Business Law Final

Rose questions whether there is consideration for her contract to perform with Saxophone Symphony. To constitute consideration, there must be

a bargained-for exchange

Clay offers to pay Dian $50 for a golf lesson for Ewan. They agree to meet on Friday to exchange the cash for the lesson. These parties have

a bilateral contract

Khan offers to buy Lonnie's 1967 Mustang only if an appraiser estimates that it can be restored for less than a certain price. This requirement is

a condition precedent

Brock enters into a contract with Casey's Coin-op Laundry to move a suite of dryers from one of Casey's locations to another. Brock subsequently transfers this duty to Darin. Darin is

a delegatee

Market Company and Nick enter into a contract for Nick to cut and trim the landscaping around Market's building before a meeting of the company's sales staff. When Nick's schedule conflicts, he asks Otis to do the cutting and trimming. This transfer of duties is

a delegation

Copper Circuit, Inc., and Direct Electric LLC sign an agreement that provides for the payment of "$1,000 by whichever party commits a material breach of the contract that creates damages difficult to estimate but approximately $1,000." This is

a liquidated damages clause

Isaac holds one ton of perishable fruit in storage for Juice Smoothies Corporation. Juice Smoothies does not pay for the storage. Isaac sells the fruit to Kayo Beverage Company. This sale represents

a mitigation of damages

Gliding Light, LLC, and Hang Gliders, Inc., are parties to a contract. They subsequently agree that High Riders Inc. should take Gliding Light's place and assume all of its rights and duties under the contract. This is

a novation

Hal's Hardware Inc. and Ideal Tools Corporation sign a written contract for a sale of goods. To be enforceable, this written contract must include

a quantity term, such as "50 hammers" or "100 boxes of assorted nails."

Leslie pays Mobile Electronics $600 for a new phone. Under the UCC, this is

a sale

Ren offers to pay Sara to pick up and deliver certain business documents withing thirty minutes. Sara can accept the offer only by completing the task withing the deadline. if she does, Ren and Sara will have.

a unilateral contract

Rally Corporation enters into a contract to sell ski gear to Sno-Sports Inc., which sells a pair of the skis to Tyra, a consumer, who later sells them to Upton, another consumer. Article 2 of the UCC applies to the sales transactions between

all of the buyers and sellers

Faye makes and sells furniture. Faye and Glen enter into a contract for the delivery of Faye's products to Glen's Gear retail locations for which he agrees to pay the invoiced price. Faye transfers her right to payment under the contract to Haulers Trucking Company. This transfer is

an assignment

Bo signs a lease with Capri Apartments to lease a studio apartment for the next year for $650 per month. Daisy signs on Capri's behalf. Bo and Capri have

an express contract

Simone offers Thom a dozen piano lessons for a certain price per lesson but conditions the deal on Thom accepting the offer by April 1. Simone may revoke the offer

before Thom accepts the offer

Jason and Kelly enter into a contract for Jason to renovate Kelly's house by a certain date. Jason never performs. After the applicable limitations period has passed, Kelly decides to bring a suit against Jason for breach. This suit

can no longer be brought

Kevin obtains a loan from Liberty Credit Bank at an interest rate that exceeds the state's maximum. Liberty has

committed usury

Ed's Electric substantially performs its contract with Forest Hills Apartments, Inc., to deliver and install an alarm system and parking lot lighting. Forest Hills is entitled to

damages

Planners & Builders, Inc., enters into a contract with O'Reilly to refurbish a garage on his property as an auto repair shop. O'Reilly's neighbor Nora challenges the project as a violation of the local zoning laws. A court orders a halt to the project. O'Reilly's contract with Planners & Builders is

discharged

​Dim threatens physical harm to force Ed to sell his business, Flowers, Inc., to Dim for a below-market price. This is

duress

Lou offers to service Millie's heating and air conditioning system for one year for $500. Under the mirror image rule, Millie's response will be considered an acceptance if the terms of the acceptance

exactly mirror those of the offer

Francie drives into Gage's Auto Service and asks gage to replace a tire on her car. after gage replaces the tire, but before Francie pays for it, any contract between them is

executory

An acceptance can materially change or add to the terms of the original offer without rejecting it.

false

An innocent party does not need to suffer an injury to collect damages as a result of a misrepresentation.

false

In contract law, "consideration" refers to the courtesy that one party shows another in negotiating a deal

false

In general, a court will question the adequacy of consideration based solely on the comparative value of the things exchanged.

false

Under the Statute of Frauds, all contracts must be in writing to be enforceable except those involving insignificant transactions.

false

When both parties to a contract are mistaken about the same material fact, the contract cannot be rescinded.

false

a contract entered into by an intoxicated person is always valid.

false

a covenant not to sue is against public policy

false

a promise to do what one already has a legal duty to do constitutes legally sufficient consideration

false

an offer does not need to be communicated to the offeree to become effective.

false

if a promise is made, it will be enforced

false

in an employment contract, a covenant not to compete is unenforceable

false

in contract law, consideration refers to the time that a party takes to evaluate a deal.

false

in contract law, intent is determined by the secret, subjective intent, or belief, of a party.

false

there are no revocable offers

false

Lee applies to Marketing Corporation for a position as a software engineer. Lee has no training in computers or programming and no background as an engineer. After Lee is hired, Marketing learns the truth. The employer can rescind the contract on the basis of

fraud

Lana agrees to work as Michelle's personal assistant for one year but dies in the ninth month of the contract. Lana's estate

is discharged from any contractual liability

Orin signs a covenant not to compete with his employer, Product Distribution, Inc. The covenant will be enforced if it

is reasonable with respect to geographic area and duration.

Kim promises to pay Leo $500 to install a sump pump in Kim's warehouse. Leo completes the installation. The act of installing the pump

is the consideration that creates Kim's obligation to pay Leo.

Rory questions whether there is consideration for his contract with Silver Spurs Club to exchange his performance of country music on certain dates for Silver's payment of a certain amount. To constitute consideration, the value of whaterver is exchanged must be

legally sufficient

Juan and Isidro enter into a contract to buy, restore and reopen the Coastal Park Carousel. Before either party begins to perform, they agree to cancel their deal. This is

mutual recission

Maya tries to start her new car with no sucess. She yells that she will sell the car to anyone for $10. Nero, a passerby who owns Nero's Motors, hands Maya $10. This is

not a valid acceptance because maya does not seriously intend to sell.

Intoxicated and not aware of the consequences, Grady agrees to a two-year phone service contract with Horizon, Inc., at more than the average market price. This contract is

not enforceable if Grady was intoxicated enough to lack mental capacity.

Carlos and David contract for the sale of five hundred head of Carlos's cattle for $95 per head. Unknown to either party, an unforeseen storm has struck the herd and many of the cattle have died. David is

not required to pay due to the bilateral mistake

Lewis tells a representative of Musical Instruments, Inc., that he will pay for Nora's trumpet if she does not. Lewis does not secure any personal benefit for this promise. This promise is enforceable as a contract

only if it is in writing

In selling a 300 acres of rural land to Organic Farms, Peyton tells the buyer that the land "will be worth twice as much by next year." This is

opinion

Dharma enters into a contract to manage the operations of Esther's dental office for one year, renewable for subsequent one-year terms. If this contract is discharged like most contracts, it will be

performed

​Pico, a famous chef, agrees to give ten culinary lessons to Rhoda in exchange for $1,200. Pico's attempt to transfer his contract duties to Sven, an unknown sous-chef, will probably be

prohibited if Pico and Sven have different skill levels

Global Enterprise enters into a contract with HealthCare Insurance to obtain insurance for Global employees. HealthCare breaches the contract and Global is awarded compensatory damages. The purpose is to

provide global with funds for its loss of the bargain

Meatpackers, Inc., enters into a contract with Nevada Ranch for the delivery of a certain number of beef cattle on a set schedule. The ranch delays the first delivery for five days, aware that Meatpackers loses a certain percentage of profit each day. An award to Meatpackers of consequential damages would

provide the buyer with funds for a foreseeable loss beyond the contract

Forest Lumber Company orally contracts with Gail for the purchase of five acres of Gail's timberland. Gail makes the transfer but Forest Lumber does not pay the price. Gail could most likely recover on a theory of

quasi contract

Lauren files a suit against Moving Service for breach of contract, based on what Lauren claims was Moving's offer. For a court to determine if a contract has been breached, under the common law, the offer must include terms that are

reasonably definite

Stitches Corporation enters into a contract to sell denim clothing to Trend Fashion Company, which in turn sells the clothing to consumers. In contrast to standards that apply to consumers, the UCC imposes on merchants

special business standards

Isabel orally agrees to buy a unique collection of nineteenth-century cowboy memorabilia for $10,000 from Jessie and sends $2,500 as a down payment. When Isabel pays the rest of the price, Jessie refuses to ship the collection. Isabel should seek

specific performance

At an auction, Benny bids on a 1957 Chevy coupe, believing that it is worth more than the price asked. When the car proves to need more repairs than Benny estimated, and thus is worth less as is, Benny is

still liable on the bid

Building Restoration, Inc. (BRI), enters into a contract to refurbish an old train depot for Casual Dining, Inc., to open as Eat Up Restaurant. If BRI completes most of the work promised in the contract, its performance will be

substantial

Ready Repair Service enters into a contract to fix washers and dryers in Scrub n' Dry Company's coin-operated laundries. If Ready Repair breaches the contract, Scrub n' Dry can

sue Ready Repair for damages

In an exchange of e-mails, Rob, a landlord, and Sam agree to a lease of a certain apartment for one year. Under the Statute of Frauds, this lease is enforceable provided

the e-mail is signed by the party against whom enforcement is sought.

Bob claims that Carla breached their contract for tutoring. Carla responds that she never intended to enter into a contract with Bob. The intent to enter into a contract is determined with reference to

the objective theory of contracts

Over the course of a year, Retail Marketers, Inc., sells goods from its inventory and one of its warehouses. In exchange, Retail receives checks and other items that substitute for cash, which Retail uses to repay a loan from Savings Bank. Article 2 of the UCC governs

the sale of the goods

Maya and Nick enter into a contract. To be enforceable, the contract must include

the signature of the party against whom enforcement is sought

Merl buys a tablet for $500, running shoes for $200, and a set of the Game of Crowns books for $100. To be enforceable as a contract, a writing is required for the purchase of

the tablet only

An e-contract must meet the same basic requirements as a paper contract.

true

If no time for acceptance is specified in an offer, the offer terminates at the end of a reasonable time.

true

Terms in a shrink-wrap agreement have been enforced in the same way as the terms of other contracts.

true

a bilateral contract comes into existence at the moment promises are exchanged.

true

a minor has a reasonable time, after the minor reaches the age of majority, to disaffirm a contract

true

a quasi contract is a fictional contract

true

a unilateral contract is formed at the moment when the contract is performed

true

all states require that members of certain professions obtain licenses allowing them to practice

true

an executed contract is one that has been fully performed.

true

an express contract must be in writing

true

any contract to commit a crime is unenforceable

true

contractual capacity refers to the legal ability to enter into a contract

true

intent to decieve is an element of fraud.

true

reformation occurs when a court alters the terms of a contract to reflect the true intent of the parties.

true

Gene, an accountant, convinces his client Hazel to sign a contract to invest her savings in 2Gether, a nonexistent social-networking Web site. There is clear and convincing evidence that Hazel did not act out of her free will. This is

undue influence

Under a contract with Valley Vineyard, Walsh begins grading a terraced hillside for the planting of grapes. Halfway through the project, Walsh asks for $5,000 over the contract price, claiming an increase in the "cost of doing business." Valley agrees but later refuses to pay. Valley's agreement to pay more is

unenforceable because Walsh's performance was a preexisting duty

A court adjudicates Henry mentally incompetent and appoints Inez to be his guardian. Later, without Inez's knowledge, Henry signs a contract to sell his farm to Jason for its real market value. The contract is

void

Laramie contracts to provide cattle-herding services to Miles for $1,400 per month. Laramie cannot transfer this duty

without continuing to be potentially liable

​Ray agrees to buy one hundred pounds of almonds from Sol. To be enforceable, the agreement must be in writing if the almonds cost at least

$500

Curt enters into a contract with Drivers Lease Company for a three-year lease of a car. This contract is subject to

Article 2A of the UCC

Chet, a minor, signs a contract with Denise, an adult. The contract is voidable at the option of

Chet only.

A condition that must be fulfilled before a party's promise becomes absolute is a condition subsequent.

False

A delegation relieves the party making it of the obligation to perform.

False

A liquidated damages provision specifies that a certain amount is to be paid on a breach of contract when the nonbreaching party elects to receive cash.

False

A right cannot be assigned if the assignment will significantly alter the risks or duties of the obligor.

False

Both intended and incidental beneficiaries acquire legal rights in a contract.

False

Compensatory damages compensate a party injured by a breach of contract by punishing the party that breached the contract.

False

Ordinarily, "Ignorance of the law or a mistaken idea about what the law requires is a valid defense to criminal liability.

False

Ordinarily, the remedy for a seller's breach of a contract for a sale of real estate is damages.

False

Under the "partial performance" exception to the UCC, an oral contract for goods worth more than $500 is enforceable if the goods are designed to partially perform a specific function.

False

Under the UCC, if a contract for a sale of goods does not specify the quantity, a court will objectively determine what is a reasonable quantity.

False

When a change in the law renders the performance of a contract illegal, the nonperforming party is normally held in breach of contract.

False

​The most common way to discharge contractual duties is by breach of contract.

False

Berry enters into a contract with Clyde for a guided tour of Deep Canyon. Clyde represents that he is an experienced, knowledgeable guide, when in reality he has never been in the canyon. Berry is most likely a victim of

Fraud

Guido and Hal want to rescind their contract under which Guido sold Hal a mountain bike for $100. To rescind the contract

Guido must return the $100 and Hal must return the bike

Rudy files a suit against Shakes & Shingles, Roofing Contractor, Inc., under the doctrine of promissory estoppel. Rudy must show that

He justifiable relied on Shakes and Shingles' promise to his detriment

Leon contracts to install automatic watering troughs in Kendall's dairy barn. Leon then becomes seriously ill and contracts with Jake to install the troughs. Jake is unreliable and never shows up to install the troughs. Kendall can sue

Jake or Leon

Bob wants to sell his recreational vehicle (RV) for $21,000. He e-mails Curt with an offer, but mistakenly types that the price is $20,100. Curt accepts the offer and pays Bob $20,100. Bob

Must deliver the RV

Ross promises to pay Sara, his niece, $5,000 if she obtains her degree at Tech University, where she is in her third year. Sara graduates. Ross is

Required to pay because sara obtained a degree at Tech

Ossie enters a convenience store and points a gun at the clerk Pico. Ossie forces Pico to open the cash register and give him all the money. Ossie will most likely be charged with

Robbery

Ray promises to give steve his iPod in exchange for Steve's promise to pay Ray $50. Later they exchange the device for the funds. A contract was created when

Steve promised to pay Ray for the iPod

Ben makes an appointment for a $50 haircut, buys a bike for $250, and agrees to work for Coding Associates for one year for $5,000 per month, starting at the beginning of next month. To be enforceable, a writing is required for

The employment agreement.

A contract entered into under undue influence is voidable.

True

A novation occurs when there is a substitution, by agreement, of a new contract for an old one, with the rights under the old one being terminated.

True

A party seeking to recover in quasi contract must show that the other party has been unjustly enriched.

True

A transfer of contract rights to a third party is an assignment.

True

After a contract is made, a supervening event may make performance impossible and discharge the contract.

True

All states require certain types of contracts to be in writing.

True

An "assignment of all rights" creates an assignment of rights and a delegation of duties.

True

Consequential damages are foreseeable damages that arise from a party's breach of a contract.

True

Contract duties are not assigned—they are delegated.

True

If no time for performance is stated in a contract, a reasonable time is implied.

True

The most common remedies available to a nonbreaching party include damages, rescission and restitution, and specific performance.

True

To be characterized as a "good" under the UCC, an item of property must be movable.

True

UCC Article 2 applies to sales transactions between all buyers and sellers.

True

When the dominant party in a fiduciary relationship benefits from that relationship, a presumption of undue influence arises.

True

Fresh Service, Inc., offers to deliver produce to Growers' Market's customers for a certain price. Fresh's intent to extend a serious offer to Growers' Market is determined by reference to Fresh's

Words and conduct