BUS 115 New New #2

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The nonbreaching party normally may not recover punitive damages in a breach of contract claim.

True

The party to whom an offer is made is an offeree.

True

The workers at Thom Trucking went on strike over wages. Thom Trucking may hire permanent replacement workers.

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 a unilateral contract only one party makes a promise.

True

Under the "mailbox rule," some acceptances are deemed effective upon dispatch.

True

Under the common law, an offer must contain reasonably definite terms to be enforced.

True

Under the common law, an offeree's proposal to make a material change in the terms of an offer will most likely constitute a counter-offer.

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

When a contractor submits a bid for a construction project, the submission of the bid is an offer.

True

When both parties to a contract are minors, either or both of them may avoid the contract.

True

Generally, reasonable liquidated damage clauses will be enforced:

when actual damages are difficult to determine.

96. _____ A model used in connection with selling goods will usually amount to a warranty that the goods will be as the model indicates.

98. _____ The implied warranty of merchantability requires that goods be fit for the ordinary purposes for which they are intended.

A contract may violate public policy even if the agreement does not violate a statute.

A party injured by fraud generally has the choice of suing for damages or rescinding the contract.

Dealer wins; there were no express warranties and all implied warranties have been successfully disclaimed.

Tu-thumbs buys a used paint sprayer from the local paint store. The sprayer had a large sign on it which said "AS IS." The dealer made no promises or statements concerning the performance of the paint sprayer. When Tu-thumbs attempts to spray paint his house, the trigger on the sprayer sticks in the "on" position and before Tu-thumbs can pull the electrical cord to cut the power, paint is sprayed all over his prize Borzoi dog that is scheduled to be shown in a dog show the next day. Tu-thumbs sues the dealership. Who wins?

If Jane persuades Linda to buy her horse by telling Linda that the horse runs "like the wind," then Jane's statement is:

D. Puffery

25. _____ Nathan promises to take Debra to the show on Friday night. He then changes his mind so that he can stay home and study his business law. Nathan can be sued for breach of contract by Debra for breaking his promise.

90. _____ Parol evidence is never admissible.

Morality plays no part of gambling contract legality.

Written defamation is called "slander."

False

in a reasonable time.

if a contract does not provide for a time for inspection, the UCC allows inspection:

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.

As it applies to minors, which of the following is the least likely to be regarded as necessary?

educaitonal expenses

A copyright would protect a photograph.

true

A purchase-money security interest arises when a seller or lender provides a buyer with the "purchase money" to buy goods.

true

Prior to the Industrial Revolution, the primary law of employment was that, absent an agreement otherwise, a worker was hired for a year at a time.

true

Punitive damages are intended to punish the defendant.

true

Some courts have held that employee handbooks create binding contract terms.

true

Some torts are crimes.

true

Strict liability for defective products requires the plaintiff to show there was a defect in the product that caused the injury.

true

The filing of a petition for bankruptcy will automatically stay most legal actions against the debtor.

true

The implied warranty of merchantability requires that goods be fit for the ordinary purposes for which they are intended

true

The state office in which a financing statement should be filed depends on the debtor's location.

true

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.

A lawyers best friend is...... (fill in the blank)

promissory estoppel

Under the UCC statute of frauds, the writing for a sale of goods must:

state quantity.

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.

21. _____ A quasi contract is another name for an oral contract.

49. _____ Under a unilateral contract only one party makes a promise.

68. _____ The elements to a contract are agreement, consideration, legality, and capacity.

7. _____ A promise to act or to refrain from doing an act can serve as consideration.

22. _____ "I promise to pay you $100 if you will promise to fix my car next month." This is an offer for a unilateral contract.

Most courts hold that a seller of goods is NOT entitled to consequential damages.

Both a and b.

The identification of goods permits the buyer to:

Before a surety can be required to answer for the debt of a debtor, the debtor must have defaulted on the underlying obligation.

false

Collateral is not the subject of a security interest.

false

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.

A revocation normally is effective at the time it is dispatched by the offeror.

False

79. _____ Agreement is usually evidenced by an offer and an acceptance.

The elements to a contract are agreement, consideration, legality, and capacity.

True

What phrase is critical to the validity of a requirements contract?

"in good faith"

A void contract is a contract that one or both parties may cancel, at their option.

False

Advertisements are typically considered valid offers.

False

Robert agrees to buy a car from Jane for $400. This contract must be in writing to be enforceable.

False

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: a. Ron must pay for the value of the benefit he received, because medical care is a necessary. b. Ron must pay for the benefit he received because the contract is fully executory. c. Ron must pay for the benefit he received because he ratified the contract. d. Ron does not have to pay for the benefit he received

A Ron must pay for the value of the benefit he received, because medical care is necessary.

the buyer had a legitimate reason for the initial acceptance.

A buyer may revoke an acceptance of goods if:

may be allowed the remedy of specific performance.

A buyer who is unable to obtain cover:

Acme Co. offers to buy 1000 widgets from Widget World Co. The written offer provides for 1000 at $10 per widget, to be delivered May 1. The offer has no other provisions. Widget World sends a written acceptance. However, the acceptance also states that if any claim arises under this contract, Widget World must be notified within 10 days. Acme does not object to this provision. Both parties are merchants. Which of the following best describes this situation?

A contract exists. If the additional terms are construed to be material, they are not part of the contract. If the additional terms are not material, they are part of the contract.

What is not required to establish promissory estoppel?

A promise made by the plaintiff in response to the defendant's promise.

Pamela is planning to sell her home decorating store to her daughter. Pamela has:

A. A greater duty to reveal problems in the business because her daughter assumes she will be honest

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:

A. An integration clause

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:

A. 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:

A. Can sue Sea Rovers immediately for breach of contract

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:

A. Condition precedent

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?

A. Dana may refuse to accept the painting if she really does not like it

The Uniform Electronic Transmission Act (UETA):

A. Declares that a contract or signature may not be denied enforceability just because it is in electronic form

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:

A. Full performance

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?

A. Grand Hal wins; the contract date was strictly enforceable

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?

A. No. The parol evidence rule will most likely exclude any evidence of the discussion of the warranty

Which of the following types of contracts cannot be either contradicted or supplemented by evidence of prior agreements or expressions?

A. Totally integrated contracts.

Does the Family and Medical Leave Act apply to professionals like CPAs?

A. Yes, if they work for a company with at least 50 workers.

AAA and XXX companies are both major international conglomerates. They are negotiating a contract whereby AAA will install a computer system for XXX. One clause in the contract states that AAA will not be liable for damages caused by the negligent installation of the computer system, except that AAA warrants the system and will fix any problem for a period of two years following installation. AAA completes the installation of the computer system. XXX loads extensive amounts of information on the system, but all of it is destroyed because AAA negligently installed the memory chips. AAA fixes the memory, but XXX incurred significant expenses in recreating the lost information. XXX sues for these expenses. AAA defends with the noted clause in the contract.

AAA wins; this exculpatory clause is enforceable.

Which of the following offers are considered to be irrevocable for a given period?

ALL (firm, option, writing)

Angie, a minor, wants to avoid a contract she made with Cumberland Cycles. Which is a valid way for Angie to dis affirm the contract?

All of the answers are correct.

a doctor-patient relationship

An example of the type of relationship required to find undue influence would be:

Which of the following exculpatory clauses will most likely be enforceable?

An exculpatory clause that relieves a riding stable of negligence.

Jerry offers to shovel the snow from Ben's driveway for $35. Ben replies "OK." This is an example of:

An express, Bilateral Contract.

good faith; fair dealing

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?

not reject the installment if those in the food industry expect a small percentage of spoilage with fresh fruits or vegetables

Assume that Sherrie's Cherries contracts with Dessert World to sell and ship 600 pounds of cherries in three equal installments of 200 pounds each. If the first installment arrives with 5 pounds of spoilage, then Dessert World may:

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:

B. A 'force majeure' clause

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:

B. A concurrent condition

Which of the following events would probably excuse performance of a contract based on commercial impracticability?

B. An unforeseeable trade embargo causes prices to triple

In order to satisfy the statute of frauds, a writing must:

B. Be signed by the defendant and contain the name of each party, the subject matter of the agreement, and the essential terms and promises

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:

B. Commercial impracticability

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):

B. Condition subsequent

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, 2008." Abyan signed the napkin. On May 1, 2008, 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:

B. Derek will win because the writing is sufficient under the statute of frauds

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:

B. 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:

B. Is required to pay the full contract price, minus the value of Jennifer's defective performance

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?

B. Liberty Farm wins; there was a failure of a condition subsequent

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?

B. 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.

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:

B. Recission

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?

B. The contract is enforceable for 20 jet skis

Abby dies, and her good friend, Claire is appointed to administer Abby's estate. Abby's house was in poor condition, so Claire orally hired a contractor to make repairs. Claire 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?

B. The contractor can collect from the estate only

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:

B. The lease is required to be in writing because of the one-year rule

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:

B. UCC does not require all the terms of the agreement to be in writing

When a contract falls within the statute of frauds but is not reduced to a writing, the contract is:

B. Unenforceable

Mentally infirm 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: a. normally void the contract without requiring anything further on Sasha's part. b. normally void the contract but will require Sasha to return the piano. c. ordinarily not void the contract unless Sasha had a court-appointed guardian at the time she entered into the contract. d. not void the contract unless Sasha agrees to have the court appoint a guardian for her.

B. normally void the contract but will require Sasha to return the piano.

Since the goods are to be moved, title passes to the buyer when the seller completes its transportation obligation. Here title will pass when the seller puts the goods into the possession of the carrier at the place of shipment. With F.O.B. place of shipment, the seller bears the risk until the goods are in the possession of the carrier

Baker Furniture sold 50 living room sets to King's Department Store. The parties did not agree on passage of title, but the delivery term was F.O.B. place of shipment. Discuss title and risk of loss regarding the furniture.

The contract is enforceable for 20 jet skis.

Neither is responsible based upon the doctrine of true impossibility.Neither is responsible based upon the doctrine of true impossibility.

Buddy was hired to play drums for a rock group scheduled to tour the Midwest. Part way through the tour, Buddy was tragically killed in a plane crash. The tour had to be discontinued until a new drummer could be found. The band lost money on the tour. Is Buddy's estate or agent responsible for the loss to the band?

that title to the goods pass between the seller and the buyer and that a price be paid for the goods.

By definition, a sale under Article 2 of the UCC requires:

81. _____ Under the common law, an offer must contain reasonably definite terms to be enforced.

83. _____ A promise to do some specified thing in the future is an offer.

31. _____ If an offer states that it MUST be received by a certain date, receipt is presumed in those situations when acceptance is mailed.

An example of the type of relationship required to find undue influence would be:

C. A doctor-patient relationship

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?

C. Both Moneybag's promise and Ethel's Exercise World's promise

The distinction between a condition precedent and a condition subsequent:

C. Determines who has the burden of proof

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 pay the debt of the corporation if Entertainment, Inc. cannot. Tuan's guarantee to repay is:

C. 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:

C. Enforceable, because Willis has partially performed the oral contract and made improvements on the land

Statutes of limitations:

C. Limit the time in which an injured party may sue

Renita, a merchant, has received a signed, written confirmation from Merchants, Inc. referring to goods she had not ordered. Renita should:

C. Object to the confirmation in writing within 10 days

Under a contract for the sale of land, the statute of frauds:

C. Requires the defendant to sign the agreement

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:

C. 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

35. _____ The law enforces all promises, therefore, all promises are contracts.

the lease is required to be in writing because of the one-year rule.

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:

37. _____ An offer can never be validly accepted by the offeree's silence.

to put the non-breaching party in the position it would have been in if the contract hadn't been breached.

Compensatory damages are typically assessed against the breaching party:

86. _____ An expression of opinion is not a valid offer.

87. _____ When a contractor submits a bid for a construction project, the submission of the bid is an offer.

38. _____ Wendy offers to pay Jose $1,000 if he agrees to promise to paint her house this month. If Jose accepts the offer, it will create a unilateral, executed contract.

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: a. win because Ryan was the seller. b. win because minors can only avoid contracts for the sale of land. c. lose, as the contract is void. d. lose, because the contract is voidable by Ryan.

D lose, because the contract is voidable by Ryan

For statute of frauds purposes, an interest in land includes:

D. All of the above A. A house B. A real estate mortgage C. An easement

Which of the following promises ordinarily must be in writing to be enforceable?

D. All of the above A. Promises made as a part of a prenuptial agreement. B. The agreement to sell a car for $1500. C. The promise by an executor of an estate to pay a debt of the decedent.

Which of the following would suffice for a signature on a writing under the statute of frauds?

D. Any of the above would suffice. Judges define "signature" very broadly. A. A stamped signature. B. A retinal scan. C. A name keyed at the bottom of an e-mail

The most accurate statement regarding economic duress is:

D. It may be grounds for rescission

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.

D. None of the above; the contract duties are discharged

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:

D. Not obligated to pay under the frustration of purpose doctrine

Oxtron, Inc. substantially performed its obligations under a service contract. Oxtron is entitled to receive:

D. The full contract price minus the value of the defects

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?

D. 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?

D. 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

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.

39. _____ A contract to provide lawn and landscaping service for "the next six (6) months" falls within the scope of the statute of frauds, and must be in writing to be enforceable.

42. _____ Sue leases her 3 Bedroom, 2-bath home to Trisha for $300,000 for one year. The parties sign a written lease. Article 2-A of the UCC governs this contract.

Usage of trade is any practice that members of an industry expect to be part of their dealings. Course of dealing refers to previous commercial transactions between the same two parties. Course of performance refers to the history of dealings between the parties in the same contract and thus assumes that it is the kind of contract demanding an on-going relationship. These terms present three circumstances where the tender may not be perfect in a strict sense. In other words, the buyer may not be able to reject minor flaws if the tender is perfect according to industry standards, or prior contracts between the same parties, or based on a history of dealings between the parties in the same contract.

Define these terms: usage of trade; course of dealing; and course of performance.

Derek will win because the writing is sufficient under the statute of frauds.

under any circumstances.

Dick steals Jane's camcorder and sells it to Sid. Jane can recover the camcorder from Sid

The statement must first be a fact, not an opinion. "This car is the best" would not be the type of statement that should be relied upon. Contrast that type of statement with, "this car gets 28 miles per gallon." This is a statement of fact upon which someone would rely. The statement must also be material, that is important in the decision to enter into the contract. For the fact to be material, the maker must have expected the other party to rely on the statement, and the other party must have relied upon it

Discuss the concept of a "material fact" in fraud situations.

Mark's home had burned to the ground. When he met with his insurance adjuster, she accused him of burning down the house, and she said she would have him criminally prosecuted if he did't settle the claim for much less than the house was worth. Mark agreed to the settlement If he changed his mid, he can probably rescind the settlement on the basis of: A fraud B duress C undue influence D mistake

Duress

A person who makes a contractual offer is referred to as an "offeree."

False

1. _____ The offeror is the party with the power to decide whether to create a contract.

11. _____ A parent or parents who sign a contract on behalf of their minor child may disaffirm the contract just as their child may.

12. _____ A party who makes a mistake about the value of the object of a contract is normally permitted to avoid the contract.

14. _____ A party to a contract may delegate his rights arising from the contract to another person.

16. _____ Expenses, such as those incurred to obtain performance from a source other than the original contracting party, are called consequential damages.

18. _____ An incidental beneficiary can directly sue the maker of a contract in the case of breach.

26. _____ Generally, an offer is effective as soon as it is dispatched.

28. _____ If Bill tells Sara that he will give her two days to decide if she wants to buy his car, he cannot sell it to anyone else during that time.

A person who makes a contractual promise is referred to as a "promisee."

False

43. _____ Bob, a schoolteacher, sells his neighbor Sam an old office chair at a garage sale. Bob has given Sam an "implied warranty of merchantability."

44. _____ Sue sells her 3 bedroom, 2 bath home to Trisha for $300,000. The parties sign a written contract. Article 2 of the UCC governs this contract.

45. _____ A contract for lawn mowing services falls under the scope of Article 2 of the UCC.

46. _____ For Article 2 of the UCC to apply, at least one party to the contract must be a merchant.

47. _____ Pat, who owns an appliance store, has a garage sale at his home where he sells old furniture and books. He sells a set of books to his neighbor Judy. Pat is considered a merchant under Article 2 of the UCC in selling the books to Judy.

5. _____ A counteroffer is treated as both a revocation and a new offer.

50. _____ A void contract is a contract that one or both parties may cancel, at their option.

52. _____ An express contract is a contract that is evidenced by a writing.

53. _____ A revocation normally is effective at the time it is dispatched by the offeror.

54. _____ A rejection normally is effective at the time it is dispatched by the offeree.

55. _____ The offeror's death automatically terminates an offer, but the offeree's death does not.

57. _____ An assignee must give consideration to the assignor in exchange for the assignment.

59. _____ Under the "American Rule" governing successive assignments, the first assignee in time has the superior right.

60. _____ Rolland just bought a new pair of eye glasses. He had to go to the eye doctor for an exam and to get a prescription. He then took the prescription to the eye-glass store to by his new glasses. Rolland's visit to the eye doctor is governed by the UCC; the purchase of his glasses from the eye-glasses store is not.

61. _____ The mirror image rule permits the offeree's acceptance of a contract to materially differ from the offer.

62. _____ A counter-offer will generally be treated as an implied revocation, and a new offer.

63. _____ If a rejection is placed in the mail, with the proper address and postage, it will generally be considered effective on "deposit."

66. _____ Advertisements are typically considered valid offers.

69. _____ Robert agrees to buy a car from Jane for $400. This contract must be in writing to be enforceable.

70. _____ "I'll pay you $1,000 if you promise to paint my house this month." If the offeree accepts, this is a unilateral contract.

71. _____ A person who makes a contractual offer is referred to as an "offeree."

72. _____ A person who makes a contractual promise is referred to as a "promisee."

73. _____ All promises are enforceable as contracts.

76. _____ Mary was mistaken about a material fact concerning a contract she made with Bob. Mary can avoid the contract on the grounds of "fraud."

78. _____ A party can always avoid a contract on the basis of a unilateral mistake of value.

8. _____ The mirror image rule permits the offeree's acceptance of a contract to vary from the offer.

80. _____ An offeror's subjective beliefs or assumptions determine his or her intent to contract.

82. _____ An offer does not need to be communicated to the offeree to be effective.

84. _____ Any agreement made "after a few drinks" can be avoided for lack of seriousness of intent.

85. _____ A price list is considered an offer.

89. _____ An "express" contract must be in writing.

9. _____ A person who delegates his contractual duties is fully relieved of any further duty to perform under that contract.

91. _____ If an offeree makes a counteroffer, he becomes the "counter-offeror."

92. _____ The UCC applies to contracts for services as well as to contracts for the sale of goods.

93. _____ Under the UCC, the mirror image rule applies in the same manner as under common law.

95. _____ Implied warranties of merchantability can never be disclaimed.

97. _____ A statement that a particular truck can haul a 3,000 pound load would be treated as an opinion and would not become an express warranty.

A completed act can be the basis for consideration

A gambling contract is legal unless it is specifically prohibited by state statute.

A letter of intent summarizes progress made during business negotiations, but more importantly, it creates a binding contract.

A party may make either an assignment or a delegation, but cannot make both an assignment and a delegation simultaneously.

A party to a contract has a duty to investigate the other party's factual statements

A valid contract can legally be voided by either party

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.

According to section 2-302 of the UCC, if a court finds as a matter of law that a clause of a contract was unconscionable at the time the contract was made, the court must refuse to enforce the contract.

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.

All oral contracts are quasi-contracts until they are completely executed.

Ambiguities in contracts are always interpreted in favor of the side that wrote the contract, since they are the ones who know what the provision is supposed to mean.

An illusory promise is a valid consideration

April put an advertisement in the newspaper advertising the sale of her computer for $500. Simultaneously, six people responded to the ad by mail with formal written acceptances. April is bound on all six contracts to sell her computer for $500.

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 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 a material breach of the contract.

Barbara, a skilled welder, was hired at Mainco Enterprises for a welding position. She was asked to sign a noncompete clause limiting future employment if she left Mainco. A court would be very likely to enforce the noncompete clause unless the time or geographic restriction is unreasonable.

Billy owes a liquidated debt of $3000 to Rayna, his personal weight trainer. Billy sends Rayna a check for $300 on which he has marked, "Payment in Full." If Rayna cashes the check she will not be able to successfully sue Billy for the remainder of the debt

Candy, Inc. signed an agreement with Sweet Plantation. Under the contract, Candy Inc. agreed to purchase all the sugar cane Sweet Plantation grew during the season. This contract will be unenforceable due to its vagueness.

Char-glo industries contracted with Evergreen Lawn Service to mow and trim the company's lawn. In the contract, Char-glo included a clause prohibiting Evergreen from delegating its duties. Courts will ordinarily not enforce such a clause

Claims for personal injury are generally assignable

Concurrent conditions arise when there is both a condition precedent and a condition subsequent.

Contract prohibitions against assignments are invalid as a matter of public policy

Contracts generally do not require bargaining that leads to an exchange between the parties.

Contracts in which one party agrees in good faith to buy all his requirements of certain goods from the other party are generally unenforceable because there is no definite amount.

Denton agreed to build a cedar deck for the Thrashers for $7,000. After he began the work, the Thrashers asked him to add cedar flower boxes on one side. Denton replied he would, but it would cost an additional $600. The Thrashers would not be obligated to pay the additional sum because the original agreement already obligated Denton to complete the deck for $7,000.

Dr. Gonzalez ordered specialized surgical equipment from Physician's Supply Co., but the company informed Dr. Gonzalez that it would not be able to meet his order by the agreed date. Even if Dr. Gonzalez does nothing to secure equipment from another source, he will be able to recover damages since the contract was breached by Physician's Supply, not Gonzalez.

Either party may demand remission of a fully executed oral contract if it was required to have been in writing under the statute of frauds.

Emily runs a children's clothing boutique which takes in local homemade items on a consignment basis. Her standard form contract indicates that Emily has the right to put items on sale without prior approval, but does not specify what effect the sale has on the consignor's payment percentage. Her intent is to keep the same profit she would have had without the sale. She is using ambiguity in her contract to increase her sales and profit.

Expectation interest can best be described as money spent in reliance upon the agreement.

F discharged by mutual agreement of the parties.

First Bank has agreed to loan Teresa $10,000 for use in her cosmetics business. If Teresa sells the business to Melissa before the loan is disbursed, Teresa can assign her right to the loan to Melissa.

Fraudulent, but not innocent, misrepresentation permits the injured party to rescind a contract

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.

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.

If Valley Bridge contracts with Rainbow Painters to paint a bridge and the contract requires that only Sherwin Williams paint be used, then Sherwin Williams, as third party beneficiary will be able to enforce the contract against either Valley Bridge or Rainbow Printers.

A price list is considered an offer.

False

If a court finds as a matter of law that a clause of a contract was unconscionable at the time the contract was made, the court must refuse to enforce the contract

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.

If you have an established relationship with a buyer, you can sell small tracts of land without a written contract.

In negotiating the purchase of a vehicle, the sales representative told Karla, "I guarantee that you will be personally sastified 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 judgement must be reasonable.

Injunctions are frequently used by courts to force employees to complete their contractual obligations with their employers.

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.

It is unethical to use your lawyer as an excuse for a provision of a contract, such as, "My lawyer insists that I have a liquidated damages clause..."

John was a licensed physician in Michigan. When he retired to Florida, he started providing medical services to the people in his condo, relying on his Michigan license. Isaac, John's next door neighbor, owed John $2000 for medical services. John will be able to enforce the contract he made with Isaac.

Lawyers prefer to negotiate touchy subjects as they arise rather than address them at the beginning of a relationship.

Liquidated damages are awarded to parties who have experienced an injury to their legal rights but have no actual loss.

Lucy and Rick sign a contract in which Lucy agrees to deliver 10 boxes of chocolates in exchange for Rick's promise to pay $5 per box. Lucy delivers the candy. Rick pays for the goods. This contract is fully executory.

Norm and Frank have a legal contract that is silent with regard to an assignment of the contract. In order for Norm to assign all or part of his rights under a contract, Frank must grant such permission to Norm.

On Monday, Mick puts an offer in the mail to Sheri to sell his guitar for $50. Monday night when jamming with his buddies, he decides he will really miss his old guitar and has second thoughts about selling it. Tuesday morning he puts a revocation in the mail informing Sheri he has changed his mind and the guitar is no longer for sale. The revocation is effective on Tuesday morning.

Paid surrogacy contracts are viewed by the legislative majority in all states as immoral and illegal.

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.

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.

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

Rudolph overhears Macy's plans to go skydiving over spring break. Not really knowing Macy, but figuring it's worth a chance, Rudolph rushes out and buys an insurance policy for $100,000 on Macy's life. Macy does in fact meet her demise jumping out of the airplane. Rudolph can collect the $100,000.

Section 2-306 of the UCC expressly disallows output contracts in the sale of goods

Strawly Corp. runs an "adult bookstore" in Metro City, leasing the building from MegaCorp. Then, Metro City passes an ordinance prohibiting the sales of the types of merchandise found in "adult bookstores." Strawly is still bound by the contract

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.

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.

The UCC requires consideration for agreements modifying contracts for the sale of goods.

The element of a contract that states the parties must be adults of sound mind is consent

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."

The two basic elements of consideration are intention and agreement.

To raise revenues, the City of St. Cloud required restaurants to purchase a special permit if they wanted to serve food on an open-air patio, in addition to the sanitation license. While at Hola Taco, a restaurant in St. Cloud, a customer notices that Hola Taco's permit expired. This means the customer is not legally required to pay for her food.

A quasi contract is another name for an oral contract.

False

Upon the recommendation of a friend, Hope hires Joey to rewire her kitchen and he completes the work within the time agreed. Then Hope finds out that Joey is not a licensed electrician, and she refuses to pay him for the work. A court will enforce the agreement because otherwise Hope will be unjustly enriched.

Vick Valve Company makes valves for plumbing fixtures. At the beginning of the year, it sends out a price list addressing each one, "To our valued customers." Honest Hank Hardware orders a variety of valves at the prices quoted on the price list. Vick Valve must honor the prices on the list and sell the valves to Honest Hank.

When Olga asks Sven if he wishes to sell his Harley motorcycle, he replies that he would not sell it "for less than $2,000." Olga replies, "I accept," and hands him $2,000. A contract exists.

When Randy, an electrician, accepted a job with Buren Construction, Randy signed the following agreement, "Upon termination of my employment with Buren Construction, I agree never to work for another employer as an electrician." If Randy resigns from Buren Construction, this agreement would be upheld under the theory of freedom of contract.

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 "writing" "signed by the party against whom enforcement is sought" if he follows up with a signature on paper.

You should hire a lawyer to review any legal papers you have to sign, especially such papers as lease agreements or car purchases.

A party to a contract has a duty to investigate the other party's factual statements.

FALSE

A valid contract can legally be voided by either party.

FALSE

Candy, Inc. signed an agreement with Sweet Plantation. Under the contract, Candy, Inc. agreed to purchase all the sugar cane Sweet Plantation grew during the coming season. This contract will be unenforceable due to its vagueness.

FALSE

Contracts generally do not require bargaining that leads to an exchange between the parties.

FALSE

Contracts in which one party agrees to buy all his requirements of certain goods from the other party are generally unenforceable because there is no definite amount.

FALSE

Courts normally require adequate consideration.

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 that was required to have been in writing under the statute of frauds.

FALSE

Fraudulent, but not innocent, misrepresentation permits the injured party to rescind a contract.

FALSE

If a court finds as a matter of law that a clause of Superior Siding's contract was unconscionable at the time the contract was made, the court must refuse to enforce the contract.

FALSE

If both parties believe they have a binding contract, this belief is controlling if there is later a question about the validity and enforceability of the agreement.

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 commonly 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 powerful computer for his home "on the condition of personal satisfaction." If Irving takes the computer back to the store for no reason other than that he doesn't like the computer, then the seller will have no choice but to accept 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

Megan agrees to sell Neff her quartz watch but they do not specify a price. In such a case, the court would not enforce the agreement because all of the essential terms are not present.

FALSE

Morality plays no part of gambling contract legality.

FALSE

Most contracts are discharged by mutual agreement.

FALSE

Nella offers to sell her crop of strawberries, which have just been picked, to Morgan's Market. Since she does not specify a time limit for acceptance, Morgan's can accept the offer the following week, as long as Nella has not revoked it.

FALSE

A rejection normally is effective at the time it is dispatched by the offeree.

False

On Monday, Harry puts an offer in the mail to Sally to sell his guitar for $50. Monday night when jamming with his buddies, he decides he will really miss his old guitar and has second thoughts about selling it. Tuesday morning he puts a revocation in the mail informing Sally he has changed his mind and the guitar is no longer for sale. The revocation is effective on Tuesday morning.

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, 2009." This writing is sufficient under the statute of frauds to make the contract enforceable.

FALSE

Pushy Pat, a persuasive salesman, talked Naive Nancy into purchasing something she didn't really need or want. Naive Nancy may rescind the contract because of undue influence.

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 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

Strawly Corp. wants to sell land which has toxic waste underground. It may shift all the responsibility for environmental cleanup to the buyer by including such a provision in the sales contract.

FALSE

The UCC does not apply to contracts for the sale of goods if the value of the goods is less than $500.

FALSE

The UCC requires consideration for agreements modifying contracts for the sale of goods.

FALSE

Valerie promises Teresa that she will pay Teresa $75 if Teresa will clean Valerie's house by noon on Saturday. If Teresa cleans the house by noon on Saturday and Valerie pays the $75, then this is an implied, bilateral, executory contract.

FALSE

Vern Valve Company makes valves for plumbing fixtures. At the beginning of the year, it sends out a price list addressing each one, "To our valued customers." Honest Hank Hardware orders a variety of valves at the prices quoted on the price list. Vern Valve must sell the valves to Honest Hank for the prices quoted on the list.

FALSE

When Olga asks Sven if he wishes to sell his Harley motorcycle, he replies that he would not sell it "for less than $2,000. "Olga replies, "I accept," and hands him $2,000. A contract exists.

FALSE

ny contract involving a sale of goods of $100 or more must be in writing.

FALSE

"I promise to pay you $100 if you will promise to fix my car next month." This is an offer for a unilateral contract

False

"I'll pay you $1,000 if you promise to paint my house this month." If the offeree accepts, this is a unilateral contract.

False

5. A counteroffer is treated as both a revocation and a new offer.

False

8. The mirror image rule permits the offeree's acceptance of a contract to vary from the offer.

False

A contract for lawn mowing services falls under the scope of Article 2 of the UCC.

False

A contract to provide lawn and landscaping service for "the next six (6) months" falls within the scope of the statute of frauds, and must be in writing to be enforceable.

False

A counter-offer will generally be treated as an implied revocation, and a new offer.

False

A parent or parents who sign a contract on behalf of their minor child may disaffirm the contract just as their child may.

False

A party can always avoid a contract on the basis of a unilateral mistake of value.

False

A party to a contract has a duty to investigate the other party's factual statements.

False

A party to a contract may delegate his rights arising from the contract to another person.

False

A party who makes a mistake about the value of the object of a contract is normally ermitted to avoid the contract.

False

A person who delegates his contractual duties is fully relieved of any further duty to perform under that contract.

False

All promises are enforceable as contracts.

False

An "express" contract must be in writing.

False

An assignee must give consideration to the assignor in exchange for the assignment.

False

An express contract is a contract that is evidenced by a writing.

False

An incidental beneficiary can directly sue the maker of a contract in the case of breach.

False

An offer can never be validly accepted by the offeree's silence

False

An offer does not need to be communicated to the offeree to be effective

False

An offeror's subjective beliefs or assumptions determine his or her intent to contract.

False

Any agreement made "after a few drinks" can be avoided for lack of seriousness of intent.

False

Bob, a schoolteacher, sells his neighbor Sam an old office chair at a garage sale. Bob has given Sam an "implied warranty of merchantability."

False

Concurrent conditions arise when there is both a condition precedent and a condition subsequent.

False

Either party may demand rescission of a fully executed oral contract that was required to have been in writing under the statute of frauds.

False

Expenses, such as those incurred to obtain performance from a source other than the original contracting party, are called consequential damages.

False

For Article 2 of the UCC to apply, at least one party to the contract must be a merchant.

False

Fraudulent, but not innocent, misrepresentation permits the injured party to rescind a contract.

False

Generally, an offer is effective as soon as it is dispatched

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

If Bill tells Sara that he will give her two days to decide if she wants to buy his car, he cannot sell it to anyone else during that time.

False

If a rejection is placed in the mail, with the proper address and postage, it will generally be considered effective on "deposit.

False

If a salesperson says, "This is a great car," but the car turns out to be a lemon, the salesperson has committed fraud.

False

If an offer states that it MUST be received by a certain date, receipt is presumed in those situations when acceptance is mailed.

False

If an offeree makes a counteroffer, he becomes the "counter-offeror."

False

If employees wish to organize a union, the employer is prohibited from distributing written notices to employees stating it is opposed to union activity within the company

False

Implied warranties of merchantability can never be disclaimed.

False

In contract law, a minor is someone under the age of 21.

False

Mary was mistaken about a material fact concerning a contract she made with Bob. Mary can avoid the contract on the grounds of "fraud."

False

Most contracts are discharged by mutual agreement of the parties.

False

Nathan promises to take Debra to the show on Friday night. He then changes his mind so that he can stay home and study his business law. Nathan can be sued for breach of contract by Debra for breaking his promise.

False

Parol evidence is never admissible.

False

Pat, who owns an appliance store, has a garage sale at his home where he sells old furniture and books. He sells a set of books to his neighbor Judy. Pat is considered a merchant under Article 2 of the UCC in selling the books to Judy.

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, 2009." This writing is sufficient under the statute of frauds to make the contract enforceable.

False

Ramona 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

Rolland just bought a new pair of eye glasses. He had to go to the eye doctor for an exam and to get a prescription. He then took the prescription to the eye-glass store to buy his new glasses. Rolland's visit to the eye doctor is governed by the UCC; the purchase of his glasses from the eye-glasses store is not.

False

Sue leases her 3 Bedroom, 2-bath home to Trisha for $300,000 for one year. The parties sign a written lease. Article 2-A of the UCC governs this contract.

False

Sue sells her 3 bedroom, 2 bath home to Trisha for $300,000. The parties sign a written contract. Article 2 of the UCC governs this contract.

False

T/F: 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

T/F:Any contract involving a sale of goods of $100 or more must be in writing.

False

The Employee Retirement Income Security Act (ERISA) requires employers to establish pension plans for employees.

False

The UCC applies to contracts for services as well as to contracts for the sale of goods.

False

The law enforces all promises, therefore, all promises are contracts

False

The mirror image rule permits the offeree's acceptance of a contract to materially differ from the offer.

False

The offeror is the party with the power to decide whether to create a contract.

False

The offeror's death automatically terminates an offer, but the offeree's death does not.

False

Under the "American Rule" governing successive assignments, the first assignee in time has the superior right.

False

Under the UCC, the mirror image rule applies in the same manner as under common law.

False

Wendy offers to pay Jose $1,000 if he agrees to promise to paint her house this month. If Jose accepts the offer, it will create a unilateral, executed contract.

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

Family Time may reject the non-conforming installment only if it substantially impairs the value of that installment and cannot be cured.

Family Time Restaurant has a contract with Prime Meats for Prime to deliver 100 pounds of ground sirloin twice a week for the next three months. If, on one delivery, Prime brings 95 pounds of ground chuck instead of 100 pounds of ground sirloin:

a reasonable mitigation of damages.

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:

When actual damages are difficult to determine.

Generally, reasonable liquidated damage clauses will be enforced:

Graham had voidable title and Harlow gets good title.

Graham, an adult, purchases a car from a minor, and subsequently sells it to Harlow, another adult. Harlow paid full value for the car and had no reason to know that Graham had purchased the car from a minor. Which of the following best describes this situation?

An express contract:

Has both parties setting forth their intentions.

88. _____ A "quasi-contract" is not really a contract.

If a buyer breaches a contract, the seller can always cancel the contract. The seller may be able to: stop delivery of the goods, identify goods to the contract (which will help it recover damages), rea-sonably resell the goods and recover the difference between the resale price and contract price plus incidental damages minus expenses saved, obtain damages for non-acceptance, or obtain the con-tract price.

Identify six possible remedies for a seller when the buyer breaches a contract.

Courts sometimes award punitive or exemplary damages in addition to compensatory damages. Compensatory damages redress the "loss the plaintiff has suffered by reason of the defendant's wrongful conduct." Punitive damages serve the dual purposes of deterrence and retribution, and are viewed as "quasi-criminal" and as "private fines"; the Supreme Court has defined their imposition as "an expression of the jury's moral condemnation."

Identify the considerations the United States Supreme Court outlined for calculating punitive damages.

puffery.

If Jane persuades Linda to buy her horse by telling Linda that the horse runs "like the wind," then Jane's statement is:

Bernie owes an undisputed amount to Wilde's Heating & Air Conditioning. Which of the following is true?

If Wilde's agrees to accept less than the full amount as full payment, the agreement is not binding.

All of the above

If a buyer does not receive goods by the contract deadline, remedies available include:

one party will probably be discharged without performing.

If a condition does not occur:

award a very small amount of money

If a court awards nominal damages it will generally:

is discharged from any further obligations under the 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:

Kaboom's actions amount to an anticipatory breach. It has clearly indicated it does not intend to per-form the contract. All Seasons does not need to wait until June 1 before buying the supplies from an-other source. Kaboom is responsible for the breach just as if it had breached on June 1

In January, All Seasons, Inc. ordered $4000 of fireworks from Kaboom Ltd. with delivery to be on or before June 1. On April 15, Kaboom notifies All Seasons that it will not be able to perform the contract as agreed. How will the law characterize Kaboom's actions? Does All Seasons have to wait until June 1 before buying fireworks from another supplier?

This type of clause is known as a liquidated damages clause. Generally this type of clause will be en-forced if, at the time of creating the contract, it was very difficult to estimate actual damages, and theliquidated amount is reasonable. In this case, if the total construction contract involved millions of dol-lars, the estimate of damages may reasonably amount to a $1000 per day. If the construction project isa small one, the court may see this amount as too much and not enforce the clause.

In a construction contract, there is a $1000 per day estimate of damages for each day that the contract runs over the completion date. The contractor is 30 days late when the job is completed, resulting in a prospective damage award of $30,000. What is this type of clause, and when will it be enforced?

be signed by the defendant and contain the name of each party, the subject matter of the agreement, and the essential terms and promises

In order to satisfy the statute of frauds, a writing must:

Inez will lose under both implied warranties.The implied warranty of merchantability was not breachedbecause the furnace was operating according the standards of the heating industry.The implied warranty offitness was likewise not breached.This warranty requires the seller to know of the buyer's particularpurpose and that the buyer is relying on the seller's skill or judgment in recommending a particular product.Here Inez did not ask for or receive any suggestions from the seller or the seller's expert

Inez contracted with Filippo Furnaces Co. for the installation of a new furnace. Inez selected the furnace she wanted, accepting no suggestions from Filippo Furnaces' heating engineer. The furnace operated fine, but it did not heat the entire house. The size of the blower on the furnace was too small to accommodate the third floor of the house. Inez sued Filippo Furnaces Co. for the breach of the implied warranties of merchantability and fitness. What result?

Cattle are goods. The statute of frauds requires all contracts involving the sale of goods with a pur-chase price of $500 or more to be in writing with the defendant's signature. Here the purchase price is$50,000, so the agreement falls within the statute of frauds and is unenforceable unless one of the ex-ceptions applies. A relevant exception for Tidwell is the "Goods delivered or paid for" exception. AsTidwell paid $1000 towards the purchase price he is entitled to two head of cattle.

J.T. Tidwell entered into an oral contract with Robert Anthony for the purchase of 100 head of cattle at a price of $500 each. When the oral contract was made, Tidwell gave Anthony a check for $1000 as "earnest money or good faith money towards the purchase of the cattle." Anthony sold the cattle to someone else. Tidwell sued, asking the court to either compel Anthony to perform the contract or to pay damages that Tidwell suffered from the alleged breach of contract. What issues do you see and how would you resolve those issues?

is required to pay the full contract price, minus the value of Jennifer's defective performance.

Jennifer substantially performs her service contract with Gretchen. Due to Jennifer's failure to render complete performance, Gretchen:

Jack mails an offer to Joan that states, "I offer to sell you my car for $2000. If I don't hear from you in 10 days, I will assume you are willing to buy the car for the stated price." Jack hears nothing by the deadline and assumes he has a deal. What is the result?

Joan is not bound. Generally an offeree must say or do something to accept an offer.

Article 2 governs contracts for the sale of goods. When there is a "mixed" contract, one involving both goods and services, such as the one between Jones and Martin, the courts will look to what is the predominant purpose of the contract. Here, although Jones may have agreed to purchase Mar-tin's computer because of the services Martin was willing to provide, the overriding purpose of the contract was to obtain a computer. In other words, the services without the computer are meaning-less. Therefore, the UCC rather than the common law governs.

Jones contracts to buy a computer from Martin for $1500. The contract calls for Martin to service the computer quarterly for the first year and to tutor Jones on how to use the software. Is this contract covered by the UCC or common law?

To be valid, an agreement not to compete must be ancillary to a legitimate bargain.

When there is a unilateral mistake, generally the court will not allow the injured party to rescind thecontract unless enforcing the contract would be unconscionable or the non-mistaken party knew of theerror. Here the court found that the mistake was a mutual mistake because both parties were under theassumption that the roof did not leak. Larson was mistaken because he had previously repaired the roofand expected those repairs to last. Bill was mistaken due to the representations made by Larson. Billrelied on the representations of a friend. When he saw the crack, he did investigate by asking Larsonabout the condition of the crack. It was reasonable to rely on the representations of Larson under thecircumstance. Where there is a mutual mistake of material fact the contract is voidable by the injuredparty. The court ordered Larson to return the earnest money paid plus interest, thereby rescinding thecontract.

Larson put his home on the market for sale. His good friend Bill came to look at the home for possible purchase or rental. Bill noticed a crack in the ceiling and inquired about it to Larson. Larson said that there had been a water leakage problem in the area but it had been fixed two years ago and had not leaked since. Bill made a written offer on the house which was accepted in writing by Larson the next day. On the day prior to closing, Bill went to make a final inspection. Bill observed water leaking through another crack in a ceiling of the house and in the garage. The next day, Bill informed the real estate agent that he was rescinding the contract because of the leaks. Larson subsequently rented the property to another party. A couple of months later, Larson filed a suit seeking a court order to make Bill purchase the house or in the alternative for money damages. Bill defended by claiming that Larson either defrauded him or there was a mutual mistake and asked for the return of his earnest money and/or damages for fraud. The trial court found there was no evidence to find fraud on the part of Larson because the roof had been previously fixed and the two parties had been good friends. What is the appropriate remedy when a court concludes that there has been a mutual mistake of material fact?

are enacted by state legislatures.

Lemon laws, which assist consumers who have purchased automobiles that turn out to be "lemons,":

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.

Kurtz will not be liable for the purchase price. The risk of loss had not yet transferred since the goods were nonconforming.

Marco Manufacturing contracted to sell Kurtz Industries 3,000 iron clasps. The contract specified: F.O.B. Kurtz Industries. Upon arrival and inspection, the goods were rejected by Kurtz Industries because they did not conform to the contract specifications. In transit back to Marco Manufacturing, the common carrier's truck overturned and completely destroyed the clasps. Which statement is correct?

No, to satisfy the statute of frauds, the memorandum must contain all essential terms of the contract.

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?

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 two years later and Marty has not disaffirmed the contract and has made 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.

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?

Collector Carl displays his beer can collection at the local swap meet. Mary sees the collection and is interested in buying it. Carl says he will sell the collection for $1,500. Mary says she really likes the collection but is only willing to pay $1,000. Which of the following is correct?

Mary's counteroffer terminates Carl's offer of $1,500.

the full contract price minus the value of the defects.

Oxtron, Inc. substantially performed its obligations under a service contract. Oxtron is entitled to receive:

As English judges were developing the common law of contracts in the twelfth and thirteenth centuries:

Promises were found not binding unless written and sealed.

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.

subject to the claims of Mayco's creditors under Section 2-326 of the Uniform Commercial Code.

Mayco has received goods from Wallace pursuant to a sale or return agreement. If Mayco subsequently declares bankruptcy, the goods will be:

Employees of Mega Corp. have gone out on strike seeking better pay. Mega Corp. announces that if the union does not end the strike it will begin hiring replacement workers. Which statement is correct?

Mega Corp can hire replacement workers at any time during a strike.

Braybon should accept them because Meister Bros. has a right to cure even after the contract deadline under these circumstances.

Meister Bros. shipped 250 radiator belts to fill Braybon's order. Quality control measures had been in place in Meister's factory when the belts were manufactured. When Braybon received the order one day before it was due, it notified Meister that it rejected the belts because of a variation from the contract specifications. Meister, although it believed the original belts met the contract specifications, notified Braybon that it would supply conforming goods within one week. When the conforming goods arrive in one week:

normally void the contract but will require Sasha to return the piano.

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:

cannot recover its expectation interest because there was no enforceable agreement.

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:

Beth because Mike was ready, willing, and able to tender the car at 12:00 noon.

Mike sold his car to Beth, who was to pick the car up at Mike's house by 12:00 noon on September 1. Mike was at his house waiting for Beth but she was late. In fact, when Beth arrived she discovered Mike's home and the car destroyed by a fire that started at 1:00 p.m. The risk of loss falls on:

Which of the following are generally considered to be legal offers?

NONE

Ned has breached the warranty of title.

Ned sold his refrigerator to his next door neighbor, Ian. Ned fails to tell Ian he has not finished paying for the refrigerator and Neighborhood Bank has a lien on it.

have a contract and, in the majority of states, the different terms will cancel each other out.

Newt, a gun dealer, offers to sell a rare civil war musket to Rush, another dealer, for "$15,000, insurance and shipping paid by buyer." Rush responds, "I accept. Insurance and shipping costs divided equally between seller and buyer." The parties:

On January 16, Deb offers to sell her waterbed to Colleen for $600. Colleen accepts and agrees to pay Deb $600 on January 27. Which of the following is correct?

On January 16, the contract was executory.

Patty is a poor college student struggling to work and keep up with her studies. Fred, her uncle, promises to pay Patty support of $200 per month for the next six months. Although Fred didn't ask her to, she quits her current job in order to devote full time to her studies for the next six months. Fred makes one payment and then stops with no explanation. If Patty sues, what is the likely result?

Patty may win under the doctrine of promissory estoppel.

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

uncommon.

Reformation is:

object to the confirmation in writing within 10 days.

Renita, a merchant, has received a signed, written confirmation from Merchants, Inc. referring to goods she had not ordered. Renita should:

enforceable even without Robin's signature because both parties are merchants.

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:

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 necessary.

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:

The legal right to sue for a breach of contract is subject to a statute of limitations.

True

can sue Sea Rovers immediately for breach of contract.

To win expectation damages, the injured party must prove the breach of contract caused damages that can be quantified with reasonable certainty.

Which of the following is an example of an exculpatory clause?

Seller is not responsible for property damage regardless of the cause of the injury.

Which of the following is most likely to consitute fraud?

Silence as to a toxic waste problem on real property that the buyer would not reasonably find.

the difference between Solomon's contract price and the amount paid by Renny.

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:

If the supplier will not provide paint that matches the sample in quality, Sonny can sue the supplier forbreach of an express warranty.The UCC establishes that the seller may create an express warranty in threeways: with an affirmation of fact or a promise, with a description of the goods, or with a sample or model.A seller who uses a sample is generally warranting that the merchandise sold will be just as good.Sonnymust demonstrate that the sample provided was the basis of the bargain

Sonny had a contract to paint the rides at an amusement park and needed a paint that would protect against extensive wear, potentially harsh weather, and rust. Sonny asked for paint samples from several companies, and selected one supplier based on the quality of the sample. When he received his order, he found that the quality did not match that of the sample. What recourse does Sonny have?

limit the time in which an injured party may sue.

Statutes of limitations

58. _____ In general, ambiguities in a written agreement are resolved against the party who drafted the agreement.

6. _____ Consideration can consist of giving up a legal right.

64. _____ One of the key issues in a promissory estoppel case is whether the defendant made a promise to the plaintiff that the plaintiff detrimentally relied upon.

65. _____ In order for an offer to be legally valid under the common law, it must have reasonably definite terms.

67. _____ One purpose of contract law is to make business matters more predictable.

74. _____ Advertisements are generally not considered as offers to enter into a contract.

75. _____ Under the common law, an offeree's proposal to make a material change in the terms of an offer will most likely constitute a counter-offer.

77. _____ Under the "mailbox rule," some acceptances are deemed effective upon dispatch.

10. _____ When both parties to a contract are minors, either or both of them may avoid the contract.

100. _____ An implied warranty of merchantability arises in every sale or lease by a merchant.

13. _____ A plaintiff must prove that he suffered actual injury to recover damages for fraud.

15. _____ The nonbreaching party normally may not recover punitive damages in a breach of contract claim.

17. _____ An express contract may be either written or oral.

19. _____ The mirror image rule requires that the acceptance exactly match the offer.

2. _____ An offer made as a joke, where a reasonable person would conclude that it was made as a joke, cannot result in a contract.

20. _____ Giving up a legal right to do something is enough to legally qualify as consideration.

23. _____ If a person who has been declared incompetent by a court enters into an agreement, that agreement is void, because it does not meet all the requirements of a binding contract.

24. _____ Alice makes a material misrepresentation of fact to Betty, and based upon the misrepresentation, Betty enters into a contract. Betty now realizes she was deceived and wants to get out of the contract. This contract is voidable at Betty's option only.

27. _____ An offer must be communicated to the offeree or his agent in order for the offer to be effective.

29. _____ Generally, a contract exists when an offer has been accepted.

3. _____ The communication of an offer can be made by the offeror or the offeror's agent.

30. _____ If the offer specifies it MUST be accepted by letter, a telegram will not be a valid means of acceptance.

32. _____ The party to whom an offer is made is an offeree.

33. _____ A counteroffer operates as a rejection of the original offer.

34. _____ Contracts have a number of legally essential elements, among which are an agreement and consideration.

36. _____ On July 12th, 2008, Louis offers to employ Teresa as head chef in his restaurant next year. The very next day, Teresa accepts the offer. The parties agree on a term of nine (9) months, and a $10,000 salary per month. Per their agreement, Teresa is to begin work on January 1. This contract falls within the scope of the statute of frauds, and thus will likely have to be in writing to be enforceable.

4. _____ Generally, advertisements, catalogs, price lists, etc. are not treated as offers.

40. _____ Fred offers to paint Debbie's home for $500. Debbie tells Fred she will only pay $450, and Fred agrees. Under these facts, Debbie is the "offeror."

41. _____ Sarah, an artist, e-mails Patricia and offers to paint her portrait for $499.99. Patricia calls Sarah back and accepts the offer. Sarah promises to paint the portrait within one (1) year, if not sooner, and Patricia agrees to pay within six (6) months of the portrait's receipt. This is an enforceable, bilateral, executory contract.

48. _____ The UCC imposes a duty of good faith on the performance and enforcement of every contract it covers.

51. _____ A promises to pay B $50 if B will mow A's lawn. B completely and satisfactorily mows A's lawn. This is a unilateral contract.

56. _____ An advertisement offering a reward for the return of lost property usually is treated as an offer for a uilateral contract.

94. _____ In ordinary sales transactions, the implied warranty of fitness for a particular purpose can be disclaimed, but the disclaimer must be in writing and conspicuous.

99. _____ For the implied warranty of fitness for a particular purpose to apply, the seller must have actually known the purpose for which the buyer was purchasing the goods.

A court may, at times, discharge a party who has not performed.

A debt that is disputed because the parties disagree over its existence or amount is an unliquidated debt.

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.

According to the UCC, one or more open terms will not cause a sales contract to fail for indefiniteness as long as the parties intended to make a contract and there is a reasonably certain basis for the court to determine the open terms.

After her 18th birthday Lora may, by words or action, ratify a contract she made during the previous year.

Agreeing not to open a competing business could be consideration.

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.

All states allow the remedy of rescinding a contract for the sale of goods while still allowing the remedy of suing for damages

Amanda buys a vacuum cleaner to use in her home from Andy. Amanda promises to pay for it in six monthly installments of $50 each. Andy assigns the contract to Big Finance Co. who paid value and took without notice of any defense. Amanda has stopped making payments because the vacuum stopped working and Andy refuses to honor the express warranty he made to her at the time of the sale. Big Finance Co. sues Amanda for nonpayment. Generally, any defense that Amanda may have against Andy is good against Big Finance Co.

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.

An employment contract is an example of a personal satisfaction contract.

Any ambiguity in a contract is interpreted against the party who drafted the contract.

Boris sky dives out of a plane and gets hung up in a tree, hopelessly suspended and swinging precariously in his parachute from the branches of the tree. Natasha sees that he is in trouble and comes to his rescue. Once Boris is safely on the ground, he gratefully promises to give Natasha half of his life savings. When he changes his mind, Natasha will probably be unsuccessful in enforcing his promise.

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 an oral agreement.

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.

Consideration can be a promise or an act

Contract rescission can sometimes be based upon a unilateral mistake

Contracts for the sale of fabric, automobiles, computers, furniture, and paper clips would all be governed by Article 2 of the Uniform Commercial Code.

Courts distinguish between mere gifts between parties and legally binding commitments by the element of consideration.

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.

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.

Generally, the assignment of the obligation to perform personal services is valid, as long as the services are equivalent in value

Hilda owes Lex $3000 which is an undisputed amount. If she offers him her car in full settlement of the debt and he accepts, the agreement is binding and he can no longer claim she owes him anything on the original debt

If Casey assigns her rights to receive income from rental property to Errol, then Errol will legally acquire any rights to the income previously held by Casey.

If Velma, as a birthday present, assigns to Jim her contractural right to collect $50 from Wood Co., this would be a gratuitous assignment.

If a contract is made with a person required by law to hold a license, and the purpose of the license is protection of the public, the contract made by an unlicensed person will generally be unenforceable.

If a minor can cancel a contract, it can be done at any time before the minor reaches the age of majority or within a reasonable time after reaching majority age.

In an option contract, the offeror may not revoke an offer during the option period.

In many states it is illegal to lend money to help someone gamble.

In seeking to determine whether there is a meeting of the minds, the courts look to how a reasonable person would objectively view the language or actions of the parties.

In the case of a typo, a court will reform a contract if there is clear and convincing evidence that the alleged mistake does not actually reflect the true intent of the parties.

L & M loaned Joan $400 so that she could buy her textbooks for the current semester. L & M's terms for repayment of the loan (including interest) are $200 in two months, $200 in four months, and another $100 at the end of the fifth month. The legal maximum rate of interest on this type of loan is six percent per annum. L & M's loan is usurious.

Mary goes into Honest Harry's Electronics and purchases a TV. Mary agrees to pay for the TV in 30 days on the store's "30 days same as cash" plan. This is an executory contract.

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.

Most types of duties may be delegated

Most, but not all, contract rights are assignable.

Mrs. Elsley was an elderly woman who relied on Nancy to visit her every day and prepare her meals. Nancy convinced Mrs. Elsley that she should give Nancy her house so they could live together and Nancy could better care for her, although Nancy really just wanted the house and had no intention of moving in to take care of Mrs. Elsley. Although Mrs. Elsley agreed, she may rescind the contract because of undue influence.

Nunnsky's Retail sent out newspaper inserts advertising wool suits for $50. In fact, the store had only two, out-of-style suits for sale at this price. Their other wool suits started at $175. This constitutes bad faith in its advertising, so consumers may have protection through state consumer protection statutes.

One purpose of contract law is to determine which agreements are worthy of legal enforcement.

One purpose of contract law is to make business matters more predictable

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.

Pastor Tom was employed by the First Church for 40 years. On Pastor Tom's retirement there was no adequate pension plan. Two months after the retirement, a wealthy parishioner, in consideration for Pastor Tom's 40 years of faithful service and being such a "sweet" man, promised to pay him $500 per month for the rest of his life. This promise probably is not enforceable.

Raul agrees to paint Mike's house for $1000. Before finishing, Raul states it is too hot to finish, and Mike offers to pay $1,200 if Raul finishes. Mike's statement that he will pay $1,200 is unenforceable

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.

Regarding contracts, in seeking to determine whether there is a meeting of the minds, the courts look to how a reasonable person would objectively view the language or actions of the parties.

Rest Well Hotel orally ordered 1,000 blankets monogrammed with its initials from TriColor Textiles. TriColor had just finished monograming the blankets when Rest Well called and cancelled the order. TriCOlor will be able to enforce the agreement even though there was no writing.

Revocation is the withdrawal of an offer by the offeror.

Robert offers to buy a car from Jane for $400. Jane must accept this offer in order to form an enforceable contract.

Roger parked his car at a garage that has a large sign at the entrance saying, "This garage is not liable for items stolen from a car." This type of notice is referred to as an exculpatory clause.

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. Roger may rescind the contract, return the stereo and get his money back.

Software clickwrap and shrinkwrap agreements limiting the manufacturer's maximum responsibility to a refund of the purchase price even if the software destroys your hard drive have generally been found to be binding against consumers.

Some contract parties are intentionally vague in contract terms

Some of the elements of a contract are acceptance, consideration, legality, and capacity.

Spencer, age 18 and of sound mind, has the legal capacity to contract.

The UCC recognizes commercial impracticalilty as a ground for discharge of a contract.

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.

The legal right to sue for a breach of contract is subject to a statute of limitations.

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.

Under a contract, Danielle is required to paint a room with paint chosen by the homeowners, the Flynns. After Danielle paints the room according to the contract requirements, her duties under the contract are discharged.

When a licensing requirement is designed merely to raise revenue, a contract made by an unlicensed person is generally enforceable.

When promissory estoppel is used by the courts, it is because there is NOT an enforceable contract present.

You have placed an antique sofa up for auction and the auctioneer has not made any special announcements about the sale. You can withdraw the sofa at any time before the auctioneer closes the sale by announcement or by the fall of the hammer.

TRUE

Alex promises to pay $100 to anyone who finds his lost watch. Kate finds and returns the watch to Alex after hearing of the reward money. Alex and Kate have an enforceable unilateral contract.

TRUE

An agreement may violate public policy even if the agreement does not require a party to commit a crime, tort, or violate a statute.

TRUE

An illusory promise is not consideration.

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

Contract rescission can sometimes be based upon a unilateral mistake.

TRUE

Contracts for the sale of fabric, automobiles, computers, furniture, and paper clips would all be governed by Article 2 of the Uniform Commercial Code.

TRUE

If the seller has made a substantial beginning in manufacturing custom-ordered goods, then an oral contract may be enforceable regardless of the amount of money involved in the contract.

TRUE

Lucky, a contractor, enters into a contract with Penny, a homeowner, to remodel her kitchen. The contract provides a specific completion date. The contract provides that if Lucky does not have the job finished by the date, Penny may deduct $100 per day from the contract price until the job is finished. This is an example of liquidated damages.

TRUE

Mary goes into Honest Harry's Electronics and purchases a TV. Mary agrees to pay for the TV in 30 days on the store's "30 days same as cash" plan. This is an executory contract.

TRUE

Most courts hold that a seller of goods is not entitled to consequential damages.

TRUE

One purpose of contract law is to make business matters more predictable.

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

Pastor Tom was employed by the First Church for 40 years. On Pastor Tom's retirement there was no adequate pension plan. Two months after the retirement, a wealthy parishioner, in consideration for Pastor Tom's 40 years of faithful service and for being such a "sweet" man, promised to pay him $500 per month for the rest of his life. This promise probably is not enforceable.

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

Robert offers to buy a car from Jane for $400. Jane must accept this offer in order to form an enforceable contract.

TRUE

Roger parked his car at a garage that has a large sign at the entrance saying, "This garage is not liable for items stolen from a car." This type of notice is referred to as an exculpatory clause.

TRUE

Specific performance is available when the subject matter of the contract is unique.

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 elements of a contract are agreement, consideration, legality, and capacity.

TRUE

The legal right to sue for a breach of contract is subject to a statute of limitations.

TRUE

Vernon suffers from a mental impairment due to a brain injury from a motorcycle 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 Vernon can show that Glena acted in bad faith.

TRUE

When promissory estoppel is used by the courts, it is because there is NOT an enforceable contract present.

TRUE

The mirror image rule requires that the acceptance exactly match the offer.

True

which of the following statements regarding alcohol and drug use is accurate?

The EEOC prohibits testing for prescription drugs unless a worker seems impaired.

The national labor relations act guarantees employees the right to join unions.

True

An express contract may be either written or oral.

True

An expression of opinion is not a valid offer.

True

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.

Mike owns a house in a poor area of a large city. Mike is on disability and his total monthly income is $700. A sales representative visits his home, selling a water purification system. Mike buys and signs a contract that calls for monthly payments of $500 for the next 10 years. The water system is worth no more than $1000. Mike did not understand what he was signing and thought it was a permission slip allowing the salesman to conduct a free water test to determine the number of toxins in the water. How would a court most likely describe this contract?

The contract is unenforceable because it is unconscionable.

Marty, a 16 year old, contracts with Cream-of-the-Crop Cycles to buy an $8000 motorcycle. Marty agrees to make monthly payments until the purchase price p;us interest are paid in full.

The contract is voidable by Marty.

The contractor can collect from the estate only.

determines who has the burden of proof.

The distinction between a condition precedent and a condition subsequent:

A union declares it will be engaging in a partial strike whereby its employees will alternate between working for a period of time and then walking off the job for an indefinite time. Thus, employees may work for a few days or only a few hours before walking off the job again. The employer claims the union does not have the legal right to engage in a partial strike. Which statement is correct?

The employer is correct. The union must either strike or work—it cannot alternate between working and striking.

what interest it is trying to protect

The first step a court takes in choosing a remedy is to determine:

Shelly offers to sell Jane goods both parties know are stolen. Jane accepts the offer, and agrees to pay for the goods. Later, Jane refuses to accept or pay for the goods. If Shelly sues Jane for breach of contract, what is the probable result?

The law would not enforce Jane's promise, as it does not have a lawful purpose.

UCC does not require all the terms of the agreement to be in writing.

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:

David and George have a contract wherein George agrees to buy sporting goods and equipment. Since the goods are not to be delivered for several months, they left the price open. Under the UCC, which of the following will be true?

The price will be the reasonable price based on fair market value of the goods at the time of delivery.

All of the above are correct.

The stated purpose(s) of Article 2 of the UCC is/are:

A union declares its workers are going on strike. The employer states the collective bargaining agreement is still in force for another eight months and that it contains a no-strike clause. The union claims the CBA's no-strike provision is not binding since new union leadership is in place. Which of the following statements is correct?

The union cannot strike because of the no-strike clause in the contract.

An offer made as a joke, where a reasonable person would conclude that it was made as a joke, cannot result in a contract.

True

Robert, a minor, buys a stereo from Jane for $200. State law allows a minor to disaffirm contracts within a reasonable time after turning 18. Robert disaffirms the contract the day after turning 18 and returns the stereo.

This contract was a voidable contract, Robert can disaffirm.

This is a material breach. Jackie owes nothing to Charles.

An offer must be communicated to the offeree or his agent in order for the offer to be effective.

True

R.L.'s defense will be the statute of frauds. A promise to pay the debt of another must be in writingwith the defendant's signature. A jury found that R.L. did not promise to become primarily liable forthe debts. Since this promise violates the statute of frauds, it is unenforceable unless an exception ap-plies. The bank argued the leading object rule or alternatively promissory estoppel. R.L. had no affili-ation or financial interest in his sons' corporation. Therefore there was no evidence to support the claim

Thomas Reep, was the president of First National Bank in Clarksville. R.L. Moore approached Reep requesting the bank to open an account in the name of Texas Continental Express, Inc., a corporation owned by his two sons. R.L. had no affiliation with the corporation nor any financial interest in it. R.L. promised Reep that he would open several accounts in First National that would more than amount to the business of his sons. R.L. assured Reep that if anything came up in connection with the sons' account, Reep was to contract him directly. Upon these conditions, First National proceeded to furnish a regular checking account and bank draft services for Texas Continental. Sometime later, First National paid two drafts overdrawing the account by $448,942. When Reep contacted R.L. about the overdrawn account, R.L. assured Reep that money would be deposited in the account. When Reep called back a few days later to find out why the money had not been deposited, R.L. informed Reep that his wife had suffered a nervous breakdown the night before and the deal was off. First National Bank brought suit to enforce R.L.'s promise to pay the debts of Texas Continental. What is the likely outcome?

Commercial impracticability means some event has occurred that neither party anticipated and fulfilling the contract would now be extraordinarily difficult and unfair to one party

True

Contracts have a number of legally essential elements, among which are an agreement and consideration.

True

Courts will not allow the rescission of a contract due to a unilateral mistake.

True

E-signatures are valid within all 50 states

True

has a duty of good faith which means honesty in fact.

Trey, a full-time college student, sold his car to Don, another student. In the performance of this contract, Trey:

3. The communication of an offer can be made by the offeror or the offeror's agent.

True

4. Generally, advertisements, catalogs, price lists, etc. are not treated as offers.

True

6. Consideration can consist of giving up a legal right.

True

7. A promise to act or to refrain from doing an act can serve as consideration.

True

74. Advertisements are generally not considered as offers to enter into a contract.

True

A "quasi-contract" is not really a contract

True

A counteroffer operates as a rejection of the original offer

True

A court may, at times, discharge a party who has not performed.

True

A model used in connection with selling goods will usually amount to a warranty that the goods will be as the model indicates.

True

A party injured by fraud generally has the choice of suing for damages or residing the contract?

True

A plaintiff must prove that he suffered actual injury to recover damages for fraud.

True

A promise to do some specified thing in the future is an offer.

True

A promises to pay B $50 if B will mow A's lawn. B completely and satisfactorily mows A's lawn. This is a unilateral contract.

True

After her 18th birthday Lara may, be words or action, ratify a contract she made during the previous year T/F ?

True

Agreement is usually evidenced by an offer and an acceptance.

True

Alice makes a material misrepresentation of fact to Betty, and based upon the misrepresentation, Betty enters into a contract. Betty now realizes she was deceived and wants to get out of the contract. This contract is voidable at Betty's option only.

True

Alice offers to sell her car to Barry of $500, and Barry accepts. Alice's car has a market value of $1,000 but this fact unknown to Alice. The contract is enforceable .

True

An advertisement offering a reward for the return of lost property usually is treated as an offer for a unilateral contract.

True

An employment contract is an example of a personal satisfaction contract.

True

Frank suffers from a mental impairment due to a brain injury from a airplane accident. He contract 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.- T/F ?

True

Fred offers to paint Debbie's home for $500. Debbie tells Fred she will only pay $450, and Fred agrees. Under these facts, Debbie is the "offeror."

True

Generally, A contract exists when an offer has been accepted?

True

Giving up a legal right to do something is enough to legally qualify as consideration.

True

If a minor can cancel a contract, it can be done at any time before the minor reaches the age of majority or within a reasonable time after reaching majority age.

True

If a person who has been declared incompetent by a court enters into an agreement, that agreement is void, because it does not meet all the requirements of a binding contract.

True

If the offer specifies it MUST be accepted by letter, a telegram will not be a valid means of acceptance.

True

In general, ambiguities in a written agreement are resolved against the party who drafted the agreement.

True

In order for an offer to be legally valid under the common law, it must have reasonably definite terms.

True

In ordinary sales transactions, the implied warranty of fitness for a particular purpose can be disclaimed, but the disclaimer must be in writing and conspicuous.

True

On July 12th, 2008, Louis offers to employ Teresa as head chef in his restaurant next year. The very next day, Teresa accepts the offer. The parties agree on a term of nine (9) months, and a $10,000 salary per month. Per their agreement, Teresa is to begin work on January 1. This contract falls within the scope of the statute of frauds, and thus will likely have to be in writing to be enforceable

True

One of the key issues in a promissory estoppel case is whether the defendant made a promise to the plaintiff that the plaintiff detrimentally relied upon.

True

One purpose of contract law is to make business matters more predictable.

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

Sarah, an artist, e-mails Patricia and offers to paint her portrait for $499.99. Patricia calls Sarah back and accepts the offer. Sarah promises to paint the portrait within one (1) year, if not sooner, and Patricia agrees to pay within six (6) months of the portrait's receipt. This is an enforceable, bilateral, executory contract.

True

Spencer, age 18 and of sound mind, has the legal capacity to contract.

True

T/F: 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

T/F: 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

The UCC imposes a duty of good faith on the performance and enforcement of every contract it covers.

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

enforceable because of the leading object rule.

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:

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.

Vivian goes to an auction and sees a rare antique lamp that is an identical match to one she already has. At the proper time she bids on the lamp and is the highest bidder. Even though she is the highest bidder, the auctioneer refuses to accept her bid and withdraws the lamp from the auction. Can the auctioneer do that?

Unless otherwise stated, the auctioneer had the right to withdraw the item before the fall of the hammer.

product misuse.

Van is using his wrench as a hammer when the wrench breaks and a piece flies off, injuring his neighbor who is helping Van change a tire on Van's car. If Van sues the tool manufacturer, its best defense will be:

Ron and several fellow workers of Vicy, Inc., a small manufacturing company, wished to organize a union. When Vicy learned of this activity, it issued a bulletin to all workers stating that a union will only hurt the company and that "we are a family that can solve any problems ourselves -- we do not need union activists from outside our company trying to tell us what to do!" Which statement is correct concerning the bulletin issued by Vicy?

Vicy has not committed an unfair labor practice. An employer may vigorously present anti-union views to its employees.

Wally owns 200 acres of land. Wally offers to sell the land to Robert for $1,500 per acre. Robert replies that he does not need 200 acres of land but would like to buy 40 acres at $1,500 per acre. Wally agrees to sell but does not identify which 40 acres. Later, Wally refuses to sell any land to Robert. What is the result?

Wally wins; this agreement is too indefinite since it does not identify which 40 acres are to be sold.

generally cannot be rescinded by the mistaken party unless the contract is unconscionable or it is proven that the nonmistaken party knew of the error

When a party to a contract makes a unilateral mistake, the contract:

relative size of the contract.

When courts consider economic duress, they consider all the following factors EXCEPT:

A consumer sales contract which charges 300 times the fair market value of the goods.

Which of the following contracts is most likely to be declared unconscionable?

Educational expenses

Which of the following is least likely to be regarded as a necessary?

All of the above.

Which of the following promises ordinarily must be in writing to be enforceable?

The buyer must cover.

Which of the following statements is not true regarding the buyer's right to cover?

A radio that does not pick up FM signals.

Which of the following would be a breach of the implied warranty of merchantability?

The first step a court takes in choosing a remedy is to determine:

what interest it is trying to protect.

Zero, Inc. agreed to build Millie a storage building for $8,000. After beginning the project, Zero realized that it could not complete the job and make a profit. Zero demanded $9,500 to complete the building. Millie agreed to pay the $9,500. When the project was complete, Millie tendered $8,000 to Zero for the job. If Zero sues Millie for the remaining $1,500:

Zero will lose because there was no legal consideration to support the additional $1,500.

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.

An unliquidated debt can be described as:

a debt in which the existence or amount is in dispute.

A contract clause which specifies the amount of damages to be paid in the event of a breach is called:

a liquidated damages clause

Harriett raises and sells hippos. In order to keep her hippos happy and healthy, she feeds them Hippo Chow, which she buys from the local pet store. Under the UCC, Harriett is:

a merchant of hippos, but not of Hippo Chow.

durress occurs when

a person is influenced to sign a contract under pressure

what is a whistleblower?

a person who informs on a person or organization engaged in an illicit activity.

The duty of fair representation created by the NLRA and the LMRDA requires that:

a union represent all members impartially and in good faith.

Sharon had a heart attack while she was under stress at work. Can she collect workers' compensation for the time she had to be away from work as she recovered? a. Yes, since the heart attack occurred while she was at work. b. Yes, if she can prove that the heart attack was caused by a fellow employee. c. No, since she probably would have had the heart attack whether she had been at work or not that particular day. d. No, since a heart attack is not considered a job-related injury.

a. Yes, since the heart attack occurred while she was at work.

Under the federal legislation known as OSHA: a. employers must keep records of all workplace injuries. b. employers must keep records of positive results of workplace drug tests. c. employees must keep their work area free from recognized hazards. d. employers may monitor workers' e-mail messages if the monitoring is done in the ordinary course of business and the employer provides the e-mail system.

a. employers must keep records of all workplace injuries.

Orson was fired from his job behind the ticket counter at the airport. He was loudly told to put his personal belongings into a plastic bag and was led out by security guards in front of his co-workers and customers. His supervisor told him not to return. Orson's employer faces potential liability for: a. intentional infliction of emotional distress. b. whistleblowing. c. defamation. d. violation of the FLSA.

a. intentional infliction of emotional distress.

Jessica was a former employee of Mark. When potential employers called Mark for a reference about Jessica, he stated she was not a very good worker and had been fired for excessive absences. He said he believed Jessica was on drugs, but he did not know for sure. Jessica learned what Mark was saying and sued him. In most states: a. it was legal for Mark to say what he said if it was true and Mark was not motivated by ill will. b. it was legal for Mark to say what he said, since courts have consistently ruled that former employers are immune from lawsuits for giving references. c. it was not proper for Mark to say what he said, since courts have consistently ruled that former employers should not give references over the telephone or in writing without the former employee's written authorization. d. though it was proper for Mark to talk about Jessica's work-related history, he acted improperly when he said he thought she was on drugs.

a. it was legal for Mark to say what he said if it was true and Mark was not motivated by ill will.

The Fair Labor Standards Act: a. wage provisions do not apply to professional or managerial employees. b. limits the number of hours an employer can require a person to work in any given week. c. does not apply to children. d. preempts any state wage regulation.

a. wage provisions do not apply to professional or managerial employees.

If Crosby and Dash are in disagreement as to the exact amount of money that Crosby owes Dash, then they may choose to form a new agreement at a set amount. If they both perform the new agreement, their conduct would be an example of:

an accord and satisfaction.

Bailey Co. and Spryt Bros. enter into a contract for the manufacture and sale of 400 lawn chairs. If both parties agree that a modification is necessary:

an agreement to rescind the contract will terminate the contractual rights of Bailey Co. and Spryt Bros. if neither of them had completed their obligations.

Reformation is:

an equitable remedy

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.

An agreement in which a buyer agrees to buy all the goods produced by a manufacturer is known as:

an output contract

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.

Secondary boycotts:

are generally illegal.

If a court awards nominal damages it will generally:

award very little money.

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? a. "This horse is only six years old." b. "There is no better car in the world." c. "The tires have less than 5,000 miles on them." d. "This car gets 28 miles per gallon. "

b. "There is no better car in the world."

When may an employer require an employee to submit to a lie detector test? a. When the employee has been hired for less than 90 days b. When the test is part of an on-going investigation into crimes that have occurred. c. When the employer has reason to believe the employee is using illegal drugs on the job. d. When all employees are being questioned using a lie detector.

b. When the test is part of an on-going investigation into crimes that have occurred.

The Family and Medical Leave Act applies to: a. companies with 15 or more full-time workers. b. companies with 50 or more employees. c. companies with 100 or more employees. d. any company engaged in interstate commerce.

b. companies with 50 or more employees.

Maxine lost her job as an electrical engineer with a large company which had provided health insurance benefits for Maxine and her family. She now: a. must try to find insurance on her own or try to find another job with health insurance benefits. b. is protected under COBRA, which allows her continued health insurance coverage for 18 months as long as she pays the cost. c. is protected under COBRA, which requires her employer to continue her health insurance coverage for six months under whatever copayment arrangements she had while she was employed. d. has some protection under the NLRA, which requires her employer to pay for continued health insurance for three months following her termination if she did not leave the company voluntarily.

b. is protected under COBRA, which allows her continued health insurance coverage for 18 months as long as she pays the cost.

In 1932, Congress passed what legislation prohibiting federal court injunctions in nonviolent labor dis-putes, thereby declaring that workers should be permitted to organize unions and use their collective power to achieve legitimate economic ends? a. The Sherman Act. b. The Norris-LaGuardia Act. c. The National Labor Relations Act. d. The Labor-Management Relations Act

b. The Norris-LaGuardia Act.

Zena enters into a contract with Steeley Company to purchase a washer and dryer. She doesn't understand the financing terms, but signs the agreement anyway because she needs the appliances. The financing terms are very unfavorable to Zena, and she is unable to make all of her payments when they are due. Steeley sues. The court would:

be exercising judicial restraint if it requires Zena to pay as she promised, even if the agreement was unfair and unwise.

The remedy of reformation:

can be used to correct mistakes in the original contract

cannot recover its expectation interest because there was no enforceable agreement.

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, in time for the Christmas season. The shipment did not arrive until December 1. In spite of the delay, All Seasons covered a third of the order through other suppliers, but had to pay 15% more than the price under contract with Santa, Inc. As a further result of the delay, All Seasons' sales were down 25%. All Seasons can recover:

compensatory damages and consequential damages.

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 necessary. 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.

Jim was a mechanic. One day when he attempted to weld a car's gasoline tank, it exploded and he was hurt. He filed to collect workers' compensation. His employer resisted on grounds that Jim had been negligent and had also violated the express regulations of the company when he attempted to weld a gasoline tank. Which statement is correct? a. Jim cannot recover if it is shown that his negligent conduct caused the explosion. b. Jim cannot recover if it is shown that he violated the express regulations of his employer. c. Workers' compensation doesn't apply in situations like this. d. Jim can recover even if he was negligent and violated the employer's rules.

d. Jim can recover even if he was negligent and violated the employer's rules.

Megan was employed by a large company. Her supervisor told her to falsify government reports. She refused and was fired. She sued for wrongful discharge. Her employer claimed that, since Megan was an at-will employee, she had no legal right to claim the company was liable for damages. Is the employer right? a. Yes. An at-will employee does not have a legal right to claim wrongful discharge of employment. b. Yes. As an employee, Megan owes a duty of loyalty to her employer. If the company was found to have acted illegally by falsifying the reports, it (not Megan) would be liable. c. No. Even though Megan was an at-will employee, such employees may not be fired without just cause. d. No. Though at-will employees do not have extensive rights relative to job security, they may not be legally fired for refusing to perform an illegal act.

d. No. Though at-will employees do not have extensive rights relative to job security, they may not be legally fired for refusing to perform an illegal act.

Which of the following is NOT a true statement about fraud? a. The plaintiff must prove that the defendant has knowledge of the falsity of his or her statement. b. It is necessary for the plaintiff to show that he or she has suffered some type of detriment or injury because of his or her reasonable reliance on the defendant's false statement. c. The defendant made the statement with the intent to induce the plaintiff to enter into the contract. d. 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.

d. 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.

Mega Corp. hired permanent replacement workers when its union went out on strike seeking better medical and retirement benefits. After the strike is over, Mega Corp.:

does not have to give the striking employees their jobs back since this was an economic strike.

If Edmund and Kaylin have a writing mistakenly showing a sale and purchase of goods for $10,000 when the price should have been $1,000, a court will:

enforce the agreement, relying on oral testimony to determine the correct price.

Bob signed an agreement with Joe under which Bob agreed to purchase all the hay that Joe grew during the coming growing season. This contract will be:

enforceable as long as both parties act in good faith and Bob doesn't suddenly demand more hay than what was reasonably estimated.

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 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 promise by Derkin Restaurants to buy all of the produce it needs this next year at an established price from Elfredo's Produce would be an:

enforceable requirements contract.

enforceable, because Willis has partially performed the oral contract and made improvements on the land.

Employees of Truan went on strike because Truan refused to bargain in good faith. After the strike, the striking workers are:

entitled to get their jobs back.

Mike made the following offer to Mick: "I will pay you $500 if you agree to paint my house." Mick replied that he would. At this point, the contract is an:

executory, bilateral, express contract.

A battery occurs only if the victim suffers actual physical harm.

false

A buyer from a thief can acquire title to the goods as a good faith purchaser.

false

A chair bought by a business office would be classified as a consumer good.

false

A contract for the sale of goods must include a price to be enforceable under the UCC.

false

A creditor with a mechanic's lien on property can prevent the sale of the property but cannot sell the property to satisfy the debt

false

A creditor's extension of time to a debtor for making payment, without the consent of the surety, will not discharge the surety.

false

A debt does not have to be past due before a creditor can begin legal action against a debtor.

false

A mechanic's lien can be enforced to obtain payment for work that adds value to personal property.

false

A party trying to establish mutual mistake as a defense to the enforcement of a contract must show that the other party had "scienter" (guilty knowledge) of the mistaken fact.

false

A patent is available for an idea as well as a tangible application.

false

A patent may be renewed.

false

A pledge is a promise made by a debtor to take reasonable care of the property.

false

A security agreement's description of collateral as "all the debtor's assets" is sufficient to reasonably identify the property.

false

A security interest is enforceable only if the collateral is in the possession of the secured party.

false

A security interest is not enforceable after the creditor's rights have attached to the collateral.

false

A seller's statement that "this is a terrific used car" generally creates an express warranty.

false

A service mark is used to distinguish products produced by the federal government from those produced by private corporations.

false

A statement that a particular truck can haul a 3,000 pound load would be treated as an opinion and would not become an express warranty.

false

An assault may be committed when a person acts in a way so as to create an apprehension of offensive contact in the distant future.

false

An employee who divulges secret trade information cannot be sued.

false

An improper filing does not render a secured party unperfected.

false

As a general rule, employers have a legal obligation to disclose information about former employees to potential future employers.

false

Bankruptcy law has one goal: to ensure equitable treatment to creditors who are competing for a debtor's assets.

false

Because he's a good friend, and has known Hilda a long time, Scott fixes Hilda's car as a surprise for her birthday. When Hilda sees it, she is so happy, she promises to give Scott $1000 the following week for doing the work. He gratefully accepts. A court would likely find that this promise to be supported by valid consideration; and Hilda's promise to pay $1000 is enforceable as a contract.

false

Bob has not paid his ex-wife alimony as required under court order. His ex-wife is trying to collect the alimony Bob owes her. Bob files a bankruptcy petition. This automatically stays his ex-wife's collection efforts.

false

Bob sends Larry Lawyer, his attorney, a letter in which he accuses him of being "an incompetent lawyer." Larry is not incompetent, and Bob knows that the statement he is making is false. This constitutes the tort of defamation.

false

Electronic surveillance for the purpose of acquiring trade secrets is permissible under the law of unfair competition.

false

Filing a financing statement with the appropriate public office is the only way to perfect a purchase-money security interest in consumer goods.

false

Filing bankruptcy will automatically discharge all debts, including student loans and child support payments.

false

If a debtor cannot, or will not, pay a judgment, a creditor can only resort to "self-help" to collect.

false

In a contract of suretyship, the surety is secondarily liable on an obligation and becomes primarily liable only when the debtor cannot pay the debt.

false

In a defamation suit where the plaintiff is a "public figure," the defendant must prove that the plaintiff acted "with actual malice."

false

In a strict liability case, the plaintiff still must prove that the defendant breached a duty.

false

In order to be liable for conversion, the defendant must know that the property rightfully belongs to someone else.

false

Negligence may best be described as an intentional tort.

false

One distinction between nuisance and trespass to land is that trespass to land involves intrusions by human beings, while nuisance involves intrusions by other forces.

false

Persons found liable for a tort usually must either pay a fine or serve time in prison.

false

Prior to any battery, an assault (even if only momentarily) must have occurred.

false

Puffery is fraud.

false

The UCC always governs breach of contract cases involving a combination of services and tangible movable goods.

false

The UCC, not common law, covers the sale of real estate and services.

false

The plaintiff's burden of proof in a tort action is beyond a reasonable doubt.

false

The same act can never be both a tort and a crime.

false

There is a higher precentage of workers in labor unions now than any other point in history

false

To have an enforceable security interest in collateral that is in the possession of the secured party, there must be a written security agreement.

false

Under the Family and Medical Leave Act, an employee can take up to 12 weeks of paid leave each year for certain personal and family illness situations.

false

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 nonmistaken party knew of the error.

have a contract and, in the majority of states, the different terms will cancel each other out.

Costs to rent a vehicle for a short period of time after an auto dealer fails to deliver a purchased vehicle would be:

incidental damages.

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: a. win because he relied on the misrepresentation. b. win because there was a misrepresentation of a material fact. c. lose because he will not be able to prove reliance on the misrepresentation. d. lose because Forrester made a unilateral mistake.

lose because he will not be able to prove reliance on the misrepresentation.

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.

Hensley and Boyer have been negotiating for several months over issues related to the purchase and sale of some real estate. They draft a letter of intent which:

may or may not be an offer, depending on the exact language and whether the document indicates that the parties have reached an agreement.

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.

A company's collective bargaining agreement has expired and negotiations are underway for a new one. After one exhausting session, union leaders have decided management will not bargain in good faith. The union declares it will be going out on strike the following midnight if an agreement is not reached. The union:

must give the employer at least 60 days' notice before going out on strike.

If Becky promises not to drink alcohol until she becomes a legal adult in exchange for Ben's promise of $1,000, the agreement is:

not enforceable because Becky does not have a legal right to drink alcohol.

John owns a thoroughbred horse named Prince Charming that just ran in the Kentucky Derby. Prince Charming came in last, much to John's frustration and embarrassment. John exclaims in a loud voice, "I'm selling that horse to the first person who hands me $100 bucks!" John has:

not made an offer because under the circumstances a reasonable person would not conclude that John had intent to make an offer.

If a condition does not occur:

one party will probably be discharged without performing.

The basic distinction between a bilateral contract and a unilateral contract is that:

only one promise is involved in a unilateral contract.

In a promissory estoppel case, a court will generally award:

only reliance damages.

Opinion is generally a valid defense in a defamation lawsuit because it cannot be proven to be true or false.

true

When courts consider economic duress, they consider all the following factors except

relative size of the contract.

Under a contract for the sale of land, the statute of frauds:

requires the defendant to sign the agreement.

A minor can undo a contract that has already been completed by having a court______ the contract to formally cancel it.

rescind

Fred purchased a Cheapp Lawnmower because the Cheapp Company salesperson intentionally misled him by assuring him that the mower was self-propelled, mulched, and had a five-year unlimited manufacturer's warranty. When Fred finds out that his new Cheapp Lawnmower is not self-propelled, does not mulch, and has a 90-day warranty, he may successfully sue for:

restitution and possibly punitive damages

Mary owes $3,800 on her credit card. She sends the credit card company a check for $800 with the notation "payment in full" on the check. If the credit card issuer cashes the check:

the check may be subject to a UCC exception to the general rules for accord and satisfaction cases involving checks.

John enters into a contract to paint Chad's house. When Chad decides on a color, John will buy the paint and paint the house for the price of $2,500. This contract is governed by:

the common law of contracts governs because the predominant factor of the contract is for the sale of services and not goods.

If Morales and Rolfes Supply negotiate for the purchase and sale of a supply of fuel for a three-year period for Morales' business:

the contract may indicate a method for determining the price, without stating a definite price.

the difference between Solomon's contract price and the amount paid by Renny.

Regency Construction placed an order for two hundred 2 x 4s from Lumber Jack. If the place of delivery and time for shipping the goods are not specified, the UCC provides:

the place of delivery is Lumber Jack's and the time for delivering the lumber is a reasonable time based on normal trade practice.

A seller's form clearly states no warranty is included. The buyer's form states that the seller warrants the goods for one year. In this case:

the warranty term is a "different term," and the majority of states hold that a contract can be formed but the contradictory terms cancel each other out.

The intent of the offeror to extend an offer to the offeree is generally determined by reference to:

the words and conduct of the offeror.

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.

"Res ipsa loquitur" means "the thing speaks for itself" and raises a presumption of breach of duty and causation in negligence cases.

true

A bankruptcy court looks at the totality of a debtor's circumstances to determine whether the debtor's petition for relief under Chapter 7 constitutes substantial abuse.

true

A company is generally not liable for the criminal acts of its employees.

true

A contract of suretyship must be in writing to be enforceable.

true

A copyright does not last forever.

true

A copyright owner's failure to use a proper copyright notice does not cause her to forfeit copyright protection.

true

A creditor with an artisan's lien on property can sell the property to satisfy the debt.

true

A defendant who engages in an ultrahazardous activity is liable for any harm that results from the activity.

true

A fanciful use of ordinary words may be trademarked.

true

A financing statement is effective even if it is filed electronically.

true

A guarantor becomes primarily liable only when a debtor cannot pay a debt.

true

A guarantor is secondarily liable on an obligation.

true

A purchase-money security interest in consumer goods is perfected automatically at the time of a credit sale.

true

A security agreement may cover after-acquired property of the debtor--if it says so.

true

A security interest is not enforceable unless the creditor's rights have attached to the collateral.

true

A surety can use any defenses available to a debtor to avoid liability on the obligation to the creditor.

true

A tort is a violation of a duty imposed by the civil law.

true

A trademark differs from a service mark in that the latter describes services.

true

A writ of execution is a court order to seize a debtor's property after the entry of a final judgment in a creditor's lawsuit against the debtor.

true

According to the UCC, unless otherwise specified or agreed upon, all goods in a contract must be rendered in a single delivery.

true

An arbitrary use of ordinary words may not be trademarked.

true

An artisan's lien is effective only if a creditor has possession of the property.

true

An authenticated security agreement can be in an electronic medium.

true

An implied warranty of merchantability arises in every sale or lease by a merchant.

true

Arthur offers Bob, an employee of Carl, a job with his company at a yearly salary of $10,000 more than Bob receives under the contractual relationship between Bob and Carl. Arthur knows about the contract between Bob and Carl and knows that the contract should run for another five years, but Arthur wants Bob to work for him. Arthur probably is liable to Carl for intentional interference with contractual relations.

true

Attachment of a security interest is a necessary condition for its perfection

true

Bankruptcy proceedings are held in federal bankruptcy courts.

true

Bill dictates a letter to his assistant, Barbara. The letter is addressed to Betty Bonds, his accountant, and in it, he accuses Betty of being dishonest - when he knows sheis not! Barbara never types the letter, and does not send it to Betty. Nevertheless, Bill has likely committed the tort of defamation.

true

Bob throws a ball across his neighbor's property, and the ball then lands in the street; this could constitute "trespass to land."

true

Bob writes an all-new, original, marching song. Bob's song is copyrightable.

true

Brad doesn't like Rob and especially dislikes Rob's new felt hat, so he intentionally knocks it off Rob's head in order to embarrass Rob. Brad has committed a battery.

true

Compensatory damages include damages for past and future pain and suffering.

true

Computer software may be patentable.

true

Consent can be raised as a defense to battery.

true

Conversion is wrongfully taking or retaining an individual's personal property and placing it in the service of another.

true

Dan lends Susan $500. She agrees to pay Dan $100 a month until the $500 is paid. She gives Dan her diamond ring to hold until she fully satisfies the debt. The ringis "collateral."

true

Defendants who engage in ultrahazardous activities are almost always strictly liable for any harm they cause.

true

During the hiring interview, Supervisor Staci told Henry that as long as he did his job as requested, he would have a job until he retired. Courts have been willing to enforce such an oral promise, even if the company's top management did not approve the statement.

true

Even though no one else had developed an invention like that of the patent applicant, the application will be denied if, at the time of the invention, the invention would have been obvious to a person having ordinary skill in the area.

true

Filing a petition for bankruptcy automatically stays most legal actions filed against the debtor.

true

Firing an employee for her refusal to violate the law would raise a claim of wrongful discharge.

true

For a creditor to have an enforceable security interest, it is necessary that the debtor have rights in the collateral.

true

For a financing statement to be valid, it must contain a description of the collateral.

true

For a mark to be protected under federal law, it must be registered with the Patent and Trademark Office.

true

For the implied warranty of fitness for a particular purpose to apply, the seller must have actually known the purpose for which the buyer was purchasing the goods.

true

Generally, sellers must design their products to be safe when foreseeably misused.

true

Georgia's company may lawfully discover Samantha's company's trade secrets if Samantha's company fails to take reasonable precautions to protect their trade secrets.

true

If a trademarked name acquires a generic meaning the owner of the trademark loses protection.

true

In a defamation action, the plaintiff must prove that the defendant communicated a false statement to a third party.

true

In order for a plaintiff to win a case involving intentional infliction of emotional distress, she must prove the defendant acted in an extreme and outrageous manner.

true

In order for an artisan's lien to be valid, the lienholder normally must have possession of the property.

true

In order to be liable for negligence a person must have owed a duty of care to the plaintiff.

true

In ordinary sales transactions, the warranty of title can be disclaimed or modified only by specific language in a contract.

true

In some cases, failure to warn about a product's dangers can make an otherwise safe product defective.

true

In tort law, intent means only that the actor intended the consequences of his or her act or knew with substantial certainty that certain consequences would result from the act.

true

Infringement is the unauthorized use of the intellectual property of another.

true

It is possible, on a debtor's bankruptcy, that an unsecured creditor might receive nothing to cover the debt.

true

Knowing and intentional infringement of a mark can be a criminal offense.

true

Komco Computer Company has developed a new and innovative magazine and television ad campaign that it would like to protect from use by its competitors. Komco may copyright its magazine and television ads.

true

Libel involves the written communication of defamatory language.

true

One who participates in an activity subject to strict liability will be held liable for damages resulting from the activity even if he exercised reasonable care in undertaking the activity.

true

The management and union at TriColor have bargained for two years without reaching an agreement. After notifying the union, TriColor prohibited the workers from entering the factory to work. This is a lockout.

true

The word "truck" cannot be a trademark for trucks, although it could be a trademark for a new brand of designer jeans.

true

Tim and his friend are playing catch in the back yard when Tim suddenly throws the ball over the fence into the neighbor's yard where it breaks a window. This is trespass to real property, even if Tim himself does not go onto the property to get the ball.

true

To commit an intentional tort, a person need not act with a harmful motive.

true

To commit the tort of trespass to land, a person does not need to actually harm the land.

true

To create an enforceable security interest, the secured party must give value.

true

To succeed in a product liability suit based on strict liability, a plaintiff does not need to prove why or how a product became defective.

true

Tort law provides legal remedies for both personal injury and property damage.

true

Trade secrets are information held as confidential by a company and its employees.

true

Truth is a complete defense to defamation.

true

Under the new Restatement (Third) of Torts, a manufacturing defect exists only when it is shown that: 1) the product has departed from its intended design; and 2) the manufacturer failed to exercise "due care" in the manufacturing process.

true

Unless the warranty of merchantability is expressly disclaimed, all merchants warrant that the goods they sell are fit for the general purpose for which they are intended to be used.

true

Valley Mart told its employees that they would be fired if they actively supported a unionizing effort. Valley Mart has committed an unfair labor practice.

true

When a court determines whether the defendant has breached his or her duty of care to the plaintiff, the court asks whether the defendant acted the way a reasonable person would in similar circumstances.

true

When an offer governed by the UCC does not specify a means of acceptance, it can be accepted by any means reasonable under the circumstances.

true

Where the creditor has possession of the collateral, the security agreement may be oral

true

sit down strikes in which members stop working but remain at their posts, physically blocking replacement workers from taking their places; this is legal

true

When a contract falls within the statute of frauds but is not reduced to a writing, the contract is:

unenforceable

Larry goes to his barber who has cut his hair for the past several years. The barber proceeds to cut his hair as they talk about the most recent snow storm to hit the area. This is an example of a:

unilateral, implied contract.

ABC Siding, Inc. manufactures aluminum siding. ABC enters into a contract to deliver siding to Slippery Siding, Ltd., a retailer of aluminum siding. The written agreement insists that all modifications to the agreement be in writing and signed by both parties. This prohibition against oral modifications is:

valid regardless of whether the clause is signed separately.

On January 8, Quastrar, Inc. sent Hylavian Company a letter offering to sell $10,000 in restaurant supplies. On January 18, Hylavian mailed a letter to Quastrar accepting the offer. Quastrar received the acceptance letter on January 20. On January 17, Quastrar sent a letter revoking the offer. Hylavian received this letter on January 21. A contract between Quastrar and Hylavian:

was formed on January 18.

The Johnsons decided to sell their summer cabin on Beech Lake. They sent flyers out to all who previously had expressed an interest in buying the cabin stating that they were planning on selling their cabin. The flyer described the location of the property, the size of the lot, and the price. If one of the recipients responds by sending a letter accepting, an agreement:

will not be formed because the flyer was sent out as an invitation to negotiate.

Miles purchased a lawnmower with an attached warning that said, "The manufacturer is not responsible in the case of an injury caused by the lawnmower." If Miles is injured because of a defect in the mower and sues the lawnmower manufacturer, he will most likely:

win, as this warning would be unenforceable.

Zoe, who works as a retail clerk, wishes to talk with her co-workers about organizing a union. Her employer threatens to fire her if she talks with other workers about union activity in the presence of customers while she is working. Does the employer have a legal right to make this threat to Zoe?

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