Contracts MBE session 3 (34)

Question 6124 An owner of a nail salon started a new promotion to boost sales. The owner claimed that she would pay $100 to any customer who purchased a new type of long-lasting manicure from her nail salon over the next four months if the customer's manicure did not stay intact for an entire month. A customer purchased a manicure during the promotional period per the terms set forth by the owner, but the customer's manicure only stayed intact for three weeks. The customer tried to collect the $100 from the owner, but the owner refused to pay the customer. Can the customer collect the $100?

No, because the customer did not notify the owner that she was accepting the offer prior to purchasing the manicure. No, because there was no bargained-for exchange. Yes, because this was an enforceable bilateral contract. Yes, because the customer accepted the offer by purchasing the long-lasting manicure during the promotional period. D

Question 7033 A construction company contracted with a manufacturer to purchase 100 identical prefabricated windows to use while constructing houses in a gated community. The windows were to be delivered in shipments of 25 windows each on April 1, May 15, July 1, and August 15. The written contract, signed by both parties, was silent as to when payment for each shipment would be due. The manufacturer made the first two shipments in conformity with the contract requirements, and the construction company paid one-fourth of the full contract price upon each delivery. However, on June 1, the manufacturer demanded that the construction company pay the entire remainder of the contract price before the manufacturer would make any further shipments. Which of the following statements is true?

The construction company has no duty under the contract to make any payments until the final delivery is made. The construction company must pay the manufacturer one-fourth of the contract price upon delivery of each conforming shipment of windows. The construction company's failure to pay the requested sum will amount to a repudiation of the contract. The manufacturer waived his right to demand immediate payment of the full contract price when he accepted the first payment of one-fourth the contract price on April 1. B

Question 6144 A company leased office space in a downtown building and subsequently entered into a written contract with a supplier to purchase furniture for the office. Among the provisions in the contract was the following: "This document contains the entire and final agreement of the parties. It supersedes any prior agreements, understandings, or negotiations, whether written or oral." A dispute subsequently arose over the tables and desks delivered by the supplier. The contract called for "cherry tables and desks" of designated designs. The company contended that the word "cherry" indicated the type of wood that the tables and desks were made of. The supplier, having delivered tables and desks made of a less expensive wood and finished with a cherry veneer, asserted that the use of the word "cherry" referred to the appearance of these items and did not require that the furniture be made solely of cherry wood. In the litigation of this dispute, the company sought to introduce a statement made by the supplier during negotiations that the tables and desks were of "solid-wood construction." In determining whether the contract was a total integration of the agreement between the company and the supplier, which of the following rules should the court apply?

The four-corners rule The "naturally omitted" rule The "certainly included" rule The plain-meaning rule C

Question 4286 At the beginning of the week, a homeowner met with a contractor regarding remodeling a bathroom in her home. At the conclusion of their meeting, the contractor told the homeowner that he would charge her $5,000-$6,000 for the work, but that he would get back to her with a final price. When he arrived at his office later that day, the contractor opened an email from the homeowner that she had sent earlier. In the email, she stated that she would pay the contractor $5,000 for the job. The next day, the contractor responded by email that he could not complete the work for less than $5,500. The homeowner replied by email that she couldn't pay $5,500, but that, if the contractor changed his mind, he could begin work before the end of the week. The contractor received the email, but did not respond. The contractor appeared the next day at the homeowner's house ready to remodel the bathroom. Which of the following statements regarding the relationship between the parties is most accurate?

A contract was formed at the price of $5,000. A contract was formed at the price of $5,500. A contract was formed at a reasonable price. No contract was formed. A

Question 6381 A man was moving to another state and decided that he wanted to give away some of his belongings. He knew his brother had always expressed interest in an antique desk. The man called his brother and said, "I'm going to be moving in two weeks. I would like to give you the antique desk as a gift. I'll drop if off at your house on my way out of town." The brother told the man that he was very grateful for the gift and was looking forward to having the desk in his home office. The brother immediately disposed of his old desk and made room for the antique one. A couple of days later, an appraiser, who was a friend of the man, visited the man's house for dinner. While at his house, he saw the antique desk and informed the man that it was worth well over $20,000. The man decided to keep the desk and did not drop it off at the brother's house on his way out of town. The brother brought suit against the man to recover the antique desk. If the court finds in favor of the man on these facts, what is the most likely reason?

A promise to make a gift in the future cannot be enforced. The brother did not rely to his detriment on the man's promise. The man's promise was not in writing. The man's refusal to give the piece of furniture did not cause injustice. D

Question 5985 At the auction of construction equipment owned by a contractor, several lots were offered for bidding and the highest bids for each were accepted by the auctioneer. The auctioneer then announced that a lot that consisted of a backhoe was being auctioned off. Several bids for the backhoe were acknowledged by the auctioneer. Just before the auctioneer brought down her gavel, she glanced at the contractor. The contractor gave the auctioneer a prearranged signal. Acting in accord with the signal, the auctioneer stated that the backhoe was being removed from the auction. There had been no indication as to whether the auction was being held with or without reserve. The highest bidder on the backhoe, contending that he is now its owner, has brought suit against the contractor. How should the court rule?

For the contractor, because the auctioneer had not brought down the gavel, announcing the completion of the sale of the backhoe. For the contractor, because the backhoe constituted equipment. For the highest bidder, because unless the seller reserves the right to withdraw an item from an auction, the seller may not do so once the auction has begun. For the highest bidder, because the seller forfeited his right to withdraw the backhoe by prearranging a signal with the auctioneer. A

Question 4355 A recent college graduate offered to buy all of the computers from a struggling online retailer for which he had been an intern during college. The terms of the written agreement were such that the graduate would pay $10,000 for a "reasonable number of computers, as the closing retailer no longer needed them." Due to the graduate's internship with the retailer, he knew that there were 50 computers in the office and knew that nearly all of them were unused, so he believed he would receive all 50 computers once the retailer closed. He gave the retailer a check for $10,000 and in return, took ten computers from the office that day. With the help of the $10,000 and a sudden upswing in sales in the online retail market, the retailer became profitable. When the graduate demanded the remaining 40 computers, the retailer refused. Instead, the retailer returned the $10,000 to the graduate and demanded the return of the ten computers in the graduate's possession. The graduate sued the retailer for breach of contract. The retailer moved to dismiss and argued that no valid contract existed. How should the court rule?

Grant the motion, because there was no agreement as to quantity. Grant the motion, because the retailer's increased profitability constituted a supervening event. Deny the motion, because the court may supply missing terms in a contract. Deny the motion, because the parties both had the objective intent to form a contract. A

Question 4280 A woman emailed her friend, stating that she would like to buy the friend's teacup collection when "times aren't so tough. I would pay $1,000 for them." The friend responded with an email agreeing to the deal. The women did not exchange money or the teacups and did not see each other until a year later. When they did see each other, the friend apologized for forgetting about their discussion and told the woman she would deliver the teacups the next weekend and would accept a check at that time. The woman said she did not remember the discussion but would pay $750 for the teacups. The friend responded, "Haven't we already discussed this? Sold." The next day, the friend turned the teacups over to the woman, who provided her with a check for $750. The friend immediately responded that she needed the check for the remaining $250. The woman kept the teacups. Is the woman liable for the remaining $250?

No, because a contract had not been formed. No, because a contract was not formed until the day the women spoke in person. Yes, because the original contract was for $1,000. Yes, because she kept the teacups. B

Question 6376 A math tutor entered into an agreement with a father to provide one month of tutoring for the father's son. The agreement stated that the math tutor would provide lessons for the son twice a week during the month for eight lessons at a total cost of $1,000. The cost included the materials valued at $350 that the math tutor intended to purchase from a particular educational services provider. The father knew a salesman for the educational services provider and notified him that his company should expect a sale in the next week. As the educational services provider was a new company without many sales, the salesman was excited at the prospect. A week after the agreement between the math tutor and the father was executed, the math tutor informed the father that he would not tutor the son unless the father provided an additional $250. The father refused. The educational services provider subsequently brought an action against the math tutor for breach of the agreement between the math tutor and the father. Will the educational services provider prevail?

No, because it did not detrimentally rely on the agreement. No, because it was only an incidental beneficiary of the agreement. Yes, because the father informed its salesman of the agreement concerning its materials. Yes, because the provider sustained $350 in lost-profit damages as a result of the math tutor's breach. B

Question 6142 A comic-book collector entered into a written contract with a man who had just inherited a large collection of comic books. They agreed that the man would sell to the collector numerous rare comic books for $4,000. Before they signed the agreement, the collector e-mailed the man to ask if he would include a particularly rare issue of Batman in the sale. The man agreed by e-mail that he would. The contract contained a list of each comic book that was supposed to be part of the sale, but the list did not include the Batman issue. The contract also stated that it was "the complete and final agreement" between the man and the collector. When the collector received the comic books, he discovered that the shipment did not include the Batman comic book. He sued the man, stating that even though the written contract did not mention the particular Batman issue, the collector had relied on the promise of the issue when he signed the contract. At trial, the collector seeks to introduce the e-mail he sent to the man prior to the execution of the agreement that referenced the Batman comic book. Is the e-mail admissible?

No, because of the parol-evidence rule. No, because the Uniform Commercial Code does not apply to this transaction. Yes, because the agreement was only partially integrated. Yes, because the parol-evidence rule applies only to oral communications. A

Question 4289 A math major at a local college agreed to tutor a high school student who was having trouble in his math class. The tutor promised to meet with the student for five hours a week for the remaining 2 months of the term, and the student's mother agreed to pay the tutor $20 per hour. In addition, the parties agreed that, if the student received a B or better in his math class, the mother would pay the tutor a $500 bonus. The parties did not reduce their agreement to writing. The mother paid the tutor weekly for the tutoring. At the end of the term, the student received a B+ in his math class. The mother, not having the funds to pay the tutor's bonus, contacted the tutor and offered her a bike worth $300 in lieu of the bonus payment. The tutor accepted the bike. Is the tutor entitled to recover the remaining $200?

No, because the tutor accepted the bike instead of the bonus. No, because the tutor agreed to accept a lesser amount. Yes, because the modification was not in writing. Yes, because there was no dispute as to the amount owed. A

Question 6145 The owner of a high-rise building entered into a written contract with a company to maintain and service the elevators in the building. The written contract contained the following provision: "This contract is the entire and final agreement of the parties regarding the maintenance and servicing of the elevators in Building. It supersedes any prior agreements, understandings, or negotiations." On the starting date of the contract, the company discovered that the elevators were significantly older than the owner had orally represented to the company during the negotiations prior to the signing of the contract. The company refused to maintain and service the building's elevators unless the owner agreed to a sizeable increase in the monthly payments called for in the contract. The owner refused and found another entity to maintain and service the elevators at a cost below what the company wanted, but above the original contract price. The owner then sued the company for breach of contract, seeking the difference between the contract price and the amount paid to the entity that was currently providing elevator maintenance and service. At trial, the company sought to introduce evidence of the owner's oral statement as to the age of the elevators during contract negotiations. Should the court permit the introduction of this statement?

No, because of the parol-evidence rule. No, because the contract is governed by common law rather than the Uniform Commercial Code. Yes, because the statement was oral, not written. Yes, because the statement relates to a contract defense. D

Question 7018 A gardener and a carpenter contracted in writing for the carpenter to repair the gardener's four identical beehives for $500 each. The contract was signed by both parties and provided that the gardener would pay the carpenter $2,000 upon delivery of the fourth repaired beehive. The gardener immediately delivered all four beehives to the carpenter for repair. The carpenter repaired and delivered the first two beehives without any problems and without demanding payment. However, upon delivery of the third repaired beehive, the carpenter demanded a payment of $1,500. Is the gardener required to make the demanded payment at this time?

No, because she has no duty to pay the carpenter anything until the last beehive is repaired and delivered. No, because the course of performance between the parties has established that payment is not due upon the delivery of each repaired beehive. Yes, because the carpenter is entitled to the fair value conferred on the gardener. Yes, because the contract is divisible with respect to the repair and delivery of each beehive. A

Question 7026 On April 1, a buyer and a seller contracted in writing for the sale of an antique car for $20,000. The parties met on April 15, the scheduled date of the sale under the contract, and exchanged the car and a check. The check bore the following conspicuous notation: "This check is in full and final satisfaction of your payment under our April 1 contract." When the seller got to the bank to deposit the buyer's payment, the seller noticed the notation and also realized that the check was only for $15,000. Needing the money, the seller deposited the check anyway. The seller then sued the buyer for the $5,000 difference between the amount paid and the contract price. If the buyer's only defense is accord and satisfaction, is the buyer likely to succeed?

No, because the amount the buyer owed the seller was liquidated and undisputed. No, because there was no consideration provided by the buyer to modify the contract. Yes, because the notation on the check formed a substitute contract. Yes, because the seller cashed the check knowing it was in full and final satisfaction of the contract. A

Question 7028 The owner of a coffee shop saw the work of an eccentric local artist at an art show. The owner discovered that the artist operated a small interior decorating business and, wanting the artist's unique style reflected in her own business, hired the artist to decorate her coffee shop. A week before the artist was scheduled to decorate the coffee shop, the artist sold her decorating business to a young art school graduate and delegated all of her outstanding contracts to him. The graduate took over all financial and creative management of the business. If the coffee shop owner refuses to accept performance by the art school graduate, is the owner liable for breach of contract?

No, because the artist's duty under the contract involved her taste and skill. No, because the delegation created reasonable grounds for insecurity. Yes, because the art school graduate is completely capable of performing the contract. Yes, because the contract did not prohibit delegation of duty. A

Question 6336 A produce wholesaler sent a written offer to a farmer to purchase all of the corn produced by the farmer for a period of two years. Excited at the prospect of having a guaranteed sale for all of his corn, the farmer immediately communicated his acceptance to the wholesaler. The wholesaler and farmer entered into a written contract reflecting the basic terms set forth in the wholesaler's offer. Six months after the contract was executed, the wholesaler determined that, while the farmer's corn was returning a profit, the farmer's corn was not selling as well as corn that the wholesaler could acquire from other sources. Nevertheless, the wholesaler contacted the farmer and informed him that he would no longer purchase the farmer's corn and would be buying his corn from another source. If the farmer sues the wholesaler for breach of contract, is he likely to prevail?

No, because the contract did not contain a specific quantity term. No, because the wholesaler no longer needed the farmer's goods. Yes, because the farmer relied on the wholesaler's promise. Yes, because the wholesaler did not act in good faith. D

Question 6141 An employee signed an employment contract with a company to be a remote salesman. The contract provided the employee's yearly salary and a requirement that he work at least 30 hours per week, but it did not provide any guarantees about how or when a potential bonus would be paid or earned. The contract also required the employee to log his monthly sales figures online by the last business day of the month. After the employee worked remotely for the company for a few months, the company called the employee on March 15. Over the phone, a representative of the company explained that the company was establishing a new bonus program for employees who reached certain monthly sales goals. The representative explained that in addition to logging sales online, the employee must call the company's central office on the first Friday of each month before the end of business hours and report his sales figures for the previous month in order to receive a bonus. The employee worked diligently for the remainder of March to meet the required sales figures in order to receive a bonus, working approximately 40 hours per week. He logged his sales online at the end of March, as required by his contract. On the first Friday in April, the employee called the company to report his March sales figures. However, the company had disconnected its phone lines and did not receive the employee's call. The company subsequently refused to pay the employee a bonus for his work in March. Will the employee likely prevail in a breach-of-contract action against the company for his unpaid March bonus?

No, because the employee's performance of his preexisting legal duty to sell merchandise for the company will not qualify as consideration. No, because the employee failed to notify the company during his conversation on March 15 that he had accepted the offered bonus plan. Yes, because the company itself prevented the employee from satisfying the express condition of the March 15 offer. Yes, because there is no evidence that the March 15 oral agreement between the employee and the company was unenforceable. C

Question 6022 A party-planning company specialized in creating and selling nine different kits for themed parties. A store that sells party related items entered into a written agreement with the company. Under this agreement, the company was to deliver 500 kits to the buyer by November 1. The agreement stated that selections regarding the type of kit and the number of each were to be made by October 15, but did not specify who was to make the selections. Neither the store nor the company selected any assortment of the kits by October 15. On October 16, the company notified the store that due to its breach, the company would not be shipping the party kits. At that time, the company had a surplus of all of their merchandise and could have filled the store's order with any combination of themed kits. On October 17, after receiving the company's notification, the store informed the company of its selections, but the company refused to send the kits that the store selected. If the store sues the company for breach of contract on November 1, is the store likely to prevail?

No, because the failure in the agreement to specify the party responsible for making the selection of type and number of each kit renders the contract unenforceable due to the indefiniteness of its terms. No, because the company had no duty to perform since an assortment was not selected by October 15. Yes, because the company was required to make a reasonable selection of available merchandise to fill the order. Yes, because the store's two-day delay in making its selection did not have a material effect on the company's ability to perform the contract. D

Question 7151 A painter entered into a contract with a homeowner to paint the exterior of the homeowner's home over a weekend while the homeowner was on vacation. After the homeowner left on his vacation, the painter was offered a second job that paid slightly more during the same weekend. The painter delegated his duty under the first contract to a second painter in exchange for a $50 advance and a promise to split his profits from both jobs with the second painter. The second painter took the advance and agreed to paint the homeowner's home that weekend. The first painter worked on the second job that weekend and did not check on the homeowner's home. When the homeowner returned from vacation, he discovered that his home had not been painted at all. In addition, no one has been able to locate the second painter. Does the homeowner have a cause of action against the first painter?

No, because the homeowner has not exhausted his remedies against the second painter. No, because the second painter accepted consideration in exchange for his promise to paint the home. Yes, because the first painter was not released from his liability to the homeowner. Yes, because the homeowner is unable to recover from the missing second painter. C

Question 7022 A library contacted a local artist expressing an interest in purchasing a particular one of the artist's sculptures for display at the library. The library's agent and the artist executed a written contract signed by both parties providing that the library would purchase the sculpture for $1,000 due upon delivery of the sculpture to the library. Just before they signed the contract, the agent told the artist, "Plan on delivering the sculpture in 10 days, but please remember that the library's obligation to purchase the sculpture will be conditioned on the approval of the chairperson of the Artistic Patronage Council, as they will be providing the library with the funds for this sale." The chairperson of the Artistic Patronage Council orally approved the sale the next day. However, ten days after the contract was executed, the artist decided he did not want to sell the sculpture. If the library sues the artist for breach of contract, is the library likely to prevail?

No, because the library's agent made an illusory promise. No, because there was no mutuality of remedy when the contract was executed. Yes, because the agreement was supported by good consideration even though it was conditioned on an uncertain event. Yes, because the artist waived any lack of consideration by signing the contract. C

Question 6395 A law student attended law school on a full scholarship. At the end of the law student's second year, the law student lost her scholarship. In order to fund her third year, she borrowed $50,000 from her rich uncle. They executed a written agreement stating that the law student would repay the loan two years from May 15, the date of her law school graduation. On May 15, two years later, the law student did not pay her uncle back because she was unable to find a job as a lawyer. Instead, she was working as a server at a coffee shop. The uncle took no legal action. Four years later, the law student was still unable to pay the uncle back, but she did write him a letter, stating "I know I still owe you $50,000. I will repay you $50,000 if I get a law firm job." The statute of limitations for collecting debts in the jurisdiction is three years. Is the law student's promise contained in the letter to repay the loan enforceable?

No, because the promise to repay is not supported by consideration. No, because the repayment of the loan was contingent upon her getting a law firm job. Yes, because the uncle's foregoing of legal action constitutes consideration. Yes, because the promise was made after the statute of limitations had run. D

Question 6414 A jeweler who specialized in engagement rings assisted a man who was trying to pick out the perfect engagement ring. The man was inexperienced with the various cuts of diamonds and types of ring settings. Over the course of a few weeks, the jeweler and the man looked at all of the ring styles and discussed pricing based on the man's budget of $5,000. The man finally settled upon a square cut diamond with a prong setting that was priced at $5,500. The man initially offered the jeweler $4,500 for the ring. While the man and the jeweler were negotiating the price, the jeweler received a phone call regarding a family emergency. The jeweler told the man that he would email him an offer in the evening, and if they could "meet halfway," the jeweler would sell the ring to the man. The man agreed. That evening, both the jeweler and the man received emails from one another at the same time. The jeweler's email contained an offer to sell the ring for $5,000, and the man's email contained an offer to buy the ring for $5,000. Both emails (i) specified the same style of ring that the two parties had discussed earlier that day, (ii) required payment upon receipt of the ring in two weeks, and (iii) were signed with an electronic signature. Based upon their earlier discussions and the jeweler's email offer to sell the ring to him for $5,000, the man did not look for an engagement ring at any other jewelry store. When the man showed up two weeks later to pick up and pay for the ring, the jeweler denied that they had a binding contract and would not sell the ring. If the man sues the jeweler for breach of contract, will he likely succeed?

No, because the two emails do not qualify as a writing which is required for the sale of goods over $500 under the Statute of Frauds. No, because two emails received at the same time with the same information do not act as an offer and acceptance. Yes, because the man detrimentally relied upon the jeweler's offer to "meet halfway" and the email offer to sell the ring to him. Yes, because both parties conveyed an intent to contract with one another through prior negotiations and the simultaneous emails. D

Question 7019 The owner of a bed and breakfast hired an artist to paint nature-themed murals in each of the five bedrooms. The contract provided that payment was due upon the satisfactory completion of all five rooms. The owner told the artist that each mural should relate to the name of the bedroom, but otherwise gave the artist broad discretion in designing each mural. When the owner checked the artist's progress a few weeks later, she found that although the murals in the three completed rooms related to the theme of the rooms, the color choices clashed with the overall décor of the bed and breakfast. The owner told the artist that she would accept his performance on the first three rooms, but asked the artist to incorporate a different color palette in the remaining rooms. The artist, unwilling to compromise his artistic autonomy, refused to paint the remaining two rooms and immediately terminated the contract. What is the artist entitled to recover from the owner of the bed and breakfast?

Nothing, because the contract expressly provided that payment would be due upon the completion of all five rooms. Nothing, because the murals in the three completed rooms clash with the overall décor of the bed and breakfast. The artist's expenditures in painting the first three rooms, and the artist's anticipated profit for painting the last two rooms. The reasonable value of the artist's services in painting the first three rooms, less any damages the owner may suffer from the artist's failure to paint the last two rooms. D

Question 6374 A butcher and a seller entered into a written contract for the purchase and sale of a building to be used as a butchery. The closing was scheduled for June 1. On May 25, the seller was notified by the city that the building, which had previously been used as a butchery, had a number of significant city code violations. The seller immediately contracted with an electrician and others to correct the issues. Despite his best efforts, the seller realized the building would not be brought up to code until at least June 10. The seller promptly sent written notification of this issue to the butcher and informed him that he would be unable to take possession of the building until June 10. Based on his agreement with the seller, the butcher had declined to renew his lease at his current location and was forced to remove his equipment and inventory from his current location by the end of May. Between June 1 and June 10, to prevent spoilage of his inventory due to the delay, the butcher had to rent space to store his equipment and inventory. He moved his freezer to the rented space to store his meat at a cost of $200 per day, plus the cost of electricity to run the freezer. On June 10, the building was up to code. The butcher paid the seller the agreed-upon purchase price of $300,000 and took possession of the property. What damages, if any, may the butcher recover from the seller?

Nothing, because the seller acted in good faith. Nothing, because the contract did not contain a "time is of the essence" clause. $2,000, the rental cost he had to pay from June 1 to June 10. $2,000 plus the cost for electricity to run the freezer. C

Question 6132 At a local market, a buyer offered to purchase a large, framed mirror from an artist for $1,000. The artist stated that he wanted to wait to see how many people went through the market that day before he decided on whether he would accept the offer. The next morning, the buyer returned to the market only to learn that the mirror had been dropped and broken. Because the frame of the mirror was still in good condition, the buyer wrote a check for $500 and gave it to the artist without further remark. The artist loaded the frame into the buyer's vehicle and demanded the remaining $500 offered the day before. Is the buyer liable for the remaining $500?

Question 6132 At a local market, a buyer offered to purchase a large, framed mirror from an artist for $1,000. The artist stated that he wanted to wait to see how many people went through the market that day before he decided on whether he would accept the offer. The next morning, the buyer returned to the market only to learn that the mirror had been dropped and broken. Because the frame of the mirror was still in good condition, the buyer wrote a check for $500 and gave it to the artist without further remark. The artist loaded the frame into the buyer's vehicle and demanded the remaining $500 offered the day before. Is the buyer liable for the remaining $500? C

Question 4353 A homeowner entered into oral contracts with both a painter and a landscaper to perform services at his home. The landscaper was the first to begin the services, and shortly after he began to work, he realized that the type of soil in the homeowner's yard would cause the projected cost of the work to increase dramatically. After the homeowner realized how high the cost of the landscaping services were going to be, he called the painter to tell her that he could not go through with their contract at that time. The painter stated that she had already purchased paint and brushes for the job, as well as painted glass to create a small, artistic mosaic on a back corner of the house as a sort of signature expression she planned to begin using. She had also paid for a temporary city permit to park her utility van on the residential street where the homeowner lived. Which of the following would not be a possible liability for the homeowner?

The contract price minus the market cost of performance Cost of the paint and brushes Cost of the glass Cost of the permit C

Question 6339 A homeowner met with a number of general contractors regarding significant renovations on his home. After a couple of successful meetings with one particular contractor, the contractor sent a letter to the homeowner stating that the contractor would perform the renovation work for $10,000. The homeowner responded with a letter stating that he would "only pay $8,500 and not more." Upon receiving the homeowner's letter, the contractor immediately commenced preparations for the renovation work, including beginning to acquire the materials necessary to complete the renovation. One week after beginning work on the homeowner's home, the contractor realized the renovation would cost $1,600 more than he anticipated due to the homeowner's very particular aesthetic requirements. After being informed of the higher cost, the homeowner refused to pay the contractor any amount over $8,500. The contractor promptly discontinued working on the renovation. The homeowner subsequently brought a breach of contract action against the contractor, seeking damages. Which party will prevail?

The contractor, because the homeowner's offer could only be accepted by a return promise. The contractor, because the unexpected costs discharged his obligation to complete performance. The homeowner, because the homeowner's offer was effectively accepted by commencement of performance. The homeowner, because the unilateral contract between the parties is enforceable. C

Question 4284 At lunch with two co-workers, the owner of a bike offered to sell it to his manager for $100. His manager replied, "That ancient thing? I'll give you $50 for it." The owner's assistant then stated, "I'll buy it for $75." Immediately after the owner responded, "OK," the manager said, "Wait a minute. How old is it?" When the owner replied, "Two years old," the manager said, "OK, I'll buy it for $100." Which of the following statements is true?

The owner may sell the bike to his manager for $100. The owner must sell the bike to his manager for $100. The owner must sell the bike to his assistant for $75. The owner may accept his manager's offer of $50. C

Question 6133 Prior to her death, a celebrity commissioned an artist to paint a portrait of her. The celebrity hired this particular artist because he only painted using an old-fashioned and rarely used style that required two months of daily appointments during which the subject would sit for the painting over a few hours each day. The contract between the parties specified that this live-model method be used, and that the celebrity would deliver increasing payments throughout the process, with the first payment occurring after two weeks of painting. One week into the process, after the painting had begun, the celebrity died. Her family demanded that the artist continue with the painting, using photographs as a substitute for the daily sessions. Is the artist required to complete a painting of the celebrity?

Yes, because he can complete it by relying on pictures of the celebrity. Yes, because he had begun painting the celebrity. No, because the celebrity died after only one week. No, because no payment had yet occurred. C

Question 4350 A father hoping to build a new playground for his children had a friend whose hobby was woodworking. One day over lunch, the two men discussed an arrangement in which the woodworker would build and deliver a swing set to the father for $2,000 within two weeks. After lunch, the woodworker sent an email to the father restating what had been discussed. The father immediately responded in a signed email stating "We have a deal. But please deliver the set within one week instead." The woodworker did not respond but began working on the swing set that day. Eight days later, the father called the woodworker to ask why the swing set had not been delivered. The woodworker stated that he intended to deliver the swing set within the two-week period originally discussed. He began to work more quickly to complete the swing set sooner and delivered the swing set two days early, but the father refused to pay him for it. Under the UCC, is the woodworker entitled to recover the $2,000?

Yes, because he delivered the swing set within two weeks. Yes, because the goods were specially manufactured. No, because the parties did not agree to all essential terms. No, because the woodworker did not deliver the swing set within one week. A

Question 6126 A groom left his bride at the altar on the day of her wedding. The bride could not bear to keep any painful reminders of the occasion, so she offered to sell her wedding dress to one of her bridesmaids for $5,000. The bride stated that the offer would remain open for 30 days. The bridesmaid said she was interested but would have to think about it. A week later, the bridesmaid emailed the bride to ask if the price included a custom-made veil that the bride had worn. The bride did not respond to the bridesmaid's question. Within the 30-day period, the bridesmaid accepted the bride's initial offer of $5,000 for the wedding dress. In response, the bride stated that the bridesmaid could only buy the wedding dress for $6,000. Was a contract formed when the bridesmaid accepted the initial offer of $5,000?

Yes, because the bridesmaid's question did not constitute a counteroffer. Yes, because the bride was required to keep the initial offer open for the 30-day period. No, because the bridesmaid's question acted as a counteroffer and rejection of the $5,000 offering price. No, because the bride raised the price of the dress to $6,000. A

Question 4354 A car salesman at a car dealership called out with a megaphone, "Free set of wheels to the next person who buys a car from me!" He was surrounded by expensive high-end vehicles at the dealership, which specialized in that type of vehicle. A customer immediately approached the salesman and purchased a new vehicle for his son, believing that he would have a nice new car to give to his daughter as well. The salesman then walked to the dealership's garage and walked out with a shiny new bicycle. The customer responded that the salesman was contractually obligated to give him a car. The salesman laughed and said that he was never offering a free car, but would cancel the sale of the first car as a consolation. Is the salesman obligated to give the customer a free car?

Yes, because the customer reasonably believed the salesman was making a valid offer. Yes, because a reasonable person would have believed the salesman was offering a free car. No, because no reasonable person would believe that the salesman was offering a free car. No, because the salesman was willing to cancel the sale. C

Question 6135 A woman sent an offer to sell her office printer to her friend for $450. In her offer, the woman mentioned that an acceptance could be mailed to her business address, and that the friend should let her know within the next couple of weeks whether she was interested. The friend needed an office printer, so she immediately accepted the woman's offer by mailing a letter to the woman's home address. The woman only checked her mailbox at home once a week because she received so much junk mail, so she did not see the acceptance letter. Thinking that her friend was not interested, the woman sold her office printer to a different person. The next day, the friend came to the woman's house with a check for $450. The woman told the friend she had already sold the office printer. Will the friend succeed in an action for breach of contract?

Yes, because the offer was irrevocable for at least two weeks. Yes, because the woman did not specify that mailing an acceptance to her business address was the only mode of acceptance. No, because it was not reasonable for the friend to mail her acceptance to the woman at the woman's home address. No, because the woman did not see the friend's acceptance letter. B

Question 6137 The owner of a beauty products store mentioned to a long-time customer that she was selling her car. The storeowner showed the customer, who was a sales representative at a clothing store, a picture of the vehicle and told her its year, make, model, and mileage. When the customer expressed an interest, the storeowner gave her the keys and told her to check it out for herself. The customer took the keys, looked over the inside and the outside of the car, and drove it around the block. When the customer returned to the store, the storeowner honestly stated that she knew little about cars and was selling the car with all its faults. The customer indicated that she also knew little about cars. The storeowner and the customer agreed upon a price of several thousand dollars for the car. Several days after the customer paid for the car and took ownership of it, she learned that the car required a costly engine overhaul that neither the storeowner nor the customer was aware of at the time of the sale. The customer has filed a lawsuit against the storeowner for breach of the warranty of merchantability. Is the customer likely to be successful?

Yes, because the warranty of merchantability cannot be orally disclaimed. Yes, because the customer knew little about cars. No, because the storeowner was unaware of the problem with the car's engine. No, because the storeowner was not a merchant. D