Exam 6: Formation of Contracts

What is a "gratuitous promise"?

Bob in Burnaby called Ed in Toronto and offered to sell him 40 kilograms of smoked salmon at $15 per kilogram. He requested that Ed phone him back by noon the next day. That way, Bob could offer it to someone else if Ed wasn't interested. Instead of phoning, Ed sent a letter of acceptance, in which he said that he would have his agent pick up the fish. On these facts, which of the following is false?

Joe was a contractor and hired subtrades to help build his houses. Sam was a framer and had agreed to frame four houses for Joe for a set price. Joe was to supply the materials. After two houses were completed, Joe's suppliers increased the cost of lumber, and Joe told Sam that he could no longer pay him the amount that they'd agreed. Sam agreed to take 15% less for the other two jobs, which were then completed. During this time, regular payments were made from Joe to Sam, but the total amount received was 15% lower than the originally agreed on price for the last two jobs. Sam sued Joe for the original contract price, claiming that he'd received no consideration for his agreement to take less for the last two jobs. Explain what defences may be available to Joe under these circumstances and his likelihood of success. ESSAY. Write your answer in the space provided or on a separate sheet of paper.

If an offeror makes an offer that states, "This offer to be open until noon tomorrow," which of the following does not, in law, end the offer?

A formal contract is one that is signed and sealed.

Discuss the requirement of consideration and its role and value in the formation of contracts. In your answer, make sure to deal with the issue of fairness in the bargaining process.

When Mr. Adams tells the local Boys' and Girls' Club that he will give them $5,000 if they promise to use the funds for their summer camping program, this is an example of which one of the following?

The postbox rule applies when which of the following means of communication is used?

Ann was offered a job that would pay $20,000, that would provide for 18 days vacation after one year of employment, and that would begin one week after her graduation. She wrote back that she would accept the job, but that she would not begin until three weeks after graduation and needed at least a 21-day vacation after the first year of work. On these facts, which of the following is true?

If the postbox rule applies, a letter of revocation takes effect at the time of mailing.

Harry saw Joe in his classic Buick at a local drive-in restaurant, and told Joe that he'd like to buy it. He offered him $1,500. Joe said he had to think about it and that he'd let Harry know. Two days later, Joe decided that he needed the money and couldn't afford to keep the car. He wrote Harry a letter accepting his offer and mailed it that afternoon. The next day, Harry phoned telling Joe he'd changed his mind and that he needed the money for something else. Joe told him about the letter, and in fact Harry received the letter that day after the telephone conversation in which he attempted to revoke the offer. Joe insisted on going through with the deal. Explain the legal liability of the parties.

What did the Court decide in Entores Ltd. v. Miles Far East Corp.?

Franz bought a round trip ticket to Germany to visit relatives. Unfortunately, a week before flight time, he broke his leg. He offered his co-worker, Joe, the ticket for 80% of the full price, offer to remain open until 10:00 p.m. on December 15. Indicate to Joe which of the following is true with regard to the law of offer and acceptance.

An ad in the morning newspaper read "Absolutely the best offer anywhere in Calgary. We'll give you an IBM-compatible PC with a Roland PR-1011 printer for only $1,000!!! Pick it up today." This is an example of which of the following?

The owner of a large restaurant wanted four large pots of flowers in front of the restaurant. Laura, a landscaper, submitted her offer: four large pots with flowers for $800. The owner said he would pay $600 for that. Laura said, "For $600, I'll provide four smaller pots with flowers." The owner said, "$600 for the smaller pots with flowers plus an arrangement for the front desk." Laura said, "Forget it," and started to leave. The owner said, "All right, I'll accept your offer of $600 for the four smaller pots with flowers." Laura didn't answer; she just got into her truck and drove off. On these facts, which of following is true?

The promise of "love and affection" can constitute adequate consideration to support a contract.

When is an offer incapable of being revoked?

What is a "subject-to clause"?

"One of the basic precepts in contract law is that any bargain struck must be fair to be enforceable." Explain the accuracy of that statement.

What would be the result if a police officer arrived at the scene of crime in progress and demanded money from the victim to arrest the offender?