Chapter 10                 Law for Business and Personal Use
Slide 39                                         Huber Notes
                                              (continued)
TYPES OF CONTRACTS WITHIN
THE STATUTE OF FRAUDS
4. Contract to pay a debt or answer for
   another’s debt
      Exception—main purpose rule
5. Contract for which the consideration is
   marriage



Chapter 10                    Law for Business and Personal Use
Slide 40                                            Huber Notes
       Name the five types of executory
       contracts that require a writing.




Chapter 10                    Law for Business and Personal Use
Slide 41                                            Huber Notes
   HOW ARE CONTRACTS
   INTERPRETED?
 Integration clause
    Establishes that only those provisions contained in the written
     agreement between the parties of which the integration clause
     is a part shall have any force or effect on the parties, and
     excludes all other provisions not contained within the written
     agreement.
 Specific rules of interpretation
      Analysis
      Conflicting terms                             Example:
      Words                                        Real Estate
      Authors of ambiguity                         Mortgages
        Contracts of Adhesion
            a contract that heavily restricts one party while leaving the other free
             (as some standard form printed contracts); implies inequality in
             bargaining power
    Implied reasonableness
  Chapter 10                                             Law for Business and Personal Use
  Slide 42                                                                     Huber Notes
   HOW ARE CONTRACTS
   INTERPRETED?
 Parol evidence rule
    a rule that oral evidence cannot be used to contradict the terms of
     a written contract
        rule of evidence - (law) a rule of law whereby any alleged matter of fact
         that is submitted for investigation at a judicial trial is established or
         disproved
 Exception to the parol evidence rule
   1. To clarify ambiguities in the written agreement
   2. If the written contract was not intended to be a complete agreement
   3. If a condition necessary to the existence of the contract never
      occurred
   4. If fraud, forgery, illegality, mistake, or misrepresentation occurred
   5. To show the parties reached another agreement or terminated the
      contract under consideration after executing the written contract
   6. To show that the contract is voidable because a party lacked
      contractual capacity
  Chapter 10                                       Law for Business and Personal Use
  Slide 43                                                               Huber Notes
   Parol of Evidence…
 The parol evidence rule is a common trap for
  consumers. For example:
    Health club contracts. You enroll in a health club, and the
     salesperson tells you that the contract can be cancelled. You
     later decide you would like to cancel, but the written contract
     provides that it is non-cancellable. The oral promises of the
     salesperson are generally non-enforceable.
    Auto sales agreements. You purchase a used car, and the
     salesperson tells you it is "good as new." But the contract
     provides that the sale is As Is. Again, in most circumstances the
     written contract controls.
    Timeshares. While in certain jurisdictions, and in certain
     circumstances, a consumer may have a right of rescission,
     some people attend real estate sales presentations at which
     they may feel pressured into immediately signing binding
     contracts.
  Chapter 10                                  Law for Business and Personal Use
  Slide 44                                                          Huber Notes
       Explain the parol evidence rule.




Chapter 10                    Law for Business and Personal Use
Slide 45                                            Huber Notes
Gambling involves

1. paying to play, luck,
                                                    92%
   and a prize.
2. entry fee, skill, and a
   prize.
3. down payment, risk,
   and a guaranteed                                                                                  8%
   award.                                                             0%             0%

4. none of these.




                                                                                                   e.
                                                                      e.



                                                                                   ..



                                                                                                 es
                                                   ..



                                                                  r iz



                                                                                 n.
                                                 n.




                                                                                                th
                                                              ap



                                                                                ,a
                                               ,a




                                                                                           of
                                                                           isk
                                             k



                                                              d
                                          uc




                                                                                           ne
                                                         an




                                                                            r
                                          ,l




                                                                         t,



                                                                                        no
                                                        ll,
                                        ay




                                                                      en
                                                     ki
                                    pl




                                                                    ym
                                                   ,s
                                    o



                                                 ee



                                                                  pa
                                 gt



                                               yf
                               in




                                                              n
                                                             w
                                            tr
                                y




                                          Law for Business and Personal Use
                             pa




                                                          do
                                          en




                                                                Huber Notes
Which of the following would not be an
agreement that would restrain trade
unreasonably?
                                                                                  75%
1. allocation of
   markets
2. bid rigging
3. price fixing                          17%
4. franchising                                                         8%
                                                           0%




                                                                      g



                                                                                  ng
                                                       g
                                         ts




                                                                    in
                                                     gin
                                      ke




                                                                               isi
                                                                  ix
                                                r ig
                                  ar




                                                                             ch
                                                                ef
                                  m




                                                                              n
                                                               ic
                                                 d




                                                                          fra
                                              bi



                                                            pr
                              of
                              n
                            io
                          at
                         oc




                                   Law for Business and Personal Use
                        all




                                                         Huber Notes
As an incentive to stop illegal acts,
restitution is available
1. to a party if they rescind
   before the illegal act                                  83%
   occurs.
2. for the illegal part of
   every divisible contract.
3. for performed illegal acts
   that do not involve                                                   8%        8%
   violence.                                                                                     0%
4. all of these.




                                                                                                  e.
                                                                                  ...
                                                                   ..




                                                                                                es
                                                      ..



                                                                     e



                                                                                  ct
                                                    d.



                                                                  ev




                                                                                              th
                                                                              la
                                                c in




                                                                                         of
                                                               of



                                                                             ga
                                              es




                                                                         ille



                                                                                        all
                                                            rt
                                              yr



                                                           pa
                                            he




                                                                      ed
                                                       al



                                                                    rm
                                        ft



                                                      eg
                                       yi




                                                                   fo
                                                   ill
                                       rt




                                                                er
                                                 he
                                     pa




                                                              rp
                                               rt
                                 a




                                              Law for Business and Personal Use
                                                            fo
                                             fo
                                to




                                                                    Huber Notes
Courts may enforce all or part of an illegal
agreement and may grant relief to one of the
parties when
                                                                                                            67%
1. the contract is divisible into
   legal and illegal parts.
2. the parties are not equally
   blameworthy.
3. the law was designed to                                                       17%
   protect one of the parties.                                       8%                        8%
4. all of these.




                                                                                                              e.
                                                                               l..



                                                                                             .. .
                                                               ...




                                                                                                            es
                                                                            ua



                                                                                           to
                                                            e




                                                                                                          th
                                                         bl



                                                                          eq



                                                                                          ed



                                                                                                     of
                                                           i
                                                       vis



                                                                      ot



                                                                                     ign



                                                                                                    all
                                                    di



                                                                     en



                                                                                      s
                                                                                   de
                                                  is



                                                                 ar
                                                t




                                                                                as
                                             ac



                                                               es



                                                                               w
                                              r



                                                           rti
                                           nt




                                                                            w
                                                         pa
                                      co




                                                                          la
                                       e



                                                       e


                                                    Law for Business and Personal Use
                                                                        e
                                    th



                                                    th



                                                                     th
                                                                          Huber Notes
When the court finds a contract
illegal for unconscionability, it can
1. enforce the legal part
                                                                                                   58%
   and refuse to enforce the
   illegal part.
2. refuse to enforce the
   contract.                                                             25%
3. modify the terms of the
   contract to make it fair.                                 8%                        8%
4. all of these.




                                                                                                     e.
                                                                                     ...
                                                                      . ..
                                                        ..




                                                                                                   es
                                                      n.




                                                                                   he
                                                                    co




                                                                                                 th
                                                   ta




                                                                                  ft
                                                                   he




                                                                                            of
                                                  r




                                                                              so
                                               pa



                                                              et




                                                                                           all
                                                                             rm
                                               l



                                                              rc
                                            ga



                                                            fo



                                                                           te
                                          le


                                                         en



                                                                        he
                                          e
                                        th



                                                    to



                                                                       t
                                                                    fy
                                   ce



                                                    se



                                                                  i
                                    r




                                                               od
                                                 fu
                                 fo




                                              Law for Business and Personal Use
                                                              m
                                              re
                               en




                                                                    Huber Notes
The practice of competing firms agreeing to
and charging customers the same price is
known as
                                                                75%
1.   price rigging.
2.   usury.
3.   price fixing.
4.   restitution.
                                      17%
                                                                               8%
                                                  0%



                                                  y.




                                                                 g.




                                                                              n.
                                   g.




                                               ur




                                                               in




                                                                               io
                                 in




                                            us




                                                            ix




                                                                            ut
                                igg




                                                          ef




                                                                        tit
                           er




                                                          ic




                                                                         s
                                                                      re
                           ic




                                                       pr
                                      Law for Business and Personal Use
                        pr




                                                            Huber Notes
Five competing major oil and gas producing companies
agree to divide the United States markets between
themselves, each agreeing not to open gas stations in the
others' markets. This agreement is an example of
                                                                          75%
1. price fixing.
2. bid rigging.
3. allocation of
   markets.
                                                           17%
4. divisible contracts.                       8%
                                                                                          0%



                                             g.



                                                           g.




                                                                                             .
                                                                           ts.




                                                                                          ts
                                           in



                                                         gin




                                                                                          c
                                                                        ke



                                                                                       ra
                                        ix



                                                    r ig




                                                                    ar
                                      ef




                                                                                     nt
                                                                    m



                                                                                   co
                                      ic




                                                     d
                                                  bi
                                   pr




                                                                of



                                                                                   e
                                                                                 bl
                                                                n
                                                             io



                                                                             isi
                                                           at




                                                                             v
                                                                          di
                                                          oc
                                       Law for Business and Personal Use
                                                         all Huber Notes
Lending money at a rate higher
than a state's maximum rate is
1.   usury.
                                83%
2.   loan sharking.
3.   adhesion.
4.   none of the above.
                                                                        17%
                                                  0%      0%


                                y.




                                                         n.
                                               g.




                                                                        .
                                                                        ve
                             ur




                                                        sio
                                            kin




                                                                      bo
                          us




                                                      he
                                          ar




                                                                   ea
                                                    ad
                                        sh




                                                                 th
                                       an




                                                              of
                                     lo




                                                            ne
                           Law for Business and Personal Use




                                                         no
                                                 Huber Notes
George and Mandy paid $25 to obtain their
marriage license. What type of license did
they purchase?
1. revenue
                                  45%
2. competency
3. both a and b              27%
4. none of the above                  18%
                                                                            9%



                                 ue




                                               cy




                                                             b



                                                                            ve
                                                            nd
                                             n
                            en




                                                                          bo
                                          te



                                                       aa
                             v




                                                                      ea
                                          pe
                          re



                                         m




                                                       th




                                                                     th
                                      co




                                                    bo




                                                                 of
                                                                ne
                             Law for Business and Personal Use




                                                             no
                                                   Huber Notes
Which of the following contracts would
be within the Statute of Frauds?
1.   contracts to buy and sell
     goods for a price of $300 or                                           55%
     less
2.   promises to pay the debt of
     another person if they cannot
3.   contracts requiring less than a
     year to complete
                                                     27%
4.   all of the above are within the
     Statute of Frauds
                                           9%                    9%


                                        contracts to promises to   contracts     all of the
                                       buy and sell pay the debt requiring less above are
                                        goods for a of another than a year within the
                                                   Law for if to complete Statute of
                                       price of $300 personBusiness and Personal Use
                                           or less   they cannot                Huber Notes
                                                                                  Frauds
Courts will enforce an oral contract for the
purchase of real property if the buyer has

1. occupied or possessed
   the land.                                                                                      82%
2. made substantial
   improvements to the
   land.
3. made partial or full
   payment.                                             9%                            9%
4. done any of the above.                                                0%




                                                                                                    e.
                                                 t. .



                                                                 ...




                                                                                                  ov
                                                                                    ..
                                                              pr
                                                d




                                                                                  .


                                                                                                ab
                                                                               pa
                                                se



                                                             m
                                              es




                                                                                l



                                                                                           he
                                                             li



                                                                             ul
                                           ss



                                                        tia



                                                                           rf



                                                                                           ft
                                        po




                                                                         lo



                                                                                         yo
                                                         n
                                                      ta
                                     or




                                                                    tia



                                                                                    an
                                                   bs



                                                                     r
                                   ed



                                                su



                                                                  pa



                                                                                 ne
                                 i
                              up



                                              e




                                                                              do
                                                               e
                                            ad



                                                             ad
                               c
                            oc




                                          Law for Business and Personal Use
                                           m



                                                         m
                                                                Huber Notes
A contract that contains a typewritten term
that conflicts with a term handwritten into the
same contract will be
1. interpreted according to                            67%
   the handwritten portion.
2. interpreted according to
   typed portion.
3. considered illegal and
   unenforceable.                                                    17%
                                                                                      8%          8%
4. voided and a new
   contract written.




                                                                   ..
                                                     ..




                                                                                                 .
                                                                                     ..



                                                                                                 r..
                                                                 o.
                                                   o.




                                                                                  u.



                                                                                               nt
                                                                gt
                                                 gt




                                                                              d



                                                                                             co
                                                              in
                                               in




                                                                             an
                                                             d
                                               d




                                                                                             w
                                                          or



                                                                         al
                                            or




                                                                                          ne
                                                                        eg
                                                          c
                                           c



                                                       ac
                                        ac




                                                                                      a
                                                                     ill



                                                                                      d
                                                     ed
                                       ed




                                                                   d



                                                                                   an
                                                                    e
                                                   et
                                     et




                                                                 er



                                                                                d
                                                   r
                                   r




                                                              sid
                                                rp




                                                                             de
                                rp



                                              te
                                te




                                                                              i
                                                             n
                                             Law for Business and Personal Use


                                                                           vo
                                                          co
                                            in
                              in




                                                                   Huber Notes
Under the Statute of Frauds in
most states the writing must
1. show the existence of a                                                      100%
   contract.
2. contain all the essential
   terms as defined by the
   Statute of Frauds of the
   state.
3. both a and b.
4. none of the above.                                     0%            0%                     0%




                                                                                 b.



                                                                                               .
                                                                                               ve
                                                                   .
                                                                  l..
                                                    ...




                                                                                nd



                                                                                             bo
                                                                 ia
                                                    a




                                                                           aa
                                                               nt




                                                                                          ea
                                                of



                                                             se
                                               ce




                                                                           th



                                                                                        th
                                                             es



                                                                        bo
                                          en




                                                                                     of
                                                        he
                                         ist




                                                                                   ne
                                                        lt
                                       ex




                                                                                no
                                                     al
                                      e



                                                    n
                                   th



                                                   i
                                                ta
                                  ow



                                              n


                                           Law for Business and Personal Use
                                           co
                               sh




                                                                 Huber Notes
A type of contract prepared by the stronger party to favor
the stronger party's interest and usually offered to the
consumer on a "take or leave it basis" is known as a(n)

1. executable
                                                                 45%
   contract.
                                                   36%
2. contract of
   adhesion.
3. collateral contract.                                                               9%            9%
4. none of the above.




                                                                                                    .
                                                  .




                                                                                      .
                                                                n.
                                                ct




                                                                                                  ve
                                                                                    t
                                                                                 ac
                                                                io
                                              ra




                                                                                                bo
                                                                                  r
                                                              es
                                            nt




                                                                               nt



                                                                                               ea
                                                           dh
                                          co




                                                                          co



                                                                                           th
                                                            a
                                           e




                                                                          al
                                                         of
                                        bl




                                                                                          of
                                                                        r
                                                                     te
                                      a



                                                      ct
                                   ut




                                                                                     ne
                                                                     la
                                                 tra
                                   ec




                                                                   l



                                                                                  no
                                                                co
                                                  n

                                               Law for Business and Personal Use
                                 ex



                                               co



                                                                     Huber Notes
Which of the following is a contract
without the Statute of Frauds?
1.   a promise to pay for your
                                                                    75%
     sister's debt if she cannot
2.   a contract to buy a home
     sound system valued at
     $4,000
3.   a contract to do the next two
     year's income taxes for a
     client                                      17%
4.   an agreement to type your                              8%
     roommate's term paper for          0%
     $50
                                       a promise a contract a contract      an
                                       to pay for   to buy a  to do the agreement
                                          your    home sound next two to type your
                                     sister' system year's roommate&
                                     s debt if she valued at   income #039;s term
                                        cannot               taxes for a Personal
                                               Law for Business and paper for Use
                                                     $4,000
                                                                client    Huber Notes
                                                                           $50
The law found in most jurisdictions in which certain
agreements are not enforceable unless written and signed
by the party against whom the contract is to be enforced is
usually called the

1. Statute of Frauds.                               91%

2. Statute of
   Enforceables.
3. Statute of
   Limitations.                                                        9%
                                                                                       0%        0%
4. none of the above.

                                                   .




                                                                                                 .
                                                                  s.




                                                                                   .
                                                ds




                                                                                                 ve
                                                                                 ns
                                                                   e
                                               au



                                                                bl



                                                                                t io



                                                                                               bo
                                                            ea
                                             Fr




                                                                            it a



                                                                                            ea
                                                           rc
                                          of




                                                                         L im




                                                                                          th
                                                         fo
                                        te



                                                       En




                                                                                       of
                                                                       of
                                     tu




                                                                                     ne
                                                    of
                                      a




                                                                    te
                                   St




                                                                                  no
                                                  te



                                                                 tu
                                               tu




                                                               a
                                                            St
                                             Law for Business and Personal Use
                                                a
                                             St




                                                                   Huber Notes
Jean enters into a contract in which she will perform nail care services
in Monique's beauty shop for a monthly fee payable to Monique plus 3
percent of Jean's retail business. By definition which of the following is
not an essential term to the contract?

1.   names of parties                                                                           67%
2.   signatures
3.   price
4.   quality of
     performance                                                       17%
                                                            8%                      8%




                                                                        es




                                                                                 e
                                                          es




                                                                                                 ce
                                                                                 ic
                                                                     ur
                                                      rti




                                                                                                an
                                                                              pr
                                                                   t
                                                     pa



                                                                na




                                                                                           rm
                                                               sig
                                                of




                                                                                           fo
                                                                                        er
                                                es




                                                                                      fp
                                               m
                                            na




                                                                                  yo
                                                                               lit
                                                                                a
                                                     Law for Business and Personal Use



                                                                             qu
                                                                           Huber Notes
Many states require that certain essential terms be
included in a contract to create a valid offer. When some
essential element is missing, however, what type of
contract may be found to exist by a court.

                                                                             45%
1.   executed contract
2.   quasi-contract
                                                                  27%
3.   adhesion contract                                18%
4.   executory contract                                                                     9%




                                                 ct




                                                                 ct




                                                                             ct




                                                                                              t
                                                                                           ac
                                                 ra



                                                                tra




                                                                             ra



                                                                                           tr
                                              nt




                                                                           nt
                                                             on




                                                                                         on
                                         co




                                                                         co
                                                            c




                                                                                       c
                                                        si-
                                         ed




                                                                         n



                                                                                    ry
                                                                      sio
                                                         a




                                                                                     o
                                      ut



                                                      qu




                                                                                  ut
                                                                    he
                                   ec




                                                                               ec
                                                                  ad
                                               Law for Business and Personal Use
                                 ex




                                                                             ex
                                                                     Huber Notes
Under the UCC, in which of the following
cases is a writing not required?
1.   where ordered goods are
     specially manufactured and
     cannot be resold
2.   when goods have been
     ordered and paid for and the
     seller has accepted payment
3.   when the goods have been
     received and accepted by the
     buyer
4.   in all of the above cases no
     writing is required



                                    Law for Business and Personal Use
                                                          Huber Notes
Agreements that delay or prevent
justice are
1.   valid.
2.   voidable.
3.   void.
4.   venerable.


                           0%            0%      0%          0%
                       .




                                         .




                                                d.




                                                             e.
                      id




                                       le




                                                 i




                                                              l
                                     b
                       l




                                              vo




                                                           ab
                    va




                                  da




                                                        er
                                   i

                                                         10
                                vo




                                                         n
                           Law for Business and Personal Use




                                                      ve
                                                 Huber Notes

								
To top