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Contract Law

Contract Law. Requirements: Meeting of the Minds Offer —a conditional promise Acceptance —made by the party to whom the offer was made Consideration —an exchange of value, such as money Legality —underlying bargain must be legal

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Contract Law

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  1. Contract Law Requirements: Meeting of the Minds Offer —a conditional promise Acceptance —made by the party to whom the offer was made Consideration —an exchange of value, such as money Legality —underlying bargain must be legal Capacity —ability to understand one's acts (minors cannot enter into contracts) Precision —specificity of terms

  2. Definition • A legally enforceable agreement (may be oral or written) between two or more parties that is enforceable under law that creates an obligation to do or not to do a particular action. • Establishes the rights and obligations of the contracting parties.

  3. Contracts Types of Contracts: Goods Services

  4. Contract Law • The Statute of Frauds requires that goods over $500 be in writing.

  5. Contract for Personal Goods • UCC: Uniform Commercial Code • A uniform set of rules for merchants and buyer. • Buyer: Implied warranty- product is acceptable by normal standards within the trade. Implied warranty for fitness for a particular purpose: Implied means you don’t need a warranty (even if seller says sale is made w/o any warranties expressed or implied.

  6. Product Liability • When use results in… Personal Injury Property Damage

  7. Product Liability • How is recovery made? In design, manufacture, testing, inspection,packaging and label so the product is safe for the ordinary customer. Negligence Strict Liability Three elements: 1. Product had defect dangerous to a person’s property. 2. Defects exists at time of sale. 3. Defect caused an injury. Breach of Warranty Does not perform as expressed or implied

  8. Product Liability If you misuse the product you void the warranty.

  9. Contracts for Personal Services • Negotiated by bargaining unit not individual.

  10. Breach of Contract • Breach of contract —failure to perform a duty imposed under a contract. When one party fails to fulfill the promises made in the agreement. Once a breach occurs you can sue.

  11. Types of Breaches • Material: or total breach excuses the injured party from their contractual obligations and exposes the offending party to a breach of contract lawsuit.

  12. Types of Breaches • Immaterial: a partial breach occurring when one party fails to fulfill the promises made in the agreement. This type of breach usually does not affect the remainder of the contract. • Example. The sporting goods you ordered were to be shipped by UPS. Instead they were changed to FedEx.

  13. Remedies for Breaches Pay Damages by: • Perform a specific performance • Injunction- requires party to perform an act or prohibits them form performing an act. • Rescission • Cancels contract, restoring all parties to their original position. • Reformation • A court modifies or revises a contract, deed, or other written instrument to make it conform to what the parties understood or agreed to.

  14. Justifiable Breach • Immorality • Insubordination • Incompetence • The three “I’s” must be connected to the job.

  15. Contract Termination • Salary • Bonus if complete contract • Perks/outside income • Cars, • Housing • Shoe contracts

  16. Liquidated Damages Clause • If none in contract then employee must sue. Otherwise the contract would stipulate that upon release: • Can or can’t take job for competing company • Bonus paid or not at termination

  17. Managerial Guidelines • Put it in writing. • Get the advice of a lawyer. • The greater the value of the goods or services the more you should consider legal counsel. • Clearly identify all relevant items and issues. • Be sure all parties have the legal capacity to enter into a binding contract. • When minors are involved be sure to get the signature of their legal representative.

  18. Managerial Guidelines • Clearly determine which if any employees can execute contracts on your behalf. • Do not accept verbal modifications to contracts. • Pay attention to college catalogues, personnel manuals and organization bylaws. They are often recognized as the legal equivalent of a contract.

  19. Electing Remedies • Seek rescission if the other party acted fraudulently and there is not significant damage. • Seek reformation if the problem is the result of an honest mistake. • Seek specific performance if the product or service is important and cannot be duplicated. Otherwise seek Damages!

  20. Independent Contractors • License issued by the State • ( track expiration dates) • Bring own tools • Set own work hours • Salaried • Determine work Plan • Implement Work Plan of Boss • Must carry their own insurance (employer doesn’t protect IC from negligence).

  21. Independent Contractors • Weaknesses: • Hold Harmless laws don’t apply • Must withhold own income taxes • Must do own bookkeeping • Must pay own Social Security

  22. Workman’s Compensation • Two required elements: • Employer/Employee Relationship • You are injured in furtherance of employer’s interest.

  23. Professional Sport Contract • Sport Law/Admin. Statutes & contracts/Player Contracts/NFL Player Contract.pdf

  24. Typical Contract Issues • Salary • Signing bonuses • Reserve Clause • Performance • Collective Bargaining • Drafts • Rookie bonuses • Injury These elements become issues as owner try to balance athletic talent and enhance league competitiveness.

  25. Contract law Applications • Contract Law • Rodgers v. Georgia Tech Athletic Association —breach of contract upheld • Yukica v. Leland —coaching contract terminated without due process Sport Law/NCAA v TARKANIAN, 488 U_S_ 179 (1988) -- US Supreme Court Cases from Justia & Oyez.mht

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