BUL 3310 Units 6 Chapter 13 & 15

Which of the following statements expresses an illusory promise? "I will drive you to school in the morning if it is raining." "I will buy your boat and trailer for $5,000 if the engine runs okay." "I will buy you a new car if you make Dean's List three semesters in a row." "I will go to your violin recital on Saturday if there is nothing good on television."

"I will go to your violin recital on Saturday if there is nothing good on television."

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

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

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

Exemplary

$1 is never legally adequate consideration in a contract because no one will willingly incur a legal detriment for $1. True False

False

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

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

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

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.

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 winning party in a breach of contract case is normally entitled to attorney's fees, witness fees and filing costs. 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

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.

In an accord and satisfaction, the accord is... The old agreement The substitute agreement The performance of the action called for in the substitute agreement. The liquidated portion of a debt.

The substitute agreement

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.

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.

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

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

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 amount of damages sustained in a breach of contract case is a question of fact to be presented to the jury. 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

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

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

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

Bill Builder entered into a contract with Carl's Carpets to supply him with the carpeting he needed to complete the renovation of Famous Restaurant. When Carl did not deliver the carpeting on the contract date, Bill had to find similar carpeting from a different vendor for 5 a yard more than he would have paid to Carl. There was a time is of the essence clause in Bill's contract with Famous Restaurant. Bill was to lose 300day for each day after the contract date that he was late in finishing the renovation. The 300 day represented the profit Famous Restaurant would lose each day it was not in operation. Bill told Carl about this clause, impressing on Carl the need for him to deliver the carpet on time. Bill finished the renovation three days after the contract date. The delay was due solely to Carl's failure to deliver the carpet on time. Bill can recover the 900 he lost from Carl as ___________ damages. Liquidated Punitive Consequential Nominal

Consequential

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.

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

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

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.

Which of the following statements is true about an accord and satisfaction? It is only used in construction contracts. It is only used in labor contracts It can only be used in liquidated debt contracts. It can be used for unliquidated debts based on contract or tort claims.

It can be used for unliquidated debts based on contract or tort claims.

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

Legal remedy

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

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

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

Special

If the seller of a parcel of real property breaches and refuses to sell, the best legal remedy for the buyer who wants this particular piece of property is.. Compensatory damages Consequential damages Specific performance Restitution

Specific performance

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

John bought a dishwasher from Local Appliance Store. What type of law governs the contract between John and Local? State common law Federal common law The Uniform Commercial Code The Sarbanes-Oxley Act

The Uniform Commercial Code

. 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

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

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

detrimental reliance

Legal remedy

is the recovery of money