Questions and Answers
Which of the following classifications applies to contracts? (Select all that apply)
What distinguishes bilateral contracts from unilateral contracts?
Bilateral contracts involve a promise exchanged for a promise, while unilateral contracts involve a promise exchanged for an act.
What are express contracts?
Contracts where the terms are fully and explicitly stated in words, either oral or written.
What are implied contracts?
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What conditions must be met for a court to find an implied contract?
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What is a quasi-contract?
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What defines a valid contract?
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What is the difference between void and voidable contracts?
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What characterizes executed contracts?
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What are formal contracts?
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What distinguishes informal contracts?
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Study Notes
Classification of Contracts
- Contracts are categorized into various types: Bilateral, Unilateral, Express, Implied, Quasi-contracts, Valid, Void, Voidable, Unenforceable, Executed, and Executory, as well as Formal and Informal.
Bilateral vs Unilateral Contracts
- A bilateral contract involves a promise in exchange for a promise, creating binding obligations as soon as promises are exchanged.
- A unilateral contract involves a promise exchanged for an act, where performance is required from the offeree. The most common type includes rewards.
Express vs Implied Contracts
- Express contracts have clearly stated terms, either orally or in writing, while implied contracts arise from the conduct of the involved parties.
Conditions of Implied Contracts
- For a court to recognize an implied contract, the following must be established:
- The plaintiff provided goods/services to the defendant.
- The plaintiff expected compensation, and a reasonable person would have similarly expected payment.
- The defendant had a chance to reject the services but accepted them.
Quasi-Contract
- A quasi-contract is not a true contract; it is enforced by courts to prevent unjust enrichment when one party benefits at the expense of another without a legitimate agreement.
Valid, Void, Voidable, and Unenforceable Contracts
- A valid contract contains all necessary legal elements and is enforceable.
- A void contract has no legal effects due to illegality or serious defects.
- A voidable contract allows parties to withdraw or enforce, typically where one party is protected from exploitation.
- An unenforceable contract is valid but cannot be enforced due to statutory limitations or requirements.
Executed vs Executory Contracts
- An executed contract is one where all terms have been fully performed.
- An executory contract has outstanding obligations yet to be fulfilled.
Formal vs Informal Contracts
- Formal contracts require a specific form or manner of creation, while informal contracts, or simple contracts, do not have such requirements.
Types of Formal Contracts
- Four main types of formal contracts include:
- Contracts under seal
- Recognizances
- Letters of credit
- Negotiable instruments
Contract Under Seal
- A contract under seal is legally binding and does not require consideration. It is identified as such through a physical seal or designation.
Recognizance
- A recognizance is a court acknowledgment by a party agreeing to perform an act or pay a penalty for failure to perform, such as a bail bond.
Letter of Credit
- A letter of credit guarantees payment upon receiving specified documents, usually relating to the shipment of goods, and is governed by the UCC.
Negotiable Instrument
- A negotiable instrument is a signed document promising to pay a specified sum to the holder, facilitating value exchange. Common forms include checks and notes, regulated by the UCC.
Informal Contract
- An informal contract does not meet formal requirements but can be complex. They arise from agreements without mandated formalities.
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Description
These flashcards cover the classification of contracts, highlighting key distinctions such as bilateral vs unilateral and express vs implied. Understand different contract types, including valid, void, and unenforceable. Ideal for law students and legal professionals seeking to deepen their understanding of contract classification.
