Exam (elaborations)
COMM 315 Midterm 2 – Notes Business Law and Ethics (Concordia University)
- Course
- COMM 315
- Institution
- Concordia University ( )
COMM 315 Midterm 2 – Notes Business Law and Ethics (Concordia University)
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lOMoAR cPSD| 6353920COMM 315 Midterm 2 – Notes
Business Law and Ethics
(Concordia University)
, lOMoAR cPSD| 6353920
Chapter 4
Contracts: business agreements that people enter into voluntarily
→ contracts create obligations
3 Basic Requirements for an obligation to exist:
1. Must be at least 2 parties who agree to do something for each other
2. Must be a prestation that is the object of the obligation
3. Must be a lawful reason for undertaking the obligation
→ prestation: a payment or performance; the rendering of a service; doing or not doing
something
2 ways obligations come into existence:
1. Commonly emerge from contracts (verbal or written but some must be, by law,
written such as marriage contracts) → express
2. From an act carried out by someone → tacit
There are “legal” obligations where if you do not carry the obligation you will be liable
for damages or the performance
There are also “natural” obligations where you are bound consciously only
Contracts: an agreement between two or more persons which establishes legal
obligations
• A bilateral agreement (since obligations operate in both directions)
• General provisions of the Civil Code are used if the clauses don’t provide a
solution
CLASSIFICATIONS OF CONTRACTS: (the pairs of 2 contracts are mutually
exclusive from each other)
Contract of Adhesion: take it or leave it contract, not open to negotiation; conditions
are drawn up by one party and the choice of the other party is to accept or deny to enter
the contract
Contracts of Mutual Agreements: both parties discuss and agree on all of the
conditions of the contract
Bilateral (Synallagmatic) Contracts: both parties have agreed to perform an
obligation
Unilateral Contracts: only one party undertakes to perform an obligation (ex: pledge to
donate)
Onerous Contracts: each party receives something in return for undertaking an
obligation (often involves money)
Gratuitous Contracts: one party undertakes an obligation that benefits the other party,
but the second party does nothing for the first person (often does not involve money)
, lOMoAR cPSD| 6353920
Commutative Contracts: both parties know in detail how much each has to pay, and
what each will receive (you know the full extent of your obligations from the beginning)
Aleatory Contracts: the full extent of the obligations is uncertain at the time the
contract is entered into and will only be established at a later date
Contracts of Instantaneous Performance: there is a one time discharge of the
obligations undertaken (perform the prestation)
Contracts of Successive Performance: the obligation is to continue doing something
on a regular basis for a specific time period
Consumer Contracts: a natural person (not a business) acquires, for personal use,
some property or service from a business that offers such property or service to the
public
OFFER AND ACCEPTANCE
Contracts: agreements that people enter into voluntarily
Consensus in Idem: both parties clearly understand their obligations and willingly
undertake to discharge them
Negotiation: one party makes an offer and the other accepts it
→ once an agreement is made the contract comes into existence
Offer: a clear, precise, firm proposition containing a genuine intention to enter into a
binding contract
→ once acceptance of the obligations occurs, the contract is made
→ the acceptance has to be made in the same terms as the offer (i.e. you can’t accept
the offer and then say you’d like to pay less though - that would be a counter offer)
Process:
→ Offer is made
→ Negotiation/ Counteroffer Occurs
→ Acceptance
→ Contract is formed
Article 1385 (Conditions of formation of contracts): states the essential elements
required for the formation of a valid contract
→ this determines if a contract is valid or not
Article 1386 (Exchange): The exchange of consents between the parties to a contract
may be express or tacit
→ Express: when there is a clear indication on the part of the person
→ Tacit: when nothing is said, but the person carries out some action to indicate the
acceptance
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