Read the text and think of a suitable title for each of the two parts. Compare them with the titles given by your group mates.

2 Give Russian equivalents to the following words:

- to commit - enforceable

- unilateral - executory (contract)

- executed (contract) - redundant

- in scope - a minor

- express (contract) - lease

- implied (contract) - deceased

1 In our daily associations and activities, we all make agreements; some are social in nature and others commit us financially.

Contracts are agreements which create legal obligations and are enforceable in a court of Law.

In civil law, the contract is the basic, legal concept, the foundation of all legal relationships. Every one of our daily acts creates, insome way, a legal obligation.

When we arise in the early morningof a winter day, turn on the lightorradio, we are a party to a contract with the electric company. It makes the electric current available to us and we pay for the amount that we use.

Those of us who are homeowners and don't have our own wells have a similar contract with the water company.

When our newspaper is delivered in the morning, we are purchasers under a contract, either express or implied, to pay for that paper when the newsboy comes around to collect.

We take a taxicab, get on a bus, go by subway; all of these acts are contractual relationships.

These are trivial, unimportant contracts and don't cost much. How about some of our more important transactions, - buying a car, a washing machine, a house? Do we understand the principles which underlie our actions? Do we know the obligations we incur and the rights and privileges that we acquire?

More important, in making a contract, are we certain that it is as binding on the other side as it is on us?

In terms of law, a contract is a mutual obligation between two people with a mutual right by either to demand its performance. The breach of this right, the failure to perform that promise, creates in the other person the right to relief and redress in a court of law.

The Uniform Commercial Code was enacted to simplify the law governing commercial transactions and to continue the accepted commercial customs and practices. The basic concepts of contract law are thus not affected except that those contracts which are of a commercial nature are afforded the expanded benefits of commercial usage.

2 A " unilateral" contract is a promise of commitment made by one party conditioned upon the performance of an act by the other. The contract does not become binding until the act is performed.

Illustration: " I promise to pay you a commission, if you will get me a buyer for my car." When the person to whom the promise is made brings a willing buyer for the car, he has earned his commission.

A " bilateral" contract is created when mutual promises are exchanged by both parties to the transaction. The failure by either party to perform his part of the contract in accordance with his promise may subject him a damages which result from the breach of contract.

Illustration: " I promise to pay you 15¢ a gallon for 300 gallons of#2 grade fuel oil, if you will promise to deliver it tomorrow morning." " I’ll deliver it”.

An " executory" contract is one which is not fully performed. It has been partly performed but something still has to be done by either or both of the contracting parties.

An " executed" contract is one which has been fully performed by both sides. There is nothing further to be done. The transaction is complete.

Illustration: The 300 gallons are delivered in the morning as promised and the buyer pays in accordance with the agreement.

A " void" contract is one which is not legally enforceable and is not binding on either of the parties. The expression " null and void, " so often used, is redundant. It actually means " non-existent and not enforceable."

Illustration: Contracts which are illegal in scope andin purpose arevoid

and unenforceable.

A " voidable" contract is one which is valid, binding and enforceable. However, there is a right available to one or, in some instances, to both of the parties to avoid responsibility of performance. It may thus be enforceable against one of the parties but not against the other. (^;: Illustration: A contract made with a " minor, " also known as an " infant, " a person legally under age, is enforceable by him against the other, the adult.

Under certain circumstances, the minor may renege on his contract and demand the return of the money he paid. Of course, if he seeks to enforce the contract against the adult, he cannot then disaffirm.

An " express" contract is one in which all of the terms are agreed upon by the parties and are specifically set forth in detail, as in a writing.

Illustration: A lease or insurance policy is a good example of an express contract.

An " implied" contract is one which is created by law, imposed upon the parties because of their actionsor their behavior, despite the fact that they had no actual or express agreement.

Illustration: Anna sued the estate of her deceased employer Gertrude. She claimed that she was hired by Gertrude, who was aged and infirm. She was told by Gertrude in the presence of other friends that she need not worry about getting paid, she would be well taken care of in the will. She worked as a companion for 11 years without pay, only for board and lodging. The will only provided for $ 100 to be paid to Anna. She claimed her rightful compensation. Despite the fact that there was no valid express contract between them, a contract was implied by law. Anna was awarded reasonable compensation for the services she ' rendered to Gertrude through the years.

A contract will be implied because of the particular relationship of the parties. A husband is obligated to support his wife, parentsto support and care for their infant children.

A " quasi-contract, " " as if there were a contract, " will result and will be implied when.one party in a transaction is in possession of money or property belonging to another. The law creates this implied contract to prevent that person from being " unjustly enriched."

Illustration: The previously described case of the unpaid companion, also applies here. A person who pays money under a mistake of fact may be given the right to recover it under an implied or quasi-contract.

Illustration: Algernon, believing that he owned a certain parcel of estate, paid taxes on it. When he found that he did not own it, he asked that the money be refunded to him. The city refused and he sued. The court allowed him to recover on the theory of implied contract.

3 Complete the sentences (try not to look at the text):

1. Contracts are agreements which …

2. When making a contract we should be certain that …

3. The failure to perform a promise creates…

4. The Uniform Commercial Code…

5. A unilateral contract is …

6. A bilateral contract is …

7. An " executory" contract is…

8. An " executed" contract is…

9. A " void" contract is…

10. An " express" contract is…

11. An " implied" contract is…

12. A " quasi-contract” is …

4 Speak on the following:

1. What is a contract in terms of law?

2. Give your own illustrations for each type of contract mentioned in the text.