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LAW 122 (625)
Chapter 7

Chapter 7 - The Nature & Creation of Contracts (LAW 122)

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Department
Law and Business
Course
LAW 122
Professor
Andre Serero
Semester
Summer

Description
-contract is an agreement that creates rights and obligations that can be enforced in law -you and the other person entered into an agreement that contained legally enforceable rights and obligations -meeting of the minds – shared decision to enter into a legal transaction on a particular basis -exchange in value – when both parties each give up something -every contract actually requires a number of distinct steps or elements, 3 important ones; -the parties must have an intention to create legal relations -they must reach a mutual agreement through the process of offer and acceptance -they must enter into a bargain by each giving consideration Intention to Create Legal Relations -contract will not arise without an intention to create legal relations -intention to create legal relations  arises if a reasonable person would believe that the parties intended to create a legally enforceable agreement -judge is concerned with what a reasonable person would have thought not what the parties themselves actually thought because; -a test of subjective intentions would be difficult to apply because a person could easily lie at trail -the law of contracts aim is to protect reasonable expectations Offer The Nature of an Offer -parties must enter into a mutual agreement through the process of offer and acceptance -offer indication of a willingness to enter into a contract on certain terms. -offeror person who offers to enter into a contract -offereeperson who receives an offer -contract comes to existence as soon as an offer is accepted. Both parties become obligated to fulfill the promises contained in the agreement. Once a contract comes into existence, neither party, acting alone, can alter its contents or bring it to an end. Invitation to Treat -invitation to treatnot an offer but an indication of willingness to receive an offer; basically an invitation for others to make offers -eg; if your ad is classified as an invitation to treat, each response is an offer, which you are free to accept or reject Communication of an Offer -a statement is not an offer unless it is communicated and received as an offer The Life of an Offer -offer doesn’t last forever; may cease to exist in a variety of ways; -revocation -lapse of time -death or insanity -rejection -counter offer Revocation -occurs if they party who made an offer withdraws it. -the offeror is the master of the offer and is generally entitled to revoke it at any time -revocation is not effective unless its reasonably communicated to the offeree -2 types of revocation -firm offers -tenders Firm Offers -oc
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