CHAPTER 23--CONTRACTS

Basic Concepts  Definition—agreement between two or more persons to exchange something of value  If someone fails to perform duties, it is said to be a breach of contract  Examples from your life?

Elements of Contracts  Offer  Must be specific to an individual (advertisements are solicitations for offers … offer occurs when you place an order)  Acceptance  Can be by agreement to perform or performance  What about rewards?

Elements of Contracts  Consideration—something of value  Examples of consideration?  Mental capacity to contract (sound mind/age)  Legal object (drug sales, prostitution)  What about gambling contracts?  Can minors make contracts?

Oral Contracts  Many oral agreements are enforceable  Three big exceptions:  Real estate  Contracts not performable within one year  Contracts for sale of goods $500 or more  This is called the statute of frauds  Why are written contracts almost always preferable?  What is an unconscionable contract?

Fraud  A false statement about an important fact that is made to induce a person to agree to a contract  Can also be based on making a promise without a present intent to perform the contract

Check for Understanding  Complete the online Chapter Quiz for Chapter 23   Turn in for class participation credit