Question

Chapter 11

1) A contract is defined as a promise creating legal obligations of performance.

a) The four elements of a valid contract are best remembered by using the pneumonic CLAC. What does CLAC stand for?

b) How many parties are required for a valid contract?

c) How many promises are required for a valid contract?

d) At what point is a unilateral contract formed? A bilateral contract?

e) Compare an express contract with an implied contract

f) What is the difference between and executed contract and an executory contract?

f) If a contract term could be interpereted in two different ways (is ambiguous) in which

party's favor will the court decide ?

Answer 1

a. One of the possible combinations under CLAC can be:

C-Capacity of Parties

L-Legality of Subject Matter

A-Acceptance of offer

This might not be the exact combination you are looking for as there is not set answer available for this. This might be just for learning purpose used by a small group.

b. 2 parties are required for a valid contract

c. 2 promises are required for a contract; promise for performance for both the parties

d. Unilateral contract is one which can be accepted only through performance. Hence it is formed through performance. Bilateral contract is formed through counter promises.

e. “An executed contract is one in which the promises are made and completed immediately, like in the purchase of a product or service. On the other hand, an executory contract means that the promises of the contract are not fully performed immediately.”

f. The court will go through all the evidences and the most important aspect will the parties’ intent behind the contract. Court will make decision on the basis of the intent of parties.