Question 1

Only contracts involving significant sums of money must be in writing to be enforceable.

Accepted Answer

A) True 
 B)False

Question 2

Joe was unable to find work in the city where he lived and had to go to the mining camps up north to find work. When he left, he agreed to send his wife $500 a month from his pay for the support of her and the children. In fact, he had some unexpected expenses and failed to send the promised funds for two months. Which of the following correctly states the legal position of the parties?

Accepted Answer

A)  Because of the marital obligation, there is always an enforceable contract in these circumstances. 
B)  Since this is a domestic relationship, there is a presumption that there is no contract. 
C)  Since this is a domestic relationship, there is a presumption that there is a contract. 
D)  The court will make no presumptions in these circumstances because there is never a contract between husband and wife. 
E)  The court will enforce the promise only if they determine it to be reasonable. 
A)  Because of the marital obligation, there is always an enforceable contract in these circumstances. 
B)  Since this is a domestic relationship, there is a presumption that there is no contract. 
C)  Since this is a domestic relationship, there is a presumption that there is a contract. 
D)  The court will make no presumptions in these circumstances because there is never a contract between husband and wife. 
E)  The court will enforce the promise only if they determine it to be reasonable.

Question 3

Even in commercial relationships, if the parties make it absolutely clear that they don't intend the arrangement to be legally binding on them, the agreement will not be enforceable in court.

Accepted Answer

A) True 
 B)False

Question 4

Joe saw an ad in a paper for the sale of a house in a residential area of Victoria. He approached Sam, the owner, and after some negotiation Sam orally agreed to sell the house to Joe for $50,000. Joe gave Sam $10,000 cash as a partial payment, the rest to be given upon transfer of the house. Two days later, Sam changed his mind and sent Joe a letter referring to the deal and stating that he would not honour the agreement. Which of the following is correct with respect to the legal position of the parties? Assume all the facts can be proved.

Accepted Answer

A)  If the letter mentions the important terms (such as price) and identifies the specific property, Sam must go through with the contract. 
B)  Sam will not be bound because no oral agreement is ever enforceable. 
C)  Even if the letter gives evidence of the deal in writing, it cannot satisfy the requirement of writing. It is the whole contract that must be in writing. 
D)  Sam is not bound by the agreement as the contract was not in writing. 
E)  The contract is void unless it has been partially performed. 
A)  If the letter mentions the important terms (such as price) and identifies the specific property, Sam must go through with the contract. 
B)  Sam will not be bound because no oral agreement is ever enforceable. 
C)  Even if the letter gives evidence of the deal in writing, it cannot satisfy the requirement of writing. It is the whole contract that must be in writing. 
D)  Sam is not bound by the agreement as the contract was not in writing. 
E)  The contract is void unless it has been partially performed.

Question 5

If a person says that he had not intended to be bound by an agreement when he entered it, there can be no contract.

Accepted Answer

A) True 
 B)False

Question 6

What is the term for a written commitment whereby a person agrees to pay a debt if the debtor does not?

Accepted Answer

The answer of What is the term for a written...

Question 7

All contracts must be written to be binding.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following types of contracts would not be considered illegal?

Accepted Answer

A)  Contracts that promote litigation 
B)  Contracts that obstruct justice 
C)  Contracts that reasonably restraint trade 
D)  Contracts to commit a tort 
E)  Contracts preventing someone from marrying
TRUE/FALSE. Write 'T' if the statement is true and 'F' if the statement is false. 
A)  Contracts that promote litigation 
B)  Contracts that obstruct justice 
C)  Contracts that reasonably restraint trade 
D)  Contracts to commit a tort 
E)  Contracts preventing someone from marrying
TRUE/FALSE. Write 'T' if the statement is true and 'F' if the statement is false.

Question 9

A woman forged her husband's signature on dozens of cheques. In an attempt to protect her from prosecution, the husband signed a letter prepared by the Bank agreeing to assume all liability for the forged cheques. What would the Court find in relation to this agreement?

Accepted Answer

A)  As an agreement to stifle a criminal prosecution, it was an illegal contract and therefore void. 
B)  The agreement was unenforceable because the Bank lacked capacity to enter into such an agreement. 
C)  Because the husband acted improperly, the agreement was voidable by the Bank on the basis of illegality. 
D)  While the Bank acted improperly, "freedom to contract" establishes that the agreement must be enforced. 
E)  The agreement was unenforceable because the husband was under duress at the time he signed it. 
A)  As an agreement to stifle a criminal prosecution, it was an illegal contract and therefore void. 
B)  The agreement was unenforceable because the Bank lacked capacity to enter into such an agreement. 
C)  Because the husband acted improperly, the agreement was voidable by the Bank on the basis of illegality. 
D)  While the Bank acted improperly, "freedom to contract" establishes that the agreement must be enforced. 
E)  The agreement was unenforceable because the husband was under duress at the time he signed it.

Question 10

What must a person establish in order to escape contractual obligations on the basis on insanity?

Accepted Answer

That he was insane at the time of the co

Question 11

Contracts may be in writing, under seal, verbal, or even implied.

Accepted Answer

A) True 
 B)False

Question 12

What is the term used when a person cannot understand the nature or consequences of his or her actions?

Accepted Answer

The answer of What is the term used when a...

Question 13

Which of the following statements is correct with respect to the legality of contracts?

Accepted Answer

A)  An agreement where one party agrees to pay another to sue a third for tort is legally enforceable. 
B)  A judge can refuse to enforce a contract that involves conduct that is not prohibited by law but which the court considers morally unacceptable. 
C)  When two merchants agree not to sell a certain product below an agreed price and the product is not readily available from others sources, this is legally permissible as long as they intend their promises to be legally binding. 
D)  Insurance taken out on property you don't own is valid as long as the insurance company has been informed that you have no interest in the property. 
E)  An agreement that one merchant won't open up a business in competition with another is enforceable as long as there is consideration on both sides. 
A)  An agreement where one party agrees to pay another to sue a third for tort is legally enforceable. 
B)  A judge can refuse to enforce a contract that involves conduct that is not prohibited by law but which the court considers morally unacceptable. 
C)  When two merchants agree not to sell a certain product below an agreed price and the product is not readily available from others sources, this is legally permissible as long as they intend their promises to be legally binding. 
D)  Insurance taken out on property you don't own is valid as long as the insurance company has been informed that you have no interest in the property. 
E)  An agreement that one merchant won't open up a business in competition with another is enforceable as long as there is consideration on both sides.

Question 14

The nature of the legislation governing incorporation in each jurisdiction determines whether a corporation has its capacity to contract limited or not.

Accepted Answer

A) True 
 B)False

Question 15

Kashif agreed to sell his acreage to his coworker, Melinda, for $400,000. Because the two worked together, they did not see the need to put the agreement in writing. Nonetheless, Kashif sent Melinda a note that referred to the essential terms of their agreement, to which Melinda replied acknowledging their deal. Without any other writing, can this contract be enforced? Explain.

Accepted Answer

Yes. To satisfy the Statute of

Question 16

Neither party is bound by a contract with an infant.

Accepted Answer

A) True 
 B)False

Question 17

All contracts must be in writing to be enforceable.

Accepted Answer

A) True 
 B)False

Question 18

All contracts that have the effect of restricting competition are void.

Accepted Answer

A) True 
 B)False

Question 19

Joe sold Harry his barbershop, but Harry wanted a commitment on Joe's part that he would not open up another barbershop in the area after he got the money. Explain how the parties could include a clause in their agreement, to that end, without it being void as a restraint of trade.

Accepted Answer

As long as the provision goes no farther

Question 20

Mr. Buyer, the plaintiff in the action, was attempting to enforce a contract in which the defendant, Mr. Seller agreed to sell to buyer his property, Blackacre, for $100,000. Which of the following, by itself, would be sufficient to allow Mr. Seller to get out of the contract?

Accepted Answer

A)  Mr. Buyer referred to essential terms in a letter sent to Mr. Seller. 
B)  There was only a verbal agreement between Mr. Seller and Mr. Buyer. 
C)  The $100,000 was not enough, not fair. 
D)  At the time of the contract, unknown to Mr. Buyer, Mr. Seller did not understand the quality and nature of this act because of mental incapacity. 
E)  Although both parties agreed to this, there had not actually been any money paid on the contract, not even a deposit or a down payment. 
A)  Mr. Buyer referred to essential terms in a letter sent to Mr. Seller. 
B)  There was only a verbal agreement between Mr. Seller and Mr. Buyer. 
C)  The $100,000 was not enough, not fair. 
D)  At the time of the contract, unknown to Mr. Buyer, Mr. Seller did not understand the quality and nature of this act because of mental incapacity. 
E)  Although both parties agreed to this, there had not actually been any money paid on the contract, not even a deposit or a down payment.

Only contracts involving significant sums of money must be in writing to be enforceable.

Even in commercial relationships, if the parties make it absolutely clear that they don't intend the arrangement to be legally binding on them, the agreement will not be enforceable in court.

If a person says that he had not intended to be bound by an agreement when he entered it, there can be no contract.

What is the term for a written commitment whereby a person agrees to pay a debt if the debtor does not?

All contracts must be written to be binding.

Which of the following types of contracts would not be considered illegal?

A woman forged her husband's signature on dozens of cheques. In an attempt to protect her from prosecution, the husband signed a letter prepared by the Bank agreeing to assume all liability for the forged cheques. What would the Court find in relation to this agreement?

What must a person establish in order to escape contractual obligations on the basis on insanity?

Contracts may be in writing, under seal, verbal, or even implied.

What is the term used when a person cannot understand the nature or consequences of his or her actions?

Which of the following statements is correct with respect to the legality of contracts?

The nature of the legislation governing incorporation in each jurisdiction determines whether a corporation has its capacity to contract limited or not.

Neither party is bound by a contract with an infant.

All contracts must be in writing to be enforceable.

All contracts that have the effect of restricting competition are void.

Joe sold Harry his barbershop, but Harry wanted a commitment on Joe's part that he would not open up another barbershop in the area after he got the money. Explain how the parties could include a clause in their agreement, to that end, without it being void as a restraint of trade.

Mr. Buyer, the plaintiff in the action, was attempting to enforce a contract in which the defendant, Mr. Seller agreed to sell to buyer his property, Blackacre, for $100,000. Which of the following, by itself, would be sufficient to allow Mr. Seller to get out of the contract?

Managing Your Legal Affairs

Introduction to the Legal System

The Resolution of Disputes the Courts and Alternatives to Litigation

Intentional Torts

Negligence, Professional Liability, and Insurance Law

Formation of Contracts

Factors Affecting the Contractual Relationship

The End of the Contractual Relationship

Employment

Agency and Partnership

Corporations

Real, Personal and Intellectual Property

Information Technology and the Internet

Sales and Consumer Protection

Priority of Creditors

Filters

Exam 7: Formation of Contracts Continued

Only contracts involving significant sums of money must be in writing to be enforceable.

Even in commercial relationships, if the parties make it absolutely clear that they don't intend the arrangement to be legally binding on them, the agreement will not be enforceable in court.

If a person says that he had not intended to be bound by an agreement when he entered it, there can be no contract.

What is the term for a written commitment whereby a person agrees to pay a debt if the debtor does not?

All contracts must be written to be binding.

Which of the following types of contracts would not be considered illegal?

A woman forged her husband's signature on dozens of cheques. In an attempt to protect her from prosecution, the husband signed a letter prepared by the Bank agreeing to assume all liability for the forged cheques. What would the Court find in relation to this agreement?

What must a person establish in order to escape contractual obligations on the basis on insanity?

Contracts may be in writing, under seal, verbal, or even implied.

What is the term used when a person cannot understand the nature or consequences of his or her actions?

Which of the following statements is correct with respect to the legality of contracts?

The nature of the legislation governing incorporation in each jurisdiction determines whether a corporation has its capacity to contract limited or not.

Neither party is bound by a contract with an infant.

All contracts must be in writing to be enforceable.

All contracts that have the effect of restricting competition are void.

Joe sold Harry his barbershop, but Harry wanted a commitment on Joe's part that he would not open up another barbershop in the area after he got the money. Explain how the parties could include a clause in their agreement, to that end, without it being void as a restraint of trade.

Mr. Buyer, the plaintiff in the action, was attempting to enforce a contract in which the defendant, Mr. Seller agreed to sell to buyer his property, Blackacre, for $100,000. Which of the following, by itself, would be sufficient to allow Mr. Seller to get out of the contract?

Managing Your Legal Affairs

Introduction to the Legal System

The Resolution of Disputes the Courts and Alternatives to Litigation

Intentional Torts

Negligence, Professional Liability, and Insurance Law

Formation of Contracts

Factors Affecting the Contractual Relationship

The End of the Contractual Relationship

Employment

Agency and Partnership

Corporations

Real, Personal and Intellectual Property

Information Technology and the Internet

Sales and Consumer Protection

Priority of Creditors

Filters