Chapter 15 BLaw, Test 3, BUS 263 CH 12, Formation of Traditional and E-Contracts, Legal Environment of Business

Countrywide Trucking Inc. contracts with Dewey to transport crated goods to a certain destination for $5,000. Countrywide delivers the crates, but Dewey does not pay. Countrywide learns that the crates contained stolen goods. Countrywide can recover from Dewey a.the goods but not $5,000. b.$5,000, but not the goods. c.none of the choices. d.the goods and $5,000.

$5,000, but not the goods.

Megan contracts to sell Nonny her horse for $4,000. This contract will be fully discharged when Megan and Nonny a. exchange the horse for the money. b. agree that the deal is fair. c. execute a bill of sale. d. sign a receipt.

A

Data Inc. offers to provide certain services to Enterprise LLC, but mistakenly transposes some of the digits in the price so that $15,400 appears in the offer as $14,500. Enterprise accepts the written offer. Enterprise's best argument in favor of enforcement of the contract is a. a mistake of value does not afford relief from a contract. b. a bilateral mistake does not afford relief from a contract. c. the price was below the prices of comparable services. d. a unilateral mistake does not afford relief from a contract

a unilateral mistake does not afford relief from a contract

Dim threatens physical harm to force Eb to sell his Flower Shop to Dim for a below-market price. This is a. duress. b. fraudulent misrepresentation. c. mistake. d. undue influence.

duress

Eugene, an accountant, convinces his client Faye to enter into a contract to invest her savings in Gathering, a non-existent social media site. There is clear and convincing evidence that Faye did not act out of her free will. This is a. mistake. b. duress. c. fraudulent misrepresentation. d. undue influence

undue influence

Huey, a tennis pro, convinces Ian, who has no athletic ability, that he has considerable skill and induces him to pay $1,000 for tennis lessons. This is most likely a. mistake. b. fraudulent misrepresentation. c. undue influence. d. none of the choices.

undue influence

Raoul, who is Stef's guardian, convinces her to buy a certain parcel of land from Tyrone at a greatly inflated price. Raoul may be liable for a. mistake. b. undue influence. c. fraudulent misrepresentation. d. duress

undue influence

Bagels Bakery enters into a contract with Cineplex for discounted tickets for Bagels's employees. When Cineplex does not provide the tickets, Bagels enters into a contract with DigiMovies for the same service at a lower price. In a suit for breach, Bagels might be awarded nominal damages to a. establish, as a matter of principle, that Cineplex acted wrongfully. b. provide Bagels with funds for its loss of the bargain. c. provide Bagels with funds for a foreseeable loss beyond the contract. d. punish Cineplex and set an example to deter others from similar acts.

A

Baez is employed by Credit Agency Inc. On the termination of Baez's position, Credit Agency pays Baez $10,000 to agree not to disclose the employer's confidential information. Later, Baez sells the information to Debt Records LLC for $100,000. In a suit for breach, Credit Agency is most likely to recover a. all future profits from Debt Records. b. $10,000 from Baez. c. $100,000 from Debt Records. d. $110,000 from Baez.

B

Berry Farm hires Chun to repair its irrigation system on site by a certain date for $2,500, but Chun fails to perform. Berry Farm hires Diego to do the job for $2,000. In a suit for breach, Berry Farm may recover from Chun a. compensatory damages. b. nominal damages. c. punitive damages. d. nothing—there is only a technical injury.

B

A contract for a sale of land from Beachfront Properties Inc. to City Development Corporation contains an erroneous legal description. The appropriate remedy for these parties is most likely a. damages. b. specific performance. c. reformation. d. a quasi contract.

C

Baristas Union petitions the National Labor Relations Board for an election on organizing a union among the employees of Coffee Café Company. For an election to be held, the union must represent a. Coffee's best interest. b. all of Coffee's employees. c. employees whose skills, duties, and pay are similar. d. no more than 30 percent of Coffee's employees.

C

Ben makes an appointment for a $50 haircut, buys a bike for $250, and agrees to work for Coding Associates for one year for $5,000 per month, starting at the beginning of next month. To be enforceable, a writing is required for a. the appointment. b. the employment agreement. c. the purchase. d. none of the choices.

C

A body of law—formed as a result of international customs, treaties, and organizations—that governs relations among or between nations is a. national law. b. space law. c. universal law. d. international law.

D

The most common way to terminate contractual duties is by a. repudiation. b. agreement. c. failure of a condition. d. performance.

D

Under the Export Trading Company Act, U.S. banks are a. discouraged from granting credit to export trading companies. b. prohibited from lending funds to export trading companies. c.required to report financial transactions with export trading companies. d. encouraged to invest in export trading companies.

D

Analytics LLC processes misinterpreted data furnished by Botch Services to propose a marketing plan for Clientele Inc. Analytics and Clientele are both ignorant of the mistaken data. Their contract can be rescinded on the basis of a. a unilateral mistake. b. none of the choices. c. a mistake of quality. d. a bilateral mistake

a bilateral mistake

A contract that includes a bilateral mistake may be rescinded if the mistake involves a. an opinion. b. any fact. c. none of the choices. d. a material fact

a material fact

Fra enters into a contract with Global Shipping Ltd. to insure and ship a painting from Holland to the United States for a certain price. Global makes a mistake in adding the costs, which results in a contract price that is $1,000 less than the true cost. Most likely, a court would a. award damages to Fra for the mistake. b. allow the parties to rescind the contract. c. enforce the contract as is. d. award damages to Global for the mistake

allow the parties to rescind the contract

A misunderstanding concerning a basic assumption on which a contract is made will support the rescission of the deal if the mistake is a. bilateral. b. unilateral. c. lateral. d. any of the choices.

bilateral

Beryl enters into a contract with Clay for a guided tour of Deep Canyon. Clay represents that he is an experienced, knowledgeable guide, when in reality he has never been in the canyon. Most likely, Beryl a. can rescind the deal based on fraudulent misrepresentation. b. might recover damages for the mistake. c. could exert duress to obtain a new guide. d. must comply with the contract because the representation is an opinion

can rescind the deal based on fraudulent misrepresentation.

Alvin induces Beth to enter into a contract for the purchase of a Chef's Burger restaurant. Alvin knowingly misrepresents a number of material features about the restaurant and the business. When Beth discovers the truth, she can rescind the contract on the basis of a. none of the choices. b. undue influence. c. fraudulent misrepresentation. d. mistake.

fraudulent misrepresentation

Denis sells a motorcycle to Elton without disclosing that the odometer, which reads 10,000 miles, was disconnected 100,000 miles ago. Denis is most likely liable for a. none of the choices. b. puffery. c. fraudulent misrepresentation. d. mistake.

fraudulent misrepresentation

Fess convinces Gwyn to enter into a contract for the purchase of a Falafel Waffle Food Cart by knowingly misrepresenting a number of material features about the facility and the business. Most likely, Gwyn can rescind the contract on the basis of a. negligent misrepresentation. b. innocent misrepresentation. c. fraudulent misrepresentation. d. none of the choices

fraudulent misrepresentation

County Title Company processes information furnished by others to transfer title to real estate from Dali to Ezra. The furnished information is mistaken. The contract between Dali and Ezra may be rescinded because the mistake a. may be rescinded if the mistake is subject to only one interpretation. b. none of the choices c. may be rescinded because the mistake affects a third party. d. may be rescinded because the mistake is about a material fact.

may be rescinded because the mistake is about a material fact.

Bram, a salesperson for Cruisin' Motors, promises Dot a certain car will give her a "smooth ride." Bram offers a test drive, which Dot declines. She buys the car but soon realizes its suspension is in poor condition. Dot can rescind the contract on the ground of a. the car maker's undue influence. b. the salesperson's fraudulent misrepresentation. c. none of the choices. d. the buyer's mistake

none of the choices

Ralph enters into a contract with Skye to buy her land based on her assertion that the land is open to development. After the sale, Ralph learns that only a small section of the land can be built on. A local law prohibits construction on the rest of the property. Ralph can a. not avoid the contract because persons are assumed to know the law. b. avoid the contract due to fraud. c. avoid the contract due to undue influence. d. avoid the contract due to a bilateral mistake

not avoid the contract because persons are assumed to know the law

In determining procedural unconscionability, a court is most likely to consider whether a.any provision deprived one party of the benefits of the agreement. b.any provision left one party without a remedy for the other's nonperformance. c.none of the choices. d.the buyer had an opportunity to ask questions about the contract.

the buyer had an opportunity to ask questions about the contract.

Mary owns two all-terrain vehicles (ATVs), worth $1,000 and $500, respectively. Neil enters into a contract to buy "Mary's ATV" for $750. Mary believes, in good faith, that she is selling the $500 ATV. Neil believes, in good faith, that he is buying the $1,000 ATV. In this situation a. the contract is not enforceable. b. Mary is entitled to $750 for the $500 ATV. c. Neil is entitled to the $1,000 ATV for $750. d. Neil must buy both ATVs for $1,500

the contract is not enforceable

Gold Mines Inc. sells stock in a nonexistent gold mine to Harry in violation of a blue-sky law. Harry can sue the seller to recover a.the profit that the seller realized from all investors in the mine. b.the purchase price of stock. c.nothing. d.the value of the investment if it did exist.

the purchase price of stock.

Discharging a contract by executing a new agreement with performance different from what was originally promised is a. an accord and satisfaction. b. a novation. c. a material breach. d. substantial performance.

A

Emil enters into a contract to buy Foley's cultivated bottomland if County AgriCredit will lend Emil the funds to pay for the land. Emil's duty to perform is a. conditional. b. commercially impracticable. c. substantial. d. absolute.

A

Flower Workers Union represents the employees of Garden Variety Inc. The company does not require its new hires to join the union as a prerequisite to obtaining employment. This most likely violates a. no federal law. b. the Fair Labor Standards Act. c. the Labor-Management Relations Act. d. the Norris-LaGuardia Act.

A

If performance under a contract will vary materially on a delegation of its duties to a third party from that expected by the obligee, the delegation is a. prohibited. b.permitted if the performance does not require the obligor's personal skill. c. permitted if special trust has been place in the obligor. d. permitted on sufficient notice by the obligor.

A

Iggy and Jon sign a contract by which Iggy agrees to deliver and install a gas fireplace on October 15 in exchange for Jon's promise to pay the $500 price within ten days of the install date. The delivery and installation of the fireplace and the payment of the price are examples of a. concurrent conditions. b. conditions precedent. c. implied conditions. d. conditions subsequent.

A

Interstate Commodities Inc. keeps a file of I-9 verifications forms, which are required by the Immigration Reform and Control Act. To monitor compliance with the act, random audits and enforcement actions are conducted by a. the federal government. b. the governments of interested foreign nations. c. the government of the state in which the company is based. d. the local office of the National Labor Relations Board.

A

Merl buys a tablet for $500, running shoes for $200, and a set of the Game of Crowns books for $100. To be enforceable as a contract, a writing is required for the purchase of a. the tablet only. b. the shoes and the tablet only. c. the books, the shoes, and the tablet. d. the books only.

A

Retail Operations, Inc., a U.S. firm, obtains a judgment in a U.S. court against Shinobu, Ltd., a Japanese business. Whether the court's judgment will be enforced by a court in Japan depends on the Japanese court's application of a. the principle of comity. b. the act of state doctrine. c. the doctrine of sovereign immunity. d. the Foreign Sovereign Immunities Act.

A

The rights under an insurance policy can normally be assigned a. if the assignment involves only a payment of benefits. b. if the assignment significantly alters the duties of the insurer. c. under no circumstances. d. if the assignment significantly changes the risk to the insurer.

A

To create a valid delegation of duties requires a. the delegator's expressed intent to make the delegation. b. the delegator's use of the word delegate. c. none of the choices. d. a special form.

A

Ziplines Inc. enters into a contract to employ Scot as a manager for two years. If Ziplines breaches the contract, Scot has a duty to a. reduce the damages that Scot might otherwise suffer. b. rescind the contract with Ziplines. c. do nothing. d. act to punish Ziplines as an example to deter others from similar acts.

A

Coffee Company, a U.S. firm, owns property in the Dominican Republic. When the Dominican government seizes the property, the company asks a U.S. court to order the property's return. The court rules that the Dominican Republic is exempt from the court's jurisdiction. This is an application of a. a coercive action. b. the doctrine of sovereign immunity. c. the act of state doctrine. d. the principle of comity.

B

Consolidated Corporation, a U.S. firm, wishes to participate, but limit its involvement, in Middle Eastern markets. Consolidated empowers Doha Ltd., an Egyptian firm, to enter into contracts in certain countries on behalf of Consolidated. This is a. a distribution agreement. b. an agency relationship. c. indirect exporting. d. direct exporting

B

Gina enters into a contract to buy a commercial building from Hope for a certain price subject to an appraiser's evaluation of the structure's condition. If the appraiser deems the condition to be substandard, the parties' obligations will be a. altered. b. discharged. c. unaffected. d. breached.

B

Quinn and Ruth orally agree on the sale of Seafood Shippers Inc. and jot down the terms on the back of one of Seafood's blank invoices, which they both sign. A written memorandum evidencing an oral contract that would otherwise be unenforceable must contain a. the preliminary terms. b. the essential terms. c. all terms. d. the quality terms.

B

Rene contracts with Scot to pay him $5,000 for repairs to Rene's lake cabin. After Scot performs, Rene tells him that she cannot pay him in full immediately. They sign an agreement in which Rene promises to pay $2,500 now instead of $5,000 later. This is a. specific performance. b. an accord and satisfaction. c. a novation. d. a mutual agreement to rescind.

B

Rita contracts to work for Social Media Corporation (SMC) during April for $4,500. On March 31, SMC cancels the contract. Rita declines a similar job with Tech Talk, Inc., which would have paid $3,500. Rita files a suit against SMC. As compensatory damages, Rita can recover a. $4,500. b. $1,000. c. $0. d. $3,500.

B

Rocco orally agrees to sell his Spring Beverage Company to Thirsty Inc. Rocco notes the terms on a sheet of Spring stationery and signs it. This agreement is most likely enforceable against a. Spring and Thirsty. b. Rocco. c. no one. d. Thirsty.

B

Technicians Union represents the workers of United Engineering Inc. The union and the employer bargain in good faith but are unable to reach an agreement because of genuine differences of opinion. The union may call a strike a. under no circumstances. b. if the parties are deadlocked. c. if the negotiations are ongoing. d.if the subjects of bargaining include working conditions and worker pay.

B

The rights under a contract for personal services can normally be assigned a. if the contract is executory. b. if all that remains on the deal is a payment of money. c. if the personal services are unique to the party rendering them. d. under no circumstances.

B

Under the Outer Space Treaty, with respect to a space object and the personnel aboard it, the launching state a. grants political autonomy to those aboard the object. b. retains complete jurisdiction and control. c. forfeits supervisory authority to the United Nations. d. shares dominion and responsibility with the United Nations.

B

Venezuela seizes the assets of World Oil, Inc., a U.S. firm. World Oil's recovery from Venezuela in a U.S. court may be prevented by a. the doctrine of sovereign immunity. b. the act of state doctrine. c. a court in Venezuela. d. the principle of comity.

B

Blue Space Corporation launches exploratory space flights to the moon and Mars. The purpose is to discover and retrieve minerals and other resources. Under U.S. Law, Blue Space a. cannot legally retrieve resources in space. b. must share with all interested parties what it retrieves in space. c. owns what it retrieves in space. d. cannot profit from resources retrieved in space.

C

Builders Corporation files a suit against Concrete Company to enforce a written contract. If the court finds that the parties intended the contract to be the final statement of their agreement, parol evidence can be admitted to prove a.terms discussed at the time of the contract that contradict the writing. b. terms discussed before the contract but not contained in it. c. an orally agreed-on condition. d. nothing.

C

Comida de Chile S.A., an export company in Chile, and Deli Source Inc., an import firm in the United States, enter into a contract. When Deli breaches the contract, Comida obtains an award of damages in a Chilean court. Comida then asks a U.S. court to enforce the award. The U.S. court defers to and enforces the Chilean court's decree. This is an application of a. the doctrine of sovereign immunity. b. the act of state doctrine. c. the principle of comity. d. none of the choices.

C

Dick's Burgers enters into an oral contract with Equipment Warehouse for the purchase of a single-spindle milkshake mixer for $300. Assuming the terms can be proved, the contract is enforceable by a.any third party with a material interest, such as one of Dick's suppliers. b. the manufacturer of the mixer. c. Dick's or Equipment. d. none of the choices.

C

Finance Accountants, P.A., is a private employer. In most circumstances, federal law generally prohibits Finance from subjecting its employees to a. electronic monitoring. b. drug tests. c. lie-detector tests. d. none of the choices.

C

For a price, Rose agrees to unload the catch from fishing boats that dock at Seafood Shipping. Rose delegates this duty to Tina, who then owes performance of the duty to the warehouse. Tina is a. a third party beneficiary. b. the obligor. c. the delegatee. d. the obligee

C

Fred agrees to assume a debt owed by Guitars Inc. to Home Bank. The agreement is not in writing. To be enforceable under the "main purpose" rule, the promise must be for the benefit of a. Guitars Inc. b. Home Bank. c. Fred. d. any third party, such as a Guitars Inc. customer.

C

Generally, the duties under a contract can be delegated a. unless the rights under the contract have previously been assigned. b. unless the delegation involves only a payment of money on the deal. c. unless the contract expressly prohibits delegation. d. under no circumstances.

C

Investment Corporation wants to monitor business communications on phones that the employer provides to the employees. The employer's best course of action to avoid liability under laws related to employee monitoring is to inform a. the public generally. b. its clients and others who communicate with the employees. c. its employees. d. no one

C

Jim and Kelly agree that Jim will fix the refrigeration unit in Kelly's Lunch Café in exchange for her payment of a debt that Jim owes to Money Corporation. Under this contract, the intendedbeneficiary is a. any customer, client, or employee of Lunch or Money. b. Jim. c. Money. d. Kelly.

C

Luke takes temporary family leave from his job at Metal Works Corporation to arrange for child care and deal with financial and legal matters when Nancy, his spouse, a U.S. Marine on active duty, is deployed overseas. On Luke's return from the leave, Metal Works must a. promote him to the status of a key employee. b. do nothing. c. restore him to his same position or a comparable position. d. reimburse him for his expenses while on leave.

C

Metro Holdings Inc. contracts to sell a commercial parking garage to New Property LLC. The contract provides that if Metro does not close the deal by a certain date, it must pay the buyer one-half of the value of the property. This provision is not enforceable if it is a. a reasonable estimate of the loss on the breach. b. intended to quickly provide cash to New Property. c. designed to penalize Metro. d. meant to pay for additional work in the event of damage.

C

Rico works for Street Tacos Inc. The basis for Rico's contribution under the Federal Insurance Contribution Act to help pay for benefits that will partially make up for his loss of income on retirement is a. his special job skills. b. an equitable share of his employer's unpaid contribution. c. his annual wage base. d. the employer's adjusted gross profits.

C

Shuster's lease of retail premises from Thurgood requires Shuster to pay certain fees, subject to the landlord's proof of the correct amount. Thurgood overcharges Shuster for the fees, without explanation. Most likely, the tenant can rescind the lease a. under no circumstances. b. after paying the overcharge. c. with prompt notice. d. by finding a new tenant for the premises.

C

Sparkling Jewelers breaches its lease with Town Mall and vacates the premises six months before the end of the term. In some states, the mall would be required to a. sell the premises to recover any damages. b. relet the premises to recover any damages. c. use reasonable means to find a new tenant. d. avoid reletting the premises for six months to recover damages.

C

Under a contract, an assignment of negotiable instruments a. can be prohibited only by the obligor. b. can be prohibited only by an anti-assignment clause. c. is prohibited under any circumstances. d. cannot be prohibited.

C

ActioNOW and Becca enter into an oral contract in which Becca agrees to work on a project for ActioNOW for eighteen months. This contract is enforceable by a. ActioNOW. b. any third party, such as ActioNOW's clients. c. Becca. d. none of the choices.

D

Architects LLC enters into a contract with Barns & Silos Inc. to provide designs for a certain number of farm buildings. Architects provides fewer than half of the designs by the time specified in the contract because the firm is busy with other projects. Architects' performance is most likely a. a reasonable breach. b. a minor breach. c. no breach. d. a material breach.

D

Beau borrows $15,000 from Credit Center to buy a car. The lender assigns the right to receive the loan payments to Debt Collections Inc. If Beau does not pay the debt, the assignee can a. none of the choices. b. extinguish the contract rights of the assignor. c. demand performance of the deal from any of the original parties. d. enforce the payment in court.

D

Commercial Rebuild LLC enters into a contract to remodel Dockside Marina, agreeing to use only products from Eagle Supplies. Halfway through the project, Commercial refuses to finish the job. The contract can be enforced against Commercial by a. Eagle only. b. Dockside only. c. any interested third party, including a contracting party's employee. d. Dockside or Eagle.

D

Dairy Farm enters into a contract with Edible Ice Cream Inc. to supply milk. Later, Dairy decides that it is no longer advantageous to fulfill the contract and subsequently fails to perform as promised. Edible files a suit against Dairy. A breach occurred when Dairy a. decided that it was not advantageous to fulfill the contract. b. entered into the contract. c. was sued by Edible. d. failed to perform as promised.

D

Federal overtime provisions apply only after a covered employee works more than a. eight hours in a day. b. one year for the same employer. c. twenty days in a month. d. forty hours in a week.

D

Lana agrees to work as Michelle's personal assistant for one year but dies in the ninth month of the contract. Lana's death a. suspends performance of the contract. b. breaches the contract. c. requires Lana's estate to pay damages. d. discharges the contract.

D

Lunchies Corporation, a U.S. firm, signs a contract with Manger au Brasserie, S.A., a French firm, to give Manger the right to use the Lunchies trademark in restaurants in France. This is a. a distribution agreement. b. direct exporting. c. indirect exporting. d. licensing.

D

Max orally agrees to construct two outbuildings on Ned's ranch for a stated price. Max performs, but Ned does not pay. To recover on a theory of quasi contract, Max must show that if Ned were allowed to retain the benefit of their bargain, Ned would a. be restored to the status quo. b. profit from Max's performance. c. obtain a reasonable exchange of values. d. be unjustly enriched.

D

Nate promises to pay for medical services provided by Otto to Polly. Nate receives no personal benefit for the promise. To be enforceable, the promise must be in writing if a. Nate assumes primary financial responsibility for the cost. b. Polly also promises to pay. c.Otto's services will be provided in installments with separate payments. d. Nate promises to pay only if Polly does not pay.

D

Rye agrees to sell his Taco Delight restaurant to Sati. The parties intend their written contract to be a final statement of the terms of their agreement. Later, the parties dispute some of the provisions. In litigation, Sati offers evidence to contradict the written terms. Most likely, the court will a. dismiss the case. b. reform the written terms to match the evidence. c. strike a balance between the evidence and the written terms. d. exclude the evidence.

D

Salsa Inc. employs three hundred workers at four locations in two states. Under federal law, Salsa must provide each employee, during any twelve-month period, family or medical leave of a. up to twelve pay periods. b. up to twelve days. c. no limited duration. d. up to twelve weeks.

D

Car Lot's salesperson Dirk offers to sell Espy, who is twenty years old, a car. Dirk intentionally misrepresents the vehicle's use and repairs. In reliance, Espy buys the car. To prove fraud, Espy does not have to show that a. Espy justifiably relied on Dirk's misrepresentation. b. Dirk intentionally deceived Espy. c. Espy is under twenty-one. d. Dirk misrepresented material facts

Espy is under twenty-one

In selling a 300-acre tract to Organic Farm, Peyton tells the buyer that the land "will be worth twice as much by next year." This statement is not likely to support rescission of the contract because it is a. a material fact. b. an opinion. c. a mistake. d. a misrepresentation.

an opinion

Hua applies to Inventory Corporation for a position as a coder. Hua has no training in coding. After Hua is hired, Inventory learns the truth. The employer can rescind the contract on the basis of a. mistake. b. fraudulent misrepresentation. c. none of the choices. d. undue influence

fraudulent misrepresentation

Luc, a vehicle dealer, offers to sell Mel a truck and trailer, which Luc claims can haul a certain weight. He knows nothing about the capability of the truck, but it is not as he asserts. Mel buys the truck. On learning the truth, Mel confronts Luc, who says he was not trying to fool Mel—he was only trying to make a sale. This is a. a valid defense to a charge of fraud. b. fraudulent misrepresentation. c. a mistake of value. d. puffery.

fraudulent misrepresentation

Orin, an employee of Plumbing LLC, makes a substantial mathematical mistake in totaling the estimated costs for a project for which Quality Built Inc. is seeking bids. Consequently, Plumbing's bid is significantly low. Any contract with Quality Built that includes the mistake may be rescinded a. under no circumstances. b. if Quality Built knew or should have known of the mistake. c. if Plumbing knew or should have known of the mistake. d. if Orin's supervisor did not know of the mistake.

if Quality Built knew or should have known of the mistake.

Ray, an employee of Shipping Company, makes a substantial mathematical mistake in totaling estimated transportation costs for Tonnage Inc., which is seeking bids. Consequently, Shipping's bid is substantially low. Any contract with Tonnage that includes the mistake may be rescinded a. if the mistake was unilateral. b. if the mistake was made inadvertently and without gross negligence. c. under no circumstances. d. if the mistake was intentional

if the mistake was made inadvertently and without gross negligence

A covenant not to compete a.protects the public from unauthorized practitioners of certain professions. b.protects the public against actions that threaten the general welfare. c.is a promise to refrain from competing in business with another. d.is usurious.

is a promise to refrain from competing in business with another.

Restaurant Food Inc. intends to sell a certain quantity of beef for $1,100. In e-mail, however, the firm's sales representative mistakenly offers to sell the beef to Steak House for $1,000, Steak's manager immediately accepts. The seller a. is bound to the deal but can charge the intended price. b. can rescind the deal and recover damages for the mistake. c. is bound to the deal at the offered price. d. can rescind the deal.

is bound to the deal at the offered price

Carlos and David contract for the sale of five hundred head of Carlos's cattle for $195 per head. Unknown to either party, an unforeseen storm has struck the herd and many of the cattle have died. David is a. entitled to recover the value of the lost cattle. b. required to pay because he assumed the risk the cattle might die. c. not required to pay due to the bilateral mistake. d. not required to pay due to the unilateral mistake

not required to pay due to the bilateral mistake

Open Range agrees to sell Pinewood Ranch a remote parcel of land for $15,000. Both parties believe the land to be worthless, but beneath it is shale rock containing oil. A court would a. not rescind the contract. b. rescind the contract on the basis of a mistake of quality. c. rescind the contract on the basis of a mistake of opinion. d. rescind the contract on the basis of a mistake of value

not rescind the contract.

Dana believes that a new phone to be sold by Ear Fruit Inc. will become the most popular phone in the market. Dana enters into a contract to buy 500 shares of Ear Fruit stock, anticipating an increase in its value. The phone does not become popular, and the price of the stock does not rise. Dana can recover a. the amount of the purchase price. b. the amount of the purchase price plus the unexpected decrease. c. nothing. d. the amount of the purchase price plus the expected increase.

nothing

Dyan enters into a contract with Eli, who claims to have access to a stock-trading algorithm that will multiply an investment many times over. When the results do not match this claim, Dyan learns that Eli does not have access to the algorithm and files a suit, alleging fraud. Dyan must show harm to a. undo Eli's influence. b. punish the defendant. c. rescind the contract. d. recover damages

recover damages

In selling a vacant building, Riley, a real estate broker, tells Saki that the property has a certain capacity, making it suitable for a nightclub. Riley knows nothing about the capacity of the building, but it is not as he specifies. Saki buys the building. Saki's best course of action is most likely to a. scam Riley. b. sabotage Riley's career with bad publicity. c. induce Riley to remit to Saki the commission on Riley's next sale. d. recover damages or rescind the contract to buy the building

recover damages or rescind the contract to buy the building

Rosa signs a covenant not to compete with her employer, Sales Corporation. A court decides that the covenant is unreasonably restrictive. Most likely, the court will a.enforce it. b.reform it to prevent any undue burden. c.refuse to enforce it unless the employer pays additional consideration. d.evaluate its effect over time.

reform it to prevent any undue burden.

Ned threatens physical harm to force Omar to pay for "protecting" Omar's restaurant, Pasta Plates, from vandalism. Most likely, Omar may a. recover from the local police for their failure to protect his restaurant. b. do nothing once he has agreed to pay. c. recover from his insurer for the cost. d. rescind the contract or refuse to comply with its terms.

rescind the contract or refuse to comply with its terms.

At an auction, Ben bids on a 1957 Chevy coupe, believing that it is worth more than the price asked. When the car proves to need more repairs than Ben estimated, and thus is worth less as is, Ben is a. not liable on the bid because the need for repair is not a material fact. b. still liable on the bid. c. not liable on the bid because he underestimated the cost of repairs. d. not liable on the bid because the auctioneer misrepresented the value

still liable on the bid

Ked, a real estate agent, assures Lida that a certain parcel of commercial property fronts on the most highly trafficked street in Metro City. Lida buys the property and then discovers that the street has no more traffic than any other in its vicinity. Lida may recover damages for a. the city's undue influence. b. none of the choices. c. the buyer's mistake. d. the agent's fraudulent misrepresentation.

the agent's fraudulent misrepresentation

In entering into a contract with Marc for the sale of a cold storage warehouse, Nan fails to reveal the fact that the freezers do not consistently maintain a proper temperature. Most likely, this is fraudulent misrepresentation if a. Nan is not aware of the fact. b. the fact is a serious defect known to Nan but not to Marc. c. the fact concerns the value or quality of the freezers. d. any of the choices.

the fact is a serious defect known to Nan but not to Marc

Big Dig LLC makes an offer to perform an excavation and related tasks for Commercial Development Corporation, but due to a substantial mathematical mistake, significantly underprices the work. Commercial accepts the offer. Data Big's best defense against enforcement of the contract is that Commercial knew a. a mistake of value supports the cancellation of a contract. b. a unilateral mistake supports the cancellation of a contract. c. the price was below the prices of comparable services. d. a bilateral mistake supports the cancellation of a contract.

the price was below the prices of comparable services.

Ewa is induced by her guardian Filo to sign a contract to invest funds in Gold Inc. through Filo's investment firm. Unknown to Ewa, Filo realizes a commission from the investment. Most likely, Ewa can rescind the contract on the basis of a. fraud. b. undue influence. c. mistake. d. duress.

undue influence.