Question 1

If the values of the items exchanged in a contract are unequal courts generally:

Accepted Answer

A)  hold that the contract is not binding 
B)  require the parties to rewrite the contract 
C)  support the contract anyway 
D)  require the offeror to add something to the contract 
E)  require the offeree to add something to the contract 
A)  hold that the contract is not binding 
B)  require the parties to rewrite the contract 
C)  support the contract anyway 
D)  require the offeror to add something to the contract 
E)  require the offeree to add something to the contract

Question 2

When the courts use the doctrine of promissory estoppel (detrimental reliance), it means that despite the lack of the elements of a contract, the court may require payment to be made as if a contract had existed.

Accepted Answer

A) True 
 B)False

Question 3

To make an offer, the offeror must:

Accepted Answer

A)  have the intent to be bound to the contract, and that intent must be clearly expressed or manifested 
B)  have the intent to be bound to the contract, but need not express or manifest that intent 
C)  have filed a copy of the offer with the county court house 
D)  have written documentation of the intent 
E)  have known the offeree for at least 1 year 
A)  have the intent to be bound to the contract, and that intent must be clearly expressed or manifested 
B)  have the intent to be bound to the contract, but need not express or manifest that intent 
C)  have filed a copy of the offer with the county court house 
D)  have written documentation of the intent 
E)  have known the offeree for at least 1 year

Question 4

Offers may be terminated by the destruction of the subject matter of the contract.

Accepted Answer

A) True 
 B)False

Question 5

If the offeree does not accept the offer, after a reasonable length of time the offer may terminate through:

Accepted Answer

A)  lack of time 
B)  loss of time 
C)  excess of time 
D)  extension of time 
E)  none of the other choices are correct 
A)  lack of time 
B)  loss of time 
C)  excess of time 
D)  extension of time 
E)  none of the other choices are correct

Question 6

Which of the following is usually not a requirement for a contract to be valid?

Accepted Answer

A)  offer and acceptance 
B)  equal value in exchange 
C)  contractual capacity 
D)  purpose of contract must be legal 
E)  all of the other choices are required 
A)  offer and acceptance 
B)  equal value in exchange 
C)  contractual capacity 
D)  purpose of contract must be legal 
E)  all of the other choices are required

Question 7

In DeRosier v. Utility Systems of America, Inc. where DeRosier sued Utility Systems of America, Inc. for dumping too much fill dirt on his property, the appeals court held that:

Accepted Answer

A)  DeRosier's permit for dirt dumping was invalid 
B)  the trial court was wrong to award DeRosier general damages so he could have the excess dirt removed, but right to award additional consequential damages since there was a claim for delay damages in the pleadings or discovery 
C)  the trial court was wrong to award any damages to DeRosier 
D)  the trial court was correct is all its awards to DeRosier 
E)  none of the other choices are correct 
A)  DeRosier's permit for dirt dumping was invalid 
B)  the trial court was wrong to award DeRosier general damages so he could have the excess dirt removed, but right to award additional consequential damages since there was a claim for delay damages in the pleadings or discovery 
C)  the trial court was wrong to award any damages to DeRosier 
D)  the trial court was correct is all its awards to DeRosier 
E)  none of the other choices are correct

Question 8

When the party who breaches a contract has behaved maliciously and committed a tort, the court may want to discourage such behavior in the future by imposing what damages besides regular damages?

Accepted Answer

A)  compensatory 
B)  expectancy 
C)  liquidated 
D)  nominal 
E)  punitive 
A)  compensatory 
B)  expectancy 
C)  liquidated 
D)  nominal 
E)  punitive

Question 9

Misrepresentation, unlike fraud, is not grounds for rescinding a contract.

Accepted Answer

A) True 
 B)False

Question 10

You pay $200 for the right to be the only buyer a seller will deal with for ten days for a piece of property that is for sale for $250,000. This is:

Accepted Answer

A)  called a terminable contract 
B)  called an option contract 
C)  called a revocable contract 
D)  not a contract because the consideration is not relevant to the value of the property 
E)  none of the other choices 
A)  called a terminable contract 
B)  called an option contract 
C)  called a revocable contract 
D)  not a contract because the consideration is not relevant to the value of the property 
E)  none of the other choices

Question 11

____ occurs when someone is "forced" to sign a contract; that is, the contract is made because of a threat that gave no sensible way out.

Accepted Answer

A)  Duress 
B)  Fraud 
C)  Discomfort 
D)  Misrepresentation 
E)  none of the other choices are correct 
A)  Duress 
B)  Fraud 
C)  Discomfort 
D)  Misrepresentation 
E)  none of the other choices are correct

Question 12

An authoritative document that provides an orderly summary and presentation of the common law of contract is:

Accepted Answer

A)  the Restatement (2d) of Contracts 
B)  the Contracts Commercial Code 
C)  Cohen on Contracts 
D)  the Statute of Frauds 
E)  the Federal Register 
A)  the Restatement (2d) of Contracts 
B)  the Contracts Commercial Code 
C)  Cohen on Contracts 
D)  the Statute of Frauds 
E)  the Federal Register

Question 13

A transfer of contract rights to a third party is a delegation.

Accepted Answer

A) True 
 B)False

Question 14

An offer may be revoked before the offeree has a chance to respond to it.

Accepted Answer

A) True 
 B)False

Question 15

The primary purpose of a contract is to:

Accepted Answer

A)  make it easy to do international business transactions 
B)  encourage innovation 
C)  encourage investment 
D)  give parties confidence that they will make a profit 
E)  none of the other choices are correct 
A)  make it easy to do international business transactions 
B)  encourage innovation 
C)  encourage investment 
D)  give parties confidence that they will make a profit 
E)  none of the other choices are correct

Question 16

"I will pay you $100 to not sell your $500,000 house to anyone else for the next month so I can see if I can get the money together to buy it," you say. "Ok," says the home owner. The $100 payment is an option contract.

Accepted Answer

A) True 
 B)False

Question 17

Ads are usually considered:

Accepted Answer

A)  implied contracts 
B)  fully binding contracts 
C)  partially binding contracts 
D)  express contracts 
E)  none of the other choices are correct 
A)  implied contracts 
B)  fully binding contracts 
C)  partially binding contracts 
D)  express contracts 
E)  none of the other choices are correct

Question 18

Generally, minors and intoxicated persons have only partial capacity to contract.

Accepted Answer

A) True 
 B)False

Question 19

In DCS Sanitary Management v. Castillo, where a company had employees agree not to work for any competitors within 100 miles of any customer of DCS, the appeals court held that the agreement:

Accepted Answer

A)  overly broad and could not be enforced 
B)  violated public policy and that the company must pay damages to the employees 
C)  was not enforceable due to lack of consideration 
D)  was a reasonable restraint on competition that could be enforced 
E)  was a valid restraint on competition since such agreements are legal unless they violate the antitrust laws 
A)  overly broad and could not be enforced 
B)  violated public policy and that the company must pay damages to the employees 
C)  was not enforceable due to lack of consideration 
D)  was a reasonable restraint on competition that could be enforced 
E)  was a valid restraint on competition since such agreements are legal unless they violate the antitrust laws

Question 20

A ____ contract is one that is accepted by performance.

Accepted Answer

A)  bilateral 
B)  nonbinding 
C)  real 
D)  performance 
E)  none of the other choices are correct 
A)  bilateral 
B)  nonbinding 
C)  real 
D)  performance 
E)  none of the other choices are correct

Exam 10: Contracts

If the values of the items exchanged in a contract are unequal courts generally:

When the courts use the doctrine of promissory estoppel (detrimental reliance), it means that despite the lack of the elements of a contract, the court may require payment to be made as if a contract had existed.

To make an offer, the offeror must:

Offers may be terminated by the destruction of the subject matter of the contract.

If the offeree does not accept the offer, after a reasonable length of time the offer may terminate through:

Which of the following is usually not a requirement for a contract to be valid?

In DeRosier v. Utility Systems of America, Inc. where DeRosier sued Utility Systems of America, Inc. for dumping too much fill dirt on his property, the appeals court held that:

When the party who breaches a contract has behaved maliciously and committed a tort, the court may want to discourage such behavior in the future by imposing what damages besides regular damages?

Misrepresentation, unlike fraud, is not grounds for rescinding a contract.

You pay $200 for the right to be the only buyer a seller will deal with for ten days for a piece of property that is for sale for $250,000. This is:

____ occurs when someone is "forced" to sign a contract; that is, the contract is made because of a threat that gave no sensible way out.

An authoritative document that provides an orderly summary and presentation of the common law of contract is:

A transfer of contract rights to a third party is a delegation.

An offer may be revoked before the offeree has a chance to respond to it.

The primary purpose of a contract is to:

"I will pay you $100 to not sell your $500,000 house to anyone else for the next month so I can see if I can get the money together to buy it," you say. "Ok," says the home owner. The $100 payment is an option contract.

Ads are usually considered:

Generally, minors and intoxicated persons have only partial capacity to contract.

In DCS Sanitary Management v. Castillo, where a company had employees agree not to work for any competitors within 100 miles of any customer of DCS, the appeals court held that the agreement:

A ____ contract is one that is accepted by performance.

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