Which of the following statements is true of contracts?
A) Parties to an informal contract can use any words they choose to express their contract.
B) A contract under seal is disclosed only to the offeror of the contract.
C) A letter of credit is an informal contract.
D) A void contract is the same as a voidable contract.

Question

Quizplus · Accepted Answer

Parties to an informal contract can use any words they choose to express their contract. Informal contracts, such as verbal agreements, are not legally required to be in writing and can be expressed using any language that both parties agree upon. However, it is always recommended to have a written contract to avoid any misunderstandings or disputes in the future.

B is incorrect as a contract under seal is usually disclosed to both parties, and not just the offeror.

C is incorrect as a letter of credit is a formal contract used in international trade.

D is incorrect as a void contract is different from a voidable contract. A void contract is one that is not enforceable by law, while a voidable contract is one that can be legally avoided or canceled by one or both parties.

Which of the Following Statements Is True of Contracts