Law Exam 2 practice questions part 2

Jason's mother would like him to go to college, so in June he enrolls at State University. He also quits his job and tells his mother his plans to continue taking classes. His mother says, "I'm so happy that you are going to college that I want to pay for your books." Jason then sends her a bill for $485. Which of the following is true regarding his mother's promise?

It is unenforceable, because Jason had already enrolled in school and there is no consideration.

Nell gives Al $50 in return for Al's promise to defame Sara. Nell hopes to ruin Sara's chances at a promotion. Nell finds out that Al did not hold up his end of the agreement. Which of the following statements are true?

Legally, Nell can neither get the money back nor force Al to do as he promised.

Mark paid off his brother Steve's debt to the loan shark on condition that Steve wouldn't be contacted by the loan shark for payment. The loan shark says that he doesn't have to honor that promise because Steve didn't pay. Mark would help his cause by accurately pointing out which of the following to the loan shark?

Mark's payment to the shark was a legal detriment to Mark

Nancy, who lives in Birdville, wants to open a McHenry Roast Chicken franchise. Mark, a representative of McHenry, told Nancy, "If you will buy a lot and build a building in River City, we will give you a franchise." Nancy bought the lot and built the building as instructed, only to discover that McHenry had awarded the franchise to a large corporation. McHenry claims no liability to Nancy since there was no consideration. Which statement is most accurate?

McHenry is liable to Nancy based on the concept of promissory estoppel.

Andrew owns a store in Polk County. His trade extends throughout River City, but not beyond the county limits. He sells his store to Betty and, as part of the transaction, agrees not to engage in the same business anywhere in River City for a period of five years.

The geographic restraint is reasonable.

Mary agrees to sew Georgia's prom dress for $50 plus costs. Georgia decides that she wants ruffles around the neck and calls Mary who says it will now cost $60. When Mary finishes the dress (with ruffles), Georgia must pay:

$60, since the modified agreement is supported by additional consideration.

Doug obtains an exclusive franchise to sell widgets for the Acme Widget Company. The exclusive franchise covers the entire State of Wisconsin for a period of three years.

-Both (a) and (b). -Acme is obligated to use its best efforts to supply the goods even if no such clause appears in the written franchise agreement, According to the UCC, unless otherwise agreed, Doug must use his best efforts to promote the sale of the widgets in his territory.

Barbara, a wealthy widow, promises the pastor of her church that she will donate $10,000 to the church to help pay off its mortgage if the stewardship committee can obtain enough pledges for the balance of the $30,000 mortgage. Other pledges are obtained to pay off the mortgage, but now Barbara has changed her mind and plans to take an around-the-world cruise instead.

-Both (a) and (c). -The promise to pay $10,000 is a promise to give a gift and is therefore not enforceable, Under the Restatement, Barbara's promise is enforceable.

Andrew owns a store in Polk County. His trade extends throughout River City, but not beyond the county limits. He sells his store to Betty and, as part of the transaction, agrees not to engage in the same business anywhere within the state for a period of three years.

-Both (b) and (c). -The agreement is unreasonable, The agreement unduly interferes with the interests of the public.

Darla offers to pay Edward $6,000 for Edward's car, provided that Darla receives that much from her uncle's estate, which is currently being probated. She expects to know for sure how much she will receive within a week or so.

-Both (b) and (c). -The consideration moving from Darla to Edward is the promise of $6,000 subject to a condition, Darla's conditional promise is sufficient consideration unless Darla knows she cannot receive at least$6,000 from her uncle's estate.

Sarah is working hard on the mayoral campaign of Timothy. She thinks that just a few more votes could win the election, so she promises to pay her friend Violet $50 to register and vote. Violet does so, but Timothy loses the election, and Sarah now refuses to pay.

This agreement is unenforceable and opposed to public policy.

Tyler contracts to build a garage for Wilbur for a price of $6,000. Because of an increase in the cost of labor and materials, Tyler refuses to perform. Wilbur wants the garage, so he agrees to pay an additional $500.

Tyler has given no additional consideration, and under the common law must perform at the agreed upon original price.

Sue owes $5,000 to the First National Bank for a student loan which will come due on January 1 next year. She has been offered a two-year graduate fellowship, but she will not be able to pay the loan back if she accepts the fellowship. The bank manager tells Sue that if she pays $3,000 now, they will forgive the loan. Should Sue accept the offer?

Yes, because the early payment of the loan is consideration that makes the bank's promise binding.

A bank robbery has occurred, and the banker's association has offered a $1,000 reward for information leading to the arrest and conviction of the robber. Several people are claiming to be entitled to the money. Which of them is eligible?

An off-duty deputy sheriff from a county other than the one where the arrest occurred.

Claudia sells her highly successful hair salon to Carl. In the sales contract, Claudia agrees never to open a hair salon in the state. Which of the following best describes this contract clause?

An unenforceable restraint against public policy.

Andrew agrees to paint Betty's house for $500. Two days after he starts the job, he decides that $500 isn't enough money. He refuses to finish the job unless Betty agrees to pay him $100 more. What law applies to this fact situation?

Andrew was already obligated to paint the house. He gives no additional consideration in return for Betty's promise to pay more money.

Don has an employment contract with Dunkirk Ice Cream. He sells ice cream and novelty ice cream products. He has nine children and doesn't make enough money, so he decides to see if Sealtest will hire him, too. "After all," he reasons, "most stores carry four or five different brands." His employment contract prohibits him from competing. If Don sells for Sealtest too, will he be in trouble under his contract?

Yes, it is likely to be enforceable during employment.

Jack moved from New Hampshire to Florida and decided to have an air conditioner installed in his car. After it was installed, Jack received a bill for $1,200. Jack called the dealer and told him he'd never heard of this service costing more than $500. They argued, but the dealer finally agreed to take $900. Is the agreement enforceable?

Yes, there is consideration for the modified amount.

Alice says to Brian, "If I decide to buy a word processor next year, I will buy it from you." This is an example of:

an illusory promise.

William recently sold his successful business to Janice. The contract for the sale contained an unreasonable restriction that did not allow William to open a similar business for fifteen years. The courts would, in this instance,

delete the unreasonable portions of the contract.

Glen, acting as real estate agent for James, sold one thousand acres of land to a buyer in New Orleans. Two hundred acres of the land are in Texas and eight hundred acres are in Louisiana. Glen's commission on the transaction is $15,000. If Glen is licensed as a real estate agent in Texas, but not Louisiana, he is:

entitled to a portion of the commission based on the land sold in Texas.

Divided Parcel Service includes the following on its mailing receipts: "We are not responsible for any damages to packages whether or not through the fault or negligence of our employees. Send packages at your own risk." Mary reads this clause but sends her watch back to Bulova Co. to be repaired anyway. The watch is destroyed when the DPS driver uses the package for a ball and tosses it to his buddy. Mary is:

likely to collect from DPS because it is a common carrier.

John operates a small repair business and is in desperate need of a certain type of building material. He obtains the material from a large corporation, but is charged a grossly unreasonable price and is forced to buy other material he does not need. In view of the buyer's unequal bargaining power and unreasonable terms of the contract, this may be a case of:

substantive unconscionability.

William agrees to drill a well up to 200 feet deep for John's rural cabin. The contract price is $3,000. After drilling 100 feet, William strikes solid granite rock. He talks to John and explains that this is highly unusual for the area and could not have been anticipated at the time of entering into the contract. He offers to get a special drill, but says it will cost him more money, so that he will be unable to complete the project for the agreed price. Because John is anxious to have the well, he agrees to pay William an additional $1,000 to complete the job. However, once the well is finished, he changes his mind and now says he will pay only the originally agreed-upon amount.

The parties have agreed to a substitute contract which discharges the original contract. John is obligated to pay the additional $1,000.

Wayne helped Hank study all night for an important exam. After Hank got an A on the exam, he told Wayne, "I will give you $10 for helping me get a good grade." Wayne said, "Thanks, I'll take it."

There is no contract because there is no valid consideration.