lenb contracts
the public interest
A basic test to determine whether an exculpatory clause is unenforceable is to determine whether the enforcing party engages in a business directly related to ______.
adhesion
A contract created by a party to an agreement that is presented to the other party on a take-it-or-leave-it basis is a(n) ______ contract.
necessary
A contract for a ______ is a contract that supplies the minor with the basic necessities of life.
anticompetitive
A contract in restraint of trade is also known as a(n) ______ agreement.
policy
A contract in restraint of trade violates public ______.
restrictive
A covenant not to compete is also known as a(n) ______ covenant.
majority
A disaffirmance by a minor of a contract must occur before or within a reasonable period of time of the age of _______.
voidable
A minor's contract is ______.
capacity
A person who has the legal ______ to contract is one who has the mental ability to understand his or her rights and obligations under a contract and therefore will presumably be able to understand how to comply with the terms of the agreement.
concealment
A seller removes 20,000 miles from a car odometer before selling the car to a buyer. This is known as ______.
divisible
A severable contract is also known as a(n) ______ contract.
severable
A(n) ______ contract contains multiple parts that can each be performed separately.
illegal and unenforceable
An agreement to commit a crime or tort is ______.
a buyer who relied on the seller's sales talk (also known as "puffery")
For a mutual mistake to interfere with legal consent, it must involve all but which of the following?
a contract for the sale of goods transaction that provided ambiguous bargaining power
For a mutual mistake to interfere with legal consent, it must involve all but which of the following?
intentional
Fraudulent misrepresentation is ______ misrepresentation.
void
Generally an illegal agreement is ______.
void
Generally, when an agreement is deemed illegal, courts will label the contract ______.
It becomes void.
Identify the effect of an agreement being deemed illegal.
each
If a contract is disaffirmed on the basis of intoxication then _______ party must return property or money delivered.
ratified
If a person who has reached the age of majority legally affirms a contract made as a minor, he or she is said to have ______ the contract.
capacity
In the context of a contract, ______ is the legal ability to enter into a binding agreement.
unilateral
In the context of contract formation, a ______ mistake is an error by one party about a material fact pertaining to the contract.
mutual
In the context of contract formation, a(n) ______ mistake is shared by both parties to the agreement.
concealment
In the context of contract law, ______ involves the active hiding of the truth about a material fact in a contract.
misrepresentation
In the context of contract law, ______ is an untruthful assertion by one of the parties about a material fact.
minors
One of the oldest limitations on capacity is the ability of ______ to enter into only voidable contracts.
policy
Public ______ involves both the government's concern for its citizens and the beliefs people hold regarding the proper subject of business transactions.
society
Public policy focuses on what is in the best interest of ______.
knowledge
Scienter means ______.
2-302
Section ______ of the Uniform Commercial Code addresses the enforcement of an unconscionable contract.
procedural
The absence of an opportunity for a person to read over a contract fully and ask any questions before he or she is required to sign is an example of ______ unconscionability.
unconscionable
The patently unfair nature of an exculpatory clause is closely tied to the idea of ______ contracts.
fairness
The public policy argument in favor of supporting restrictions with the sale of a business involves the ______ of the sale.
Alaska
The states most notable for casino gambling include all but which of the following?
unconscionable
The term ______ refers to the fact that the agreement in question is so unfair that it is void of conscience.
18
Today, in all but three states, a minor is someone under the age of ______.
a relationship of trust exists between the parties to the contract
Under which of the following circumstances will a court find nondisclosure in a contract as having the same legal affect as an actual false assertion?
There is a failure to correct an assertion of fact no longer true in light of events that have occurred since the agreement was initially formed.
Under which of the following circumstances will courts find nondisclosure in a contract as having the same legal effect as an actual false assertion?
will not
Understand that a court _______ void a contract for a mutual mistake of both parties.
rescinded
When a contract is voidable, it may be ______, or canceled.
scienter
When an innocent misrepresentation occurs, the person who made the false statement had no knowledge of the falsity of the claim. This means the person lacked ______.
in pari delicto
When both parties in an illegal agreement are equally responsible for the illegal agreement, the parties are said to be ______.
Undue influence
______ refers to those special relationships in which one person has taken advantage of his or her dominant position in the relationship to persuade the other person.
Emancipation
______ typically occurs when a minor moves out of his or her parents' house and begins supporting himself or herself.
Substantive
______ unconscionability involves overly harsh or lopsided substance in an agreement.
Fraud
__________ by any party as part of a contract is a basis for rescission.
indivisible
A(n) ______ contract requires complete performance by both parties, even if it appears as though the contract contains multiple parts.
justifiable
A(n) ______ ignorance of facts is one party's lack of knowledge regarding a provision of an agreement that would make it illegal.
implied
A(n) ______ ratification occurs when a former minor takes some action after reaching the age of majority that is consistent with an intent to ratify the contract.
express
A(n) ______ ratification occurs when, after reaching the age of majority, a person states that he or she intends to be bound by a contract.
The court may rewrite the contract to benefit the party that created the unconscionability.
According to Section 2-302 of the Uniform Commercial Code, which of the following judicial options is not available for a court when it finds that a contract is unconscionable?
The minor can disaffirm the contract, and the other party has no recourse.
According to the majority of jurisdictions, which of the following is an accurate statement regarding a minor's right to disaffirm a contract when the consideration he or she received has been damaged or destroyed?
One party realizes after the contract is formed that the agreement is a "bad bargain."
All but which of the following circumstances would trigger a successful request for contract rescission on grounds of duress?
One party is mistaken about a material fact pertaining to the contract.
All but which of the following circumstances would trigger a successful request for contract rescission on the basis of duress?
The injured party will always prevail in a claim against the party who made the false assertion, as a false assertion results in strict liability.
All but which of the following is an accurate statement regarding the responsibilities of the injured party in a contract when a false assertion has been made by the other party?
a mistake
In the context of contract law, which of the following terms refers to an erroneous belief about the facts of a contract at the time the contract is concluded?
constructive legal capacity
In the context of contractual capacity, which of the following is not a type of mental capacity a person suffering from a mental illness or deficiency might have?
The business is merging with a larger business.
In the context of covenants not to compete involving the sale of an ongoing business, "ongoing" refers to all except which of the following?
incompetence
Incapacity is also referred to as ______.
absent
Legal assent is ________ when a legal mistake occurs.
women
Married _______ were historical considered to have no or limited capacity to enter into contracts.
meeting
The courts insist that there must be a _________ of the minds for there be a valid contract between the parties.
nondisclosure
The failure to provide pertinent information about a projected contract is known as ______.
unconscionable
There are times when agreements are so one-sided, or heavy-handed against one party, that courts will not make the harmed, innocent person fulfill his or her contractual duties. These heavily one-sided agreements are known as ______ agreements.
a private business or an individual not important to the public interest
To be able to enforce an exculpatory clause, the party seeking enforcement must be ______.
active
To enter into a valid and enforceable agreement for services, the services that require a license must be ______ by one party to the agreement.
mutual
When both parties to a contract are mistaken about either a current or a past material fact, it is referred to as a(n) ______ mistake.
assumed
When legal assent to a contract is present both parties to a contract are ________ to have freedom to enter into the contract.
One party entered into the contract as a result of sales talk, or "puffery."
Which of the following conditions would not permit a court to invalidate a contract on the grounds of unilateral mistake?
The mistake was so serious that the contract is unconscionable.
Which of the following conditions would permit a court to invalidate a contract on grounds of unilateral mistake?
In a "no license, no contract" state, no agreement with an unlicensed professional is enforceable.
Which of the following is a correct statement regarding the enforcement of a contract with a person who is not lawfully licensed?
government regulation of specific industries
Which of the following is a main purpose of licensing statutes?
a false statement about a fact that is unimportant to the contract a preexisting commercial relationship between the parties in the agreement
Which of the following is not one of the elements required for a finding of fraudulent misrepresentation in a contract?
noncompetition in employment
Which of the following is one of the varieties of restrictive covenants?
intent to deceive
Which of the following is present when the party making the false statement in an agreement claims or implies that he or she has personal knowledge of the accuracy of the assertion?
When both parties to a contract are mistaken about either a current or a past material fact, either party can rescind the contract.
Which of the following is true when there is a mutual mistake in a contract?
a bank
Which of the following organizations would be least successful in convincing a court to enforce an exculpatory clause in its favor?
an amusement park
Which of the following parties would be most likely to convince a court to enforce an exculpatory clause in its favor?
Sabbath
______ laws are also known as blue laws.
exculpatory
An ______ clause is a statement releasing one of the parties to an agreement from all liability, regardless of who is at fault or what the injury suffered is.
substantive
An agreement in which one party has little to no legal recourse is an example of ______ unconscionability.
made either orally or in writing
An express ratification may be ______.
ratify
An implied acceptance of a contract occurs when a former minor takes some action after reaching the age of majority that is consistent with an intent to ______ a contract.
duress
Any unlawful threat exercised on a person whereby the person is forced to enter into an agreement is known as ______.
a contract for joining a school team
As a general rule in most states, which of the following contracts is a minor allowed to disaffirm?
a school club membership contract
As a general rule in most states, which of the following contracts is a minor allowed to disaffirm?
in equal fault
In pari delicto means ______.
a negligent misrepresentation
In some contract negotiations, one party makes a statement of material fact he or she thinks is true but is negligent in making the assertion. Such ______ results when the party making the statement would have known the truth about the fact had he or she used reasonable care to discover or reveal it.
high-speed Internet
In the context of a contract for a necessary, which of the following is not a necessary?
duress
In the context of a contract, ______ is found when one party in the contract was forced into the agreement by the wrongful act of another.
an innocent misrepresentation
In the context of contract law, ______ is a false statement about a fact material to an agreement that the person who made the statement believed to be true.
a mistake
In the context of contract law, ______ is an erroneous belief about the facts of a contract at the time the contract is concluded.
fraudulent
In the context of contract law, a(n) ______ misrepresentation is a false representation of a material fact that is consciously false and is intended to mislead the other party.
material
In the context of contract law, misrepresentation is an untruthful assertion by one of the parties about a(n) ______ fact.
In general, a unilateral mistake does not void a contract.
In the context of contract law, which of the following is an accurate statement regarding the legal implications of a unilateral mistake?
It is a false statement about a fact material to an agreement that the person who made the statement believed to be true.
In the context of contract law, which of the following is true about an innocent misrepresentation?
Courts are hesitant to interfere with the contract when one of the parties has a correct understanding of the material facts of the agreement.
In the context of contract law, which of the following is true about the action of courts when there is a unilateral mistake in a contract?
a mistake
Which of the following is a major obstacle to genuine assent in contracts?
undue influence
Which of the following is a major obstacle to genuine assent in contracts?
A member of a specific, protected class is involved in an agreement that contradicts a statute intended to protect the specific class.
Which of the following is a recognized exception to the general rule that an illegal agreement is void?
a contract involving one party's justifiable ignorance of facts
Which of the following is a recognized exception to the general rule that an illegal agreement is void?
a loan to a corporation
Which of the following is a recognized exception to usury law?
a small loan to a party who cannot obtain a needed loan at the statutory maximum interest rate
Which of the following is a recognized exception to usury law?
Most states with Sabbath laws allow the performance of charity work on Sundays.
Which of the following is an accurate statement regarding Sabbath laws?
Such a contract is unenforceable.
Which of the following is an accurate statement regarding a contract that is against generally accepted public policy?
Technically, a minor can disaffirm a contract for necessaries, but the minor is liable for the reasonable value of the necessaries.
Which of the following is an accurate statement regarding a minor's right to disaffirm a contract for necessaries?
A minor has the right to disaffirm a contract until a reasonable time after reaching the age of majority.
Which of the following is an accurate statement regarding a minor's right to disaffirm a contract?
Adhesion contracts usually do not allow for debate regarding the agreement.
Which of the following is an accurate statement regarding adhesion contracts?
An indivisible contract requires complete performance by both parties.
Which of the following is an accurate statement regarding an indivisible contract?
No remedy is available for such an agreement.
Which of the following is an accurate statement regarding an unenforceable agreement?
Gambling is illegal in the vast majority of states.
Which of the following is an accurate statement regarding gambling?
Parents have a legal duty to provide their children with the basic necessities of life.
Which of the following is an accurate statement regarding parental liability for the necessaries of their children?
In most states, parents are not liable for the torts of their minor children.
Which of the following is an accurate statement regarding parental liability for the torts of their minor children?
Once ratified, a contract is no longer voidable.
Which of the following is an accurate statement regarding ratification of a contract?
According to the majority rule, it does not affect the minor's right to disaffirm the contract.
Which of the following is an accurate statement regarding the effect a minor's misrepresentation of age has on his or her right to disaffirm a contract?
To be enforceable, a contract must both have a legal exchange as its subject and be able to be performed legally.
Which of the following is an accurate statement regarding the legality requirement of contract enforcement?
As a general rule, parents are not liable for the contracts entered into by their minor children.
Which of the following is an accurate statement regarding the parental liability for the contracts entered into by their minor children?
A covenant not to compete in employment contracts is legal in most states.
Which of the following is an accurate statement regarding the restrictive covenants that involve employment contracts?
Statutes prohibiting usury exist in nearly every state.
Which of the following is an accurate statement regarding usury?
An executed contract created on a Sunday can be rescinded.
Which of the following is an inaccurate statement regarding Sabbath laws?
A contract, irrespective of its legality, is enforceable.
Which of the following is an incorrect statement regarding an agreement to commit a crime or tort?
A covenant not to compete in an employment contract is not enforceable.
Which of the following is an incorrect statement regarding the enforceability of a covenant not to compete in an employment agreement?
protection of government autonomy
Which of the following is not a main purpose of licensing statutes?
consideration
Which of the following is not a major obstacle to genuine assent in contracts?
The court will declare the usurious loan void and award the debtor an equity interest in the subject lending institution.
Which of the following is not a possible legal outcome when a usurious loan is made?
a contract for the sale of alcohol
Which of the following is not a recognized exception to Sabbath laws?
A person has full capacity to enter into a contract if she suffers from a mental deficiency that prevents her from understanding the transaction.
Which of the following is not an accurate statement regarding the contractual capacity of a mentally incapacitated person?
Most states follow the Uniform Contracts Code, which addresses the effect of intoxication on contractual capacity.
Which of the following is not an accurate statement regarding the contractual capacity of an intoxicated person?
nondisclosure
Which of the following refers to the failure to provide pertinent information about a projected contract?
rescinded
Which of the following terms refers to a voidable contract that has been canceled?
Undue influence
______ assumes that the persuasive efforts of the dominant person must have interfered with the ability of the weaker person to make his or her own decision.
A negligent misrepresentation
______ is a false statement of material fact made by a party who thinks it is true but who would have known the truth about the fact had he or she used reasonable care to discover or reveal it.
Intent to deceive
______ is present when the party making the false statement in a contract claims or implies that he or she has personal knowledge of the accuracy of the assertion.
incapacity
______ is some sort of mental or physical defect that prevents a natural person from being able to enter into a legally binding contract.
Usury
______ occurs when a party gives a loan at an interest rate exceeding the legal maximum.
Gambling
______ refers to an agreement in which parties pay consideration for the chance to obtain money or property.
Procedural unconscionability
______ refers to the unconscionability that derives from the process of making a contract.
