GBUS2003 - Module 4

A joint contract is one in which:

each obligor is bound for the performance of the entire obligation

Blake agreed to renovate Jane's house, and they drafted a written contract. However, Blake was unable to complete the renovation due to an accident. Blake's friend, Tom, agreed to complete the job, and Jane agreed to release Blake from the contract. The terms of the old contract remained the same. This process of substitution of a contract is known as a(n) _____. ​

novation

What is the Statute of Frauds?

​It is a law requiring certain contracts to be put in writing.

Which of the following statements best describes the term "assignment"?

​It is the conveyance of rights in a contract to a person who is not a party.

Which of the following warranties does an assignor make when he assigns rights under a contract to an assignee for value?

​That there are no defenses available to the debtor that have not been disclosedto the assignee

In which of the following cases will a court refuse to enforce the provision of liquidated damages on a party?

When the amount of liquidated damages fixed by the contract is unreasonable

When a party sues to enforce an alleged contract, the Statute of Frauds requires that:

there be a note in writing signed by the party against whom the claim for breach of contract is made

An donee beneficiary is best described as a person:

who is a third-party beneficiary and for whom performance is a gift.

When an assignment is made by an act of the parties, which of the following is true?

​If the original contract was required be in writing, the assignment must also be in writing.

​Which of the following is true of the parol evidence rule?

​It allows a written contract to be modified by oral testimony if there is evidence of fraud.

Parol evidence refers to:

​spoken words.

An offer to pay money in satisfaction of a debt or claim when one has the ability to pay is a ____.

​tender of payment

A person not party to contract but whom parties intended to benefit is known as a(n) _____.

​third-party beneficiary

Which of the following is an example of a contract discharged by impossibility of performance?

A new law makes the contract illegal.

Which of the following types of agreements according to the Statute of Frauds need to be in writing?.

An agreement containing a promise in consideration of marriage

Which of the following constitutes an exception to the Statute of Frauds requirement that a contract be in writing?

An original promise from the promisor rather than a promise to pay the debt or another

AB Developers signs a contract with CL Corp., agreeing to build a $20 million office for the corporation. The construction contract was substantially performed. There were, however, a few minor breaches of the contract by AB Developers that made CL Corp. incur damages worth $10,000. Which of the following is most likely to be true in this scenario?

CL Corp. needs to pay the full price under the contract less the damages suffered by it.

Which of the following statements is true of statutes of limitations?

In the case of running accounts, such as purchases from department stores, the statute starts from the date of the last purchase

Which of the following statements best describes a several contract?

It is a contract where two or more people individually agree to perform an obligation.

Which of the following statements best describes specific performance?

It refers to the carrying out of the specific terms of a contract.

When a contract contains the words "time is of the essence," which of the following is true?

Performance on the exact date is deemed vital

Which of the following is an advantage of a written contract over an oral one?

The existence of a contract cannot be denied if it is in writing

​Default refers to:

a breach of any contractual obligation

A force majeure clause in a contract is a contract provision that excuses performance by a party when:

an extraordinary event outside the party's control occurs.

In a written contract, Sheldon agreed to tutor the children of Mrs. Smith for a certain period of time. However, Sheldon, prior to starting classes, announced that he would not be able to tutor the children due to other commitments of his. In this case, there has been a(n):

anticipatory breach