Module 5 Quiz

Which of the following must a mutual mistake involve in order for a mutual mistake to interfere with legal consent?

A basic assumption about the subject matter of the contract, an adverse effect on a party who did not agree to bear the risk of mistake at the time of the agreement, and a material effect on the agreement. For a mutual mistake to interfere with legal consent, it must involve a basic assumption about the subject matter of the contract, a material effect on the agreement, and an adverse effect on a party that did not agree to bear the risk of mistake at the time of the agreement.

Which of the following represents a lack of genuine assent?

Acceptance secured through fraud, undue influence, duress, or misrepresentation. Sometimes the offeror secures the acceptance of the agreement through improper means, such as fraud, duress, undue influence, or misrepresentation and in these situations; there really is no genuine assent to the contract.

A false statement about a fact material to an agreement that the person making the statement believed to be true is considered _____.

An innocent misrepresentation is a false statement about a fact material to an agreement that the person who made the statement believed to be true.

Which of the following occurs when a party threatens to file a frivolous civil lawsuit unless another party gives consent to the terms of a contract?

Duress occurs when one party threatens to file a frivolous civil lawsuit unless another party gives consent to the terms of the contract.

Which of the following have all their terms clearly set forth in either written or spoken words?

Express contracts have all their terms clearly set forth in either written or spoken words.

An offer has two elements, intent and definite and certain terms.

False An offer has three elements: intent, definite and certain terms, and communication of the offeree.

States still require that formal contracts be under seal.

False States today do not require that contracts be under seal.

The mirror-image rule is applicable when a unilateral contract is involved.

False When a bilateral contract is being formed under the common law, the mirror-image rule applies to the acceptance.

When duress is at issue, the _____ needed for legal consent has been removed by the specifics of the threat.

Free Will With duress, the point is that the free will necessary for legal consent had been removed by the specifics of the threat.

What is the effect of a negligent misrepresentation?

The impact of negligent misrepresentation is identical to that of fraudulent misrepresentation.

Courts interpret contracts using an objective standard.

True Contracts are interpreted using an objective standard, meaning that the courts are concerned with only the party's outward manifestations of his or her intent, not what is going on in that party's mind.

Misrepresentation is a false statement by a party about a material fact.

True Misrepresentation is a false statement by a party about a material fact.

Silence may constitute acceptance of an offer.

True The Restatement of Contracts offers three circumstances under which silence can be an acceptance.

An error by one party about a material fact is known as a(n) _____ mistake.

Unilateral An error by one party about a material fact is known as a unilateral mistake.

Mistakes in contracts may be classified as _____.

Unilateral and mutual Mistakes in contracts may be classified as unilateral and mutual.

What are the elements of a binding contract?

agreement, consideration, contractual capacity, and legal object.

All contracts can be categorized as either _____ or _____ contracts.

bilateral or unilateral

A _____ is a false representation of a material fact that is consciously false and intended to mislead the other party.

fraudulent misrepresentation is a false representation of a material fact that is consciously false and is intended to mislead the other party.

In a _____ contract, the offeror wants a performance to form the contract.

unilateral contract, the offeror wants a performance to form the contract.

A _____ contract is one that contains all the legal elements of a contract.

valid contract is one that contains all the legal elements of a contract.