L201 Final Exam Last Class Review

Mr. Green agrees to purchase a lawn mower from Ms. White for $300. The act of payment of $300 by Mr. Green is consideration for the act of passing ownership of the lawn mower from Ms. White to Mr. Green

True: Consideration is legal value, bargained for and given in exchange for an act or a promise

Consideration can be a promise for another promise

True: Consideration can be a promise in the case of a bilateral contract

A promise to refrain from smoking can be legal consideration because refraining from a legal right, the right to smoke, can be consideration.

True: Consideration is a legal value. A promise generally cannot be enforced against the person who made it (the promisor) unless the person to whom the promise was made (the promisee) has given up something of legal value in exchange for the promisee

A condition subsequent cannot be a valid reason for the discharge of duty

False: A condition subsequent is a future, uncertain event that discharges the duty to perform. When a duty is subject to a condition subsequent, the duty to perform arises but it is discharged if the future, uncertain event occurs.

A contract in which one party to the agreement agrees to buy all of the produced goods of the other party is called a requirements contract.

False: A contract in which one party agrees to buy all of the produced goods of the other party is called an output contract

A court will enforce a noncompetition clause even if its restraints are unduly burdensome either on the public or on the party whose ability to compete would be restrained

False: A court will not enforce a noncompetition clause if its restraints are unduly burdensome either on the public or on the party whose ability to compete would be restrained

A firm offer for the sale of goods requires consideration to be given in exchange for the offeror's promise to keep the offer open.

False: A firm offer for the sale of goods needs to be made by an offeror who is a merchant, be contained by a signed writing, and give assurance that the offer will be kept open

A promise not to sue another party is not consideration, because the promise does not convey any legal value to the other party.

False: A promise not to sue another party is a valid consideration and the promisee must have good faith belief in the validity of his/her claim

Generally speaking, advertisements are considered to be offers.

False: Advertisements are not treated as offers, but as rather invitations to offer or negotiate

A noncompetition clause is also known as a "liability waver"

False: An exculpatory clause is also known as a "liability waiver" or "release"

When parties are communication face-to-face, by telephone, or any such means then communication of acceptance is instantaneous

False: An improperly dispatched acceptance or one that was sent by some means of communication that was nonauthorized would be effective only when received

Courts provide remedy for the breach of illegal agreements

False: As a general rule, courts will refuse to give any remedy for the breach of an illegal agreement

Generally, the age of majority for contracting purposes is 21 years

False: At common law, the age of majority was 21. However, the ratification in 1971 of the 26th amendment to the constitution giving 18 year olds the right to vote stimulated a trend toward reducing the age of majority

Under the theory that alcohol and drug use should not be rewarded, today most courts say that contracts made by intoxicated people are perfectly binding, no matter how severe the intoxication is

False: Contracts made under extreme conditions of intoxication are not legally binding. However, courts have always been less sympathetic about such people than with minors or those suffering from mental impairment

Courts will always enforce an exculpatory clause from a properly executed contract

False: Courts enforce exculpatory clauses in some cases and refuse to enforce them in other cases depending on the judge's interpretation of the circumstances of the case.

In a contract for Adam to sell Carrie a steam boiler, Carrie's obligation to pay is conditioned upon her personal satisfaction with the boiler. Even though the boiler meets every mechanical test imaginable, Carrie refuses to pay because she just doesn't like the boiler for some reason. She is not obligated to pay, because the contract said that she must be personally satisfied, and a contract is a contract

False: In a case like this, performance involves mechanical fitness or suitability: the court will apply a reasonable person test. Since a reasonable person would be satisfied with the boiler, Carrie is obligated to pay

Generally, if there is a good faith dispute over a matter, a person's threat to file a lawsuit to resolve that dispute is considered to be improper

False: In case of a good faith dispute over a matter, a threat to file a lawsuit is not considered to be improper

There cannot be subjective standards of personal taste and comfort when determining a promisee's performance

False: In determining which standard of satisfaction to apply, courts distinguish between cases in which the performance bargained for involves personal taste and comfort and cases that involve mechanical fitness or suitability for a particular purpose

In a strict liability case, the plaintiff must prove that the defendant breached a duty

False: In strict liability cases, the defendant is liable even though he did not intend to cause the harm and did not bring it about through recklessness or negligence

Ordinarily, contracts entered into by mentally impaired people are void, while contracts entered into by intoxicated people are voidable

False: Intoxication can deprive a person of capacity to contract. The rules governing the capacity of intoxicated persons are very similar to those applied to the capacity of people who are mentally impaired.

Offers that fail to provide a specific time for acceptance are invalid because they are deemed to be indefinite.

False: Offers that fail to provide a specific time for acceptance are valid for a reasonable period of time.

Once a contract made by a minor has been effectively ratified, it cannot be affirmed

False: Ratification ends the right to disaffirm a contract. Hence, this mechanism is only available to a person only when he/she reaches maturity

Ratification has to be expressly made only in written form

False: Ratification need not necessarily be made in writing: it can be expressed orally (or by actions) as well

The only manner in which a request for prompt or current shipment of goods can be honored is by a prompt or current shipment of the goods to the buyer

False: The Code states that an order requesting prompt or current shipment of goods may be accepted either by a prompt promise to ship or by a prompt or current shipment of current shipment of the goods.

A promissory estoppel cannot be applied in the case of the absence of a binding consideration

False: The doctrine of promissory estoppel is applied as an exception to rules of consideration. Hence, if its elements are established, a promise is binding even in the absence of a consideration.

Speaking generally, a quasi-contract applies where there has been foreseeable reliance on an express promise

False: The elements of a promissory estoppel are a promise that the promisor should foresee is likely to induce reliance, reliance on the promise by the promisee, and injustice as a result of that reliance.

A revocation is effective at the time it is dispatched by the offeror

False: The general rule of revocation is that it is effective only when it is actually received by the offeree

When determining a presence of the intent to accept, a subjective standard is used

False: The intent to accept, like the intent to contract, is judged by an objective standard.

The legal term for innocent misrepresentation is "scienter"

False: The legal term for the knowledge of falsity, which distinguishes fraud from innocent misrepresentation, is "scienter"

Article 2 of the UCC never applies to mixed goods-services contracts: instead, it treats them as pure service contracts

False: The mere fact that title to Article 2 goods changes hands during a commercial contract does not by that fact alone make the transaction a sale of goods. The mere fact that the parties' settlement agreement includes the transfer of personal property in its provisions does not make it a simple sale of goods. It is a mixed contract, similar to a mixed contract for the provision of both goods and services. It should therefore be analyzed as a mixed contract.

In a case involving an ultrahazardous or abnormally dangerous activity, the plaintiff must prove recklessness on the defendant's part. Any lower fault standard would be unfair to the defendant in such a case.

False: abnormally dangerous (or ultrahazardous) activities are those necessarily involving a risk of harm that cannot be eliminated by the exercise of reasonable care. The court will hold a defendant to a higher standard for willingly conducting dangerous conduct that the defendant knew could be potentially harmful to others.

Gross inadequacy of consideration is by itself a sufficient reason to set aside a contract

False: according to the law, gross inadequacy of consideration is never sufficient reason to prove lack of true consent or contractual capacity

When Carol Whittaker makes an offer to a contractor Jacob Phelps directing him to inform her of his acceptance through registered letter mail, she is making an ambiguous offer.

False: an offer which is unclear about the form of acceptance that is necessary to create a contract is called an ambiguous offer

Generally, the terms of a standardized contract are negotiable.

False: frequently, the terms of standardized contracts are nonnegotiable

A voidable contract creates no obligation and is not enforceable by any party.

False: voidable contracts allow the victim to cancel their rights under the contract, but until that party does so, the other party is bound to the contract and has obligations

According to the provisions of the UCC, an exclusive dealing contract imposes a duty only on the distributor to use his or her best efforts to sell the goods.

False: when a manufacturer of goods enters an agreement giving a distributor the exclusive right to sell the manufacturer's products in a particular territory, the agreement imposes sufficient obligations on both parties to meet the legal value test. The UCC imposes a duty on the distributor to sell the goods, and imposes a reciprocal duty on the manufacturer to supply the goods.

When an offer is unclear about the form of acceptance it requires, ideally it must not be accepted.

False: when an offer is unclear about the form of acceptance it requires, the offer may be accepted in any manner that is reasonable in light of the circumstances surrounding the offer

An acceptance is assent to a proposal by the offerree to the offeror

True: Acceptance is a manifestation of assent to the terms made by the offeree in the manner invited.

Mr. Green is a general contractor and is accepting bids from subcontractors for the building of a new hotel. Mr. Blue submits a bid for his work associated with the project. Mr. Green placed an offer which Mr. Blue accepted with his bid.

Advertisements for bids are generally treated as invitations to offer while those individuals that submit bids are offerors to contracts that may be accepted or not.

Courts look at parties' outward manifestations of intent as a requirement to enforce a contract. This is called the subjective standard of intent.

False: Courts look at the objective standard of intent when they try to find outward manifestations of intent.

A contract of adhesion is one that the courts will always enforce because of the strong public policy underlying such contract.

False: Courts will not enforce a contract of adhesion if it contains terms and conditions that are harsh or oppressive.

Emancipation is a formal agreement in writing to terminate a parent's right to control a child and receive services from them

False: Emancipation is a formal agreement in writing to terminate a parent's right to control a child and receive services from him. ???

A party who has the right to rescind a contract may do so at any time

False: The party that has power to rescind a contract must do within a reasonable period of time, as unreasonable delay communicates ratification of the contract.

A famous journalist predicted the result of an NBA match between the LA Groves and LA Phantoms in favor of the Phantoms, based on the present form of Groves. Accordingly, Mark placed a huge bet on the Phantoms and lost heavily. This is an example of misrepresentation of a material fact of a contract

False: There is no material fact because it is simply an opinion of a future happening that cannot be proved.

There is prescribed formal language that must be used to create an express condition as part of a contract

False: There is no particular language that has to be used to form a contractual express condition

A minor has the right to recover property transferred to third parties. This includes even good faith purchasers

False: Under section 2-403 of the UCC, a minor cannot recover goods transferred to a good faith purchaser.

Threats to institute legal actions cannot be considered improper threats that constitute duress

False: Under some circumstances, threats to institute legal actions can be considered improper threats that will constitute duress. A threat to file either a civil or a criminal suit without a legal basis for doing so would clearly be improper.

Any contract that is deemed illegal is also a criminal violation

False: When a court says that an agreement is illegal, it does not necessarily mean that the agreement violates a criminal law

All terms of contracts, even "fine- print" terms of standard form contracts, are always part of the parties' deal and binding on them, because parties have an obligation to read their contracts and are assumed to have done so.

False: a fine print version of the contract is not legally binding because contracts tend to be lengthy and time-consuming and often are not properly read.

When contracting, one party is entering into an agreement with the federal government to enforce behavior on another party

False: contracts are agreements between private parties, not with the government. Contracts let parties create a "private law".

In order to meet the requirements to form a contract the parties must have a future intent to agree and form a contract

False: for a proposal to be considered an offer, the offeror must indicate present intent to contract Present intent means the intent to enter the contract upon acceptance.

Minors have the capacity to enter into contracts

False: minors do not have the capacity to enter into contracts

Pratt, owner of an appliance store, has a garage sale at his home where he sells old furniture and books. He sells a set of books to his neighbor, Stacey. Pratt is considered a merchant under Article 2 of the UCC in selling the books to Stacey.

False: the Code defines the term merchant on a case-by case basis. if a person regularly deals in the kind of goods being sold, or pretends to have some special knowledge about the goods, or employed an agent in the sale who fits either of these two descriptions, that person is a merchant for the purposes of the contract in question. So if you buy a used car from a used-car dealer, the dealer is a merchant for the purposes of your contract. But, if you buy a refrigerator from a used-car dealer, the dealer is probably not a merchant

The Uniform Commercial Code sufficiently addresses the concerns that parties have when contracts are made to create or distribute information

False: the UCC was designed to deal with sales of goods and may not sufficiently address the concerns that parties have when making contracts to create or distribute information

The offeror's death automatically terminates an offer, but the offeree's death does not.

False: the death of either party in a deal automatically terminates an offer

To accept an offer for a bilateral contract, the offeree must perform the requested act.

False: to accept an offer for a bilateral contract, the offeree must perform the requested act ?????

The term condition means an event that may affect a party's duty to perform under a contract

True: A condition is an uncertain, future event that affects a party's duty to perform

The intention to accept an offer must be a present intent to contract

True: A court will look to see if the offeree when accepting an offer had a present intent to contract

A mistake in the principle of law will not justify a rescission in a contract.

True: A mistake in the application of law will not allow a party to rescind a contract.

Ordinarily, an item is not considered to be a necessary if a parent or guardian already supplies the minor with similar items

True: A necessary is any item that is not already provided to the minor by parents or guardians

A person who at the time of the contract lacked capacity due to mental impairment can ratify the contract once he/she regains his/her normal mental faculties

True: A person who at the time of the contract lacked capacity due to mental impairment can ratify the contract once he/she regains his/her normal mental faculties

In order for a unilateral mistake to make a contract voidable, either the nonmistaken party must have caused or had reason to know of the mistake, or enforcement of the contract must be unconscionable

True: A unilateral mistake can be reason for making a contract voidable provided it is proved that the nonmistaken party caused or had reason to know of the mistake or it would be unconscionable to enforce the contract

A minor's contract for necessaries makes the minor liable for the reasonable value of the necessaries furnished to him.

True: According to the law, a minor is liable for the reasonable value of those necessaries that he/she actually receives

Strictly speaking, a contract has nothing to do with the personal intent of the parties

True: According to the objective theory of contracts, intent is judged by objective standard

An agreement that violates legislative and court-made rules and creates threat to public policy shall be denied enforcement on the ground of illegality.

True: Agreements that are found to violate legislative and court-made rules and create threat to public policy are considered to be illegal in nature

An exculpatory clause is a provision in a contract that purports to relieve one of the parties from tort liability

True: An exculpatory clause (often called a "release" or "liability waiver") is a provision in a contract that purports to relieve one of the parties from tort liability

If Grant promises to sell his regular season football tickets to Carson on condition that IU wins the Rose Bowl, Indiana's winning the Rose Bowl is an express condition of Grant's duty to sell the tickets.

True: An express condition is a condition that is specified in the language of the parties' contract. When a duty is subject to an express condition, that condition must be strictly complied with in order to give rise to the duty to perform

An offer is the first step in the contract formation process

True: An offer is the critically important first step

In determining whether consideration exists, the law is not concerned with any disproportion in value between the things exchanged in a contract

True: As long as the promisee's act or promise satisfies the legal value test, the courts do not ask whether that act or promise was worth what the promiser gave or promised to give, in return for it.

Capacity is the ability to enter into legal obligations

True: Capacity means the ability to incur legal obligations and acquire legal rights

Minors are considered to lack capacity to contract

True: Courts have long recognized that minors are in a vulnerable position in their dealings with adults. As a result, minors are considered to lack capacity to contract

Under many "mixed" comparative negligence systems, a plaintiff recovers nothing where the plaintiff's own negligence was 50% or more responsible for the plaintiff's injury

True: Courts seek to determine the relative negligence of the parties and award damages in proportion to the degrees of negligence determined. Under a mixed system, the plaintiff recovers nothing if his/her fault was 50 percent or more responsible for the injury

The threat to institute criminal prosecution against another party in order to force that party into a contract is almost always duress

True: Duress involves the use of wrongful coercion and hence, a threat of criminal prosecution would be considered duress

John promises to pay Robert $100 per week, in exchange for Robert's promise not to beat John up. There is no consideration for John's promise.

True: Every member of society has a duty to obey the law and refrain from committing crimes or torts. Therefore, a promisee's promise not to commit such an act can never be consideration.

For a noncompetition clause to be enforceable, the clause must serve a legitimate business purpose.

True: For a noncompetition clause to be enforceable, the clause must serve a legitimate business purpose. This means that the person protected by the clause must have some justifiable interest- such as an interest in protecting goodwill or trade secrets- that is to be protected by the noncompetition clause.

A contract made by a person who has been adjudicated to be insane and institutionalized or put under a guardian's care is void rather than voidable

True: If a person has been adjudicated to be insane or institutionalized, then any contract made by the person becomes void at inception itself

If the offeree accepts the offeror's terms while complaining about them, it is called a grumbling acceptance.

True: If the offeree accepts the offeror's terms while complaining about them, it is called a grumbling acceptance.

Mr. Green agrees to an offer to drive Ms. White to the airport for $20 but only if "I feel like it". Mr. Green has failed to give sufficient consideration to create a contract with Ms. White.

True: If the promisee's promise is illusory and does not really bind the promise to do or refrain from doing anything, then it cannot serve as valid consideration

The intent to accept is objectively demonstrated by words or conduct or a combination of the two

True: Intent to accept is objectively demonstrated by words or conduct or a combination of the two.

Mutual mistake is more likely to make a contract voidable than is unilateral mistake

True: It is more difficult to prove unilateral mistakes than mutual ones, which can be easily voided

Misrepresentation can either be innocent or fraudulent

True: Misrepresentations can either be not intentionally deceptive or made with the knowledge of falsity.

In return for services Charles performed for Richard in the past, Richard promises to pay Charles $1000. There is no consideration for Richard's promise.

True: Past consideration is not consideration at all. Past consideration is an act or other benefit given in the past that was not given in exchange for the promise in question. Because the past act was not given in exchange for the present promise, it cannot be consideration.

Mr. Blue gave his favorite nephew Jim Jr, who is a mechanic, $1000 in January. Later that year he needed his car repaired. In the sales contract Mr. Blue indicated that the amount owed should be deducted from the money already paid. A court will find that Mr. Blue failed to give proper consideration for the contract

True: Past consideration was not given for the present contract and as such cannot be used as a consideration.

An individual who was intoxicated when they signed a contract can escape the contract

True: Persons intoxicated at the time of entering a contract are deemed to not have had capacity to enter into a contractual agreement and their agreement is deemed voidable

Ratification ends the right to rescind a contract

True: Ratification implies that the person who has the right to rescind the contract has elected not to do so

Reliance means that an individual acts because of an assertion of another party

True: Reliance means that a person pursues some course of action because of his faith in an assertion made to him

Sellers at public auction are treated as makers of an invitation to offer

True: Sellers at auctions are generally treated as making an invitation to offer. Those who bid on goods are, therefore, treated as making offers.

A party injured by fraud in a contract for the sale of goods can both rescind the contract and sue for damages

True: Some states have a provision where the injured party can rescind the contract as well as sue for damages

A creditor who fails to file suit to collect a debt within the time prescribed by the appropriate statute of limitations loses the right to collect it.

True: Statutes of limitations set an express statutory time limit on a person's ability to pursue any legal claim. A creditor who fails to file suit to collect a debt within the time prescribed by the appropriate statute of limitations loses the right to collect it

An advertisement offering a reward for the return of lost property is usually treated as an offer for a unilateral contract

True: Such an advertisement is considered an offer for unilateral contract which can be enforced only if the offeree performs the stated act

Sometimes, Article 2 of the UCC holds merchants to standards different from the standards it applies to non-merchants

True: The Code recognizes that buyers tend to place more reliance on professional sellers and that professionals are generally more knowledgeable and better able to protect themselves than nonprofessionals. So, it distinguishes between merchants and non-merchants by holding merchants to a higher standard in some cases.

Mr. White sends his acceptance for a business contract to Mr. Green. But Mr. White put insufficient postage on the envelope. One day later Mr. Green revokes the offer through the mail. Mr. White upon receipt of the undelivered acceptance, Mr. White overnighted the acceptance letter to Mr. Green. The court will find if it applies the UCC rule that a valid acceptance occurred and subsequent contract is now created between Mr. White and Mr. Green.

True: The UCC provides that an acceptance sent by an unreasonable means would be effective on dispatch if it is received within the time an acceptance by reasonable means would not have arrived.

The UCC often creates contractual liability in situations where no contract would have resulted at common law

True: The UCC, with its increased emphasis on furthering people's justifiable expectations and its encouragement of a hands-on approach by the courts, often creates contractual liability in situations where no contract would have resulted at common law.

Ratification makes a contract valid from its inception

True: The act of affirming the contract and surrendering the right to avoid a contract is known as ratification. Ratification makes a contract valid from its inception.

Concealment involves the active hiding of a fact, whereas nondisclosure is the failure to volunteer information

True: The difference between concealment and nondisclosure is that while the former is deliberate, the latter is the failure to volunteer information

Michael and William contracted for Michael to mow William's lawn once a week for 20 weeks, at a price of $20 per week. Later, without terminating the first contract, the parties modify the contract as follows: Michael will mow William's lawn in exactly the same way for exactly the same time period, in exchange for William's promise to pay Michael $22 per week. There is no consideration for William's promise.

True: The general common law rule on contract modifications holds that an agreement to modify an existing contract requires some new (independent) consideration to be binding. Therefore, if Michael and William have not made a new contract, there is no consideration.

Ms. pink offers to landscape Mr. Green's yard for $100. Mr. Green is planning to say yes but before he has a chance to communicate with Ms. Pink he receives a text message from Ms. Pink indicating she has rescinded her offer due to her being too busy. Ms. Pink has effectively revoked her offer.

True: The general common law rule on revocations is that offerors may revoke their offers at any time prior to acceptance

Bob offers to sell his bike to Sue for $100, and promises to keep his offer open for five days. Sue thanks him and leaves. At this point, Bob still has the power to revoke his offer.

True: The general rule for the revocations states that the offeror has the power to revoke an offer even if there is a stipulated time period.

The offeror is said to be the "master of the offer". This means that offerors have the power to determine the terms and conditions under which they are bound to a contract.

True: The offeror is said to be the "master of the offer." This means that offerors have the power to determine the terms and conditions under which they are bound to a contract.

The only person with the legal power to accept an offer and create a contract is the original offeree

True: The only person with the legal power to accept an offer and create a contract is the original offeree

The term rescind means to end a contract

True: The power to rescind a contract means to cancel it

Duress involves threats and coercion while undue influence involves persuasion to susceptible individuals

True: The term undue influence means to use persuasion over vulnerable individuals to form or modify a contract while duress involves threats by party to another

In recent times, the mirror-image rule is applied such that only a material difference between offer and acceptance creates a rejection of the offer.

True: The traditional contract law rule is that acceptance must be the mirror image of the offer. In recent years, courts have applied a more liberal approach to this by stating that only material variances between an offer and a purported acceptance result in an implied rejection of the offer.

The traditional rule is that, when the consideration given by the adult party under a minor's contract has been lost, stolen, or dissipated, the minor can disaffirm without compensating the adult for the loss in any way.

True: The traditional rule has been not to let a minor make restitution to injured adults: however, some states allow such injured adults the remedy of the tort of deceit

The UCC sections 2-207 allows a contract to be formed even though the terms of the offer and the terms of the acceptance differ

True: This section 2-207 allows the formation of a contract even when there is some variance between the terms of the offer and the terms of the acceptance

To encourage people to cancel illegal contracts, courts will allow a person who rescinds such a contract before any illegal act has been performed to recover any consideration that he has given

True: To encourage people to cancel illegal contracts, courts will allow a person who rescinds such a contract before any illegal act has been performed to recover any consideration that he has given

Transfer of title deeds is a function wherein silence signals acceptance of the offer

True: Transfer of title deeds is a function wherein silence signals acceptance of the offer

Mr. Blue and Mr. Green are in negotiations for a regular delivery of newspapers to Mr. Blue's business. Mr. Blue did not formally announce his acceptance to the offer. But when Mr. Green sent a shipment of newspapers as had been agreed, Mr. Blue accepted the shipment and paid for them. According to the UCC Mr. Blue and Mr. Green have an enforceable contract.

True: UCC Section 2-204(2) states that if the parties are acting as though they have a contract by delivering or accepting goods this will be enough to create a binding contract.

The rule on adequacy of consideration reflects the laissez-faire assumption of freedom of contract

True: the rule on adequacy of consideration reflects the laissez-faire assumption of freedom of contract. The freedom of contract includes the freedom to make bad bargains as well as good ones, so promisors' promises are enforceable if they got what they asked for in exchange for making their promises irrespective of the actual value of the exchange

Mr. White contracts with Mr. Green for 100 black coffee mugs for a party. Mr. White decides he needs the mugs faster than the time allotted in the contract, and asks for a rush shipment. Mr. Green notifies Mr. White that he will ship 100 coffee mugs but that the only ones available are red. A court will find that the shipment of red mugs under the UCC is not a breach of the original agreement.

True: Under the UCC a requested rush shipment of nonconforming goods to a contract is not a breach of the contract but a counteroffer by the seller that the buyer is free to accept or reject

Under the doctrine of unconscionability, the courts would refuse to grant the equitable remedy of specific performance for breach of contract if the contract is oppressively unfair

True: Under the doctrine of unconscionability, the courts would refuse to grant the equitable remedy of specific performance for breach of contract if the contract is oppressively unfair

Undue influence cases often involve a relationship of trust and confidence between the contracting parties.

True: Undue influence cases generally involve a relationship of trust and confidence where people are often in a vulnerable position to enter a contract

Even if both parties consent to an agreement, if a court finds the agreement illegal then it will not enforce it

True: When a court finds that an agreement is illegal, despite the parties consenting to it, the court will not enforce the agreement

Pat promises to install granite countertops in the home at 123 Main Street that Bruce is purchasing "provided that the escrow on the sale of 123 Main Street Closes" The close of escrow on the sale of 123 Main Street is a condition precedent to Pat's promise

True: When a promisor's duty is conditional, his duty to perform is affected by the occurrence of the condition

Acceptances by instantaneous forms of communication are effective immediately upon communication to the offeror.

True: When parties are communication face-to-face, by telephone, or any such means then communication of acceptance is instantaneous.

Alan and Ben have a contract. Alan has performed 100 percent and Ben has performed 50 percent of it. This contract is now executory.

True: a contract is executed when all of the parties have fully performed their contractual duties, and it is executory until such duties have been fully performed

A contract may be voidable even if the person making the misrepresentation believes in good faith that what he/she says is true

True: a misrepresentation made in good faith is considered an innocent representation and can be rescinded

The three requirements for a valid offer are: present to intent to contract, definiteness, and communication to the offeree

True: a valid offer needs to have all three elements

If no Code rule applies to an issue regarding a sale of goods contract, the common law rules apply.

True: article 2 of the UCC applies to contracts for the sale of goods, but it does not apply to contracts for the sale of real estate, services, and intangibles which are governed by the common law of contracts

Kevin offered to mow the lawn for his Uncle Jordan's for $100. To his offer, Uncle Jordan replied by saying "I know you're taking advantage of me but I accept." Uncle Jordan has indeed accepted the offer made by Kevin

True: as soon as the offeree states, "I accept" or words to that effect, the contract is made, provided that the offer still exists.

Promissory estoppel protects reliance on a promise from one party to another

True: contracts are thought of as protecting agreements while promissory estoppel protects reliance on promises

If a term is left open in a sale of goods contract, that open term or "gap" can be filled by inserting a presumption found in the UCC's "gap-filling" rules

True: if a term is left open in a contract that meets these two standards, that open term or "Gap" can be "filled" by inserting a presumption found in the code's "gap-filling" rules.

In some states that have eliminated assumption of risk as a separate defense; assumption of risk reappears as one of the many kinds of fault that a court must weigh in applying the state's comparative fault defense

True: in a comparative fault state, therefore, the fact-finder determines the plaintiff's and the defendant's relative shares of the fault- including the assumption of risk- that caused the plaintiff's injury

Abby promises to pay Brian $50 if he mows her lawn. Brian does not promise to mow Abby's lawn; however later that day, Brian completely and satisfactorily does mow Abby's lawn. This is an example of a unilateral contract.

True: in unilateral contracts, only one party makes a promise.

Not every promise is legally enforceable.

True: not every promise is legally enforceable, the law of contracts sorts out what promises are enforceable and how they will be enforced

Ms. White hired Mr. Blue to steal from Ms. Yellow. Ms. White is upset with how everything turned out and wants to sue Mr. Blue for breach of contract. But the court will refuse to recognize the contract and subsequently a breach of it because it is a contract for an illegal activity.

True: parties cannot contract for illegal activities. A court will not recognize or enforce such a contract.

Generally speaking, the UCC's rules for the definiteness of an offer make it easier to form a contract than traditional common law rules.

True: the UCC rules for the definiteness of an offer are more liberal than the traditional common law rules

Consideration is what distinguishes enforceable agreements from gratuitous promises

True: the concept of consideration distinguishes agreements that the law will enforce from gratuitous promises

The UCC imposes a duty of good faith on the performance and enforcement of every contract it covers

True: the drafters of the Code wanted to promote fair dealing and higher standards in the marketplace, so they imposed a duty of good faith in the performance and enforcement of every contract under the Code

The essence of a contract is that it is a legally enforceable promise or set of promises.

True: the essence of a contract is that it is a legally enforceable promise or set of promises. In other words, when a set of promises has the status of contract, a person injured by a breach of that contract is entitled to call on the government (courts) to force the breaching party to honor the contract.

To accept an offer for a unilateral contract, the offeree must make the promise requested by the offeror

True: to accept an offer for a unilateral contract, the offeree must perform the requested act.