Business Law Final

The destruction of items that the promisor intended to use in performing would not excuse nonperformance if it just made performance more difficult for the promisor.

True

The violation of usury laws may require the forfeiture of interest and principle.

True

To make a 3rd party a donee beneficiary the creation of a gift of a contracted performance to the third party must be the promisee's primary purpose in contracting.

True

Undue influence renders a contract voidable and is a ground for rescission.

True

When a promisee agrees not to do something, he or she has a legal right to do in exchange for the promisors promise. It constitutes: legal value.

True

All of the following under the UCC are ways to communicate acceptance except:

A means slower and safer than the way the offer was communicated.

To satisfy the statute of frauds writing requirement, both parties signature must appear in writing.

False

To create acceptance to an offer for a bilateral contract:

Acceptance must always be properly communicated to the offeror.

Identify the legal term for settling a disputed claim.

Accord satisfaction.

If the girl hands a guy a detailed offer for the purchase of his house and he signs the offer without changing any of its terms; both parties are bound by the terms of the offer:

Bilateral Contract.

Under the UCC, minors who disaffirm their contracts involving goods:

Can no longer reclaim those goods from innocent third parties.

Assignees

Can sue the promisor for nonperformance.

For the purposes of minors contracting for necessaries, it would include all of the following except:

Concert tickets.

Ratification of a contract which is voidable for the lack of capacity:

Cuts off the right to disaffirm.

Whether a given item is considered necessary:

Depends on a minor's station in life.

Dad wants to reward son from graduating college. Under the contract, Dad promises to pat the dealer for the car in exchange for the dealer's promise to deliver the car to son. In this case, son is a...

Donee beneficiary.

The term delegations refer to the transfer of:

Duties.

A contract adhesion is not in violation of the public policy.

False

A fully executory bilateral contract that cannot be performed within a year after it was made need not evident by writing to be enforceable.

False

A negligent unilateral mistake is always the ground for rescission.

False

A party to an illegal contract who is fully aware of the contracts illegality, can still fully recover damages.

False

A person who discovers that he is a victim of fraud has an indefinite amount time in which to file his grievance.

False

A promise supported by past consideration is enforceable.

False

A promisees consideration must be another promise and cannot be in the form of an act.

False

All states require a formal statement by the minor before they find gratification.

False

An acceptance must be in writing.

False

Certain formalities are required to create an assignment.

False

Consideration must have monetary value to have legal value.

False

For the contract to be illegal on the grounds of public policy, a statute for an administrative regulation must define precisely what that policy is.

False

Minors who successfully disaffirm a contract are not entitled to the return of any consideration they may have given the adult party to the contract.

False

Punitive damages are recoverable for breach of contract.

False

The courts of different states stand united in their views of what constitutes desirable public policy.

False

The doctrine of substantial performance applies when a promisor willfully fails to completely perform.

False

The intent to deceive is also known as capacity.

False

The plaintiff in a contract action has no duty to mitigate his damages because he is the injured party.

False

When a guy turns back the odometer on a car, he is guilty of:

Fraud with intent to deceive.

All of the elements of misrepresentation and the fact that the misrepresentation was knowingly made with the intent to deceive, have to be established to prove:

Fraud.

In general, if the offer uses a means of acceptance that is slower than that used by the offeror to communicate that offer:

It is an unauthorized means of communication.

When interpreting contracts, courts:

Give ordinary words their usual meaning.

When one guy convinces another guy to buy a preowned car from him, while withholding the fact that the car had a mechanical problem, it indicates:

Guilty knowledge. You know what you're doing wrong. Scientor.

An acceptance is effective as soon as it is dispatched:

If the offeree uses an authorized as well as the stipulated means of communication.

Who among the following cannot enforce a contract?

Incidental beneficiaries.

In general, performing a preexisting duty:

Is not consideration.

Today, many courts recognize the following about the doctrine of the Caveat Emptor.

It often produces unfair results.

An agreement may be found to be void due to illegality because all of the following reasons except:

It protects the interest created by the contract to a reasonable measure.

Under the UCC, agreements to modify contracts for the sale of goods...

Needs no new consideration to be binding.

An agreement to restrain trade...

May be legal if it covers a reasonable geographic area and a reasonable time period.

A guy's duty to perform as a basketball player for an NBA team would be...

Not delegable.

What is the term used for the willingness to abide by contractual obligations?

Ratification.

If a girl buys a motor home from a guy and the guy says the home is in excellent condition but in truth knew the home had serious defects:

Rescind/Affirm contract. Sue in court for damages.

One of the primary reasons for not enforcing illegal contracts is to deter people from entering into such agreements in the first place.

True

Guy makes an oral agreement to buy a girl's boat for $700, under the UCC:

The agreement is barred by the statute of frauds.

An acceptance is valid if:

The communication by non-authorized means is effective when received.

Same consideration must be bargained for means:

The consideration given by the promisee must be the consideration the promisor requested in exchange for making his or her promise.

In a contract made by a minor:

The contract is voidable.

When a person has been adjudicated insane:

The court has appointed guardian or conservator for the person's estate.

When a minor reaches the age of majority:

The person may disaffirm a contract for a reasonable time after reaching majority.

The difference between duress and undue influence is:

The relationship between the parties at the time of the contract.

In cases involving contractual incapacity caused by insanity:

The rules regarding necessaries are basically the same as in the case of minors.

Person's who were not originally parties to a contract, may claim some interest in it as assignee's or donee beneficiary or credit beneficiaries.

True

Public policy can prevent the delegation of duties.

True

An assignor who assigns the contract will be relieved of the duty to perform to the other party on the original contract when...

There has been an novation of the original contract.

There is no voluntary consent in a mutual mistake if:

There is untrue belief by both parties about a material fact.

The type of contract required to be in writing in the exception of part performance is:

Transfers of interest in land.

A bilateral contract is a promise for a promise.

True

A contract may be enforceable if promissory estoppel applies.

True

A court will not enforce legal agreements but will leave the parties where it finds them.

True

A mutual mistake is always a ground for rescission.

True

A person who claims to have been victimized by a misrepresentation may cancel a contract only if he or she can show some detriment as a result of the misrepresentation.

True

A promisor who is guilty of material breach has no right of action under the contract.

True

As a general rule, performing a preexisting duty is not consideration.

True

Even if it was not bargained for, a promise is enforceable.

True

If time is not of the essence of a contract, the promisee must accept late performance rendered within a reasonable time of when performance was due.

True

In most states, the agreement of most persons who have been adjudicated insane are void.

True

Normally, both parties to a contract are discharged when they have completely performed their contractual duties.

True

Once a mentally impaired person regains his mental capacity, he may ratify a contract he made while he was impaired.

True

Oral contracts that come under the provisions of the statute of frauds are:

Unenforceable.

In most states, the agreements of persons who have been adjudicated insane are:

Void.

Which of the following is a true statement about exculpatory clauses?

When an exculpatory clause is enforced, it can effectively relieve a party of liability for his own negligence.