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2nd test business law


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A binding agreemen in which each pary has made a promise to the other
bilateral contract
In contract law, something of legal value that has been bargained for and given in exchange by the parties.
A contract is a legally enforceable _______
The act of notifying the other party to a contract that the party giving the notice refuses to be bound by the agreement.
exculpatory clause is
A contract provision that attempts to release one party from liability in the event the other party is injured
A ______contract is a binding agreemen in which all parties obligations are fulfilled
executed contract
An executory contract is a binding agreement in which ________
one or more of the parties has not fullfilled its obligations
express contract

A binding agreement in which the parties explicitly state all important terms.
express contract
An apparent promise that is unenforceable because the promisor makes no firm commitment.
illusory promise
A binding agreement created not by explicit language but by the informal words and conduct of the parties
implied contract
Misrepresentation is a factually a) correct or b) incorrect statement made during contract negotiations
The _______recieves the first offer
The ______makes the first offer
A doctrine in which a court may enforce a promise made by the defendant even when there is no contract, if the defendant knew that the plaintiff was likely to rely on the promise, the plaintiff did in fact rely, and enforcement of it is the only way to a
promissory estoppel
"As much as she deserves"
quantum meruit
A legal fiction in which, to avoid injustice, the court awards damages as if a contract had existed, although one did not.
To rescind a contract means to ________it
Restitution is _______
restoring an injured party to its original postion
An agreement that a court refuses to enforce because it is fundamentally unfair as a result of unequal bargaining power by one party.
unconscionable contract
A binding agreement in which one party has made an offer that the other can accept only by action, not words.
Unilateral contract
An agreement that neither party may legally enforce, usually because the purpose of the bargain was illegal or because one of the parties lacked capacity to make it.
void agreement
An agreement that, because of some defect, may be terminated by one party, such as a minor, but not by both parties.
Voidable contract
a check is
An instrument in which the drawer orders the drawee bank to pay money to the payee.
Instruments such as checks and promissory notes that contain a promise to pay money, includes both negotiable and non-negotiable instruments.
commercial paper
A disclaimer is a statment that
a particular warranty does not apply
a drawee
The person who pays a draft. In the case of a check, the bank is the drawee.
a drawer is the person who
issues the draft
A guarantee, created by the words or actions of the seller, that goods will meet certain standards.
express warranty
A holder in due course is someons who has given value for an instrument, in good faith, without _______
notice of outstanding claims or other defenses
Guarantees created by the Uniform Commercial Code and imposed on the seller of goods
implied warranty
The maker of a promissory note or the drawer of draft
The issuer of a promisory note
An unconditional written promise that the maker of the instrument will pay a specific amount of money on demand or at a definite time. Typically payable w/in five years for a large corporation (short term debt)
A payee is someone who
is owed money under the terms of an instrument
Potential responsibility that the manufacturer or seller has for injuries caused by defective goods
product liablilty
The maker of the instrument promises to pay a specific amount of money
Promissory note
A guarantee that goods meet certain standars
A situation in which conduct of a principal causes a third party to believe that the principal consents to have an act done on his behalf by a person purporting to act for him when, in fact, that person is not acting for the principal
apparent authority
Damages include 1)the harm that a plaintiff complains of at trial such as an injury to her person or money lost because of a contract breach and 2)
Money awarded by a trial court for injury suffered
express authority
Conduct of a principal that, reasonably interpreted, causes the agent to believe that the principal desires him to do a specific act.
An obligation to behave in a trustworthy and confidential fashion toward the object of that duty
fiduciary duty
A principal directs an agent to undertake a transaction, the agent has the right to do acts taht are incidental to it, usually accompany it, or are reasonably necessary to accomplish it
implied authority
A promise to pay someon elses obligations
An independent contractor
undertakes tasks for others and whose work is not closely controlled
If the third party in an agency relationship knows that the agent is acting for a principal, but does not know the identity of the principal, that principal is __________disclosed
In an agency relationship, the _______is the person for whom the agent is acting
An agent whose work is closedly controlled by the principal
If a third party in an agency relationship does not know that the agent is acting for a principal, that principal is undisclosed.
undisclosed principal
A plan introduced in a workplace for the purpose of either remedying the effects of past discrimination or achieving equitable representation of minorities and women.
affirmative action
bona fide occupational qualification is a job requirement that would otherwise be _________is permitted in situations in which it is essential to the position in question
A worker whose job doesn't have a specific duration
employee at will
A fact or conclusion that is presumed to be true unless someone presents evidence to disprove it
prima facie
Someone who discloses wrongful behavior
Stock publicly not traded and small number of shareholders
close corporation
Commercial improacticabliity is after the creation of the contract, and an entirely unforseen event occurs which makes enforcement of the contract extraordinarily ________
When a partner leaves a partnership
After creation of contract, unforseen event occurse that _______
eliminates the value of the contract for one of the parties
Relativily minor costs, such as storage and advertising, that the injured party suffered when responding to the contract breach
incidental damages
Partnership for a limited purpose
joint venture
the general partner is not personally liable for the debts of the partnership
limited liability liimited partnership
2 types of partners...1)limited partners who have no personal liablity for the debts of the tnerprise nor any right to manage the business, and 2) general partners who are responsible for management and personally liabl for all debts
limited partnership
An association of two plus to carry on as co owners of a business for profit
a partnership _____ is a partnership that has no fixed duration. Each partner has the right to resign from the parnership at any time
at will
Partnership _________ is one of which a person who implies he is a partner or doesn't object when other ppl imply it, he is liable as if her really were a partner
partnership by stoppel
A form of organization that permits professionals to incorporate. Shareholders are not personally liable for torts of shareholders or for the contract debts of the organization
Professional corporation
A sole proprietorship is
an inincorporated business owned by a single person
Term Partnership is when partners agree in advance about the _______of the contract
An annuel report lets the ______know about detailed financial data
An authorized and issued stock is one that has been approved by the corporation's charter and _________
subsequently sold
Stock that has been approved by the corporation's charter, but has not yet been sold
authorized unissues stock
Bonds are long term debts _________
secured by some of the issuin company's assetts
A common law rule that protects managers from liability if they are acting without a conflict of interest, and make informed decisions that have a rational business purpose.
Business judgement rule
A document that specifies the organizational rules of a corporation or other organization, such as the date of the annual meeting and the required number of directors
Certificates that reflect ownership in a corporation. Owners of this equity security are last in line for corporate pay outs such as dividends and liquidation proceeds
common stock
Debentures are
long term, unsecured debt, typically issued byuy a corporation
A corporation is ____ in the state in which it was formed
a corporation is ____if formed in another state
person who creates a corporation by raising capital and undertaking the legal steps necessary for formation
A proxy is a person whom the shareholder designates to vote in his place, or a
written form that the shareholder uses to appoint a designated voter
When a public company seeks proxy votes from its shareholders, it must include a __________. This statement contains information about the company, such as a detailed description of management compensation.
proxy statement
a quorum is
the number of voters that must be present for a meeting count
anyone who is affected by the activities of a corporation such as employees, customers, creditors, suppliers, shareholders, and neighbors.
A treasury stock is one of which
has been bought back by its issuing corportion
Records of shareholder meetings and directors meetings are kept in the corporation's _____book
Owners of _______stocks have a right to recieve dividents and liquidation proceeds of the companly before common shareholders
preferred stock

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