Business Law Unit 3

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When might a contract made by a mentally incompetent person be enforceable? A. The incompetent person signs a second contract affirming that he understands the nature of the contract. B. The incompetent person has a court-appointed guardian, and that guardian is aware of the contract. C. The incompetent person was lucid at the time the contract was made. D. The incompetent person has not been declared incompetent by a court.

C. The incompetent person was lucid at the time the contract was made.

Which of the following represents a unilateral offer? "I will pay you $50 if you mow my lawn." "I will pay you $50 if you promise to trim that tree." "I will pay you $50 for your CD player." "I will pay you $50 for your backpack."

"I will pay you $50 if you mow my lawn."

Courts may award damages called quantum meruit, which means a. "to the letter of the law." b. "as much as he deserves." c. "something for something." d. "let the buyer beware."

"as much as he deserves."

Under the doctrine of quasi contract, a plaintiff may recover in quantum meruit, a Latin phrase that means:

"as much as he deserves."

What phrase explains how a requirements contract can be valid? a. "in good faith" b. "willing to accept the entire quantity" c. "will buy 100 percent of output" d. "no consideration needed"

"in good faith"

Which statement is true about the ability of minors to enter into contracts? A. A minor cannot legally enter into contracts. B. A minor may enter into a contract but must ratify it within one year of the date of the contract. C. A minor may enter into a contract only if the minor has an adult co-signer. D. A minor may enter into any contract an adult can, except for contracts that are expressly prohibited for minors.

D. A minor may enter into any contract an adult can, except for contracts that are expressly prohibited for minors.

Which of the following types of damages is intended to reimburse a plaintiff for his or her losses?

Compensatory

Jack says that he placed an order with InternetSales.com, which did not fill it, causing Jack to lose money. If the order was taken via an e-agent, under the Uniform Electronic Transactions Act (UETA), InternetSales.com can

D. not claim it did not receive the order

Ben and Jerry have an agreement whereby Ben will deliver ice cream for Jerry to all of Jerry's retail customers for the next three years. After delivering ice cream for the first nine months, Ben decides that this is not how he wants to spend his time. Ben does not want to let Jerry down, though, so he contacts his buddy Baskin about delivering the ice cream. To protect Jerry from liability, the contract that the parties need to form to transfer the rights and duties under the contract to Baskin and relieve Ben from all responsibility should be a(n): A. accord and satisfaction. B. delegation. C. rescission. D. novation.

D. novation.

Federal Home Products, Inc. (FHP), is a corporation. The implied powers of FHP are powers necessary to

D. perform all acts reasonably appropriate and necessary to accomplish its corporate purposes

Which of the following relationships generally fails to create an insurable interest? a. Debtor and creditor b. Chief executive officer and corporation c. Doctor and patient d. Husband and wife

Doctor and patient

Paul is entitled to test so long as the test is not designed, intended, or used to discriminate, and its construct validity references measure a psychological trait needed to perform the job.

Dog and Formals. ...........Paul refuses to hire her, telling her that unless he follows the ad, he may be seen as practicing discrimination. Deciding that formal wear is more trouble than dogs, Paul shuts down the formal wear store. Which of the following is true regarding Paul's test for patience?

Her lawsuit was improperly filed because she did not first file with the federal Equal Employment Opportunity Commission and she lacked a right to sue letter.

Dogs and Formals. Paul owns a dog grooming business and needs patient people to work there. ..................Deciding that formal wear is more trouble than dogs, Paul shuts down the formal wear store. Which of the following is true involving Paul's plan to require computer training in high school in order to eliminate older workers?

Common Law

Express and implied contracts, promissory estoppel, and quasi-contract were all crafted, over centuries, by courts deciding one contract lawsuit at a time. Many contract lawsuits continue to be decided using common law principles developed by courts A legal system based on custom and court rulings a system of law based on precedent and customs (civil law) a law established by following earlier judicial decisions

A principal is always liable to third parties who are injured by the negligence or criminal conduct of an agent

False

All covenants not to compete are contrary to public policy and therefore illegal.

False

All gambling contracts in the United States are illegal.

False

What factors make an agreement enforceable under the principle of quasi-contract? Choose 2 answers.

-The enriched party knows about the benefit and keeps it. -One party is being enriched at the expense of the other.

How may an offer be terminated? Choose 3 answers.

-The offeree may make a counteroffer. -An offeror may terminate an offer by revocation. -A reasonable amount of time has passed.

How may a revocable offer effectively be revoked? Choose 2 answers.

-The offeror may withdraw the offer with a clear expression. -The offeror may take an action that contradicts the offer and make that known to the offeree.

What elements are required for an offer to be effective under the common law? Choose 3 answers.

-The offeror must intend to be bound by the offer. -The terms of the offer must be reasonably definite so that all parties understand them. -The offer must be communicated to the offeree.

right-to-sue

A ________ letter is provided to a plaintiff if the Equal Employment Opportunity Commission decides not to sue on behalf of the plaintiff.

An agreement to enter into an agency agreement must be in writing to be enforceable.

False

An employee who is terminated by their employer after intervening to report that a co-worker is being sexually harassed does not have a legal claim of action against the employer

False

An employer who wants to make sure...genetic predisposition

False

2:00 p.m.

A bank may determine that ________ or later is the cutoff hour for handling checks.

substantially impaired

A buyer may revoke acceptance of goods if the buyer can show that defects in the goods have caused their value to be ________.

the perfect tender rule

A common law standard known as ________ requires that the seller deliver goods in conformity with the terms of the contract, right down to the last detail.

Covenants not to compete are not permitted when they involve the sale of an ongoing business.

False

The Family and Medical Leave Act

False

Which of the following is true regarding the protection of "fighting words" under the First Amendment to the United States Constitution?

Fighting words are unprotected speech under the First Amendment.

Applied Products, INC. does business with Beltway Distributors , INC. online. Under the Uniform Electronic Transactions Act, what determines the effect of the electronic documents evidencing the parties' deal? Is a party's "signature" necessary? Explain.

First, it might be noted that the UETA does no apply unless the parties to a contract agree to use e-commerce in their transaction. In this deal, of course, the parties used e-commerce. The UETA removes barriers to e-commerce by giving the same legal effect to e-records and e-signatures as to paper documents and signatures. The UETA it does not include rules for those transactions, however.

is the refraining from an action that one has a legal right to do. If a parent pays his adult child to quit smoking, that is forbearance and is consideration. The adult child has a right to smoke, and giving up that right is valid consideration for the contract.

Forbearance

In which of the following scenarios is a court likely to order reformation of a contract? Select all that apply.

Fraud by one of the parties Clerical error in the contract Mutual mistake by the parties

8.Family and medical leave act

Fred has worked for his employer for 12 years. His mother was diagnosed with cancer. Fred requested time off to care for his mother. His employer refused. Which act is this company violating?

17.Actual

Fred represented Harold in a real estate transaction when Harold sold his property to Nancy. What type of authority does Fred owe Harold?

14.Fiduciary

Fred represented Harold in a real estate transaction when Harold sold his property to Nancy. What type of trust does Harold expect of Fred?

23.Fred

Fred represented Harold in a real estate transaction when Harold sold his property to Nancy. Who is the agent?

15.Harold

Fred represented Harold in a real estate transaction when Harold sold his property to Nancy. Who is the principal?

22.Nancy

Fred represented Harold in a real estate transaction when Harold sold his property to Nancy. Who is the third party?

13.Gratuitous

Fred represented Harold in a real estate transaction, at no cost, when Harold sold his property to Nancy. What type of agency exists?

What statutes prescribe that people in peril who receive voluntary aid from others cannot hold those offering aid liable for negligence?

Good Samaritan

Green Space Energy will have to pay Otto a reasonable price for the one well that was installed.

Which of the following is true regarding the comparative negligence doctrine?

It applies in cases where both the defendant and the plaintiff were negligent.

Which of the following is the MOST accurate statement regarding economic duress? It is never grounds for rescission. It is always grounds for rescission. It is a UCC concept only. It may be grounds for rescission.

It may be grounds for rescission.

A formal contract requires which of the following?

It must be in a special form or be created using a special method. Examples include negotiable instruments.

What does the so called public disclosure or "television test" mean in regard to ethical considerations?

It requires us to imagine that our actions are being broadcast on national television.

fixtures; are

Items attached to real estate that are used for business activities are known as trade ________ and ________ treated as goods under the Uniform Commercial Code.

20.Principal

Jack asked Tammy to sell his car while he was vacationing in the Caribbean. When Tammy agreed to become Jack's agent, she had the power to legally bind Jack to a sales contract. They had a voluntary consensual relationship. Tammy did not receive payment for the service. What term identifies Jack?

19.Gratuitous agent

Jack asked Tammy to sell his car while he was vacationing in the Caribbean. When Tammy agreed to become Jack's agent, she had the power to legally bind Jack to a sales contract. They had a voluntary, consensual relationship. Tammy did not receive payment for the service. What type of agent is Tammy?

Kennedy agrees to sell an expensive painting for Jade, and Jade agrees to pay Kennedy a commission when the sale is complete. Kennedy needs access to the painting so she can take pictures for advertisements. Jade, however, refuses to let Kennedy have access to the painting. If Jade later sues Kennedy for breach of contract for not selling the painting:

Jade will lose because she violated her duty to cooperate with her agent.

James River-Norwalk, Inc., was a paper and textile company that needed a constant supply of wood. James River orally contracted with Gary Futch to supply wood for the company, and Futch did so for several years. The deal was worth many thousands of dollars, but nothing was put in writing. Futch actually purchased the wood for his own account and then resold it to James River. After a few years, James River refused to do more business with Futch. Did the parties have a binding contract? Strategy: If this is a contract for services, it is enforceable without anything in writing. However, if it is one for the sale of goods, it must be in writing. Clearly what James River wanted was the wood, and it did not care where Futch found it.

James River was buying wood, and this is a contract for the sale of goods. With nothing in writing signed by James River, Futch has no enforceable agreement

33.A patent

James protects his new invention by applying for which type of protection?

11.Employer

Jason's Deli hires Sam as a consultant to improve the menu. The CEO assigns the VP of Marketing to assist the consultant. In this scenario, Jason's Deli is the:

Which is NOT an exception to the parol evidence rule?

Jayden wants to present evidence that Jignesh verbally promised he would include the trailer with the boat he sold to Jayden

Which is NOT an exception to the parol evidence rule? Jayden has evidence that Jignesh misrepresented portions of the deal they made and would like to present this evidence to terminate the contract. Jayden wants to present evidence that Jignesh agreed to deliver the boat to Jayden before Memorial Day of next year, but the contract incorrectly states the delivery will take place before Memorial Day 2098. Jayden has evidence that he and Jayden agreed to move back the boat delivery date from the original date in the contract when Jayden discovered a hole and Jignesh agreed to repair it before delivery. Jayden wants to present evidence that Jignesh verbally promised he would include the trailer with the boat he sold to Jayden.

Jayden wants to present evidence that Jignesh verbally promised he would include the trailer with the boat he sold to Jayden.

Acme Co. offers to buy 1,000 widgets from Widget World Co. The written offer provides for 1,000 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. No contract exists. The terms materially alter the original offer. b. A contract exists, but the additional terms are not part of the contract no matter what. c. A contract exists. The additional terms are not material, they are part of the contract. d. No contract exists. The purported acceptance contains additional terms, so it is a counteroffer, which has not been accepted.

A contract exists. The additional terms are not material, they are part of the contract.

For which of the following contracts would a court be likely to grant a remedy of specific performance? Select all that apply.

A contract for the sale of a Picasso painting A contract for the sale of land

What type of breach discharges the nonbreaching party from his or her obligations under the contract?

A material breach

Which statement is true about the ability of minors to enter into contracts?

A minor may enter into any contract an adult can, except for contracts that are expressly prohibited for minors.

Which statement is true about the ability of minors to enter into contracts?

A minor may enter into any contract an adult can, except for contracts that are expressly prohibited for minors.

Which statement is true about the ability of minors to enter into contracts? A minor may enter into any contract an adult can, except for contracts that are expressly prohibited for minors. A minor may enter into a contract only if the minor has an adult co-signer. A minor may enter into a contract but must ratify it within one year of the date of the contract. A minor cannot legally enter into contracts.

A minor may enter into any contract an adult can, except for contracts that are expressly prohibited for minors.

Intoxication

A party under the influence of drugs or alcohol could lack capacity, but these contracts are usually enforced. The contract could be voidable or it could be valid (enforceable) depending on the situation. If the intoxicated party could understand the commitment he or she was making, the contract is enforceable. If the party could not understand the commitment, that party lacked mental capacity and the contract is voidable at the election of the intoxicated party. Again, courts rarely rule intoxication of a party as a cause for lack of capacity.

holder

A party who is in possession of an instrument that is payable to the party or to the bearer of the instrument is known as a(n) ________.

holder

A party who possesses a negotiable instrument payable to that party or to the bearer of the instrument is a ________ of the instrument.

fiduciary

A person in a position of trust and confidence is known as a(n) ________.

Which of the following describes an agent who acts under apparent authority?

A person whose communications and actions...reasonably believe

42.Trademark

A popular company uses the slogan, 'Just Do It.' What term identifies this slogan?

compensation

A principal's obligation to pay an agent for his services is the duty of ________.

certificate of deposit

A promise made by a bank to pay a payee a certain amount of money at a future time is called a ________.

Which of the following is NOT required to establish promissory estoppel?

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

What is not required to establish promissory estoppel?

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

Offer

A promise or commitment to perform or refrain from performing some specified act in the future.

recourse

A right to ________ is the ability of a party to seek reimbursement.

mixed sale

A sales contract that combines goods with services is a(n) ________.

False

A seller may disclaim the implied warranty of fitness for a particular purpose either orally or in writing.

cure

A seller's right to provide conforming goods when nonconforming goods were initially delivered is known as ________.

Which of the following contracts is created when two individuals contract for the purpose of benefitting a third party?

A third-party beneficiary contract

Bilateral Contract

A type of contract that arises when a promise is given in exchange for a return promise. A promise made in exchange for another promise both parties make a promise Example 1.1: one person offers payment for another to act in movie

negotiable instrument

A written document containing the signature of the creator that makes an unconditional promise or order to pay a sum certain in money at either a time certain or on demand is called a ________.

How is a tort defined?

A wrong or injury to another, other than a breach of contract

Which of the following is true about agency relationships?

A&B

intermediary

A(n) ________ bank is a bank other than the first bank and the last bank in the check collection process that receives a transferred check.

endorsee

A(n) ________ is a person receiving an endorsement.

endorser

A(n) ________ is a person who signs an instrument to restrict payment of it, negotiate it, or incur liability.

trustee

A(n) ________ takes over administration of the debtor's estate.

A creditor on a liquidated debt of $1 million may agree to take which of the following from the debtor in satisfaction of that debt? (Choose 2 answers.) A. 100 cents on the dollar B. a horse in exchange for the $1 million that is due C. $500,000 D. a promise by the debtor not to engage in any illegal behavior

A. 100 cents on the dollar B. a horse in exchange for the $1 million that is due

In a contract where there was a bilateral mistake of fact: A. both parties misunderstood a word or term in the contract. B. one party misunderstood a word or term in the contract. C. both parties misunderstood the value of the subject of the contract. D. one party misunderstood the value of the subject of the contract.

A. both parties misunderstood a word or term in the contract.

Regional Investment Corporation (RIC) hires Sam, a real estate agent, to locate investment properties for RIC. Sam learns of a warehouse available for $100,000, buys is himself, and offers it to RIC for $200,000. Under the reasoning of the court case 17.3, Cousins v. Realty Ventures, Inc., Sam

A. breached the agent's fiduciary duties to the principal

Macro Corporation and National Purchasing Company may create an agency agreement

A. by conduct, in writing, or orally

Ann is a businessperson acting as an agent for Business Sales, Inc. (BSI). In an ordinary business situations, Ann

A. can contract on BSI's behalf without further authority or ratification

Which defense is used when the defendant admits the facts are accurate but there are additional facts that the defendant can point to that provide justifiable actions by the defendant?

Affirmative defense

40.U.S. Copyright Office

After finishing his first novel, where will Paul file his application to protect his new book?

36.R within a circle

After registering a trademark, what symbol should be placed by all protected marks?

41.Copyright

After video taping an airplane crash, Allen wanted to protect his rights to the video. What type of protection did he apply for?

What is the term for a person who has been appointed by another person to act on her behalf and in her best interest?

Agent

The UCC deals with unconscionability in a contract by providing that a court may a. refuse to enforce the contract. b. enforce the remainder of the contract without the unconscionable clause. c. limit the application of any unconscionable clause as to avoid any unconscionable result. d. All of these are correct.

All of these are correct.

Which of the following offers are considered to be irrevocable for a given period? a. A writing signed by a merchant offering to hold open an offer for the sale of goods for a stated period. b. Firm offers. c. All of these are correct. d. Option contracts.

All of these are correct.

In order for a novation to be valid, what has to happen?

All three parties must agree to the novation.

Capacity

An ability; potential parties must be adults of sound mind.

principal

An agent is authorized to act for and on behalf of the ________.

an accounting

An agent may demand ________ if the agent believes that he or she is not being properly compensated.

performance

An agent's duty of ________ to the principal includes the agent's obligation to perform the duties as specified in the agency agreement.

Hans and Gretchen enter into a life insurance contract that names their son Erik as the beneficiary. What type of beneficiary is Erik?

An intended beneficiary

Which of the following does not constitute valid consideration?

An invitation to negotiate

What are the types of situations that may qualify as grounds for discharge due to impossibility? Choose 3 answers. A. The price of the subject matter of the contract more than doubles. B. A party to a personal contract dies or becomes incapacitated. C. The subject matter of the contract becomes illegal. D. The specific subject matter of the contract is destroyed.

B. A party to a personal contract dies or becomes incapacitated. C. The subject matter of the contract becomes illegal. D. The specific subject matter of the contract is destroyed.

AAA Auto Sales, Inc., employs BBB collection Company as a collection agent. While repossessing goods from Cathy, one of AAA's customers, BBB intentionally injures Cathy. Cathy can recover from

B. AAA or BBB

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? A. Robert wins; this is an enforceable contract with complete and definite terms. B. Wally wins; this agreement is too indefinite since it does not identify which 40 acres are to be sold. C. Wally wins; the original offer was not intended to be an offer but merely an invitation to negotiate. D. Robert wins; the UCC will decide which 40 acres are to be sold.

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

Which is NOT an exception to the parol evidence rule? Jayden wants to present evidence that Jignesh agreed to deliver the boat to Jayden before Memorial Day of next year, but the contract incorrectly states the delivery will take place before Memorial Day 2098.

Jayden wants to present evidence that Jignesh verbally promised he would include the trailer with the boat he sold to Jayden.

jack mails an offer to Joan that states, "I offer to sell you my car for $2,000. 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? a. Jack has a deal. His offer was intended and contains definite terms. b. Jack has a deal. Joan should have responded saying she is not interested in the car if she didn't want to be bound to the offer. c. Joan is not bound. Generally, an offeree must say or do something to accept an offer. d. Joan is not bound. Ten days is not a reasonable amount of time to consider the offer and accept by mail.

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

34.Copyright

John Grisham protects the rights to his book, The Firm, by filing which document?

38.Patent pending

Jon has invented a new traveling aid and wants to start selling it today. Jon has not received his paperwork from the government. What words should be placed on all the merchandise?

Bryan owns Snow Country, a business that leases out snow cone stands. Kaylee agrees to lease one of the snow cone stands for $500 per month. Kaylee and Bryan sign a written contract that states the monthly lease amount is $5,000. When Kaylee refuses to pay the $5000 for the first month's rent, Bryan sues for breach of contract. If Kaylee tries to introduce evidence in court that shows that the amount stated in the written contract is incorrect:

Kaylee will be allowed to introduce the evidence under the parol evidence rule.

A court is unlikely to enforce the non-compete agreement Kelly and Amber signed because of which of the following clauses? a. All of these are correct. b. Kelly agrees to go into a completely different line of work than Amber. c. Kelly agrees not to work for a competitor for two years. d. Kelly agrees not to work for a competitor within a 10-mile radius of Amber's business.

Kelly agrees to go into a completely different line of work than Amber.

Barb has been a children's day care provider for several years in the small town of Sallton. She has decided to give it all up and move to the big city for excitement and adventure. She sells her business to Ken, agreeing not to open a competing business within five miles of Sallton for a period of nine months. After five months of the big city life, Barb is broke and moves back to Sallton. She opens a small day care business. Ken sues on the non-compete clause. What is the most likely result? a. Barb wins. The agreement is denying her the right to do the only thing she knows how to do. b. Barb wins. The agreement is not enforceable because it is not ancillary to a legitimate bargain. c. Barb wins. The agreement is not reasonable as to time. d. Ken wins. The agreement is enforceable.

Ken wins. The agreement is enforceable.

Kyle is being deployed to the Middle East and will be gone for one year. Kyle asks Delilah to sell his house for him while he is gone. In this arrangement between Kyle and Delilah:

Kyle is the principal and Delilah is the agent.

Which of the following means that a contract cannot be illegal or against public policy?

Legal object

The Family and Medical Leave Act, which mandates that businesses employing more than 50 people provide workers with up to 12 weeks' paid leave for family related affairs such as having a child, is an example of what type of jurisprudence?

Legal realism

What is the difference between legal remedies and equitable remedies for breach of contract?

Legal remedies are monetary while equitable remedies are non-monetary.

A contract for a purpose that causes the parties to violate a law is: A. illegal and voidable. B. illegal and void. C. illegal and dischargeable. D. enforceable as a quasi-contract.

B. illegal and void.

Quik Pizza is operated as a partnership. For tax purposes, Quik Pizza

B. is required to file an information return but is not a tax-paying entity

Tim sent an email to Belinda offering to sell his car to her for $5,000. Belinda texted Tim back offering to pay $4,000 for the car. A valid contract did not exist because: Belinda should have accepted Tim's offer orally. consideration was not present in the negotiations. the contract was not for a lawful purpose. Belinda did not accept Tim's offer; she is still negotiating.

Belinda did not accept Tim's offer; she is still negotiating.

Commercial impracticability

Belinda orders a certain type of hybrid rose for her wedding. A disease sweeps through that type of rose and the florist could only obtain the roses at great cost, if at all. Which of the following is the appropriate term for the florist's best defense?

Which mistake is likely to be voidable?

Bilateral mistake

Walter enters a dentist office and points to a damaged tooth. The dentist, Matt, treats the tooth. If Walter refused to pay and Matt sued: Walter would win as there was no contract. Walter would win because of the UCC. Matt would win; this is an implied contract. Matt would win in quantum meruit.

Matt would win; this is an implied contract.

Which of the following is an extension of negotiation?

Mediation

2.American with Disabilities Act

Megan recently applied for a position at a store in the mall. She has a prosthetic arm. The employer refused to hire her for a sales position. Which act is this company violating?

seniority system, a merit system, or a system that measures earnings by quantity or quality of production

Men and women may be paid different wages under the Equal Pay Act when payment is made pursuant to a ________.

Fred and Wilma enter into a contract for horse riding lessons. Fred accidentally types the price for lessons to be $4.00 each instead of $44.00 each. Wilma wishes to enforce the contract at $4.00 per lesson. Which remedy would be most effective? A. Specific performance B. Injunction C. Reformation D. Rescission

C. Reformation

For a contract to be enforceable, seven key characteristics must be present

Offer Acceptance Consideration Legality Capacity Consent Writing

In an auction, the bidder is:

Offeror

5 years

Once a financing statement has been filed with the correct agency, how long is the statement valid without renewal?

Which of the following are examples of people who do not have the capacity to enter into legally binding contracts?

People under the age of majority, people suffering from mental illness, and intoxicated persons

Breach of contract or warranty, fraud in the inducement, and illegality

Personal defenses to the payment of an instrument include:

Peyton is not required to perform under the contract until the appraisal is complete.

Police Officer Paul apprehends a wanted criminal and then demands the $10,000 reward offered by Crime Stoppers. Which of the following statements is true?

Police Officer Paul is not entitled to the reward because he was under a preexisting duty to make the arrest.

______ unconscionability occurs if a contract is entered into, or a term becomes part of the contract, because of a party's lack of knowledge or understanding of the contract or the terms.

Procedural

A party who claims that he or she could not understand contractual terms because of tiny, hard-to-read print on the back of an agreement and the excessive use of legalese is referring to which of the following?

Procedural unconscionability

What factors are used to judge if consideration is adequate to ensure a fair bargain? Choose 2 answers. Promises must be made with voluntary consent. Promises exchanged may not be a preexisting duty. Consideration must be a promise to pay money. Items or promises exchanged must be of nearly equal value.

Promises must be made with voluntary consent. Promises exchanged may not be a preexisting duty.

Collateral Promises

Promises to pay the debts of another or complete another party's obligations if that party does not perform. This secondary obligation must be in writing, even if the primary obligation is not in writing. For example, Johan borrows money from Beth, but the agreement is not in writing. Johan needs a little more time to pay, and Beth will only allow that if he has someone guarantee to pay if he does not. Although it is not your obligation, you agree to pay the debt if Johan does not. Your agreement with Beth must be in writing.

What is an exception to the statute of frauds

Promissory Estoppel

Which statement is NOT true regarding promissory estoppel?

Promissory estoppel is the only possible remedy for an injured plaintiff in a case with no valid contract.

What is the burden of proof to establish in a criminal case?

Proof beyond a reasonable doubt

Which of the following is the return to its original owner of any property transferred under a contract?

Restitution

3.Unemployment compensation

Robert was fired from his manufacturing job without cause. Which benefit is Robert entitled to receive from this situation?

He is incorrect, because Title VII was amended in 1987 to include pregnancy within its protection.

Surprise Arrival. Gracie was surprised and pleased to find she was pregnant. ........ Which of the following is true regarding Groucho's comment that pregnancy-based discrimination is not covered by Title VII?

Groucho will lose on a defense of bona fide occupational qualification because he will not be able to establish that only non-pregnant employees can perform as servers.

Surprise Arrival. Gracie was surprised and pleased to find she was pregnant. ......... What will be the likely result if Groucho defends on the basis that customers will object to Gracie's condition?

1.Workers' compensation

Ted is a chef. In the kitchen at work, he slipped and fell, breaking his leg. What benefit should Ted receive?

12.Unemployment compensation

Ted worked at a factory that was destroyed by fire. What benefit should Ted receive?

What does the Fifth Amendment's protection against self-incrimination mean?

That a person does not have to be a witness against himself or herself in a criminal case

The Miranda rights provide that a law enforcement officer must inform an arrested individual of which of the following before the officer questions the individual?

That the individual has the right to consult with an attorney before speaking to the office

consideration

The "for-value" requirement for becoming a holder in due course is more stringent that the ________ requirement of ordinary contract law.

The Age Discrimination in Employment Act (ADEA) applies to private employers having ________ or more employees.

The Age Discrimination in Employment Act of 1967 prohibits employers from refusing to hire, discharging, or discriminating in terms and conditions of employment against employees or applicants age ________ or older.

National Labor Relations Board

The ________ interprets and enforces the National Labor Relations Act.

For the imposition of strict liability, which of the following is a condition required of an activity?

The activity is so inherently dangerous that it cannot ever be safely undertaken

At will agreements

This means that the employees are free to quit at any time and the company has the right to fire them at any time, for virtually any reason. Courts routinely enforce at-will contracts. But often a company provides its workers with personnel manuals that guarantee certain rights. The legal issue is whether the handbook implies a contract guaranteeing the specified rights.

A male employee who is paid less than a similarly situation female employee can sue the employer for violating the equal pay act

True

Employment at will means that employees have a right to work and can only be fired if they do something wrong like not showing up work as scheduled

True

Exculpatory clauses release a party from liability in the event of monetary or physical injury no matter who is at fault.

True

If a contract is divisible into legal and illegal portions, a court may enforce the legal portion but not the illegal one, so long as the illegal portion does not affect the essence of the bargain.

True

Software clickwrap and browsewrap 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. a. True b. False

True

Treating someone unfavorable because of skin pigmentation is illegal

True

When one party has no reason to know that a contract is illegal, that party can often recover any benefits conferred in a partially executed contract.

True

An order instrument

Which of the following types of paper requires delivery and an endorsement by the holder?

Implied

Which of the following types of warranties arises by operation of law under certain circumstances?

Specific performance

Which of the following usually requires that the seller deliver the particular goods identified in the contract?

A buyer in the ordinary course of business

Which party routinely buys goods in good faith from a person who routinely sells such goods?

Shelter

Which principle states that if an item is transferred from one person to another, the transferee acquires all the rights that the transferor had in the item?

VII

Which title of the Civil Rights Act of 1964 deals with discrimination in employment?

Writing

While verbal agreements often amount to contracts, some types of contracts must be in writing to be enforceable The terms were in writing (although they did not have to be).

The Tavern's secret recipe for its pizza sauce would be considered a trade secret, and an employment non-compete clause would be enforceable to protect it. a trade secret, but an employment non-compete clause would NOT be enforceable to protect it. just a secret recipe and not something the Tavern could protect in a non-compete clause. an exculpatory clause and not enforceable.

a trade secret, and an employment non-compete clause would be enforceable to protect it.

The Tavern's secret recipe for its pizza sauce would be considered a. just a secret recipe and not something the Tavern could protect in a non-compete clause. b. a trade secret, but an employment non-compete clause would NOT be enforceable to protect it. c. an exculpatory clause and not enforceable. d. a trade secret, and an employment non-compete clause would be enforceable to protect it.

a trade secret, and an employment non-compete clause would be enforceable to protect it.

The Uniform Electronic Transactions Act (UETA) is:

a uniform law proposed by the National Conference of Commissioners on Uniform State Laws to support the enforcement of e-contracts.

Jennifer has offered to sell her laptop computer for $500 to Jack. She tells Jack that the computer is only six months old but, in fact, it is three years old, and Jennifer wants to unload the lemon. Jack agrees to buy the computer based on Jennifer's representations. This contract is: a void agreement because of the fraud involved. a voidable contract, one that Jack can void. a voidable contract, because it is unilateral. a void contract because of the UCC.

a voidable contract, one that Jack can void.

Under the fictitious payee rule, the company will be required to take the loss on the checks unless the company can obtain the funds from Zachary.

Zachary, who has been authorized to write a check from a company account to pay employees, draws bonus checks from the company account for five imaginary employees; he then endorses the checks in their names and deposits the checks into his own bank account. Which of the following is true regarding whether the company will be required to take the loss on the checks?

Indemnification

________ is the right of a principal to sue an agent to recover any amount assessed against the principal for a breach of contract caused by the agent's negligence.

Negotiation

________ is the transfer of possession of a negotiable instrument to a third party who becomes a holder of the negotiable instrument.

void

________ title is not true title.

Courts may award damages called "quantum meruit": a. All of these answers. b. even though there was no valid contract entitling the plaintiff to it. c. which means "as much as he deserved." d. which is money the court believes the plaintiff morally ought to have.

The common law governs contracts for: a. All of these answers. b. employment. c. services. d. real estate.

When the United States president negotiates a treaty as part of his or her executive duties, how many U.S. senators does it take to ratify the treaty to make it binding?

Two-thirds of the Senate

The basic _______ rule requires only a memorandum signed by the defendant, indicating that the parties reached an agreement and specifying the quantity of goods

UCC

A sale

Under Article 2 of the Uniform Commercial Code, which of the following consists of the passing of title from the seller to the buyer for a price?

a sale

Under Article 2 of the Uniform Commercial Code, which of the following consists of the passing of title from the seller to the buyer for a price?

Goods

Under Article 2 of the Uniform Commercial Code, which of the following is defined as tangible things which are movable at the time of identification to the contract for sale?

The burden of proof shifts to the employer-defendant to articulate a legitimate, nondiscriminatory business reason for the discharge.

Under Title VII of the Civil Rights Act of 1964, which of the following occurs procedurally after an employee-plaintiff establishes a prima facie case in an action alleging disparate-treatment discrimination in employment in the form of an illegal discharge?

unconscionable

Under the Uniform Commercial Code, if a contract or a contract provision is so unfair that a court would be unreasonable if it enforced the agreement, the contract is deemed ________.

tangible

Under the Uniform Commercial Code, items are ________ if they exist physically.

$1,000 or more

Under the Uniform Commercial Code, lease contracts that require payments of ________ must be in writing in order to be enforceable.

When dispatched

Under the Uniform Commercial Code, when is an acceptance effective?

when dispatched

Under the Uniform Commercial Code, when is an acceptance effective?

That the nonbreaching seller may claim against a breaching buyer 20 percent of the purchase price or $500, whichever is less, as liquidated damages.

What does the Uniform Commercial Code provide for liquidated damages if the parties do not otherwise agree to them?

No national standard exists for perfecting a security interest in an automobile or a boat.

What is the national standard for perfecting a security interest in an automobile or a boat?

After-acquired property

What kind of property is acquired by the debtor after the security agreement is made?

The Uniform Commercial Code

What law does the judicial system rely on to clarify the obligations of a seller and a buyer if their agreement is unclear?

A common-carrier delivery contract

What type of agreement do contracting parties have when the goods are delivered to a buyer via a common carrier, such as a trucking line?

a conditional sales contract

What type of agreement do contracting parties have when the sale itself is contingent on approval?

Certificates of deposit, stocks, and bonds

What type of collateral must be perfected through possession?

An insurable interest

What type of interest occurs when there is a right to insure goods against any risk exposure such as damage or destruction?

Signature

What type of liability occurs when a person signs a negotiable instrument?

Chattel paper

What type of paper indicates both a monetary obligation and a security interest in specific goods?

The difference between the resale price and the contract price, plus incidental damages and minus expenses saved.

Which of the following damages may a seller receive if the seller resells goods to another buyer when the original buyer is in breach of contract?

Terms the parties outline in agreements, custom, and rules outlined by the Uniform Commercial Code

Which of the following determines the obligations of sellers and buyers?

Real estate, corporate stocks, and copyrights do not meet the definition of a good

Which of the following do not meet the Uniform Commercial Code definition of a good?

Cashier's

Which of the following is a check for which both the drawer and the drawee are the same bank, and the payee of the check is a specific person?

Drawer

Which of the following is a person who orders the drawee to pay?

Walter enters a dentist office and points to a damaged tooth. The dentist, Matt, treats the tooth. If Walter refused to pay and Matt sued, a. Matt would win; this is an implied contract. b. Walter would win as there was no contract. c. Walter would win because of the UCC. d. Matt would win in quantum meruit.

When Gretchen comes home from work one evening, she finds that her yard has been mowed and trimmed. Later, a man comes to collect for the yard work done. Gretchen refuses to pay for the work since she has never seen the man before and did not hire him to do her yard work. Which of the following answers is most accurate? a. Gretchen would not have to pay for the yard work. b. The court would order Gretchen to pay the reasonable value of the yard work because of the benefit conferred on her. c. This is an implied, unilateral contract and she must pay the price requested by the man. d. This is an express, voidable contract that either party may avoid.

Which of the following is an example of an implied contract? a. Alberto visits his physician to be treated for a sinus infection. They do not discuss payment, but the following week Alberto receives a bill from his physician for services rendered. b. Amy tells her neighbor Tom, "If you rake up my leaves, I'll bake you a batch of brownies." Tom accepts the offer. c. Midori offers to sell a necklace to Patricia for $50; Patricia agrees to pay $50 for the necklace. d. Miguel wants to purchase his first home. When he found the perfect place, he signed a contract for purchase and closed on the home within a month.

Which of the following types of property would be goods under the Uniform Commercial Code? a. A computer. b. A patent. c. A contract. d. A share.

An employer may use social media in making hiring decisions, if it is done carefully.

Which of the following is an accurate statement regarding whether an employer may use social media in making hiring decisions?

A termination statement

Which of the following is an amendment to a financing statement stating that the debtor has no obligation to the secured party?

Agency by estoppel

Which of the following is another name for an apparent agency?

Perfection

Which of the following is defined as the series of legal steps a secured party takes to protect its rights and collateral from other creditors who wish to have their debts satisfied through the same collateral?

In a successful suit against a principal, an agent is entitled to contract remedies but not tort remedies.

Which of the following is false regarding a principal's duties to an agent?

If a bank refuses to certify a check, the check is considered dishonored.

Which of the following is false regarding certified checks?

All employees are agents, and all agents are employees.

Which of the following is false regarding the employer-employee relationship?

A liquidated-damage clause is enforceable if it is not punitive in nature.

Which of the following is generally true regarding a liquidated-damage clause?

Expressed agency

Which of the following is the most common type of agency?

A blank endorsement

Which of the following is the payee's or last endorsee's signature and nothing else?

Cover

Which of the following is the right of a buyer to substitute goods for those due under a sales agreement?

Obedience

Which of the following is the term used to describe the duty an agent has to follow the lawful instruction and direction of the principal?

The principal is not bound unless the principal ratifies the contract.

Which of the following is true if an agent has no actual or apparent authority to act on behalf of a principal but the agent still enters into a contract with a third party?

The merchant can transfer all rights in the goods to a buyer in the ordinary course of business.

Which of the following is true if an owner entrusts the possession of goods to a merchant who deals in goods of that kind?

The buyer may inspect the goods and decide whether to a) treat the contract as void or b) ask the seller for a reduction of the contract price and then accept the damaged goods.

Which of the following is true if goods are identified at the time the parties entered into a contract and these goods are partially destroyed through no fault of the parties before risk passes to the buyer?

While no federal law specifically prohibits discrimination based on sexual orientation, some states do have laws prohibiting discrimination based on sexual orientation.

Which of the following is true regarding discrimination based on sexual orientation?

They may be part of a brochure, they may arise from a salesperson's oral promise, and a sample or model may provide an express warranty.

Which of the following is true regarding express warranties?

The Uniform Commercial Code does not define default.

Which of the following is true regarding the Uniform Commercial Code's definition of default?

As a maker, an accommodation party has primary liability, but as an endorser, the accommodation party has secondary liability.

Which of the following is true regarding the liability of an accommodation party?

The mirror-image rule that applies under common law does not apply under the UCC.

Which of the following is true regarding the mirror-image rule and the Uniform Commercial Code?

The trustee may take possession of the debtor's property and have it appraised; if someone else holds the debtor's property, the trustee has the power to require the person to return that property; and the trustee may temporarily take over the debtor's business.

Which of the following is true regarding the rights of a trustee in a Chapter 7 bankruptcy?

The employer has a right of indemnification from the negligent employee.

Which of the following is true regarding the rights of an employer who is held liable and pays a third party not because of the employer's negligence, but under the doctrine of respondeat superior for the negligence of an employee?

There is no federal law prohibiting employers from firing employees who smoke.

Which of the following is true regarding the rights of employees who smoke?

The principal cannot be held liable unless the principal's name is on the instrument or the agent's signature indicates that it was made in a representative capacity.

Which of the following is true under the Uniform Commercial Code regarding the liability of a principal to an agent if the agent enters into a contract that is a negotiable instrument?

Demonstrate good faith in obtaining the substitute goods, pay a reasonable amount for the substitute goods, act without unreasonable delay in purchasing the substitute goods, and purchase goods that are reasonable substitutes.

Which of the following must a buyer do in obtaining cover?

Reacquisition

Which of the following occurs when a former holder of an instrument has the instrument transferred back to him or her by negotiation or other means?

Farmers, ranchers, and nonprofit organizations

Which of the following parties cannot be forced into involuntary bankruptcy under Chapter 7?

Which of the following represents a unilateral offer?

U.S. dollars, English pounds, euros, or Japanese yen

Which of the following satisfies the currency requirement for negotiability in the United States?

3-302

Which of the following sections of the Uniform Commercial Code establishes the four requirements for becoming a holder in due course?

On behalf of Bobble Head Manufacturing Company, Carmela types her name at the bottom of an e-mail purchase order and submits the order to Designer Parts Company. Under the UETA, Carmela's typed name qualifies as

a "signature"

contract

a binding agreement between two or more persons that is enforceable by law

Uniform Commercial Code (UCC)

a comprehensive statutory scheme that includes laws that cover aspects of commercial transactions A collection of laws that governs various types of business transactions. recognized as the most important statute in business law, it includes provisions which regulate certain sales of goods and negotiable instruments the body of laws governing commercial transactions in the US.

Which of the following types of property would be considered "goods" under the Uniform Commercial Code?

a computer

A partially integrated contract means:

a contract contains only some terms, to which the parties agree but not others.

An example of a void contract would be:

a contract formed for an illegal purpose. If the purpose of a contract is illegal, the contract will generally be deemed void.

Twyla's dock is damaged in an accident caused by Ulric's negligence. Twyla agrees not to sue him if he will pay for the damage. If Ulric fails to pay, Twyla can bring an action for breach of contract. This agreement is

a covenant not to sue

An unliquidated debt can be described as a. a debt in which both its existence and amount is in dispute. b. a debt undisputed by either party. c. a debt in which the existence or amount is in dispute. d. a debt disputed by the creditor but not the debtor.

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

A quasi contract may be defined as:

a fictional contract. A quasi contract is not an actual contract; rather, it is a legal fiction created in order to avoid some unfairness or injustice.

As it pertains to consideration, which of the following constitutes value? a. an illusory promise b. a preexisting duty c. All of these are correct. d. a forbearance

a forbearance

Which of the following are generally considered to be legal offers? a. catalog advertisements b. placing an item up for auction c. price lists d. a note scribbled on a restaurant napkin that includes the details of the offer

a note scribbled on a restaurant napkin that includes the details of the offer

If someone provides a service that he or she is already obligated to do, it is an example of

a preexisting duty.

Which of the following is legally sufficient consideration?

a promise to do a legal act forbearance of a legal act

Which of the following is legally sufficient consideration? Choose 2 answers.

a promise to do a legal act forbearance of a legal act

In a bilateral contract, the consideration which supports the forming of the contract is:

a promise to perform

What type of contract is a possible remedy for an injured plaintiff in a case with no valid contract, when the plaintiff can show benefit to the defendant, reasonable expectation of payment, and unjust enrichment? a. an implied contract b. an express contract c. a unilateral contract d. a quasi-contract

a quasi-contract

If an individual shopping for groceries opens a bottle of water from their cart and drinks it before they have paid for their items:

a quasi-contract has been created.

Filomena offers to sell Rhonda her collection of rare books. Before Rhonda even has a chance to accept, Filomena says, "Sorry, I changed my mind, no deal." This is an example of:

a revocation. Filomena withdrew, or revoked, the offer.

Iggy tells Jade, "I might sell the snowboard that I bought this winter since I haven't used it and the season is almost over." This is

a statement of future intent

An express contract: a. is not valid in any state. b. has both parties setting forth their intentions. c. must be in writing. d. must not only be in writing, but be handwritten.

The elements of a contract are: a. agreement, consideration, due process. b. agreement, consideration, legality, and capacity. c. dispute, consideration, legality, capacity. d. dispute, resolution, closing statement.

Tucker enters a dentist office and points to a damaged tooth. The dentist, Mike, treats the tooth. If Tucker refused to pay and Mike sued: a. Mike would win in quantum meruit. b. Mike would win; this is an implied contract. c. Tucker would win as there was no contract. d. Tucker would win because of the UCC.

What evidence outside of the written contract is a party allowed to present? Choose 2 answer choices. a Verbal negotiations leading to the signing of the contract b Evidence showing a change to the contract after it is signed c Evidence to prove agreement on an essential element of the contract d Evidence showing an agreement that is different from the contract that the parties agreed to before the contract was signed

b Evidence showing a change to the contract after it is signed c Evidence to prove agreement on an essential element of the contract

Ruby, a seventeen-year-old, purchases a car from Smitz Used Auto Sales and agrees to pay for it over a period of twenty-four months. Ruby makes the payments for four months but then decides the car payment is too much for her limited budget. Ruby tells Smitz that she wants to stop making payments and that she wants out of the contract completely. The contract between Ruby and Smitz can be canceled by: a Smitz or Ruby, because Ruby is a minor, and Ruby may keep the car. b Ruby, because she is a minor, but Ruby must return the car. c Smitz, because Ruby is a minor, but Smitz must allow Ruby to keep the car. d Ruby, because she is a minor, and Ruby may keep the car.

b Ruby, because she is a minor, but Ruby must return the car.

Elle is an agent for Fresh Food Corporation. Elle makes a misrepresentation when entering into a contract on behalf of Fresh with Gala Grocery Stores, In. Gala

b. may rescind the contract

A restaurant owner requires new employees to sign a covenant not to compete in the restaurant business in the entire United States for five years. Such a covenant will

be deemed contrary to public policy because of excessive duration and unreasonable geographic restriction

What element of a contract refers to both parties receiving some measurable benefit? a. legality b. consent c. consideration d. capacity

Which of the following represents a unilateral offer? a. Tyrone, a men's clothing store owner, signs a contract with one of his suppliers that says he will only buy shirts from that supplier exclusively. b. Kris agrees to buy Tony's old iPod but then changes her mind. c. Aisha loses her diamond ring at work, offers a $50 reward for its return, and Jason finds the ring and collects the reward. d. Bobby and Billy notice fliers around their neighborhood offering $50 for the return of a lost cat so they go looking for the cat.

One of the factors leading courts away from a laissez-faire approach to contract law was: a. the assumption that parties had freedom to contract and would have to live with the consequences. b. the assumption that promises are not legally binding. c. the movement away from requiring a writing and a signature on contracts. d. a change in relative bargaining power between parties to contracts.

One purpose of contract law is: a. None of these answers. b. to make deals easier to get out of. c. to make business more complicated. d. to make business matters more predictable.

Which of the following represents a unilateral offer? a. "I will pay you $50 for your CD player." b. "I will pay you $50 if you promise to trim that tree." c. "I will pay you $50 for your backpack." d. "I will pay you $50 if you mow my lawn." Hide Feedback

Marie and Molly enter into a written contract to sell Marie's home to Molly. At the time the contract is executed, Marie tells Molly that for the last six months she has been sharing the home with a family of extraterrestrial beings. Marie states that she has asked the extraterrestrials to move out, but they won't; therefore, she is selling the family home to get rid of them and is willing to sell the home to Molly for well below market price. After the sale of the home is complete, Marie's children challenge the sales contract on the grounds that Marie did not have the mental capacity necessary to enter into a contract, even though Marie has not been declared incompetent by the courts. The contract between Marie and Molly can be rescinded:

d if Marie's children can prove that Marie lacked the mental capacity to comprehend the nature, purpose, and consequences of the contract.

Orb, Inc., does business online around the globe. The United Nations Convention on the Use of Electronic Communications in International Contracts and other international agreements improve global commercial certainty by

determining an Internet user's location for legal purposes

Fletcher signs a contract to buy a new electric guitar and amplifier just before reaching the age of majority. After reaching the age of majority, Fletcher does not take possession or make payments. With respect to the contract, most courts would hold that this qualifies as

disaffirmance

the legal avoidance, or setting aside, of a contractual obligation

disaffirmance

If a legal contract is formed and the subject of the contract then becomes illegal under a new statute, the contract is _____.

discharged

After filing the initial pleadings and motions, the parties gather evidence through a process known as _____.

discovery

Miller signed an employment contract containing an arbitration clause stating that "any dispute" arising during employment must be resolved by binding arbitration. Two years later, after she was injured on the job and took leave to recover, she was fired. She filed a complaint for disability discrimination with the Equal Employment Opportunity Commission, which gave her a "right to sue" letter. She then filed suit in federal court against her employer for disability discrimination. The court

dismissed the suit because of the arbitration agreement

Regarding consideration, an act occurs when a person a. complies with the law. b. does something not legally required. c. All of these are correct. d. fulfills an obligation under an existing contract.

does something not legally required.

Francisca and Garden Estate, Inc., enter into a contract for the use of a Victorian mansion and its grounds for a wedding and reception. If ambiguities appear in the contract, they will be construed against the party that

drafted the contract

An improper threat made to force another party to enter into a contract

duress

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

duress

Ralph and Lydia plan to be married soon, so Ralph drafts a prenuptial agreement for them. Lydia reviews the prenuptial agreement and decides that everything looks fine. Lydia signs the prenuptial agreement electronically using Adobe E-Signature. After Ralph and Lydia have been married for two years, Ralph sues Lydia for divorce. Ralph wants to enforce the terms of the prenuptial agreement, but Lydia objects. Lydia's best argument for invalidating the prenuptial agreement is that:

e-signatures cannot be used on prenuptial agreements.

Beth, who is sixteen years old, enters into a contract with Waldo, who is eighteen years old, for the sale of a car. Vern, who is nineteen years old, enters into a contract to load and unload a truck for Spencer, who is twenty-one years old. In almost all states, the age of majority for contractual purposes is

eighteen years

What types of contracts violate public policy? Choose 3 answers.

employment contracts that forbid membership in a union conducting trade with a country that is an enemy to the United States a candidate for public office paying his competitor to retire

What types of contracts violate public policy? Choose 3 answers. employment contracts that forbid membership in a union a candidate for public office paying his competitor to retire a contract to allow a political candidate exclusive use of billboards you own conducting trade with a country that is an enemy to the United States

employment contracts that forbid membership in a union a contract to allow a political candidate exclusive use of billboards you own conducting trade with a country that is an enemy to the United States

assume Mario orally promised Josephina that if she helped him win the following week's state lottery, she would share the proceeds equally with him. Josephina agreed to purchase the tickets in Mario's name using Mario's money, but she selected the lottery numbers, and prayed for divine intervention to help them win. Mario won $30 million in the lottery, to be paid in a lump sum, or over a 10-year period. When Mario failed to share any of the winnings, Josephina sued in a state court for breach of contractual obligation. Mario contended the oral agreement was unenforceable under the Statute of Frauds because the contract could not possibly be performed within one year. In this case, however, a court would likely hold the agreement ________

enforceable

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 a. unenforceable due to the difficulty of devising an appropriate remedy for a breach. b. unenforceable due to its vagueness. c. enforceable as long as both parties act in good faith and Bob doesn't suddenly demand more hay than what was reasonably estimated. d. unenforceable unless state real estate law makes an exception.

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

Bailey is an accountant who is not licensed to practice her profession in Connecticut. Connecticut requires accountants to be licensed only to raise revenue. This contract is most likely

enforceable by Bailey and Douglas

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 a. unenforceable illusory contract. b. enforceable requirements contract. c. enforceable output contract. d. unenforceable promise based on past consideration.

enforceable requirements contract.

An agreement between two parties to pay a lesser amount to settle an unliquidated debt is a. unenforceable, as there is no consideration. b. enforceable, as there is consideration. c. enforceable in only some states. d. unenforceable as a violation of public policy.

enforceable, as there is consideration.

A contract provision that attempts to release one party from liability in the event the other is injured

exculpatory clause

A statement releasing one of the parties to an agreement from all liability, regardless of who is at fault or what the injury suffered is, would be referred to as a(n) _____.

exculpatory clause

At age seventeen, Mallory enters into a contract with Fit Health Clubs, Inc. Two years later, when Mallory attempts to disaffirm the contract, Fit files a suit against her. The court will most likely consider the contract ratified if it is

executed

Ike and Jeff agree that Ike will tutor Jeff in math for $25.00 an hour. Ike tutors Jeff for an hour and Jeff pays Ike $25.00. This is a(n) _____ contract.

executed

When party A and B form a contract and both parties fully perform, the contract is considered:

executed

Quon and Bert have signed a contract for Bert to mow Quon's grass every week in June, July, and August for a price of $40 per week. They have agreed to all the necessary terms, but Bert has not yet mowed because it is still May. What type of contract do they have?

executory

Thomi told Belinda that if she did not pay him $10,000 by the week's end, he would take incriminating documents he has against her to the local police. This type of behavior is known as _____.

extortion

Mia contracted with Greencare Lawn Service for a pest treatment on Mia's lawn for $1,000. Pat lives next door to Mia. Greencare mistakenly treats Pat's lawn instead of Mia's. Pat watched them perform the treatment while looking through the window of his living room, but did not go outside and stop them. When Greencare seeks payment from Pat, Greencare can probably receive:

from Pat an amount less than the contract amount that will reimburse Greencare for expenses incurred, in order to avoid unjust enrichment.

may occur when an unexpected event renders a contract completely useless to one party

frustration of purpose

An unconscionable contract is one that a court refuses to enforce because of a. fundamental unfairness. b. overt vagueness. c. illegality. d. its limit to free trade.

fundamental unfairness.

_________ performance is required in all contracts

good faith

An exculpatory clause is generally unenforceable when: it attempts to release a party from liability for ordinarily negligent behavior. it involves public transportation. it is written clearly and in bold, large print. the affected activity is a recreational activity.

it involves public transportation.

A contract most likely will be declared unconscionable if a. it is signed by a minor for an item of luxury. b. it contains a cancellation clause. c. it allows for an extremely high rate of interest to be charged. d. it is oppressive and one-sided.

it is oppressive and one-sided.

Consent

permission for something to happen or agreement to do something. There was no fraud or trickery on the part of the restaurant (the terms were clear, not buried so that Chris was unaware of them).

Minors

person under the age of 18 years minors lack legal capacity to contract. Still, a minor can enter into a contract, unless the particular activity or subject matter of the contract is prohibited by law. Contracts with minors are voidable by the minor, but not by the non-minor party. This means the minor has the option to choose to cancel the contract or to continue with it. If the other party is not a minor, that other party is bound by the minor's decision.

Which of the following terms means that past decisions guide future decisions?

precedent

The doctrine of _____ allows that if the state and federal government have concurrent authority, the federal government has the right to regulate in that area exclusively.

preemption

a neighbor could not say to you he will agree to keep his violent dog in the house or otherwise restrained if you give him $1,000 if local ordinances require that anyway describes what?

preexisting duty

Unilateral Contract

promise in exchange for an act A contract that results when an offer can be accepted only by the offeree's performance. a. Example 1.1: When the actor finishes acting in the movie and gets paid by producer, the contract is fully executed.

Which of these types of contracts must be in writing under the requirements of the Statute of Frauds?

promises made in consideration of marriage collateral promises to pay the debt of another person contracts for the sales of land

Which of these types of contracts must be in writing under the requirements of the Statute of Frauds? Choose 3 answers. promises made in consideration of marriage contracts for the sale of goods priced at $1,000 or more contracts for the sales of land collateral promises to pay the debt of another person

promises made in consideration of marriage contracts for the sale of goods priced at $1,000 or more collateral promises to pay the debt of another person

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.

Aunt Mae promises to leave farmland to Jamie in her will if Jamie does not move away and if he helps Aunt Mae with the farm as she ages. Jamie gives up a good job opportunity in a distant city to stay with Aunt Mae and work on the farm, yet Aunt Mae leaves her entire estate to be split among all of her living relatives. Here, a court could find in Jamie's favor under _____________?

promissory estoppel

What is an exception to the statute of frauds?

promissory estoppel

What are the two most common settings for legitimate non-compete agreements? a. sale of a business and real estate purchase b. real estate purchase and employment relationship c. sale of a business and employment relationship d. real estate purchase and insurance purchase

sale of a business and employment relationship

When an accord and satisfaction is at issue, the _____ is the debtor's payment of the reduced amount.

satisfaction

A search is unreasonable if the government official conducting the search does not first obtain a _____ from a court.

search warrant

A(n) _____ contract contains multiple parts that can each be performed separately.

severable

What factors may cause a person to lack contractual capacity? Choose 3 answers.

severe intoxication mental incompetence being under the age of majority (usually 18)

What factors may cause a person to lack contractual capacity? Choose 3 answers. being an emancipated minor severe intoxication being under the age of majority (usually 18) mental incompetence

severe intoxication being under the age of majority (usually 18) mental incompetence

Leilani enters into a contract with Metro Taxi Company to work as a cabdriver. Under the plain meaning rule, if the contract's writing is clear and unequivocal, the meaning of the terms must be determined from

the ordinary meaning of the contract terms

If the terms of a contract are clear and unambiguous, a court may not consider extrinsic evidence (any evidence not contained in the contract itself) when interpreting the document. This is known as:

the plain meaning rule, excludes extrinsic evidence from consideration when the contract terms are clear and unambiguous.

A quantum meruit remedy is equivalent to:

the reasonable value of the agreement.

Article 2 of the UCC governs

the sale of goods

A forum-selection clause indicates:

the specific court in which arbitration proceedings will be held.

Express Contract

the two parties explicitly state all important terms of their agreement. A contract in which the terms of the agreement are fully and explicitly stated in words, oral or written.

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 a. 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. b. the warranty term is an "additional term" that becomes part of the contract in most states. c. the warranty term is a "different term," which in most states becomes part of the contract unless the seller promptly objects. d. no contract can be created

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 a. the assumptions of the offeror. b. the words and conduct of the offeror. c. the beliefs of the offeror. d. the subjective intention of the offeror.

the words and conduct of the offeror. c. the beliefs of the offeror.

Implied Contract

the words and conduct of the parties indicate that they intended an agreement. A contract formed in whole or in part from the conduct of the parties. a contract that comes about from the actions of the parties

Jerome enters into a contract with Kate's Catering Service for the delivery and serving of hors d'oeuvre, dinner, and dessert at a regional accountancy conference. In a later dispute between these parties over the service, the doctrine of quasi contract cannot be used because

there is an actual contract covering the matter in controversy

A liquidated debt is one in which a. the debtor is unable to pay. b. there is disagreement about the amount owed. c. there is no dispute about the amount owed. d. the parties dispute whether any money is owed.

there is no dispute about the amount owed.

This kind of clause generally makes a contract date strictly enforceable:

time of the essence

One of the main purposes of contract law is:

to ensure that certain promises made among private parties are enforced.

Courts may reform a contract:

to reflect the parties' true intentions.

You read in a catalogue about a great new laptop computer that you would love to have and see that the computer is priced so that you can afford it. If you call the company to place an order and are told, "Sorry, we're all out!" you may:

try somewhere else; this is not an effective offer. The catalogue is not legally responsible for your disappointment because its advertisement was an invitation to negotiate, not an offer.

A contract is a legally enforceable agreement between

two or more parties

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 lose, as he agreed to not hold the lawnmower manufacturer liable. lose, as he assumed the risk. win, as this warning would be unenforceable. win, as all lawnmower manufacturers are strictly liable.

win, as this warning would be unenforceable.

In the historic case of Hamer v. Sidway, the nephew a. won, as there was a completed gift. b. won, as the Court found there was consideration. c. lost, as the Court found there was no consideration. d. lost, as the uncle was dead.

won, as the Court found there was consideration.

Rachel tells Stan that she will sign a contract to retain his services as tech support for one year if the contract includes a clause to extend the term at the same price. Rachel's intent to sign the contract is determined by reference to her

words and action

Mens rea means _____.

wrongful state of mind

Promissory estoppel requires the following:

· a clear and definite promise by the defendant · the plaintiff relied on that promise, to their detriment · the defendant knew the plaintiff would rely on the promise · the only way to avoid injustice is to enforce the promise The burden of proof is on the plaintiff to show a promise existed by connecting her actions, or non-actions, to the reality of a promise made by the defendant. And based on that reality, she incurs a legal detriment.

What type of contracts arise not from words, but instead from the conduct of the parties?

Implied

An independent contractor

In a common-carrier delivery contract, the common carrier is:

Adequacy of Consideration

In general, courts do not question the value of the consideration exchanged. In most cases, courts will let the parties decide what the property or services are worth, and will even allow some parties to make an imprudent deal. Suppose Anna's father had a Volkswagen Beetle when she was a little girl. Anna happens to see a Beetle that is the same style and color in a parking lot and waits for the owner, Julie, to return to ask Julie if she will sell the car. Julie is not interested in selling the car, but Anna offers double the market price and Julie agrees to the deal. Later, Anna decides she is getting a bad deal and wants to walk away from the contract. Julie sues Anna. The court can rule that the consideration was adequate because of the sentimental aspect. The parties decided what that car was worth and are now bound by their contract.

Preexisting Duty

In most cases, a promise to do something one must do is not consideration such as requirements imposed by laws or previous contracts. For example, a neighbor could not say to you he will agree to keep his violent dog in the house or otherwise restrained if you give him $1,000 if local ordinances require that anyway.

One

In most situations, how many principals may an agent represent in any one agreement?

false

In order for an implied warranty of fitness for a particular purpose to be created, the seller must be a merchant.

pass without objection in the trade or market for similar goods; be fit for the ordinary purposes for which such goods are used; be adequately contained, packaged, and labeled as the agreement may require; and conform to the promises or affirmations made on the container or label, if any

In order for goods to be merchantable, the goods must ________.

Which of the following distinguishes promissory estoppel cases from quasi-contract cases?

In promissory estoppel cases there is a promise; in quasi-contract cases there is not.

Promissory Estoppel versus Quasi-Contract

In some ways promissory estoppel and quasi-contract theories are similar. They both prevent the injustice of breaches of agreements where no valid contract exists. However, they are different in fundamental ways. In promissory estoppel cases, one party relied on the promise of another party. In quasi-contract cases, no promise was made at all. Instead, the plaintiff gave some benefit to the defendant and the plaintiff reasonably expected to get paid.

Checks

In the United States, of all the negotiable instruments regulated by the Uniform Commercial Code, which are the most common type used?

depositary

In the check collection process, the first bank that receives the check for payment is the ________ bank.

Which of the following IS NOT a basic element of a valid contract?

Integrity is not a basic element of a valid contract. Agreement. Consideration. Contractual capacity. Legality

Which term refers to whether an offeree accepts an offer by promising, by making a down payment, or by performing?

Intent

If a court is required to interpret an ambiguous contractual term, which of the following is the court NOT likely to do?

Interpret language according to what the parties CLAIM their intent was. Courts will not attempt to clarify ambiguous terms by referring to the subjective intent of the contracting parties

Age of Capacity except what states

Nebraska Mississippi Alabama

A ________breach is the only kind that will discharge a contract; a ______breach will not.

material, trivial

Jordynne was the manager of Pets-R-Us, a pet store in Southern Valley Mall. Pets-R-Us had a one-year lease, and rent payments were $2,000.00 per month. Five months into the lease, Jordynne found a better site for the pet store. She notified Southern's manager, vacated the mall, and moved her store to its new location. After two months, Southern was able to re-lease the premises to another retail store, but at a reduced rent of $1,800.00 per month. If Southern successfully sues Pets-R-Us, Southern will likely receive:

$5000 in damages

A creditor on a liquidated debt of $1 million may agree to take which of the following from the debtor in satisfaction of that debt? Select 2 answers.

- 100 cents on the dollar -a horse in exchange for the $1 million that is due

Must all terms of a deal be included in an offer?

No, but the terms required will depend on the type of contract.

Which of the following words, if added to an offer, will cause the offer to fail for definiteness? (Select two)

-Might, as in "I might want to sell you my boat for $1000" -In the future, as in "I will sell you my boat sometime in the future for $1000"

What factors are used to judge if consideration is adequate to ensure a fair bargain? Choose 2 answers.

-Promises must be made with voluntary consent. -Promises exchanged may not be a preexisting duty.

What is required for a writing to be legally sufficient to form a contract? Choose 2 answer choices.

- The writing must provide evidence of agreement - The UCC requires that the quantity be included

If the terms of an agreement seem to be very one-sided, which public policy could it be violating? Choose 2 answer choices

-Restraint of Trade -Substantive Unconscionability

In general, certain terms must be included in contracts to satisfy the requirement of definiteness. What are the exceptions to this rule? Choose 2 answer choices.

-Sales contracts under the UCC -Courts can complete a contract to supply some missing items.

What are the legal differences between a material breach and an immaterial breach of contract? Choose 2 answer choices.

- Whether the court will discharge the contract -The level of the performance of the contractual obligations

Which of the following is legally sufficient consideration? Select 2 answers.

- a promise to do a legal act - forbearance of a legal act

Tyler entered into a contract with Leah to provide supplies for her business. What form can the writing of the contract take? Choose 3 answer choices.

- an invoice - a check - an email

What elements are required for courts to apply the doctrine of promissory estoppel? Choose 3 answers.

-Enforcement of the promise is necessary to avoid injustice to the promisee. -There was a detrimental result from reliance on the promise. -The promise must be definite and relied upon.

What conditions must be met for an offer to be legally accepted? Choose 2 answers.

-It may only be accepted by the intended offeree or the offeree's agent. -Acceptance must be unequivocal with no requests for changes in the offer.

Termination by Law

-intervening illegality -subject matter of offer is destroyed -offeror or offeree becomes insane, dies, etc death of one of the parties. insanity of one of the parties. bankruptcy of the principal. impossibility of performance. outbreak of war. Lapse of Time Destruction of subject matter Death or Incompetence Subsequent illegality

What are the elements of consideration? Choose 2 answer choices.

-something of value from each party -an exchange to which the parties agree

Assuming there is no contract language prohibiting delegations, which of the following acts could likely be delegated? (Select two)

-the mowing of grass in a residential neighborhood to another landscaper -painting the exterior of a house to another house painter

Jody owns Kappa Sales, a sole proprietorship. Jody's liability is

...

Some types of acts or statements are usually not offers:

1. An Invitation to Bargain or Negotiate 2. Price Quotes 3. Letter of Intent - This letter states what the parties are considering, and does not create a legal obligation. 4. Advertisements - Ads are generally not offers, but instead are requests for someone to make an offer. A very detailed advertisement is an exception, and could be considered an offer. 5. Auctions - Auctions are considered requests for offers. In some auctions, the bidding must meet or exceed a certain bid price to complete the sale.

The three required elements for a valid offer include:

1. Intention - The offeror must have a serious intention to enter into the agreement. 2. Definiteness of Terms 3. Communication - The offeror must communicate the terms of the agreement to the offeree.

Employee

6. Jason's Deli hires Sam as a consultant to improve the menu. The CEO assigns the VP of Marketing to assist the consultant. In this scenario, the VP of Marketing is the:

The three required elements for a valid offer include

1. Intention - The offeror must have a serious intention to enter into the agreement. If Lorenzo says, "I am thinking about selling my car for $10,000," he is not displaying sufficient intent to make an offer. 2. Definiteness - The terms of the offer must be sufficiently definite so the parties and a court could understand the terms. This includes who the parties are, the subject matter of the contract, and, if applicable, quantity, time of payment, and delivery, as well as terms regarding performance. If Lorenzo says he will sell his car for $10,000, Lindsay cannot interrupt Lorenzo and say, "I accept your offer to sell your car for $10,000. Now give me the keys to your Maserati!" Lorenzo has ten cars and he actually planned to sell his old Ford Escort, not his Maserati. Thus, a very important piece of information was missing when Lindsay interrupted Lorenzo. 3. Communication - The offeror must communicate the terms of the offer to the offeree.

The main requirements for a valid contract are:

1. Offer - made by the offeror 2. Acceptance - made by the offeree 3. Consideration - what each party gives up under the contract

In general, the terms of the contract must include:

1. The parties 2. The subject matter of the contract 3. The quantity, time of payment, and delivery, if applicable The terms of the performance

When a plaintiff requests the remedy of quasi-contracts from a court, the party must show three elements:

1. The plaintiff provided the defendant with some benefit. 2. The plaintiff reasonably expected to be paid for that benefit and the defendant knew about that expectation. 3. The defendant would be unjustly enriched if he or she did not pay. Once the court creates a quasi-contract, the court will award damages to the plaintiff in the amount of the fair value of the defendant's benefit.

The Age Discrimination in Employment....years of age

1. Question: Able hired Carr to restore Able's antique car for $800. The terms of their oral agreement provided that Carr had 18 months to complete the work. Actually, the work could be completed within one year. The agreement is: 4. enforceable because the work could be completed within one year. Strategy: This is a subtle question. Notice that the contract is for a sum greater than $500. But that is a red herring. Why? The contract also might take 18 months to perform. But it could be finished in less than a year.

A contract for the sale of goods worth $500 or more must be in writing—but this is a contract for services, not the sale of goods, so the $800 price is irrelevant. The contract can be completed within one year, and thus it falls outside the Statute of Frauds. This is an enforceable agreement.

What is an output contract? a. A contract between a manufacturer and a distributor where the distributor only buys from the manufacturer and is contractually prevented from trading with the manufacturer's competitors b. A contract in which the seller guarantees to sell all of its output to one buyer, and the buyer agrees to accept the entire quantity. c. A contract in which a buyer agrees to purchase all of his or her goods from one seller. d. A contract in which a seller agrees to sell a product or service to the buyer only on the condition that the buyer also purchases an additional product from the seller.b

A contract in which the seller guarantees to sell all of its output to one buyer, and the buyer agrees to accept the entire quantity.

Valid Contract

A contract that results when elements necessary for contract formation (agreement, consideration, legal purpose, and contractual capacity) are present. A contract that complies with all the essentials of a contract and is binding and enforceable on all parties to it. a contract which will be enforced by the court one that satisfies all of the law's requirements

Which act or statement is a valid offer? A price quote A detailed advertisement A completed auction with a reserve A typical advertisement

A detailed advertisement

Which of the following is NOT among the types of contracts and clauses that are often held to be contrary to public policy?

A divisible or severable contract.

power of attorney

A document that gives an agent the authority to sign legal documents on behalf of the principal is known as a(n) ________.

in writing and irrevocable for up to three months

A firm offer must be ________.

Consideration

A gratuitous agent is one who acts without ________.

Lack or failure of consideration, breach of contract, and fraud in the inducement in the underlying contract.

A holder in due course is free from the following personal defenses:

What is the difference between a material breach and an immaterial breach? A. A material breach results in damages to the non-breaching party, while an immaterial breach is minor. B. A material breach is one for which remedies are not spelled out in the contract, while remedies for an immaterial breach are specified. C. A material breach is one that makes the contract commercially impracticable for the non-breaching party. D. A material breach is one that affects more than 50% of the product of the contract.

A. A material breach results in damages to the non-breaching party, while an immaterial breach is minor.

What is the best definition of the mailbox rule? A. Acceptance of an offer is generally effective upon dispatch; terminations are effective when received. B. Acceptance of an offer must be on precisely the same terms as the offer. C. Users must agree to certain terms and conditions prior to using the product or service. D. Courts follow certain practices when parties to an agreement fail to make provisions for a particular matter.

A. Acceptance of an offer is generally effective upon dispatch; terminations are effective when received.

What are the possible remedies for a contract formed under duress? Choose 3 answer choices. A. Allow duress as a defense for breach of contract. B. Make the contract voidable. C. Enforce the contract. D. Rescind the contract.

A. Allow duress as a defense for breach of contract. B. Make the contract voidable. D. Rescind the contract.

Alpha Sales, Inc., employs Brittney as a sales agent. Alpha gives Britney a furnished office and an expense account. Consumer Retail Company (CRC) orders goods from Britney, who fills the order with goods from Deal EZ Corporation. The goods are defective. CRC may recover damages from Alpha on the ground of

A. Apparent authority

Joe and Diana form Consumer Goods, Inc. Ultimate responsibility for policymaking decisions necessary to the management of the corporate affairs rests with Consumer's

A. Board of directors

Which of these contracts would be enforceable, despite the existence of a mistake? Choose 2 answer choices. A. Christopher agrees to sell his washer and dryer to Ella. Ella thinks the dryer uses gas instead of electricity, but she is incorrect. B. Christopher agrees to sell his washer and dryer to Ella. He bought them at a yard sale and the sellers told him they were new. Ella believes they are new as well and, as a result, pays a higher price. When Ella encounters problems, a friend shows her parts that are worn. C. Christopher agrees to sell his washer and dryer to Ella in "as is" condition. Ella thinks the set is in excellent condition and is willing to take a chance on buying it. Neither works after a few weeks of use. D. Christopher agrees to sell his washer and dryer to Ella. Christopher overhears Ella telling her friend that she is happy she is getting such a great deal on a new washer and dryer, although Christopher knows he has used them for a year, but he does not correct her.

A. Christopher agrees to sell his washer and dryer to Ella. Ella thinks the dryer uses gas instead of electricity, but she is incorrect. C. Christopher agrees to sell his washer and dryer to Ella in "as is" condition. Ella thinks the set is in excellent condition and is willing to take a chance on buying it. Neither works after a few weeks of use.

Danny hires Evelyn to install a swimming pool at Danny's home for $40,000, to be completed by June 1. Evelyn completes the job on time. When Danny inspects the pool, he discovers that Evelyn used a vinyl lining, and the contract called for a fiberglass lining. Danny refuses to pay Evelyn, stating that Evelyn breached the contract because the contract was not completed according to the specifications stated in the contract. If Evelyn sues Danny for the contract price: A. Evelyn will probably receive the contract price less the cost to replace the pool liner with a fiberglass liner. B. Evelyn will probably receive the full contract price. C. Evelyn will probably receive restitution for any expenses she has incurred. D. Evelyn will receive nothing because performance under the contract was not complete.

A. Evelyn will probably receive the contract price less the cost to replace the pool liner with a fiberglass liner.

Isabel is 17 years old and wants to stop paying for the use of the local gym, but wishes to continue teaching classes. Her contract with the company includes terms regarding her employment and use of the facility. What must she do to properly disaffirm the contract? Choose 2 answer choices. A. Isabel must disaffirm both the gym membership obligations and the employment terms in the contract. B. Isabel must let gym staff know she is terminating the contract. C. Isabel can choose to disaffirm the gym membership portion of the contract and retain the employment terms. D. Isabel must wait until she turns 18 to disaffirm the contract.

A. Isabel must disaffirm both the gym membership obligations and the employment terms in the contract. B. Isabel must let gym staff know she is terminating the contract.

What function does a severability clause serve? Choose 2 answers. A. It specifies what will happen with a potentially unenforceable part of a contract. B. It preserves the rest of the contract if one part is unenforceable C. It specifies how the contract will be terminated. D. It sets the amount of damages to be paid if one party breaches the agreement.

A. It specifies what will happen with a potentially unenforceable part of a contract. B. It preserves the rest of the contract if one part is unenforceable

Your friend meets you for coffee one day driving a brand new motor scooter. You immediately fall in love with it and offer them $2,000 for it. Your friend politely declines and states they paid $3,000 but goes on to say "I may sell you my scooter, if you pay $2,700."If your friend later refuses to go through on the deal, can you hold them liable for breach of contract? A. No, because there was never any consideration. B. Yes, because there was a valid offer and acceptance. C. Yes, because you agreed to pay $2,700. D. No, because the value of the scooter is not equal to the value of the agreement.

A. No, because there was never any consideration.

What is the difference between commercial impracticability and frustration of purpose? Choose 2 answer choices. A. One focuses on the challenges in performing the contract. B. One focuses on the reasons why the parties entered into the contract. C. One focuses on the financial positions of the parties. D. One applies only to contracts between businesses and not to contracts between a business and a consumer.

A. One focuses on the challenges in performing the contract. B. One focuses on the reasons why the parties entered into the contract.

Quinn employs Roy as his authorized business agent on April 1. Quinn's son Stan petitions a court to declare Quinn mentally incompetent. The court grants Stan's request on May 1. Roy enters into a contract on Quinn's behalf on April 15. After May 1, the contract, which has not been performed, is

A. binding on Quinn

Which of the following parties must sign an agreement that is subject to the statute of frauds?

The party against whom action is sought only

Korbyn enters into a contract with Peyton to sell Peyton a 1956 roadster. The contract has a condition precedent that the roadster will pass inspection by an independent appraiser, verifying that the roadster contains all original parts and is in good working order. This contract provision means that: A. Peyton is not required to perform under the contract until the appraisal is complete. B. Peyton must have the appraisal completed within thirty days of performing the contract and provide the results to Korbyn. C. if the appraisal is not satisfactory to both parties, the contract price will be adjusted accordingly. D. Peyton must pay for the roadster at the time of contracting, and Korbyn will then order the appraisal.

A. Peyton is not required to perform under the contract until the appraisal is complete.

If the terms of an agreement seem to be very one-sided, which public policy could it be violating? Choose 2 answer choices A. Restraint of Trade B. Substantive Unconscionability C. Mutual mistake D. Duress

A. Restraint of Trade B. Substantive Unconscionability

Which of the following elements are required to show fraudulent misrepresentation in a contract? (Select all that apply) A. Scienter B. Justifiable reliance on the fact by the innocent party C. Latent defect D. Misrepresentation of any fact E. Misrepresentation of a material fact F. Damages

A. Scienter B. Justifiable reliance on the fact by the innocent party D. Misrepresentation of any fact F. Damages

What is the evaluation standard for a personal satisfaction contract? Choose 2 answer choices. A. Subjective personal taste B. Expert standards C. Objective, reasonable person standard D. Accepted standards for the area or region

A. Subjective personal taste C. Objective, reasonable person standard

How can the legal concepts of accord and satisfaction apply to negotiable instruments? Choose 2 answer choices. A. The UCC provides debtors a way to prove accord and satisfaction. B. Similar to bankruptcy, the debt is forgiven with accord and satisfaction. C. The parties can agree to discharge the instrument for less than the stated amount. D. Accord and satisfaction offers guidelines regarding how the parties should discharge the debt.

A. The UCC provides debtors a way to prove accord and satisfaction. C. The parties can agree to discharge the instrument for less than the stated amount.

What factors must be present to prove fraudulent misrepresentation in a contract? Choose 3 answers. A. The innocent party has justifiably relied on the misrepresentation. B. The defrauding party must have exerted undue influence on the innocent party. C. There has been an intent to deceive. D. A misrepresentation of a material fact has occurred.

A. The innocent party has justifiably relied on the misrepresentation. C. There has been an intent to deceive. D. A misrepresentation of a material fact has occurred.

What are the legal differences between a material breach and an immaterial breach of contract? Choose 2 answer choices. A. The level of the performance of the contractual obligations B. The dollar amount of damages C. Whether a party has announced repudiation of the contract D. Whether the court will discharge the contract

A. The level of the performance of the contractual obligations D. Whether the court will discharge the contract

Ron and Nancy form Eagle Equipment Corporation. Eagle has a board of directors, a chief executive officer, a chief operating officer, and fifty-two shareholders. Eagle is governed by its

A. board of directors

Visual Play Company makes DVD players. Visual Play is like most corporations in that its officer are hired by the firm's

A. board of directors

What elements are required for an offer to be effective under the common law? Choose 3 answers. A. The offeror must intend to be bound by the offer. B. The offer must be irrevocable for a set period of time to allow acceptance. C. The terms of the offer must be reasonably definite so that all parties understand them. D. The offer must be communicated to the offeree.

A. The offeror must intend to be bound by the offer. C. The terms of the offer must be reasonably definite so that all parties understand them. D. The offer must be communicated to the offeree.

What does the law require for a personal service contract? A. The personal service requirement must be stated. B. The experts who will be evaluating the work must be listed so the parties are on notice in advance. C. A special acknowledgement by each party that the contract is a personal satisfaction contract D. The specific standards must be clearly delineated.

A. The personal service requirement must be stated.

In what situation could a party enforce strict performance? A. When the parties specifically agree to it in the contract B. The plaintiff received sufficient benefit and the difference can be compensated with monetary damages C. When the requirement is reasonable D. When one of the parties did not act in good faith

A. When the parties specifically agree to it in the contract C. When the requirement is reasonable

Robert inherited lots of antique tools when his father died. Because Robert is not interested in woodworking, he decides to sell several of the tools. Robert agrees to sell an antique hand-held wood planer to Geoffrey for $50. After agreeing to the deal, Robert discovers that the planer is a pre-WWII Norris Jointer Planer worth over $5,000, and refuses to sell the planer to Geoffrey. Can Geoffrey enforce the deal? A. Yes, Geoffrey can enforce the deal because the contract contained valid consideration. B. Yes, Geoffrey can enforce the deal but only if Geoffrey was not aware of the true value of the planer. C. No, Geoffrey cannot enforce the deal because Robert was unaware of the true value of the planer. D. No, Geoffrey cannot enforce the deal because the amount of consideration is insufficient.

A. Yes, Geoffrey can enforce the deal because the contract contained valid consideration.

When one person agrees to pay the debt of another as a favor to that debtor, it is called

A. a collateral promise.

American Products, LLC, is a limited liability company. Rather than distribute its profits to its members, American wants to reinvest the profits in its business. For this reason, American may prefer to be taxed as

A. a corporation

Owen and Paula agree to operate an espresso stand. They purchase their supplies and split the costs equally. They agree to share the profits equally, and decide that each of them will have an equal say in how the stand will operate. Nothing is put in writing. Owen and Paula have formed

A. a partnership

Jay holds himself out as possessing special accounting skills. As an agent, he must exercise the degree of skill or care expected of

A. a person having those skills

BizOnline.com uses an electronic agent, or e-agent, to perform certain tasks in e-commerce. With respect to the e-agents actions, BizOnline.com is bound by

A. all of the actions

Donna and Ed are shareholders of Friendly Credit, Inc. As shareholders, they must approve

A. amending the articles of incorporation

Roz and Sara work as clerks in Trina's Hot Clothes Shop. Trina withholds federal taxes from their pay, and controls the methods and details of the performance of their work. Roz and Sara are not authorized to modify the prices or other terms of a sale at the shop. Trina hires Unity Cleaning Company to clean the carpets of her shop. Trina gives Unity instructions as to what needs to be cleaned and when. Unity is

A. an independent contractor

Quick Supplies Company (QSC) requires its customers to pay by check. Ron, a QSC driver, tells customers on his route that they can pay him in cash. When QSC learns of Ron's collections, it takes no action to stop it. Ron steals some of the cash. QSC may suffer the loss under the doctrine of

A. apparent authority

Gil is a purchasing agent for H&H Ranch with the authority to buy cattle at a certain auction. After the cattle have been bought, the agency relationship terminates

A. automatically

Irma retains Jerry as her authorized agent, unaware that Jerry is a minor. Jerry enters into a contract with Ken on Irma's behalf. The contract is

A. binding on Irma

American Goods, Inc., is a corporation. Responsibility for the overall management of American Goods is entrusted to

A. the board of directors

Christiana is seventeen years old and has been emancipated. Christiana shares an apartment with a roommate and totally supports herself. Christiana purchases a stereo from Best Stereo Place, Inc. and signs an installment agreement to pay for the stereo over the next twelve months. After paying on the stereo for three months, Christiana decides she no longer wants the stereo. To avoid the rest of the payments on the stereo, Christiana can: A. do nothing. Because Christiana signed the contract as an emancipated minor, she has no grounds to rescind the contract. B. give notice to Best Stereo Place that she wishes to rescind the contract based on her minority status. C. ask Best Stereo Place to rescind the contract based on Christiana's minority status. D. just stop paying. Because Christiana is a minor, she is not required to give notice to Best Stereo.

A. do nothing. Because Christiana signed the contract as an emancipated minor, she has no grounds to rescind the contract.

Susan took out a life insurance policy on herself, paying all of the premium payments. She named her daughter, Jessica, as the beneficiary under the policy. Jessica has not given anything in consideration for the policy. Jessica is a(n) A. donee beneficiary who has rights to enforce the policy once Susan dies. B. incidental beneficiary because Jessica did not give any consideration for the policy and therefore cannot enforce the policy even when Susan dies. C. promisor in the contract with no enforcement rights. D. creditor beneficiary who has rights to enforce the policy once Susan dies.

A. donee beneficiary who has rights to enforce the policy once Susan dies.

When is an assignment enforceable against an obligor? A. from the moment the obligor is notified of the assignment B. from the moment the assignment is made C. from the moment the assignee gives consideration D. from the moment the obligor signs the contract

A. from the moment the obligor is notified of the assignment

A. if Marie's children can prove that Marie lacked the mental capacity to comprehend the nature, purpose, and consequences of the contract.

Amy wants to go into the business of construction contracting, Among the reasons that would probably convince Amy to set up her business as a sole proprietorship would be

A. its greater organizational flexibility

Dan, an agent for Eve, signs an agreement with Fred on Eve's behalf but neglects to tell Eve that the agreement requires the payment of a certain tax. The government prosecutes Eve for failing to pay the tax. Eve is

A. liable, because Dan's knowledge is imputed to Eve

Wright Company contracted with the city of St. Louis to train and employ disadvantaged youths. If Wright fails to fulfill the contract and is sued by one of the disadvantaged youths, the youth would A. lose, as he is an incidental beneficiary. B. win, as he is a donor beneficiary. C. win, as he is an intended beneficiary. D. lose, as he is a creditor beneficiary.

A. lose, as he is an incidental beneficiary.

What factors may cause a person to lack contractual capacity? Choose 3 answers. A. mental incompetence B. severe intoxication C. being under the age of majority (usually 18) D. being an emancipated minor

A. mental incompetence B. severe intoxication C. being under the age of majority (usually 18)

Internet Services, Inc., employs Joe as an agent. During the agency, Joe acquires new skills. After the termination of the relationship, Joe uses those skills in a new job. Joe has breached

A. no duty

Dean starts up E-Sites, an internet service, and leases office space in a building owned by Fred. The lease requires Dean to pay Fred a base rental of $250, plus 10 percent of E-Sites' profits, each month. The term is two years. Dean hires Gina to work at E-Sites' tech support desk at an hourly wage of $9.00, plus a commission of 10 percent of the profits. The term is also two years. Dean and Fred are

A. not partners, because Fred does not have an owndership interest or management rights in E-Sites

A. not partners, because Gina does not have an ownership interest or management rights in E-Sites

What is the standard to which most personal satisfaction contracts must adhere? Choose 2 answers. A. satisfaction of the receiving party (buyer) B. satisfaction of the performing party (seller) C. satisfaction of a reasonable person D. satisfaction of an expert third party

A. satisfaction of the receiving party (buyer) C. satisfaction of a reasonable person

Ellen offers to sell her 1997 Mustang convertible to Fred for $2,000. Fred agrees to pay $2,000 for Ellen's Mustang. Before Fred picks up the Mustang, Ellen discovers that the Mustang is considered a classic car and is worth much more than $2,000. Ellen refuses to sell the Mustang to Fred, stating that the consideration is insufficient. If Fred tries to enforce the deal by taking Ellen to court: A. the court would probably enforce the deal because there was valid consideration on both sides. B. the court would probably not enforce the deal because there is no consideration flowing from Ellen to Fred. C. the court would probably enforce the deal because the amount of consideration is never an issue. D. the court would not enforce the deal because $2,000 is too low to be valid consideration.

A. the court would probably enforce the deal because there was valid consideration on both sides.

Jill introduces Kelly to her friends as "my associate." Kelly purports to act as Jill's agent in several business transactions with those friends. If Jill is liable for Kelly's actions, it will be under

A. the doctrine of estoppel

If Ramona changes her will at age 88 to leave the bulk of her fortune to her home health care nurse instead of her children, what factor will the courts consider in judging whether or not her will is valid? A. undue influence B. mistake C. duress D. fraudulent misrepresentation

A. undue influence

Relative to Adam's potential liability for actions against his above referred to business entity, it is

A. unlimited

In general, which of these contract terms is NOT required to meet the requirement of definiteness? Acceptance The parties involved The time of payment The subject matter of the contract

Acceptance

Which of the following is true if no means of communicating an acceptance is specified in an offer?

Acceptance may be made by any reasonable means.

What conditions must be met for an offer to be legally accepted? Choose 2 answers. The offer must be accepted within 24 hours of communication. Acceptance must be unequivocal with no requests for changes in the offer. Acceptance must be communicated in words, either written or oral. It may only be accepted by the intended offeree or the offeree's agent.

Acceptance must be unequivocal with no requests for changes in the offer. It may only be accepted by the intended offeree or the offeree's agent.

What is the best definition of the mailbox rule? a. Courts follow certain practices when parties to an agreement fail to make provisions for a particular matter. b. Users must agree to certain terms and conditions prior to using the product or service. c. Acceptance of an offer is generally effective upon dispatch; terminations are effective when received. d. Acceptance of an offer must be on precisely the same terms as the offer.

Acceptance of an offer is generally effective upon dispatch; terminations are effective when received.

good faith

According to the Uniform Commercial Code, ________ is defined as "honesty in fact and the observance of reasonable commercial standards of fair dealing."

impracticable

According to the Uniform Commercial Code, a delay in delivery or non-delivery, in whole or in part, is not a breach in circumstances in which performance has been made ________ because a contingency has occurred that was not contemplated when the parties reached the agreement.

the names and addresses of all the parties involved, a description of the collateral, and the signature of the debtor

According to the Uniform Commercial Code, a financing statement should include ________.

as soon as it is issued

According to the Uniform Commercial Code, a party who signs as an issuer of an instrument is liable for the amount of the instrument ________.

Savings and loans, trust companies, and credit unions

According to the Uniform Commercial Code, which of the following are considered banks?

Course of performance

According to the Uniform Commercial Code, which of the following refers to the history of dealings between the parties in the particular contract at issue?

Which of the following represents the legal determination that the defendant's breach of duty resulted directly in the plaintiff's injury?

Actual cause

pledge

The transfer of collateral to a secured party for the purpose of perfection is called a(n) ________.

Which of the following is an example of an implied contract? Alberto visits his physician to be treated for a sinus infection. They do not discuss payment, but the following week Alberto receives a bill from his physician for services rendered. Midori offers to sell a necklace to Patricia for $50; Patricia agrees to pay $50 for the necklace. Amy tells her neighbor Tom, "If you rake up my leaves, I'll bake you a batch of brownies." Tom accepts the offer. Miguel wants to purchase his first home. When he found the perfect place, he signed a contract for purchase and closed on the home within a month.

Alberto visits his physician to be treated for a sinus infection. They do not discuss payment, but the following week Alberto receives a bill from his physician for services rendered.

Alfred will win because the act of repairing Alfred's car is past consideration, and therefore no valid contract was formed.

Which of the following is incorrect regarding written contracts?

All contracts must be in writing in order to be enforced.

The legal determination of whether an employee is an employee or an independent contractor depends on which of the following factors?

All of the Above

Workers are protected from discrimination in the workplace based on

All of the Above

Past Consideration

An offer for something given in the past as the basis for a future contract is not valid consideration. Pat is a contractor who sometimes hires Sophie to do excavation work. Pat is having trouble selling some old equipment and decides to give it to Sophie. A few months later, Pat needs some excavation work and asks Sophie to do the work. Sophie asks for money, but Pat says, "I gave you some old equipment so you should do this work for no charge." The equipment Pat had given to Sophie would be past consideration and would not be consideration for the new deal.

draft

An order by a drawer to a drawee to pay a payee is known as a ________.

Virginia borrowed money from G & L Lending at 35% interest per year. The state maximum interest rate is 20% per year. Virginia defaulted on the loan. What amount can G & L collect from Virginia? a. G & L will be able to collect the principal but not any interest. b. G & L will not be able to collect either the principal or interest. c. Any one of these may be correct. The answer depends on the particular state law. d. G & L will be able to collect the principal plus 20% interest per year.

Any one of these may be correct. The answer depends on the particular state law.

What types of powers do appellate courts have?

Appellate courts have the power to review previous judicial decisions to determine whether trial courts erred in their decisions.

Ashish will be successful, because it is a mathematical mistake that Huseyin was aware of.

Which of the following is incorrect regarding the rights of assignees and assignors?

Assignees are entitled to greater contractual protections than those afforded assignors.

The carrier may stop delivery regardless of the quantity shipped.

Assuming a buyer that is insolvent has breached a contract by not paying for goods that are in transit, which of the following may occur?

Alfred is having trouble with his car so he visits his friend Glen, who is a mechanic, for some free advice. Alfred asks Glen just to look at the car and determine what is wrong, but not to fix it. Glen looks at the car, determines the problem, and repairs the car using parts and materials he already had in his garage. Alfred takes the car out for a test drive, and it performs better than it ever has. Alfred tells Glen that because Glen fixed his car, when Alfred gets paid again he will buy Glen the new torque wrench that Glen has been wanting. A week later, Glen asks Alfred about the torque wrench, and Alfred tells Glen that he has changed his mind. If Glen sues Alfred to enforce his promise to buy Glen the torque wrench: A. Alfred will win because the contract between Glen and Alfred was not in writing, and therefore not valid. B. Alfred will win because the act of repairing Alfred's car is past consideration, and therefore no valid contract was formed. C. Glen will win because consideration flowed from each party, and therefore a valid contract was formed. D. Glen will win because all the elements required for a valid contract are present.

B. Alfred will win because the act of repairing Alfred's car is past consideration, and therefore no valid contract was formed.

A police officer who finds a missing child as part of his duties may not collect any reward for finding the child. Why? A. Because the officer did not accept the offer prior to finding the child. B. Because the officer already had a pre-existing duty to do so. C. Because the officer did not promise to perform the act. D. Because the reward is not a valid offer.

B. Because the officer already had a pre-existing duty to do so.

Tim sent an email to Belinda offering to sell his car to her for $5,000. Belinda texted Tim back offering to pay $4,000 for the car. A valid contract did not exist because A. consideration was not present in the negotiations. B. Belinda did not accept Tim's offer; she is still negotiating. C. Belinda should have accepted Tim's offer orally. D. the contract was not for a lawful purpose.

B. Belinda did not accept Tim's offer; she is still negotiating.

Bree, who runs a livestock breeding business, owes the Circle C Ranch $400,000. Bree agrees to pay the Circle C a percentage of her profits each month until the debt is paid. Because of this agreement, the Circle C is

B. Bree's creditor only

Garth's Imports sold a car to Wally on credit for $30,000. Garth assigned to Cassandra all of his rights to receive money from Wally. Cassandra did not inform Wally of the assignment. Therefore, Wally continued to make the next three payments directly to Garth. Shortly thereafter, Garth left the country with the money. If Cassandra sues Wally for the missing three payments A. Cassandra will be able to collect the money from Wally. B. Cassandra will not be able to collect the money from Wally. C. Wally is liable for the three payments because Cassandra paid consideration for the assignment rights. D. Wally cannot raise the defense of previous payment.

B. Cassandra will not be able to collect the money from Wally.

Melissa felt pressured into signing a contract that released her employer from any liability if she is injured on the job. What prohibited behavior under public policy could this be? A. Substantive Unconscionability B. Exculpatory Clause C. Restraint of Trade D. Procedural Unconscionability

B. Exculpatory Clause

Statewide Distributors, Inc. (SDI), is a corporation. Owen is an SDI officer Which of the following possess Fifth Amendment rights in a criminal case?

B. Owen only

Otto orally agrees to install three wells for Green Space Energy over the next eighteen months. When the three wells are completed, Green Space Energy will pay Otto $10,000. After the first well is completed, Green Space Energy tells Otto that it does not want any more wells. Green Space Energy refuses to pay Otto for the first well, claiming that the contract was not in writing and, therefore, not enforceable. If Otto sues Green Space Energy to enforce the contract: A. Green Space Energy will not have to pay Otto anything because the contract was for real estate. B. Green Space Energy will have to pay Otto a reasonable price for the one well that was installed. C. Green Space Energy will not have to pay Otto anything, because the contract could not be completed within one year. D. Green Space Energy will have to pay Otto the full contract price because Green Space Energy breached the contract.

B. Green Space Energy will have to pay Otto a reasonable price for the one well that was installed.

What must a party show to win a substantial performance lawsuit? Choose 2 answer choices. A. The breach caused no monetary damages. B. He or she acted in good faith. C. There were no deviations from the contractual requirements. D. The breach was not intentional.

B. He or she acted in good faith. D. The breach was not intentional.

Jamal purchases a refrigerator from Appliances For You under an installment agreement. The price of the refrigerator is $1,500. Jamal is required to pay very low monthly payments, but the payments are to be made over a period of several years. By the end of the contract, Jamal will have paid $12,000 for the refrigerator. Jamal signs the agreement anyway, because he really needs a refrigerator. If Jamal later tries to rescind the contract: A. Jamal may rescind the contract because the contract is illegal on its face. B. Jamal may rescind the contract because it is a contract of adhesion. C. Jamal may not rescind the contract because it is in writing. D. Jamal may not rescind the contract because it meets all the requirements of a valid contract for the sale of goods under the U.C.C.

B. Jamal may rescind the contract because it is a contract of adhesion.

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? A. Neither offer is valid. Who would ever pay $1,000 or $1,500 for a beer can collection? B. Mary's counteroffer terminates Carl's offer of $1,500. C. Mary's offer is an option contract and she cannot revoke the offer. D. If Carl rejects Mary's counteroffer, she can still accept Carl's offer of $1,500.

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

Myra, an agent for National Buys, Inc., has often done business with Owen on National's behalf. Myra and National terminate their agency. For Myra and National to avoid liability for later deals, Owen must be notified by

B. National only

You go out drinking and playing cards with your buddies. After you have consumed a huge amount of alcohol, you agree to sell your motorcycle to your buddy. The next morning, after you sober up, your buddy tells you what you did.Do you think your buddy can legally hold you to the deal to sell him your motorcycle? A. Yes, he can, even though you were so intoxicated that you could not form the mental capacity to enter into a contract, whether or not your buddy knew you were intoxicated. B. No, he can't, if you were so intoxicated that you could not form the mental capacity to enter into a contract, and your buddy knew you were intoxicated. C. No, he can't, if you were so intoxicated that you could not form the mental capacity to enter into a contract, whether or not your buddy knew that you were intoxicated. D. Yes, he can, even though you were so intoxicated that you could not form the mental capacity to enter into a contract, and your buddy knew you were intoxicated.

B. No, he can't, if you were so intoxicated that you could not form the mental capacity to enter into a contract, and your buddy knew you were intoxicated.

Ruby, a seventeen-year-old, purchases a car from Smitz Used Auto Sales and agrees to pay for it over a period of twenty-four months. Ruby makes the payments for four months but then decides the car payment is too much for her limited budget. Ruby tells Smitz that she wants to stop making payments and that she wants out of the contract completely. The contract between Ruby and Smitz can be canceled by: A. Ruby, because she is a minor, and Ruby may keep the car. B. Ruby, because she is a minor, but Ruby must return the car. C. Smitz, because Ruby is a minor, but Smitz must allow Ruby to keep the car. D. Smitz or Ruby, because Ruby is a minor, and Ruby may keep the car. Ruby, because she is a minor, but Ruby must return the car.

B. Ruby, because she is a minor, but Ruby must return the car.

How is substantial performance involved with the classification of material breaches versus immaterial breaches? A. Substantial performance involves a material breach. B. Substantial performance involves an immaterial breach. C. Anticipatory repudiation determines the status of substantial performance. D. Substantial performance can occur with either a material or an immaterial breach.

B. Substantial performance involves an immaterial breach.

What is an example of commercial impracticability? A. The parties work to modify a contract and cannot come to an agreement. B. Tariffs quadruple on a key raw material, making the manufacturing of a product very expensive. C. Oil prices increase, making delivery obligations under a contract more expensive. D. One of the parties no longer needs the product or service required by the contract.

B. Tariffs quadruple on a key raw material, making the manufacturing of a product very expensive.

Samuel has mental competency issues. Samuel entered into a contract with Beth, but now Samuel is petitioning the court to terminate the contract. What options does the court have in ruling in the case? Choose 2 answer choices. A. The contract is voidable if a court has previously determined Samuel to be mentally incompetent. B. The contract is void if Samuel has been previously determined to be mentally incompetent. C. The contract is void if Samuel was incompetent at the time the contract was formed. D. The contract is voidable if Samuel was incompetent at the time the contract was formed.

B. The contract is void if Samuel has been previously determined to be mentally incompetent. D. The contract is voidable if Samuel was incompetent at the time the contract was formed.

What is the result of a contract in which both parties are wrong about a material fact of the contract? A. The contract is void. B. The contract is voidable. C. The contract is enforceable by both parties as both parties assumed the risk in making the contract. D. The contract must be nullified and renegotiated.

B. The contract is voidable.

What factors may overturn a minor's right to disaffirm a contract? Choose 3 answers. A. The object of the contract has been destroyed. B. The minor ratifies the contract after reaching the age of majority. C. The minor misrepresented the minor's age while engaging in business as an adult. D. The contract is for necessaries.

B. The minor ratifies the contract after reaching the age of majority. C. The minor misrepresented the minor's age while engaging in business as an adult. D. The contract is for necessaries.

Why would parties use accord and satisfaction regarding a negotiable instrument? Choose 2 answer choices. A. Accord and satisfaction is a legal method to force both parties to perform the terms of the original instrument. B. The parties might wish to avoid a lawsuit. C. The parties could use it as a first step to filing a lawsuit. D. The parties could wish to end the obligation without further conflict.

B. The parties might wish to avoid a lawsuit. D. The parties could wish to end the obligation without further conflict.

What must a plaintiff prove to show duress in the formation of a contract? Choose 2 answer choices. A. The plaintiff was injured or feared he or she would be injured. B. The plaintiff was incapable of voluntarily agreeing to the contract. C. The defendant committed a wrongful or illegal act. D. The defendant intended to harm the plaintiff.

B. The plaintiff was incapable of voluntarily agreeing to the contract. C. The defendant committed a wrongful or illegal act.

Alan is a shareholder of Interstate Transport Company (ITC). When the directors fail to undertake any action to redress a wrong suffered by ITC, Alan files a suit on ITC's behalf. This suit is a shareholder's

B. derivative suit

You own a lawn care service. A new customer calls and asks that you mow and weed eat her lawn. You tell her the price will be $150 and she agrees. You show up while she is at work and get the lawn mowed and the weed eating done by the time she gets home. Unfortunately, when she gets home, you discover that you have serviced the lawn of your customer's next-door neighbor instead of hers!Do you think you have any chance of getting any money from the neighbor for the services you have provided? A. No, but you can collect the money from your new customer. B. Yes, the neighbor will have to pay you a reasonable price (not necessarily the contract price) for the work. C. No, because you did not have a contract with the neighbor. D. Yes, the neighbor will have to pay you the contract price because you performed the work.

B. Yes, the neighbor will have to pay you a reasonable price (not necessarily the contract price) for the work.

Does the statement "The sale of goods will not be enforceable unless there is some writing, signed by the defendant, indicating that the parties reached an agreement" accurately reflect the UCC's basic rule? A. No. It should state that the contract must require all of the terms of the agreement to be in writing. B. Yes. The wording accurately reflects the UCC's basic rule. C. No. It should state that the contract must be for the sale of goods of $500 or more. D. No. It should also state that the contract must be signed by both parties, not just the defendant.

B. Yes. The wording accurately reflects the UCC's basic rule.

What types of contracts violate public policy? Choose 3 answers. A. a contract to allow a political candidate exclusive use of billboards you own B. a candidate for public office paying his competitor to retire C. employment contracts that forbid membership in a union D. conducting trade with a country that is an enemy to the United States

B. a candidate for public office paying his competitor to retire C. employment contracts that forbid membership in a union D. conducting trade with a country that is an enemy to the United States

Restitution is an appropriate remedy when: (Select three) A. an injunction is necessary. B. a contract has been breached. C. a contract has been rescinded. D. when the parties never had a contract.

B. a contract has been breached. C. a contract has been rescinded. D. when the parties never had a contract.

Acme, Inc., is incorporated in the state of California and is doing business in the state of Nevada. In Nevada, it is properly referred to as

B. a foreign corporation

Intech Corporation makes and sells computer chips. In most states, the minimum number of directors that must be present before Intech's board could transact its business is

B. a majority of the number authorized in the articles or bylaws

James and Quincy are directors of Monroe Investments Corporation. Monroe has fifty-two shareholders. A dividend on Monroe stock can be declared by

B. a majority vote of the board

Accounting Applications, LLC, is a limited liability company. Unless indicated otherwise on Accounting's federal tax form, the firm will be taxed as

B. a partnership

Computer Networks, LLC, is a limited liability company. Unless indicated otherwise on Computer Networks' federal tax form, the firm will be taxed as

B. a partnership

A misrepresentation of fact may occur in a contract, by silence, when: (Choose 2 answers.) A. when the buyer is unsophisticated B. a party is under a duty to speak (such as a professional from whom the other party is seeking an opinion) C. when the seller knows there is an obvious defect in a product the seller knows of a serious problem that the buyer in unlikely able to discover

B. a party is under a duty to speak (such as a professional from whom the other party is seeking an opinion) D. the seller knows of a serious problem that the buyer in unlikely able to discover

An agreement will lack consideration if: A. a person settles a disputed claim through an accord and satisfaction. B. a person makes a promise in return for an act which has yet to take place. C. a person makes a promise in return for an act which has already taken place. D. a person performs an act required by an offer.

B. a person makes a promise in return for an act which has yet to take place.

Tasty Pastry, a retail bakery, is a partnership. In terms of the firm's income taxes on its profits, each partner is liable for

B. a pro rata share whether or not the profits are distributed

Jill is a shareholder of American Computers, Inc. Jill will be deemed to have fiduciary duty to American Computers and to the minority shareholders if she has

B. a sufficient number of shares to exercise de facto control of the corporation

Agnes is a sales person for Beta Technical Instruments, Inc. (BTI). She misrepresents to Curt, a customer, that a certain device has a certain capability. In reliance, Curt buys the device. Liable for this misrepresentation is

B. agnes only

What are the elements of consideration? Choose 2 answer choices. A. a preexisting duty B. an exchange to which the parties agree C. something of value from each party D. past consideration

B. an exchange to which the parties agree C. something of value from each party

A rock group assigns its payment under a performance contract to the Costume Shop, a business that has supplied the group with outrageous stage outfits, and to which the group owes a great sum of money. Under this arrangement the rock group is the A. assignee. B. assignor. C. delegator. D. delegatee.

B. assignor.

When may a contract be modified? A. at any time, if the contract is oral B. at any time, if the parties are in agreement C. never D. only before it is signed by all parties

B. at any time, if the parties are in agreement

Carol is a director of Diners Restaurants, Inc. Carol would breach her duty of loyalty if she

B. becomes a director of Great Foods Corporation, a competing firm

Adam, the owner of Adam's Apples, a sole proprietorship, wishes to increase his business capital. This objective can best be accomplished by

B. borrowing funds from lenders

What is the most common way that duties under a contract are discharged? A. frustration of purpose B. by performance C. breach D. by proving undue influence

B. by performance

Tyron purchased a vacant lot and entered into a contract with BZ Inc. to construct a shopping center on the site. Douglas heard about this contract and built a restaurant on an adjoining piece of property because of the planned shopping center. Tyron was unable to raise the necessary capital and was unable to perform the contract with BZ, Inc. Douglas sued Tyron for breach of contract as a third party beneficiary. Douglas will probably A. win as a third party donee beneficiary. B. lose as a third party incidental beneficiary. C. lose as a third party creditor beneficiary. D. win as a third party creditor beneficiary.

B. lose as a third party incidental beneficiary.

If Rudy offers Oscar $200 for his laptop valued at $600 and Oscar agrees, a court will probably A. set aside the agreement because the consideration is inadequate. B. not set aside the agreement based on the adequacy of the consideration. C. set aside the agreement as being unfair. D. not set aside the agreement because of the UCC.

B. not set aside the agreement based on the adequacy of the consideration.

Frosty Drinks Corporation distributes soft drinks in the Midwest. Frosty's board of directors can delegate some of its functions to the firm's

B. officers

Great Stores, Inc., must hold a shareholders' meeting

B. once a year

Computer Games, LLC, is a limited liability company. Among members, a dispute arises that their operating agreement does not cover. No statute applies. The dispute is governed by the principles of

B. partnership law

Computer Games, LLC, is a limited liability company. Among the members, a dispute arises that their operating agreement does not cover. The dispute is governed by

B. partnership law

What remedies are available in the case of a unilateral mistake in making a contract? Choose 2 answers. A. enforcement B. rescission C. punitive damages D. reformation

B. rescission D. reformation

Dora has been in a nursing home for three years and rarely has visitors. Vanita works at the nursing home and regularly takes care of Dora. Vanita and Dora have become very close, and Dora depends on Vanita to help her with decisions about her finances. Just before Dora dies, Vanita and Dora enter into a contract to sell Dora's family home to Vanita for $20,000. The home is worth $100,000. If Dora's children try to void the contract between Vanita and Dora: A. the children will not be successful in voiding the contract, because there is valid consideration and the contract is in writing. B. the children may be able to void the contract based on undue influence. C. the children may be able to void the contract based on fraud. D. the children may be able to void the contract based on illegality.

B. the children may be able to void the contract based on undue influence.

Which of the following may constitutes duress? (Choose 2 answers.) A. threatening to sue someone B. threatening to financially harm someone C. threating to boycott a company D. threatening to physical harm someone

B. threatening to financially harm someone D. threatening to physical harm someone

Jay is a member of Kappa, LLC, a limited liability company. Jay is liable for Kappa's debts

B. to the extent of his capital contribtution

A contract for an illegal purpose is: A.dischargeable. B. void. C. voidable. D. enforceable as a quasi-contract.

B. void.

When are covenants not to compete in employment contracts considered to be against public policy? Choose 2 answers. A. when the business is mostly a service business B. when the specified time of restraint is excessivess C. when the business is mostly online D. when the geographical restriction is too broad

B. when the specified time of restraint is excessivess D. when the geographical restriction is too broad

individuals, corporations, and partnerships

Bankruptcy remedies are available to ________.

Why is a court unlikely to grant a remedy for specific performance when a contract for personal services is breached?

Because it is tantamount to court ordered involuntary servitude.

A police officer who finds a missing child as part of his duties may not collect any reward for finding the child. Why?

Because the officer already had a pre-existing duty to do so.

10.NC youth employment provisions of the Wage & Hour Act

Becca is 16 years old, and her employer wants her to use the slicer and the cardboard compactor in the deli. Which act is this company violating?

Tim sent an email to Belinda offering to sell his car to her for $5,000. Belinda texted Tim back offering to pay $4,000 for the car. A valid contract did not exist because a. Belinda did not accept Tim's offer; she is still negotiating. b. Belinda should have accepted Tim's offer orally. c. consideration was not present in the negotiations. d. the contract was not for a lawful purpose.

Belinda did not accept Tim's offer; she is still negotiating.

Which of the following IS NOT a requirement of a valid contract?

Both parties must be consenting adults. Minors (those under the age of eighteen, usually) may form valid contracts. There must be an agreement (offer and acceptance) The contract must be formed for a legal purpose. There must be consideration.

C. $5,000.00 in damages.

Huseyin and Ashish are negotiating the details of a new garage that Ashish plans to build on Huseyin's property. They agree on the building specs, the delivery date, and a price of $25,000. Ashish draws up the contract and sends it to Huseyin to sign. Huseyin reviews the contract and notices the price is listed as $2,500 instead of $25,000. Elated at the unbelievably low price, Huseyin quickly signs the contract and sends it back to Ashish, who signs it as well. If Ashish later tries to rescind the contract due to the mistaken price: A. Ashish will not be successful, because parol evidence is not admissible to disprove the terms of a written contract. B. Ashish will not be successful, because a unilateral mistake is not a basis to rescind a contract. C. Ashish will be successful, because it is a mathematical mistake that Huseyin was aware of. D. Ashish will be successful, because the parties made a mutual mistake.

C. Ashish will be successful, because it is a mathematical mistake that Huseyin was aware of.

Which mistake is likely to be voidable? A. Unilateral mistake B. A prediction mistake C. Bilateral mistake D. Mistakes of Value

C. Bilateral mistake

Aron, an agent for Bright Sales, Inc. (BSI), enters into an unauthorized contract with Consolidated Corporation (CC) purportedly on behalf of BSI, which refuses to perform. Aron is liable to

C. CC for misrepresentation

Common Carrier Corporation (CCC) employs Don as an agent. Without CCC's knowledge but otherwise acting within the scope of employment, Don commits a crime. The state can successfully prosecute

C. Don only

Elin, an agent for First Credit Corporation (FC), enters into an unauthorized contract with Great Expectations, Inc. (GE), purportedly on FC's behalf. This contract will be enforceable if it is ratified by

C. FC

Gavin and Allison are having drinks after work. After several rounds, the topic of Gavin's sports car comes up. Gavin is extremely proud of his sports car and brags about it all the time. To impress Allison, Gavin offers to sell Allison his expensive sports car for $5,000. Allison jumps at the deal, because she knows the car is worth much more than $5,000. They even write the "deal" down on a napkin, and both Gavin and Allison sign the napkin. The next morning, when Allison brings $5,000 to purchase the sports car, Gavin explodes. Gavin tells Allison that he was just kidding and that he would never sell his expensive sports car for such a low price. When Allison tries to enforce the deal: A. Either Gavin or Allison can rescind the contract based on incapacity or ratify the contract. B. Neither Gavin nor Allison can rescind the contract because it is in writing. C. Gavin can either rescind the contract based on incapacity or ratify the contract. D. Allison can either rescind the contract based on incapacity or ratify the contract.

C. Gavin can either rescind the contract based on incapacity or ratify the contract.

Barb has been a children's day care provider for several years in the small town of Sallton. She has decided to give it all up and move to the big city for excitement and adventure. She sells her business to Ken, agreeing not to open a competing business within five miles of Sallton for a period of nine months. After five months of the big city life, Barb is broke and moves back to Sallton. She opens a small day care business. Ken sues on the non-compete clause. What is the most likely result? A. Barb wins. The agreement is not enforceable because it is not ancillary to a legitimate bargain. B. Barb wins. The agreement is not reasonable as to time. C. Ken wins. The agreement is enforceable. D. Barb wins. The agreement is denying her the right to do the only thing she knows how to do.

C. Ken wins. The agreement is enforceable.

Anwah runs an antique store that specializes in paintings and other types of artwork. Lionel visits Anwah's antique store and discovers a beautiful old painting in a gilded frame. Lionel is excited because it looks like a painting by Gomez that he saw in his art review class that is worth $5,000. Lionel asks Anwah to confirm that the painting is indeed a Gomez original. Anwah smiles and winks at him. Lionel purchases the painting from Anway for $1,500. When Lionel takes the painting to an art dealer, he discovers that the painting is nota Gomez original and is only worth $20. If Lionel tries to rescind the contract with Anwah: A. Lionel will not be able to rescind the contract because a mistake of value is a not a defense to a contract. B. Lionel will be able to successfully rescind the contract because the painting was not worth as much as Lionel believed it was worth. C. Lionel will be able to successfully rescind the contract because Anwah committed fraud. D. Lionel will not be able to rescind the contract because Anwah did not state that the painting was indeed a Gomez original.

C. Lionel will be able to successfully rescind the contract because Anwah committed fraud.

Lupita enters into a contract with Faith to purchase a used car. At the time they sign the contract, Lupita appears to be very intoxicated. Faith notices this but signs the contract anyway. If Lupita later decides she wants to get out of the contract: A. Lupita cannot get out of the contract if both parties signed it. B. Lupita can raise the issue of undue influence, because Faith took advantage of Lupita while she was drinking. C. Lupita can raise the defense of lack of contractual capacity due to intoxication. D. Lupita cannot get out of the contract even though she had been drinking excessively.

C. Lupita can raise the defense of lack of contractual capacity due to intoxication.

When Myrtle comes home from work one evening, she finds that her yard has been mowed and trimmed. Later, a man comes to collect for the yard work done. Myrtle refuses to pay for the work since she has never seen the man before and did not hire him to do her yard work. Which of the following answers is most accurate? A. This is an implied, unilateral contract and she must pay the price requested by the man. B. The court would order Myrtle to pay the reasonable value of the yard work because of the benefit conferred on her. C. Myrtle would not have to pay for the yard work. D. This is an express, voidable contract that either party may avoid.

C. Myrtle would not have to pay for the yard work.

Geraldo is the owner/manager of Geraldo's Cleaning Service, a firm that cleans office building. Geraldo has a team of seven employees who do a fantastic job. To encourage them to keep up the good work, Geraldo tells his employees that if they continue to work hard until the end of the quarter and if he is pleased with his profits at the end of the quarter, he will give them each a $100 bonus. At the end of the quarter, the company's profits were extremely high. Will Geraldo have to make good on his promise of a $100 bonus for each employee? A. No, Geraldo will not have to award the bonuses because the work of the employees is not valid consideration. B. Yes, Geraldo will have to award the bonuses because profits were extremely high. C. No, Geraldo will not have to award the bonuses because his offer of a $100 bonus if he is pleased with his profits was an illusory promise. D. Yes, Geraldo will have to award the bonuses because the work of the employees is valid consideration.

C. No, Geraldo will not have to award the bonuses because his offer of a $100 bonus if he is pleased with his profits was an illusory promise.

What factors are used to judge if consideration is adequate to ensure a fair bargain? Choose 2 answers. A. Consideration must be a promise to pay money. B. Items or promises exchanged must be of nearly equal value. C. Promises must be made with voluntary consent. D. Promises exchanged may not be a preexisting duty.

C. Promises must be made with voluntary consent. D. Promises exchanged may not be a preexisting duty.

Roz and Sara work as clerks in Trina's Hot Clothes Shop. Trina withholds federal taxes from their pay, and controls the methods and details of the performance of their work. Roz and Sara are not authorized to modify the prices or other terms of a sale at the shop. Trina authorizes Roz to sell clothes at remote locations at prices that Liz negotiates in those locations. With respect to sales at those locations, Roz is

C. Trina's agent and employee

C. Trina's agents and employees

In what situation is a minor most likely to be able to terminate a contract? A. When a minor lied about his or her age when making the contract B. When the minor purchases food C. When a minor orders books for school D. A minor entering into a marriage contract

C. When a minor orders books for school

If unforeseen difficulties arise during the performance of a contract, may the parties change the terms of the contract without giving additional consideration? A. No, both parties must provide new consideration. B. Yes, but only if the modification is a rescission of the contract. C. Yes, if the modification is fair and equitable. D. No, at least one of the parties must provide additional consideration.

C. Yes, if the modification is fair and equitable.

Which of the following types of property would be considered "goods" under the Uniform Commercial Code? A. a promissory note B. a patent C. a computer D. a stock

C. a computer

Sue is considering forms of business organization for her construction-equipment business. For purposes of owning property and being a party to litigation, the form that is not a legal entity separate from its owner is

C. a sole proprietorship

Eve and Fran want to market a new line of cooking appliances. To be taxed the same as a partnership but enjoy limited liability, they should form

C. an S corporation

Carol hires Dick to act as her agent in the purchase of an office building. Carol does not want the seller to know that she is the buyer, so she asks Dick to represent that he is buying the building for himself. Carol is

C. an undisclosed principal

Dan is considering forms of business organization for his financial advisory firm. Like most states, Dan's state requires that to form a limited liability company, he must file with a central state agency

C. articles of organization

Coast-to-Coast Distribution, Inc., is a direct-mail distribution company. Like most corporations, Coast-to-Coast's employees include its

C. board of directors

Fran is a director of Global Enterprises, Inc. To the corporation, Fran owes a duty of

C. care and loyalty

Jayden is restoring a house for Jane when Hurricane Emma hits and washes out the foundations of the house. The cost for restoration has just increased by 400%. Under what principle may Jayden's obligations be excused? A. impossibility B. insurable interest C. commercial impracticality D. statute of limitations

C. commercial impracticality

Forcing a party to agree to the terms of a contract through the use of threats or blackmail is called: A. usury. B. adhesion. C. duress. D. undue influence.

C. duress.

Web Designs, Inc., is a close corporation. Web Designs is

C. generally allowed to restrict transfer of stock.

43.Trademark

Coca-Cola and McDonald's have symbols that identify their company. What term is used to identify their symbols?

accounts, goodwill, and literary rights

Collateral is the property that is subject to the security interest, and may include intangibles. Intangibles include ________.

Sylvia agrees to deliver one hundred computers to Ralph's Tech Store by Saturday. On Friday, Sylvia delivers ninety-nine computers. Ralph's Tech Store refuses to accept the shipment and accuses Sylvia of breaching the contract. By not delivering the entire one hundred computers, Sylvia: A. has not materially breached the contract and can recover the full contract price from Ralph's Tech Store without any further action on Sylvia's part. B. has materially breached the contract and must forfeit any payment for the computers. C. has not materially breached the contract and will be allowed the opportunity to cure by providing the one remaining computer. D. has materially breached the contract, and Ralph's Tech Store can sue for the amount it will take to get one more computer.

C. has not materially breached the contract and will be allowed the opportunity to cure by providing the one remaining computer.

Regional Products, Inc., hires Sam to act as its agent. Tina sues Regional for Sam's negligent conduct. Regional's right to sue Sam for an equal amount of damages is the right of

C. idemnification

Bart and Cary are directors of Digital Designs, Inc. Voting by Bart and Cary at corporate directors' meetings

C. must be done in person

Eve hires Frank to do some remodeling work in her office. The relationship between Eve and Frank is client and independent contractor. While working, Frank drops a tool on Gary, Eve's customer, causing an injury. Eve is

C. not liable because Frank is an independent contractor

Rescission of a contract will: A. forces the breaching party to pay a penalty fee for imperfect performance. B. transform unenforceable terms into enforceable ones. C. return the parties to the position they were in before the contract was formed. D. force the breaching party to perform their end of the bargain.

C. return the parties to the position they were in before the contract was formed.

Prospective Enterprises (PE) employs Quinn to buy property for a possible commercial development. Quinn secretly buys some of the property and sells it to PE at a profit. Quinn has breached

C. the duty of loyalty

A person who is mentally impaired generally can create only __________ contracts. A. unconscionable B. void C. voidable D. fraudulent

C. voidable

A court is unlikely to enforce the non-compete agreement Kelly and Amber signed because of which of the following clauses? A. Kelly agrees not to work for a competitor within a 10-mile radius of Amber's business. xB. All of these are correct. C. Kelly agrees to go into a completely different line of work than Amber. D. Kelly agrees not to work for a competitor for two years.

Can't find

Which of the following is true regarding state court jurisdiction?

Cases may fall under state jurisdiction, exclusive federal jurisdiction, or concurrent jurisdiction, and state courts have the power to hear all cases not within the exclusive jurisdiction of the federal court system.

The alteration will likely prohibit her from being a holder in due course.

She would not be considered a holder in due course, because a check is considered overdue 90 days after its date.

Check Cashing Business. Susan owns and operates a check cashing business. A customer, Bob, claiming to be Sam, came in and cashed a $2,000 check issued by ABC Trucking to Sam............. Both ABC Trucking and the issuer of the check to Maurice stopped payment on the checks. Susan claims that she was entitled to the status of a holder in due course and was entitled to payment on both checks. What is the effect on Susan's status as a holder in due course in taking the check from the customer that was four months old?

Which of these contracts would be enforceable, despite the existence of a mistake? Choose 2 answer choice

Christopher agrees to sell his washer and dryer to Ella in "as is" condition. Ella thinks the set is in excellent condition and is willing to take a chance on buying it. Neither works after a few weeks of use. Christopher agrees to sell his washer and dryer to Ella. Ella thinks the dryer uses gas instead of electricity, but she is incorrect

Which of these contracts would be enforceable, despite the existence of a mistake? Choose 2 answer choices.

Christopher agrees to sell his washer and dryer to Ella. Ella thinks the dryer uses gas instead of electricity, but she is incorrect. Christopher agrees to sell his washer and dryer to Ella in "as is" condition. Ella thinks the set is in excellent condition and is willing to take a chance on buying it. Neither works after a few weeks of use.

What element of a contract refers to both parties receiving some measurable benefit?

Consideration

Which of the following can be characterized as an exculpatory clause? a. Contractor is not liable for damage caused by its employees. b. All of these are correct. c. Creditor charges 45% interest on a loan. d. Buyer agrees to pay $5,000 for a used cell phone.

Contractor is not liable for damage caused by its employees.

Which of the following is not an exception to the parol evidence rule?

Contracts that are complete

Which of the following is not an intentional tort against economic interests?

Conversion

Which of the following is true regarding the personal liability of corporate executives for a business crime?

Corporate executives may be found personally liable for a business crime regardless of whether the business crime was committed for personal benefit or for the benefit of the corporation. Correct

False

Corporate stocks are treated as goods under the UCC.

In general, certain terms must be included in contracts to satisfy the requirement of definiteness. What are the exceptions to this rule? Choose 2 answer choices. Courts can complete a contract to supply some missing items. If the contract is in writing, not all terms are required to be included. Sales contracts under the UCC Courts can rewrite contracts even if the intent is vague.

Courts can complete a contract to supply some missing items. Sales contracts under the UCC

Match the term with the appropriate definition.

Covenant not to compete: A contractual promise to refrain from competing with another party for a certain period of time and within a certain geographic area. Reformation: A court-order correction of a written contract so that it reflects the true intentions of the parties.

Mary hires Nins, a real estate broker, to sell her warehouse. The warehouse burns down before being sold. Nina is

D. no longer Mary's agent

Logan agrees to deliver fifty pounds of crab claws to Dominique by May 15. Dominique needs the crab claws for a wedding party that Dominique is catering on May 16, so time is of the essence of the contract. Logan contacts Dominique on May 15 and tells Dominique that the earliest Logan can deliver the crab claws is on May 17. Dominique cancels the order and quickly makes other arrangements for the wedding party she is catering. Logan then demands payment from Dominique for the full contract price, and Dominique refuses. If Logan sues Dominique for damages under the contract: A. Dominique will have to pay or be in breach of contract. B. Dominique will have to pay, but Logan must deliver the crab claws. C. Dominique will have to pay Logan the difference between what Logan was charging for the crab claws and what Dominique eventually paid. D. Dominique will not have to pay because Logan breached the contract.

D. Dominique will not have to pay because Logan breached the contract.

Evan offers to sell his 2016 John Deere Tractor to Jorge for $30,000. Jorge accepts and promises to meet Evan on Saturday to make the exchange. On Thursday, a fire on Evan's farm totally destroys the tractor. Jorge is upset, because the price of the tractor was really good, and he knows he cannot get another one for that price. If Jorge sues Evan for breach of contract, the likely result will be that: A. Evan's performance under the contract will be excused due to material alteration. B. Evan will have to pay Jorge the difference between the sales price of the tractor and the price Jorge must pay to find a replacement. C. Evan must find a replacement tractor for Jorge, because the court is likely to award specific performance as a remedy. D. Evan's performance under the contract will be excused due to impossibility of performance.

D. Evan's performance under the contract will be excused due to impossibility of performance.

Which of the following scenarios describes an offer? A. KD Lamp Company sends out a catalog to customers that lists prices for various types of light bulbs. B. Raoul asks Wendy if she would be willing to sell her first-edition copy of War and Peace. Wendy replies, "I couldn't possibly part with that book for less than a couple thousand dollars." C. Nestor places an antique pocket knife, which he inherited from his father, up for auction. He tells the auctioneer that he hopes to get at least $250 for the knife. D. Luther says to Consuela, "My son needs tutoring in Spanish. I'd like you to come to my home on Monday and Wednesday nights beginning next week for two-hour sessions, and I'll pay you $40 per hour. I'd like you to tutor him for the next three months."

D. Luther says to Consuela, "My son needs tutoring in Spanish. I'd like you to come to my home on Monday and Wednesday nights beginning next week for two-hour sessions, and I'll pay you $40 per hour. I'd like you to tutor him for the next three months."

Selma wants to buy Matilda's house. Selma has been admiring the house for a long time and has asked Matilda repeatedly to sell the house to her, but Matilda has always refused. Finally, Selma tells Matilda that if Matilda does not sell Selma the house, Selma will kill Matilda's daughter. Afraid for her daughter's life, Matilda signs the contract to sell the house to Selma. If Matilda later tries to rescind the contract: A. Matilda may rescind the contract on the grounds that she signed the contract under duress.Matilda may rescind the contract on the grounds of unconscionability. B. Matilda may not rescind the contract because it has all the elements of a valid contract. C. Matilda may rescind the contract on the grounds of undue influence. D. Matilda may rescind the contract on the grounds that she signed the contract under duress.

D. Matilda may rescind the contract on the grounds that she signed the contract under duress.

Which type of lack of capacity is easiest to prove? A. Intoxication B. Mental incompetence C. Contracting for necessities D. Minor status

D. Minor status

You collect antiques and regularly travel the country looking for good deals. In your wanderings, you find an old fiddle and offer the owner $5. The owner accepts, and you take your treasure home. After you get the fiddle home and do your research on it, you discover the fiddle is actually worth $5,000. What a find!What do you think would happen if the owner tried to cancel the contract and get the fiddle back? A. Mutual mistake is not a valid defense to a contract, so the owner could not get his fiddle back. B. Mistake of value is a valid defense to a contract, so the owner could get his fiddle back. C. Mutual mistake is a valid defense to a contract, so the owner could get his fiddle back. D. Mistake of value is not a valid defense to a contract, so the owner could not get his fiddle back.

D. Mistake of value is not a valid defense to a contract, so the owner could not get his fiddle back.

Anna purchases a wedding dress and takes the dress to Jessica for alteration. Anna and Jessica agree that Anna will pay Jessica $75 for the alterations. After Jessica begins working on the dress, she has second thoughts. Jessica contacts Anna and advises her that the alternations will cost $150 instead of $75. Because Anna's wedding is in just two weeks, Anna reluctantly agrees. Once the alterations are completed, Anna pays Jessica the $75 originally agreed on. Is Jessica entitled to the additional $75? A. Yes, Jessica is entitled to the additional $75 because the original contract contained insufficient consideration. B. Yes, Jessica is entitled to the additional $75 because Anna agreed to it, forming a valid contract. C. No, Jessica is not entitled to the additional $75 because contracts cannot be altered once the terms are agreed on. D. No, Jessica is not entitled to the additional $75 because there is no additional consideration for the revision to the contract

D. No, Jessica is not entitled to the additional $75 because there is no additional consideration for the revision to the contract

Would one party's mistaken belief about the law governing a contract be enough to rescind the contract? A. Yes, even if the other party had no knowledge about the mistake. B. Yes, because it is a mistake about the law. C. No, because a mistake about the law is not factual. D. No, because it is unilateral and concerns the law.

D. No, because it is unilateral and concerns the law.

Will a mistake in value of the subject of the contract allow a contract to be rescinded? A. No, if only one party was mistaken. B. Yes, but only if the contract is for less than $250. C. Yes, if both parties were mistaken. D. No, even if both parties were mistaken.

D. No, even if both parties were mistaken.

Kellen is selling a vehicle which has been previously been in an accident and which shows obvious damage. If he does not tell the buyer about the accident, has he committed fraudulent misrepresentation? A. Yes, because the vehicle history is a material fact. B. Yes, even though the damage is obvious. C. No, because it would be inappropriate and not justifiable for a buyer to rely on any of his representations. D. No, if the buyer does not ask about the vehicle history.

D. No, if the buyer does not ask about the vehicle history.

Which situation would be considered sufficient consideration for a contract to exist? A. Alice's grandson quit smoking, so Alice promises to give him $5,000. B. Alice promises to give her granddaughter $10,000. C. Bethany is remodeling a kitchen for Tonya. Bethany tells Tonya she will finish the work within a reasonable time if Tonya pays her a bonus. D. Pam agrees to pay Derek $500 if he does not sit next to her in class anymore.

D. Pam agrees to pay Derek $500 if he does not sit next to her in class anymore.

Cody contracts with Drew to act as her agent in a fraudulent marketing scheme. Cody does not successfully complete the scheme. Drew can recover from Cody for

D. none of the above

If a buyer agrees to purchase "all the widgets I require" and the seller agrees to sell him "all the widgets you require" is there sufficient consideration? A. No, because without knowing the number of widgets, there can be no bargained-for exchange. B. No, this is illusory. C. Yes, because this is an output contract. D. Yes, because this is a requirements contract.

D. Yes, because this is a requirements contract.

You agree to paint your neighbor's house for a certain price. You get ninety percent of the painting done and then have to leave town for your real job. Your neighbor is pretty mad because you didn't finish the job, and says she is not going to pay you a penny!What do you think will happen when you try to collect payment from your neighbor for painting her house? A. You will probably receive nothing because you did not finish the job. B. You will probably receive the cost of your materials. C. You will probably receive the full contract price. D. You will probably receive the price you agreed on, less the amount it will take for her to have the painting finished.

D. You will probably receive the price you agreed on, less the amount it will take for her to have the painting finished.

What type of condition specifies an event that must happen before a person is obligated to perform the duties specified in the contract? A. a condition subsequent B. a condition specific C. a condition concurrent D. a condition precedent

D. a condition precedent

In a bilateral contract, the consideration which supports the forming of the contract is: A. a past promise. B. an act C. a past act. D. a promise to perform.

D. a promise to perform.

Fred starts up, and assumes the financial risk of, Graphic Ads, a new enterprise. Fred is

D. a sole proprietor

What is the term for the legal ability to enter into a binding contract?A. emancipation B. legal capability C. mental competence D. contractual capacity

D. contractual capacity

In January, Victor contracted with Delrita to cater a Cinco de Mayo (May 5th raised to the th power) party for 500 of his closest friends. Neither of them anticipated that their entire state would be under stay-at-home orders on May 5 due to a global pandemic. Under what principle may Victor cancel his contract with Delrita? A. time is of the essence B. commercial impossibility C. statute of limitations D. frustration of purpose

D. frustration of purpose

Lyn may hire employees to work in the Main St. Computer Store that she manages despite the fact that her employment agreement with Main St. says nothing about her being able to hire employees. This is

D. implied authority

Lawrence took out a life insurance policy in which his daughter, Madeline, is named as a beneficiary. Madeline is a(n) A. promisor. B. obligor. C. incidental beneficiary. D. intentional beneficiary.

D. intentional beneficiary.

Johann, a well-known musician, agrees to give ten guitar lessons to Elton for $2,000. Nothing in the contract itself prohibits a delegation. If Johann delegates his obligation to Eugene, a second-year musical student and enthusiastic guitar player, then the delegation will probably be A. permitted because contracts may be freely delegated. B. permitted because the contract is just for music lessons. C. prohibited by the UCC because this is a sale of services. D. prohibited because the contract is for service from a specific person.

D. prohibited because the contract is for service from a specific person.

Glen is an agent for High Flight, Inc. On High Flight's behalf and at its request, Glen pays Ilsa for certain plane maintenance and repair services. Glen's right to obtain the amount of those payments from High Flight arises under the principal's duty of

D. reimbursement

Shania offers to sell her lakefront property to Tonya for $150,000, and Tonya agrees to buy it. Tonya and Shania both sign the real estate contract, but, before they close the deal, Shania learns that a new resort is being opened on the lake. The opening of the resort will drive property prices up in the area, so Shania believes she can sell her property to someone else and get a better price on the deal. Shania tells Tonya that she has decided not to sell the property to Tonya. If Tonya sues to enforce the contract, a court will likely: A. award monetary damages to Tonya. B. grant specific performance by requiring Shania to find a comparable piece of land for Tonya at a comparable price C. not enforce the contract, because people are free to choose to whom they sell their property. D. require Shania to go through with the sale.

D. require Shania to go through with the sale.

Under a contract for the sale of land, the Statute of Frauds A. does not apply if the purchase price for the land is less than $500. B. does not apply if the total price of the land is to be paid in less than one year. C. does not apply if the buyer must secure a loan for the purchase of the land. D. requires the defendant to sign the agreement.

D. requires the defendant to sign the agreement.

As a corporation, Beta Company can pay its dividends from

D. retained earnings

Pam is an agent for Refined Chemicals Corporation. Refined Chemicals owes Pam the duty of

D. safe working conditions

Jean and Bathan want to incorporate to market DVD products. The first step in the incorporation procedure is to

D. select a state in which to incorporate

Landscape Supply agrees to provide Delta Lawn Service eight pallets of sod for the price of $260 per pallet. The agreement contains the following provision: "This Agreement may not be amended or modified except by an instrument in writing signed by the party to be charged with such amendment or modification." Delta decides it now needs 160 pallets of sod, and Landscape is willing to reduce the price to $255 per pallet because of the increased amount. Delta and Landscape can accomplish this change to the contract by: A. signing an amendment or rewriting the entire contract to include the changed provisions only. B. crossing out the incorrect language and replacing it by hand with the correct terms only. C. crossing out the incorrect language and replacing it by hand with the correct terms or rewriting the entire contract to include the changed provisions. D. signing an amendment, crossing out the incorrect language and replacing it by hand with the correct terms, or rewriting the entire contract to include the changed provisions.

D. signing an amendment, crossing out the incorrect language and replacing it by hand with the correct terms, or rewriting the entire contract to include the changed provisions.

What is the term for when a party to a contract performs his duties exactly according to the terms of the contract? A. substantial performance B. perfect performance C. specific performance D. strict performance

D. strict performance

Ida hires Jim, a real estate broker, to act as her agent to sell her land for $10,000. Oil is discovered beneath the land, causing its market value to increase one hundred-fold. The agency agreement is likely

D. terminated by operation of law

When a contract falls within the Statute of Frauds but is not in writing, the contract is A. illegal. B. void. C. voidable. D. unenforceable.

D. unenforceable.

In order for an accord and satisfaction to be valid, the debt must be: A. over a year old. B. of fair market value for the exchange that took place. C. liquidated. D. unliquidated.

D. unliquidated.

Quinn employs Roy as his authorized business agent on April 1. Quinn's son Stan petitions a court to declare Quinn mentally incompetent. The court grants Stan's request on May 1. Roy enters into a contract on Quinn's behalf on May 15, before Roy knows of the court's action. The contract is

D. void

Which of the following would NOT be considered an exculpatory clause that a court would hold as contrary to public policy and therefore unenforceable?

Exculpatory clauses in bungee-jumping contracts

Dominique will not have to pay because Logan breached the contract.

Due on Receipt, Inc., makes tax software, which is packaged with a shrink-wrap agreement. Evenflo Products Company distributes the software to retailers, including a Flatprice discount store, where Greta buys a package of it. The parties to the shrink-wrap agreement are

Due on Receipt and Evanflo only

Jamie is building a house on her lot. She invites Earnie of Earnie's Excavation to bid on the excavation job. Earnie observes that the lot next to Jamie's is also under excavation and the soil in that lot is normal and not excessively rocky. Based on the assumption that the soil in Jamie's lot will be similar, he and Jamie agree that the excavation will cost $3,000. When Earnie starts digging, he learns there is solid rock under Jamie's lot. Earnie says it will cost an extra $2,500 for the excavation work. Jamie agrees just to get the job done but later refuses to pay a dime more than $3,000. If Earnie sues, the most likely result would be a. Earnie wins, as this modification is governed by the UCC and consideration is not required to enforce a modification of the agreement. b. Jamie wins, as Earnie was not acting in good faith and just wanted to put Jamie in a situation where she didn't have a choice but to agree to more money. c. Jamie wins, as Earnie was under a preexisting duty to dig the basement. d. Earnie wins, as the modification was due to unforeseen difficulties.

Earnie wins, as the modification was due to unforeseen difficulties.

Travel Lines offered to sell 10 round-trip tickets to Elaine. Travel Lines stated that the acceptance must be in writing by USPS next-day service. Which of the following acceptances will create a contract between Travel Lines and Elaine? a. Elaine sends a fax to Travel Lines stating she will buy the tickets. b. Elaine calls Travel Lines and states that she will buy the tickets. c. All of the these responses will create a contract between Travel Lines and Elaine since they constitute reasonable means of communication. d. Elaine sends a letter by USPS next-day service to Travel Lines stating that she will buy the tickets.

Elaine sends a letter by USPS next-day service to Travel Lines stating that she will buy the tickets.

1. Question: Donald Waide had a contracting business. He bought most of his supplies from Paul Bingham's supply center. Waide fell behind on his bills, and Bingham told Waide that he would extend no more credit to him. That same day, Donald's father, Elmer Waide, came to Bingham's store and said to Bingham that he would "stand good" for any sales to Donald made on credit. Based on Elmer's statement, Bingham again gave Donald credit, and Donald ran up $10,000 in goods before Bingham sued Donald and Elmer. What defense did Elmer make, and what was the outcome? Strategy: This was an oral agreement, so the issue is whether the promise had to be in writing to be enforceable. Review the list of six contracts that must be in writing. Is this agreement there?

Elmer made a promise to pay the debt of another. He did so as a favor to his son. This is a collateral promise. Elmer never signed any such promise, and the agreement cannot be enforced against him.

Treating or proposing to treat someone unfavorably...because of personal characteristics that is protect by law

Employment discriimination

Which of the following is a valid offer? Arun distributes flyers at work stating he wants to sell his house, listing the address and the asking price. Arun tells Eric he will sell one of his houses for $250,000 by the end of the summer. Eric offers to buy Arun's house for $290,000. Arun says, "No, but I will sell it to you for $300,000." Eric seems to be upset, so Arun says he will sell it for $290,000. Eric offers to buy Arun's house for $775,000 with no contingencies because Eric's lease ends in two months. Arun wants to think about it and six days later has not yet responded.

Eric offers to buy Arun's house for $775,000 with no contingencies because Eric's lease ends in two months. Arun wants to think about it and six days later has not yet responded.

Evan's performance under the contract will be excused due to impossibility of performance.

Evelyn will probably receive the contract price less the cost to replace the pool liner with a fiberglass liner.

Which of the following statements is true regarding negligent misrepresentation?

Even if there is no actual intent to deceive, the person making the false statement is treated as having intent to deceive.

What evidence outside of the written contract is a party allowed to present? Choose 2 answer choices.

Evidence showing a change to the contract after it is signed Evidence to prove agreement on an essential element of the contract

What evidence outside of the written contract is a party allowed to present? Choose 2 answer choices. Evidence to prove agreement on an essential element of the contract Verbal negotiations leading to the signing of the contract Evidence showing an agreement that is different from the contract that the parties agreed to before the contract was signed Evidence showing a change to the contract after it is signed

Evidence to prove agreement on an essential element of the contract Evidence showing a change to the contract after it is signed

Melissa felt pressured into signing a contract that released her employer from any liability if she is injured on the job. What prohibited behavior under public policy could this be?

Exculpatory Clause

An apparent agency.

High Maintenance. What type of agency, if any, did Jane have to act on behalf of Paul as far as Pam is concerned?

Paul will win, because he did nothing to cause Harry to believe that he would pay for the

High Maintenance. Which of the following is the most likely result if Harry sues Paul for the price of the jacket?

Hot Dresses, Inc.

Hot Dress. Doreen writes a check for a dress to Hot Dresses, Inc., a small specialty shop owned primarily by Betty.......... Which of the following parties is the holder of the check?

Doreen

Hot Dress. Doreen writes a check for a dress to Hot Dresses, Inc., a small specialty shop owned primarily by Betty............ Which of the following parties would be considered the drawer of the check Doreen presented to Betty at Hot Dresses, Inc.?

An implied warranty of merchantability.

Hot Toaster. Based on the facts presented, what type of warranty did Super Store give Rebecca?

Samantha did not make an implied warranty of fitness for a particular purpose, because there is no proof that Rebecca was relying on Samantha to make the selection.

Hot Toaster. Rebecca bought a toaster from Super Store and brought it home. Which of the following is true regarding whether Samantha made an implied warranty of fitness for a particular purpose to Rebecca that the blender would make smoothies?

Samantha did not make an express warranty.

Hot Toaster. Which of the following is true regarding whether Samantha made an express warranty to Rebecca that the blender would make smoothies?

Which of the following statements is an offer?

I will sell you my house for $400,000.

Destruction of the Subject Matter

I. A luxury car dealer offers to sell you a rare 1938 Bugatti for $7.5 million if you bring cash the next day. You arrive, suitcase stuffed with cash—just in time to see a stampeding herd of escaped circus elephants crush the Bugatti. The dealer's offer terminated.

Rejection

I. A rejection occurs when offerees clearly indicate that they do not want to take the offer. II. A rejection immediately terminates the offer.

Invitations to Bargain

I. An invitation to bargain is not an offer. II. Person calls friend and asks if they would consider selling condo. Friends says there is no way I could under $435k. Person sends friend a cashiers check. Person does not own condo because friends message was not an offer. It was just an invitation to bargain.

Revocation

I. An offer is revoked when the offeror "takes it back" before the offeree accepts. II. In general, the offeror may revoke the offer any time before it has been accepted.

Making an Offer

I. Bargaining begins with an offer. II. The person who makes an offer is the offeror. III. The person to whom the offer is made is the offeree. IV. The terms are annoying but inescapable because, like handcuffs, all courts use them. V. The terms are annoying but inescapable because, like handcuffs, all courts use them. a. The terms are annoying but inescapable because, like handcuffs, all courts use them.

Termination of Offers

I. If they are vague, then even if the offeree agrees to the deal, a court does not have enough information to enforce it, and there is no contract. II. But this power is lost when the offer is terminated, which can happen in several ways.

Problems with Definiteness

I. It is not enough that the offeror indicates the intention to enter into an agreement. The terms of the offer must also be definite. II. If they are vague, then even if the offeree agrees to the deal, a court does not have enough information to enforce it, and there is no contract. III. Definite: I want you to work at my store for $15/hour. Indefinite: I want you to work at my store and we will work out the wage later. a. There is no binding contract

agreement

I. Parties form a contract only if they have a meeting of the minds. II. For this to happen, one side must make an offer and the other must make an acceptance. a. For this to happen, one side must make an offer and the other must make an acceptance.

Mirror Image Rule

I. The common law mirror image rule requires that acceptance be on precisely the same terms as the offer. II. If the acceptance contains terms that add to or contradict the offer, even in minor ways, courts generally consider it a counteroffer.

What rights does a third-party beneficiary to a contract hold in regard to that contract?

If the third party is an intended beneficiary of the contract, the third party has the right to sue either the promisor or the promisee.

The UCC and the Battle of the Forms

I. This practice creates enormous difficulties. Sellers use forms they have prepared, with all conditions stated to their advantage, and buyers employ their own forms, with terms they prefer. II. The forms are exchanged in the mail or electronically, with neither side clearly agreeing to the other party's terms. a. The problem is known as the "battle of forms." III. Under the UCC, an acceptance that adds additional or different terms often will create a contract. And, perhaps surprisingly, the additional terms will often become part of the contract. IV. UCC §2-207 dramatically modifies the mirror image rule for the sale of goods. V. Under this provision, an acceptance that adds additional or different terms will often create a contract. The rule is intricate, but it may be summarized this way: a. For the sale of goods, the most important factor is whether the parties believe they have a binding agreement. If their conduct indicates that they have a deal, they probably do. b. If the offeree adds new terms to the offer, acceptance by the offeror generally creates a binding agreement. c. If the offeree changes the terms of the offer, a court will probably rely on general principles of the UCC to create a fair contract. d. If a party wants a contract on its terms only, with no changes, it must clearly indicate that.

Expiration

I. When an offer specifies a time limit for acceptance, that period is binding. II. If the offer specifies no time limit, the offeree has a reasonable period in which to accept.

holder

If Adam Brewer possesses a check that states "Payable to Adam Brewer," Adam is a(n) ________.

Bernie owes an undisputed amount to Wilde's Heating & Air Conditioning. Which of the following is true? a. The undisputed amount is also known as an unliquidated amount. b. If Wilde's agrees to accept less than the full amount, the agreement is only binding if it is in writing and signed by Bernie. c. If Wilde's agrees to accept less than the full amount as full payment, the agreement is not binding. d. If the parties agree to settle for less than the full amount, their agreement is governed by the ruling in Henches v. Taylor.

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

False

If a buyer accepts nonconforming goods, the buyer may not seek damages.

bearer

If a negotiable instrument is payable to whomever possesses it, then it is a(n) ________ instrument.

exclusive

If a principal agrees to hire no other agent for a period of time or until a particular job is done, the principal and agent have entered into a(n) ________ agency contract.

That the warrantor of the instrument is entitled to enforce the instrument.

If an instrument is not an unaccepted draft presented to a drawee, which of the following presentment warranties is applicable?

demand

If an instrument is silent as to the time of payment, the Uniform Commercial Code presumes that it is a ________ instrument.

False

If an owner entrusts the possession of goods to a merchant who deals in goods of that kind, the merchant cannot transfer ownership rights in the good to a buyer in the ordinary course of business.

The parties are excused from performance.

If goods are identified at the time the parties entered into a contract and these goods are destroyed through no fault of the parties before risk passes to the buyer, which of the following is true?

In what situations would a court be likely to award a quasi-contract? Choose 2 answer choices. When the party provided the services for unwilling recipients If the defendant did not know the plaintiff would expect to be paid for the services If the defendant was unjustly enriched and played a part in deceiving the plaintiff When the unjust enrichment is a relatively insignificant amount of money

If the defendant was unjustly enriched and played a part in deceiving the plaintiff When the unjust enrichment is a relatively insignificant amount of money

Before midnight of the next banking day

If the party that dishonors an instrument is a collection bank, when must the collecting bank give notice of the dishonor to a secondarily liable party?

Disparate-impact

In which of the following types of cases does a plaintiff attempt to prove that while an employer's policy or practice appears to apply to everyone equally, its actual effect is that it disproportionately limits employment opportunities for a protected class?

Lilly hired Harris Lawn Service to cut her grass one summer, and paid through automatic charges to her credit card. After taking three months off for winter weather, Harris staff cut Lilly's grass for four weeks in a row before charging the fees on Lilly's credit card. Lilly protested the charges, stating she did not hire the company to cut grass for the second summer. Harris sues Lilly. What law applies? Choose 2 answer choices. Lilly's silence is not acceptance and Harris's service in the spring is considered a gift to her. Lilly's silence is acceptance because of the parties' past dealings. Lilly's silence is not acceptance in this case because the offeree must affirmatively accept the terms of the offer in full and communicate that acceptance to the offeror. Lilly's silence is acceptance because the offeree accepted the benefit offered.

Lilly's silence is acceptance because of the parties' past dealings. Lilly's silence is acceptance because the offeree accepted the benefit offered.

Lionel will be able to successfully rescind the contract because Anwah committed fraud.

True

Liquidated damages are identified before a breach of contract occurs.

The following scenario describes an offer

Luther says to Consuela, "My son needs tutoring in Spanish. I'd like you to come to my home on Monday and Wednesday nights beginning next week for two-hour sessions, and I'll pay you $40 per hour. I'd like you to tutor him for the next three months."

Which of the following scenarios describes an offer? a. KD Lamp Company sends out a catalog to customers that lists prices for various types of light bulbs. b. Nestor places an antique pocket knife, which he inherited from his father, up for auction. He tells the auctioneer that he hopes to get at least $250 for the knife. c. Raoul asks Wendy if she would be willing to sell her first-edition copy of War and Peace. Wendy replies, "I couldn't possibly part with that book for less than a couple thousand dollars." d. Luther says to Consuela, "My son needs tutoring in Spanish. I'd like you to come to my home on Monday and Wednesday nights beginning next week for two-hour sessions, and I'll pay you $40 per hour. I'd like you to tutor him for the next three months."

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? a. Neither offer is valid. Who would ever pay $1,000 or $1,500 for a beer can collection? b. If Carl rejects Mary's counteroffer, she can still accept Carl's offer of $1,500. c. Mary's offer is an option contract and she cannot revoke the offer. d. Mary's counteroffer terminates Carl's offer of $1,500.

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

Matilda may rescind the contract on the grounds that she signed the contract under duress.

Juan agrees to paint Michelle's house for $1,000. Halfway through the job, Juan tells Michelle that he will need an extra $250 to finish the job. Which of the following is a correct evaluation of the situation? a. Michelle will not have to pay the extra $250 because Juan made an illusory promise about only charging $1,000. b. Michelle will not have to pay the extra $250 because Juan has a preexisting duty to paint the house for $1,000. c. Michelle will have to pay because she and Juan did not have a bargained-for exchange. d. Michelle will have to pay the extra $250 because Juan has promised not to finish the job unless she does.b

Michelle will not have to pay the extra $250 because Juan has a preexisting duty to paint the house for $1,000.

Which type of lack of capacity is easiest to prove?

Minor status

Which type of lack of capacity is easiest to prove? Contracting for necessities Minor status Intoxication Mental incompetence

Minor status

Which type of lack of capacity is easiest to prove? Mental incompetence Minor status Contracting for necessities Intoxication

Minor status

21.Agency by estoppel

Mr. Campbell is the owner of the Van Video Store. Mr. Campbell told Mrs. Tanner that a salesperson in his store would receive the used videos she wanted to sell him. He had to leave to go on an errand. Frank was in the store browsing at some new video selections. Mrs. Tanner assumed that Frank was the salesperson. She left the videos, along with her name and phone number with Frank. When Mr. Campbell returned Frank gave the videos to him. What is Frank assumed to be by Mrs. Tanner?

When Myrtle comes home from work one evening, she finds that her yard has been mowed and trimmed. Later, a man comes to collect for the yard work done. Myrtle refuses to pay for the work since she has never seen the man before and did not hire him to do her yard work. Which of the following answers is most accurate? a. The court would order Myrtle to pay the reasonable value of the yard work because of the benefit conferred on her. b. Myrtle would not have to pay for the yard work. c. This is an express, voidable contract that either party may avoid. d. This is an implied, unilateral contract and she must pay the price requested by the man.

Myrtle would not have to pay for the yard work.

39.Trademark

NBA and NFL jerseys are sold with a distinctive mark. Which term identifies this mark on the jerseys?

Mid-American Oil had a contract with NSB Company to supply 1,000 gallons of oil by September 1. The contract contained a provision that required all modifications to be written and signed by the company presidents. In early August, an executive of Mid-American talked with the purchasing agent of NSB who orally agreed to two shipments of oil; one in September and the second one in December. By September 30, when only 500 gallons had been delivered, NSB sued. The likely outcome of this lawsuit is: a. Mid-American Oil wins because the UCC governs this case and no new consideration is required. b. NSB wins because the modification has to be in writing. c. Mid-American Oil wins because new consideration was present. d. NSB wins because the modification was not supported by new consideration.

NSB wins because the modification has to be in writing.

Undisclosed

Nasty Break-Up. What type of principal is Harold?

Alice is personally bound.

Nasty Break-Up. Which of the following is true regarding whether Alice is personally bound on the contract with Sarah?

Treating people unfavorably because they come from a particular country or because they have a particular ethnicity

National origin discrimination

No, Geraldo will not have to award the bonuses because his offer of a $100 bonus if he is pleased with his profits was an illusory promise.

No, Jessica is not entitled to the additional $75 because there is no additional consideration for the revision to the contract.

Veronica agrees verbally to paint a picture of Sheridan's prize-winning dog for $2,000. After she paints the picture Sheridan refuses to pay, stating that the agreement had to be in writing to be enforceable. Is Sheridan correct?

No, because this is a customized good, and the agreement would be enforceable without a writing

LaVon contracts with Nathan for Nathan to sing at her comedy club every Friday night in July. The first Friday, the crowd loved Nathan. The second Friday, they booed him. The next week, Nathan got a better offer, so he hired his twin brother Ethan to fill in for him at LaVon's club. Can LaVon compel Nathan to perform?

No, because you cannot compel performance of personal services under specific performance.

Yolanda was shoveling snow from her sidewalk, and just to be nice, she also shoveled snow from her neighbor Melody's walk. The next day, Melody promises that she will pay Yolanda $25 for shoveling snow from her walk. Has a contract been created? a. No, Yolanda had a preexisting duty to shovel Melody's walk. b. Yes, Melody made a promise and that created the contract. c. No, past consideration is not valid consideration. d. Yes, Melody has a moral obligation to pay for the work, even if she didn't request it.

No, past consideration is not valid consideration

oy is a customer service representative. Joy's supervisor Tom tells Joy that because she was so good at "diffusing" a customer relations issue last month, he will pay her a $500 bonus. Is Tom's promise enforceable?

No, since this involves past consideration

Wendell, new to the area, selects a doctor from the telephone book and visits that doctor to have a splinter extracted. Unbeknownst to Wendell, the doctor has never passed the state licensing exams. Later, when Wendell discovers the truth, he refuses to pay his bill. If the doctor sues for recovery of the fee, will the court support the doctor's claim? a. It depends on whether Wendell's injury healed properly. b. Yes, it is unconscionable that Wendell would not pay a bill he owed. c. Yes, it was up to Wendell to verify the doctor's qualifications prior to having the splinter extracted. d. No, the court is likely to take the position that it is not in the public's best interest to enforce contracts with unlicensed doctors.

No, the court is likely to take the position that it is not in the public's best interest to enforce contracts with unlicensed doctors.

Fidelity Corporation offers to hire Ron to replace Monica, who has given Fidelity a month's notice of intent to quit. Fidelity gives Ron a week to decide whether to accept. Two days later, Monica decides not to quit and signs an employment contract with Fidelity for another year. The next day, Monica tells Ron of the new contract. Ron immediately faxes a formal letter of acceptance to Fidelity. Do Fidelity and Ron have a contract? Why or why not?

No. Revocation of an offer may be implied by conduct inconsistent with the offer. When the corporation hired someone else, and the offer learned of the hiring, the offer was revoked. The acceptance was too late.

Dyna tells Ed that she will pay him $1,000 to set fire to her store so that she can collect under a fire insurance policy. Ed sets fire to the store, buy Dyna refuses to pay. Can Ed recover? Why or why not?

No. This contract, although not fully executed, is for an illegal purpose and therefore is void. A loud contract gives rise to no legal obligation on the part of any party. A contract that is void is no contract. There is nothing to enforce.

If a contract is deemed unenforceable, what remedy is available to the parties?

None

Kera is an hourly employee of Xeon, Inc. who earns a wage of $10 an hour. During a busy season, Kera works fifty hours in one week. Xeon pays Kera $11 an hour for her overtime pay. Xeon is:

Not in conformance with the Fair Labor Standards Act because Xeon is obligated to pay no less than 1.5 times Kera's regular pay for hours she worked over forty in one week

Statute of Frauds

One Year Rule One of those types of non-written contracts is the agreement that cannot be Performed Within One Year. Under the one year rule, an oral agreement that cannot be performed within 12 months of creation must be in writing to be enforceable. The 12 month clock starts ticking the day after the agreement is formed and the rule applies to agreements that could necessarily take more than 12 months to complete or can possibly be performed within one year. 1677, an English statute called the Act for the Prevention of Frauds and Perjuries said that certain types of contracts must be in writing and signed by the parties to be enforceable. requires that certain types of contracts must be in writing in order to be enforceable. If one of these types of contracts is not in writing, the parties may proceed with the contract, but if one party does not perform the courts will not enforce the terms of the contract. In other words, if it is an oral agreement, it is a voidable contract from which either party can exit. Contracts related to land, including sales, easements, leases, and mortgages - Land is so unique that a particular piece of land and related property features cannot be duplicated. Contracts that cannot be performed within one year - This applies when performance within one year is objectively impossible. The concern in this case is that the parties cannot remember the terms of the contract and witnesses or evidence could be challenging to produce after a year or more.

What are the elements of promissory estoppel?

One party makes a promise knowing the other party will rely on it; the other party does rely on the promise; and the only way to avoid injustice is to enforce the promise

What are the differences between legal and equitable remedies? Choose 2 answer choices.

One requires actions instead of damages. One is monetary.

What type of jurisdiction do trial courts have?

Original

A purchase-money security interest

Overextended Debtor. .......... Which of the following is the term for the type of agreement Dennis had with ABC Electronics?

Dennis is wrong because the security interest perfected automatically.

Overextended Debtor. ............ Which of the following is correct regarding the statement of Dennis that the security interest was not perfected?

It is a consumer good.

Overextended Debtor. ..................... Which of the following is the proper designation under the Uniform Commercial Code for the television?

Which of the follows is not a duty the principal owes the agent?

Ownership of the principal's company

Which situation would be considered sufficient consideration for a contract to exist?

Pam agrees to pay Derek $500 if he does not sit next to her in class anymore.

Which situation would be considered sufficient consideration for a contract to exist? Alice promises to give her granddaughter $10,000. Alice's grandson quit smoking, so Alice promises to give him $5,000. Bethany is remodeling a kitchen for Tonya. Bethany tells Tonya she will finish the work within a reasonable time if Tonya pays her a bonus. Pam agrees to pay Derek $500 if he does not sit next to her in class anymore.

Pam agrees to pay Derek $500 if he does not sit next to her in class anymore.

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

Patrice may win under the doctrine of promissory estoppel.

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.

Common law exceptions to the at will doctrine include

Protected Classes: According to the federal equal employment opportunity laws enforced by the U.S. Equal Employment Opportunity Commission (EEOC), a covered employer cannot terminate an employee based on discriminatory reasons. Discriminatory firings include terminations based on gender, age (over 40), race, religion, disability, pregnancy or genetic information. Employment Contracts: If your employer signed an employment contract requiring a for-cause termination, you may be able to sue your employer for breach of contract. Generally, a court may not want to force parties to continue working together if doing so would be detrimental to either party. In this case, a court may award monetary damages for breach of contract. Retaliatory Termination: An employer cannot terminate an employee for exercising his legal rights. Thus, if you believed your employer engaged in employment discrimination, and you decided to report his bad conduct by filing a discrimination complaint with the EEOC, your employer cannot fire you as retaliation for exercising your legal rights to report him. Similarly, if you reported your employer for violating job safety regulations with the Department of Labor's Occupational Safety and Health Administration (OSHA), your employer cannot legally terminate you for doing so.

Which of the following refers to the extent to which, as a matter of policy, a defendant may be held liable for the consequences of his actions?

Proximate cause

When Austin, Texas decides to implement a new tax code that will impose a new tax on business owners within its city limits, which law is applicable?

Public law

notification

Pursuant to the duty of ________, the agent must communicate to the principal offers from third parties, and he or she must also communicate any information the agent thinks could be important to the principal.

To satisfy Uniform Commercial Code (UCC) Section 2-201, the contract or memorandum need only state which of the following with respect to the goods to be sold?

Quantity

These are contracts created by circumstances, where one person has done something for another or paid money on his behalf, and the other person enjoyed the benefits of the same

Quasi contract

Cheryl knows that Jake is looking to buy a new scooter. She sees one that would be perfect and negotiates with the seller on Jake's behalf. She signs a contract for the scooter using her name but clearly indicating that she is working for Jake. She actually is not. When Jake sees the scooter, he loves it and agrees to pay the contract price. If agency exists in this situation, it is agency by:

Ratification

Pads & Pods Corporation makes tablets, each of which is packaged with a shrink-wrap agreement. Reba buys a Pads & Pods tablet. The terms of the shrink-wrap agreement are most likely not enforceable if

Reba returns the tablet within the grace period

What is required to establish promissory estoppel?

Reliance on the defendant's promise A promise made by the defendant A contract is nonexistant

4.Employment at will

Roger was discharged from his job without cause. The employer has the right to terminate his employment without cause under which law?

Spencer will lose because Glen is an employee of Sally, who is an independent contractor for Bob.

Roofing Issues. Assuming Glen was negligent, which of the following is the most likely result in a lawsuit against Bob brought by Spencer?

She is an independent contractor.

Roofing Issues. Which of the following is the most likely characterization of Sally in relation to Bob?

Kantia finds out her boyfriend Romeo is secretly seeing Sabrina. Kantia confronts Sabrina and strikes Sabrina with her large, heavy purse. Sabrina catches Kantia's hand before she can swing at her again and pushes her back. What, if any, tort(s) has Sabrina committed?

Sabrina has not committed assault or battery because she acted in self-defense.

7.Americans with Disabilities Act

Sally is in a serious accident. She is paralyzed from the waist down, but can still perform her job with a reasonable accommodation. What protects her from losing her job, and requires her company to provide the accommodations to perform her job?

Seth told the salesperson at Outdoor Times that he wanted the sleeping bag that was advertised in the Sunday paper; one that would keep him comfortable if the temperature drops to 10 degrees Fahrenheit. The salesperson told Seth they were sold out of that bag, but there were two other styles that would meet his needs and were the same price. Seth insisted he wanted the advertised bag and threatened to sue for breach of contract. Which is true? a. Outdoor Times is guilty of "bait and swap." b. Seth will prevail in his case, as Outdoor Times is responsible for having sufficient stock of advertised items. c. Outdoor Times must provide Seth with a raincheck, ensuring he can buy the same bag at the sales price at a later date. d. Seth will not prevail, as the advertisement was simply a request for offers.

Seth will not prevail, as the advertisement was simply a request for offers.

9.Unemployment compensation

Shirley was laid off by her employer. What benefit is she entitled to receive?

Which is the most difficult part of establishing the defense of assumption of the risk?

Showing that the plaintiff assumed the risk of the actual harm suffered

Third Party Interests

Some contracts affect people other than the parties themselves

False

Specific performance usually allows the seller to deliver substitute goods to the buyer

Randy promises to give Stewart her iPod in exchange for Stewart's promise to pay Randy $50. This bilateral contract was created when

Stewart promised to pay Randy $50

$500

Stolen Purses. For how much can the bank hold Sandra responsible based on the fraudulent use of the card?

The customer must notify the bank to stop the payment at least three days before the preauthorized payment is scheduled.

Stolen Purses. Which of the following is true regarding the bank's obligation to end preauthorized payments?

How is substantial performance involved with the classification of material breaches versus immaterial breaches?

Substantial performance involves an immaterial breach.

40; 40

The Fair Labor Standards Act mandates that employees who are not excluded from its coverage and who work more than ________ hours in a week be paid no less than one and one-half times their regular wage for all the hours beyond ________ that they work during a given week.

The Family and Medical Leave Act covers private employers with ________ or more employees.

12; 12

The Family and Medical Leave Act guarantees all eligible employees up to ________ weeks of unpaid leave during any ________ month period for designated family-related occurrences.

Geraldo has been acquitted in an embezzlement case brought against him by the federal government. Federal prosecutors would like to try Geraldo again for the same crime. What constitutional protection, if any, does Geraldo have?

The Fifth Amendment's prohibition against double jeopardy

The Occupational Safety and Health Act (OSHA) is a federal statute

The Occupational Safety and Health Act of 1970 is a U.S. law establishing workplace standards to ensure that employees are protected from hazards that compromise their safety and health. The Occupational Safety and Health Act applies to most private sector employers and their workers, in addition to some in the public sector.

True

The Uniform Commercial Code defines a negotiable instrument as a written document that is signed by the maker or drawer with an unconditional promise or order to pay a sum certain in money on demand or at a time certain to bearer or to order.

tender conforming

The Uniform Commercial Code requires lessors to ________ goods to lessees.

conforming

The Uniform Commercial Code requires that buyers are obligated to accept and pay for ________ goods in accordance with the contract.

Bankruptcy Abuse Prevention and Consumer Protection Act of 2005

The United States Congress made comprehensive changes to bankruptcy law in the ________.

payor

The bank upon which a check is drawn is the ________ bank.

Larry has the largest pizza business in the city. He learns that Henry is thinking of opening a competing pizza and pasta delivery business. Larry gives Henry $25,000 to not open his proposed business in the same city. Which statement is correct? a. The contract is illegal and void. b. The contract is enforceable. c. The contract is void for lack of consideration. d. The contract is voidable at Larry's option.

The contract is illegal and void.

E-mation entered into a contract with a consumer, Ezra, a recent immigrant to the United States who spoke very little English and had no formal education. The contract provided for Ezra to pay $2,500 for a computer system. The system was worth $400. If E-mation sued Ezra for enforcement of the contract, what is the most likely result? a. The contract is enforceable because of the exculpatory clause. b. The contract is unenforceable because it is ancillary to a legitimate bargain. c. The contract is enforceable because of usury statutes. d. The contract is unenforceable because it is unconscionable.

The contract is unenforceable because it is unconscionable.

Mike owns a house in a low-income area of a large city. Mike is on disability, and his total monthly income is $700. A sales representative visits his home to sell him a water purification system. Mike signs a contract that calls for monthly payments of $500 for the next 10 years. The water system is worth no more than $1,000. Mike thought he was signing a permission slip allowing the salesman to conduct a free water test to determine the toxins in the water. How would a court most likely describe this contract? a. The contract is enforceable, but only up to the value of the water system. b. The contract is unenforceable because it is unconscionable. c. The contract is fully enforceable as written. d. The contract is unenforceable because it is exculpatory.

The contract is unenforceable because it is unconscionable.

The contract is voidable if Samuel was incompetent at the time the contract was formed. The contract is void if Samuel has been previously determined to be mentally incompetent

The contract is voidable if Samuel was incompetent at the time the contract was formed. The contract is void if Samuel has been previously determined to be mentally incompetent.

Samuel has mental competency issues. Samuel entered into a contract with Beth, but now Samuel is petitioning the court to terminate the contract. What options does the court have in ruling in the case? Choose 2 answer choices. The contract is voidable if Samuel was incompetent at the time the contract was formed. The contract is voidable if a court has previously determined Samuel to be mentally incompetent. The contract is void if Samuel was incompetent at the time the contract was formed. The contract is void if Samuel has been previously determined to be mentally incompetent.

The contract is voidable if Samuel was incompetent at the time the contract was formed. The contract is void if Samuel has been previously determined to be mentally incompetent.

What is the result if parties agree to a contract orally, but it is a contract that must be in writing under the statute of frauds? Choose 2 answer choices

The contract is voidable. The parties can complete the contract.

What is the result if parties agree to a contract orally, but it is a contract that must be in writing under the statute of frauds? Choose 2 answer choices.

The contract is voidable. The parties can complete the contract.

What is the result if parties agree to a contract orally, but it is a contract that must be in writing under the statute of frauds? Choose 2 answer choices. The contract is illegal. The contract is voidable. The parties can complete the contract. The contract is void.

The contract is voidable. The parties can complete the contract.

What is the test for whether a contract is governed by the Statute of Frauds because of the one-year rule?

The contract must be objectively impossible to perform within one year.

What is the test for whether a contract is governed by the Statute of Frauds because of the one-year rule? The contract start date must be more than one year from the date of signing. The contract must be unlikely to be performable in less than one year. The contract must be able to be performed in less than one year. The contract must be objectively impossible to perform within one year.

The contract must be objectively impossible to perform within one year.

Suppose that Lenny Lawyer enters into an agreement with Cindy Client that his fee will be a percentage of the recovery Lenny obtains for Cindy in her pending divorce. State law makes such a contingency fee arrangement illegal in divorce actions. What will be the probable outcome if Lenny attempts to enforce the agreement? The contract will be valid. Cindy would not have been able to afford an attorney otherwise and therefore Lenny was doing a public service. The contract will be voidable at Cindy's option. The contract will be void as violating a statute. Lenny will not be able to recover anything. The contract will be unenforceable if Lenny did not get the agreement in writing.

The contract will be void as violating a statute. Lenny will not be able to recover anything.

Suppose that Lenny Lawyer enters into an agreement with Cindy Client that his fee will be a percentage of the recovery Lenny obtains for Cindy in her pending divorce. State law makes such a contingency fee arrangement illegal in divorce actions. What will be the probable outcome if Lenny attempts to enforce the agreement? a. The contract will be valid. Cindy would not have been able to afford an attorney otherwise and therefore Lenny was doing a public service. b. The contract will be void as violating a statute. Lenny will not be able to recover anything. c. The contract will be unenforceable if Lenny did not get the agreement in writing. d. The contract will be voidable at Cindy's option.

The contract will be void as violating a statute. Lenny will not be able to recover anything.

Legality

The contract's purpose must be to accomplish some goal that is legal and not against public policy. the contract must be for a lawful purpose the quality or state of being in accordance with the law

Abby hires a contractor to make repairs on her house. Before the repairs are finished, Abby dies. Her good friend Clay is appointed executor of Abby's estate. Clay 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. If the contractor's bill does not get paid, who can the contractor collect from, if anyone? The contractor can collect from either the estate or Clay. The contractor can collect from the estate only. The contractor can collect from Clay only. The contractor must collect from the estate first, and then collect any deficiency from Clay.

The contractor can collect from the estate only.

Contract Definiteness

The main requirements for a valid contract are: 1. Offer - made by the offeror 2. Acceptance - made by the offeree 3. Consideration - what each party gives up under the contract An offer is a statement or act by the offeror to the offeree promising to perform or refrain from performing some act.

E-mation, Inc. hires Marvin to steal trade secrets from one of its competitors for $10,000. Marvin demands half of the money up front. E-mation pays Marvin $5,000, but Marvin decides not to pursue theft of the trade secrets. E-mation sues Marvin for the return of the $5,000. What will the court do with this contract? a. The court will order Marvin to return the $5,000. b. The court will order Marvin to return the $5,000 with interest. c. The court will order Marvin to obtain the trade secrets. d. The court will not do anything to help E-mation get its money back.

The court will not do anything to help E-mation get its money back.

What must a plaintiff show to be awarded a quasi-contract in a lawsuit?

The defendant expected to be paid. The plaintiff received some benefit. The defendant agreed to compensate the plaintiff for the benefit received. The defendant was unjustly enriched.

What factors make an agreement enforceable under the principle of quasi-contract? Choose 2 answers. The enriching party is negligent. The courts determine that an enforceable contract exists. The enriched party knows about the benefit and keeps it. One party is being enriched at the expense of the other.

The enriched party knows about the benefit and keeps it. One party is being enriched at the expense of the other.

In which school of jurisprudence is the concept of stare decisis rooted?

The historical school

What does it mean if an auction is with reserve? a. The items for sale have a minimum price. b. The auctioneer must sell to the highest bidder. c. Unless otherwise stated, the auctioneer has the right to withdraw the item before the fall of the hammer. d. Even after the fall of the hammer, the auctioneer can accept other bids.

The items for sale have a minimum price.

Goods

The merchant can transfer all rights in the goods to a buyer in the ordinary course of business.

In contract cases, courts generally adhere to which of the following theories when deciding the issue of the offeror's intent?

The objective theory of contracts. U.S. courts hold that an offeror's words and conduct mean whatever a reasonable person in offeree's position would think they mean.

Terms the parties outline in agreements, custom, and rules outlined by the Uniform Commercial Code

The obligations of sellers and buyers are determined by which of the following?

If the subject matter of an offer becomes illegal, what is the result?

The offer immediately terminates

Dick offers to sell Jane his 1955 Thunderbird convertible. Before Jane can accept the offer, lightning strikes the car and it is totally destroyed. Which of the following is true? a. Jane can still accept the offer. She will be entitled to the insurance proceeds. b. Jane can still accept the offer and John must find a 1955 Thunderbird to sell. c. Dick can still revoke his offer so long as he does so before Jane accepts. d. The offer is terminated by law.

The offer is terminated by law.

Floyd offers to sell his 1967 Ford Mustang convertible to Tim. Before they conclude their negotiations, Floyd dies. Which of the following is true? a. Floyd's heirs must continue to negotiate the offer and sell the car, if a reasonable price can be determined. b. The offer terminates automatically upon Floyd's death. c. There is a contract if Tim accepts before learning of Floyd's death. d. Floyd's heirs must sell the car to Tim

The offer terminates automatically upon Floyd's death.

How may an offer be terminated? Choose 3 answers. The offeree may make a counteroffer. A competitor to the offeror can issue a better offer for the same product or service. An offeror may terminate an offer by revocation. A reasonable amount of time has passed.

The offeree may make a counteroffer. An offeror may terminate an offer by revocation. A reasonable amount of time has passed.

How may a revocable offer effectively be revoked? Choose 2 answers. The offeror may convert the offer to an option contract. The offeree may reject the offer with a clear expression. The offeror may withdraw the offer with a clear expression. The offeror may take an action that contradicts the offer and make that known to the offeree.

The offeror may withdraw the offer with a clear expression. The offeror may take an action that contradicts the offer and make that known to the offeree.

What elements are required for an offer to be effective under the common law? Choose 3 answers. The offeror must intend to be bound by the offer. The terms of the offer must be reasonably definite so that all parties understand them. The offer must be communicated to the offeree. The offer must be irrevocable for a set period of time to allow acceptance.

The offeror must intend to be bound by the offer. The terms of the offer must be reasonably definite so that all parties understand them. The offer must be communicated to the offeree.

Which of the following is an accurate description of the parol evidence rule?

The parol evidence rule states that oral evidence of an agreement made prior to or contemporaneously with a written agreement is inadmissible when the parties intend the written agreement to be the complete and final version of their agreement.

drawee

The party ordered to pay on a draft is the ________.

payee

The party receiving the money from the draft is the ________.

eliminate situations in which women, working alongside men or replacing men, are paid lower wages for doing substantially the same job.

The primary purpose of the Equal Pay Act is to ________.

What elements are required for courts to apply the doctrine of promissory estoppel? Choose 3 answers. The promise must be definite and relied upon. There was a detrimental result from reliance on the promise. Enforcement of the promise is necessary to avoid injustice to the promisee. There must have been consideration given with the promise.

The promise must be definite and relied upon. There was a detrimental result from reliance on the promise. Enforcement of the promise is necessary to avoid injustice to the promisee.

relative permanence

The quality of a negotiable instrument that ensures its longevity is known as ________.

Workers' compensation, workplace safety, and unemployment statutes

The question of whether a worker is an employee or an independent contractor has important implications in which of the following areas?

35.Intellectual

The songwriter has a copyright on her latest hit. The song is known as what type of property?

Which of the following is an absolute defense to defamation?

The statement is true.

commercial reasonableness

The term "reasonable commercial standards of fair dealing" is often called ________.

In order for an offer to be effective, which of the following IS necessary?

The terms of the offer must be reasonably certain and definite. There must be a serious, objective intent by the offeror. The offer must be communicated to the offeree.

Implied warranty of merchantability, implied warranty of fitness for a particular purpose, and implied warranty of trade usage.

The three warranties of quality that arise under the Uniform Commercial Code are the:

Estoppel

The word "estoppel" is based on the old English word "estoppen" which means a person is barred from denying the truth of the matter. We use an abbreviated form "stop" at intersections

Colleen, an emergency medical technician, is called to an accident scene by Dennis and renders medical care to Theresa, a minor. Colleen may recover the reasonable value of the rendered care from

Theresa

Oxtron, Inc. sent the following price list to its customers. Dispensers: SBC-500J$670.00 True TDD-1$875.00 True TDD-2$1,465.00 True TDD-3$1,515.00 CO2 Tank and Regulator $150.00 Which statement is correct? a. These price quotes would generally be considered requirements contracts. b. These price quotes would generally be considered offers. c. These price quotes would generally not be considered offers. d. These price quotes would generally be considered output contracts.

These price quotes would generally not be considered offers.

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. a. This contract was a valid contract, Robert cannot disaffirm. b. This contract was a voidable contract, Robert can disaffirm. c. This contract was unenforceable because it needed to be in writing to be enforceable. d. This contract was a void contract.

This contract was a voidable contract, Robert can disaffirm.

Mental Incompetence

This type of capacity limitation is a result of being unable to understand the nature and consequences of entering into the contract. In the case of mental capacity issues, the contract could be declared void, voidable, or valid, depending on the circumstances. Void - If a court had previously determined the party to be mentally incompetent, the contract is void. Once a party is declared to be mentally incompetent, all future contracts are void. Voidable - If the party has not been determined incompetent, but the party was incompetent at the time the contract was formed, the contract is voidable if the party could not understand he or she was entering a contract, or lacked the capacity to understand the terms of the contract. That party can continue with the contract or choose to terminate it. Valid - If the party has not been judged to be mentally incompetent in the past and is able to understand the terms of the contract, the contract is valid.

37.Patent

Thomas Edison invented the light bulb. What document protected this invention?

Disparate treatment and disparate impact, but not disparate equity

Through which of the following theories can an employee-plaintiff prove discrimination under Title VII of the Civil Rights Act of 1964?

When would a plaintiff use the doctrine of res ipsa loquitur?

To allow the judge and jury to infer that more likely than not, the defendant's negligence was the cause of the plaintiff's harm, even though there is no direct evidence of the defendant's lack of due care

What is the stated purpose of the statute of frauds?

To prevent unreliable oral evidence from interfering with a contractual relationship

What is a purpose of the parol evidence rule?

To restrict evidence from being admitted that substantially contradicts an agreement in its written form

Disaffirmance by a minor

To terminate the contract, the minor must show his or her intention not to be bound through the act of disaffirmance. To disaffirm, the minor must express his or her intent by words or actions. The minor must disaffirm the entire contract, and do it during minority age or within a reasonable period of time after reaching majority age. Contracts for necessities is one exception to the rule that contracts with minors are voidable. Minors must pay for necessities, such as housing, food, and medical care. Society wants parties to be willing to provide necessities to minors without concerns regarding whether or not they will be paid.

16.Agency by estoppel

Troy is identified as Mary's agent by circumstance and created by law. Which term is used to describe Troy in this situation?

Joli receives a letter from Kerin saying that he has a book at a certain price. Jolie signs and returns the letter to Kerin. When Kerin delivers the book, Joli sends it back, claiming that they do not have a contract. Kevin claims they do. What standard determines whether these parties have a contract?

Under the objective theory of contracts, if a reasonable person would have thought that Joli had accepted Kern's offer when she signed and returned the letter, then a contract was made, and Joli is obligated to buy the book. This depends, in part, on what was said in the letter and what was said in response. For instance, did the letter contain a valid acceptance? Under any circumstances, the issue is not whether either party subjectively believed that they did, or did not, have a contract.

What type of acceptance requires an affirmative action for the offeree to accept that offer? Unilateral contracts Browsewrap Agreements Offeree's silence in response to an offer The typical type of acceptance to an offer

Unilateral contracts

Which of the following occurs when a party makes a loan at an interest rate exceeding the legal maximum?

Usury

Giving possession and control of personal property to another person is referred to as a. adhesion. b. unconscionability. c. usury. d. bailment.

Vanessa

asher buys a linen suit from Miriam and gives it to his father, Moises. Moises takes the suit to Vanessa, who runs a local dry cleaner, to have the suit cleaned and pressed. Who is the bailee? a. Moises b. Miriam c. Vanessa d. Asher

Vanessa

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? a. Wally wins; the original offer was not intended to be an offer but merely an invitation to negotiate. b. Robert wins; the UCC will decide which 40 acres are to be sold. c. Wally wins; this agreement is too indefinite since it does not identify which 40 acres are to be sold. d. Robert wins; this is an enforceable contract with complete and definite terms.

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

5.Fair Labor Standards Act

Wanda's employer wants to pay her less than the minimum wage. Which law would Wanda use to protect her current wages from being changed to below minimum wage?

The court can either refuse to enforce the contract or lease, or it can enforce the parts of that are fair.

What actions does the Uniform Commercial Code allow a court to take if it discovers that a contract or lease provision is unconscionable?

Chapter 15

Which of the following chapters of the Bankruptcy Code recognizes insolvency proceedings pending in a foreign country and relief for foreign debtors?

purchase-money security

When a debtor uses borrowed money from the secured party to buy the collateral, a(n) ________ interest is formed.

fraud in the factum

When a party signs a negotiable instrument without knowing that it is, in fact, a negotiable instrument, the party can claim ________.

As soon as a transferee discovers a breach of warranty has occurred, he or she can bring suit against the transferor.

When can a transferee bring suit against a transferor for a breach of warranty regarding a negotiable instrument?

When the goods are identified to the contract

When does title transfer to the buyer in a simple delivery contract?

When the employee is fired for gross misconduct or the employer decides to eliminate benefits for all current employees, but not when the employee quits without notice

When is an employer not required to offer an employee the option to continue medical benefits under the Consolidated Omnibus Reconciliation Act (COBRA)?

on-us

When the depositary bank is the same bank as the payor bank, the check is referred to as a(n) ________ item.

honesty in fact and reasonable commercial standards of fair dealing

When the parties are merchants, the Uniform Commercial Code requires ________.

31.National Environmental Policy Act

Which act established a national policy and goals for the protection, maintenance, and enrichment of the environment?

25.Pollution Prevention Act

Which act establishes activities for recycling, source reduction, and sustainable agriculture, and helps to promote the conservation of energy, water, and natural resources?

30.Energy Independence and Security Act

Which act increases clean renewable fuel production, research on greenhouse gas, and improves the government's energy performance?

28.Clean Water Act

Which act protects fish, shellfish, and wildlife in rivers, lakes, streams, and oceans?

29.Clean Air Act

Which act was created by the U.S. Environmental Protection Agency to authorize the National Ambient Air Quality Standards (NAAQS) to assist in the creation of laws to protect the environment?

27.Federal Energy Regulatory Commission

Which agency controls the price of natural gas and electricity for interstate business transactions?

32.Nuclear Regulatory Commission

Which agency generates safety policies and regulations for nuclear reactors?

26.Environmental Protection Agency

Which agency manages all federal antipollution programs and handles air, solid waste, toxic substances, and pesticides?

24.Department of Energy

Which agency promotes supply and delivery of reliable, affordable, and environmentally sound energy?

18.Reasonable care

Which duty expects employers to properly maintain a healthy work environment?

A buyer may waive both implied and express warranties.

Which is true regarding a buyer's right to waive warranties?

Documents of title

Which of the following are a type of indispensable paper?

Consequential

Which of the following are damages for lost profits a buyer may recover in the event of a breach of contract?

Blank and special

Which of the following are types of unqualified endorsements?

Disparate-impact

________ cases are also known as unintentional discrimination cases.

The "Who" in the WH process of ethical decision making means what?

Who are the stakeholders affected by the decisions a firm makes?

Any authorized representative

Who may endorse an instrument made payable to a legal entity such as a partnership?

simple delivery

With a ________ contract, the buyer and seller typically execute an agreement, and the buyer leaves with the goods.

The seller

With a simple delivery contract in which the seller is a merchant, which party sustains the loss if, through no fault of either party, the goods are destroyed through fire prior to delivery to the buyer?

The buyer, if tender of delivery has occurred

With a simple delivery contract in which the seller is not a merchant, which party sustains the loss if, through no fault of either party, the goods are destroyed through fire prior to delivery to the buyer?

When the goods are delivered to the buyer

With a simple delivery contract involving goods sold by a merchant that are to be delivered to the buyer, when does risk of loss transfer to the buyer?

Honesty in fact

With respect to non-merchants, how does the Uniform Commercial Code define good faith?

In January, Alex promised to pay Y-K Inc. $5,000 if it would refrain from filing suit against him on a breach of contract action. Y-K agreed and accepted a $5,000 check from Alex. Which of the following statements is correct?

Y-K's promise to refrain from suing Alex was supported by legal consideration and is enforceable.

Yes, Geoffrey can enforce the deal because the contract contained valid consideration.

The Consolidated Omnibus Budget Reconciliation Act

________ enables employees who lose their jobs or have their hours reduced to a level at which they are no longer eligible to receive medical, dental or optical benefits have the right to pay to continue receiving benefits for themselves and their dependents under the employer's policy.

Rafael tells his friends that he wants to sell his party barge for $30,000. Rafael has some flyers made up with a picture of the party barge, a description of the features, and the price. Andre obtains one of the flyers and contacts Rafael about purchasing the party barge. Rafael draws up a contract and mistakenly lists the price of the party barge at $20,000 instead of $30,000. Rafael and Andre both sign the contract. When Andre brings $20,000 to purchase the party barge, Rafael discovers his mistake. Will Rafael be able to rescind the contract?

Yes, Rafael can rescind the contract even though it was a unilateral mistake.

Sarah is shopping at Sylvia's thrift store, and notices that the inside of the store needs repainting. Sarah offers to paint the store for $400. Sylvia does not respond to Sarah's offer. Later that day, Sarah returns to the store with painting supplies in hand and begins painting the store. When Sarah is finished, she demands payment of $400 from Sylvia. Will Sylvia have to pay Sarah for painting the store?

Yes, Sylvia will have to pay Sarah for painting the store, even though she did not verbally agree to the contract.

If a buyer agrees to purchase "all the widgets I require" and the seller agrees to sell him "all the widgets you require" is there sufficient consideration?

Yes, because this is a requirements contract.

If unforeseen difficulties arise during the performance of a contract, may the parties change the terms of the contract without giving additional consideration?

Yes, if the modification is fair and equitable.

May a writing consistent of multiple separate documents?

Yes, if they are attached together in some manner.

Manuel contracts to sell a painting that was painted by his deceased grandmother, then has a change of heart and decides to hang it in his own bedroom. He notifies Nadine, the person who had planned to buy it. Can Nadine have the contract enforced?

Yes, it can be enforced under the equitable remedy of specific performance.

Are gambling contracts illegal?

Yes, unless they are specifically authorized by state statute.

The Pregnancy Discrimination Act of 1987

________ expands the definition of sex discrimination based on gender.

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, a. Zero will win because Millie had a preexisting duty to pay any additional amounts. b. Zero will lose because there was no legal consideration to support the additional $1,500. c. Zero will win because there was consideration for the additional $1,500. d. Zero will lose because the UCC does not require consideration to modify an existing contract.

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

An agreement in which parties intend to form a valid bargain, but a court declares that some rule of law prevents enforcing it is called a. an unenforceable agreement. b. a quasi-contract. c. a voidable contract. d. a void agreement.

An express contract a. has both parties setting forth their intentions. b. is not valid in many states. c. must be in writing. d. may be inferred by the conduct of the parties involved

Cal offers to shovel the snow from Burt's driveway for $35. Burt replies "OK." This is an example of: a. an express, bilateral contract. b. an implied, bilateral contract. c. an implied, unilateral contract. d. an express, unilateral contract.

One of the factors leading courts away from a laissez-faire approach to contract law was a. a change in relative bargaining power between parties to contracts. b. the assumption that promises are not legally significant. c. the assumption that parties had freedom to contract and would have to live with the consequences. d. the movement away from requiring written contracts with a seal affixed.

Sharon offers to sell Janice goods both parties know are stolen. Janice accepts the offer, and agrees to pay for the goods. Later, Janice refuses to accept or pay for the goods. If Sharon sues Janice for breach of contract, what is the probable result? a. The law would not enforce Janice's promise, as it does not have a lawful purpose. b. Sharon would win as this is a unilateral contract. c. Sharon would win as this is a valid, enforceable contract. d. Janice would win as this is a voidable contract.

Goods" means anything movable, except for money, securities, and certain legal rights

a. Goods include pencils, commercial aircraft, books, and Christmas trees. b. Goods do not include land or a house because neither is movable, nor do they include a stock certificate.

three basic questions of common sense, all relating to promises:

a. Is it certain that the defendant promised to do something? b. If there was in fact a promise, is it fair to make the defendant honor it? c. If the defendant did not promise, are there unusual reasons to hold the defendant liable anyway?

The damages awarded are called quantum meruit, meaning that the plaintiff gets "as much as was deserved."

a. The court is awarding money that it believes the plaintiff morally ought to have, even though there was no valid contract. This is judicial activism. The purpose is justice; the name is contradictory

The mailbox rule says that:

an acceptance is effective upon dispatch by an authorized means of acceptance.

Even when there is no contract, a court may use a quasi-contract to compensate a plaintiff who can show that:

a. The plaintiff gave some benefit to the defendant, b. The plaintiff reasonably expected to be paid for the benefit and the defendant knew this, and c. The defendant would be unjustly enriched if they did not pay.

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 a. a rescission. b. a preexisting duty. c. a contract modification. d. an accord and satisfaction.d

an accord and satisfaction.

a. a voidable contract, one that Jack can void. b. a void contract because of the UCC. c. a voidable contract, because it is unilateral. d. a void agreement because of the fraud involved.

General Construction, LLC, is a limited liability company. Among the members, a dispute arises that their operating agreement does not cover.The dispute is governed by

a. the applicable state LLC statute

In general, which of these contract terms is NOT required to meet the requirement of definiteness? The parties involved The subject matter of the contract The time of payment Acceptance

acceptance

A new agreement to pay less than the creditor claims is owed is called a(n) _____.

accord

Courts seldom consider _____, meaning that courts usually do no determine whether a contracting party made a good bargain

adequacy of consideration

Suppose Anna's father had a Volkswagen Beetle when she was a little girl. Anna happens to see a Beetle that is the same style and color in a parking lot and waits for the owner, Julie, to return to ask Julie if she will sell the car. Julie is not interested in selling the car, but Anna offers double the market price and Julie agrees to the deal. Later, Anna decides she is getting a bad deal and wants to walk away from the contract. Julie sues Anna. The court can rule that the consideration was adequate because of the sentimental aspect. The parties decided what that car was worth and are now bound by their contract Describes what consideration?

adequacy of consideration

Deluxe Awnings, Inc., offers Elbert a job as an installer. No time for acceptance is specified in the offer. The offer will terminate

after a reasonable period of time

If a contract is _____, it is unenforceable.

against public policy

Laticia offers to sell her law books to Darren for $500. Darren agrees. This is known as a(n) _____.

agreement

The basic distinction between an executory contract and an executed contract is that

all parties have fulfilled their obligations in an executed contract.

The basic distinction between an executory contract and an executed contract is that a. only one promise is involved in an executory contract. b. one is legal, the other is not. c. one is enforceable, the other is not. d. all parties have fulfilled their obligations in an executed contract.

all parties have fulfilled their obligations in an executed contract.

An agreement to settle a debt for less than the sum claimed is referred to as

an accord.

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, a. 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. b. courts will generally not enforce a cancellation and modification of a contract unless one party received inadequate consideration under the original contract. c. the surest way to modify the contract is to liquidate it. d. they may not do so without court supervision.

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 of a contract is considered:

an equitable remedy.

Maryanne offers to sell her 2015 Mustang convertible to April for $15,000, and April agrees to those terms. April brings the $15,000 to Maryanne, and Maryanne promises to deliver the Mustang to April the next day after she has it detailed. At this point, Maryanne and April have:

an executory contract.

Marlie's contract explicitly states that she must perform her contract obligation by June 1 at 5:00 p.m. This is an example of _____.

an express condition

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

an express, bilateral contract.

Seven companies agree that they will not compete against each other, will set prices, and not hire each other's employees. Such a contract will be

an illegal contract in restraint of trade.

A usurious contract involves

an illegally high rate of interest

Marco agrees to sell Clowns R Us some balloons. The contract states that Clowns may buy as many balloons as it wishes. This agreement is a. an enforceable contract. b. an illusory contract. c. an output contract. d. a requirements contract.

an illusory contract.

Flavors of the Southwest, Inc., contracts to deliver a certain quantity of food and beverages every weekday to Geo Construction's work site, which Geo will pay for if the food tastes "awesome". This is

an illusory promise

Vita asks Walter, a man who makes and sells shoes, to repair a pair of work boots. There is no discussion of a price, and Vita and Walter do not sign any documents. After the repair, Walter hands Vita a bill. With respect to Vita's obligation to pay the bill, this is

an implied contract

Napoleon owns Napoleon's Construction and agrees to renovate Mrs. Cernan's bathroom. She will provide him with the plans and then he will do the work in the manner he determines is most cost effective and appropriate. Napoleon is likely to be classified as:

an independent contractor.

Mobile Media Company contracts to hire Nada for one year at $35 per hour, reserving the right to cancel the contract at any time. Nada begins working for Mobile Media. This promise is

an option-to-cancel clause

Which of the following is an equitable remedy for breach of contract?

an order for specific performance

A(n) _____ of contract often arises when market conditions change and one party realizes that it will not be profitable to carry out the terms of the contract.

anticipatory repudiation

An e-contract can be defined as:

any contract formed electronically, such as over the Internet. An e-contract is one that is formed electronically. Typically, the term is used to refer to contracts formed via the Internet.

Jones Construction Company is building a series of new subdivisions in Newtown over the next two years. Jones enters into a verbal agreement with Harley Concrete Inc. to construct all the driveways and sidewalks in the subdivisions that Jones will be building. Jones and Harley agree on a price of $130 per cubic yard and that Jones will pay Harley at the end of each project. Harley completes the first project, which is four sidewalks and sixteen driveways, and bills Jones for the project. Jones decides that the price is too high and refuses to pay, claiming that they have no obligation to pay because the parties did not have a valid contract. If Harley sues Jones for payment the court would probably:

apply quasi contract theory and award the fair market value of the work that Harley completed.

In bailment cases, exculpatory clauses a. ordinarily involve an attempt to limit liability for damage to persons rather than property. b. are very rarely used. c. are not enforced because any harm is to property and not persons. d. are somewhat more likely to be enforced than in other types of cases.

are somewhat more likely to be enforced than in other types of cases.

If a grand jury issues an indictment against a defendant, the defendant then appears in court to answer the indictment in a proceeding called the _____.

arraignment

Owen offers to sell his motorcycle to Julian for $5,000. After he makes the offer, Owen has second thoughts. Owen can revoke the offer to sell his motorcycle to Julian:

as long as Julian has not yet accepted the offer.

Barbara transfers her rights to receive her tenant's rents to Penelope. This is an example of a(n) _____.

assignment

According to the _____ defense, a defendant may avoid liability by establishing that the plaintiff voluntarily and unreasonably encountered the risk of the actual harm that the defendant caused.

assumption of the risk

Doug 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 Doug is injured because of a defect in the mower and sues the lawnmower manufacturer, he will most likely: a. win, as all lawnmower manufacturers are strictly liable. b. win, as this warning would be unenforceable. c. lose, as he agreed to not hold the lawnmower manufacturer liable. d. lose, as he assumed the risk.

Madison purchases several 50-pound bags of mulch at the local gardening store. An employee carries the bags of mulch to Madison's truck and loads them into the back for her. Will Article 2 of the UCC govern the contract in this situation? a. No, this is a mixed contract because Madison is paying for both goods and labor. b. Yes, because the primary purpose of this contract is the sale of goods. c. Yes, because Article 2 of the UCC governs all bilateral contracts. d. No, this is an express contract because both parties explicitly state their intentions.

Noncompetition agreements are a. relatively recent developments, first used following the Great Depression in the United States. b. more common today than they were in the past, although policy issues they raised in the 1700s have never gone away. c. infrequently litigated. d. now illegal, as they violate antitrust laws

When an agreement fails to qualify as an enforceable contract, but one of the parties breaches the agreement, the non-breaching party:

may sue for unjust enrichment

Onida is an employee at Kale's Manufacturing Company. The company makes bicycle tires, and Onida's job is to inspect the inner tubes before they are inserted into the tires. She recently noticed that the inner tubes are thinner than the safety specifications require. Onida tells her supervisor, Tom, about the problem, and is instructed to ignore it because these thinner tubes save the company money. Onida cannot ignore this problem in good conscience, so she tells Tom that if he is not going to report the problem, she will. Tom then fires Onida. Kale's Manufacturing Company is in an employment-at-will state. If Onida brings a lawsuit for wrongful termination, she will likely:

be successful because she was fired for an unlawful reason.

Gerald has been a sales representative for Goldsmith's Department Store for the past five years. When Gerald was hired, the general manager told Gerald that he would have a job there as long as he made $3,000 in sales each month. Every month, Gerald has exceeded that level in sales, so he is surprised when his supervisor calls him into the office and fires him. Gerald tells the supervisor about the promise from the general manager not to fire him as long as his sales were $3,000 each month. The supervisor responds by telling Gerald that the law in this state is employment at will, so he can fire him at any time for any reason. If Gerald sues Goldsmith's for wrongful termination, he will likely:

be successful because the general manager orally promised him that he would remain in his job as long as his sales stayed at a specific level, and he has maintained that level.

Barb promises to pay Tina for her new car on Friday. Tina agrees to sell her car to Barb. This is a(n) _____.

bilateral contract

Bruce, a minor, enters into a contract with Coralee to buy her car. Later, Bruce opts to avoid the deal. With respect to the contract, this releases

both parties

The violation of a duty of care is called _____.

breach of duty

exists when a party posts terms on a website or includes a hyperlink in other information without requiring users to click on a button or complete any other action describes what?

browsewrap terms

Alvin offers to buy a car from Jill for $400. Jill must accept this offer in order to form: a. an unenforceable contract. b. a voidable contract. c. a bilateral contract. d. an executed contract.

Kieran 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 snowstorm to hit the area. This is an example of a: a. bilateral, express contract. b. unilateral, express contract. c. unilateral, implied contract. d. bilateral, implied contract.

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 a. win, as all lawnmower manufacturers are strictly liable. b. lose, as he agreed to not hold the lawnmower manufacturer liable. c. win, as this warning would be unenforceable. d. lose, as he assumed the risk.

Neon enters into a contract with Stogey Company to purchase a washer and dryer. She doesn't understand the financing terms, which include a high interest rate and steep late-payment penalties, but signs the agreement anyway because she needs the appliances. The financing terms are very unfavorable to Neon, and she is unable to make all of her payments when they are due. Stogey sues. This is an example of: a. a void agreement because neither Neon nor Stogey had the legal authority to make the contract. b. a voidable contract because Stogey Company has committed fraud. c. a valid contract, even though the terms are unfavorable to Neon. d. an unenforceable agreement that violates some rule of law.

Noncompetition agreements are: a. less common than they used to be. b. infrequently litigated. c. more common today than they were in the past, although policy issues they raised in the 1700s have never gone away. d. now illegal, as they violate several laws.

On January 16, Ashley offers to sell her waterbed to Madison for $600. Madison accepts and agrees to pay Ashley $600 on January 27. Which of the following is correct? a. There is no contract until one party performs. b. This contract is a unilateral contract. c. On January 16, the contract was executory. d. On January 16, the contract was executed.

Taylor promises to pay $100 to anyone who finds his lost watch. Kelly finds and returns the watch to Taylor after hearing of the reward money. What kind of contract do Taylor and Kelly have? a. An unenforceable unilateral contract. b. An unenforceable bilateral contract. c. An enforceable unilateral contract. d. An enforceable bilateral contract.

Marco hires Franco to burn down a clothing store that belongs to one of Marco's competitors. Marco pays Franco $1,000 upfront and promises another $3,000 when the job is done. Franco burns down the clothing store and then asks Marco for the rest of the payment. Marco just laughs at Franco and walks away. If Franco sues Marco for payment under the contract: a Marco will not have to pay because of the lack of competent parties. b Marco will have to pay because all the elements of a contract have been met. c Marco will not have to pay because the subject matter of the contract is illegal. d Marco will not have to pay because the agreement lacks consideration.

c Marco will not have to pay because the subject matter of the contract is illegal.

Selma wants to buy Matilda's house. Selma has been admiring the house for a long time and has asked Matilda repeatedly to sell the house to her, but Matilda has always refused. Finally, Selma tells Matilda that if Matilda does not sell Selma the house, Selma will kill Matilda's daughter. Afraid for her daughter's life, Matilda signs the contract to sell the house to Selma. If Matilda later tries to rescind the contract: a Matilda may rescind the contract on the grounds of unconscionability. b Matilda may not rescind the contract because it has all the elements of a valid contract. c Matilda may rescind the contract on the grounds that she signed the contract under duress. d Matilda may rescind the contract on the grounds of undue influence.

c Matilda may rescind the contract on the grounds that she signed the contract under duress.

Harold offers to sell Emma his farmland in Bryson County. After discussing the sale at length in front of their friends Nicole and Jackson, Harold and Emma orally agree on a price of $120,000 for the land. The next day, Emma goes to the bank and withdraws $120,000 to pay Harold for the land. When Emma presents the $120,000 to Harold, Harold tells Emma he was just joking and does not wish to sell the land. Emma tries to enforce the deal, and Harold continues to refuse by saying that the deal was not in writing, and, therefore, it is unenforceable. The contract between Harold and Emma for the sale of the land:

c is not enforceable because it violates the statute of frauds.

Morgan, a minor, signs a contract to buy a Call4U phone and a monthly calling plan from Sterling, an independent sales representative. Morgan can avoid the contract. Sterling

cannot avoid the contract

A person who has legal _____ to contract is one who has the mental ability to understand his or her rights and obligations under a contract.

capacity

the legal ability of the principal to make contracts based on age and mental state

capacity

Quasi Contract

cases, the defendant did not make any promise, but did receive a benefit from the plaintiff and retaining that benefit would be unfair An obligation or contract imposed by law (a court), in the absence of an agreement, to prevent the unjust enrichment of one party. A fictional contract imposed on the parties by a court in the interests of fairness and justice; usually imposed to avoid the unjust enrichment of one party at the expense of another.

Promissory Estoppel

cases, the defendant made a promise that the plaintiff relied on A doctrine that applies when a promisor makes a clear and definite promise on which the promisee justifiably relies; such a promise is binding if justice will be better served by the enforcement of the promise. the legal enforcement of an otherwise unenforceable contract due to a party's detrimental reliance on the contract an equitable doctrine that prevents the promisor from revoking the promise when the promisee justifiably acts in reliance upon the promise to his detriment

Clicking on an "I agree" button is the method of acceptance for a __________ agreement

clickwrap

Johan borrows money from Beth, but the agreement is not in writing. Johan needs a little more time to pay, and Beth will only allow that if he has someone guarantee to pay if he does not. Although it is not your obligation, you agree to pay the debt if Johan does not. Your agreement with Beth must be in writing. Describes what?

collateral promise

When one person agrees to pay the debt of another as a favor to that debtor, it is called a

collateral promise

means that some unexpected event has made it extraordinarily difficult and unfair for one party to perform its obligations:

commercial impracticalibity

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

committed usury

When judges make legal interpretations, this is often referred to as case law or ___________.

common law

Usury laws are designed to protect consumers from a. professionals practicing a trade without a valid license. b. companies charging excess interest on loans. c. obtaining loans to gamble on credit. d. taking insurance policies out on the life of another.

companies charging excess interest on loans.

a condition in a contract that must be met before a party's promise becomes absolute

condition precedent

The courts will find an implied contract when

conduct of the parties indicates they intended an agreement

The courts will find an implied contract when

conduct of the parties indicates they intended an agreement.

The courts will find an implied contract when:

conduct of the parties indicates they intended an agreement.

What element of a contract refers to both parties receiving some measurable benefit? consideration capacity consent legality

consideration

Uniform Commercial Code (UCC)

contracts for the sale of goods for $500 or more must be in writing. The writing must include the quantity, but not all of the other terms of the deal are required to be included. The UCC allows for some exceptions to this rule.

The legal ability to enter into a binding agreement is known as _____.

contractual capacity

What is the term for the legal ability to enter into a binding contract?

contractual capacity

As English judges were developing the common law of contracts in the twelfth and thirteenth centuries: a. changes in the law occurred rapidly. b. the term "contract" became common. c. most promises were found to be binding. d. promises were found not binding unless written and sealed.

If a parent pays his adult child to quit smoking, that is forbearance and is consideration. The adult child has a right to smoke, and giving up that right is valid consideration for the contract. Describes what?

forbearance

Contracts that do not arise from mutual agreement but are created by courts to avoid unjust enrichment are: a. unilateral contracts. b. implied contracts. c. express contracts. d. quasi-contracts.

Danny, who is a 16-year-old minor, signs an agreement to buy a stereo from Lane for $200. Later Danny changes his mind and tells Lane he doesn't want to buy the stereo. The contract is not enforceable because of an issue with which element of a contract? a. Consent b. Consideration c. Offer d. Capacity

Gillian has offered to sell her computer for $1750 to Andy. She tells Andy that the computer is only six months old but, in fact, the computer is three years old, and Gillian wants to unload the lemon. Andy agrees to buy the computer based on Gillian's representations. This contract is: a. a void contract because of the UCC. b. a voidable contract, one that Gillian can void. c. a void agreement because of the fraud involved. d. a voidable contract, one that Andy can void.

A(n) _____ is an erroneous belief about the facts of a contract at the time the contract is concluded.

mistake

Jerry offers to shovel the snow from Ben's driveway for $35. Ben replies "OK." This is an example of a. an implied, unilateral contract. b. an implied, bilateral contract. c. an express, unilateral contract. d. an express, bilateral contract.

Jimmy enters into a contract to paint Chester's house. When Chester decides on a color, Jimmy will buy the paint and paint the house for the price of $2,500. This contract is governed by: a. both the common law and the Uniform Commercial Code will govern this contract. b. the Uniform Commercial Code governs because a sale of goods is involved. c. the common law of contracts governs because this is a mixed contract (one for services and goods). d. the common law of contracts governs because the predominant factor of the contract is for the sale of services and not goods.

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 a. executory, bilateral, implied-in-law contract. b. executed, unilateral, express contract. c. executed, bilateral, express contract. d. executory, bilateral, express contract.

The basic distinction between a bilateral contract and a unilateral contract is that: a. more than one promise is involved in a unilateral contract, but only one is examined. b. the Statute of Frauds applies to one and not the other. c. only one promise is involved in a bilateral contract. d. only one promise is involved in a unilateral contract.

Phoebe enters into a contract with Everest for a guided tour of Whitewater Canyon. Everest acts as though he is an experienced, knowledgeable guide, when in reality he has never been in the canyon. Phoebe is most likely a victim of

fraud

The obligation to use reasonable efforts to minimize damage resulting from a breach is referred as the duty to _____ one's damages.

mitigate

Roscoe enters into an illegal bargain with Gilda. Roscoe can enforce the contract or recover for its value if he has been induced to enter into the bargain as a result of

fraud

Which of the following is outlawed by consumer protection statutes? a. clickwrap agreements b. termination by expiration c. browsewrap agreements d. false advertising

false advertising

According to the United States Constitution, the authority to govern is divided between federal and state governments. This is known as _____.

federalism

Quon decides to sell his antique roadster, so he places an ad on Craigslist. He lists the roadster as a 1957 Mercedes Benz 300SL Roadster, describes it as in good working condition, and states that no reasonable price will be refused. Fern responds to the ad and offers to pay $25,000 to Quon for the car, which Quon agrees to. In this scenario, who is the offeror?

fern is the offeror

Judith is a CPA with an excellent reputation and client base. She sells her tax preparation business to Shawn, and the sales contract includes a non-compete clause restricting Judith from opening a similar business for one year within a 10-mile radius of her former office. If she opens a tax preparation office five miles away after one year, a court would probably a. grant an injunction barring her from operating the new office. b. order confiscation of all of her new client files and turn them over to Shawn. c. refuse to enforce the non-compete clause, as it is unreasonable regarding time and geographic area. d. refuse to become involved, as the non-compete clause was illegal.

grant an injunction barring her from operating the new office.

An express contract

has both parties setting forth their intentions

Selma, an elderly widow, gives her young neighbor, Steven, written power of attorney. This means that Steven now

has express authority to act as Selma's agent.

has not materially breached the contract and will be allowed the opportunity to cure by providing the one remaining computer.

Zayn boards the Big Rock Metro to ride downtown to his job. Zayn gives his money to the driver and takes his seat. Neither the driver nor Zayn says anything. Zayn and the bus driver:

have an implied contract

Bridey defends against a suit for breach of contract by Continental Mortgage Company by claiming that their deal—a mortgage loan secured by Bridey's purchase of a house—was unfair because the consideration for their contract was inadequate. Refer to Fact Pattern 13-A1. "Adequacy" of consideration refers to

how much consideration is given

Courts can give final judgments that solve existing problems; they cannot provide rulings about _____.

hypothetical situations

An exculpatory clause is generally unenforceable when a. it is written clearly and in bold, large print. b. it attempts to release a party from liability for ordinarily negligent behavior. c. the affected activity is a recreational activity. d. it involves public transportation.

it involves public transportation.

Lewis, an employee of Silos, Inc., makes a substantial mathematical error in totaling the estimated costs for a project for which AgriCo-op is seeking bids. Consequently, Silos's bid is significantly low. Refer to Fact Pattern 15-A1. Any contract with AgriCo-op that includes the mistake may be rescinded

if AgriCo-op know or should have known of the mistake

Performance and Discharge

if a party fully accomplishes what the contract requires, his duties are discharg Fulfill the contract obligations and then duties are discharged

Dana enters into a contract with Harley to buy Harley's land based on Harley's statement that the land consists of 350 acres. Harley is mistaken. The land is only 324 acres. But Harley was not aware of the mistake. Refer to Fact Pattern 15-A3. Dana can avoid the contract

if the misrepresentation of material

County Title Company processes information furnished by others to transfer title to real estate from a seller to a buyer. In performing this task for a sale of land from James to Kate, the furnished information is mistaken. Refer to Fact Pattern 15-A2. The contract between James and Kate that includes the mistake may be rescinded

if the mistake involves a material fact

A contract for a purpose that causes the parties to violate a law is:

illegal and void

A contract for a purpose that causes the parties to violate a law is:

illegal and void.

Which of the following describes conditions that are inferred from the nature and language of the contract?

implied

Sal has ordered 100 pounds of shrimp for his restaurant from Sam every Friday for 5 years and has always paid that week's market price. One Friday, Sal decides to take a vacation but doesn't tell Sam. Sam claims they have a contract, even though it was never written down. What kind of contract do they have?

implied-in-fact

If the plaintiff wants a court order requiring the defendant to stop doing something, the plaintiff is seeking a(n) _____.

injunction

This is a statement clearly proclaiming that this writing is the "full and final expression" of the parties' agreement and that anything said before signing or while signing is irrelevant

integration clause

When ambiguity in a contract's language exists, a court will: (Select all that apply)

interpret the terms against the drafting party

courts rarely rule _________ of a party as a cause for lack of capacity

intoxication

Eli and Marilyn ask Gracie to be the administrator of their will and the guardian of their children if they pass away before their children reach the age of majority. Gracie agrees. Fiduciary relationships such as this one

involve a high degree of trust and confidence.

An invitation to bargain

is not an offer

is not enforceable because it violates the statute of frauds.

An exculpatory clause is generally unenforceable when

it involves public transportation.

The common law process of _____ allows courts to review legislative and executive actions to determine whether they are constitutional.

judicial review

Aaron questions whether there is consideration for his contract with Banquet Hall to exchange his musical performance of country tunes at select social events for Banquet's payment of a certain amount. To constitute consideration, the value of whatever is exchanged must be

legally sufficient

Marketing Solutions Inc. promises to employ Niki as a software engineer. In reliance on the promise, Niki quits her job with Online Ad Company, but Marketing Solutions does not hire her. Most likely, Marketing Solutions is

liable to Niki under the doctrine of promissory estoppel

Sully signs a contract to borrow $200,000 from Riverside Bank to buy a house. In the contract, Sully agrees to pay a certain rate of interest on the amount of borrowed funds at monthly intervals for thirty years. This debt is

liquidated

Which term refers to whether an offeree accepts an offer by promising, by making a down payment, or by performing? a. intent b. method of acceptance c. definiteness d. manner of acceptance

manner of acceptance

Alexis, a minor acting on her own, signs a contract to buy motorcycle and accessories from Bad Bikes dealership. Later, after taking possession, Alexis disaffirms the deal. She

must return both motorcycle and accessories

Vaughn, an accountant, certifies audited financial statements for Business Apps Corporation, his client, knowing that Business Apps will use the financial statements to obtain a loan from Capital & Credit, Inc. Vaughn believes that the financial statements are accurate and does not intend to deceive Capital & Credit, but he does not review the statements before certifying them. The financial statements overstate Business Apps's earnings. Refer to Fact Pattern 15-A4. On learning the truth, Capital & Credit's chief loan officer confronts Vaughn, who says, "I didn't know." This is

negligent misrepresentation

Lea signs a contract with Metro Business Loans, Inc., to borrow $25,000 to remodel Lea's Hair Care Salon. Lea does not repay the loan. Metro fails to sue within the time prescribed by the applicable statute of limitations. Later Lea promises to pay the debt. To be enforceable, this promise needs

no consideration

Shannon signs a contract with Tevin, an unlicensed contractor, to build a deck and gazebo at the rear of her house. Shannon's state requires contractors to be licensed for consumer protection. This contract is enforceable by

no one

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 a. enforceable because the agreement accomplishes Ben's goal of keeping Becky from drinking. b. not enforceable because Becky does not have a legal right to drink alcohol. c. enforceable because Becky is giving up the right to do something she would otherwise be entitled to do. d. not enforceable because Becky is a minor and could disaffirm the contract.

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

D'Sean promises to pay his personal assistant Edie $50,000 in consideration of the services she provided over the years. D'Sean never makes the payment. D'Sean's promise is

not enforceable because the consideration is in the past

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!" John has a. made an acceptance to the first person who can produce $100. b. made a firm offer and will be bound by his offer for a reasonable period of time. c. made an offer to anyone within hearing distance and will be bound by his offer to the first person who produces $100. d. not made an offer because under the circumstances a reasonable person would not conclude that John had intent to make an offer.

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

Maya's motorcycle is damaged in an accident caused by Luc's negligence. Luc agrees to pay Maya $25,000 if she agrees to release him from further liability. Maya agrees. If her damages ultimately exceed $25,000, she can

not recover the balance

difference between the common law rule and the UCC rule is that the Code does require what

not require all of the terms of the agreement to be in writing

A promise to do something that you are already obligated to do is _____.

not valid consideration

Dwight believes that a new phone to be sold by Ear Candy Corporation will become the most widely bought and used phone in the global market. Dwight enters into a contract to buy 500 shares of Ear Candy stock, anticipating an increase in its value. If the price of the stock does not rise, Dwight can recover

nothing

The communication requirement of an offer requires:

the offeror to inform the offeree about the offer in some effective way. The offeror can write, fax, email, tell, or otherwise inform the offeree about the offer to satisfy the communication requirement.

novation

By action of the parties (termination of the offer)

o Revocation - The offeror can revoke the offer before the offeree accepts. o Rejection - The offer is terminated when the offeree rejects the offer. This includes counteroffers. Suppose Lindsay states she will buy Lorenzo's Maserati for $10,000, and Lorenzo responds by saying, "No, you can buy my Maserati for $95,000." Lorenzo has rejected Lindsay's offer, and he has made a new offer to Lindsay.

void agreement

occurs when the law permits one party to terminate the agreement A contract that neither party can enforce, because the bargain is illegal or one of the parties had no legal authority to make it

Voidable Contract

occurs when the law permits one party to terminate the agreement. A contract that may be legally avoided at the option of one or both of the parties.

a statement or act by the offeror to the offeree promising to perform or refrain from performing some act

offer

Jaime offered to buy Kevin's bike. Jamie is the a. offeror. b. mortgagor. c. trustee. d. offeree.

offeror.

An insurance contract is NOT considered to be an illegal form of "wagering" because a. one must have an insurable interest in the person being insured. b. insurance activities are regulated by the state department of insurance. c. the money being paid out comes from premiums collected over time. d. insurance contracts are underwritten by reputable companies.

one must have an insurable interest in the person being insured.

Quay Trucking Service tells Rafe that it will pay him $50 if he unloads a certain truck at the Shipping Warehouse. Rafe's acceptance is complete

only after Rafe unloads the truck

If a person is misled by the innocent misrepresentation of another party, the misled person can _____.

only rescind the contract

Helen finds a piece of land that she is interested in purchasing. She asks Robert, the landowner, to hold the land for her while she makes a decision. Robert says that for $1,000, he will hold the land for her while she decides, and Helen agrees. This is an example of a(n) _____.

option contract

Francis drives a delivery truck for Weston Industries. In the middle of his delivery route, Francis stops to have a two-hour lunch with friends twenty miles away. While in the restaurant, Francis slips on a puddle left by an employee and injures himself. Francis would normally be considered to be acting:

outside the scope of employment.

a merchant from the United States and a merchant from England sign a written contract for the sale and shipment of "jumpers." When the shipment arrives from England, the U.S. merchant is angered to find a box of sweaters instead of dresses and sues the English merchant for a breach of contract. The English merchant claims that "jumpers" clearly mean sweaters while the US merchant claims "jumpers" clearly mean dresses. Because the term "jumper" is vague and can have different meanings, the courts will allow________ to supplement to explain the term "jumper"?

parol evidence

requires a written contract to be the final and complete agreement between the parties. the written document speaks for itself.

parol evidence

Pat is a contractor who sometimes hires Sophie to do excavation work. Pat is having trouble selling some old equipment and decides to give it to Sophie. A few months later, Pat needs some excavation work and asks Sophie to do the work. Sophie asks for money, but Pat says, "I gave you some old equipment so you should do this work for no charge. Describes what consideration?

past consideration

Marte hires Pilar to represent her in a lawsuit. Pilar is not a licensed attorney, although she claims to be one, so the contract between Marte and Pilar

will not be enforced

If two parties have an on-going oral agreement that that one will ship and the other will accept 50 pounds of produce each week unless the buyer informs the seller one week before not to ship the next order, then the buyer's failure to speak up and tell the shipper not to send the produce:

qualifies as acceptance of that week's delivery offer.

What is the principle that is applied to determine how much compensation a party receives in a quasi-contract settlement?

quantum meruit

Specific performance is a remedy which is always available in:

real estate contracts.

The _____ standard is a measurement of the way members of society expect an individual to act in a given situation.

reasonable person

Riverroad Transport contracts with Food Equipment & Supplies, Inc., to transport grain to a certain destination for $5,000. Riverroad delivers the goods, but Food Equipment & Supplies does not pay. Riverroad learns that the goods were stolen. Riverroad can

recover $5,000 from Food Equipment and Supplies

the method a court uses to compensate an injured party? The first step that a court takes in choosing a remedy is to decide what interest it is protecting

remedy, interest

require Shania to go through with the sale.

Following negotiations with Gourmet Restaurant, Herb enters into an informal contract to park Gourmet's customers' cars. This means that the parties' contract

requires on special form

What is the primary purpose of the Statute of Frauds?

requiring written evidence of agreements concerning important transactions

What is the primary purpose of the Statute of Frauds? preventing fraudulent behavior in the formation of contracts ensuring that all details of a contract are well defined requiring written evidence of agreements concerning important transactions defining who may testify in a dispute over a contract

requiring written evidence of agreements concerning important transactions

Creighton applies to BigData Corporation for a position as a software engineer. Creighton knowingly has no training in computers or programming and no background as an engineer. After Creighton is hired, BigData learns the truth. BigData can

rescind the contract on the basis of fraud

An assignment is the transfer of:

rights

signing an amendment, crossing out the incorrect language and replacing it by hand with the correct terms, or rewriting the entire contract to include the changed provisions.

Bargained-For Exchange

something of value exchanged by the offeror and offeree that distinguishes gifts from contracts Each party negotiates and agrees to give and take something of comparable value.

Consideration

something of value exchanged for something else of value Contracts cannot be a one-way street; both sides must receive some measurable benefit.

requires that certain types of contracts must be in writing in order to be enforceable

statute of frauds

Upon graduating from college, Kathy announced her plans to enter law school the following fall and to marry Rick in December. Kathy's father was afraid that marriage during her first year in law school might cause her to fall behind in her studies or cause her to drop out of school. He called Kathy and promised her $10,000 if she postponed her wedding until after completion of her first year of law school. Kathy agreed and postponed the wedding for a year. Kathy successfully completed her first year of law school, but soon thereafter, Kathy's father died. The administrator of her father's estate claimed she was not entitled to the $10,000 because there was no consideration for her father's promise. If Kathy sues the estate, she will probably be a. unsuccessful because it was merely fatherly advice not to get married during the first year of law school. b. unsuccessful because her father received no benefit. c. unsuccessful because her father's death terminated the contract. d. successful because there was consideration.

successful because there was consideration

A _____ cause is an unforeseeable event which interrupts the causal chain between the defendant's breach of duty and the damages the plaintiff suffered.

superseding

Rafi offers to sell his sailboat, Sea Siren, to Tiara for $50,000. Referring to the prices for similar vessels, Tiara says, "If I were to buy, I would pay no more than $40,000." Rafi's offer is

terminated

if instead of a car the item for sale is an animal and the law changes to protect that animal from private ownership, the offer is __________

terminated by law

Noah tells Ivy he is willing to sell his comic book collection to her for $100. Ivy says no, she would rather save her money to buy a new cell phone. What just happened? a. termination by rejection b. termination by expiration c. termination by operation of law d. termination by revocation

termination by rejection

The weekly Kroger advertisement states that five-pound chubs of ground chuck are available for eighty-nine cents per pound. Arlene sees the advertisement; she realizes that ground chuck has not been priced this low in quite some time, so she hurries to the store to purchase some. Arlene loads seven chubs of ground chuck in her shopping cart. When she goes to the checkout to pay, however, the cashier informs Arlene that the price in the advertisement is a typo and that the correct price is $1.89 per pound. Arlene insists that the store must honor the price listed in the advertisement, because it is an offer that she has just accepted. The cashier calls the store manager for a decision. The store manager will likely explain to Arlene:

that advertisements are not offers, but merely a request for offers.

Milo is the owner of a sporting goods store that has only been open for three months. The holiday season is coming up, and Milo realizes that he will need extra help. Milo asks his friend Jess to help him out at the store. Milo and Jess agree that Jess will work during the months of November and December. However, because Milo is unsure how much help he will need and how much he will be able to pay, they agree to decide each week on the hours that Jess will work for the following week, and to decide the hourly rate after Jess has worked two weeks before she receives her first paycheck. Just before November 1, Jess takes a job at another store. If Milo tries to sue Jess for breach of contract, the court will probably decide:

that the parties had no contract because the terms of the offer were not definite.

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, a. Mary's balance will automatically be paid in full regardless of whether the amount of $3,800 was liquidated or unliquidated. b. Mary's balance will automatically be paid in full if the $3,800 amount was a liquidated debt. c. Mary's balance will automatically be paid in full if the $3,800 amount was an unliquidated debt. d. the check may be subject to a UCC exception to the general rules for accord and satisfaction cases involving checks.

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

the children may be able to void the contract based on undue influence.

When a rainstorm erupts outside Rita's Souvenir & Gift Shop, Rita and Shaw enter into an implied contract to split the revenue from Shaw's sale of umbrellas to Rita's customers. The terms of this contract are defined by

the conduct of the parties

What happens when a party with the right to avoid a contract chooses to not avoid it?

the contract is ratified

If Morales and Rolfes Supply negotiate for the purchase and sale of a supply of fuel for a three-year period for Morales' business, a. the contract price must remain the same for the entire three-year contractual period. b. their contractual requirements regarding definiteness would be the same under the UCC and the common law. c. the contract may indicate a method for determining the price, without stating a definite price. d. Morales and Rolfes must depend on the UCC's gap-filler provisions to determine a price since the fuel is a "good" covered by Article 2 of the UCC.c

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

the court would probably enforce the deal because there was valid consideration on both sides.

To succeed on a promissory estoppel claim, and plaintiff must show: (Select all that apply)

the defendant knew the plaintiff would rely on the promise. the plaintiff relied on the defendant's promise. the defendant made a promise to the plaintiff

A national bank based in New York issues credit cards to customers in all 50 states. What interest rate can the bank charge customers? a. the interest rate of New York or that of the customer's state, whichever is higher b. the interest rate of New York only c. the interest rate of New York or that of the customer's state, whichever is lower d. the interest rate of the customer's state only

the interest rate of New York or that of the customer's state, whichever is higher

Omar asserts that a deal he entered into with Patty to sponsor and host a motivational conference for independent sales representatives is an unenforceable contract. Defenses to the enforcement of a contract include

the lack of voluntary consent

Without a time condition in an offer, the offer will expire after _____.

the lapse of a reasonable time period

Capacity

the legal ability of the principal to make contracts based on age and mental state

Remedies

the legal means to enforce a right or redress a wrong A court will award money or other relief to a party injured by a breach of contract. The relief given to an innocent party to enforce a right or compensate for the violation of a right.

An acceptance must exactly match the terms of the offer in order to be valid. This is known as:

the mirror image rule. If an acceptance does not mirror the terms of the offer, as required under the mirror image rule, it is not an effective acceptance but a counteroffer

In a non-compete agreement, the term "ancillary" means that a. both parties must have a stake in the outcome. b. the non-compete agreement must be part of a larger agreement. c. the non-compete agreement is unfair to the employee, but not the employer. d. the agreement is harmless to the general public.

the non-compete agreement must be part of a larger agreement.

In a non-compete agreement, the term "ancillary" means that: both parties must have a stake in the outcome. the agreement is harmless to the general public. the non-compete agreement must be part of a larger agreement. the non-compete agreement is unfair to the employee, but not the employer.

the non-compete agreement must be part of a larger agreement.

In order to determine a party's intent in a contract case, a court will apply:

the objective theory of contracts. In contract disputes, a court will determine a contract party's intent by looking at the outward, objective facts, as they would be interpreted by a reasonable person.

If an offer specifies no time limit in which to accept, a. the offeree has 30 days to respond. b. the offer is not valid and therefore it does not matter when the offeree responds. c. the offeree has 10 days to respond. d. the offeree has a reasonable period during which to accept.

the offeree has a reasonable period during which to accept.

When bargains are so oppressive that the court decides to relieve innocent parties of their duties, such bargains are deemed

unconscionable

Nelson, a minor, misrepresents his age when agreeing to a contract to buy a restored, antique soda vending machine from Old Is New Again, Inc. Ordinarily, Nelson can disaffirm the contract

under any circumstances

Mateo is sixteen years old and just got his first job bagging groceries at Harry's Market, a local grocery store. During the school year, Mateo works limited hours after school and on the weekends. Now that school is out, Harry's Market increases Mateo's hours to six days a week and eight hours a day. Mateo's mother Isabel is concerned about Mateo working such long hours. She knows there is a federal law, the Fair Labor Standards Act (FLSA), that protects children from working long hours and too many days per week. When Isabel raises the issue with Mateo's supervisor, Mateo's supervisor explains to Isabel that:

under the FLSA, children who are sixteen or seventeen years old may work unlimited hours as long as they work in nonhazardous jobs.

Anna's attorney Sergio is discussing with Anna her willingness to sell property to his partner. Sergio reminds Anna that he has never led her estray in all the years he has helped her. He continues to persuade Anna that it is a great deal to sell her property to his partner. This is a form of _____.

undue influence

Any contract to commit a crime is in violation of a statute and therefore

unenforceable

Teatro Restoration, Inc., begins renovating an old theater for Urban Edge Productions, but after three months Teatro demands an extra $250,000. Urban Edge agrees to pay. Refer to Fact Pattern 13-A2. If Teatro says it is asking for the extra $250,000 because forseeable business expenses have increased, the agreement is

unenforceable due to the preexisting duty rule

the set of uniform laws that govern commercial transactions

uniform commercial code

In general, a _____ mistake does not generally void a contract.

unilateral

Barry tells Olivia, his neighbor's daughter, that he will pay her $50 if she pulls weeds and trims the bushes in his yard. When Olivia comes to Barry's house and begins the work, she has accepted his offer with her actions. Is an example of?

unilateral contract

Brindley has an old shed on her property that needs to be removed. She posts the following ad on Facebook: "Shed needs to be gone. You take down and haul away. (Much of the wood is reusable.) $100 to the first person to show up and haul this away." This is an example of a(n):

unilateral contract

What is the term for a contract agreement in which an offeror promises to pay after the occurrence of a specified act, and the offeree is not required to respond in words?

unilateral contract

a binding agreement in which one party has made an offer that the other party can accept only by action, not words

unilateral contract

Contests, lotteries, and competitions with prizes are common examples of:

unilateral contracts

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 a. bilateral, implied contract. b. unilateral, express contract. c. bilateral, express contract. d. unilateral, implied contract

unilateral, implied contract

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.

In order for an accord and satisfaction to be valid, the debt must be

unliquidated.

A dispute over a(n) _____ debt may be settled for less than the full amount if the parties enter into a(n) _____.

unliquidated; accord and satisfaction

A(n) _____ contract is one that contains all the legal elements of a contract.

valid

____________ - If the party has not been judged to be mentally incompetent in the past and is able to understand the terms of the contract, the contract is valid

valid

The two elements of consideration are:

value, bargained for exchange

Which of the following is the proper term for the geographic location that each state's statutes determine is proper to hear a case?

venue

Alvin's Department Store agrees over the telephone to purchase $1,000 worth of blankets from Blanket Emporium. Blanket Emporium sends an invoice for the blankets before shipping them, and Alvin's Department Store refuses to go forward with the deal, saying their deal is not a valid contract. The oral agreement between Blanket Emporium and Alvin's Department Store for the purchase of $1,000 worth of blankets:

violates the statute of frauds, and is, therefore, unenforceable.

A(n) _____ contract is, in effect, not a contract at all.

void

If a court had previously determined the party to be mentally incompetent, the contract is ________

void

a contract having no legal force or binding effect describes

void

A contract for an illegal purpose is:

void.

A contract for an illegal purpose is: dischargeable. voidable. enforceable as a quasi-contract. void.

void.

A person who is mentally impaired generally can create only __________ contracts. fraudulent void unconscionable voidable

voidable

If the contract is based on a fundamental factual error by both parties, the contract is ________ by either one

voidable

What type of contract exists when at least one party has the option of canceling it?

voidable

What type of contract is created by an agreement that is oral when it is required by the Statute of Frauds to be in writing?

voidable

What type of contract is created by an agreement that is oral when it is required by the Statute of Frauds to be in writing? quasi fraudulent void voidable

voidable

_______ If the party has not been determined incompetent, but the party was incompetent at the time the contract was formed,

voidable

a contract that may be legally avoided [canceled] at the option of one of the parties describes

voidable

Chet, a minor, signs a contract with Porsha, an adult. The contract is

voidable at the option of Chet

Because their contracts are _____, minors have the right, until a reasonable time after reaching the age of majority, to _____, or avoid, their contracts.

voidable; disaffirm

True impossibility means that the promisor cannot do what?

what he promised to do

Acceptance

when the offeree says or does something that a reasonable person would understand to mean that the offeree definitely wants to take the offer. A second party's unqualified willingness to go along with the first party's proposal. Once a party receives an offer, the party must respond to it in a certain way.

unenforceable agreement

when the parties intend to form a valid bargain, but a court declares that some rule of law prevents enforcing it

Marla offers to sell Kennedy her property on Lake of the Ozarks for $90,000. Marla drafts a written agreement that contains the property description and price, and has places for both Kennedy and Marla to sign. Marla sends the agreement to Kennedy to review. Kennedy signs the agreement and sends it back to Marla, who never signs it. Marla then has second thoughts about the deal and refuses to complete the transaction. If Kennedy tries to enforce the contract against Marla, Kennedy:

Business Law Unit 3

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