Download - class 10 contracts.ppt
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INTRODUCTION TO COMMMERCIAL REAL ESTATEMANAGEMENT 490October 28, 2009
+Next Two Classes: Contracts
General Contract Law Principles
Commercial Real Estate Contracts RANM Form ______ Vacant Land Sale and Purchase
Agreement
+What is a Contract?
Legally enforceable agreement to do (or not do something)
Express Contract
Implied Contract
Bilateral Contract
Unilateral Contract
+Legal Effect of Contracts
Enforceable
Void Never went into effect
Voidable Obligations can be avoided by a party
Unenforceable Once enforceable, but no longer enforceable
+Essentials of a Valid Contract
Competent Parties Minors Incapacitated Persons Duress Power of Attorney Entities
Corporations Limited liability companies Trusts
+Essentials of a Valid Contract
Mutual Agreement/Meeting of the minds Complete agreement on all essential terms
Offer and Acceptance Accept Reject
Counteroffer Acts like a new offer that can be accepted or rejected
+Essentials of a Valid Contract
Lawful Objective Unlawful Against public policy
Consideration Legal consideration Exchange of promises Adequacy of consideration
+Essentials of a Valid Contract
Contract must be in writing Statute of Frauds New Mexico Statute of Frauds Why should contracts be in writing? Parole evidence rule
New Mexico rule-almost anything can be ambiguous
+When a Contract May not be Valid
Fraud Intention to deceive
Misrepresentation Reckless Negligent
Mutual mistake Mutual mistake of fact (not law)
Lack of Capacity
+Performance of Contracts
Performance/Discharge of Contracts
Assignment of Contracts “personal” contracts not assignable
Novation Substitution of a new contract
Inability to Perform Deceased person Corporate existence ceases
+Breach of Contract
Failure to perform vs. default Notice and cure periods Usually governed by terms of contract If not, law will determine when default occurs No remedy until there is a “default”
+Remedies for Default
Partial Performance
Unilateral Rescission
Money Damages Incidental damages Consequential damages Attorneys’ fees and costs
Liquidated Damages
Specific Performance
Mutual Rescission
+Defenses against Enforcement
Statute of Limitations Purpose New Mexico: suit must be brought within six years for an
action based on breach of a written contract New Mexico: four years for fraud or negligence claims