Question 1

Impossibility,excusing performance of a contract,is measured objectively.

Accepted Answer

A) True 
 B)False

Question 2

A condition concurrent is one that requires the occurrence of an event before a party is obligated to perform a duty under the contract.

Accepted Answer

A) True 
 B)False

Question 3

An accord and satisfaction:

Accepted Answer

A)  usually arises in settlement of a dispute under the original contract 
B)  involves a third party in the contract 
C)  discharges the original contract's duties upon reaching the accord 
D)  can come into existence even if only one party wants it 
A)  usually arises in settlement of a dispute under the original contract 
B)  involves a third party in the contract 
C)  discharges the original contract's duties upon reaching the accord 
D)  can come into existence even if only one party wants it

Question 4

A "force majeure clause" sets damages in advance for failure to perform.

Accepted Answer

A) True 
 B)False

Question 5

Pete leases an apartment.The written lease agreement states that the lease is not assignable without consent of the landlord.Pete assigns his lease to his sister Paula,without the landlord's consent.In most states,which of the following is true?

Accepted Answer

A)  The assignment is invalid until the landlord consents,but the landlord must be reasonable in any decision to not consent. 
B)  Paula now "stands in the shoes" of her brother and has succeeded to Pete's rights to occupy the apartment. 
C)  Pete is no longer liable on the lease because he assigned it to Paula. 
D)  Non-assignability clauses are unenforceable as being contrary to public policy. 
A)  The assignment is invalid until the landlord consents,but the landlord must be reasonable in any decision to not consent. 
B)  Paula now "stands in the shoes" of her brother and has succeeded to Pete's rights to occupy the apartment. 
C)  Pete is no longer liable on the lease because he assigned it to Paula. 
D)  Non-assignability clauses are unenforceable as being contrary to public policy.

Question 6

The release of one party to a contract and the substitution of another party for the released party is called:

Accepted Answer

A)  a substitution by law 
B)  a summation 
C)  a novation 
D)  an adjudication 
E)  an accord and satisfaction 
A)  a substitution by law 
B)  a summation 
C)  a novation 
D)  an adjudication 
E)  an accord and satisfaction

Question 7

A donee beneficiary is someone who obtains rights under a contract without giving valuable consideration for those rights.

Accepted Answer

A) True 
 B)False

Question 8

Seller 1 contracts with Buyer to deliver 400 widgets.Seller 1 could fulfill this contract,but it assigns the benefits and delegates the duties of this contract to Seller 2,who accepts.If Seller 2 delivers the widgets that were contracted for,Buyer must accept and pay for them.

Accepted Answer

A) True 
 B)False

Question 9

An assignor is someone who subsequently gains rights under a preexisting contract.

Accepted Answer

A) True 
 B)False

Question 10

Buyer 1 and a seller agree on the sale of a new truck.Buyer 1 decides that she does not need the truck,but Buyer 2 agrees to purchase the truck.If Buyer 2 breaches this contract,which of the following statements is true,assuming this that is a novation?

Accepted Answer

A)  The seller may sue either Buyer 1 or Buyer 2,but may not collect from both. 
B)  The seller may sue only Buyer 1. 
C)  The seller may sue only Buyer 2. 
D)  The seller may sue either Buyer 1 or Buyer 2 and may collect from both of them. 
E)  Novations are unenforceable. 
A)  The seller may sue either Buyer 1 or Buyer 2,but may not collect from both. 
B)  The seller may sue only Buyer 1. 
C)  The seller may sue only Buyer 2. 
D)  The seller may sue either Buyer 1 or Buyer 2 and may collect from both of them. 
E)  Novations are unenforceable.

Question 11

Paragon Studios hires Harry Ford to play Indiana Bones in one of its new movies.Harry decides that he cannot fulfill this contract so he assigns his rights and delegates his duties under the contract to Tom Smellnik,another famous actor and friend of Harry.Which of the following best describes this situation?

Accepted Answer

A)  Paragon Studios must accept Smellnik,so long as he is an equally capable actor. 
B)  Paragon Studios must accept Smellnik whether he is a good actor or not. 
C)  Ford may not delegate his duty under this contract. 
D)  Smellnik must accept this job because it was assigned to him. 
E)  A and D are true. 
A)  Paragon Studios must accept Smellnik,so long as he is an equally capable actor. 
B)  Paragon Studios must accept Smellnik whether he is a good actor or not. 
C)  Ford may not delegate his duty under this contract. 
D)  Smellnik must accept this job because it was assigned to him. 
E)  A and D are true.

Question 12

Nor formalities are required for a valid assignment of rights.

Accepted Answer

A) True 
 B)False

Question 13

Mary signs a contract for an addition to her home that will extend the living room and add two bedrooms to the house.The contractor is responsible for all the design and construction,as well as all the redecorating of the living room and the decorating of the two bedrooms.The following provision is part of the contract: 
The parties agree that all the work in this contract must meet Mary's own personal satisfaction.In addition,the work must also meet the approval and satisfaction of Mary's brother,who is a builder and licensed contractor.
Mary's brother lives in another city and is not involved in the planning or construction of the addition,but has agreed with Mary to inspect the work at or near the time of completion.Mary has this work done while she is living in another country for a couple of months.Upon her return,the work is almost finished.She does not like the following aspects of the work: 
1.The roofing material on the addition does not match the material on the rest of the house.
2.She does not like the style of the new draperies,although they are high quality and of a current style.
3.She is displeased with some of the workmanship on the wood trim around the windows.She admits that she is a perfectionist about this and that most persons would be satisfied with it.
4.The concrete foundation under the addition was not as thick as she would like it.It is of standard thickness and would be satisfactory to most persons.
Her brother comes and inspects the addition.He notes three problems: 
1.The slope of the new part of the roof is not steep enough for the type of roofing materials used.They should have used something more appropriate for a nearly flat roof.
2.There should have been a bathroom included as part of the addition.The house originally had three bedrooms and one bathroom.Now there are five bedrooms and only one bathroom.Furthermore,the new bedrooms are located a long distance from the bathroom.
3.The windows are not of sufficient quality.
Mary wants to force the contractor to make all of these changes based on the personal satisfaction clause in the contract.Which of these,if any,can she force the contractor to change? Explain your reasoning with respect to each item.

Accepted Answer

The contractor would have to change the

Question 14

The duties in a personal service contract can always be delegated.

Accepted Answer

A) True 
 B)False

Question 15

Is it ever wise for persons such as an artist or interior decorator to enter into a contract that depends on the personal satisfaction of the other party? Why would someone enter into such a contract given the considerable risks? How could one of these persons minimize the risk if the other party demands a personal satisfaction clause?

Accepted Answer

Some parties will contract only if there

Question 16

The parties to a contract can include an "anti-delegation clause" if they so chose.

Accepted Answer

A) True 
 B)False

Question 17

Homeowner enters into an agreement with Grasscutter to cut the grass at Homeowner's house.The contract says nothing about delegation or assignment.Grasscutter gets a friend,Lawnmower to do the actual work.Which is true?

Accepted Answer

A)  This is a breach of the original contract because Grasscutter was the person hired. 
B)  This is an assignment by Grasscutter of his duty to cut the grass. 
C)  Because the contract does not mention assignment or delegation,Grasscutter cannot have someone else perform his duty. 
D)  Grasscutter can have Lawnmower do the work,but Grasscutter can be held responsible if Lawnmower does not do the work properly. 
A)  This is a breach of the original contract because Grasscutter was the person hired. 
B)  This is an assignment by Grasscutter of his duty to cut the grass. 
C)  Because the contract does not mention assignment or delegation,Grasscutter cannot have someone else perform his duty. 
D)  Grasscutter can have Lawnmower do the work,but Grasscutter can be held responsible if Lawnmower does not do the work properly.

Question 18

Under 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 
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

Question 19

John contracted to rent a condominium in the U.S.Virgin Islands for the month of September.In early August,the condominium was destroyed by a hurricane.The contract contained a clause that the parties' obligations would be discharged in the event of a natural disaster.In this situation,which of the following is true?

Accepted Answer

A)  The parties' obligations are not discharged because a hurricane is foreseeable in the Virgin Islands. 
B)  This is an enforceable force majeure clause that would discharge the parties. 
C)  This results in an accord and satisfaction under which alternate time in the condominium must be provided once is it reconstructed. 
D)  This is an example of the doctrine of commercial impracticability discharging the parties. 
E)  The force majeure clause renders the contract void because it makes the promises illusory. 
A)  The parties' obligations are not discharged because a hurricane is foreseeable in the Virgin Islands. 
B)  This is an enforceable force majeure clause that would discharge the parties. 
C)  This results in an accord and satisfaction under which alternate time in the condominium must be provided once is it reconstructed. 
D)  This is an example of the doctrine of commercial impracticability discharging the parties. 
E)  The force majeure clause renders the contract void because it makes the promises illusory.

Question 20

The state of an individual party being in a contract is known as privity of contract.

Accepted Answer

A) True 
 B)False

Exam 15: Third-Party Rights and Discharge

Impossibility,excusing performance of a contract,is measured objectively.

A condition concurrent is one that requires the occurrence of an event before a party is obligated to perform a duty under the contract.

An accord and satisfaction:

A "force majeure clause" sets damages in advance for failure to perform.

Pete leases an apartment.The written lease agreement states that the lease is not assignable without consent of the landlord.Pete assigns his lease to his sister Paula,without the landlord's consent.In most states,which of the following is true?

The release of one party to a contract and the substitution of another party for the released party is called:

A donee beneficiary is someone who obtains rights under a contract without giving valuable consideration for those rights.

Seller 1 contracts with Buyer to deliver 400 widgets.Seller 1 could fulfill this contract,but it assigns the benefits and delegates the duties of this contract to Seller 2,who accepts.If Seller 2 delivers the widgets that were contracted for,Buyer must accept and pay for them.

An assignor is someone who subsequently gains rights under a preexisting contract.

Buyer 1 and a seller agree on the sale of a new truck.Buyer 1 decides that she does not need the truck,but Buyer 2 agrees to purchase the truck.If Buyer 2 breaches this contract,which of the following statements is true,assuming this that is a novation?

Nor formalities are required for a valid assignment of rights.

The duties in a personal service contract can always be delegated.

The parties to a contract can include an "anti-delegation clause" if they so chose.

Homeowner enters into an agreement with Grasscutter to cut the grass at Homeowner's house.The contract says nothing about delegation or assignment.Grasscutter gets a friend,Lawnmower to do the actual work.Which is true?

Under a mutual rescission,the parties to a contract:

The state of an individual party being in a contract is known as privity of contract.

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