Contracts Midterm Multiple Choice - Levit

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A publisher mailed an offer to publish a writer's first book for $25,000. The writer immediately mailed back her acceptance. The acceptance was properly addressed with the correct amount of postage. However, the post office lost the letter and the publisher never received it. Is there a contract? (A) No, because the post office lost the letter. (B) No, because the publisher was excused from performance since he did not receive the letter. (C) Yes, because the acceptance was properly addressed with the correct amount of postage. (D) Yes, because the writer mailed her acceptance.

Distributor is a food wholesaler whose customers are dining establishments. Restaurant sends a signed email to Distributor requesting a price quote for wild caught Alaskan salmon. Distributor is limiting the amount it sells to any individual customer, due to a recent shortage of salmon, and it replies to Restaurant that Distributor would sell up to 500 pounds of wild caught Alaskan salmon to Restaurant at the price of $10 a pound. The email listed various payment and delivery terms. Distributor's email ends with the statement: "This offer will be held open for 45 days after which it expires." Distributor signed the email. Twenty days later Restaurant emailed Distributor a signed purchase order for 1,000 pounds of wild caught Alaskan salmon at $10 a pound. The purchase order indicated that Restaurant agreed to all of the payment and delivery terms in Distributor's offer. Distributor replied that it would not ship any salmon to Restaurant. Restaurant brings a breach of contract claim against Distributor. Which of the following is the best statement of the outcome? (A) Distributor wins because Restaurant did not accept the terms of the Distributor's offer. (B) Restaurant wins because Distributor's price quote was a merchant's firm offer that cannot be revoked for 45 days from the date of the offer. (C) Distributor wins because in the sale of goods under the UCC an option from a merchant to hold an offer open for over three months requires consideration. (D) Restaurant wins because Distributor's offer was certain and definite enough to determine an appropriate remedy.

(A) Distributor wins because Restaurant did not accept the terms of the Distributor's offer.

Farmer decides to retire from farming. Employee, who had worked for Farmer for ten years, is interested in purchasing Farmer's tractor. The tractor is valued at $26,000, which is about the same amount as Employee earned in one year. Farmer intends to give Employee a bonus for the past year. After some discussion between the two parties, Farmer provides Employee with a signed writing that states, "In consideration of his long time employment, I promise to give my tractor to Employee." Farmer, however, later refuses to transfer title of the tractor to Employee. If Employee attempts to sue for breach of contract, which of the following is the most likely to result? (A) Farmer wins, because there was no consideration for the bonus. (B) Farmer wins, because the fair market value of the tractor is greater than the reasonable bonus for an employee. (C) Employee wins, because courts do not inquire into the adequacy of consideration (D) Employee wins, because the state of frauds is satisfied.

(A) Farmer wins, because there was no consideration for the bonus.

On September 10, the company, a well-known publisher of law books, posted the following notice on the bulletin board at a law school: As an incentive to research and scholastic excellence, the company announces the institution of an award. The award will consist of a complete set of the company's encyclopedias and will be presented to the student in each graduating class of the law school who attains the highest overall cumulative Grade Point Average. In the event two or more students graduate with the same Grade Point Average, the dean will be asked to select the winner from among them based on school service and community involvement. A student, who had just begun her final year at the law school, saw the notice. Her grades already placed her toward the top of her class, but she resolved to work harder than ever before in an attempt to win the company's award. On September 20, she mailed a letter to the company saying, "I accept your offer for the award and will do my best to win it." Her letter was received by the company, but it was lost in the mailroom before any company officials had an opportunity to see it. Which of the following statements is most correct about the company's notice? (A) It was an offer for a unilateral contact. (B) It was an offer for a bilateral contract. (C) It was an offer for either a unilateral contract or a bilateral contract at the offeree's option. (D) It was an offer for a unilateral contract that ripened into a bilateral contract when the student achieved the highest grade point average in her class.

(A) It was an offer for a unilateral contact.

A client enters into a signed and written agreement with a lawyer in which the lawyer promises to represent the client in a divorce proceeding in return for the client's promise to make one payment of $3,000 to be due when the divorce is granted. The agreement—drafted by the lawyer—provides that the lawyer will make all of necessary court appearances, file all necessary paperwork, and otherwise do all of the legal work necessary until the court grants the divorce. The $3,000 is the lawyer's normal rate for the average divorce. The lawyer, however, miscalculated how much time it would take for this particular divorce. The fair market value of the legal services that the lawyer provided was $20,000. When the court grants the divorce, the client presents the lawyer with a check for $3,000. Will the lawyer be successful if he refuses the $3,000 check as full payment and instead sues the client for the fair market value of $20,000? (A) No, because there was a fully negotiated express contract between the lawyer and the client. (B) Yes, because it would be inequitable for the lawyer to receive less than the full value of the service he rendered. (C) No, unless the lawyer provides sufficient proof that his services would be valued at $20,000 (D) Yes, because there is gross disparity in the consideration.

(A) No, because there was a fully negotiated express contract between the lawyer and the client.

Assume that the defendant in each of the following fact patterns objects to enforcement of the agreement on the ground that it violates the Statute of Frauds. In which of the following fact patterns is the agreement between the plaintiff and the defendant LEAST likely to be enforced over the defendant's objection? (A) The defendant orally agreed to purchase a series of porcelain figurines from the plaintiff to be delivered one per week for 15 weeks at a price of $100 per figurine. Prior to the first delivery, the defendant advised the plaintiff that he was no longer interested in receiving the figurines. (B) The defendant orally agreed to purchase a hand-carved entry door for the defendant's home with the defendant's coat of arms on it for a price of $600. After the plaintiff completed the rough carving of the defendant's coat of arms, the defendant changed her mind and notified the plaintiff that she would not accept delivery of the door. (C) The defendant's pleadings admitted making an oral agreement to purchase a painting from the plaintiff for $900 but asserted as an affirmative defense that the agreement was unenforceable under the Statute of Frauds. (D) The defendant orally agreed to a price of $1,200 for the purchase of 100 lawn-trimmers manufactured by the plaintiff for resale in the defendant's store. The plaintiff then sent the defendant a memorandum signed by the plaintiff and outlining the terms of their agreement. The defendant did not sign the memorandum or respond to it in any way.

(A) The defendant orally agreed to purchase a series of porcelain figurines from the plaintiff to be delivered one per week for 15 weeks at a price of $100 per figurine. Prior to the first delivery, the defendant advised the plaintiff that he was no longer interested in receiving the figurines.

The buyer and the seller were members of the graduating class of a college. The buyer, who was planning to go to law school, told the seller that he might need some law books. The seller had recently inherited a law library, so he compiled a list of the books in the collection and mailed it to the buyer on July 5 with a note that said, "Interested in buying?" The buyer wrote the following letter on a copy of the booklist and mailed it to the seller on Tuesday, July 8: Dear seller, I will buy your law library consisting of the books on this list for $2,600 cash if you deliver the books to my home by the time I start law school in mid-September. I promise to hold this offer open until September 1. Yours truly, [signed] the buyer In the buyer's letter of July 8, what was the legal effect of the statement, "I promise to hold this offer open until September 1"? (A) The language did not prevent the buyer from revoking the offer. (B) At common law, the language creates an irrevocable option in the seller's favor. (C) Under the UCC, the buyer was prevented from revoking the offer until September 1. (D) The language created an option in favor of the seller, subject to the condition that the buyer actually begin law school.

(A) The language did not prevent the buyer from revoking the offer.

The defendant owned a trucking company. His wife, the plaintiff, was a freelance book illustrator. When a book publisher contacted the defendant to discuss the transportation of his products, the defendant promised the plaintiff that he would get the publisher to employ her as a book illustrator for a year. During negotiations with the publisher, the defendant offered the publisher a lower rate if the publisher would do so. The defendant and the publisher subsequently entered into a written one-year contract for the defendant to transport all the publisher's products at a specific low rate. At the same time, the publisher orally agreed that in return for the low rate that the defendant was giving him, he would employ the plaintiff for a year as his book illustrator, starting immediately. When the plaintiff learned of the agreement, she notified all her clients that she could no longer work for them because illustrating books for the publisher would take all her time. For the next six months, the plaintiff did a satisfactory job as the publisher's book illustrator. Then, she and the defendant were divorced. Following the divorce, the defendant told the publisher that he was releasing him from his promise to employ the plaintiff and would give him the same low rate even if the publisher did not continue to employ the plaintiff for the rest of the year. The publisher thereupon discharged the plaintiff from his employ. The plaintiff asserted a claim against the defendant for damages that resulted from his releasing the publisher from the promise to employ the plaintiff for a year. If the defendant's only defense is that he received no consideration for promising the plaintiff that the publisher would employ her for a year, which of the following would be the plaintiff's most effective argument in response to that defense? (A) The publisher's promise to employ the plaintiff for one year was obtained by the defendant as a gift from the defendant to the plaintiff. (B) The defendant made an irrevocable assignment to the plaintiff of rights under his contract with the publisher. (C) No consideration is required to support a promise between husband and wife. (D) The publisher's promise to hire the plaintiff for one year was given in return for the low rate that the defendant gave him.

(A) The publisher's promise to employ the plaintiff for one year was obtained by the defendant as a gift from the defendant to the plaintiff.

The seller and the buyer had been friends for years. The seller was the owner of a rare antique sports car, which the buyer had offered to buy from her on several occasions but which the seller had never been willing to sell. On the buyer's birthday, the seller and the buyer went out for dinner and drinks. After dinner, the seller continued drinking until she was somewhat intoxicated. During their conversation, the seller said, "As a birthday present, I've decided that I'm going to sell you my sports car for $500. And just to make sure that I don't change my mind after I sober up, I'll put it in writing." With that, she wrote on a paper napkin, "We agree to the sale of my sports car to the buyer for $500, COD," and signed her name at the bottom. The buyer also signed the napkin and put it in her purse. The following day, the buyer tendered $500 in cash to the seller, but the seller refused to sell her the car, claiming that she had been drunk when she made the offer. In an action by the buyer against the seller for breach of contract, which of the following additional facts, if it was the only one true, would be most helpful to the seller's defense? (A) The seller was so drunk when she wrote on the napkin that she did not know the legal consequences of her act. (B) The seller would not have offered to sell the car to the buyer for $500 if she had not been drunk. (C) The car was worth more than $500. (D) The seller changed her mind about selling the car before the buyer tendered the cash.

(A) The seller was so drunk when she wrote on the napkin that she did not know the legal consequences of her act.

Wendy is in the business of helping couples plan their weddings in return for a fee. Wendy's busiest month is June since this is when many people get married. On March 1, Wendy emailed Florist and asked, "Can you provide up to 5,000 white roses on June 1? If so, at what price?" Wendy included her address for the purposes of delivery. In a signed email on March 2, Florist replied, "Yes. I can provide that quantity with delivery at that date at your address. At those quantities, the price would be $1 a rose, guaranteed. In order to provide that quantity of roses, you must inform us of the exact number by April 15." On May 1, Wendy called Florist and said, "I am in real need for 4,000 white roses by June 1. Can you deliver?" Florist replied, "I am not sure we can deliver that quantity in your time frame. You should have called earlier." Wendy replied, "Do your best. I really need those flowers." On May 2, Wendy sent a signed email to Florist stating, "I accept your offer to sell me 4,000 white roses at a $1 per rose with delivery of June 1." Florist did not respond and did not send the flowers by June 1. Wendy then sued Florist for breach of contract. How would a court rule not the cause of action? (A) Wendy loses because Florist's offer lapsed before Wendy tried to accept. (B) Wendy loses because the UCC Statute of Frauds is not satisfied even though an oral contract formed. (C) Wendy wins since she accepted an offer made under the Merchant's Firm Offer rule. (D) Wendy wins since her May 2 email satisfies the Statute of Frauds requirement under the Merchant's Confirmatory Memo exception.

(A) Wendy loses because Florist's offer lapsed before Wendy tried to accept.

By signed writing, Seller and Buyer agree that Buyer will pay Seller a nonrefundable $1,000, and Seller, for two months, will hold open an offer to sell her a parcel of real property for the price of $1 million, which is the fair market value of the property. Buyer then pays Seller $1,000. One month later, Buyer tells Seller that Buyer wants to accept the offer and purchase the land. Buyer tenders a cashier's check for $1 million in accordance with the terms of the offer, but Seller refuses to convey title to the property. Is Seller in breach of contract? (A) Yes, because Seller sold Buyer an enforceable option to purchase the real estate (B) Yes, because an option for the sale of real estate requires no consideration (C) No, because the consideration from Buyer for the option is presumptively inadequate (D) No, because the Seller fails to provide consideration for the option.

(A) Yes, because Seller sold Buyer an enforceable option to purchase the real estate

The buyer was a collector of antiques who had purchased many expensive pieces from the seller, an antiques dealer. Knowing that the seller was traveling to Europe, the buyer wrote to him on March 11, "If you should come across a good piece in your travels, please purchase it for me. I don't care about the cost." On April 17, the seller wrote to the buyer, "I have found an excellent table. The price is $15,000, but I think it's a good buy. Are you still interested? If so, let me know if the price is acceptable to you." The next day, for personal reasons, the seller decided he did not want to sell to the buyer. The buyer received the seller's letter on April 21, and, on that same day, e-mailed the seller, "Fifteen thousand is OK. Buy the piece on my account." The seller later sold the piece to another buyer who offered more money. In litigation between the buyer and seller, if a court determines that the seller's letter of April 17 was an offer, was a contract formed between the buyer and the seller? (A) Yes, because sending an e-mail was a reasonable way for the buyer to accept the seller's offer. (B) Yes, because, as a merchant, the seller was obligated to act in good faith. (C) No, because an offer sent by mail may be accepted only by mail. (D) No, because the seller changed his mind about the piece prior to April 21.

(A) Yes, because sending an e-mail was a reasonable way for the buyer to accept the seller's offer.

Carlos has a collection of rocks that he collected when he was a child. Carlos did not know if any of them were valuable. Carlos invited a mineral and gem dealer over to assess the worth of the collection. The dealer examined the collection, took some pictures, and later emailed Carlos stating, "I will purchase your entire collection for $475." The dealer signed the email. Carlos called the dealer on the phone and asked if the dealer would give Carlos $500 for the entire collection. The dealer agreed. Later the dealer came to pick up and pay for the collection; however, Carlos refused to complete the transaction. Carlos said he changed his mind and wanted to keep the collection as a memory of his youth. If the dealer brings a breach of contract claim against Carlos, can Carlos successfully assert the state of frauds as a defense? (A) Yes, because the statute of frauds writing requirement has not been satisfied (B) Yes, but only if Carlos's expertise in minerals qualifies him as a merchant (C) No, because the dealer's email satisfies the statute of frauds as a merchant's confirmatory memo (D) No, because the statute of frauds only applies to sales for over $500

(A) Yes, because the statute of frauds writing requirement has not been satisfied

The plaintiff had long admired the defendant's dog, which was trained to get the paper and start the coffeepot every morning. The plaintiff finally convinced the defendant to agree to sell him the dog, and the defendant wrote out a contract that said, "I agree to sell my dog to the plaintiff. Price to be decided at delivery." The plaintiff was seeking to purchase the dog for resale. When the plaintiff arrived to pick up the dog a week later, the defendant refused to give the dog to him. The plaintiff then filed suit. Does the UCC apply to the transaction between the plaintiff and the defendant? (A) Yes, because this was a transaction in goods. (B) Yes, because the price and the delivery date terms were missing from the agreement. (C) No, because, unless it is a farm animal, a living thing does not fit the definition of "goods" under the UCC. (D) No, because the plaintiff was seeking to purchase the dog for resale.

(A) Yes, because this was a transaction in goods.

The seller and the buyer entered into a written contract for the sale of 200 electric power drills. Although they orally agreed on a price, they inadvertently failed to include it among the terms of the written agreement. In an action for breach of the contract, the court should (A) admit oral testimony to establish the price that the parties intended. (B) refuse to enforce the contract if it is one that the Statute of Frauds required to be in writing. (C) conclude that the contract calls for the payment of a reasonable price. (D) disregard the writing since it fails to contain all the essential terms of the agreement.

(A) admit oral testimony to establish the price that the parties intended.

The buyer received an advertising brochure from the seller in the mail. The brochure contained a photograph of a computer, and above it the statement, "While they last. All computers on sale at 25 percent below manufacturer's list price." The buyer immediately contacted the company that manufactured the computer pictured in the seller's brochure and determined that the manufacturer's list price for the 410 was $1,000. She then sent her check for $750 ($1,000 less 25 percent) to the seller with a cover letter that stated, "I hereby accept your offer for the sale of a computer. My check is enclosed herewith." The seller threw the buyer's letter and check away. The brochure that the seller sent the buyer is best described as (A) an invitation for offers. (B) an invitation for offers that ripened into an offer when the buyer learned the list price for the computer. (C) an invitation for offers that ripened into an offer when the buyer relied on it by sending her check and cover letter. (D) an offer for the sale of a computer.

(A) an invitation for offers.

A manufacturer of computer hardware and software was seeking a way to speed up the operation of its Basic Computer Program. On March 1, it posted the following notice in the employees' lounge: The stockholders of this company are offering a cash prize of $200 to any employee who develops a modification of the Basic Computer Program that will double its operating speed. Design modification entries should be submitted to the head of the Basic Program Department prior to June 1. In the event that modifications are submitted by more than one employee, the prize will go to the employee who submits the design which, in the opinion of the Basic Program Department, can be used most economically. An engineer employed by the company read the notice on March 5, and immediately began working on program modifications in his spare time. On March 8, he wrote and signed a memo that said, "I accept the stockholders' offer of a $200 prize for redesigning the Basic Computer Program. I am hard at work on the project and expect to submit my modification design within a week or two." The engineer sent the note to the head of the Basic Program Department by the interoffice correspondence system, but it was somehow diverted and was never received by the department head. The notice that was posted on March 1 constituted (A) an offer for a unilateral contract. (B) an offer for a bilateral contract. (C) an offer for a unilateral contract that ripened into a bilateral contract when the engineer wrote the memo on March 8 and deposited it in the interoffice correspondence system. (D) a preliminary invitation to deal, analogous to a newspaper advertisement for the sale of goods.

(A) an offer for a unilateral contract.

On July 1, after hearing that the buyer was going to attend law school, the seller sent the buyer a letter offering to sell his old law books. The buyer wrote back on July 8 and told the seller he would buy the law books for $100 if the seller delivered them to his apartment on September 1. On August 1, the buyer decided that he did not want to go to law school after all and wrote the seller a note telling him that he was no longer interested in buying the law books. He was about to go to the post office to mail it when the seller knocked at his door. As soon as the buyer opened the door, the seller said, "I'll bring you those law books tomorrow. I'll just have to borrow a friend's station wagon to transport them." The buyer said, "Never mind. I don't want them," and handed the seller the note that he had written but not mailed. The seller's statement on August 1 that "I'll be bringing you those law books tomorrow" was probably (A) an offer. (B) a ratification of the acceptance that was mailed on July 8 but was never delivered to the buyer. (C) an acceptance. (D) commencement of performance.

(A) an offer.

A corporation that is in the business of running restaurants purchases an insurance policy to protect itself from accidents that might arise in the course of its business. Included in the policy, which was written exclusively by the insurance company, is a definition of "Insured Party." The definition is clear that it covers the corporation itself, its employees, and customers, but ambiguous on whether other parties, such as delivery persons, are covered if they are on the corporation's premises in the course of business and have an accident. In fact, one day a delivery person does have an accident on the premises of one of the corporation's restaurants, but the insurance company refused to pay on the claim. If the corporation sues the insurance company for breach of contract and wins, it is probably because of the legal doctrine of: (A) interpretation against the drafter. (B) misrepresentation. (C) unilateral mistake. (D) the objective view of contracts.

(A) interpretation against the drafter.

Dealer is a used car dealer. Buyer wanted to purchase a new car and found one on Dealer's lot that had a price of $5,000 on the windshield. After a lengthy negotiation, Buyer and Dealer agreed to the sale of the car for a purchase price of $3,000, plus a trade-in vehicle that Buyer owned. Buyer signed a written agreement that provided all of these details—the car, the purchase price, and the trade-in. In addition, Buyer paid Dealer $50 cash as a deposit. Dealer did not sign the written agreement. Buyer returned one week later with the balance of the money due and the trade-in. However, Dealer refused to complete the transaction. Buyer sued for breach of contract. Dealer asserted a statute of frauds defense. If Buyer wins, it is mostly likely because a court determined that: (A) the $50 deposit satisfies the partial payment exception to the statute of frauds. (B) Buyer could be classified as a merchant given her expertise and knowledge about cars. (C) Buyer returned to complete the transaction within 10 days before Dealer objected. (D) Dealer's oral agreement is enforceable since the transaction involved only a $50 deposit and is therefore outside the statute of frauds.

(A) the $50 deposit satisfies the partial payment exception to the statute of frauds.

A world-renowned artist's will left a collection of 30 of his paintings to his niece, an art dealer. The paintings inherited by the niece were untitled, but they were identified by the numbers 1 through 30. The niece had a catalog printed containing photographs and descriptions of each painting in the collection. On August 1, she sent a copy of the catalog to another art dealer, with the following cover letter: I know how much you like my uncle's work, so I'm giving you an opportunity to buy some of these paintings before I offer them to any other dealers. The price is $2,000 per painting, no matter how many you buy. Telegraph your order within two weeks, or I'll put them on the market. (signed) On August 2, the art dealer sent the niece a telegram that said, "I accept your offer to sell painting Number 30 for $2,000. I will come to your gallery in two days to pick up the painting, and will pay cash at that time." On August 3, after receiving the telegram, the niece telephoned the dealer and said that because of favorable publicity that the collection had received, she would not sell painting Number 30 for less than $3,000. The dealer agreed on the telephone to pay $3,000 for painting Number 30. Between August 1 and August 3 the fair market value of the painting increased by $1,000. On August 4, the dealer sent and the niece received a telegram that said, "I accept your offer to sell your uncle's paintings 1 through 29 for $2,000 each. I will pick up the paintings tomorrow, and will pay for them at that time." On August 5, the dealer presented herself at the niece's gallery and tendered payment of $2,000 each for all 30 paintings. However, the niece refused to sell her any of the paintings except Number 30, for which the niece insisted the agreed price was $3,000. The dealer left without buying it, saying that the niece would be hearing from her lawyer. If the niece asserts a claim against the dealer for breach of a contract to purchase painting Number 30 for $3,000, the court should find for (A) the dealer, because her promise to pay $3,000 for the painting was not in writing. (B) the niece, because the fair market value of painting Number 30 increased by $1,000 between August 1 and August 3. (C) the niece, because she relied on the dealer's promise to pay $3,000 for painting Number 30. (D) the niece, because she had not received payment from the dealer prior to their conversation on August 3.

(A) the dealer, because her promise to pay $3,000 for the painting was not in writing.

The defendant, a manufacturer of widgets, entered into a valid written contract that called for the sale of 2,000 widgets to the plaintiff at a price of $10 per widget. Several weeks prior to the date set for delivery, the defendant telephoned the plaintiff and advised her that because of difficulty in locating a sufficient supply of frammis rods, the defendant would be unable to deliver more than 1,000 widgets. After discussion, the plaintiff agreed to accept 1,000 widgets at $10 per widget instead of 2,000 as originally agreed. After the defendant delivered 1,000 widgets, however, the plaintiff brought an action against him for damages resulting from breach of contract. In adjudicating the plaintiff's claim, the court should find for (A) the plaintiff, because her agreement to accept 1,000 widgets was not in writing. (B) the plaintiff, because her promise to accept 1,000 widgets was not supported by consideration. (C) the defendant, because the plaintiff agreed to accept 1,000 widgets. (D) the defendant, because there has been an accord and satisfaction.

(A) the plaintiff, because her agreement to accept 1,000 widgets was not in writing.

The plaintiff worked for a corporation for 40 years. The corporation told the plaintiff that the plaintiff would be given the right to retire at any time with a lifetime pension. The plaintiff continued to work for a few more years, then retired after downsizing her home so that her expenses could be covered by the pension. She received the pension for several years. After the founder of the corporation died, the corporation stopped paying the pension. The plaintiff then sued. The court should rule in favor of (A) the plaintiff, because she chose to retire when she could have kept on working. (B) the plaintiff, because she received the pension in recognition of her 40 years of service. (C) the plaintiff, because she worked for a few more years after receiving the pension promise. (D) the defendant, because there was no consideration supporting the promise of the pension.

(A) the plaintiff, because she chose to retire when she could have kept on working.

The defendant, an 84-year-old woman, suffered from Parkinson's disease. She asked the plaintiff, a woman who rented space in her home, to quit her job so she could care for the defendant. The plaintiff agreed and quit her job in return for the defendant's promise that when the defendant died she would leave the house and surrounding farm to the plaintiff. Three days after the agreement was made, the defendant made an appointment to see her lawyer to change her will. However, before she could keep the appointment, she fell ill and was hospitalized. The plaintiff spent a lot of time with her at the hospital, but a few days later, the defendant died. The plaintiff sued the defendant's estate for specific performance of the promise to convey the house and farm. The court should rule in favor of (A) the plaintiff, because she gave up her employment and agreed to take care of the defendant. (B) the plaintiff, because the defendant showed her intent to honor the agreement by making the appointment with her lawyer. (C) the defendant's estate, because the house and farm are worth much more than the services actually performed by the plaintiff. (D) the defendant's estate, because a will speaks at death.

(A) the plaintiff, because she gave up her employment and agreed to take care of the defendant.

The defendant, who resided in the city, was the owner of a chain of dry cleaning stores. Because his stores had been financially successful, he began selling franchises. By the terms of his franchise agreements, the defendant permitted franchisees to use the name of his store in return for an initial fee of $50,000 and 10 percent of the gross revenues. The plaintiff lived in a distant state. When she heard about the financial success of the stores, she wrote to the defendant, asking him to sell her a franchise to operate a dry cleaning store in her state. Because the defendant had great affection for the plaintiff and wanted her to live near him, he sent her a letter in which he said, "If you will come and live here, I will give you a franchise to operate in the city without any initial fee. All you will have to pay is 10 percent of the gross revenues." The plaintiff immediately wrote the defendant to tell him that she was coming to live in the city as he requested, and that she was looking forward to operating a store there. After the plaintiff moved to the city, however, the defendant told her that his contract with another franchisee prevented him from giving her a franchise to operate a store in the city. If the plaintiff asserts a claim against the defendant for breach of contract, the court should find for (A) the plaintiff, on a theory of bargained-for exchange. (B) the plaintiff, because she detrimentally relied on the promise made by the defendant. (C) the defendant, because his promise was for a conditional gift. (D) the defendant, because his affection for the plaintiff is not sufficient to support his promise to her.

(A) the plaintiff, on a theory of bargained-for exchange.

The buyer agreed to purchase 250 2" × 4" construction-grade wooden studs from the seller by a written contract that provided that the buyer would make payment prior to inspection. The studs were delivered to the buyer by truck and were covered with a canvas tarpaulin when they arrived at the buyer's work site. The driver demanded payment before he would unload or uncover the studs. The buyer refused to pay for the studs before inspecting them, and the driver returned them to the seller. If the seller asserts a claim for breach of contract against the buyer, the court should find for (A) the seller, because the buyer's refusal to pay prior to inspection was a breach. (B) the seller, because the buyer's refusal to pay prior to inspection was an anticipatory repudiation. (C) the buyer, because the contract provision calling for payment prior to inspection was unconscionable. (D) the buyer, because the seller failed to deliver the studs.

(A) the seller, because the buyer's refusal to pay prior to inspection was a breach.

A landowner was suffering from a terminal disease and did not expect to live much longer. She was the owner of a parcel of realty known as Blackacre and wanted her son to have it. Blackacre was worth $500,000, but it was subject to a non-assumable mortgage securing a note with a balance of $100,000. For this reason, the landowner offered to sell Blackacre to her son for $100,000. Her son said that he would like to buy it, but that it would take him a while to raise the money. Fearful that she would die before the transaction could be completed and that her administratrix would be unwilling to sell the realty to her son for that price, the landowner wrote and signed a document that said, "In consideration of $20 paid to me by my son, I hereby promise to convey my realty known as Blackacre to him for the sum of $100,000 if he pays the entire purchase price within one month." Two days later, the landowner died. One week after that, her son tendered the sum of $100,000 to the administratrix of the landowner's estate, demanding that she convey Blackacre to him, but the administratrix refused. If the son instituted a proceeding against the landowner's administratrix for an order directing her to sell Blackacre to him for $100,000, the court should find for (A) the son, because the document written and signed by the landowner was a valid option contract. (B) the son, because the document written and signed by the landowner was intended to be a testamentary substitute. (C) the landowner's administratrix, because $20 is not sufficient consideration for a $100,000 option. (D) the landowner's administratrix, because $100,000 is not sufficient consideration for realty valued at $500,000.

(A) the son, because the document written and signed by the landowner was a valid option contract.

On June 2, a truck manufacturer and an engine maker entered into an agreement for the sale of a new engine for $1,000. In a telephone conversation with the engine maker on June 5, however, the truck manufacturer said that he would sue the engine maker for breach of contract unless the engine maker agreed to accept $200 as payment in full. Because business was poor, the engine maker agreed to accept that sum, but then she subsequently rejected the truck manufacturer's tender of $200. If the engine maker sues the truck manufacturer for $1,000, the court should find for (A) the truck manufacturer, because the original agreement was modified in the telephone conversation of June 5. (B) the engine maker, because her agreement to accept $200 was not evidenced by a writing. (C) the engine maker, because her agreement to accept $200 was unsupported by consideration. (D) the engine maker, because her agreement to accept $200 was made under duress.

(A) the truck manufacturer, because the original agreement was modified in the telephone conversation of June 5.

Antonio owns several expensive paintings. On August 1, a burglar breaks into his home and steals his most prized painting. On August 2, Antonio publicly offers a reward of $10,000 to the person who provides information that leads to the return of the painting. On August 3, Bruno, a detective, calls Antonio and says, "I accept your offer. I promise to put all of my efforts into getting your painting returned." Bruno spent a substantial amount of time trying to locate the painting, but was unsuccessful. On August 20, Christina, an art dealer, contacted Antonio and provided information about someone who tried to sell the painting to her. The police were able to use the information that Christina provided to capture the criminal and return the painting to Antonio on August 20. Which of the following statements is correct? (A) A bilateral contract formed between Antonio and Bruno (B) A unilateral contract formed between Antonio and Christina (C) Both Bruno and Christina formed contracts with Antonio (D) Neither Bruno nor Christina formed a contract with Antonio since it was the police who performed by returning the painting.

(B) A unilateral contract formed between Antonio and Christina

An art dealer employed several agents who traveled throughout the world purchasing art for her to sell in her gallery. One of her agents sent her a painting that she said was by a famous artist. The dealer had just received the painting and was about to place it on display when the buyer, a collector of art, came into the gallery. Seeing the new painting, he said, "An interesting painting by the famous artist." The dealer replied, "Yes, it is. I'm asking $50,000 for it." The buyer agreed to the price and immediately wrote a check for the sum of $50,000 payable to the order of the dealer, writing the words "Payment in full for the painting by the famous artist" on the back of the check. The dealer accepted the check and delivered the painting to the buyer. If the painting had actually been by the famous artist, it would have been worth $50,000. The same day, however, the buyer discovered that the painting was a forgery, worth only a few hundred dollars, and he stopped payment on his check before the dealer could cash it. If the dealer asserts a claim against the buyer for breach of contract, which of the following would be the buyer's most effective defense? (A) The contract of sale was not evidenced by a writing signed by both parties. (B) At the time of sale, the buyer and the dealer both believed that the painting was by the famous artist. (C) It is unconscionable to make the buyer pay $50,000 for a painting worth only a few hundred dollars. (D) The painting was not adequate consideration for the buyer's promise to pay.

(B) At the time of sale, the buyer and the dealer both believed that the painting was by the famous artist.

Builder is in the business of constructing modest homes. Owner owns a piece of property on which he wants to build a house. At the request of Owner, Builder prepares an offer to build a house on the property in return for $100,000. The offer provides all of the key specifications needed to build the house. In reviewing the offer, Owner says to Builder, "I would like to keep your offer under advisement. Would you consider making the following modifications for the same price?" Owner then added dozens of changes to the specifications. Builder realized that Owner would be difficult to work with and that Builder might lose money on this deal. After Owner added yet another proposed modification, Builder reached across the table, took the copy of his original offer from Owner, and tore it up in front of Owner. Builder said, "I don't think I can do this." Owner replied, "I accept your offer." Which of the following best expresses the legal relationship between the parties? (A) Owner's request for changes to the specification was a counteroffer that destroyed Owner's power of acceptance as to Builder's offer. (B) Builder's statement of uncertainty and ripping up of the offer was, in effect, a revocation of Builder's offer. (C) Owner formed a contract with Bolder according to the terms of Builder's original offer. (D) Owner formed a contract with Builder that incorporates Owner's proposed terms.

(B) Builder's statement of uncertainty and ripping up of the offer was, in effect, a revocation of Builder's offer.

Cleaner ran a cleaning service and ran advertisements in the local media stating, "I will clean any space that is 2,000 square feet or less for $250 no matter how dirty it is. Call now to accept this offer." The advertisement provided contact information for Cleaner. Owner owns an office building, and each floor measured exactly 2,000 square feet. Owner called Cleaner's phone number but got voicemail. Owner left the following message, "I accept your offer. If you can start cleaning tonight by 9:00pm and finish by tomorrow morning at 7:00am, I will pay you $300 per floor to clean each of the floors in my building." Owner provided the necessary details such as the building address and combination needed to unlock the doors. Owner then ended the voicemail saying, "You need not call back. Just show up and start working. I will pay." Cleaner received the voicemail and went to Owner's building that evening before 9:00pm, unlocked the doors, and started cleaning the first floor. Owner, who was working late, saw Cleaner and said, "Stop. I changed my mind. I don't want you to clean my building." Cleaner stopped working and later brought a breach of contract suit against Owner. Who will prevail in the lawsuit? (A) Cleaner, because Owner accepted Cleaner's offer by leaving a voicemail. (B) Cleaner, because Owner's offer provides for acceptance by performance. (C) Owner, because Cleaner never called back to accept Owner's offer. (D) Owner, because Owner revoked before Cleaner promised to clean the building.

(B) Cleaner, because Owner's offer provides for acceptance by performance.

Hank owns a metal machine shop and is in the process of selling of the assets to Kent. Both parties are of equal bargaining power. The written contract included the following language: "The sale of the machine shop will include all of the shop's wrenches, screwdrivers, and other hand tools." In the machine shop, Hank has a display of antique wood working tools that his grandfather had given him. The antique wood working tools are not used to produce any products in the machine shop. Kent says that the term "and other hand tools" includes the antique woodworking tools. Hank contends that it does not. If the disagreement went to litigation and a court found in Hank's favor it is probably because of which of the following principles of contract interpretation? (A) Construction against the drafter. (B) Ejusdem Generis. (C) Consider the entire language of the contract. (D) Whether one of the parties ascribed a different meaning to the term.

(B) Ejusdem Generis.

On August 1, a wholesaler of office supplies contracted by telephone to sell 50 cases of typewriter ribbons to a business equipment retailer at a total price of $450. On August 15, the wholesaler telephoned the retailer and told him that because of a shortage of materials, the price that the wholesaler had to pay for typewriter ribbons had increased drastically. The wholesaler said that if he delivered the ribbons at the price of $450, he would lose a great deal of money. He asked the retailer to consent to a higher price, suggesting that the retailer pass the increase along to his customers. After further discussion, the retailer and the wholesaler agreed to change the price of the order from $450 to $650. On August 18, the retailer succeeded in purchasing 50 cases of typewriter ribbons from another supplier for $500. On September 1, the wholesaler delivered 50 cases of typewriter ribbons to the retailer, together with a bill for $650. The retailer rejected the delivery. In an action by the wholesaler against the retailer for breach of contract, which of the following would be the retailer's most effective argument in defense? (A) The wholesaler's demand for more money was unconscionable, since typewriter ribbons were available at a lower price. (B) The August 15 agreement increasing the price was not in writing. (C) The retailer's promise to pay $650 was unsupported by consideration. (D) An increase in the wholesaler's cost resulting from a shortage of materials was foreseeable on August 1.

(B) The August 15 agreement increasing the price was not in writing.

Which of the following is most likely to be regarded as valid consideration for a man's oral promise to pay his neighbor $1,000? (A) The fact that his neighbor had saved the man's house from a fire the day before the man's promise was made. (B) The fact that at the same time the man made the promise to pay, his neighbor promised to deliver to the man fire-fighting equipment valued at $1,000. (C) The fact that after the man made the promise, his neighbor relied upon it by committing himself to the purchase of fire-fighting equipment at a price of $1,000. (D) The fact that immediately after the man made the promise, his neighbor sent the man a written memorandum of their agreement, to which the man did not object within 30 days.

(B) The fact that at the same time the man made the promise to pay, his neighbor promised to deliver to the man fire-fighting equipment valued at $1,000.

The homeowner went into his garage one morning and found that someone had broken in during the night and stolen a hand-carved milking stool that had been stored there. The stool did not have much intrinsic worth, but it was a family heirloom and had great sentimental value for the homeowner. The angry homeowner ran into a bar that was located near his home. Entering the bar, he said in a loud voice, "I'll pay $1,000 to anyone who finds the thief that stole a hand-carved stool out of my garage last night." The owner of the bar heard the homeowner's statement and said, "I'll catch that thief for you." Which of the following statements most correctly describes the position of the homeowner and the owner of the bar following the incident in the bar? (A) The homeowner has made an offer for a unilateral contract that became irrevocable when the owner of the bar said, "I'll catch that thief for you." (B) The homeowner has made an offer for a unilateral contract that the owner of the bar can accept only by catching the thief before the homeowner makes an effective revocation of the offer. (C) The homeowner and the owner of the bar are parties to a bilateral contract. (D) The homeowner has not made any offer that can be accepted by the owner of the bar.

(B) The homeowner has made an offer for a unilateral contract that the owner of the bar can accept only by catching the thief before the homeowner makes an effective revocation of the offer.

After serving in the military for several years, a soldier informed her father that she had gotten married and was retiring from military service. Glad to hear the news, the soldier's father agreed to give the soldier a house built on his land as a present. Thrilled with the gift, the soldier cancelled her contract to buy another house. The father and a builder signed an agreement to build a new house, and the father showed the plans to the soldier. However, after beginning the work, the builder discovered that the house could not be built for what the father was willing to pay. Consequently, the father and the builder agreed to a smaller plan for the house. If the soldier asserts a claim against her father for changing the building plans, which of the following would be the most effective argument in support of her claim? (A) The modification of the father's contract with the builder was unsupported by consideration. (B) The soldier detrimentally relied on her father's oral promise by canceling the contract that she had already made to purchase a home. (C) The contract between the father and the builder was a writing signed by the father. (D) The soldier's marriage and retirement from military service was consideration for her father's promise to give her a house built according to the plans that he showed her.

(B) The soldier detrimentally relied on her father's oral promise by canceling the contract that she had already made to purchase a home.

The plaintiff, an unmarried woman, became pregnant. Before the child was born, she told the defendant that he was the father. The defendant agreed to pay the expenses of having the child in return for the plaintiff's promise not to bring a paternity suit. After the child was born, the defendant refused to pay. A blood test then proved that the child could not be the defendant's. The plaintiff sued the defendant, claiming the defendant still needed to live up to the settlement since she had truly believed he was the father of the child. The court should rule in favor of (A) the plaintiff, because she detrimentally relied on the defendant's promise. (B) the plaintiff, because the plaintiff had a reasonable subjective belief that her claim was valid. (C) the defendant, because forbearance to bring suit cannot count as consideration for a settlement. (D) the defendant, because the plaintiff merely surrendered an invalid claim.

(B) the plaintiff, because the plaintiff had a reasonable subjective belief that her claim was valid.

Aldo Cruz visits FlyBy, a store that sells propeller aircraft. He examined several models and eventually settled on a Cessna Grand Caravan EX. The sales agent gave him a one page "Model Information Sheet" that described the Grand Caravan EX. The sheet claims that the "occupancy of the plane is 12-16" and the "takeoff distance is 1,800 ft." Cruz was given the "Model Information Sheet" before he signed the agreement to purchase, and he read the entire sheet. The local airport near his home has a shorter-than-average runway and so he was pleased that the takeoff distance was only 1,800 ft. Since the document listed the needed takeoff distance, he never asked the sales agent about it. Cruz also needed a plane with the capacity of 16 people as he had plans to take a group that size on several outings. The contract he signed to buy the plane made no mention of any warranties and did not represent the capacity or takeoff distance. When he tried to take off from his local airport, they would not clear him to take off with that plane because they claimed he needed 2,055 feet to take off. After several calls to Cessna engineers, he confirmed that this was indeed the minimum takeoff distance, and the Model Information Sheet was in error. Will Cruz likely succeed in a breach of warranty action against FlyBy? (A) Yes, the plane is not fit for the particular purpose of Cruz (shorter takeoff distance) and FlyBy is therefore in breach of the warranty of fitness for a particular purpose. (B) Yes, FlyBy breached an express warranty about the takeoff distance. (C) No, the contract to purchase did not include any warranties and therefore no warranties, express or implied, were given. (D) No, Cruz never communicated his particular purpose to the sales agent at FlyBy and therefore no warranty of fitness for a particular purpose was given.

(B) Yes, FlyBy breached an express warranty about the takeoff distance.

Milo likes to plan ahead. His son will be graduating from college in three years. He contacts Engaging Events, a venue that hosts and caters large parties. Milo and Rachel, an employee of Engaging Events, agree orally that Milo will host his son's graduation party at their venue on June 10, three years from the date of their conversation, for $20,000, to be paid on the day prior to the event. No writing satisfying the Statute of Frauds exists. A year prior to the agreed party date, Rachel calls Milo and tells him that they have a request for a wedding that will net the venue much more money and so they cannot host Milo's party. Can Engaging Events successfully raise the Statute of Frauds as a defense, assuming the applicable state has a Statute of Frauds that mirrors the Restatement (Second) of Contracts? (A) Yes, because the contract is for an amount greater than $500. (B) Yes, because the contract cannot be performed within one year. (C) No, because the contract will only take one day to perform and therefore can be performed within one year. (D) No, because the contract does not involve employment services that extend for more than one year.

(B) Yes, because the contract cannot be performed within one year.

Because its property was filling up with a lot of unwanted recycled plastic it didn't want to pay to have removed, a landfill gave a construction firm free recycled plastic for use in its construction work. All the firm had to do was come to the landfill and pick it up. The plastic turned out to be defective, and the firm sued the landfill for breach of contract. The landfill argued that there were no contractual obligations to the firm because any promise it made was not supported by consideration. The landfill argued it had merely made a gift of the plastic on the condition that the firm come and pick it up. Can the firm successfully sue for breach of contract? (A) Yes, because the firm relied on the landfill's promise to its detriment. (B) Yes, because the landfill wanted the firm to take the plastic and benefited when it did so. (C) No, because the landfill did not bargain for the firm's performance. (D) No, because the unwanted plastic was a gift.

(B) Yes, because the landfill wanted the firm to take the plastic and benefited when it did so.

Mi Lu offers to sell her vacation home to Henri Ghent. The offer is sent in the form of a contract to purchase real estate that includes all material terms and is signed by Lu. Upon receipt Ghent signs the contract and deposits it in the US mail addressed to Lu at the address listed in the contract. The next morning Ghent has second thoughts and takes a copy of the contract he had made before signing it and changes the purchase price by reducing it by 15%. He then signs this new version and brings it to the FedEx store and sends it to Lu overnight delivery. The next day Lu receives the second copy (with the reduced purchase price) and the day after that she receives the first copy Ghent sent in the mail. She notes the postmark on the mailed copy is a day prior to the date the FedEx package was sent. Lu calls Ghent and said she is holding him to the original contract and price, and he must perform. At this point does a contract exist between Lu and Ghent for the purchase of the vacation home at the original price? (A) Yes, once an offered contract is signed the acceptance is effective. (B) Yes, the acceptance was effective prior to the counteroffer and thus the contract was formed because the counteroffer became effective. (C) No, due to the battle of the forms provision in UCC §2-207, the written records contradict each other (one form shows a higher price and another a lower price) and therefore no contract was ever formed. (D) No, because Lu received the counteroffer before the acceptance, the counteroffer acted as a rejection and since Lu never accepted the counteroffer no contract was formed.

(B) Yes, the acceptance was effective prior to the counteroffer and thus the contract was formed because the counteroffer became effective.

On June 11, the homeowner asked a local handyman whether the handyman would be interested in painting the homeowner's house. Following their conversation, they entered into the following handwritten agreement, which the handyman wrote on the back of an old envelope and which both signed: The homeowner and the handyman hereby agree that the handyman will paint the outside of the homeowner's house for $700 as follows: wood trim brown; doors and window frames green; siding yellow (two coats). The handyman painted the siding yellow and gave it two coats of paint. He painted the wood trim brown and the doors and window frames green, but gave them only one coat of paint. The homeowner refused to pay unless the handyman gave the wood trim, doors, and window frames a second coat. The handyman instituted an action against the homeowner for $700. At the trial, the homeowner attempted to testify that prior to executing the agreement, he and the handyman agreed orally that the handyman would apply two coats of paint to the wood trim, doors, and window frames, as well as to the siding. The trial judge should rule the homeowner's testimony (A) admissible only for the purpose of establishing that the phrase "(two coats)" is ambiguous. (B) admissible for the purpose of establishing that the phrase "(two coats)" is ambiguous and for the additional purpose of explaining the ambiguity. (C) admissible, because the agreement was written by the handyman. (D) inadmissible, since the writing was a complete expression of the agreement of the parties.

(B) admissible for the purpose of establishing that the phrase "(two coats)" is ambiguous and for the additional purpose of explaining the ambiguity.

A contractor and a homeowner agree orally that the contractor will build a swimming pool on homeowner's land for $90,000. The homeowner also inquires how much it would cost to construct a cabana behind the pool, and a cement walkway leading from the pool to the cabana. The contractor says it will cost an additional $15,000. The homeowner decides not to build the cabana and walkway. The parties draft a contract that is exhaustively detailed, complete with a merger clause, for the construction of the swimming pool. Right after the parties sign the agreement, the homeowner says, 'I changed my mind. I would like you to build the cabana and walkway; I'll pay the $15,000.' The contractor agrees to do the additional work for $15,000. The contractor builds the swimming pool, whereupon the homeowner pays him $90,000. The homeowner then asks the contractor to build the cabana and walkway. The contractor refuses, and the homeowner sues the contractor for breach of contract. At trial, the homeowner wants to testify to the parties' oral agreement concerning the cabana and walkway. The contractor objects, citing the parol evidence rule. How should the court rule on the issue of whether the homeowner can testify about the oral agreement? (A) Allow the testimony on the basis that it is a collateral contract with a separate consideration. (B) Allow the testimony only if the homeowner plans to testify that the contractor defrauded her. (C) Allow the testimony because it relates to events subsequent to the signing of the pool contract. (D) The court should not allow the testimony.

Casper was a longtime employee at MegaCorp. After working at the company for 25 years, MegaCorp told Casper, "Because you have been such a loyal employee for many years, MegaCorp promises that you will be provided with a monthly pension of $4,000 for the remainder of your life." Casper then retired and MegaCorp began making monthly payments. After five years, MegaCorp stopped making the monthly payments to Casper. What would be Casper's best legal theory of recovery if he sues MegaCorp for not making the payments: (A) MegaCorp breached an express unilateral contract that formed by Casper's retirement. (B) MegaCorp was unjustly enriched by Casper by his many years of service. (C) Casper relied to his detriment on MegaCorp's promise of a pension by retiring. (D) MegaCorp's promise of a monthly pension of $4,000 for life lacks consideration.

A rescuer saved the life of a man's wife, who subsequently promised to change her will to leave $500 to the rescuer. The wife later died intestate, however, survived only by her husband. After the wife's death, the husband executed a document that read as follows: In consideration of my wife's promise to leave the rescuer $500, of the rescuer's saving my wife's life, and of the rescuer's promise not to assert any claim against the estate of my wife, I hereby promise to pay the rescuer the sum of $500. The husband died two months after signing the above agreement. The rescuer submitted a claim for $500 to the administrator of the husband's estate, but the administrator denied the claim. Is the fact that the rescuer saved the wife's life sufficient consideration for the husband's promise to pay him $500? (A) Yes, because it is recited as consideration in the document that the husband signed. (B) Yes, because it materially benefited the husband. (C) No, because the husband did not ask the rescuer to save his wife. (D) No, because the value of the service rendered by the rescuer to the husband was speculative.

Felicia and Gary orally agree to become partners in the ownership and operation of a retail pharmacy. They prepare a writing, exhaustively detailed in all respects, providing at its end: 'Merger: This writing constitutes the complete and final expression of the parties' agreement.' Prior to signing the document, Felicia says to Gary, 'Before I'm bound by all of this, I'd like to have my lawyer approve it. So, let's sign now, with the understanding that I'm not bound unless and until my lawyer gives me his o.k.' Gary responds, 'That's fine.' Both parties sign the writing. Felicia's lawyer reads the writing and disapproves of several of its provisions. Is Felicia bound by the writing? (A) Yes, because the writing embodies a merger clause (B) Yes, because the writing constitutes a total integration (C) No, because the parties agreed that Felicia's obligation was subject to a condition precedent (D) No, because a contractual writing is generally unenforceable if it omits a term that the parties by prior oral agreement expressly intended to include in their agreement

Jason Slate has owned and operated a pest control business for many years. He recently signed a contract with Bug B Gone a large national pest control company, to sell his business to them for $4 million. The sale is memorialized in a 220-page purchase and sale agreement that contains a merger clause that makes clear the agreement is the final integrated agreement of the parties with respect to all matters relating to the sale of the business. Two days before they signed the agreement Jason said he was worried that Bug B Gone would terminate his employment as general manager shortly after the sale. The representative of Bug B Gone conducting the negotiations, Melinda French, said, "We could include a provision that says if your employment is terminated within the first two years, we would pay additional consideration of $400,000." Jason said, "I agree to that approach. That would alleviate my concern." Melinda said she would speak with her lawyers and try to include that provision. The lawyers never included this oral agreement in the contract and Jason's lawyer never objected before they signed. Bug B Gone fired Jason seven months after the purchase occurred. Will Jason be able to introduce evidence of the additional purchase price that Bug B Gone agreed to pay if his employment were terminated? (A) Yes, because there is a written memorandum of the contract the statute of frauds does not bar the introduction of evidence about oral agreements. (B) Yes, the testimony will resolve uncertainty about the amount of purchase price that Bug B Gone must pay as consideration. (C) No, the parol evidence rule prevents introduction of this testimony of the oral agreement. (D) No, the statute of frauds prohibits introduction of evidence of an oral agreement that might last more than one year.

Mariah met with George and said, "Will you promise to paint the outside of my vacation home for $4000, to be completed in two weeks?" Mariah owned two vacation homes, one in Fort Lauderdale and the other in West Palm Beach. The one in Fort Lauderdale is much smaller than the home in West Palm Beach, and Mariah meant her larger West Palm Beach home. In Mariah's presence George called his partner Denny and said "Mariah wants us to paint her vacation home in Fort Lauderdale for $4000. Given how small the place is, I think we can do it for that amount and get it done in a week. Do you agree with my assessment?" Denny agreed. After he hung up the phone, George says "Yes, I agree." Four days later, George calls Mariah and says: "I am on my way to Fort Lauderdale right now to paint your house." Mariah responds, "You agreed to paint my West Palm Beach house; that is the one I intended when I made my offer. George says there is no way he can complete that size house by the next week and he would have charged $8,000 if she had meant that house. Do Mariah and George have an agreement to paint her vacation house in West Palm Beach? (A) Yes, Mariah made an offer and since the offeror is the master of the offer her understanding of the vacation home to be the West Palm Beach house is determinative. (B) Yes, because an ambiguity in an offer is resolved against the offeree since the offeree has an opportunity to ask clarifying questions. (C) No, they have an agreement to paint the Fort Lauderdale house for $4,000 since the meaning understood by George is controlling. (D) No, an offer containing any ambiguity cannot be the basis of a contract.

(C) No, they have an agreement to paint the Fort Lauderdale house for $4,000 since the meaning understood by George is controlling.

The seller was an importer of arts and crafts products from Mediterranean countries, selling mainly to large department stores and import shops. To keep his sales force down to a minimum, the seller did most of his selling by sending catalogs describing products and prices to prospective customers and taking orders by mail on forms provided with the catalogs. The phrase "10 percent discount on COD orders only" appeared on the order form and on each page of the catalog. After receiving one of the seller's catalogs, the buyer decided to order 1,000 Greek coffeepots for sale in her import shop. On April 25, she typed the following across the seller's order form: "Send immediately 1,000 Greek coffeepots (Catalog #6047) at 10 percent discount. Payment within 10 days of receipt and acceptance." The seller received the order on April 27. On April 28, the seller shipped 1,000 Greek coffeepots to the buyer, who received and accepted them on May 2. On April 29, the seller wrote to the buyer, "I am shipping pursuant to your request and will expect payment within 10 days. Since discounts apply only to COD shipments, you are herewith billed at full price." The buyer received the letter and enclosed bill on May 3. On May 4, the buyer sent the seller a check in payment of the amount billed, less 10 percent. When was a contract for sale of the coffeepots formed? (A) On April 25, when the buyer sent the order to the seller. (B) On April 27, when the seller received the order from the buyer. (C) On April 28, when the seller shipped the coffeepots to the buyer. (D) On May 2, when the buyer received the shipment of coffeepots.

Distributor purchases food from farmers, packages it, and then resells it to grocery stores. Supermarket is a large supermarket chain. On January 2, Supermarket and Distributor negotiate an oral agreement where Supermarket will purchase and Distributor will sell 200 metric tons of packaged oranges for $500 a ton. Under the agreement, Distributor is to deliver the oranges to Supermarket's warehouse on January 30, at which time Supermarket will pay Distributor the agreed price. On January 10, Supermarket sends Distributor by email a written "purchase order" confirming the terms of the oral agreement and which is signed by Supermarket. Distributor receives the purchase order the same day and reads it, but does not respond. At the end of January, Distributor refuses to deliver the oranges. If Supermarket brings a breach of contract suit against Distributor, what is the likely outcome? (A) Distributor wins, because no contract ever formed since Distributor never accepted the offer made by Supermarket when Supermarket sent the January 10 purchase order. (B) Distributor wins, because Distributor can use the statute of frauds as a defense since the agreement was oral. (C) Supermarket wins, because under the UCC, the purchase order was a confirmation of an oral agreement and therefore satisfies the statute of frauds. (D) Supermarket wins, because Distributor's silence was acceptance of Supermarket's purchase order.

(C) Supermarket wins, because under the UCC, the purchase order was a confirmation of an oral agreement and therefore satisfies the statute of frauds.

Mariah is a law student and is struggling to make ends meet. She tells her uncle Morris that the bookstore will not let her purchase books on credit anymore since she has not made payments for the past two months. She needs her books for this semester as the first class is approaching. The owner of the bookstore knows Uncle Morris as they are old friends, and he knows that Morris is quite wealthy. Morris calls the owner and says, "If you will let my niece Mariah buy her books on credit, I promise that if she does not pay her bill with you by the end of the academic year, I will pay you the balance." The owner of the bookstore agrees. Morris writes a quick thank you note to the owner on his personal stationary that includes his initials at the top of the card. The note says: "Thank you for agreeing to continue to sell on credit to my niece in exchange for my promise to honor her debts." He neglects to sign the note. If the bookstore sues to enforce Morris's promise what is the likely outcome if Morris raises the Statute of Frauds as a defense, assuming the applicable state has a Statute of Frauds that mirrors the Restatement (Second) of Contracts? (A) The court will deny enforcement of the oral contract because there is no writing signed by Morris that memorializes the contract and this type of contract falls within the Statute of Frauds. (B) The court will dismiss such a defense because the Statute of Frauds does not apply to Morris's promise. (C) The court will dismiss Morris's defense, because Morris's thank you note meets the requirements of a signed written memorandum. (D) The court will determine that the Statute of Frauds applies and was not satisfied but will dismiss the defense because the store partly performed by selling books to Mariah before Morris called.

(C) The court will dismiss Morris's defense, because Morris's thank you note meets the requirements of a signed written memorandum.

In an agreement made on April 15, the plaintiff agreed to design a coat of arms for the defendant and to fabricate a wooden door with the coat of arms carved into it for the front of the defendant's home. The defendant agreed to pay $650 for the door, but it was understood that if the defendant was not completely satisfied with the coat of arms and the door, he would be under no obligation to go through with the deal. Before the plaintiff completed the door, the defendant came to the conclusion that he did not really want a coat of arms. When the plaintiff brought the finished door to the defendant, the defendant took a quick glance at it. Although the coat of arms was properly designed and carved, and although the door had been fabricated in a workmanlike manner, the defendant said, "I just don't like it," and refused to accept it. In an action by the plaintiff against the defendant, which of the following would be the defendant's best defense? (A) The agreement was not in writing as required by the Statute of Frauds. (B) The agreement was an offer for a unilateral contract that the defendant rejected by refusing to accept the finished door. (C) The defendant's subjective satisfaction was a condition precedent to his obligation to accept the door. (D) Since the coat of arms was not yet associated with the defendant, it was possible for the plaintiff to find another buyer for it.

On May 15, after negotiation, a painter and a homeowner entered into a written agreement for the painting of the homeowner's home. The writing stated that the price was to be $300 plus the cost of materials, that the work was to begin on June 2 and be completed by June 12, that stucco portions of the house were to be painted yellow and wood trim was to be painted brown, and that the written memorandum was a full and final expression of the agreement between the painter and the homeowner. During litigation between the painter and the homeowner to enforce the contract, the homeowner offered to testify to the following additional facts. Which is the LEAST likely to be admitted into evidence over timely objection by the painter? (A) Prior to signing the memorandum, the painter and the homeowner orally agreed that the contract would have no legal effect if the homeowner sold his house prior to June 2. (B) Prior to signing the memorandum, the painter and the homeowner orally agreed that the homeowner would use no paint without first submitting it for the homeowner's approval. (C) While signing the memorandum, the painter and the homeowner orally agreed that any promises made by either of them during negotiations were to be enforceable, even if they were omitted from the memorandum. (D) While signing the memorandum, the painter and the homeowner orally agreed that the painter would spend no more than $10 per gallon for paint.

(C) While signing the memorandum, the painter and the homeowner orally agreed that any promises made by either of them during negotiations were to be enforceable, even if they were omitted from the memorandum.

Robert Benson enters into a contract with Carla Dade to purchase a "watchdog" for $1,000 When Carla delivers a Bulldog to perform the contract, Robert objects claiming a Doberman was indicated by "watchdog." The court concludes after examining the contract that it is a fully integrated agreement. Will Robert be able to introduce evidence that at the time of contracting they discussed a Doberman being a watchdog and not a Bulldog? (A) No, the parol evidence rule prohibits introduction of evidence of the contemporaneous or prior agreement because the court found their contract to be fully integrated. (B) No, the agreement about breed of dog is not a collateral agreement and therefore an exception to the parol evidence rule is not available. (C) Yes, the evidence would be introduced to resolve the ambiguous term "watchdog." (D) Yes, contracts for the sale of a dog are covered by the Uniform Commercial Code and it does not include a parol evidence rule.

The buyer was a collector of antiques who had purchased many expensive pieces from the seller, an antiques dealer. Knowing that the seller was traveling to Europe, the buyer wrote to him on March 11, "If you should come across a good piece in your travels, please purchase it for me. I don't care about the cost." On April 17, the seller wrote to the buyer, "I have found an excellent settee. The price is $15,000, but I think it's a good buy. Are you still interested? If so, let me know if the price is acceptable to you." The buyer received the seller's letter on April 21, and, on that same day, texted the seller, "Fifteen thousand is OK. Buy the piece on my account." Soon thereafter, the seller sold the piece to another collector who offered more money. In litigation between the buyer and the seller, if a court determines that the seller's letter of April 17 was not an offer, it will most likely be because that letter (A) was an acceptance of the offer contained in the buyer's letter of March 11. (B) did not specify the terms of payment. (C) did not manifest a willingness to be bound. (D) did not specify a manner of acceptance.

On March 22, by a written memorandum signed by both parties, the seller agreed to sell and the buyer agreed to buy a described parcel of realty. The buyer and seller were both in the business of buying and selling real estate. The contract called for closing of title on May 30 and fixed all other terms, but it did not indicate the price to be paid. On May 30, the buyer tendered $60,000 cash, but the seller refused to convey the realty. The buyer subsequently instituted an action against the seller for specific performance of the contract and offered evidence that $60,000 was the fair market value of the realty both on March 22 and on May 30. In defense, the seller asserted that the memorandum failed to satisfy the requirements of the Statute of Frauds. The buyer's suit against the seller should (A) succeed, because the buyer and the seller are both in the business of buying and selling real estate. (B) succeed, because under the UCC, a contract that is silent as to price is presumed to call for payment of fair market value. (C) fail, because the written contract did not fix the price to be paid. (D) succeed, because there is likely evidence establishing that the parties orally agreed that the price to be paid was the fair market value of the realty.

The defendant was the owner and operator of a store that sold exotic birds and aviary supplies. The plaintiff was the owner and operator of a pet shop in which dogs, cats, tropical fish, and exotic birds were sold. The defendant kept a trained Amazon parrot on a perch near the sales counter in his store. The bird had an extensive vocabulary and did tricks on his perch to the great amusement of the defendant's customers. The plaintiff wished to have the parrot for his own personal pet and had attempted to purchase him from the defendant on numerous occasions, but the defendant always indicated that he was unwilling to sell. On January 5, the plaintiff again asked the defendant if he would sell the parrot, to which the defendant replied, "I'd consider selling him to you, but I don't even know what a bird with this parrot's training is worth." The plaintiff said that he would do some research to find out, if the defendant would promise to seriously consider selling the parrot for whatever they found the proper price to be. Based on their conversation, the plaintiff and the defendant executed the following document: The defendant hereby agrees to sell to the plaintiff one trained Amazon parrot for a price to be paid in cash and on delivery, said price to be agreed upon after determining the reasonable value of a bird with the parrot's training. The plaintiff contacted five generally acknowledged experts in trained exotic birds and received opinions from them regarding the parrot's value that ranged from $700 to $1,000. When the plaintiff attempted to buy the parrot from the defendant for $1,000, however, the defendant indicated that he was unwilling to sell the parrot at any price. In an action by the plaintiff against the defendant for specific performance of the agreement made on January 5, the plaintiff will (A) win, because he offered to pay $1,000 for the parrot. (B) win, but he will be required to pay a price for the parrot that the trier of fact finds to be reasonable in light of expert and other evidence presented at the trial. (C) lose, since the January 5 document does not manifest an intent to be bound. (D) lose, since specific performance is not available in an action for breach of a contract for the sale of a chattel.

A hiker was hiking in the woods when she heard a cry for help. She then saw a climber hanging from the edge of a cliff, clearly about to fall. The hiker ran to the cliff's edge and pulled the climber to safety. The climber was so happy that he said, "In token for saving my life, I promise to pay you $100 the first of next month." A few days later, the climber died falling from another cliff. The jurisdiction has a "Good Samaritan" statute. If the hiker institutes an action against the executor of the climber's estate for the $100 that the climber promised to pay her, the court should find for (A) the hiker, because the jurisdiction has a "Good Samaritan" statute. (B) the hiker, because she detrimentally relied on the climber's promise to pay her. (C) the climber's executor, because the climber's promise was unsupported by consideration. (D) the climber's executor, because it is impossible to calculate the value of the hiker's services.

The defendant was a veterinarian who specialized in the treatment of livestock, including pigs, horses, cows, and sheep. The plaintiff was a farmer who raised various species of livestock. In addition, the plaintiff kept a private collection of exotic animals. Because the plaintiff's livestock frequently needed the attention of a veterinarian, he entered into a written contract with the defendant on January 1. Under the terms of the contract, the plaintiff was to pay the defendant $250 per month for one year, in return for which the defendant would render whatever treatment the plaintiff's livestock required during that period. On February 10, the local zoo telephoned the defendant, offering to give her a surplus tiger. Although the defendant had no experience with exotic animals, she accepted the tiger and put it in a cage in the back of her office. On February 22, having heard that the defendant had acquired a tiger, the plaintiff called her. When he asked the defendant if she was interested in selling the tiger for $450, she said, "I was hoping to get $1,000 for the tiger, but I'll throw it in under our existing contract without charging you anything at all for it." On March 10, the defendant was at the plaintiff's farm for the purpose of inoculating some of his cattle. When the plaintiff asked why she had not brought the tiger, the defendant said, "I've changed my mind. If you want the tiger, you'll have to pay $450 for it." The plaintiff asserts a claim against the defendant because of her refusal to deliver the tiger as promised. The court should find for (A) the plaintiff, because although the defendant was not a merchant as to the sale of a tiger, she was a merchant as to the sale of veterinary services. (B) the plaintiff, because his conversation with the defendant on February 22 resulted in a valid modification of the existing contract. (C) the defendant, because her promise to give the plaintiff the tiger was unsupported by consideration. (D) the defendant, because her promise to give the plaintiff the tiger was not in writing.

The seller and the buyer were neighbors who owned homes on adjoining parcels of realty. They were both in the business of selling art supplies, each operating an art supply store that engaged in friendly competition with the other. The seller owned a garden tractor that he used for cultivating vegetables in the backyard of his home. The buyer, who wanted to plant a garden in his own backyard, sent the seller a note in which he offered to buy the tractor from the seller for $500. The seller responded on February 15 by sending the buyer a letter that stated, "I will sell you my garden tractor for $600, and not a penny less. To give you time to think it over, I promise to hold this offer open until March 15." On March 5, the buyer noticed a similar garden tractor in the yard of another neighbor. He called that neighbor on the phone and offered to buy it for $500, but he said, "Are you kidding? I just bought it from [the seller] for $600." On March 6, the buyer went to the seller's store with $600 in cash, and said, "I've decided to buy that tractor from you. Here's the money." The seller refused the money and told the buyer that he had already sold the tractor to the other neighbor. If the buyer asserts a claim against the seller for damages resulting from the seller's refusal to sell the tractor on March 6, the court should find for (A) the buyer, because the seller's offer of February 15 was irrevocable until March 15. (B) the buyer, because the seller did not notify him that he was withdrawing his offer to sell the buyer the garden tractor until after the buyer accepted it. (C) the seller, because the buyer learned of the sale to the other neighbor on March 5. (D) the seller, because his letter of February 15 was a rejection of the buyer's original offer to purchase the garden tractor.

Nephew inherited a large collection of antique jewelry from his aunt. Nephew wished to sell most of the collection. Dealer, who was familiar with the collection, asked if Nephew would sell the entire collection to Dealer. On November 5, Nephew sent Dealer a signed letter stating, "I offer to sell you portions of my aunt's collection of antique jewelry as listed below for $300,000 to be paid by certified check at closing. This offer terminates if your acceptance is not received by November 15." Nephew's letter then listed the items Nephew wanted to include in the sale and the time and place of closing. Dealer received Nephew's letter on November 10. On November 11, Dealer telephoned Nephew and said, "I would like to keep your offer of November 5 open, but I want to inquire whether it was possible to include one or two items that are not listed in your letter. I am willing to pay an additional price." Nephew declined but stated that he hoped Dealer would still accept Nephew's offer. On November 15, Dealer mailed a signed letter that stated, "I accept your November 5 offer to sell the jewelry listed for $300,000 according to the terms and conditions of the offer." On November 20, Nephew received Dealer's November 15 letter. Which of the following most accurately reflects the relationship of the parties on November 20? (A) Dealer's letter of November 15 formed a contract since acceptance is effective on dispatch. (B) Dealer's letter of November 15 could not form a contract because the terms of Nephew's November 5 offer were not certain and definite. (C) Dealer's letter of November 15 failed to form a contract because Dealer lost the power of acceptance when Dealer made a counteroffer during the November 11 telephone call. (D) Dealer's letter of November 15 can be reasonably construed to be an offer to purchase the collection of jewelry listed in Nephew's November 5 letter, and Nephew had the power to accept that offer but failed to do so.

(D) Dealer's letter of November 15 can be reasonably construed to be an offer to purchase the collection of jewelry listed in Nephew's November 5 letter, and Nephew had the power to accept that offer but failed to do so.

Stan and Barbara are neighbors. On April 15, Stan told Barbara he was planning to sell his car. Barbara said she might be interested in buying it. After discussion, Barbara paid Stan $100 in cash and Stan signed a document which contained the following language: 'For $100 and other good and valuable consideration, receipt of which is acknowledged, I hereby offer to sell my car to Barbara at a price of $5,000 and promise to hold this offer open until June 1. If Barbara decides to purchase the vehicle, the $100 which I have received from her shall be applied to the purchase price. If Barbara does not decide to purchase the vehicle, I will keep the $100.' On May 15, Barbara informed Stan that she had borrowed money from her parents and had decided to buy the car, but Stan said that he had already sold the car to someone else. If Barbara asserts a claim against Stan based on Stan's promise to keep the offer open until June 1, the court should: (A) Not enforce the option contract because the promise is illusory since the $100 would be applied to the sale of the car. (B) Return the $100 to Barbara based on a theory of restitution since letting Stan retain the money would result in unjust enrichment. (C) Enforce the promise because under the UCC it was a firm offer in writing and signed by the seller. (D) Enforce the promise as an option contract supported by consideration.

(D) Enforce the promise as an option contract supported by consideration.

In anticipation of changing over to a more "upscale" restaurant, a restaurant entered into a written agreement with a new butcher. Under the agreement, the butcher would provide "as many top quality steaks at $10 per pound as the restaurant decides to order." A week later, before the restaurant had made its first order, the butcher called the restaurant and said that a sharp rise in the price of cattle feed meant that it was impossible to provide "top quality" steaks for less than $15 per pound. The butcher said he was willing to provide lower quality steaks if the restaurant wanted to keep the price the same. The restaurant responded that it was already planning to host the National Meat Eater's Convention and could only do so if it had top quality steaks. The restaurant sued the butcher for breach. How should the court rule? (A) In favor of the restaurant, because of its detrimental reliance. (B) In favor of the restaurant, because this is a valid requirements contract. (C) In favor of the butcher, under the doctrine of impossibility. (D) In favor of the butcher, because the restaurant's promise is illusory.

(D) In favor of the butcher, because the restaurant's promise is illusory.

In response to an advertisement that he saw in the newspaper, the homeowner telephoned the contractor and asked him to come to the homeowner's home to estimate the cost of providing and installing new aluminum screens for all the homeowner's windows. After taking measurements, the contractor returned to his shop and prepared a written estimate, in which he said that he would do the entire job for $350. When the homeowner received the contractor's written estimate, he wrote across it with a red felt-tipped pen, "I'll pay $300, but not a penny more," and mailed it to the contractor. When the contractor received the estimate with the homeowner's statement written on it, he wrote on the estimate, "I'll do it for $325." He sent the estimate back to the homeowner on September 5, but on September 12, having received no response, he sent the homeowner a note that said, "All right, you win. I'll do the job for $300. Unless I hear from you to the contrary, I'll be there with the new screens on September 28. Signed, the contractor." The homeowner received the note on September 14, but made no response. On September 28, without the homeowner's knowledge and while the homeowner was at work, the contractor went to the homeowner's home and installed new aluminum window screens. Which of the following best characterizes the legal relationship between the homeowner and the contractor AFTER installation of the window screens on September 28? (A) A contract was formed when the homeowner failed to respond to the contractor's letter of September 12 within a reasonable time after he received it. (B) A contract was formed when the contractor began to install the screens on September 28. (C) A quasi-contract was formed when the contractor finished installing the screens on September 28, obligating the homeowner to pay a price equivalent to their reasonable value. (D) No contractual relationship existed between the homeowner and the contractor.

(D) No contractual relationship existed between the homeowner and the contractor.

A niece is enrolled to start college in the fall. Her aunt tells her, "I promise to give you $30,000 to help you pay tuition for your first year; however, I won't have the money until the end of your first semester. You can count on me; however, I will give you a check in December." Because of her aunt's promise, the niece defers the start of her freshman year until January. During the fall, the niece travels to Europe, where she stays at expensive hotels, eats at expensive restaurants, and spends her nights dancing at clubs. The niece charges $20,000 on her credit cards for the trip, expecting to be able to pay them off in December when her aunt gives her the money she promised. However, when the niece returns home, the aunt refuses to pay niece the $30,000. The niece brings a lawsuit against her aunt seeking the $30,000 that was promised. Will the niece recover any amount from the aunt? (A) Yes, for $30,000, the amount the aunt promised (B) Yes, but for only $20,000, the amount the niece relied to her detriment on the aunt's promise (C) Yes, because the niece's trip to Europe was consideration for the aunt's promise (D) No, because the niece's actions were not reasonably foreseeable

(D) No, because the niece's actions were not reasonably foreseeable

Book Club sends three recently published novels to Camila. All three novels are on the list of "best sellers." The letter accompanying the packages states that Alison may purchase the books for only $20, which is 30% below the retail price. The letter also states, "If you do not want the books, then please return the books within five days and you will not owe us anything. If we do not receive the books within five days, then we will consider the books to have been purchased and we will bill you for $20." Book Club did not include return postage. Camila does not respond to Book Club within five days. Instead, Camila puts the three novels on her bookshelf unread, so that she can return the books if Book Club sends return postage. Has a contract formed between Book Club and Camila? (A) Yes, because it was reasonable for Book Club to expect that Camila would understand that silence is acceptance (B) Yes, because Camila has exercised dominion over the books by putting the books on her shelf. (C) No, because a discount of only 30% is not enough to characterize the $20 as nominal consideration. (D) No, unless Book Club can show that there are prior dealings with Camila that justify Book Club in thinking that her silence would be acceptance.

(D) No, unless Book Club can show that there are prior dealings with Camila that justify Book Club in thinking that her silence would be acceptance.

Landscaper sent a letter to Nursery on August 1 stating, "I need to purchase 100 evergreen trees. Are you able to deliver this many trees and how much would it cost?" Landscaper included details about the specific type of evergreen tree and the size required. Landscaper also signed the letter. Nursery replied to Landscaper with a signed letter dated August 5 that stated, "Mr. Landscaper, we can provide you with 100 evergreen trees according to your specifications for the price of $500, which is $5 per tree. This price is good for six months." Landscaper received the letter on August 10. Which of the following is the best description of the legal effect of Nursery's letter? (A) Nursery's letter is an offer, but only if Landscaper accepts it within six months. (B) Nursery did not make an offer because the term concerning the six-month period is over the three-month limit under the UCC's Merchant's Firm Offer provision (C) Nursery only gave a price quotation, which is not an offer. (D) Nursery made an offer on August 10.

(D) Nursery made an offer on August 10.

A high-end furniture maker uses a particular type of wood called "curly maple" to make its furniture. To make sure that it has a sufficient supply of curly maple wood, the furniture maker enters into a contract with a lumber company. The contract provides that the furniture maker will purchase and the lumber company will sell all of the curly maple that the lumber company produces for five years at a specific price. For the first two years, the lumber company produces 100,000 board feet of curly maple a year, which the furniture company purchases. For the third year, the lumber company thinks that it can produce up to 200,000 board feet of curly maple. Which of the following best describes the rights and duties of the parties? (A) The lumber company is not required to sell any of its curly maple wood to the furniture maker if there are large variations in the quantity that it produces. (B) The lumber company must sell at least 100,000 board feet of curly maple wood to the furniture maker and may sell anything in excess to another buyer. (C) The lumber company must sell its curly maple wood exclusively to the furniture maker and the furniture maker must purchase curly maple exclusively from lumber company. (D) The furniture maker is not obligated to purchase a quantity that is unreasonably disproportionate from the previous output of 100,000 board feet.

(D) The furniture maker is not obligated to purchase a quantity that is unreasonably disproportionate from the previous output of 100,000 board feet.

The buyer, who was planning to go to law school, told the seller that he might need some law books. The seller had recently inherited a law library, so he compiled a list of the books in the collection and mailed it to the buyer on July 5 with a note that said, "Interested in buying?" The buyer wrote back to the seller and told him that he would buy the books if the seller delivered them to his home on September 1. The seller received the letter on Wednesday, July 9, and immediately responded by writing, "I accept your offer to buy my library and will deliver it to you as you require." He signed the letter and mailed it properly addressed to the buyer, but due to a fire in the post office, it was never delivered. When the seller delivered the books on September 1, the buyer refused to accept them. If the seller instituted an action against the buyer for breach of contract, which of the following statements is most correct about the seller's letter of July 9? (A) It bound both parties to a unilateral contract when it was mailed. (B) It formed a bilateral contract when mailed because the buyer chose the mail as the medium of communication. (C) The letter would have constituted an acceptance if it had been received, but because it was not received, no contract was formed. (D) The seller's mailing of the letter did not prevent the buyer from withdrawing his offer.

(D) The seller's mailing of the letter did not prevent the buyer from withdrawing his offer.

A homeowner resides in an area frequently subject to electrical power failure and wants to install a 'back-up' generator. He visits an electrical supply store that is run by an electrician, bringing with him a professionally drawn electrical wiring diagram of his home that also shows the electrical usage of all appliances and other devices in the home. Showing the diagram to the electrician, the homeowner expresses his wish to install in his home a generator that in case of power outage will provide electrical power, fully, to all his lights and appliances. 'Then, the outage won't affect my home in any way,' the homeowner says. The electrician shows the homeowner the LightsOn Home Back-Up 2 KW Generator, packaged in the manufacturer's box. 'Here's one,' the electrician says. The homeowner purchases the LightsOn generator, and has it professionally installed in his home. Three months later, the homeowner's neighborhood suffers a power outage. The homeowner turns on the generator, but it fails to fully power his home. The homeowner revisits the electrician and tells him that the generator does not serve his purpose. Truthfully and accurately, the electrician responds, 'The manufacturer makes a limited warranty that for one year the generator will be free of defects in design and manufacture. It's in the box; that's our warranty. But, I want to look at the generator. Let's go to your home.' The electrician accompanies the homeowner to his home and tests the generator. Truthfully and accurately, the electrician says, 'It's working just as it should. It's not defective. The manufacturer does not warrant that the product will fully power your home with these appliances. I'm afraid you have no recourse." Does the homeowner have recourse? (A) No, because the owner is subject to the maxim, 'caveat emptor' (B) No, because the manufacturer's written warranty is limited to freedom from defect (C) Yes, because the electrician sold the homeowner the generator with a warranty of its merchantability (D) Yes, because the electrician sold the generator warranting that it was fit for the homeowner's particular purpose

(D) Yes, because the electrician sold the generator warranting that it was fit for the homeowner's particular purpose

The buyer operated a grocery store in which he sold fresh fish and other food items. The seller was a wholesaler of fresh fish. By a written contract, the buyer and the seller agreed that the buyer would purchase from the seller 100 kilograms per week of a fish known as "rock lurgid" at a specified price that was higher than the market price of "scmods," another type of fish. When the seller made the first delivery under the contract, however, the buyer refused to accept it, complaining that the fish delivered by the seller was scmods, a species unrelated to lurgid. The buyer was aware of the fact that scmods is frequently referred to as "rock lurgid." The seller subsequently asserted a breach of contract claim against the buyer. At the trial, the seller attempted to testify that in the fresh fish industry, scmods is frequently referred to as "rock lurgid." If the buyer objects, this testimony should be (A) excluded, because it modifies the terms of a written contract that the buyer and the seller intended to be a complete record of their agreement. (B) excluded, because the price to which the buyer and the seller agreed is higher than the market price of scmods. (C) admitted, because the buyer was aware of the fact that scmods is frequently referred to as "rock lurgid." (D) admitted, to explain the meaning of the term "rock lurgid" as used in the contract.

(D) admitted, to explain the meaning of the term "rock lurgid" as used in the contract.

A foreign country is an English-speaking republic on the continent of Europe. Its unit of currency is the "dollar," which is worth about 85 U.S. cents. While on a business trip in the United States, the plaintiff, who owned a glue factory in the foreign country, entered into a written contract with the defendant. According to the contract, the defendant was to purchase 30 tons of liquid glue from the plaintiff, to be delivered on or before July 10. The contract stated the total price of the glue to be "NINE THOUSAND ($9,000) DOLLARS." After receiving the shipment, the defendant sent the plaintiff an international money order for 9,000 of the foreign country's dollars. The plaintiff wrote to the defendant, claiming that the agreement called for the payment of 9,000 U.S. dollars, but the defendant refused to make any further payment. The plaintiff instituted an action against the defendant in the United States and offered to testify that, prior to executing the written memorandum, she and the defendant agreed that the price expressed in the writing was to be in U.S. dollars. If the defendant objects to the testimony, the objection should be (A) sustained, since the oral agreement about which the plaintiff is offering to testify was made prior to the execution of the written memorandum of sale. (B) sustained, only if the written memorandum was prepared by the defendant. (C) overruled, unless the writing is found to be a complete integration of the agreement between the defendant and the plaintiff. (D) overruled, because the evidence that the plaintiff is offering to present does not modify or contradict the terms of the writing.

(D) overruled, because the evidence that the plaintiff is offering to present does not modify or contradict the terms of the writing.

Immediately after his graduation from college in June, the plaintiff announced his plan to begin law school the following September and to marry his girlfriend in December. The plaintiff's father was afraid that marriage during the plaintiff's first year of law school might cause him to fail or drop out of school. He called the plaintiff on the phone and said that if the plaintiff postponed his wedding plans until after the completion of his first year of law school, he would give him a cash bonus of $1,000 and would pay the plaintiff's tuition for the second year of law school. The plaintiff agreed and called his girlfriend to tell her that he wanted to postpone the wedding. She became so angry at him that she broke off their engagement. Two months later, the plaintiff's girlfriend married someone else. The plaintiff's father died soon after the plaintiff began school, but the plaintiff successfully completed his first year. Although the plaintiff earned excellent grades, he decided that he was not really interested enough in the law to want to continue his legal education. After failing to register for a second year of law school, he notified his father's administrator of his decision. The plaintiff said that although there would be no tuition expense, he expected to be paid the $1,000 cash bonus that his father had promised him. The administrator refused to pay anything. If the plaintiff brought suit against the administrator of his father's estate for $1,000, the plaintiff would probably be (A) unsuccessful, because his contract with his father violated public policy. (B) unsuccessful, because the plaintiff failed to register for a second year of law school. (C) unsuccessful, because the plaintiff's death terminated his offer. (D) successful.

(D) successful.

A general contractor was planning to bid on a government project to build a bridge. The general contractor solicited bids from subcontractors for a variety of jobs including dredging work. The general contractor informed all of the subcontractors that their bids would be used for the general contractor's bid for the government bridge project. Among the bids for the dredging work, the lowest was $100,000, and the general contractor used this bid in making his overall bid to the government. The general contractor was awarded the government contract. Before the general contractor could contact anyone, the subcontractor who made the $100,000 bid called the general contractor to say that it was revoking its offer because it had made a mistake. The subcontractor was willing to do the work for $120,000. The general contractor refused and then found another subcontractor to do the dredging work for $110,000. If the general contractor sues the subcontractor who initially bid $100,000 and wins a breach of contract lawsuit, it is probably because the court held: (A) that the parties formed an express option contract to keep the subcontractor's $100,000 offer open for a reasonable time and the general contractor accepted within that time frame. (B) that the subcontractor made an express offer for a unilateral contract where the beginning of performance was the general contractor's submission of his bid to the government. (C) that an express conditional contract had formed where if the general contractor won the government bid, then the contract for dredging work would form. (D) that the general contractor relied to its detriment on the subcontractors' bid.

(D) that the general contractor relied to its detriment on the subcontractors' bid.

A man texted his friend, "I really want to sell my motorcycle. I would consider $2,000 for it." His friend immediately texted back, "I accept! I'll give you a check immediately!" The friend then went to his bank and had a cashier's check for $2,000 prepared. He also went out and bought a motorcycle helmet, motorcycle leathers, and a shed in which to store his new motorcycle. The next day when the friend showed up for the motorcycle, the man refused to give it to him. If the friend sues for specific performance, the court should find for (A) the friend, because he accepted the man's offer. (B) the friend, because he detrimentally relied on the man's offer. (C) the man, because he merely made a statement of future intention. (D) the man, because he was merely soliciting bids.

(D) the man, because he was merely soliciting bids.

A real estate developer wished to purchase coin-operated washing machines and dryers for laundry rooms in its residential properties. After some negotiation with a manufacturer of washing machines, the manufacturer provided the developer with a signed and written offer letter that stated that the manufacturer would sell and install up to 500 washing machines and 500 dryers of a certain make and model at a price of $300 each. The offer letter was dated July 1 and stated that the offer would be held open until September 30. Before making the sale, the developer wanted to shop around, although it was not able to find a better deal. On September 1, the manufacturer told the developer that it would now have to charge $350 for each machine since the developer took two months to decide. The developer immediately sent an acceptance of the manufacturer's July 1 offer placing an order for 500 washing machines and 500 dryer at $300 each. The manufacturer refused to honor the July 1 offer. If the developer sues the manufacturer for breach of contract and the developer wins it will probably be because: (A) the building company had no reasonable alternatives but to purchase the machines from the manufacturer. (B) the increased price was unconscionable (C) the court invoked the common law doctrine of promissory estoppel. (D) the manufacturer's offer was deemed irrevocable until September 30.

(D) the manufacturer's offer was deemed irrevocable until September 30.

A drug manufacturer made vaccines and sold them to various distributors. Just before the drug manufacturer was about to raise the price of its vaccines, one of the distributors learned of the pending price increase. On May 19, the distributor placed a large order for 1,000 vials. The distributor's order stated that the distributor was to receive a price of $64 per vial (the old price), compared with the new price of $171. On June 3, the manufacturer shipped 50 vials at the old price, and simultaneously notified the distributor that the remainder of this order would be priced at the new price. The notice said the manufacturer was shipping the 50 vials as a favor, and acceptance of the order was expressly conditioned on the manufacturer's terms. The notice also said that if the distributor wanted to cancel the balance of the order, it could do so on or before June 13. The distributor sued for an order of specific performance compelling the manufacturer to sell it the remaining 950 vials at the old price. The court should rule in favor of (A) the distributor, because the manufacturer accepted the offer by shipping 50 vials. (B) the distributor, because the manufacturer breached the contract by sending only 50 vials. (C) the manufacturer, because the distributor's actions were unreasonable. (D) the manufacturer, because it made a counteroffer.

(D) the manufacturer, because it made a counteroffer.

When the seller inherited a valuable painting, he asked the buyer, an art dealer, if she was interested in buying it. On January 15, after looking at the painting, the buyer said that she would not have enough cash to purchase the painting until February 1. At the buyer's request, the seller signed a document containing a written offer to sell the painting to the buyer for $50,000 and a written promise to hold the offer open until February 2. On January 20, the seller sold the painting to someone else for $45,000. The following day, after the buyer read about the sale in a newspaper, she went to the seller's home with $50,000 in cash and demanded that the seller sell her the painting for that price. The seller refused, saying that he was withdrawing his offer. If the buyer asserts a claim for damages resulting from the seller's sale of the painting to another, the court should find for (A) the buyer, because she accepted the seller's offer before the seller withdrew it. (B) the buyer, because the seller promised in writing to hold the offer open until February 2. (C) the seller, because a judgment for damages is not an appropriate remedy for breach of a contract to sell a unique chattel. (D) the seller, because when the buyer tendered payment, she knew that the seller had already sold the painting.

(D) the seller, because when the buyer tendered payment, she knew that the seller had already sold the painting.

. An importer of arts and crafts products from Russia sold his products mainly to department stores and import shops. To keep his sales force down, the importer did most of his selling by sending catalogs describing products and prices to prospective customers and taking orders by mail on forms provided with the catalogs. The forms contained the phrase "10 percent discount on COD orders only." After receiving one of the catalogs, a coffee shop owner decided to order some Russian coffeepots for sale in her store. The shop owner had been doing business with the importer on an "open account" basis. On July 27, she typed the following across the importer's order form: "Send immediately 50 Russian coffeepots at 10 percent discount. Payment within 10 days of receipt and acceptance." The importer received the order on July 29. On July 30, the importer shipped 50 coffeepots to the shop owner, who received and accepted them on August 3. On July 31, the importer wrote to the shop owner, "I am shipping pursuant to your request and will expect payment within 10 days. Since discounts apply only to COD shipments, you are herewith billed at full price." The shop owner received the letter and enclosed bill on August 4. On August 5, the shop owner sent the importer a check in payment of the amount billed, less 10 percent. If the importer asserts a claim against the shop owner for the balance of the amount billed, the court should find for (A) the importer, because the shop owner's order was on the importer's order form. (B) the importer, because the shop owner was aware that the importer's catalog and order form specified that the 10 percent discount applied only to COD shipments. (C) the shop owner, because she had been doing business with the importer on an "open account" basis. (D) the shop owner, because the importer accepted her offer to purchase at a 10 percent discount.

(D) the shop owner, because the importer accepted her offer to purchase at a 10 percent discount.

Contracts Midterm Multiple Choice - Levit

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