Contract Law Overview Quiz

A legal agreement between two or more parties that creates obligations enforceable by courts.

The branch of law that governs agreements and their enforcement.

One purpose of contract law is to allow parties to exchange goods, services, or employment legally.

Another purpose of contract law is to enable parties to bind themselves to future actions, creating enforceable obligations.

Contract law helps distribute power among market participants by defining acceptable behaviors in transactions.

Finally, contract law creates certainty for market players by defining the terms and consequences of transactions.

State laws that provide the legal infrastructure to enforce contracts, ensuring reliability and trust in voluntary exchanges.

Courts use contract law to determine if a contract exists, if a party can escape a contract, how breaches are remedied, and what happens when the contract is silent on a matter.

Parties agree to exchange something of value in the future, creating a legally binding obligation.

Both parties voluntarily agree to the terms, freely negotiating without coercion or duress.

The law doesn't judge fairness of the exchange, focusing on the contract's terms and whether they were chosen freely.

A clear, objective test to see if the parties are in agreement based on their words and actions.

A clear, unambiguous match between the offer and acceptance.

To be enforceable, the contract's terms must be sufficiently specific and certain, leaving no room for ambiguity.

Parties have the legal standing to be bound by a contract. Only those parties can claim rights or responsibilities.

A situation where a contract may be canceled or modified due to factors like misrepresentation, duress, or undue influence.

The traditional view of contract law emphasized individual choice and freedom. It saw the law's role as facilitating these choices by giving them legal effect.

A shift in legal thinking recognizes that market transactions are influenced by social justice norms and governmental regulations. Contract law no longer simply empowers free agreements but also shapes and directs marketplace behavior.

Modern contract law aims to create a system that governs the distribution of wealth and power in society. It guides how resources are created and allocated.

Contract law goes beyond just enforcing agreements. It actively shapes business practices, encompassing regulations like criminal sanctions for selling dangerous goods and consumer protection laws.

Contract law creates a 'framework' for understanding the interplay between individual choices, social justice, and government control in the marketplace.

Market transactions are not isolated acts. They are often part of a larger production system called a 'firm' which involves interconnected activities.

Contract law plays a key role in determining the order of wealth and power within a society by regulating the transactions that create and distribute wealth.

The focus of contract law is shifting away from solely protecting individual choices and towards ensuring fairness and regulation in the market.

A promise made by one party (the offeror) to another party (the offeree), who can accept the offer by fulfilling the specified conditions.

When an offer is made to the entire public and acceptance is shown by fulfilling the conditions of the offer.

A statement or action that suggests an intention to enter into a contract, but lacks the necessary clarity to be binding.

A promise that is not intended to be legally binding, often used in advertisements to attract customers or create hype.

The act of agreeing to the terms of an offer, creating a legally binding contract.

Performance of an act specified in an offer is considered sufficient acceptance in a unilateral contract

An advertisement is interpreted based on how an ordinary person would understand it - Is it offering a binding deal or merely promoting a product?

An offer that is made in response to another offer, changing one or more terms. It rejects the original offer and creates a new one.

A request for clarification or information about the original offer. It doesn't propose a new deal and doesn't change the original offer.

An offer where the offeror wants the offeree to perform a specific action to accept. The acceptance happens when the act is completed.

An offer where the offeror promises something in return for a promise from the offeree. The agreement binds both parties to future actions.

Insurance contracts are often unilateral because the insurer promises a payout IF a specific event happens.

Bonus schemes in employment contracts are often unilateral because the employer promises a bonus IF the employee hits certain milestones.

Websites often present terms and conditions as a unilateral offer. Clicking 'accept' means you agree to those terms.

In a bilateral offer, the offeror makes a promise and asks for a promise in return. Both parties are bound to future actions.

An open offer is an offer that has not been accepted. This means that the person who made the offer can withdraw it at any time before it is accepted.

Silence or a failure to reject an offer does not mean the offer has been accepted. The person who received the offer must actively accept it.

An obligation can only be imposed on someone if they have agreed to it. You cannot force someone to do something they haven't agreed to.

Acceptance of an offer can be expressed through words, actions, or a pattern of behaviour. For example, if you consistently accept a similar offer from someone, it might constitute acceptance.

A complete bargain or agreement is formed when all the parties involved have communicated their acceptance of the terms.