Questions and Answers
What is an Express Contract?
What defines an Implied Contract?
A Bilateral Contract involves:
What is a Unilateral Contract?
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What is forbearance?
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A contract is ___ if it meets all requirements of law.
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What does voidable mean?
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What does void mean?
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What is an unenforceable contract?
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What are Competent Parties?
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What constitutes Mutual Agreement?
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What is Fraud in contract law?
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What is Innocent Misrepresentation?
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What denotes a Mistake in contract negotiations?
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What is Contractual Intent?
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What is Duress in the context of contracts?
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What is a Lawful Objective in contract law?
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What does Consideration refer to in contracts?
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What is Valuable Consideration?
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What is Good Consideration?
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Why must contracts related to the sale of land be in writing?
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What is an Assignment in contract law?
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What is Novation?
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What is Mutual Rescission?
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What is an Unlawful Objective in contract law?
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Study Notes
Types of Contracts
- Express Contract: Formed through clearly stated intentions either verbally or in writing, such as leases or real estate sales.
- Implied Contract: Established through the actions of the parties involved, for example, ordering food at a restaurant implies a payment obligation.
- Bilateral Contract: Involves mutual promises, where one party does something in exchange for the other party doing something else, common in real estate transactions.
- Unilateral Contract: Involves a promise in exchange for a specific performance, such as a listing agreement where the seller pays a commission if a buyer is found.
Contract Validity
- Valid Contract: Meets all legal requirements; binding and enforceable in court.
- Voidable Contract: Binding on one party but can be canceled by the other party.
- Void Contract: Completely unenforceable and not recognized by law.
- Unenforceable Contract: Once valid but no longer enforceable for specific reasons.
Competent Parties
- Legal age requirement is typically 18 (19 in Alabama).
- Parties must not be intoxicated or declared mentally incompetent by a court.
- A power of attorney allows one person to act on another's behalf.
- Corporations are competent if documents are properly executed.
Mutual Agreement Elements
- Both parties must accept terms, evidenced by offer and acceptance.
- Changes to the original offer create a counteroffer.
- No agreement if fraud, innocent misrepresentation, or duress is present.
Misrepresentation and Fraud
- Fraud: Deliberate deceit or failure to disclose important info allows the wronged party to rescind the contract.
- Innocent Misrepresentation: Unintentional deception permitting rescission, but not mandatory.
Other Contract Considerations
- Mistake: Can involve ambiguity or a material fact change affecting negotiations.
- Contractual Intent: Essential for enforcing agreements; jokes lack enforcement intent.
- Duress: Coercive threats prevent a fair meeting of the minds.
Legal Objectives
- Contracts must be for legal purposes, as courts won’t enforce illegal agreements.
Consideration Types
- Consideration: Value exchanged in contracts, such as money for property title.
- Valuable Consideration: Includes money or valuable services.
- Good Consideration: Involves gifts made out of affection.
Writing Requirements
- In Writing: Contracts for land must be written according to the Statute of Frauds; similar requirements exist for personal property over $500.
Contract Assignment and Novation
- Assignment: Rights or obligations can be transferred, but the original party remains liable.
- Novation: Involves replacing an existing contract or adding/removing parties.
Contract Cancellation
- Mutual Rescission: Both parties voluntarily agree to cancel an ongoing contract.
Unlawful Objective
- Contracts become void if their purpose becomes illegal.
Impact of Death
- Certain contracts may be affected by the death of a party, depending on the contract nature and terms.
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Description
Test your knowledge on key concepts from Real Estate Chapter 6 with these flashcards. Learn about different types of contracts such as express, implied, and bilateral contracts through clear definitions and examples. Perfect for students preparing for exams in real estate education.