BLaw exam 2 (q)
Which of the following statements, if made by a seller who knows the statement to be untruthful, would not be misrepresentation of material fact resulting in a cause of action for fraud?
"There is no better can in the world"
Bob, a house builder, contracts with Ollie to build a house on Ollie's lot. The total price of the construction is $100,000, $20,000 of which will be Bob's profit. After Bob has put $10,000 worth of materials into the house, Ollie wrongfully refuses to let him finish the house. If Bob sues for damages, he will be able to collect:
$30,000
In the case of Sepulveda v. Aviles, the New York Supreme Court, Appellate Division, found evidence of undue influence in:
Aviles's use of Seals' funds and credit cards
The concept that an injured party may recover consequential damages only if the breaching party should have foreseen them was established in:
Hadley v. Baxendale
Which of the following statements is incorrect concerning liquidated damages?
Liquidated damages are enforceable even if the amount is considered to be a penalty on the breaching party
Vicki entered into a written contract to buy a car from Valley Motors. During the negotiations, the sales representative said that the car had a two-year full warranty. The written contract included a provision that stated, "This writing is the full and final expression of the parties' agreement; anything said before signing or while signing is irrelevant." The written contract did not include a warranty. Two months after Vicki took delivery of the car, she discovered that the transmission needed to be replaced. Vicki claimed that it was covered by the full warranty. Will Vicki be able to present evidence as to the sales representative's statements concerning the warranty?
No. The parol evidence rule will most likely exclude any evidence of the discussion of the warranty.
An example of the type of relationship required to find undue influence would be:
a doctor-patient relationship
A contract between a company in the U.S. and one in China, contained a clause that stated: "If an event happens which is extraordinary and out of the control of the parties such as a strike, act of God, fire, accident, or transportation difficulties, then the affected party shall be relieved of its obligations under the contract." This type of clause is:
a force majeure clause
Pamela is planning to sell her home decorating store to her daughter. Pamela has:
a greater duty to reveal problems in the business because her daughter assumes she will be honest
For the purposes of the statute of frauds, an interest in land includes:
a house, a real estate mortgage, an easement, all of the above. (all of the above)
A contract clause which specifies the amount of damages to be paid in the event of a breach is called:
a liquidated damages clause
In breach of the partnership agreement, Trimble, a partner in the partnership of Morris, Newt, and Oppie, Ltd. quits the partnership and goes to work for a competitor. The former partners may ask the court for:
an injunction to prevent Trimble from working in competition with the former partners
Vicki entered into a written contract to buy a car from Valley Motors. The written contract included a provision that stated, "This writing is the full and final expression of the parties' agreement; anything said before signing or while signing is irrelevant." This is:
an integration clause
Specific performance may be available for the breach of a contract to sell:
an original painting
Which of the following events would probably excuse performance of a contract based on commercial impracticability?
an unforeseeable trade embargo causes prices to triple
Deborah purchased a boat from Sun 'N Surf Marine. She later learned that the salesman had made misrepresentations to induce her to make the purchase. Under UCC Section 2-721, Deborah can rescind the contract:
and sue for damages whether the misrepresentation was fraudulent or innocent
If a court awards nominal damages it will generally:
award a very small amount of money
The remedy of reformation:
can be used to correct mistakes in the original context
All Seasons, Inc. ordered $5,000 worth of Christmas decorations from Santa, Inc. The shipment of decorations was to arrive no later than October 1, but did not arrive until December 1. All Seasons was able to purchase some of the unfulfilled order through other suppliers, but had to pay 15% more than the price under contract with Santa, Inc. As a result of the delay, All Seasons' sales were down 25%. All Seasons can recover:
compensatory damages and consequential damages
Sam, the seller, enters into a contract agreement to buy Betty Lou's house on the condition that he is able to secure financing at or below 6% per year. This is a:
condition precedent
Melody is a recent graduate of State Law School. She lands an impressive employment contract with the firm of Dewey, Cheathem, and Howe, Attorneys at Law, on the stated provision that she pass the upcoming bar exam. This provision in the employment agreement is a(n):
condition subsequent
Generally, a seller has no duty to disclose facts. However, there is a duty to disclose information or facts if the disclosure is necessary to:
correct a previous assertion, correct a basic mistaken assumption on which the other party is relying, report a latent defect that the buyer would not be expected to discover, all of the above are true. (all of the above are true)
The Uniform Electronic Transmission Act (UETA):
declares that a contract or signature may not be denied enforceability just because it is in electronic form
Mark's home had burned to the ground. When he met with his insurance adjuster, she accused him of burning down the house, and said she would have him criminally prosecuted if he didn't settle the claim for much less than the house was worth. Mark agreed to the settlement. If he changed his mind, he can probably rescind the settlement on the basis of:
duress
Robin and Bellman, both merchants, orally agree to a contract for the sale of $5000 of accessories. Bellman, the buyer, sends to Robin, the seller, a written confirmation of the sale, which is sufficient against Bellman under the statute of frauds and which Bellman signs. Robin does not sign. Robin fails to perform the contract and does not ship out the goods. Bellman sues. This contract is:
enforceable even without Robin's signature because both parties are merchants
A party to a contract has a duty to investigate the other party's factual statements.
false
Any contract involving a sale of goods of $100 or more must be in writing
false
Pushy Pat, a persuasive salesman, talked Nice Nancy into purchasing something she didn't really need or want. Nice Nancy may rescind the contract because of undue influence.
false
When courts consider economic duress, they consider all the following factors EXCEPT:
relative size of the contract
Under the UCC, which of the following contracts may be enforceable, even without a written memorandum?
the seller is specially manufacturing the goods for the buyer, the seller admits in court that there was a contract, the seller has delivered the goods, all of the above (all of the above)
Jackie hires Charles to lay new carpet in her bedroom. Charles does such a bad job, that the only way to fix the carpet is to start over and relay the carpet. Which of the following best describes this situation?
this is a material breach. Jackie owes nothing to Charles
Jeff was a subcontractor, bidding on a contract for ACE Corp., the general contractor. When adding up the total of materials and labor, Jeff's secretary mistakenly moved the decimal point one place, ending up with a bid of $3500 rather than $35,000. ACE Corp. accepted Jeff's bid, mostly because all the other bids were over $30,000. When Jeff learned of the mistake, he tells ACE Corp. that he cannot do the job for $3500. If ACE Corp. sues to enforce this contract, what is the most likely result?
this is a unilateral mistake, but one where ACE Corp. knew that a mistake had been made. Jeff should be able to rescind the contract
Compensatory damages are typically assessed against the breaching party:
to put the non-breaching party in the position it would have been in if the contract hadn't been breached.
Which of the following types of contracts cannot be either contradicted or supplemented by evidence of prior agreements or expressions?
totally integrated contracts
A court may, at times, discharge a party who has not performed.
true
A party injured by fraud generally has the choice of suing for damages or rescinding the contract.
true
After her 18th birthday Lora may, by words or action, ratify a contract she made during the previous year.
true
Under the statute of frauds, the writing must: be signed by the defendant; and must state with reasonable certainty the name of each party, the subject matter of the agreement, and all of the essential terms and promises.
true
reformation is:
uncommon
When a contract falls within the statute of frauds but is not reduced to a writing, the contract is:
unenforceable
Vince has begun forgetting things and is becoming very difficult to get along with. He is 85, has been ill, and is very fond of his housekeeper Annie. He gives a deed to Annie for all of his real property. At Vince's death, his children, who got only his photograph albums according to the will, ask that the deed be set aside and the land be put back in the estate for purposes of division among all the children. The probable result will be:
unless the children can prove that Vince was unable to understand what he was doing, or that Annie used her position to improperly influence Vince, Annie can keep the property.
The first step a court takes in choosing a remedy is to determine:
what interest it is trying to protect
Peter, a minor, purchased a car from ACME Motors. Using a fake ID, he misrepresented his age to be 18. The contract is fully executed. Which of the following is correct?
A) Peter cannot disaffirm the contract because a car is a necessity. B) Peter cannot disaffirm the contract because of his misrepresentation. C) Peter can disaffirm the contract, because a minor must be saved from his own poor judgment, including his lie. D) Either b or c may be applicable depending on the law of the jurisdiction in which the contract was formed. (D. Either b or c may be applicable depending on the law of the jurisdiction in which the contract was formed)
If a court orders rescission and restitution of a contract under which Nala sold a baseball card to Shirley in exchange for $450:
A) Shirley must return the baseball card B) Nala must return the $450 C) Both a and b D) neither a nor b C, both a and b are correct
Dana hires Paris to paint a portrait of her poodle, "Mack." The painting is to be done to Dana's personal satisfaction. Upon completion of the painting, which of the following will be true?
Dana may refuse to accept the painting if she really does not like it
Derek and Abyan were discussing business over lunch when they agreed on the sale of a five-acre parcel of land. Since neither of them had any paper with them, Derek wrote the following on a napkin: "Abyan agrees to purchase from Derek a 5-acre parcel located at the local address of 123 105th Street, St. Joseph, Minnesota, U.S.A. for the price of $4,500 per acre. Transfer of title, payment, and possession to take place on May 1, 2011." Abyan signed the napkin. On May 1, 2011, Derek was ready to close the deal and transfer title but Abyan refused to pay the purchase price. If Derek sues Abyan for the price of the land, the most likely result will be:
Derek will win because the writing is sufficient under the statute of frauds
The Grand Performance Hall is in the process of remodeling and is scheduled to open for business after being closed for 50 years. As part of the remodeling, it is installing a new sound system. The sound system is to be installed by Sound Systems, Inc. on or before April 10. Opening night of the hall is May 1. The contract states that "time is of the essence" because of the opening-night deadline. Sound Systems has some financial difficulties and doesn't deliver the system until April 20. Grand Hall refuses to accept it, and Sound Systems sues. What result?
Grand Hall wins, the contract date was strictly enforceable
Dodger bought an insurance contract from Liberty Farm Co. The policy contained a clause stating that all claims for losses had to be reported within 45 days after the date of the loss or the claim would be barred. Time is stated to be of the essence. Dodger sustained a covered farm loss, but did not report it to Liberty Farm until 50 days later. Liberty Farm denied coverage for the claim. If Dodger sues, who wins?
Liberty Farm wins; there was failure of a condition subsequent
Marty, a 16-year-old, contracted with Cream-of-the-Crop Cycles to buy an $8,000 motorcycle. He agreed to make monthly payments until the purchase price plus interest were paid in full. It is three years later and Marty has not disaffirmed the contract and has made regular payments on the cycle since turning 18. Which of the following is correct?
Marty has ratified the contract and is now bound by its terms.
Alfred orally promised to pay Robert a salary of $30,000 per year for five years and his moving expenses up to $10,000 if Robert would quit his job and come to work for him at his manufacturing plant. Robert agreed to do so, but requested a written contract. Alfred assured him that the company attorney would prepare such a contract as soon as possible, but Alfred needed Robert to start at once. Accordingly, Robert sold his house, moved his family, and commenced to work for Alfred. He was fired without cause two months later. No written contract was ever executed. Can Robert enforce Alfred's oral promise?
Maybe. Robert should go to court under the theory of promissory estoppel. Alfred made an oral promise that Robert relied upon, and the way to avoid injustice is to enforce the promise
Ron, a minor, goes to the hospital for treatment of the flu. On the new-patient form Ron signs, he agrees to pay for any care or treatment he receives. When billed for the treatment:
Ron must pay for the value of the benefit he received, because medical care is a necessity
Sonny, a college student, places a telephone order for a new computer from Computers, Inc. The price of the computer is $1500. The clerk who takes the order sends Sonny a copy of the invoice. The next week, Sonny calls back and tries to cancel his order.
Sonny can cancel the order; the invoice is unenforceable against him, as he did not sign the invoice
The main difference between the UCC requirement for a writing for a contract for the sale of goods and the common law is that the:
UCC does not require all the terms of the agreement to be in writing
Mary contracted to buy 100 table lamps. Under the terms of the agreement, Mary is to pay for the lamps upon delivery. This is an example of:
a concurrent condition
Farmer Elvin is holding 200 pounds of potatoes in storage for Chef Noble but Chef Noble has breached the contract by failing to pay for the potatoes. The potatoes are beginning to rot. If Farmer Elvin sells the potatoes to a local diner to make potato soup and salad, then this action would be considered:
a reasonable mitigation of damages
Which of the following would suffice for a signature on a writing under the statute of frauds?
a stamped signature, a handwritten signature, a name keyed at the bottom of an email, any of the above would suffice. any of the above would suffice; judges define "signature" very broadly
In order to satisfy the statute of frauds, a writing must:
be signed by the defendant and contain the name of each party, the subject matter of the agreement, and the essential terms and promises
Ethel's Exercise World plans to order three weight machines from Pete's Push, Pedal and Pull, Inc. for a total of $15,000. Pete's demands that Ethel's friend, Moneybags, a wealthy independent businesswoman (not connected with Ethel's business in any way) promise to pay Pete's for the three machines if Ethel's Exercise World does not. Which of the promises in this problem must be in writing to be enforceable?
both Moneybag's promise and Ethel's Exercise World's promise
Amy Hudson has been trying to purchase Glen Cappel's antique desk for some time, but Glen has been reluctant to sell. One evening Glen said to Amy, "Okay, I'll sell the desk for $550." Amy replied, "Thank you, Glen. I accept." The agreement was not reduced to writing, but Glen and Amy did shake hands. Two days later, Amy sent Glen a letter outlining the terms of the agreement, and stating that she would deliver $550 cash according to the agreement within ten days. The letter was signed, "Best regards, Amy." Later, Amy had second thoughts, and refused to go through with the purchase. Nothing had been exchanged at this point. Glen:
can enforce the contract against Amy because the statute of frauds is satisfied under this situation
Sea Rovers, Inc. contracted to sell 1,000 pounds of shrimp to the Seafood Shack with delivery on June 1. On May 1 Sea Rovers advised the Seafood Shack that it would not be able to deliver the shrimp. The Seafood Shack:
can sue Sea Rovers immediately for breach of contract
Mercury Motors inadvertently mixes up a work order on Peter's car. Peter brought the car in to have the tires rotated. Mercury tuned up the motor by mistake, conferring a benefit on Peter. If Mercury Motors insists that Peter pay for the price of the tune-up, Mercury Motors:
cannot recover its expectation interest because there was no enforceable agreement
Ron operates a garbage pickup business. He contracts to pick up garbage from an apartment complex for the next 52 weeks at a price of $150 per week. Unexpectedly, the landfill center where Ron takes the garbage to dispose of it, files for bankruptcy. As a result, Ron must travel an additional 100 miles to the nearest landfill center, turning Ron's expected profit into a loss of $40 per week. Ron's best argument in support of his petition to be discharged from the contract is:
commercial impracticability
The distinction between a condition precedent and a condition subsequent:
determines who has the burden of proof
Which of the following is least likely to be regarded as a necessary?
educational expenses
Tuan is president and sole shareholder of Entertainment, Inc. Entertainment, Inc. wishes to borrow money, but to do so, the bank requires Tuan to orally agree to personally pay the debt of the corporation if Entertainment, Inc. cannot. Tuan's guarantee to repay is:
enforceable because of the leading object rule
Willis and Leslie orally agree to the sale of a parcel of land for $50,000: one-half payable now as a down payment; one-half payable in 30 days at the time of closing when the title will be transferred. The buyer, Willis, is to have possession immediately. Willis pays Leslie $25,000, takes possession of the land, and starts building a house. At the time of closing, Willis has made a substantial beginning on the house. However, Leslie refuses to transfer the title, claiming the oral contract is not enforceable. This contract is:
enforceable, because Willis has partially performed the oral contract and made improvements on the land.
Abdulla hired Granite Construction to build an addition onto his home. Granite Construction dug the foundation but then abandoned the project. Granite Construction is entitled to receive the full contract price minus the value of the defects.
false
Alice signs a contract with Bob to buy Bob's house for $150,000, with the clause, "if I am able to obtain a mortgage loan for $125,000, at no more than 7% interest, payable over 15 years." Assume that Alice tries but is unable to obtain the described loan, and therefore refuses to proceed with the purchase. Alice is in breach of the contract.
false
Assume that Jessie and Lester have formed a contract whereby Jessie agrees to deliver 10,000 dozen "Grade A Large Eggs" to be shipped in recycled paper cartons. A shortage of paper makes paper cartons much more expensive, so Jessie uses styrofoam cartons and ships the eggs. Lester is entitled to cancel the contract based on this deviation of terms in the contract.
false
Concurrent conditions arise when there is both a condition precedent and a condition subsequent.
false
Dr. Gonzalez ordered specialized surgical equipment from Physician's Supply Co., but his order was not delivered by the agreed date. Gonzalez is under no obligation to minimize damages since the contract was breached by Physician's Supply, not Gonzalez
false
Either party may demand rescission of a fully executed oral contract if it was required to have been in writing under the statute of frauds.
false
Expectation interest can best be described as money spent in reliance upon the agreement.
false
Fraudulent, but not innocent, misrepresentation permits the injured party to rescind a contract.
false
Generally, neither a "time is of the essence" clause nor a "force majeure" clause will be recognized by the courts because these types of clauses are seen as a violation of public policy.
false
Hannah orally agrees to sell her house to Brett for $175,000. If she delivers the deed to Brett with the expectation of payment in two weeks and he fails to pay, most courts will not enforce the contract since it was not in writing.
false
If a salesperson says, "This is a great car and it's really fun to drive," but the car turns out to be a lemon, the salesperson has committed fraud.
false
In negotiating the purchase of a vehicle, the sales representative told Karla, "I guarantee that you will be personally satisfied with this car." The guarantee was written on the contract when Karla purchased the car. If a controversy arises over Karla's satisfaction, the court will apply a subjective standard, which means Karla's judgment must be reasonable.
false
Injunctions are frequently used by courts to force employees to complete their contractual obligations with their employers.
false
Irving is shopping at the local Computers R Us store and agrees to buy a computer for his home "on the condition of personal satisfaction." If Irving takes the computer back to the store stating that he doesn't like the computer, then the seller must accept the return of the computer and terminate the contract.
false
Liquidated damages are awarded to parties who have experienced an injury to their legal rights but have no actual loss.
false
Marvin contracts with House Painters R Us to paint the interior of his house lemon yellow throughout. The total contract price is $7,000. House Painters R Us's anticipated profit on the job is $4500. If Marvin breaches the contract before House Painters R Us has begun work on the job and has not incurred any expenses, then its damages will be $7000
false
Most contracts are discharged by mutual agreement of the parties.
false
Nominal damages are awarded in contract cases in which a damage amount was named in the contract.
false
Patrick owned an acre of land which was being divided into building lots. Nancy was interested in purchasing the corner lot. In a signed writing, Patrick stated "I will sell Nancy Grimes a lot on Route 70 for $5,500 cash, payable on April 30, 2012." This writing is sufficient under the statute of frauds to make the contract enforceable.
false
Ramon purchased 5,000 pounds of coffee from Quick Jump Coffee. The coffee was to be delivered on September 1. Since the contract included a date for performance, time is of the essence and the delivery date is strictly enforceable.
false
Ramona, age 42, orally agreed to work for Brahma, Inc. for the rest of her life for $50,000 per year. This agreement would not be enforceable since it violates the one-year rule of the statute of frauds.
false
Sweet Plantation, Inc. made a written contract with Candy, Inc. whereby Sweet Plantation agreed to supply all of Candy's sugar requirements for the next year at $.25 per pound. A dispute arose as to how much sugar Sweet is to supply. The parol evidence rule will bar Sweet's introduction of evidence concerning the intent of the requirements of Candy
false
Tess, a tenant, moves from her apartment in breach of the lease agreement. The landlord, Lenny, may not attempt to rent the apartment until the date of the lease expiration, and so has no recourse to minimize damages.
false
The age of majority to contract in all states is 21.
false
The statement, "You will have a job with Snelling & Snelling as long as you complete your degree in business administration this May" does not create a condition because it does not include the phrase "provided that."
false
Whittle sent an order over the Internet for a $1,200 garage door. His name keyed onto the order will only be effective as a signature sufficient to create a "writing" "signed by the party against whom enforcement is sought" if he follows up with a signature on paper.
false
M & E contracted to sell 500 music stands to Coda, Inc. M & E shipped the stands in accordance with the agreement. Coda paid for the stands as promised. The contract between M & E and Coda is discharged by:
full performance
When a party to a contract makes a unilateral mistake, the contract:
generally cannot be rescinded by the mistaken party unless the contract is unconscionable or it is proven that the non mistaken party knew of the error
As set forth in the Restatement Second of Contracts, which of the following duties are imposed on the parties in the performance and enforcement of a contract?
good faith; fair dealing
Costs to store a vehicle for a short period of time after an auto dealer fails to complete the contract to purchase the vehicle would be:
incidental damages
A condition:
is an event that must occur before a party becomes obligated under a contract
In January 2008, Professor Noe entered into a contract with State University. She agreed to teach full time during the 2008-2009 academic year. Professor Noe died on May 31, 2008. Her estate:
is discharged from any further obligations under the contract
Jennifer substantially performs her service contract with Gretchen. Due to Jennifer's failure to render complete performance, Gretchen:
is required to pay the full contract price, minus the value of Jennifer's defective performance
The most accurate statement regarding economic duress is:
it may be grounds for rescission
Statutes of limitations:
limit the time in which an injured party may sue
Larson entered Forrester's Auto Mart to purchase a used car. Larson found a vehicle with a sales price of $11,000. After Forrester answered all of Larson's questions, Forrester and Larson agreed to a sale. As Larson was leaving to get the money to pay for the car, Forrester told Larson that Robert Redford formerly owned the car. Larson later learned that Robert Redford had never owned the car. If Larson seeks to rescind the deal based on Forrester's statement, Larson will:
lose because he will not be able to prove reliance on the misrepresentation
Ryan, a minor, contracted to sell his auto to Ed, a 28-year-old. Ryan later refused to complete the sale. If Ed sues to enforce the contract, Ed will:
lose, because the contract is voidable by Ryan
Under the UCC, if a seller of goods breaches the contract, the buyer:
may "cover" and then receive the difference between the original contract price and the "cover" price
Mulligan Domestics Co. breached a contract by refusing to accept its order for 60 bolts of fabric from Wellington Mills, although the fabric met the contract specifications. Wellington:
may choose not to resell the fabric and settle for the difference between the contract price and the market value
A court:
may refuse to enforce an express condition intended by the parties if the court determines it is unfair and harmful to the general public
Martin, Human Resources Director for Spring Co., sent Lynn the following signed letter: "This letter confirms our offer to you. We will pay for your moving expenses, up to $1,500. Your starting date will be February 1, and you will become eligible for health care benefits as of May 1. You will receive a starting salary of $36,500 annually, with reviews and eligibility for increases at six months, 12 months, and annually thereafter. Vacation will be for two weeks a year after one year." Spring fired Lynn eight months after she started to work, and Lynn sued arguing the letter constituted a memorandum of an oral contract for employment for five years. Is the letter sufficient to satisfy the statute of frauds?
no, to satisfy the statute of frauds, the memorandum must contain all essential terms of the contract
Linda agrees to buy Missy's Greyhound race dog for $2,000. Linda is to deliver the money and take possession of the dog the next morning. That night, running his best race ever, the dog runs away from Missy, never to be seen again.
none of the above; the contract duties are discharged
Mentally infirmed Sasha contracts to purchase a piano for $2,500 in 60 monthly installment payments. Six months later she tries to void the contract on grounds of mental impairment. A court will:
normally void the contract but will require Sasha to return the piano
Harry agreed to pay $100 to rent a rooftop spot in downtown Seattle to watch the New Year's Eve festivities. The festivities were unexpectedly cancelled because of concern over a terrorist attack. Harry is:
not obligated to pay under the frustration of purpose doctrine
Angie, a minor, wants to avoid a contract she made with Cumberland Cycles. She may disaffirm the contract by:
notifying Cumberland orally that she will not honor the agreement, filing a lawsuit to have a court formally cancel the contract, just refusing to perform her obligations under the contract, All of the answers are correct. (all of the answers are correct)
Renita, a merchant, has received a signed, written confirmation from Merchants, Inc. referring to goods she had not ordered. Renita should:
object to the confirmation in writing within 10 days
If a condition does not occur:
one party will probably be discharged without performance being required
In a promissory estoppel case, a court will generally award
only reliance damages
Which of the following promises ordinarily must be in writing to be enforceable?
promises made as a part of a prenuptial agreement, the agreement to sell a car for $1500, the promise by an executor of an estate to pay a debt of the decedent, all of the above (all of the above)
If Jane persuades Linda to buy her horse by telling Linda that the horse runs "like the wind," then Jane's statement is:
puffery
Rich and Archie sign an agreement in which Archie agrees to deliver ten cases of champagne in 5 days. The parties negotiated and meant to say in the written agreement, delivery in 50 days. If the two cannot settle this dispute, and Archie still wants to deliver the champagne, then Archie should sue for the remedy of:
reformation
Under a contract for the sale of land, the statute of frauds:
requires the defendant to sign the agreement
When a business is concerned about selling to minors because of their right to disaffirm contracts, the business might protect itself by:
requiring an adult co-signer
Al contracted to sell his house to Bev. Subsequently, they both changed their minds and agreed to cancel the contract. The contract between Al and Bev is discharged by:
rescission
Larry purchased a Leisure Lawnmower because the company salesperson intentionally misled him by assuring him that the mower was self-propelled, had a mulching feature, and had a five-year unlimited manufacturer's warranty. When Fred finds out that his new Leisure Lawnmower is not self-propelled, does not mulch, and has a 90-day warranty, he may successfully sue for:
restitution and possibly punitive damages
Which of the following is most likely to constitute fraud?
silence as to a toxic waste problem on real property that the buyer would not reasonably find
Scott is trying to introduce oral evidence in court to alter the terms of a written contract he had with Bonnie. Bonnie has raised the parol evidence rule as an objection to Scott's testimony. In which of the following circumstances will Scott not be able to introduce the oral evidence?
the contract has an integration clause in it and Scott's point of contention is covered in detail in the contract, although not to his favor.
Brahma entered into an oral agreement to sell 50 jet skis to Summer Sports. Brahma delivered 20 of the skis on May 1. On June 1, Summer Sports notified Brahma that it will not honor the agreement. Which statement is correct?
the contract is enforceable for 20 jet skis
Marty, a 16-year-old, contracts with Cream-of-the-Crop Cycles to buy an $8,000 motorcycle. Marty agrees to make monthly payments until the purchase price plus interest are paid in full. Which of the following is correct?
the contract is voidable by Marty
Abby dies, and her good friend, Clay is appointed to administer Abby's estate. Abby's house was in poor condition, so Clay orally hired a contractor to make repairs. Clay also orally promised that if the estate could not pay the repair bill, he would pay it even though he does not live in the house and has no entitlement under Abby's estate. The estate does not pay the repair bill. Who can the contractor collect from, if anyone?
the contractor can collect from the estate only
Which of the following is an example of incidental damages you might be awarded if you are wrongfully terminated from your job?
the costs of mailing resumes to prospective employers
Ralph is a professional football player. He signs a valid contract with the Jets. Later, the Giants offer him more money, so he signs a contract with them. If the Jets sue Ralph, the most likely result would be?
the court will enjoin Ralph from playing with any team other than the Jets
Solomon breaches his contract with Neal to purchase the 500 pairs of socks he had promised to buy. Neal is able to sell the 500 pairs to Renny for a much lower amount. Neal then sues Solomon for damages. Neal will be able to recover:
the difference between Solomon's contract price and the amount paid by Renny
Oxtron, Inc. substantially performed its obligations under a service contract. Oxtron is entitled to receive:
the full contract price minus the value of the defects
Claude agrees to lease his house to Irvin for nine months, the lease to begin six months from the signing of the contract. Under the statute of frauds:
the lease is required to be in writing because of the one-year rule
Which of the following is NOT a true statement about fraud?
the plaintiff must show that although the defendant acted in good faith, the statement was material because the defendant expected the plaintiff to rely on it and enter into the contract
A wholesaler of coffee notifies a retailer that it cannot fulfill its contractual obligation to deliver 1,000 pounds of coffee at the agreed upon price of $2.00 per pound next month because of recent price increases in coffee. The retailer may treat the wholesaler as having breached the contract and sue for damages even though the wholesaler's performance is not due until next month.
true
Alice offers to sell her car to Barry for $500, and Barry accepts. Alice's car has a market value of $1,000 but this fact is unknown to Alice. The contract is enforceable.
true
All states allow the remedy of rescinding a contract for the sale of goods while still allowing the remedy of suing for damages.
true
Amanda, a recent university graduate, needed a car to get to her new job. To help Amanda secure a loan for the car, Ted, a friend, agreed to pay the loan should Amanda default. Ted's promise to pay the loan is a collateral promise. His promise must be in writing to be enforceable.
true
Banner enters into a contract with Sylvia to buy her house for $150,000. Sylvia decides later not to sell because she is so emotionally attached to the house. Banner insists that he is entitled to the house. Banner can successfully sue for specific performance.
true
Bry, Inc. and Gangl Co. entered into an oral agreement for the sale of 3,000 sweaters. Both parties performed as required under the contract. Bry delivered the sweaters and Gangl accepted and paid for them. Since the contract is fully executed, it makes no difference that it was oral.
true
Carswell, a contractor, enters into a contract with Helen, a homeowner, to remodel her bathroom. The contract provides a specific completion date. The contract provides that if Carswell does not have the job finished by the date, Helen may deduct $200 per day from the contract price until the job is finished. This is an example of liquidated damages.
true
Contract rescission can sometimes be based upon a unilateral mistake.
true
Damages must be estimated with reasonable certainty
true
Ernest operates an ice cream stand during the months of May, June, July, and August. Ernest's ice cream machine is broken and needs a new part to run. He contracts to have the part shipped to him by special carrier. Ernest emphasizes that the part needs to be delivered by April 25 and the carrier agrees, knowing that Ernest intends to open his stand May 1. If the shipper fails to deliver the part on April 25, Ernest will be able to recover consequential damages caused by the delay.
true
Frank suffers from a mental impairment due to a brain injury from a airplane accident. He contracts with Glena to purchase her dining room furniture. A month later, he tries to void the contract. If he is unable to return the furniture, a court will not rescind the agreement unless Frank can show that Glena acted in bad faith.
true
If a minor can cancel a contract, it can be done at any time during minority or within a reasonable time after reaching majority.
true
Monumental, Inc. contracts with Champion Builders to erect a three-story office building on a parcel of land it has purchased. Before construction begins, the local zoning board changes the zoning of the parcel and those adjoining it to residential use only. Monumental's contract with Champion is discharged.
true
Most courts hold that a seller of goods is not entitled to consequential damages.
true
Parol evidence refers to anything (other than the written contract itself) that was said, done, or written before or as the parties signed the contract.
true
Raymond agrees to transfer an easement right to Sandra for $1,000. This contract is within the statute of frauds and therefore needs to be in writing to be enforceable.
true
Rest Well Hotel orally ordered 1,000 blankets monogrammed with its initials, RWH, from TriColor Textiles. TriColor had just finished monogramming the blankets when Rest Well called and canceled the order. TriColor will be able to enforce the agreement even though there was no writing.
true
Roger, a minor, buys a stereo from Tuneland, Inc. Roger uses the stereo for a few months, returns it to Tuneland, and demands his money back. In a majority of states, Roger may return the stereo and he does not have to pay for the use of the stereo or the damages.
true
Specific performance is available when the subject matter of the contract is unique.
true
Spencer, age 18 and of sound mind, has the legal capacity to contract.
true
The Milicic v. Basketball Marketing Company, Inc. case illustrated the proper use of a preliminary injunction
true
The UCC recognizes commercial impracticability as a ground for discharge of a contract.
true
The Uniform Commercial Code provides that, under certain circumstances, a merchant may be liable on a written contract, even though that merchant has NOT signed it.
true
The legal right to sue for a breach of contract is subject to a statute of limitations
true
The original statute of frauds is the English law that began the practice of requiring written evidence of certain kinds of contracts, but now the British government has repealed the writing requirement for most contracts.
true
Travis had too many beers at the baseball game. Ed realized Travis was so intoxicated he wouldn't know what he was doing, so he got Travis to sign a promise to sell his motorcycle to Ed for $50. When Travis gets sober, he may void the contract.
true
Under the UCC, the buyer is entitled to consequential damages if the seller could have reasonably foreseen them.
true
Generally, reasonable liquidated damage clauses will be enforced:
when actual damages are difficult to determine
