Chapter 16, 17, 18, and 20

The provision that the seller will release Maurice from any obligation if he lost his job is referred to as which of the following? A. A condition subsequent B. A condition precedent C. A bona fide condition D. A condition concurrent

A. A condition subsequent

Which of the following is used when, by agreement one of the parties substitutes a different performance for his or her original duty under the contract? A. Accord and satisfaction B. Novation C. Substituted contract D. Mutual rescission

A. Accord and satisfaction

In most states, which of the following are exceptions to when the statute of frauds would apply? A. Admissions, partial performance, and promissory estoppel B. Partial performance and admissions, but not promissory estoppel C. Promissory estoppel but not admissions or partial performance D. Promissory estoppel and partial performance, but not admissions

A. Admissions, partial performance, and promissory estoppel

22. Which of the following occurs when a party threatens to file a criminal lawsuit unless consent is given to the terms of a contract? A. Duress B. Undue influence C. Coercion D. Criminal influence

A. Duress

Which of the following is true regarding the effect of an innocent misrepresentation on a contract? A. It permits the party that was misled by the false statement to rescind the contract, but damages are not available. B. It permits the party who made the false statement to rescind the contract. C. It permits either the party that was misled by the false statement or the party who made the false statement to rescind the contract. D. The contract is automatically void and of no effect, and the party who was misled may recover damages.

A. It permits the party that was misled by the false statement to rescind the contract, but damages are not available.

A condition ______ is a particular event that must occur in order for a party's duty to arise. A. Precedent B. Subsequent C. Concurrent D. Certain

A. Precedent

Which of the following involves the legal enforcement of an otherwise unenforceable contract due to a party's detrimental reliance on the contract? A. Promissory estoppel B. Substantial estoppel C. Promissory rule D. Promissory reliance

A. Promissory estoppel

Which of the following is a term for contracts within the statute of frauds involving promises to pay a debt of another if the initial party fails to pay? A. Secondary obligations B. Primary promises C. Primary obligations D. Third-party debts

A. Secondary obligations

Which of the following is true regarding Wilma's statement to the judge that the agreement to sell the car was covered by the UCC? A. She was correct. B. She was incorrect because while the UCC has a provision regarding writings for the sale of certain goods, that provision is not a part of the statute of frauds. C. She was incorrect because the statute of frauds provision involving the sale of goods only applies to goods costing over $1,500. D. She was incorrect because the statute of frauds provision involving the sale of goods only applies to goods costing over $5,000.

A. She was correct.

Mary and Jason discuss the fact that a new teacher is being hired for business law at their school. Jason mentions that he does not yet have a book, and Mary agreed to sell Jason a used business law book for $30 for the upcoming semester. When the new semester begins, the new business law teacher announces that a new custom business law text will be used that is only available in the campus bookstore. Jason wants a refund. Which of the following is Mary's best defense? A. That Jason knew of change of teacher and bore the risk of mistake. B. That only a unilateral mistake was involved on Jason's behalf because Mary was aware of the change and that, therefore, Jason is not entitled to a discharge. C. That a mutual mistake was involved and that Jason is, therefore, not entitled to a refund. D. That she did not commit fraud and that, therefore, Jason is not entitled to rescission.

A. That Jason knew of the change of teacher and bore the risk of mistake

Which of the following parties must sign a document coming within the statute of frauds? A. The party against whom action is sought B. The offeror only C. The offeree only D. Any party to the contract

A. The party against whom action is

The provision that Maurice did not have to buy the house unless he was able to get a loan is referred to as which of the following? A. A condition subsequent B. A condition precedent C. A bona fide condition D. A condition concurrent

B. A condition precedent

Which of the following occurs when a contracting party refuses to complete the contract before the actual time of performance? A. Preemptive repudiation B. Anticipatory repudiation C. Advance refusal D. Advance repudiation

B. Anticipatory repudiation

Which of the following damages are designed to put the plaintiff in the position he or she would have been in had the contract been fully performed? A. Equitable B. Compensatory C. Public D. Nominal

B. Compensatory

The parties' discharge of their obligations by doing what they respectively agreed to do under the terms of the contract is called _________. A. Discharge by tender B. Discharge by performance C. Discharge by finishing D. Discharge by reason

B. Discharge by performance

A[n] ______ is a false representation of a material fact that is consciously false and intended to mislead the other party. A. Negligent misrepresentation B. Fraudulent misrepresentation C. Scienter misrepresentation D. Acknowledged misrepresentation

B. Fraudulent misrepresentation

A[n] ______ misrepresentation results from a false statement about a fact material to an agreement that the person making the statement believed to be true. A. Wrongful B. Innocent C. False D. Misleading

B. Innocent

Which of the following are written contracts intended to be the complete and final representation of the parties' agreement? A. Complete contracts B. Integrated contracts C. Adhesion contracts D. Bilateral contracts

B. Integrated contracts

A[n] ______ mistake is a mistake that is shared by both parties to an agreement. A. Unclear B. Mutual C. Unilateral D. Clear

B. Mutual

Which of the following is false regarding the statute of frauds and promises made in consideration of marriage? A. Agreements regarding marriage in which one party is gaining something other than a return on his or her promise to marry are within the statute of frauds and must be in writing. B. Mutual promises to marry fall within the statute of frauds. C. Prenuptial agreements fall within the statute of frauds. D. A prenuptial agreement is not automatically enforceable just because it is in writing.

B. Mutual promises to marry fall within the statute of frauds

Which of the following refers to an intentional failure to provide pertinent information about a projected contract? A. Concealment B. Nondisclosure C. Negligence D. Scienter

B. Nondisclosure

Which of the following occurs when the parties to the agreement wish to replace one of the parties with a third party? A. Accord and satisfaction B. Novation C. Substituted contract D. Mutual rescission

B. Novation

As discussed in the text, a main purpose of the statute of frauds is to prevent unreliable _____ evidence from interfering with a contractual relationship. A. Hearsay B. Oral C. Irrelevant D. Immaterial

B. Oral

Under _________, if the buyer in an alleged contract for the sale of land has paid any portion of the sale price, has begun to permanently improve the land, or has taken possession of the land, the courts will consider this as proof of the contract and negate the need for a writing? A. Substantial performance B. Partial performance C. Sales substantiation D. The purchase proof rule

B. Partial performance

When a contract is voidable, it may be ______. A. Chargeable B. Rescinded C. Destroyed D. Uncharged

B. Rescinded

Which of the following requires that the breaching party fulfill the terms of the agreement? A. Specific obligation B. Specific performance C. Absolute obligation D. Absolute performance

B. Specific performance

Which of the following is true regarding Wilma's statement to the judge under oath that she orally agreed to sell the house? A. The statement has no effect because of the statute of frauds. B. The statement would be classified as an admission and would establish an exception to the statute of frauds involving the agreement on the house. C. The judge would be estopped from considering the evidence. D. The statement would be excluded from consideration because of the collateral interest rule.

B. The statement would be classified as an admission and would establish an exception to the statute of frauds involving the agreement on the house.

Which of the following refers to special relationships in which one person has taken advantage of his or her dominant position in a relationship to unduly persuade the other person? A. Fraudulent misrepresentation B. Undue influence C. Pressing dominance D. Relationship dominance

B. Undue influence

Sally has a large farm and significant other assets. She agreed to loan her nephew Todd $100,000 with payments of principle and interest to be made yearly. A few years later she and Todd got into a dispute and Sally sued Todd for not paying interest. Todd defended on the basis that two years after the initial loan agreement was entered into, he and Sally entered into an oral agreement that he would perform services on her farm in lieu of paying interest on the note. Which of the following is the most likely result of the dispute? A. Todd will be required to pay the interest amounts because the agreement involving performing services in lieu of paying interest was not in writing. B. Todd will be required to pay the interest amounts because the parol evidence rule bars evidence of any oral agreement outside the written agreement. C. Assuming the court credits Todd's account of events, Todd will not be required to pay the interest amounts because the oral agreement will be considered a separate enforceable agreement. D. Assuming the court credits Todd's account of events, Todd will not be required to pay the interest amounts because the oral agreement will be considered an extension and part of the original written agreement.

C. Assuming the court credits Todd's account of events, Todd will not be required to pay the interest amounts because the oral agreement will be considered a separate enforceable agreement.

A _______ occurs whenever a party fails to perform his or her obligations under the contract. A. Split B. Break C. Breach D. Mistake

C. Breach

Which of the following is a type of contract that does not fall within the scope of the statute of frauds? A. Contracts related to an interest in land B. Promises made in consideration of marriage C. Contracts related to any lease of equipment D. Contracts whose terms prevent possible performance within one year

C. Contracts related to any lease of equipment

Which of the following is true regarding Wally getting a loan and putting a new roof on the house? A. Wally should have known better, and his actions would be of no use to him in attempting to enforce the contract. B. The judge would consider his actions under the UCC as exceptions to the parol evidence rule. C. His actions would likely amount to promissory estoppel, which establishes an exception to the statute of frauds. D. His actions would be considered only because Wilma told the judge that she had orally agreed to the contract.

C. His actions would likely amount to promissory estoppel, which establishes an exception to the statute of frauds.

Which of the following involves a promise to buy or sell that the courts will require the parties to obey? A. Bilateral assent B. Legal affirmance C. Legal assent D. Contractual affirmance

C. Legal assent

Under which of the following type of damages do the parties specify in advance the damages if there is a particular kind of breach? A. Consequential B. Punitive C. Liquidated D. Nominal

C. Liquidated

A[n] ______ agreement is a clause parties include in a written agreement that states that the written agreement accurately reflects the final, complete version of the agreement. A. Adhesion B. Parol C. Merger D. Consolidation

C. Merger

If a contract does not clearly specify that the satisfaction is to be personal, the ________ standard applies. A. Express B. Subjective C. Objective D. Absolute

C. Objective

The ______ rule is a common law rule that addresses the admissibility of oral evidence as it relates to written contracts. A. Oral admissibility B. Oral evidence C. Parol evidence D. Frauds evidence

C. Parol evidence

A[n] ______ agreement is an agreement two parties enter into before marriage that clearly states the ownership rights each party enjoys in the other party's property. A. Preliminary B. Planned C. Prenuptial D. Arranged

C. Prenuptial

An offer of performance by being ready, willing, and able to perform is known as _________________. A. Offering B. Showing C. Tender D. Implied acceptance

C. Tender

Which of the following was the result on appeal in the Case Opener involving the claim that Michael Jordan owed $5 million based on his agreement to pay the plaintiff's mother on the premise that he was the father although it was later determined that the child was not his? A. That the agreement to pay $5 million could be rescinded based on a mutual mistake of fact. B. That the agreement to pay $5 million could be rescinded based on the mother's fraud. C. That the agreement to pay $5 million could be rescinded based on either a mutual mistake of fact or based on the mother's fraud. D. That the agreement to pay $5 million could not be rescinded because Jordan was aware of a question about his parentage.

C. That the agreement to pay $5 million could be rescinded based on either a mutual mistake of fact or based on the mother's fraud.

Which of the following is needed in order to satisfy the UCC's requirement for a written document? A. The contract or memorandum needs only to state the price of the goods. B. The contract or memorandum needs only to state the quality of the goods. C. The contract or memorandum needs only to state the quantity to be sold. D. The contract or memorandum needs to state the price of the goods, the quality of the goods, and the quantity to be sold.

C. The contract or memorandum needs only to state the quantity to be sold

Which of the following is an exception as to when a secondary obligation needs to be in writing? A. The primary-purpose rule B. The resulting-fact rule C. The main-purpose rule D. The personal-obligation standard

C. The main-purpose rule

Which of the following is true regarding types of conditions? A. There is only one type of condition: precedent. B. There are two types of conditions: precedent and subsequent. C. There are three types of conditions: precedent, subsequent, and concurrent. D. There are four types of conditions: precedent, subsequent, concurrent, and timeliness.

C. There are three types of conditions: precedent, subsequent, and concurrent.

A[n] ______ mistake is the result of an error by one party about a material fact. A. Unclear B. Mutual C. Unilateral D. Clear

C. Unilateral

Although there are some exceptions, a[n] ______ mistake does not generally void a contract. A. Unclear B. Mutual C. Unilateral D. Clear

C. Unilateral

The most frequently awarded damages are ________________ damages.

Compensatory

Within the statute of frauds, "land" encompasses not only the land and soil itself but anything ______ to the land. A. Relating B. Adjacent C. Pertinent D. Attached

D. Attached

Which of the following is true regarding ways by which a party's contractual obligations may be discharged? A. Performance is the only way a party's contractual obligations may be discharged. B. The failure of a condition to occur and performance are the only ways a party's contractual obligations may be discharged. C. Operation of law is the only way a party's contractual obligations may be discharged. D. Discharge may occur through material breach by one or both parties.

D. Discharge may occur through material breach by one or both parties.

When a party's obligations under a contract are terminated, the party is said to be ____________. A. Finished B. Terminated C. Completed D. Discharged

D. Discharged

The obligation to use reasonable efforts to minimize damage resulting from a breach is referred as the duty to _________ one's damages. A. Reduce B. Remit C. Reform D. Mitigate

D. Mitigate

A contractual condition of satisfaction may be judged by either a[n] ________ or ________ standard. A. Objective; express B. Subjective; express C. Objective; absolute D. Objective; subjective

D. Objective; subjective

Which of the following is true regarding the elements that must be satisfied in order for a mutual mistake to interfere with legal consent? A. The required elements are: (1) a basic assumption about the subject matter of the contract, and (2) an admission by one of the parties that a misrepresentation occurred. B. The required elements are: (1) a basic assumption about the subject matter of the contract, and (2) a material effect on the agreement. C. The required elements are: (1) a basic assumption about the subject matter of the contract, and (2) an adverse effect on a party who did not agree to bear the risk of mistake at the time of the agreement. D. The required elements are: (1) a basic assumption about the subject matter of the contract, (2) an adverse effect on a party who did not agree to bear the risk of mistake at the time of the agreement, and (3) a material effect on the agreement.

D. The required elements are: (1) a basic assumption about the subject matter of the contract, (2) an adverse effect on a party who did not agree to bear the risk of mistake at the time of the agreement, and (3) a material effect on the agreement.

George offers to sell Penelope a ring that George found in his yard. He and Penelope look at the ring and decide that they are not sure what it is, probably just a shiny stone. Penelope pays George $10 for the ring. The ring turns out to be a diamond worth much more than $10. George wants the ring back, and Penelope refuses. What is the most likely result? A. The ring will be returned to George because of mutual mistake. B. The ring will be returned to George because of unilateral mistake. C. The ring will remain with Penelope unless George can establish that he was negligent in not recognizing the ring's true value. D. The ring will remain with Penelope because the parties contracted on the assumption that they did not know the value of the ring.

D. The ring will remain with Penelope because the parties contracted on the assumption that they did not know the value of the ring.

Which of the following occurs when one of the parties to a contract has so much more bargaining power than the other that he or she dictates the terms of the agreement? A. Unfairness B. Cohesiveness C. Disconnection D. Unconscionability

D. Unconscionability

Without legal assent a contract may be ____. A. Unmarketable B. Void C. Illegal D. Voidable

D. Voidable

________________ is when one party threatens another party with physical harm or extortion to gain consent to a contract.

Duress

Contractual conditions may be expressly inserted into the contract by the parties but may not be implied by law. True False

False

In order for the statute of frauds to be satisfied, all parties to a contract must sign the writing. True False

False

The Uniform Electronic Transactions Act reflects the decision that electronic transactions do not constitute a written copy because the electronic transaction is not technically a written document. True False

False

The purpose of the parol evidence rule is to prevent attempts to use only oral evidence to prove agreements. True False

False

A mistake of fact is an erroneous belief about the facts of the contract at the time the contract is made. True False

True

A negligent misrepresentation results when the party making the statement would have known the truth about the fact had he used reasonable care to discover or reveal it. True False

True

Contracts related to an interest in land fall within the statute of frauds. True False

True

For fraudulent misrepresentation to be the basis for a contract rescission, the statement of fact need not be an actual assertion. True False

True

If a contract's terms require that modification be in writing, oral modifications are inadmissible and unenforceable. True False

True

Restitution is the return of any property given up under the contract. True False

True

Scienter is present when the party accused of making the fraudulent assertion believed that the assertion was false or made the claim without any regard for whether it was true or false. True False

True

Under ordinary circumstances, a party's duty to perform a promise agreed to in a contract is absolute. True False

True

Undue influence refers to those special relationships in which one person has taken advantage of his or her dominant position in a relationship to unduly persuade the other person and interfere with that person's ability to make his or her own decision. True False

True

When an enforceable contract does not exist, the court may grant a recovery based on quasi-contract in order to prevent an injustice from occurring. True False

True

The responsibility of Maurice to make arrangements to give the window installer access to the home is referred to as which of the following? A. A condition subsequent B. A condition precedent C. An implied condition D. An express condition

[C. An implied condition

Under the Uniform Commercial Code, contracts for the sale of __________ totaling more than $500 must be in writing.

goods