Law and Society Midterm #2

which of the following statements is true of discharge of contracts?

tender of performance discharges a party's contractual obligation

The state of Transas has set a maximum interest rate of percent on loans. Matt borrow $10,000 from Tony to pay off a gambling debt. Both are residents of Transas. They sign a contract, which states that Matt would have to pay $1,500 as interest in one year to pay off the loan. Later Matt gets to know about the state usury limit and sues tony. What is the nature of the contract between Matt and Tony?

the contract is void as it violates usury law

Which of the following statements is true of an offer that was not communicated?

the offer cannot be accepted by the offeree if not communicated

Which of the following terms refers to an unconditional and absolute offer by a contracting party to perform his or her obligations under a contract?

Tender of Performance

Which of the following is true of a contract with an adjudged insane person?

The contract is void

Under which of the following conditions is a contract said to have legal value?

The promisor receives a legal benefit

________ is a clause in a contract in which parties specify certain events that will excuse nonperformance

Force Majeure

Which of the following statements is true of contracts?

To have an enforceable contract, there must be mutual assent by the parties

Which of the following is true of a gift promise?

A completed gift promise cannot be cancelled for lack of consideration

which of the following does the one-year rule state?

A contract cannot be performed on its own terms within a year should be in writing

What is the key difference between an agreement and a contract?

A contract is always enforceable in the court of law, while an acceptance may or may not be

which of the following is true of undue influence in entering contracts?

A fiduciary or confidential relationship must have existed between the parties for undue influence to be proven

Which of the following would be considered an offer to form a unilateral contract?

A reward offer

James had a contract with Frasier to fix Frasier's plumbing issue at his home. The contract was made for $3,000. But after the work was completed, Frasier refused to pay anything unless James agreed to accept $2,500. In the above scenario, to avoid legal nuisance, Frasier decides to compromise with James. He asks James to fix a tap in the barn for $250, and modify the current contract to include the tap in the barn. James agrees to this, and does as asked while Frasier remakes the contract. Which of the following would this kind of settlement be referred to as?

Accord

A legal right that arises out of a breach of contract is ________

Assignable

A (n) ________ occurs when there is a transfer of both rights and duties under a contract.

Assignment and Delegation

In which of the following conditions is a party's absolute duty to perform conditioned on the other party's absolute duty to perform?

Concurrent Condition-simultaneous

Preprinted forms whose terms the consumer cannot negotiate, and must sign in order to obtain a product or service are referred to as ______

Contracts of adhesion

Which of the following is an exception to the Statute of Frauds?

Contracts under promissory estoppel

Gary and Mary are siblings involved in a legal tangle over who gets possession of their ancestral home. Gary threatens to kill Mary's husband if she does not sign papers declaring Gary's sole ownership of their home. This is an instance of ________.

Duress

_______ is a rule that states that a minor is obligated only to return the goods or property he or she has received from an adult in the condition it is in at the time of disaffirmance

Duty of Restoration

The ________ says that agents' contracts to sell property covered by the Statue of Frauds must be in writing to be enforceable

Equal Dignity Rule

Which of the following is true of the equity doctrine?

Equity is resorted to when an award of money damages would not be the proper remedy

A contract that has been fully performed on both sides is called a (n) ______ contract.

Executed

Luke offered to sell his farm to Kent at $75,000 an offer which Kent declined. A week later, Luke offered to sell the farm for $65,000, stating it was the final offer that would be valid for one month only. Two days later, Kent offered to pay $60,000 for the farm. Luke received Kent's offer a week later and declined it. After ten days, Kent agreed to buy the farm for $65,000, but Luke refused to sell the farm. Kent decided to sue Luke for breach of contract. The judge ruled in favor of Luke. Which of the following is a reason for the ruling in Luke's favor?

Kent's counteroffer of $60,000 had rendered the offer for $65,000 invalid.

Which of the following constitutes a mutual mistake of a material fact?

Martha and Graham agreeing on the sale of a house, both referring to different houses.

Which of the following statements is true of the Statute of Frauds?

Most states require contracts to pay compensation for services rendered in negotiating the purchase of a business to be in writing.

In which of the following cases of assent is the rescission of a contract unenforceable?

Mutual Mistake of Value

The party to whom a duty is owed is the ______

Obligee

Corey in a desperate need to get to the airport decides to take his neighbor Tanner's help. Tanner agrees to help and drives Corey to the airport. Cory promises to pay Tanner $25 for the gas filled. Corey's promise falls under which of the following contracts?

Past Consideration

Stella gets injured in a motor accident and is brought to the hospital by a passerby. Stella subsequently passes into a coma. The doctors and other staff perform the necessary medical procedures to save her life. Stella comes out of her coma two months later and is released from the hospital after the doctors are satisfied by her recovery. Under the doctrine of ____ contract, Stella has to pay the hospital for its services.

Quasi-Contract

_________ is a licensing statute with the primary purpose of increasing earnings for the government?

Revenue raising statute

Which of the following is a difference between acceptance and revocation?

Revocation is valid only if the offeree receives it, while an offeree's acceptance is valid when dispatched

The _______ requires certain contracts to be in writing

Statute of Frauds

Poole Contractors makes a contract with Delta Resources to pay $50,000 for the supply of 500 truckloads of sand within a week. Delta Resources delivers the sand two days after the contract was made, and Poole Contractors pays it $50,000 promised in the contract. This is an instance of ________

Strict Performance

Net labs order 30 desktop computers from iDeal, a local computer dealer. Net Labs requires that each computer has a 2.6 GHz processor, 500 GB hard disk, and Windows operating system. iDeal supplies thirty desktop computers with a 2 GHz processor, 500 GB hard disks, and windows operating system. What of the following terms hold true for iDeal's performance?

Substantial Performance

Heather chooses to buy a scarf at Macy's and reads the price on the tag as $50. She uses her credit card to pay for the scarf, but post-purchase, she notices that the price tag, and receipt actually says $500. This is an instance of a (n) __________.

Unilateral Mistake

Two brothers Sam and Jim were fighting over the division of their ancestral property. After ten years of legal battle, a frustrated Sam contacted a powerful politician who subjected Jim to extreme duress to make him sign a contract of assent in favor of Sam. When Jim takes the contract to court, the contract will be declared _______.

Voidable

Why does an illusory contract lack consideration

because one or both parties can choose not to perform their contractual obligations

A court order that prohibits a person from doing a certain act is termed as a(n) _______

injunction