Question 1

In a mutual rescission,the parties to a contract:

Accepted Answer

A)  agree to new terms. 
B)  involve a third party in the contract. 
C)  agree to undo and cancel a contract. 
D)  agree to perform a contract a second time under the same terms as the original. 
E)  agree to a set amount as damages. 
A)  agree to new terms. 
B)  involve a third party in the contract. 
C)  agree to undo and cancel a contract. 
D)  agree to perform a contract a second time under the same terms as the original. 
E)  agree to a set amount as damages.

Question 2

An equitable condition is one that can be implied from the circumstances surrounding a contract and the parties' conduct.

Accepted Answer

A) True 
 B)False

Question 3

Impossibility of performance occurs if the contract becomes subjectively impossible to perform by one of the parties.

Accepted Answer

A) True 
 B)False

Question 4

Which of the following statements is correct regarding the assignment of a future right?

Accepted Answer

A)  Usually, a person can assign a future right. 
B)  Usually, a person can assign a future right in equity. 
C)  Usually, a person can conditionally assign a future right. 
D)  Usually, a person can conditionally assign a future right to goods, but not a future right to services. 
E)  Usually, a person cannot assign a future right. 
A)  Usually, a person can assign a future right. 
B)  Usually, a person can assign a future right in equity. 
C)  Usually, a person can conditionally assign a future right. 
D)  Usually, a person can conditionally assign a future right to goods, but not a future right to services. 
E)  Usually, a person cannot assign a future right.

Question 5

Contracts for the provision of personal services are generally not assignable without the permission of the obligor.

Accepted Answer

A) True 
 B)False

Question 6

With an assignment of rights,an obligee generally becomes an assignor when the right is assigned.

Accepted Answer

A) True 
 B)False

Question 7

Once an assignment is made,it is the duty of the assignor to notify the obligor so the obligor can deliver proper performance.

Accepted Answer

A) True 
 B)False

Question 8

What was the court decision in Accrued Financial Services,Incorporated v.Prime Retail,Incorporated,in which a corporation that conducted lease audits was assigned the right by tenants to recover 40% to 50% of any overcharges collected?

Accepted Answer

A)  The tenants' assignment of their legal causes of action violated public policy, and was therefore illegal and void. 
B)  The tenants' had the right to assign their legal causes of action, and the assignments were valid. 
C)  The tenants' only had the right to assign their legal causes of action if overcharges amounted to more than $1,000; otherwise, public policy was violated. 
D)  The tenants could not assign their legal causes of action because of anti-assignment provisions in the leases. 
E)  The tenants could assign their legal causes of action only because fraud on the part of the lessors had been shown. 
A)  The tenants' assignment of their legal causes of action violated public policy, and was therefore illegal and void. 
B)  The tenants' had the right to assign their legal causes of action, and the assignments were valid. 
C)  The tenants' only had the right to assign their legal causes of action if overcharges amounted to more than $1,000; otherwise, public policy was violated. 
D)  The tenants could not assign their legal causes of action because of anti-assignment provisions in the leases. 
E)  The tenants could assign their legal causes of action only because fraud on the part of the lessors had been shown.

Question 9

Commercial impracticability allows discharge of a contract only if it is actually impossible to perform.

Accepted Answer

A) True 
 B)False

Question 10

The two general categories of third-party beneficiaries to a contract are:

Accepted Answer

A)  delegated and assigned. 
B)  declared and assumed. 
C)  incidental and intended. 
D)  original and assumed. 
E)  precedent and subsequent. 
A)  delegated and assigned. 
B)  declared and assumed. 
C)  incidental and intended. 
D)  original and assumed. 
E)  precedent and subsequent.

Question 11

A contract that makes performance "satisfaction guaranteed or your money back" bases performance on a concurrent condition.

Accepted Answer

A) True 
 B)False

Question 12

Recurrent conditions arise when the parties to a contract agree to render performance simultaneously.

Accepted Answer

A) True 
 B)False

Question 13

The unconditional assignment of a contract extinguishes all of the assignor's rights,including the right to sue the obligor directly for nonperformance.

Accepted Answer

A) True 
 B)False

Question 14

Commercial impracticability excuses performance if an unforeseeable event makes it impractical for the promisor to perform.

Accepted Answer

A) True 
 B)False

Question 15

What is the tangible token rule?

Accepted Answer

A)  a rule that prevents the assignment of contract rights unless there is a tangible token of proof that the right was assigned 
B)  a rule that provides that when the same contract right has been assigned to more than one assignee, the right belongs to the person in possession of the tangible token of the assignment 
C)  a rule that requires the assignee of a contract right to give some tangible token of consideration in exchange for being assigned the contract right 
D)  a rule that requires the assignor of a contract right to retain some tangible token of the right assigned 
E)  a rule that prevents the assignment of contract rights unless a tangible token in the form of a monetary deposit has been provided 
A)  a rule that prevents the assignment of contract rights unless there is a tangible token of proof that the right was assigned 
B)  a rule that provides that when the same contract right has been assigned to more than one assignee, the right belongs to the person in possession of the tangible token of the assignment 
C)  a rule that requires the assignee of a contract right to give some tangible token of consideration in exchange for being assigned the contract right 
D)  a rule that requires the assignor of a contract right to retain some tangible token of the right assigned 
E)  a rule that prevents the assignment of contract rights unless a tangible token in the form of a monetary deposit has been provided

Question 16

A minority of states follow the "New York rule" of successive assignments.

Accepted Answer

A) True 
 B)False

Question 17

A party who is owed an obligation of performance is called an:

Accepted Answer

A)  obligor. 
B)  obligee. 
C)  assignor. 
D)  assignee. 
E)  offeree 
A)  obligor. 
B)  obligee. 
C)  assignor. 
D)  assignee. 
E)  offeree

Question 18

In an assignment of contract rights,the assignee takes no better rights under the contract that the assignor had.

Accepted Answer

A) True 
 B)False

Question 19

A contract can be assigned even if the assignment would materially alter the risk or duties of the obligor.

Accepted Answer

A) True 
 B)False

Question 20

An anti-assignment clause may be used if the obligor does not want to deal with or render performance to an unknown third party.

Accepted Answer

A) True 
 B)False

Exam 13: Third-Party Rights and Discharge

In a mutual rescission,the parties to a contract:

An equitable condition is one that can be implied from the circumstances surrounding a contract and the parties' conduct.

Impossibility of performance occurs if the contract becomes subjectively impossible to perform by one of the parties.

Which of the following statements is correct regarding the assignment of a future right?

Contracts for the provision of personal services are generally not assignable without the permission of the obligor.

With an assignment of rights,an obligee generally becomes an assignor when the right is assigned.

Once an assignment is made,it is the duty of the assignor to notify the obligor so the obligor can deliver proper performance.

What was the court decision in Accrued Financial Services,Incorporated v.Prime Retail,Incorporated,in which a corporation that conducted lease audits was assigned the right by tenants to recover 40% to 50% of any overcharges collected?

Commercial impracticability allows discharge of a contract only if it is actually impossible to perform.

The two general categories of third-party beneficiaries to a contract are:

A contract that makes performance "satisfaction guaranteed or your money back" bases performance on a concurrent condition.

Recurrent conditions arise when the parties to a contract agree to render performance simultaneously.

The unconditional assignment of a contract extinguishes all of the assignor's rights,including the right to sue the obligor directly for nonperformance.

Commercial impracticability excuses performance if an unforeseeable event makes it impractical for the promisor to perform.

What is the tangible token rule?

A minority of states follow the "New York rule" of successive assignments.

A party who is owed an obligation of performance is called an:

In an assignment of contract rights,the assignee takes no better rights under the contract that the assignor had.

A contract can be assigned even if the assignment would materially alter the risk or duties of the obligor.

An anti-assignment clause may be used if the obligor does not want to deal with or render performance to an unknown third party.

Legal Heritage and the Information Age

Constitutional Law for Business and E-Commerce

Courts and Jurisdiction

Judicial, Alternative, Administrative, and E-Dispute Resolution

Torts and Strict Liability

Criminal Law and Cyber Crimes

Intellectual Property and Cyber Piracy

Ethics and Social Responsibility of Business

Nature of Traditional and E-Contracts

Agreement and Consideration

Capacity and Legality

Genuineness of Assent and Statute of Frauds

Breach of Contract and Remedies

Digital Law and E-Commerce

Formation of Sales, Lease, and E-Contracts

Performance of Sales, Leases and E-Contracts

Remedies for Breach of Sales and Lease Contracts

Warranties and Product Liability

Creation and Transfer of Negotiable Instruments

Holder in Due Course and Liability of Parties

Banking System, E-Money, and Financial Reform

Credit and Secured Transactions

Bankruptcy and Reorganization

Agency Law

Small Business, Entrepreneurship, and Partnerships

Corporate Formation and Financing

Corporate Governance and Sarbanes-Oxley Act

Corporate Acquisitions and Multinational Corporations

Limited Liability Company and Limited Liability Partnership

Franchise and Special Forms of Business

Investor Protection,E-Securities Transactions,and Wall Street Reform

Antitrust Law

Consumer Safety, Consumer Financial Protection, and Environmental Protection

Labor, Worker Protection, Employment, and Immigration Law

Equal Opportunity in Employment

Personal Property, Bailment, and Insurance

Real Property, Landlord-Tenant Law, and Land Use Regulation

Family Law, Wills, and Trusts

Accountants' Liability

International and World Trade Law

Filters