acceleration clause - A clause in a contract for rent, or for installment payments, which provides that all future payments will become due immediately upon the failure to tender timely payments or upon the occurrence of an event.
accord - An agreement between two persons, one of whom has a right of action against the other, to settle the dispute.
actual authority - The power of an agent to bind its principal where such power derives either from express or implied agreement between the principal and the agent.
adhesion contracts - Standard "form" contracts, such as those between a large retailer and a consumer, whereby the stronger party dictates the terms.
administrative law - A body of law created by administrative agencies such as the FTC in the form of rules, regulations, orders, and decisions to carry out their duties and responsibilities. This law can initially be enforced by these agencies, outside the judicial process.
adverse possession - The acquisition of title to real property by occupying it, with the knowledge of the owner, for a period of time specified by the state statutes.
agency - A relationship between two persons where, by agreement or otherwise, one is bound by the words and acts of the other.
agent - A person authorized by another to act for or in place of him or her.
alien corporation - A corporation formed in another country but doing business in the United States is referred to within the United States as an alien corporation.
American Arbitration Association - An organization offering arbitration services in the United States.
anticipatory repudiation - The assertion by a party that he or she will not perform an obligation which the party is contractually obligated to perform at a future time.
arbitrary and capricious - Without basis in fact or law. Without a rational basis.
arbitration - The settling of a dispute by submitting it to a disinterested third party other than a court.
arbitration clause - A clause in a contract which provides that in case of dispute the parties will determine their rights by arbitration rather than through the judicial system.
articles of incorporation - The instrument under which a corporation is formed which serves as a request to a state to be treated as a corporation under that state's laws.
assignment - The act of transferring to another all or part of one's property, interest, or rights.
bankruptcy - Proceedings under law, initiated either by a person or business entity or by its creditors seeking to have the bankrupt's assets distributed among its creditors, thus discharging the debtor's debts.
binder - A written, temporary insurance policy.
blanket policy - A policy covering more than one type of property in one location, or one or more types of property at more than one location.
Blue Sky laws - Another name for state laws which regulate the offer and sale of securities.
breach of contract - Failure, without legal excuse, of a promisor to perform the obligations of a contract.
business tort - A noncontractual breach of a legal duty by one party that directly results in damage or injury to another.
bylaws - The rules which a business firm adopts in order to control the conduct of its internal affairs.
cause of action - A legal right of redress against another; it includes both the right to sue and the right to recover in a court of law or equity.
caveat emptor - (Latin) Literally, "let the buyer beware."
cease and desist order - An administrative or judicial order prohibiting a business firm from conducting the activities which an agency or a court has deemed illegal.
certified check - A check drawn by an individual on his or her own account but bearing a guarantee (acceptance) by a bank that the bank will pay the check regardless of whether the drawer's account contains adequate funds at the time the check is presented.
class action suit - A legal action in which a group of persons are represented by one or a few persons in a lawsuit. The class can be either a plaintiff or a defendant.
close corporation - A corporation whose shareholders are limited to a small group of persons, often including only family members. The rights of shareholders of a close corporation usually are restricted regarding the transfer of shares to others.
collateral - Property in which the secured party has an interest, as security in case of nonpayment by the debtor.
compensatory damages - A money award equivalent to the actual value of injuries or damages sustained by the aggrieved party.
condition - A qualification, provision, or clause in a contractual agreement, the occurrence of which creates, suspends, or terminates the obligations of the contracting parties.
contract - A set of promises constituting an agreement between parties, giving each a legal duty to the other and also the right to seek a remedy for the breach of the promises/duties owed to each. The elements of an enforceable contract are competent parties, a proper or legal purpose, consideration, and mutuality of agreement and of obligation.
copyright - The exclusive right of "authors" to publish, print, or sell an intellectual production for a statutory period of time. It has the same monopolistic nature as a patent or trademark, but a copyright differs from them in that it applies exclusively to works of art and literature.
deceit - A false representation of facts made recklessly, maliciously, or with knowledge of its falsity, which causes the injured person to rely on the misrepresentation.
dissolution - The formal disbanding of a partnership. Can take place by agreement of the parties, death of a partner, or court order.
easement - A nonpossessory right to use another's property in a manner establihed by either express or implied agreement.
embezzlement - The fraudulent appropriation of money or other property by a person to whom the money or property has been entrusted.
exclusive dealing contract - An agreement under which a producer of goods agrees to sell its goods exclusively through one distributor.
fiduciary duty - A duty to act for someone else's benefit, while subordinating one's personal interests to that of the other person. It is the highest standard of duty implied by law.
F.O.B. - "Free On Board"; a delivery term which requires a seller to ship goods and bear the expense and risk of loss to the F.O.B. point designated.
foreclosure - A proceeding in equity whereby a mortgagee either takes title to or forces the sale of the mortgagor's property in satisfaction of a debt.
franchise - An arrangement in which the owner of a trademark, a trade name, or a copyright licenses others, under specified conditions or limitations, to use the trademark, trade name, or copyright in purveying goods or services.
fraud - Any misrepresentation, either by misstatement or omission of a material fact, knowingly made with the intention of misrepresentation to another and on which a reasonable person would and does rely to his or her detriment.
garnishment - A legal process whereby a creditor appropriates the debtor's property or wages which are in the hands of a third party.
