CH 15 Review Test

(T/F) If contracting parties attach materially different meanings to a contract word or term subject to more than one reasonable interpretation, the contract is void.

False

(T/F) The essential feature of undue influence is that a party being taken advantage of suffers from a mental or physical impairment.

False

(T/F) Because of the potential for punitive damages, plaintiffs often include a claim for fraudulent misrepresentation in their contract disputes.

True

Carlos and David contract for the sale of five hundred head of Carlos's cattle for $195 per head. Unknown to either party, an unforeseen storm has struck the herd and many of the cattle have died. David is a. not required to pay due to the bilateral mistake. b. entitled to recover the value of the lost cattle. c. not required to pay due to the unilateral mistake. d. required to pay because he assumed the risk the cattle might die.

a.

Big Dig LLC makes an offer to perform an excavation and related tasks for Commercial Development Corporation, but due to a substantial mathematical mistake, significantly underprices the work. Commercial accepts the offer. Data Big's best defense against enforcement of the contract is that Commercial knew a. a unilateral mistake supports the cancellation of a contract. b. the price was below the prices of comparable services. c. a bilateral mistake supports the cancellation of a contract. d. a mistake of value supports the cancellation of a contract.

b.

County Title Company processes information furnished by others to transfer title to real estate from Dali to Ezra. The furnished information is mistaken. The contract between Dali and Ezra may be rescinded because the mistake a. may be rescinded if the mistake is subject to only one interpretation. b. may be rescinded because the mistake is about a material fact. c. may be rescinded because the mistake affects a third party. d. none of the choices

b.

Data Inc. offers to provide certain services to Enterprise LLC, but mistakenly transposes some of the digits in the price so that $15,400 appears in the offer as $14,500. Enterprise accepts the written offer. Enterprise's best argument in favor of enforcement of the contract is a. a bilateral mistake does not afford relief from a contract. b. a unilateral mistake does not afford relief from a contract. c. the price was below the prices of comparable services. d. a mistake of value does not afford relief from a contract.

b.

Orin, an employee of Plumbing LLC, makes a substantial mathematical mistake in totaling the estimated costs for a project for which Quality Built Inc. is seeking bids. Consequently, Plumbing's bid is significantly low. Any contract with Quality Built that includes the mistake may be rescinded a. if Orin's supervisor did not know of the mistake. b. if Plumbing knew or should have known of the mistake. c. if Quality Built knew or should have known of the mistake. d. under no circumstances.

c.

Restaurant Food Inc. intends to sell a certain quantity of beef for $1,100. In e-mail, however, the firm's sales representative mistakenly offers to sell the beef to Steak House for $1,000, Steak's manager immediately accepts. The seller a. is bound to the deal at the offered price. b. is bound to the deal but can charge the intended price c. can rescind the deal. d. is bound to the deal at the offered price.

d.