BLS Chapter 8

Anthony offers to sell a computer to Salvador for $900 if Salvador replies by e-mail only, sent no later than noon on Saturday. On Saturday, Salvador is unable to access his e-mail, so he mails an acceptance at the post office before noon. Which of the following is true of the situation?

A legal contract does not exist since the mode of acceptance specified in the offer was not used

Anthony offers to sell a computer to Salvador for $900 if Salvador replies by e-mail only, sent no later than noon on Saturday. On Saturday, Salvador is unable to access his e-mail, so he mails an acceptance at the post office before noon. Which of the following is true of the situation

A legal contract does not exist since the mode of acceptance specified in the offer was not used.

A cost-plus contract is one in which the market price is determined by references to the price of goods on a specific date

False

A merchant's firm offer for the sale of goods can exceed three months in duration

False

A merchant's firm offer for the sale of goods can exceed three months in duration.

False

A newspaper advertisement addressed to "Ohio residents only" would be a private offer

False

A unilateral mistake offers each party the right to rescind the contract

False

An e-contract must have additional consideration to be as valid as a paper contract.

False

During a lunch with Russell, Josephine offers to sell Russell her car for $5,000. Russell rejects her offer during the lunch, but the next day, before Josephine has taken any additional action, Russell calls her to say, "I've changed my mind, I'll take the car." An effective contract has been formed, and Josephine must sell Russell her car for $5,000.

False

Foster Aircraft Co. has agreed with the U.S. government to rapidly produce a new fighter aircraft in exchange for specified production expenses and a 10% profit. This is a current market price contract.

False

Henry sends an e-mail to Bernice regarding the sale of his truck to her for a price "to be determined in good faith." Henry has made a valid offer.

False

Omar offers to sell a motorcycle to Adanne for $10,000. Adanne replies, "I will pay $10,000 if you overhaul the engine." Adanne's reply conforms to the mirror image rule's requirements

False

On June 7, Sagan mails an acceptance of Randi's mailed offer to her. The acceptance is received by Randi on June 10. The acceptance is effective upon receipt

False

Teri sends an offer to Morris to sell her car for its Blue Book value. Morris is the offeror

False

Brett offers to dust and vacuum all the rooms in Arlene's apartment for $45. Arlene says she will accept his offer if he lowers his fee to $40. According to the common law of contracts, Arlene has

Made a counteroffer

____________ occurs when one party does not say something about certain facts that he is under an obligation to reveal

Passive Fraud

____________ occurs when one party does not say something about certain facts that he is under an obligation to reveal.

Passive fraud

Mercedes receives a box of unordered office supplies in the mail. What is her legal obligation?

She may consider it a gift

Silas, very angry because his new car broke down, yells out "Anyone wanna buy a piece of junk for $100?" Ida overhears Silas and says, "I do, here's $100." What result?

Silas need not sell his car for $100, since he was clearly angry

Booksellers, Inc. makes a written offer to sell Smallville City Library 20,000 books at $5 each. In writing, Booksellers also agrees to keep the offer open for sixty (60) days. However, before the 60 days have passed, Booksellers sells all the books to Universal Library for $7 each. Which of the following is true of this situation?

Smallville can file a legal claim, since Booksellers agreed to hold the offer open, even though no consideration was given.

A "click-on" acceptance is a valid method of accepting an e-contract

True

A condition subsequent is one in which the parties agree that the contract will be terminated when a prescribed event occurs or does not occur.

True

A lease option permits a party to lease real property while at the same time holding an option to purchase that property

True

According to the UCC, a contract for the sale of goods comes into existence when any reasonable means under the circumstances is used to communicate the acceptance

True

Acorn Outfitters advertises a large tent, usually selling for $250, to be sold to the first customer the next morning for $25. Samuel is the first in line, but Acorn claims that the tent has already been sold. Acorn has engaged in a bait-and-switch confidence game

True

An option contract holds an offer open for an agreed period of time

True

An option contract holds an offer open for an agreed period of time.

True

Leo offers to sell his ranch to Iris for $500,000, but before Iris accepts, Leo dies. Leo's heirs have no obligation to honor the contract

True

The Uniform Computer Information Transactions Act (UCITA) covers diverse areas, such as database contracts and software licensing agreements.

True

Soft Feet, Inc. manufactures shoes. Walk Style, Inc. is a retailer of shoes. Soft Feet offers to sell Walk Style 1,000 pairs of shoes at $5 per pair with delivery to be made by October 31. Walk Style accepts, but writes in the margin "delivery to be made by October 20." According to the UCC, what is the legal status of Walk Style's October 20 delivery date?

Under the UCC, the writing binds Soft Feet, unless it objects.

____________ occurs when the dominant party in a special relationship uses excessive pressure to convince the weaker party to enter into a contract that greatly benefits the dominant party.

Undue influence

Rosa sends an offer to Kellen that requires acceptance to be made by U.S. mail. Kellen accepts in a timely manner, but sends the acceptance by FedEx which delivers the acceptance to Rosa two days faster than the U.S. mail would. Under traditional common law rules, has Kellen accepted Rosa's offer?

Yes, since FedEx was faster than the U.S. mail

Matrix Corporation, a computer manufacturer, agrees to purchase from Chipmaster, Inc. all the computer chips that Chipmaster can produce during the next 12 months, at cost plus a twelve-percent markup. Matrix later does not purchase any computer chips during the 12 months year. Can Chipmaster enforce the agreement made with it

Yes, this is an enforceable output contract

When forming online contracts, ____________ is a cyber-technique that preserves electronic data of offer and acceptance without using local hard drives and flash drives

cloud computing

When forming online contracts, ____________ is a cyber-technique that preserves electronic data of offer and acceptance without using local hard drives and flash drives.

cloud computing

According to the E-SIGN Act

e-contracts that are entered into over the INternet will be valid, provided that the parties to the e-contract have agreed that electronic signatures will be used.

According to the E-SIGN Act:

e-contracts that are entered into over the Internet will be valid, provided that the parties to the e-contract have agreed that electronic signatures will be used

Most of the time, an advertisement is specific enough to constitute an offer.

false

While looking for apartments, Brittany finds one that she likes. The building manager agrees to an option contract in which he will hold the apartment for Brittany for four days in return for $100. At the end of the fourth day, Brittany finds another apartment that she likes better and signs a lease with its building manager. Because Brittany's contract with the original building manager is an option contract, the building manager is under

no legal obligation to return Brittany's $100 payment

In a(n) ____________ contract, one party consents to sell to a second party all of the goods that party makes in a given period of time

output

An option contract:

removes the possibility of revocation through death or insanity of the offeror

The first rule of contract interpretation, under the ____________, tells judges that their primary objective in the interpretation of a written contract is to uncover the goals that the parties had when they entered into the contract in the first place

standard construction rule

The first rule of contract interpretation, under the ____________, tells judges that their primary objective in the interpretation of a written contract is to uncover the goals that the parties had when they entered into the contract in the first place.

standard construction rule

Jose agrees to sell his car to Diego for $5,000 if he is accepted to Harvard Medical School. This contract is:

subject to a condition precedent

Jose agrees to sell his car to Diego for $5,000 if he is accepted to Harvard Medical School. This contract is

subject to a condition precendent

Harvey and Myra Church were interested in buying land from Sam and Barb Houston. When the Churches asked about the appraised value of the property, the Houstons said that the appraisals ranged from $185,000 to $198,000. Without looking at any appraisals, the Churches agreed to buy the property for $185,000. After the contract was signed, the Houstons provided an appraisal listing the value as $155,000. When the Churches refused to go through with the deal, the Houstons sued to recover the difference between $185,000 and the lower price for which the house was later sold. The Churches counterclaimed the contract should be rescinded based on their mistaken assumption about the value of the house. The Churches best argument for rescission would be based on:

the active fraud of the Houstons

Harvey and Myra Church were interested in buying land from Sam and Barb Houston. When the Churches asked about the appraised value of the property, the Houstons said that the appraisals ranged from $185,000 to $198,000. Without looking at any appraisals, the Churches agreed to buy the property for $185,000. After the contract was signed, the Houstons provided an appraisal listing the value as $155,000. When the Churches refused to go through with the deal, the Houstons sued to recover the difference between $185,000 and the lower price for which the house was later sold. The Churches counterclaimed the contract should be rescinded based on their mistaken assumption about the value of the house. The Churches best argument for rescission would be based on

the active fraud of the Houstons.

Hazel offers to sell her home to Mandisa for "about $100,000 plus closing costs." Mandisa accepts Hazel's offer, but a dispute arises concerning the precise dollar amount of the purchase price. How will a court resolve this dispute?

the court will declare the purchase price and terms too indefinite to create a binding contract

According to the UCC, a contract for the sale of goods comes into existence when any reasonable means under the circumstances is used to communicate the acceptance.

true

In the case of an open offer, there must be serious intent, clear and reasonably definite terms, and communication to the offeree.

true

A mistake by only one of the parties is called a ____________ and ____________ offer sufficient grounds for rescission or renegotiation

unilateral mistake; does not

Highflight Foundation offers $1 million to the makers of the first private spacecraft to fly to the moon and back. Spaceview, Inc. succeeds in producing the first private spacecraft to fly to the moon and back, but Highflight refuses to pay. This is a ____________ contract and Highlight is ____________.

unilateral; bound because Spaceview performed the required action, which was an acceptance of the offer