A
If the offeror emails an offer to the offeree, and the offeree faxes the acceptance, when will the acceptance be considered to have been made and the contract formed?
A. When offered
B. When received
C. When sent
D. When written
B. When received
Agreeing to give false testimony in exchange for $10,000 negates which of the five contract elements?
A. Capacity
B. Consideration
C. Offer
D. Legality
D. Legality
Both the collector-seller and the violinist-buyer believed two violins were a Stradivarius and a Guarnerius. In fact, both violins were imitations.
Yes or no: Is this a bilateral mistake, so that avoidance or rescission is possible?
What is yes!
A threat against a person’s business would give rise to what defense?
A. Unilateral mistake
B. Fraud
C. Involuntary consent
D. Legality
C. Involuntary consent is the type of defense
Specifically, it is involuntary consent by duress!
John proposes to sell his car to Janice on Friday for $500. Is this a valid offer?
A. Yes
B. No
A. Yes
We know the parties
We know the object (car)
We know the consideration ($500)
We know the time for performance/payment
Bill and Sarah agreed at lunch to a contract for Bill to perform landscaping services at Sarah's house on March 31st in exchange for payment of $100. Bill did not have the contract form for Sarah to sign. What type of contract is this?
A. Oral/Spoken
B. Unenforceable
C. Valid
D. Written
A. Oral/Spoken
Because it is not a contract for land, in anticipation of marriage, surety, or requiring more than 1 year to complete, it is okay to not be in writing. We have no Form defense here, i.e., no Statute of Frauds defense.
Neither party knew about a defective septic system that made the property unfit to live in.
Yes or no: Is this a bilateral mistake, so that avoidance or rescission is possible for the buyer?
What is yes!
However, the court in the actual case denied rescission despite finding mutual mistake! The court looked to the contract's “as is” clause, which put that septic system risk on the buyers.
Fred and Dale have a contract in which Dale would buy Fred's house for $400,000 on April 1st. But on March 20th, Fred gets a better offer from a married couple. So, Fred invites Dale to the house and asks Dale politely to cancel their deal while pointing a pistol at Dale. Dale cancels his contract. What would Dale argue?
A. Bilateral mistake
B. Duress
C. Fraud
D. Unilateral mistake
B. Duress
Dale would argue that he lacked voluntary consent because of duress. His acceptance was unenforceable despite being valid on the face of the document.
24. Amber transfers her duty of cleaning Julie’s house to Roxanne. However, Amber is still responsible for the job. How was the contractual obligation transferred?
A. Assignment
B. Breach
C. Delegation
D. Novation
C. Delegation
Mark walks up to Jill at the farmers market and says, "I will give you $50 for that painting." Jill hands Mark the painting and he gives her $50. The contract was likely:
A. Executory
B. Implied
C. Bilateral
D. Unilateral
D. Unilateral
Curt and Carrie agree over lunch that Curt will sell Carrie his house for $5,000 on April 4th. The next day, Curt has second thoughts and tells Carrie he no longer wants to sell the house. If Carrie sues Curt, will she prevail?
A. Yes
B. No
B. No, because Curt can successfully raise the defense of the Statute of Frauds. That state statute required a contract for land to be in writing. It was not written but was instead merely spoken.
A builder signed a construction contract that incorporated the owners’ detailed specifications. He later said he understood the job differently and believed his own, less demanding specifications governed.
What is "hell no?"
The court held that one party’s misunderstanding of a written contract he had signed, which the other party did not cause, did not let him escape it. The builder was liable for refusing to perform.
Pam's guardian, Newt, induces her to sign a contract to invest her student loan funds in Overseas Bank through Newt’s investment firm. Unbeknownst to Pam, Newt realizes ongoing commissions from Pam’s investment in Overseas Bank. Pam's investment suffers a significant loss, but Newt retains his commissions. Most likely, Pam may ____.
A. Not rescind the contract
B. Rescind the contract on the basis of undue influence
C. Rescind the contract on the basis of mistake
D. Rescind the contract on the basis of fraud
B. rescind the contract on the basis of undue influence
Mark rents a house owned by Bill. Bill later transfers his right to rent payments to Bob. What is this?
A. Assignment
B. Breach
C. Delegate
D. Novation
A. Assignment
When Donnie, Matt, and Steve, all age 15 enter into a contract, what term describes this type of contract?
A. Bilateral
B. Valid
C. Void
D. Voidable
D. Voidable
It has the possibility of being valid for all parties when the minors reach 18 and affirm it. So, it's voidable.
Carter Construction is building the new civic arena. The construction is expected to take 2.5 years to complete. The contract must be in writing according to ___.
A. Commercial Building Code
B. Statute of Frauds
C. Statute of Limitations
D. Uniform Commercial Code
B. Statute of Frauds (the "gotta-have-a-writing statute")
Amber transfers her duty of cleaning Julie’s house to Roxanne. However, Amber is still responsible for the job and can be sued by Julie if Roxanne fails to do much of anything right. What kind of action would Julie bring against Amber and Roxanne if -- according the community (reasonable person standard) -- Roxanne fails to satisfactorily perform the services?
A. Assignment
B. Breach of Contract
C. Delegation
D. Novation
C. Breach of Contract
After being offered a new car at a discount, Lisa decided to turn down the offer. How was this contract terminated?
A. Referral
B. Refusal
C. Rejection
D. Revocation
C. Rejection
6. Marco and Angelica are purchasing their first home. What law requires that their contract be in writing
A. Parol Evidence
B. Promissory Estoppel
C. Statute of Frauds
D. Statute of Limitations
C. Statute of Frauds
Nancy contracted with Bryan to buy Bryan's car. The next day, however, Nancy realized she could not afford the car's price and Bryan regretted parting with his beloved car. What method of termination could they take?
A. Mutual agreement
B. Impossibility of performance
C. Operation of law
D. Impracticability of Performance
A. Mutual agreement
Yes, having made a contract, the parties can make a second contract that has as consideration the promises to not give the car and not give the money. That's termination by mutual agreement.
Monica has a contract with Fred's Landscape Service to mulch her yard. After the job is finished, the contract is discharged by what method?
A. Complete Performance
B. Operation of Law
C. Substantial performance
D. Specific Performance
A. Complete Performance
If business competitors of goods all agree to charge a set price (often higher), their contract would violate which element?
A. Capacity
B. Consideration
C. Legality
D. Offer
C. Legality
It's an agreement that is anti-competitive, monopolistic/oligopolistic
Both farmers believed a purebred cow, “Rose 2d of Aberlone,” was barren and priced her as beef. She was, in fact, pregnant, and as a breeding cow, she was worth far more.
Yes or no: Is this a bilateral mistake, so that avoidance or rescission is possible for the selling farmer?
What is yes!
Carol agreed to make Debbie’s prom dress with a cape and gloves. But as the date of delivery approached, Carol was pressed for time and forgot to make the gloves. In response to Debbie's claim of contract breach, what is Carol's argument?
A. Satisfactory Performance
B. Substantial Performance
C. Tender of Delivery
D. Timely Performance
B. Substantial Performance (with minor breach)
Carol is performing services for Debbie, which makes it a common law contract. Substantial performance is available in common law contracts, not UCC contracts.
Betty lost her wallet at a school ballgame. She offered a reward of $25 to anyone who found and returned the wallet to her. What type of contract was that if someone does indeed bring the wallet to Betty?
A. Bilateral
B. Implied
C. Unilateral
D. Void
C. Unilateral
The owner sold a stone to the buyer for $1. Neither was an expert. They later learned that the stone was an uncut diamond worth $5 million.
Yes or no: Is this a bilateral mistake, so that avoidance or rescission is possible for the seller of the stone?
What is no!
Mistakes of value are not eligible for rescission, regardless of whether the mistake was unilateral or mutual/bilateral.
A 40-story, 400-unit office building is completed on time but one office space kitchen has a slightly different tile floor than required by the contract. How would the construction company argue that the contract was discharged?
A. Complete performance
B. Substantial performance
C. Material breach
D. Wrongful alteration
B. Substantial performance (with minor breach)
In common law, substantial performance is available if the minor breach was not purposeful, gives the other party the same basic benefit of the bargain, and does not deviate to greatly.
Jennifer asked Jason if he wanted to buy her car. Is this a valid offer?
A. Yes
B. No
B. No
It lacks definiteness despite showing intent to be bound and communication. Why? We don't know the time for performance/payment?
The buyers bought land to grow jojoba commercially. Both the seller and buyers believed enough water was available for that use. Insufficient water existed in fact.
Yes or no: Is this a bilateral mistake, so that avoidance or rescission is possible for the jojoba-farming buyers?
What is "yes!"
The court found bilateral mistake and allowed rescission with restitution measured against the parties’ original positions.
In response to John’s offer to sell his truck for $500 on May 1st, Jason says he will buy the truck and John's boat trailer for $500 on May 1st. Is this a valid acceptance?
A. Yes
B. No
B. No
Jason violated the mirror image rule when accepting, which terminates the offer and permits John to now treat the truck & trailer proposal as a counteroffer.
A paving subcontractor made a cost-estimating error in its bid to a general contractor. The bid was roughly half what the work actually cost. The general contractor relied on the paving subcontractor's erroneous bid in its own winning bid to the school district.
Yes or no: Is this a bilateral mistake, so that avoidance or rescission is possible for the paving subcontractor?
What is "no?"
The California Supreme Court held the subcontractor to its bid under promissory estoppel. Because the general contractor had no reason to know of the error, the mistake was the subcontractor’s burden to bear.
A world-famous artist dies suddenly before finishing several projects. How will all of the artist’s contracts be discharged?
A. Breach of Contract
B. Mutual Release
C. Impossibility of Performance
D. Substantial Performance
C. Impossibility of Performance
Unable to pay off a $250 contract, Jon requested that the contract be changed so that he may instead give Peter some property worth $250 instead of cash. If Peter agrees to the change, how was the contract discharged?
A. Accord and satisfaction
B. Complete performance
C. Specific performance
D. Wrongful alteration
A. Accord and satisfaction
Accord = please accept different consideration
Satisfaction = agreeing to accept the different consideration.
A detective caught a suspect who intentionally set fire to a pharmacy. The appreciative pharmacy owner offered the detective a gift. Why is the detective not allowed to accept the gift?
A. Past consideration.
B. Pre-existing duty.
C. A promise to make a gift.
D. A promise to obey the law.
B. pre-existing duty.
An injured person signed a settlement release/waiver after an accident, believing an injury was limited or minor, when in fact the injury was serious and unknown.
Yes or no: Is this a bilateral mistake, so that avoidance or rescission is possible?
What is "yes!"
In two separate cases, the court held that a mutual mistake about the injury's existence or nature could void the release.
Steve contracted with Greg to purchase Greg’s riding lawnmower. After the contract was signed, Greg changed the price from $150 to $250 without Steve’s knowledge and invoiced Steve for the higher amount. What method of termination is this?
A. Agreement
B. Impossibility of performance
C. Operation of law
D. Performance
C. Operation of law
This is wrongful alteration of a legal document we now know as forgery. The law punishes the evil conduct by terminating the contract completely. Steve can also now press criminal forgery charges against Greg.
After agreeing to sell her home to Jack, Lila refuses to turn over the paperwork due to a better offer from Sam. Jack should sue for what remedy?
A. Money damages
B. Nominal damages
C. Punitive damages
D. Specific performance
D. Specific performance