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1. What is the definition of law
a. A body of rules of conduct with legal force and effect set forth by the
government of society

2. What are the three components of the definition of “law”

a. Rules of conduct
b. With legal force and effect
c. Set forth by the government

3. What are the two sources of the law

a. Statutory law
b. Common law

4. What is statutory law

a. Laws enacted by a legislative body

5. What is a common law

a. The body of law developed from custom or judicial decisions in English and U.S.
courts

6. What is case law

a. Rules of law announced in court decisions

7. What is precedent
a. Court decision that furnished an example or authority for deciding subsequent
cases involving identical or similar facts

8. What is stare decisis

a. A doctrine of the courts under which judges are obligated to follow the
precedents established withing their jurisdictions

9. What are the five advantages of stare decisis

a. Efficiency
b. Uniformity
c. Consistency
d. Stability
e. Predictability

10. What is jurisdiction

a. The authority of a court to hear and decide a specific action

11. What are the four types of jurisdictions

a. Jurisdiction over person, property, subjects’ matter
b. Geographic jurisdiction
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12. What is the geographic limitation on a state appellate court’s jurisdiction
a. The boundary lines of that state

13. Under stare decisis is a court obligated to follow a decision from another jurisdiction
a. No, a ruling from another jurisdiction is only “persuasive authority” and not
“binding authority”

14. Under what four circumstances may a court ignore the mandate of stare decisis and
deviate from legal precedent
a. Changes in public policy
b. Particular law at issue has become illegal
c. A law is no longer just
d. Changes in society

15. What is the “supreme law of the land”

a. The US Constitution

16. What do we call a U.S. Supreme Court case in which the ruling deviates from stare
decisis
a. A landmark decision

17. What are the four general areas of law

a. Civil law
b. Criminal law
c. Administrative law
d. International law

18. What determines the area of law we will use to help remedy a legal problem
a. The outcome we desire

19. What is a lawsuit

a. A judicial proceeding for the resolution of a dispute between parties in which
rights are enforced or protected, wrongs are prevented or redressed or public
offenses are prosecuted

20. What is a class action lawsuit

a. A lawsuit in which a number of persons join together to sue one defendant for a
remedy for harm that has resulted from a single event or activity

21. What is a remedy

a. The relief given to an innocent party to enforce a right or compensate for a
wrong
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22. Generally, under what two circumstances does a lawsuit arise
a. When one party has been wronged
b. When a dispute exists

23. What is ambiguity

a. A statement in a written document (a contract, a will or a statute) that is unclear
to the extent that it has two possible interpretations

24. What is a breach

a. A failure to perform a legal obligation (also known as a legal “duty”)

25. What are the three ways that a legal obligation (or legal “duty”) is created
a. By “statutory law”
b. By “common law”
c. By the terms and conditions of a contract

26. What is a cause of action

a. A situation or state of facts that gives a person the right to initiate a lawsuit

27. What do we call the “parties” to a civil lawsuit

a. The person(s) filing the lawsuit is the plaintiff the person(s) being sued is the
defendant
b. If there is a counterclaim, the original defendant “also” becomes the “counter-
plaintiff” and the original plaintiff “also” becomes the “counter defendant”

28. List (in order) the 10 general steps that a typical civil lawsuit follows from start to finish
a. Conduct causing problem
b. The drafting of a complaint
c. The filing of the complaint
d. Service on the defendant(s)
e. Filing an answer and counterclaim
f. Filing an answer to CC
g. PT motions, PTC and Discovery
h. Perhaps ADR
i. Trial, verdict/opinion and entry of a judgement
j. Enforcement of the judgement or filing of an appeal

29. Who are the parties to an appeal

a. The person (or entity) bringing
b. The appeal is called “the appellant”
c. The person (or entity) defending against the appeal is called “the appellee”
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30. What are the two general types of remedies available to a prevailing party in a civil
‘lawsuit
a. A legal remedy (money damages)
b. An equitable remedy (such as an injunction, specific performance of a contract or
rescission of a contract)

31. Are courts of law (i.e. courts that grant legal remedies) still separate from courts of
equity that grant equitable remedies
a. No, today in most states the court of law and equity are merged and the same
court can award both legal and equitable remedies

32. Can a plaintiff seeking an equitable remedy in his lawsuit have a jury trial
a. No, only a judge can preside over an equity trial and award an equitable remedy
33. What are two types of injunctions
a. “prohibitive ” and “mandatory”
34. What are pleadings
a. The written papers drafted by the lawyers for the parties and filed with the court
in a lawsuit that detail the facts charges and defenses in a lawsuit. Pleadings
include the “complaint” the “answer” the “counterclaim” and the answer to the
“counterclaim”
35. What is contained in a civil complaint (aka a “complaint”)
a. Details concerning parties and their relationship
b. Details concerning the duty and creation of it
c. Details concerning the breach of duty
d. Details concerning the harm caused by the breach
e. Prayer for relief
36. What is the name of the official court document that is served on a defendant along
with a copy of the complaint
a. The summons
37. What two practical functions does the summons perform
a. It notifies the defendant that a lawsuit has been filed against him, her or it and
b. It notifies the defendant that he, she, or it must file an answer on or before a
specific prohibiting him, her or it from filing any pleadings or taking any actions in
his, her, or its defense
38. What is a “judgement”
a. The final order of the court (when the lawsuit has been completed) which
establishes the outcome of the lawsuit with finality. The “judgement” is the
actual document that the prevailing party can enforce to receive the remedy that
he was awarded from the lawsuit
39. Detail the activities of step one of the ten step process of a typical lawsuit
a. Some conduct occurs that is so serious and so damaging that it give rise to a
lawsuit to get a remedy in court this is called the “cause of action”
40. Detail the activities of step two of the ten step process of a typical lawsuit
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a. The person or persons (plaintiff) that have been or are the most desirous of
getting a remedy for the problem draft a written “civil complaint” (or complaint)
against the offending party or parties (defendant) usually with the help of a
lawyer because the “complaint” must be in the format required by the court
rules and must be filed before the time deadline date established by the statute
of limitations
41. Detail the activities of step three of the ten step process of a typical lawsuit
a. The original written “complaint” is filed in the appropriate court a filing fee is
paid and stamped copies of the complaint are given to the plaintiff for “service”
on the defendant(s)
42. Detail the activities of step four of the ten step process of a typical lawsuit
a. The “complaint” (along with a “summons”) is “served” upon the defendant(s) by
giving him a copy personally or mailing it to him by certified mail, it that court
permits
43. Detail the activities of step five of the ten step process of a typical lawsuit
a. The defendant(s) must then file a written “answer to the complaint” (or
“answer”) by the deadline allowed by the court rules or a “default” will be
entered in favor of the plaintiff and against the defendant
44. Detail the activities of step six of the ten step process of a typical lawsuit
a. Not often but sometimes, when the defendant(s) files his “answer to the
complaint,” he will also file a written “counterclaim” against the plaintiff telling
how the plaintiff has harmed him and what remedy he is now seeking against the
plaintiff. The plaintiff must then file an “answer to the counterclaim”
45. Detail the activities of step seven of the ten step process of a typical lawsuit
a. Before the trial of the case occurs, there will be pre-trial proceedings. These
include such things as “motions” concerning evidence or the condition of
pleadings. A pre-trial conference or conferences for the judge’s benefits and
“discovery” that is “both lawyers learning very detailed facts about the case and
the parties to prepare them for the trial”
46. Detail the activities of step eight of the ten step process of a typical lawsuit
a. At this point the judge will often send the case to alternative dispute resolution
(“ADR”) to try to settle the lawsuit without a trial
47. Detail the activities of step nine of the ten step process of a typical lawsuit
a. If the case is not settled by this time, there will be a trial (either by a judge or a
jury) and the case will be resolved by the jury’s “verdict” or the judge’s “opinion”
an appropriate “judgement” will then be entered
48. Detail the activities of step ten of the ten step process of a typical lawsuit
a. If the defendant(s) wins the case will be dismissed and a judgement of “no cause
for action” will be entered. If the plaintiff wins (even in part) a judgement in his
favor will enter for whatever remedy the verdict or opinion awarded him and he
may then “enforce” the judgement remember, however, that if either party
believes that there were errors made during the trial, he may appeal the case to
a higher court
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49. Define ethics
a. The study of what constitutes right and wrong behavior
50. Define utilitarianism
a. An approach to ethical reasoning in which an action is evaluated in terms of its
consequences for those whom it will affect a “good” action is one that results in
the greatest good for the greatest number of people
51. What is the best way a business can avoid ethical problems
a. Create and publish an office manual that specifically defines ethical behavior and
required the employees to act ethically
52. What is the best thing you can do personally in your business to assist in an ethical
operation and to help avoid ethical problems
a. Adopt Gods thinking process act on that’s thinking process thereby being an
example to others in the workplace
53. In what two ways does a court acquire jurisdiction over people (in personam
jurisdiction)
a. If the people are residents of the jurisdiction or are located there
b. If the people have sufficient contact with the jurisdiction under a “long-arm
statute”
54. What is a “long arm statute”
a. A state law that gives its state courts jurisdiction (i.e. authority) over out-of-state
defendants if the defendant has a sufficient connection with that state
55. What minimum connection must an individual have with a non-resident state to subject
it to the long-arm jurisdiction of the non-resident state and be sued for a cause of action
occurring in the non-resident state
a. It is usually sufficient for the individual to have been personally present and to
have committed a tort or to have engaged in a contractual agreement in the non-
resident state
56. What minimum connection must a business entity (e.g. a corporation) have with a non-
resident state to subject it to the long-arm jurisdiction of the non-resident state and be
sued for a cause of action occurring in the non-resident state
a. For a business entity (e.g. a corporation) it is usually enough if the business
advertises or sells its products in the non-resident state or otherwise does
business there or commits a tort there while engaged in its business activity
57. List the three types of internet contact with a non-resident state and indicate whether
the non-resident state’s “long-arm statute” would confer jurisdiction over the non-
resident internet company or person in a lawsuit in the non-resident state
a. Substantial business done over the internet (yes)
b. Some interactivity through a website (maybe)
c. Passive advertising and no interactivity (no)
58. How does a court acquire jurisdiction over property (in rem jurisdiction)
a. By virtue of the property being located in the jurisdiction
59. How does the court acquire subject matter jurisdiction
a. This must be given to the court by the constitution and the statutes of that
jurisdiction
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60. List the basic parts of the state court system
a. The state trial courts of limited jurisdiction (e.g. probate court, family court, and
small claims court)
b. The state trial courts of general jurisdiction (often called “circuit courts” or
“superior courts”)
c. Intermediate appellate courts
d. The state supreme court
61. What is a “small claims court”
a. A special inferior trial court (i.e. a court of limited jurisdiction) in which parties
litigate small claims-usually involving $2,500 or less
62. List the basic parts of the federal court system
a. Courts of limited jurisdiction (specialized courts like the federal bankruptcy court
and the court of claims)
b. Court of general jurisdiction (called the U.S. District Courts)
c. Intermediate appellate courts (called the circuit courts of appeals)
d. The U.S. Supreme Court
63. How many districts are there in the federal court system
a. 94
64. How many circuit courts of appeals are there in the federal court system
a. 13
65. What are the two kinds of civil cases that are heard in the US District Courts
a. Case involving a Federal question
b. Cases involving diversity of citizenship and in which the amount of money in
controversy is more than $75,000
66. Explain the difference between exclusive and concurrent jurisdiction
a. Exclusive jurisdiction means that only the state court system or the federal court
system has authority to hear and decide a certain cause of action between
parties
b. Concurrent jurisdiction means that a certain case can be filed and processed in
either the federal court system or the state court system
67. What is a “writ of certiorari”
a. A court order from a higher court (like the supreme court) requiring a lower
court to send the record of a case for review
68. What is “standing to sue”
a. The requirement that an individual (or entity) must have a sufficient stake in a
controversy before he, she, or it can bring a lawsuit to get a remedy
69. After a civil complaint has been filed and served on the defendant and the defendant
has filed an answer to the complaint, what are the three pretrial activities that generally
occur
a. Pretrial motions (for the parties’ benefit)
b. Pretrial conference or conferences (for the judge’s benefit)
c. Discovery (for the lawyer’s benefit)
70. What is a “motion” in a civil lawsuit
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a. A “motion” is an application made by a party to a lawsuit asking the judge to,
after a hearing on the matter, enter an immediate order (i.e. before the actual
trial) directing some act to be done in favor of the applicant
71. What are the two general categories of pre-trial motions
a. Procedural motions(e.g. motions for change of venue, motions for more definite
statement, motions to add parties, or motions to compel discovery)
b. Substantive or. “dipositive” motions (e.g. motions to dismiss, or motions for
summary judgement)
72. What is a “motion to dismiss”
a. A request made by the defendant that the court immediately dismiss the
plaintiff’s case because although the defendant admits the facts as alleged by the
plaintiff, he asserts that the plaintiff’s claim has no basis in law
73. What is a motion for summary judgement
a. A request made by the defendant that an immediate judgement be entered in his
favor because there are no disputed issues of fact that would necessitate a trial
and the plaintiff is entitles to a judgement as a matter of law
74. What happens if a defendant in a civil lawsuit gets served with the complaint and
summons but does not file an answer at all
a. A “default” will be entered against him (either by the plaintiff or by the clerk of
the court) and the defendant will be prohibited from filing any pleadings or
taking any other action in his case
75. How is a “default. judgement” entered after a default has been entered
a. If the remedy sought in the complaint is a specific amount of money, the clerk of
the court can enter the judgement for that amount automatically, without a
hearing. If the remedy sought in the complaint is not a specific amount of money
or if an equitable remedy is sought, a hearing (on a “motion” for entry of default
judgement) is scheduled and the judge enters the judgement following the
hearing
76. What is “discovery”
a. A method by which opposing parties obtain information from each other to
prepare for trial
77. What are the two most common discovery tools utilized during formal discovery
a. Interrogatories (i.e. written questions that must be answered in writing, under
oath) and
b. Depositions (i.e. oral testimony that must be given under oath in answer to
lawyer’s questions with a court recorder present to make a transcript of the
proceeding)
78. “What is a subpoena”
a. A official order compelling a person to appear, usually to give testimony at a
specific time and place, usually at a court for a trial or deposition
79. Name the three types of “alternative dispute resolution” ADR
a. Negotiation
b. Mediation
c. arbitration
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80. what is negotiation
a. A process in which the parties attempt to settle their lawsuit without going to
trial, with or without lawyers representing them
81. What is mediation
a. A method of settling disputes outside of court by using a neutral third person (or
persons) who act as a communicating agent between the parties to help them
negotiate a settlement
82. What is arbitration
a. The settling of a dispute by submitting it to a disinterested person who (after
considering the facts of the case) renders a decision
83. What is a trial
a. The final hearing in a civil lawsuit in which testimony and evidence is presented
in a courtroom and either a judge or a jury decides who wins the case and what
remedy should be awarded to the prevailing party
84. List the ten procedural steps of a civil jury trial
a. Selection of a jury
b. Plaintiff’s opening statement
c. Defendant’s opening statement
d. Presentation of plaintiff’s testimony and evidence
e. Presentation of defendant’s testimony and evidence
f. Plaintiff’s rebuttal testimony and evidence
g. Plaintiff’s closing argument
h. Defendants closing argument
i. Jury instructions
j. Jury deliberation and verdict
85. When a jury hears and decides a civil trial what do we usually call the decision that it
has arrived at when the trial is completed
a. The jury’s “verdict”
86. When a judge hears and decides a civil trial, what do we usually call the decision that he
or she arrived at when the trial is completed
a. The judge opinion
87. What are the five ways in which a judgement is typically entered
a. Following a jury verdict
b. Following a judges opinion
c. By stipulation
d. Be default
e. Following a judge’s favorable ruling on a dispositive motion
88. If after a trial, the outcome of the case is appealed to an appellate court, does the
appellate court allow testimony and evidence to be presented at the appellate hearing
in front of that court
a. No, on appeal the appellate court only considers (1) the transcript of the
proceedings at the trial court, including the testimony and evidence presented
there (2) the appellate briefs of the parties and. (3) the oral arguments of the
parties given at the appellate hearing
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89. What is the “commerce clause”
a. The provision in article 1, section 8 of the U.S. Constitution that gives congress
the power to regulate interstate commerce
90. What are police powers
a. Authority possessed by the states (as part of their inherent sovereignty) to pass
and enforce state and local laws
91. When is restriction on commercial free speech valid under the law
a. If it seeks to implement a substantial government interest
b. If it directly advances that interest
c. If it goes no further than necessary to accomplish its objective
92. What is preemption
a. A doctrine under which certain federal laws “preempt” or take precedent over
conflicting state or local laws
93. What is the “due process clause”
a. The provisions of the fifth and fourteenth amendments to the U.S. Constitution
that no person shall be deprived of Life, Liberty or Property without due process
of law
94. What is the equal protection clause
a. Provision of the fourteenth amendment to the US Constitution that guarantees
that a “state may not deny to any person within its jurisdiction the equal
protection of the law”
95. What is the logical fate of a state statute that band a corporation from making political
contributions that individuals can legally make
a. It will be held unconstitutional under the first amendment (free speech)
96. What if the federal government enacts a law regulating airports and a state enacts a law
that directly conflicts with this federal law
a. The federal law takes precedent under the doctrine of “preemption”
97. When a city wants to expand property used for a public purpose, what potential
constitutional issue does it need to deal with
a. Procedural due process
98. What are the two general types of causes of action in civil law
a. Breach of contract
b. Torts
99. What is a tort
a. Civil wrong not arising from a breach of contract
100. What is a tortfeasor
a. A person who commits a tort
101. Name six categories of torts against persons that may be experienced in a business
environment
a. Assault and battery
b. False imprisonment
c. Defamation
d. Fraud
e. Wrongful interference
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f. Failure to protect
102. Name 5 categories of torts against property that may be experienced in a business
environment
a. Trespass to land
b. Trespass to personal property
c. Conversion
d. Disparagement of property
e. Infringement
103. What are two ways in which a tort can be committed
a. Intentionally (know as an “intentional tort”)
b. Negligently (known as “negligence”)
104. What are the 4 components that are all required for a plaintiff to prevail in a tort case
a. A “duty” (i.e a legal obligation)
b. A “breach of duty” (i.e a failure to perform that legal obligation)
c. “harm” (i.e the plaintiff suffers a recognizable injury)
d. “causation” (i.e the defendants’ breach of duty caused to the plaintiffs injury)
105. What is “damages”
a. Money sought as a remedy for a breach of contract or for a tortious (wrongful)
act
106. What is liability
a. The state of being legally responsible (“liable”) for something, such as a debt or
an obligation
107. What is a defense
a. A reason offered by the defendant in an action or lawsuit as to why the plaintiff
should not recover or establish the remedy he or she seeks
108. What is defamation
a. Anything published or publicity spoken that causes injury to another’s good
name, reputation or character
109. What is privilege
a. In tort law, immunity from liability for an action that would otherwise be a tort
110. What is fraudulent misrepresentation
a. Any misrepresentation, either by misstatement or by omission of a material fact,
knowingly made with the intention of deceiving another and on which a
reasonable person would and does rely to his or her detriment
111. What is “duty of care”
a. The duty of all persons as established by tort law, to exercise a reasonable
amount of care in their dealings with others
112. What are three classifications of visitors that come onto your property
a. Business invitees
b. Social guests
c. Trespassers
113. What is a business invitee
a. A person such as a customer or a client who is invited onto business property by
the owner for business purposes
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114. In tort law what is the significance of being classified a “business invitee”
a. A higher “duty of care” is owed by the property owner to protect a business
invitee from harm than is owed to a trespasser or a social guest
115. What is “proximate cause”
a. Legal cause that exists when the connection between the act and an injury is
strong enough to justify imposing liability
116. What is comparative negligence
a. A doctrine in tort law under which the liability for injuries resulting from
negligent acts is shared by all parties who were negligent (including the injured
party) on the basis of each person’s proportionate negligence
117. What is strict liability
a. Liability regardless of fault
118. What is assumption of risk
a. A defense against negligence that can be used when the plaintiff is aware of a
danger and voluntarily assumes the risk of injury from that danger
119. What is an assault
a. Any word or action intended to make another person fearful of immediate
physical harm
120. What is a battery
a. The intentional touching of another
121. What is conversion
a. The wrongful taking, using, or retaining possession of personal property that
belongs to another
122. What three qualities must an item or a concept possess to constitute “property” in the
eyes of the law
a. It must have value
b. It must be subject to ownership
c. It must be subject to harm, damage or destruction
123. What is intellectual property
a. Property resulting from intellectual, creative processes
124. Name six types of intellectual property that need legal protection
a. Trademarks
b. Patents
c. Service marks
d. Trade names
e. Copyrights
f. Trade secrets
125. What is a trademark
a. A word, symbol, sound, or design that has become sufficiently associated with a
good or has been registered with a government agency
126. How does a person obtain protection for his trademark under the federal trademark
law (i.e The Lanham Act of 1946)
a. He or she must file an application with the U.S. Patent and Trademark Office
127. When does the tort of trademark infringement occur
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a. When one who does not own a trademark copies it to a substantial degree or
uses it in its entirety without the owner’s permission
128. When does “dilution” of a trademark occur
a. When a trademark is used without permission in a way that diminishes the
distinctive quality of the mark
129. What is a “service mark”
a. A mark used in the sale or advertising of services to distinguish the services of
one person or company from the services of others
130. What is a “trade name”
a. A name used in commercial activity to designate a particular business
131. What is a “patent”
a. A government grant that gives an inventor the exclusive right or privilege to
make, use, or sell his or her invention for a limited time period
132. What is “patent infringement”
a. A tort that occurs when a firm makes, uses, or sells, another’s patented design,
product, or process without the patent owner’s permission
133. In the area of intellectual property, what is a “license”
a. A “license” for a patent allows the use of the patented design, product, or
process for certain specified purposes to another party. It protects the patent but
avoids costly litigation
134. What is a “copyright”
a. The exclusive right of an author to publish, print or sell an intellectual production
for a statutory period
135. Name the 8 categories that an original work must fall into in order to obtain protection
under the Copyright Act
a. Literary works
b. Musical works
c. Dramatic works
d. Pantomimes and choreographic works
e. Pictorial, graphic and sculptural works
f. Motion pictures and other audiovisual works
g. Sound recordings
h. computer software
136. what remedies (or penalty) can be imposed upon a person who infringes upon a
protected copyright?
a. Payment of money damages
b. Criminal sanctions for willful infringements
137. What is an exception to copyright infringement
a. The “fair use doctrine” that says a person or entity does not have to pay royalties
for using a copyrighted work for such things as criticism, comment, news
reporting, teaching, scholarship and research
138. What was the significance of the Berne Convention of 1886?
a. All attending foreign countries agreed to honor the copyrights of the other
nations
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139. What is a “trade secret”
a. Information or a process giving a business an advantage over competitors who
do not know the information or process
140. What are “trade secrets” protected
a. Under “the Economic Espionage Act of 1996” that made the theft of trade
secrets a Federal Crime, punishable by up to 10 years in prison and up to a
$500,000.00 fine
141. What is a “domain name”
a. The series of letters and symbols used to identify site operators on the Internet;
Internet addresses
142. What is the significance of establishing a “domain name”
a. Because of the restrictive features of domain names, the courts have held that
the unauthorized use of another’s mark in a domain name constitutes trademark
infringement if it might cause customer confusion
143. What is “cybersquatting”
a. The act of registering a domain name that is the same as, or confusingly similar
to, the trademark of another and then offering to sell that domain name back to
the owner
144. What is a “contract”
a. An agreement that can be enforced in court
145. Name the five basic requirements for a valid contract
a. Agreement (offer+acceptance)
b. Consideration (mutuality of obligation)
c. Capacity
d. Legality
e. Form
146. The primary goal in drafting any contract is that it be_______
a. Enforceable
147. What is an “offeror”
a. A person (or legal entity) that makes an offer to enter into a contract
148. What is an “offeree”
a. A person(or legal entity) to whom an offer is made
149. What is a “bilateral contract”
a. A contract that includes the exchange of a promise for a promise
150. What is a “unilateral contract”
a. A contract that includes the exchange of a promise for an act
151. What is an “express contract”
a. A contract that is stated in words (oral or written)
152. What is an “implied contract”
a. A contract formed in whole or in part from the conduct of the parties
153. What is a “quasi contract”
a. An obligation or contract imposed by law, in the absence of an actual agreement,
to prevent “unjust enrichment”
154. What is “promissory estoppel”
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a. A doctrine that can be used to enforce a promise when the promise has
justifiably relied on it, and justice will be better served by enforcing it
155. Under what basic remedy can the “quasi contract” doctrine and the doctrine of
“promissory estoppel” be imposed?
a. Equity
156. What is a “formal contract”
a. A contract that by law required a specific form for its validity
157. What is in “informal contract”
a. A contract that does not require a specific form for its validity
158. What is an “executed contract”
a. A contract that has been completely performed
159. What is an “executory contract”
a. A contract that has not yet been fully performed
160. What is a “valid contract”
a. A properly constituted contract having legal strength or force
161. What is a “voidable contract”
a. A contract that may be legally avoided at the option of one of the parties
162. What is an “unenforceable contract”
a. A contract having no legal effect because of a statute or rule of law (even though
it might appear on its face to be a valid contract).
163. What is a “void contract”
a. A contract having no legal force or binding effect
164. What is an “E-contract”
a. A contract entered into online
165. What is an agreement
a. A meeting of two or more minds in regard to the terms of a contract (i.e. an offer
and an acceptance)
166. What is an “offer”
a. A promise or commitment to perform or refrain from performing some specified
act in the future
167. What is a “revocation”
a. In contract law, the withdrawal of an offer by the offeror. Unless the offer is
irrevocable, it can be revoked at any time before acceptance without liability
168. What is an “option contract”
a. A contract under which the offeror cannot revoke his offeror for a stipulated
period of time and the offeree can accept or reject the offer during this time.
169. What is a “counteroffer”
a. An offeree’s response to an offer in which the offeree rejects the original offer
and at the same time makes a new offer
170. What is an “acceptance”
a. A voluntary act by the offeree that shows assent, or agreement, to the terms of
the offer
171. What are the three requirements for a valid acceptance of an offer
a. The offer must be accepted by the offeree (not by a third party)
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b. The acceptance must be unequivocal
c. In most situations, the acceptance must be communicated to the offeror
172. What is the “mailbox rule”
a. A rule providing that an acceptance of an offer becomes effective on dispatch
173. What is a “click-on agreement”
a. An agreement entered into online when a buyer indicated his or her acceptance
of an offer by clicking on a button that reads “I agree”

174. What is “consideration”

a. The value given in return for a promise or performance in a contractual
agreement
175. What are the two elements of “consideration”
a. It must have legally sufficient value
b. It must be part of a “bargained-for” exchange
176. List eight types of objects or concepts that are of “sufficient legal value” to constitute
“consideration” and are often exchanged in business contracts
a. Money
b. Goods
c. Products
d. Personal property
e. Land
f. Intellectual property
g. Services
h. Forbearance (e.g. A promise not to do something)
177. What are two types of promises that the law has determined do not have value and,
therefore, do not constitute valid consideration
a. A promise to do what one already has a legal obligation to do
b. A promise in return for actions or events that have already taken place (“past
consideration”)
178. What is “recission”
a. An equitable remedy by which a contract is terminated and the parties are
returned to the positions they occupied before the contract was made
179. What is “specific performance”
a. An equitable remedy in which the court (rather than awarding money for
damages for a breach of contract) orders the parties to perform the contract
exactly according to its terms
180. What is an “illusory promise”
a. A promise that is so uncertain as to what the terms of the promise is that the
promisor has not definitely promised to do anything. Such a promise is
unenforceable because it does not have any value and, therefore, does not
constitute “consideration”
181. What is an “accord and satisfaction”
a. The settling of a claim by the debtor offering to pay less than the creditor claims
to be owed, when some dispute arises concerning the actual amount still owed
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182. What is a “release”
a. An agreement in which one party gives up the right to pursue a legal claim
against another party
183. What are the four functions of the court in any civil lawsuit when “breach of contract”
is the cause of action
a. To determine if there was a contract between the parties
b. To determine what the terms and conditions of the contract were
c. To determine if there was a breach
d. To determine the amount of damages(or the appropriate equitable remedy) to
solve the problem caused by the breach
184. What are the three general categories of people that contract law deals with
concerning the issue of capacity
a. Minor children
b. Intoxicated persons
c. Mental incompetents
185. What is the legal term used when a minor avoids (either during the course of his
minority, or for a reasonable time after turning 18) a contract he entered into as a
minor?
a. A “disaffirmance”
186. When can a minor disaffirm a contract
a. During his or her minority or within a reasonable time after attaining majority
187. What is the most notable consequence when a minor disaffirms a contract
a. Whatever the minor transferred as consideration (or its value) normally must be
returned
188. What is the effect of “emancipation” on a minor’s capacity
a. When a minor child is fully emancipated, his parents relinquish control, and the
child assumes full contractual capacity and loses the right to disaffirm.
189. What is “the duty of restitution”
a. The duty imposed on a minor who disaffirms a contract to return whatever goods
he received or to pay for their reasonable use (not re-required in all states-see
page 133)
190. What is “ratification”
a. The act of accepting and giving legal force to an obligation that previously was
not enforceable
191. What is the status of a contract made with an incompetent person?
a. If the person has been determined incompetent by a court, the contract is void. If
the person has not been determined incompetent by a court, the contract is
either voidable or valid, a court would have to determine the incompetent
person’s condition at the time the contract was entered into
192. What is the status of a contract made with an intoxicated person
a. It is either valid or voidable (by the intoxicated person) depending on the
circumstances. But for the contract to be voidable, the intoxicated person must
prove that, because of his intoxication, his reason and judgment were impaired
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to the extent that he or she did not comprehend the legal consequences of
entering into the contract
193. In addition to contracts to do something that is prohibited by federal or state law, what
other kinds of contracts will not meet the essential element of “legality”?
a. Contracts that are “contrary to public policy” such as a contract to commit an
immoral act (like selling a child), or a contract that prohibits marriage
194. What is “usury”?
a. The charging of an illegal rate of interest
195. What is “reformation”?
a. A court ordered correction of a written contract so that it reflects the true
intention of the parties
196. What is an “unconscionable” contract or clause?
a. A contract or clause that is void because one party is forced to accept terms that
are unfairly burdensome and that unfairly benefit the other party
197. What is an “adhesion contract”?
a. A standard form contract in which the stronger party dictates the terms
198. Are covenants (contracts) not to compete generally enforceable?
a. No. generally, they are against public policy
199. When can a covenant not to compete be enforceable
a. A covenant not to compete can be enforceable when
i. The specified period of time is not excessive in duration and
ii. The geographic restriction is “reasonable”

200. What is an “exculpatory clause”

a. A clause that releases a party to a contract from his or her wrongful acts. (they
are generally held to be unenforceable)
201. How is the concept of “lack of voluntary consent” used in a business contract lawsuit
a. As a defense in a lawsuit to enforce a contract, because an otherwise valid
contract will be unenforceable if the parties have not genuinely agreed to the
terms
202. What is a “unilateral mistake”
a. A mistake that occurs when one party to a contract is mistaken as to a material
fact
203. What is the effect of a unilateral mistake
a. In general, a unilateral mistake does not give the mistaken party the right to relief
from the contract
204. What is a “bilateral mistake”
a. A mistake that occurs when both parties to a contract are mistake as to a
material fact
205. What is the effect of a “bilateral mistake”
a. When both parties are mistaken about some material fact, the contract can be
rescinded by either party
206. what is one exception to the rule that either party will be granted rescission to a
contract when there has been a bilateral mistake as to some material fact?
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a. if the mutual mistake concerned strictly the value of the object of the contract,
the contract will be enforced and is not subject to rescission
207. What is “fraudulent misrepresentation”
a. Any misrepresentation, either by misstatement or by omission, of a material fact,
knowingly made with the intention of deceiving another and on which a
reasonable person would, and does, rely to his or her detriment
208. What are the four elements that typically have to be present for a party to a contract to
either rescind the contract or enforce it and sue for damages under a theory of
fraudulent misrepresentation?
a. Misrepresentation of a material fact
b. An intent to deceive
c. The innocent party justifiably relies on the misrepresentation
d. The innocent party suffers some kind of harm
209. Define “scienter”
a. A party’s knowledge that material facts have been falsely represented with an
intent to deceive
210. What is “undue influence”
a. Persuasion that is less than actual force but more than advice and that induces a
person to act according to the will or purposed of the dominating party
211. What is the “statute of frauds”
a. A statute that lists the types of contracts that must be in writing to be
enforceable
212. What are the five categories of contracts that must be in writing to be enforceable
a. Contracts involving interests in land
b. Contracts that cannot by their terms be performed within one year from the day
after the contract’s formation
c. Collateral contracts, such as promises to answer for the debt of another
d. Promises made in consideration of marriage
e. Contracts for the sale of goods in the amount of $500 or more (under the UCC)
213. What is a “fixture”
a. Personal property that is attached to real property in such a way that it has
become part of the real property
214. What is “prenuptial agreement”
a. An agreement entered into in contemplation of marriage, specifying the rights
and ownership of the parties’ property
215. If a contract has to be in writing to be enforceable, what will satisfy the “writing”
requirement?
a. Any written memorandum (including invoices, sales slips, checks, or e-mails) that
confirms that a contract exists, and
b. Established the essential terms of the contract and
c. Includes the signature (even e-signature) of the party to be bound
216. What is the “parol evidence rule”
a. A rule of contracts under which a court will not receive into evidence oral
testimony that contradicts the unambiguous terms of a written agreement
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217. What is “privity of contract”
a. The relationship that exists between the promisor and the promise of a contract

Last card
218. What is an “assignment”
a. The act of transferring to another all, or part, of one’s rights arising under a
contract
219. When rights under a contract are assigned, what becomes he rights of the assignor
a. The rights of the assignor are extinguished and the assignee acquired the right to
demand performance
220. What are the four circumstances under which contractual rights cannot be assigned
a. When a statute prohibits it
b. When the contract is personal in nature
c. When the assignment changes the duty or the risk
d. When the contract prohibits assignment
221. What is a delegation
a. The transfer of a contractual duty to a third party
222. What are the three contractual duties that cannot be delegated
223. What is the effect of a contract that assigns “all rights”
a. Generally, it is treated as both an assignment of all rights in a contract and the
delegation of all duties to a contract
224. What is a “third party beneficiary”
a. One who is not a party to a contract but for whose benefit a promise is made in
the contract
225. What are the two types of third-party beneficiaries
a. “intended beneficiaries” (for whose benefit a contract is formed)
b. “Incidentally beneficiaries” (who incidentally benefit from a contract)
226. What is the big difference between intended beneficiaries and incidental beneficiaries
a. Intended beneficiaries can sue the promisor if the contract is breached.
Incidental beneficiaries have no rights in a contract and cannot sue the promisor
if it is breached.
227. List five ways by which a contractual obligation (or “duty”) can be “discharged” (or
terminated)
a. Performance
b. Rescission
c. Agreement (or “stipulation”)
d. Novation
e. Accord and satisfaction
228. What is the most common way to “discharge” (or terminate) a contractual obligation
(or “duty”)
a. By “performance” or fulfillment of the contractual duty
229. In addition to "performance," what is another common way that contractual obligations
(or duties) are terminated?
a. By mutual agreement of the parties to “rescind” the contract
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230. What is “restitution”
a. Typically, when a contract is "rescinded" (either by the parties or by court order)
all money, goods, property (or the value thereof) conveyed under the contract is
returned to the original owner, so as to put the parties back in the position they
were in before the contract was entered into.
231. What is a “novation”
a. The substitution, by agreement, of a new contract for an old one, with the rights
under the old one being terminated and replaced by those in the new one
232. What are the three types of money damages that can be awarded in breach of contract
cases
a. Compensatory damages
b. Consequential damaged
c. Punitive damages
233. What are “compensatory damages”
a. A money award, given by a judge or a jury at the conclusion of a trial, which is
the equivalent to the actual value of injuries or damages sustained by the
aggrieved party in a civil lawsuit
234. What are “consequential damages”
a. Special damages that compensate for a loss that is not direct or immediate
235. What are “punitive damages”
a. Compensation in excess of actual or consequential damages awarded to punish
the wrongdoer. (these damages are no longer recoverable in most states)
236. What are the two major tools that a plaintiff can use to enforce a judgement for money
damages in step 10 of the civil lawsuit process
a. A writ of garnishment (a court order to seize liquid assets)
b. A writ of attachment (a court order to seize tangible personal property or land to
sell at public auction)
237. List six types of equitable remedies that could be available to remedy your business
problem
a. An injunction (prohibitive or mandatory)
b. Quasi contract
c. Promissory estoppel
d. Recission
e. Reformation
f. Specific performance
238. What are three major considerations for establishing a business “entity” for your
business
a. Liability considerations
b. Tax considerations
c. Perpetuation of the business