Exam 8: Factors Affecting the Contractual Relationship

What is the significance of an assignment qualifying as a statutory assignment?

Explain what is meant by an "involuntary assignment."

Although Zlotnic had been in business a long time, he had been forced to borrow heavily in the last few years. When his debt reached the limit of his line of credit, $100,000, the manager of the Regal Bank called him in for a talk. Subsequently, Zlotnic sold his house for $250,000 to the Johnsons. He contracted to buy another house from the Scotts. From the proceeds he anticipated receiving from the Johnsons, he assigned $200,000 to the Scotts, the purchase price of Scott's house, and assigned $50,000 to the Regal Bank to reduce his debt. The assignment to the Scotts was in writing; the assignment to the bank was not. The Scotts gave written notice of the assignment to the Johnsons on March 1, the day the money was owed to Zlotnic. Johnson verified the assignment and paid out the $200,000 to the Scotts. On March 2, the Regal Bank gave written notice of its assignment to the Johnsons. Unfortunately, at that time only $45,000 was owing to Zlotnic because the Johnsons had paid $5000 to the Canada Revenue Agency for Zlotnic. On these facts, which of the following is true?

If Mills agreed to sell Boothe a used Nissan automobile, which in the contract was described as a 2012 Nissan Murano with a rebuilt transmission, Boothe could sue for ________ if the vehicle turned out to be a 2010 Murano and the transmission was used, not rebuilt.

Misgana ran into Tarja at their local gym. Tarja, it turns out, operated an art gallery that did custom framing and mounting. Misgana had some beautiful prints she wanted to have put into special frames and agreed to pay Tarja $400 to have this done. Tarja passed the task along to her new assistant, Shandy. Shandy used the wrong adhesive when mounting the prints, which meant they did not stick properly to the backing. Which of the following is true?

Explain what is meant by a "trust."

Adam bought a boat from Charlie for $900 payable on November 6. On November 6, when Charlie came for the money, Adam didn't have it. Adam was, however, employed by Ms. Bey to do some market research. He was to be paid $1000 for his report, due on November 12. Charlie wanted an assignment of $900 of the amount Adam expected to receive November 12. Adam wrote out an assignment with all the essential information and signed it. Charlie gave written notice of the assignment with all pertinent information to Ms. Bey the next day, November 7. On November 12, Adam had not finished his report. The contract provided that he would lose $100 for every week he was late. Adam was two weeks late in submitting his report. Which of the following is true?

Distinguish between duress and undue influence.

In Sylvan Lake Golf & Tennis Club Ltd. v. Performance Industries Ltd., the defendant attempted to take advantage of a mistake made by the plaintiff. What did the Court hold?

When the courts find that undue influence is present, the resulting contract is

The victim of fraudulent misrepresentation retains the right to have the parties to the contract returned to their original positions but not to be reimbursed for any out-of-pocket expenses.

The law attempts to help persons who may feel forced to enter contracts. Which of the following is false with regard to the law of undue influence, duress, etc.?

What does it mean that an assignee is "subject to the equities"?

The major problem with fraudulent misrepresentation is the need to establish that the person being sued knowingly misled the victim.

The doctrine of privity of contract is unique in that is has no exceptions.

Indicate what must be present in order for an assignment to qualify as a statutory assignment.

Mr. Frank, a foreman supervising some 43 employees, was asked by his secretary to sign a form requesting additional supplies needed on the factory floor. He was not careless when he examined the form, but his secretary had cleverly arranged the signature line so that instead of signing a request for supplies he signed a cheque payable to his secretary. What principle, if any, would be used to defend against her action on the cheque?

What's the effect of a court determining that undue influence has been present in a contractual relationship?

With regard to the law concerning misrepresentation, which of the following is true?

When parties enters into a contract where a claim is made that a bargain is unconscionable, which of the following is correct?