lesson 9-2 quiz review. illusory promises “open ended” promises “either” party can back...

LESSON 9-2Quiz Review

ILLUSORY PROMISES

“Open ended” promises“Either” party can back out“No consideration” when created

DO ILLUSORY PROMISES HAVE CONSIDERATION?

No Consideration is needed once the promise becomes agreed to

Detriment taken on

TERMINATION CONTRACT

“1” sided illusory promise Only 1 side can end the agreement at any time

Used to get a new product sold

DETRIMENT

Taking on a responsibility that you would NOT have taken on unless a promise was made

Binds a promise

CONSIDERATION

Must be “Fair” not equalPresent in ALL binding agreements

RELEASE

Takes place once contract ends Obligations and duties end for both parties

Cannot sue because contract HAS been performed

Contract not cancelled, it ends

OUTPUT CONTRACT

Agreeing to purchase a companies TOTAL output or production

McDonalds- French fries

REQUIREMENTS CONTRACT

Agreeing to sell my product only to chosen companies

Microsoft

EXISTING DUTY

When a party negotiates something they are already supposed to do

PUBLIC VS. PRIVATE

Existing Public Duty means something is against the law and cannot be used as consideration

Existing Private Duty means something is already in the contract and cannot be used as consideration

OBLIGATION

When a party enters a contract, they must complete what they agree to

Ex) If I agree to mow your lawn for $40, I am under obligation

DUTY

Similar to obligation, as a duty is what I must do as per the agreement

Ex) If I borrow $1000 and agree to pay $100 a month, my duty is what I agree

LIQUIDATED DEBT

Parties “agree” a debt exists and to its amount

Ex) I get my car loan bill in mail and decide the amount being asked for payment is correct

UN-LIQUIDATED DEBT

Parties “Disagree” a debt exists and to its amount

Ex) I get my electric bill and know I owe something, but not the amount being asked for

ACCORD AND SATISFACTION

Agreeing to accept less than the full amount owed in exchange to cancel the rest of the debt

Promise NOT to sue

Questions?