BUS 393 Chapter 6: Chapter 6 – Formation of Contracts

• School: Simon Fraser University
• Department: Business Administration
• Course: BUS 393
• Professor: Richard Yates

Document Summary

The contractual relationship: contract voluntary exchange of promises, creating obligations that if defaulted on can be enforced and remedied by the courts, allows people to create and define their own rules/regulations; restricted by common law and legislation. Intention parties must be serious when making the agreement. Formal contract - sealed by the party to be bound: simple (parol) contract may be verbal or written, not under seal. Express and implied contracts: express contract - parties expressly state their agreement. Implicit contract contract inferred from the conduct of the parties. Unenforceable and illegal contracts: unenforceable contract eg. required to be in writing and is not. Illegal contract involves the performance of an unlawful act; void, courts will not return parties to original positions (unless one party is innocent) Bilateral and unilateral contracts: bilateral contract in which both parties make commitments and assume obligations, unilateral contract no exchange of promises, one party performs what has been requested by the other.