BUL 3310 Unit 6 Chapter 13 & 15

Which of the following is an illusory promise? "I will buy tickets to the World Series if the Red Sox win the Pennant." "I will go with you to the donkey basketball game if I can't think of anything better to do." "I will drive you to work if your car is still in the repair shop." "I will buy your car if my husband likes it."

"I will go with you to the donkey basketball game if I can't think of anything better to do."

How is promissory estoppel best described? A contract remedy for breach of bilateral contracts A contract remedy for breach of unilateral contracts An equitable remedy when an accord and satisfaction fails An equitable remedy when one party suffers an unbargained-for detriment

An equitable remedy when one party suffers an unbargained-for detriment

Which of the following is a requirement for a valid contract? Offer and acceptance Consideration Legal capacity of the parties All of the above are elements of a valid contract.

All of the above are elements of a valid contract.

What does consideration in a bilateral contract always involve? A legal benefit and a legal detriment A legal detriment and a legal impediment A legal benefit and a legal waiver A legal waiver and a legal renunciation

A legal benefit and a legal detriment

Nominal Damages

A small amount of damages awarded by a court when a wrong / breach has been committed but no dollar amount of damages were actually incurred

Which of the following is not an element of a valid contract? Agreement Consideration Legal capacity of the parties to the contract A written document with notarized signatures All of the abovee are elements of a contract

A written document with notarized signatures

Ellen has a contract with Sue to buy her riding lawn mower for $200. Ellen has given Sue $200 in cash and Sue has given Ellen possession of the mower. The status of this contract between Sue and Ellen is __________________. Executory Executed Illusionary Adhesionary

Executed

Ellen has a contract with Sue to buy her riding lawn mower for 200. Ellen has given Sue 200 in cash, and Sue has given Ellen possession of the mower. What is the status of this contract between Sue and Ellen? Executory Executed - not executed Illusionary Adhesionary

Executed

What is another term for punitive damages? Criminal Exemplary Nominal Liquidated

Exemplary

A plaintiff may be awarded either compensatory damages or consequential damages, but not both. True False

False

An illusory promise is consideration for a unilateral contract, but not for a bilateral contract. True False

False

Contracts in which both sides have completely performed their duties are executory. True False

False

Courts do not enforce output contracts as a matter of public policy. True False

False

Courts do not enforce output contracts as a matter of public policy. True False

False

Damages that involve only a very small monetary award are called liquidated damages. True False

False

Damages that involve only a very small monetary award are called liquidated damages. True False

False

During a violent storm, Nelson saved Reggie's boat from being destroyed. Reggie was so grateful that he promised to give Nelson $100. Reggie's promise is unenforceable because it is based on moral obligation. True False

False

Legal detriments always entail economic losses. True False

False

Legal detriments always entail economic losses. True False

False

Lost profits cannot be used in calculating damages because profits are always uncertain and speculative. True False

False

Which of the following is the kind of contract in which each party offers as consideration a promise to do something? Unilateral Bi-lateral Quasi Implied in law

Bi-lateral

Mutuality of consideration is a requirement for a n_________________. Bilateral contract Unilateral contract Action for promissory estoppel Firm offer under the Code

Bilateral contract

Bay Crab Processor has a contract with Jim, a local crabber, to buy all the crabs Jim catches during the season for $35 per bushel. Which of the following actions would constitute a breach of the contract between Bay Crab and Jim? Jim sells crabs to another buyer. Jim buys crabs from other crabbers at $25 per bushel so that he can sell them to Bay Crab at the contract price of $35 per bushel. Bay Crab buys crabs from another crabber. Both A and B

Both Jim sells crabs to another buyer. Jim buys crabs from other crabbers at $25 per bushel so that he can sell them to Bay Crab at the contract price of $35 per bushel.

Nominal consideration is another term for sham consideration. True False

False

Only liquidated debts can be discharged in an accord and satisfaction True False

False

Promissory estoppel is the contract doctrine which requires that accords be in writing. True False

False

Since it is up to the parties to determine the dollar amount in a liquidated damages clause, courts will enforce any amount called for in the contract. True False

False

The Uniform Commercial Code requires that any modification to a contract for the sale of goods must be supported by new consideration. True False

False

The innocent party in a contract breach must choose between collecting punitive damages or compensatory damages because a court cannot grant both. True False

False

You make an appointment with a dentist. Upon arriving at the Dentist's office, you enter the office and receive treatment. Since you've said nothing about paying, it is not a term of the contract

False

Which of the following is NOT an element of promissory estoppel? There must be an underlying enforceable bilateral contract. The promissor must foresee that the promissee would rely on the promise. The promissee did in fact reasonably rely on the promise. All of the above.

There must be an underlying enforceable bilateral contract.

Plaintiff sued a National Football League team, alleging that she had been sexually assaulted by several team members in a hotel room after a game. Team offered the plaintiff a cash settlement in exchange for two promises: (1) plaintiff would never discuss publically the suit or the terms of the settlement; and (2) plaintiff would never again sue the team or the individual players on any claim connected with the incident. Agreeing not to exercise these legal rights constitutes ___________________. Contract modification Revocation Forbearance Accord and satisfaction

Forbearance

When there is a time is of the essence clause in a contract, the parties will normally also include in the contract a dollar amount that will be paid the innocent party each day it takes to complete the work after the contract date. This is an example of a __________________damages clause. Nominal Liquidated Consequential Compensatory

Liquidated

Brenda was the lead detective assigned to investigate the murder of a prominent local businessman. A local civic group offered a 10,000 reward to anyone who provided information leading to the arrest and conviction of the murderer. The murderer was found, tried, and convicted largely due to Brenda's efforts. Can Brenda collect the reward? Yes, this is a unilateral contract and Brenda performed the requested action. Yes, the reward was a bargained-for benefit. Yes, the civic group had both a legal detriment and a legal benefit under the contract. No, Brenda had a preexisting contractual duty to find and try to convict the murderer.

No, Brenda had a preexisting contractual duty to find and try to convict the murderer.

The person to whom an offer to form a contract is made is called the___________. Offeree Donee Offeror Obligor

Offeree

Under which of the following is a contract voidable? Consideration is missing. Agreement is missing. The contract was not executed under seal. One of the parties has the option to set aside the contract.

One of the parties has the option to set aside the contract

Under which of the following is a contract voidable? Consideration is missing. Agreement is missing. The contract was not executed under seal. One of the parties has the option to set aside the contract.

One of the parties has the option to set aside the contract.

Allison, who raises horses, promised to give her friend Gil a pony for his daughter. She advised Gil that he would need to enclose a section of his property and recommended a specific type of fencing. Gil bought the recommended materials and had the fence built on his property. Allison now refuses to give Gil the pony. Allison will be liable to Gil for the cost of fencing his property based on the theory of Contract rescission Restitution Promissory estoppel Contract modification

Promissory estoppel

Under which of the following circumstances will cashing a check marked "paid in full" create an accord and satisfaction? The check is for a lesser sum that the amount due on a liquidated debt. The check is for an unliquidated debt and both parties know of the dispute The check is for any transaction governed by the Code. The check is in payment of a court judgment.

The check is for an unliquidated debt and both parties know of the dispute

An illusory promise is created when The promise is conditional on any other event happening first. The promise is conditional on an event happening first that is outside the promissor's control. The promise is conditional on an event happening first that is totally within the promissor's control. The promise cannot be performed within 1 year of the contract date.

The promise is conditional on an event happening first that is totally within the promissor's control.

An accord and satisfaction can take place only if There are unliquidated debts based on contract or tort claims. The liquidated debts do not exceed $250,000. Promissory estoppel is not available as an equitable remedy. Court annexed arbitration fails.

There are unliquidated debts based on contract or tort claims.

Cal Contractor did extensive work renovating Hailey Homeowner's kitchen. The construction work has been completely finished, but Hailey has not yet paid Cal. This is an example of a partially executed contract. True False

True

Courts generally cannot order specific performance when the contract is for personal services because of the Thirteenth Amendment. True False

True

Excessive punitive damage awards may violate the constitutional protection of due process. True False

True

Grace has a valid contract with Al to buy a desk once owned by James Madison. Al now refuses to go through with the sale. Because the item is unique, Grace can seek a decree of specific performance to enforce the contract. True False

True

Grace has a valid contract with Al to buy a desk once owned by James Madison. Al now refuses to go through with the sale. Because the item is unique, Grace can seek a decree of specific performance to enforce the contract. True False

True

In a liquidated debt, the parties agree on the exact amount that is due. True False

True

In bilateral contracts, both parties must be bound to the contract or neither party is bound. True False

True

One method for proving that a contract has been rescinded is to tear up the contract True False

True

Parties to a contract may not offer as consideration promises to do what they are already legally required to do. True False

True

Rescission is the remedy that cancels the contract and returns each party to his pre-contract position. True False

True

Susan says to Mark, "Mark, if you mow my lawn by the end of the day, I promise to pay you $50.00." Mark mowes Susan's lawn by the end of the day. A unilateral contract has been created

True

The Uniform Commercial Code governs contracts for the sale of goods. True False

True

The Uniform Commercial Code is an important source of contract law for businesses in the United States. True False

True

The statute that requires that certain contracts be in writing is the Statute of Frauds. True False

True

To meet the element of consideration, each party to a contract must gain a legal benefit and incur a legal detriment. True False

True

Under common law, modifications to existing contracts require new consideration from each party. True False

True

Under the Code, parties may agree to modify the terms of an existing contract without providing new consideration. True False

True

Under the Code, parties may agree to modify the terms of an existing contract without providing new consideration. True False

True

You are walking down Lexington Ave and come upon a grocery stand filled with apples under a sign stating 35 cents per apple. You pick up one and take a bite. At that moment, an implied in fact contract is created, largely based on conduct.

True

Nellie Neighbor made the following offer to two students who lived next door: "I will give you each 50 if you come to my house and move some furniture for me on Saturday." This is an offer to form what type of contract? Unilateral Bilateral Adhesionary Implied in law

Unilateral

Big Oil Company has a contract with Homeowner to deliver however much heating oil Homeowner needs for the fall and winter seasons. This is an example of ____________ contract. a requirements an output a unilateral a consumer lease

a requirements

Bay Crab Processor has a contract with Jim, a local crabber, to buy all the crabs Jim catches during the season for $35 per bushel. This is an example of ___________ contract. a requirements an output a unilateral an implied in law

an output

Mutuality of consideration is a requirement for which of the following? A bilateral contract A unilateral contract An action for promissory estoppel A firm offer under the Code

A bilateral contract

Which of the following is an unliquidated debt? A mortgage for 20 years at 5.02% interest A car loan for 6 years at 2.50% interest A bill from a divorce lawyer for $8,000 that is past due, interest to run at 5%. Client is actively disputing the number of hours billed and other charges. An interest-free loan of $10,000 from Grandfather to Tim. A payment of $2,500 is to be made every June 1st for 4 years.

A bill from a divorce lawyer for $8,000 that is past due, interest to run at 5%. Client is actively disputing the number of hours billed and other charges.

Which of the following is an example of an unliquidated debt? A promissory note for the sum of 10,000 to be repaid in 6 years at 5 interest. A cell phone service contract for 29.99 per month. A bill sent to homeowner by contractor for an additional 500 for cost overruns: owner claims he will pay only 250. An installment sales contract for the purchase of a 5,000 mower with 200 down and the rest financed at 8 for 3 years.

A bill sent to homeowner by contractor for an additional 500 for cost overruns: owner claims he will pay only 250.

The purposes of nominal damages is to Compensate the non-breaching party for the loss of the benefit of the bargain. Punish and make an example of the breaching party. Determine beforehand the damages to be paid if there is a breach of the contract, Acknowledge that a right has been violated even though no monetary loss. resulted

Acknowledge that a right has been violated even though no monetary loss. resulted

Bill entered into a contract with Carl to supply him with carpeting. When Carl failed to deliver, Bill had to find similar carpeting for $5 a yard more than he would have paid to Carl. The difference between the cost of the carpet with Carl and the cost Bill had to pay can be recovered as Punitive damamges Compensatory damages Consequential damages Nominal damages

Compensatory damages

Which element of a contract is met by a bargained-for exchange? Agreement Consideration Capacity Legality

Consideration

Kelly received a cookbook in the mail that she had not ordered. The packing slip read: " Return this book to the publisher within 14 days or send $35 to the address below." She did not return the book within the 14 days and she did not send the money as requested. Is Kelly required to pay it? A. Yes, the publisher made an offer for a unilateral contract which Kelly accepted by not returning the book as instructed. B. Yes, when Kelly did not return the book her conduct created an implied-in-fact contract to which she is bound. C. Yes, there is an implied-in-law contract and Kelly must pay for the book to prevent unjust enrichment. D. No, federal law allows Kelly to treat the unsolicited book as a gift and she may do whatever she wants with it.

D. No, federal law allows Kelly to treat the unsolicited book as a gift and she may do whatever she wants with it.

Another term for promissory estoppel is Forbearance Restitution Good faith Detrimental reliance

Detrimental reliance

Steve enters into a contract with Diana for $3,000, to buy Steve's favorite drug, crack cocaine. Steve smokes all the crack cocaine and refuses to pay Diana. Diana sues Steve in Court. Diana will recover based on restitution Diana will recover based on quantum merit Diana will recover because the judge smokes crack too, and thinks it should be legal Diana will not recover because the sale of an illegal substance will not be enforceable in court

Diana will not recover because the sale of an illegal substance will not be enforceable in court

Nellie Neighbor made the following offer to two students who lived next door: "I will give you each 50 if you come to my house and move some furniture for me on Saturday." To accept this offer, what should the students do? Make an oral promise to move the furniture on Saturday. Give Nellie a written promise to move the furniture on Saturday. Wait a statutory three days after the offer, then give Nellie a written promise to move the furniture on Saturday. Go to Nellie's house on Saturday and move the furniture.

Go to Nellie's house on Saturday and move the furniture.

Which of the following is an illusory promise? I will buy tickets to the World Series if the Red Sox win the Pennant. I will go with you to the donkey basketball game if I can't think of anything better to do. I will drive you to work if your car is still in the repair shop. I will buy your car if my husband likes it.

I will go with you to the donkey basketball game if I can't think of anything better to do.

Bay Crab Processor has a contract with Jim, a local crabber, to buy all the crabs Jim catches during the season for 35 per bushel. Which of the following actions would constitute a breach of the contract between Bay Crab and Jim? Jim sells crabs to another buyer. Jim buys crabs from other crabbers at 25 per bushel so that he can sell them to Bay Crab at the contract price of 35 per bushel. Bay Crab buys crabs from another crabber. a and b are both breaches

Jim sells crabs to another buyer & Jim buys crabs from other crabbers at 25 per bushel so that he can sell them to Bay Crab at the contract price of 35 per bushel are both breaches.

Barbara sues Mike to recover $10,000 for a breach of contract. Barbara is seeking a___________________. Legal remedy Equitable remedy

Legal remedy

Typically in construction contracts there will be a provision awarding damages to the buyer at "X" amount of dollars per day for each day the builder is late in completing the work. The parties to the contract agree upon this amount in advance because they know the buyer will incur added costs, or will lose profits, because of the delay. What type of damages are these contractually fixed payments? Nominal Liquidated Punitive Compensatory

Liquidated

Plaintiff's duty to take steps to lessen the damages that result from a defendant's breach of contract is the duty to ______________. Mitigate Subrogate Abrogate Ameliorate

Mitigate

Punitive (Exemplary) Damages

Money damages awarded one party To punish the breaching party; and To deter others from such conduct in the future

Kelly received a cookbook in the mail that she had not ordered. The packing slip read: " Return this book to the publisher within 14 days or send a check for 35 to the address below." Kelly did not return the book within the 14 days and she has not sent the money as requested. Is Kelly required to pay for the cookbook? Yes, the publisher made an offer for a unilateral contract, which Kelly accepted by not returning the book as instructed. Yes, when Kelly did not return the book, her conduct created an implied-in-fact contract to which she is bound. Yes, there is an implied-in-law contract and Kelly must pay for the book to prevent unjust enrichment. No, federal law allows Kelly to treat the unsolicited book as a gift, and she may do whatever she wants with it.

No, federal law allows Kelly to treat the unsolicited book as a gift, and she may do whatever she wants with it.No, federal law allows Kelly to treat the unsolicited book as a gift, and she may do whatever she wants with it.

Jerry agreed to sell Marge 12 cartons of cigars. Jerry then watched a commercial and decided he would never sell tobacco again. Marge was able to buy the cigars from Alan for the same price. Marge sues Jerry for breach of contract. What type of damages can she recover from Jerry? Nominal Punitive Consequential Marge owes Jerry money b/c she should not smoke cigars.

Nominal

Which of the following statements about nominal consideration is correct? Nominal consideration is good to use when there are liquidated damages. Nominal consideration will support an enforceable contract. Nominal consideration is another term for sham consideration. Both A and B

Nominal consideration will support an enforceable contract.

Which of the following is false about a renunciation? Renunciations are valid in common law but not under the Code A written renunciation does not require consideration. An oral renunciation does require consideration The right that is waived in a renunciation is a contract right.

Renunciations are valid in common law but not under the Code

Big Oil Company has a contract with homeowner to deliver however much heating oil homeowner needs for the fall and winter seasons. This is an example of a(n) __________________contract. Requirements Output Unilateral Consumer lease

Requirements

What is another term for consequential damages? Punitive Liquidated Nominal Special

Special

What is another term for consequential damages? Punitive Liquidated Nominal Special

Special

The Garcia family hired Home Improvements, Inc., a local construction company, to put an addition on their home. What type of law governs the contract between the Garcia's and Home Improvement? State common law Federal common law The Uniform Commercial Code The Sarbanes-Oxley Act

State common law

Todd bought a lawn tractor from LawnToysRus. The law that governs this sales contract is State common law The Uniform Commercial Code The Convention on the International Sale of Goods Federal common law

The Uniform Commercial Code

Famous Chef told Shrimp Boat Captain: "I will buy your catch if I think the shrimp are large enough." What is the status of this promise? This is a valid promise because the chef must make the decision in good faith. This is a valid promise because the chef must make the decision in good faith. This is an illusory promise because the chef has complete control over whether or not he will keep the promise. This is an illusory promise for a contract but a valid promise for promissory estoppel.

This is an illusory promise because the chef has complete control over whether or not he will keep the promise.

. To meet the element of consideration, each party to a contract must gain a legal benefit and incur a legal detriment. True False

True

A firm offer that is in writing and signed by a merchant cannot be revoked even though the other party gave no consideration. True False

True

A renunciation is a written waiver of a right arising out of a contract. True False

True

A renunciation is a written waiver of a right arising out of a contract. True False

True

An illusory promise is not a promise at all. True False

True

Bob promises to sell Jane his Harley Davidson for $13,000, and Jane promises to pay Bob $13,000 for his Harely Davidson. This is a bilateral contract.

True

Promissory estoppel is often used in which of the following business situations? When a contractor submits a bid in reliance on the bids of his subcontractors When a businessperson reasonably relies on representations that he will get a franchise When employees rely on employer promises about pensions and benefits All of the above

When a contractor submits a bid in reliance on the bids of his subcontractors When a businessperson reasonably relies on representations that he will get a franchise When employees rely on employer promises about pensions and benefits are all situations in which a promissory estoppek is often used in business situations

When is an illusory promise created? When the promise is conditional on any other event happening first. When the promise is conditional on an event happening first that is outside the promissor's control. When the promise is conditional on an event happening first that is totally within the promissor's control. When the promise cannot be performed within one year of the contract date.

When the promise is conditional on an event happening first that is totally within the promissor's control.

Another term for promissory estoppel is ____________. forbearance restitution good faith detrimental reliance

detrimental reliance

Legal remedy

is the recovery of money