Exam 11: Nature and Classes of Contracts: Contracting on the Internet

An option contract gives one of the parties an absolute right to enter into a second contract at a later date.

When a contract sets a price for services rendered, a plaintiff cannot sue for reasonable value.

Louise owned a house next to Robert's house. Robert made a contract with Midcity Painters to paint his house. The painters arrived to paint Robert's house, but mistakenly painted Louise's house. She saw the painters at work and made no comment. Later, Midcity Painters sent Louise a bill for painting her house. She claimed that she was not liable because she had not made any contract with them. Is this a valid defense?

In a bilateral contract, each party will be a promisor and, therefore, each party will:

A right of __________ refusal is the right of a party to meet the terms of a proposed contract before it is executed, such as a real estate purchase agreement.

The Martin family owned a home that was badly in need of repair. Mrs. Martin worked outside the home and Mr. Martin took care of the household responsibilities and cared for the two young Martin children. One day, Mrs. Martin left for work and a home repair crew drove up and began to put aluminum siding on the Martin house. Mr. Martin telephoned his wife, told her, and inquired about whether she had hired the workers. When the Martins realized that they never had ordered this work done, Mr. Martin sneaked out the back with the children. He later met his wife at work and they returned home for dinner. By that time, the entire front of the house had been aluminum-sided. The foreman asked, "Mr. and Mrs. Wolf, how do you like the job?" The Martins replied that they loved the job, but the Wolfs lived next door. When it became clear that the repair crew had made an error, the foreman insisted that the Martins had to pay. a. Decide the case, and explain the reason(s) for your decision. b. Decide the case, assuming that the Martins were away on vacation when the improvements were made, and then returned home to discover the improvements.

The law requires parties to be fair and reasonable in the making of a contract.

The promisor in a contract may also be called the:

A void contract is one that is otherwise valid but may be rejected or set aside by one of the parties.

The effect of an implied contract is not the same as the effect of an express contract.

A bilateral contract is essentially an exchange of enforceable promises.

A contract for an amount greater than $1 million must be made under seal or it is not binding.

With regard to a unilateral contract, the offeree does not accept the offer by express agreement, but rather by performance.

In some cases, third persons, such as third party beneficiaries or assignees, have rights on a contract.

Negotiable instruments are:

An agreement arises when one person, the __________, makes an offer and the other person to whom the offer is made, the __________, accepts.

When purchasing from a website, the website terms generally become the contract of the parties and are legally enforceable.

An executory contract is an agreement by which something remains to be done by one or both parties.

The subject matter of a contract may relate to:

Negotiable instruments are examples of formal contracts.