Question 1

The parol evidence rule:

Accepted Answer

A) applies to complete written contracts. 
B) prevents proof of fraud. 
C) applies to incomplete contracts. 
D) is not designed to preserve the integrity of written contracts. 
A) applies to complete written contracts. 
B) prevents proof of fraud. 
C) applies to incomplete contracts. 
D) is not designed to preserve the integrity of written contracts.

Question 2

The writing required by the statute of frauds in the case of a contract for the sale of land must:

Accepted Answer

A) be addressed to the other party to the contract. 
B) be made with the intent to create a writing to satisfy the statute of frauds. 
C) be signed at the end of the writing. 
D) describe the land to be sold. 
A) be addressed to the other party to the contract. 
B) be made with the intent to create a writing to satisfy the statute of frauds. 
C) be signed at the end of the writing. 
D) describe the land to be sold.

Question 3

As a rule of contractual construction and interpretation, ordinary words are to be interpreted according to their ordinary meaning; accordingly, an unambiguous contract will be interpreted as it is written, not on the basis of the secret intent of one party.

Accepted Answer

A) True 
 B)False

Question 4

A promise to pay a debt must be in writing if:

Accepted Answer

A) the debt is for more than $500. 
B) the debt is now due and payable. 
C) the promise is to pay the debt of another. 
D) the debt owed is the promisor's. 
A) the debt is for more than $500. 
B) the debt is now due and payable. 
C) the promise is to pay the debt of another. 
D) the debt owed is the promisor's.

Question 5

A father's oral promise to his daughter and her fiancée made in consideration of their contemplated marriage is binding when made in the course of a serious discussion.

Accepted Answer

A) True 
 B)False

Question 6

Provisions of a contract will be considered separately and not as a whole.

Accepted Answer

A) True 
 B)False

Question 7

Bart was a self-made millionaire who had earned his fortune by dedicated hard work. Bart had worked so hard that he never had developed much of a social life. Bart met Linda and fell in love with her. When Bart proposed to Linda, she told him that she needed time before making such an important decision. Pressing her for a favorable response, Bart telephoned Linda and promised her $100,000 if she would marry him. Linda then accepted the proposal.
Bart contracted with Quick Builders for the construction of a home Bart intended to move into with Linda after their marriage. Construction by Quick was not very quick because Quick was not paying subcontractors the sums that they were owed. They, in turn, were not completing their work. To expedite matters, Bart called the subcontractors and assured them that Bart would pay any sums that Quick Builders did not pay if they would complete the construction.
Bart and Linda married and the subcontractors completed the work. Quick Builders did not pay the subcontractors in full. Bart failed to pay Linda the $100,000. Both Linda and the subcontractors sued Bart. Discuss the probable outcome of the lawsuits.

Accepted Answer

Linda's lawsuit will be unsuccessful bec

Question 8

In the absence of a statute requiring a writing, a contract may be oral or written.

Accepted Answer

A) True 
 B)False

Question 9

An oral understanding is not binding if:

Accepted Answer

A) the services performed were not to the satisfaction of the other party. 
B) the amount agreed to be paid for services rendered was not a fair and reasonable amount. 
C) the parties intended to formalize their understanding with a written agreement. 
D) the understanding may be terminated at will by either party. 
A) the services performed were not to the satisfaction of the other party. 
B) the amount agreed to be paid for services rendered was not a fair and reasonable amount. 
C) the parties intended to formalize their understanding with a written agreement. 
D) the understanding may be terminated at will by either party.

Question 10

When a contract may be terminated at will by either party, the statute of frauds is not applicable because the contract may be terminated within one year.

Accepted Answer

A) True 
 B)False

Question 11

When the main purpose of the promisor's promise to pay the debt of another is to benefit the promisor, the statute of frauds is not applicable, and the oral promise to pay the debt is binding.

Accepted Answer

A) True 
 B)False

Question 12

The statute of frauds applies to:

Accepted Answer

A) a contract of indefinite duration that is terminable at will by either party. 
B) a promise made directly to a debtor that the promisor will pay the creditor of the debtor what is owed. 
C) a promise by an executor to pay a claim against the estate out of his or her personal funds. 
D) mutual promises to marry. 
A) a contract of indefinite duration that is terminable at will by either party. 
B) a promise made directly to a debtor that the promisor will pay the creditor of the debtor what is owed. 
C) a promise by an executor to pay a claim against the estate out of his or her personal funds. 
D) mutual promises to marry.

Question 13

When an insurance policy is ambiguous, the policy is interpreted:

Accepted Answer

A) against the insurer. 
B) in favor of the insurer. 
C) according to the dictionary meaning of the words. 
D) according to the meaning of the words in the insurance industry. 
A) against the insurer. 
B) in favor of the insurer. 
C) according to the dictionary meaning of the words. 
D) according to the meaning of the words in the insurance industry.

Question 14

The standard statute of frauds:

Accepted Answer

A) requires full disclosure in the case of consumer sales on credit. 
B) requires a seller of real estate to obtain a broker's license. 
C) specifies the punishment of perjury. 
D) requires that a contract for the sale of land be evidenced by a writing. 
A) requires full disclosure in the case of consumer sales on credit. 
B) requires a seller of real estate to obtain a broker's license. 
C) specifies the punishment of perjury. 
D) requires that a contract for the sale of land be evidenced by a writing.

Question 15

When the statute of frauds applies and there is no written proof of the contract, the contract is:

Accepted Answer

A) void. 
B) enforceable if there are two credible witnesses. 
C) voidable by a party who has not signed. 
D) illegal. 
A) void. 
B) enforceable if there are two credible witnesses. 
C) voidable by a party who has not signed. 
D) illegal.

Question 16

An oral contract containing a promise by an executor to pay estate debts from estate funds is:

Accepted Answer

A) binding. 
B) voidable by the executor or administrator. 
C) enforceable against the executor only if the executor signs written proof of the agreement. 
D) enforceable against the other contracting party only if that party signs a written agreement. 
A) binding. 
B) voidable by the executor or administrator. 
C) enforceable against the executor only if the executor signs written proof of the agreement. 
D) enforceable against the other contracting party only if that party signs a written agreement.

Question 17

The parol evidence rule does not apply to changes made after the signing of the contract.

Accepted Answer

A) True 
 B)False

Question 18

Under the statute of frauds, an oral contract must be completed within one year after performance begins.

Accepted Answer

A) True 
 B)False

Question 19

When a person has performed services under an oral contract that cannot be enforced because of the statute of frauds, such person:

Accepted Answer

A) can recover the agreed payment for the services because a refusal to make payment would be a breach of the contract. 
B) can recover the reasonable value of the services because there is a quasi-contractual duty to pay for the benefit received from such services. 
C) cannot recover the value of the services because they were rendered under a unilateral mistake of law. 
D) can have the party receiving the services arrested for obtaining property by false pretenses. 
A) can recover the agreed payment for the services because a refusal to make payment would be a breach of the contract. 
B) can recover the reasonable value of the services because there is a quasi-contractual duty to pay for the benefit received from such services. 
C) cannot recover the value of the services because they were rendered under a unilateral mistake of law. 
D) can have the party receiving the services arrested for obtaining property by false pretenses.

Exam 17: Writing, Electronic Forms, and Interpretation of Contracts

The parol evidence rule:

The writing required by the statute of frauds in the case of a contract for the sale of land must:

As a rule of contractual construction and interpretation, ordinary words are to be interpreted according to their ordinary meaning; accordingly, an unambiguous contract will be interpreted as it is written, not on the basis of the secret intent of one party.

A promise to pay a debt must be in writing if:

A father's oral promise to his daughter and her fiancée made in consideration of their contemplated marriage is binding when made in the course of a serious discussion.

Provisions of a contract will be considered separately and not as a whole.

In the absence of a statute requiring a writing, a contract may be oral or written.

An oral understanding is not binding if:

When a contract may be terminated at will by either party, the statute of frauds is not applicable because the contract may be terminated within one year.

When the main purpose of the promisor's promise to pay the debt of another is to benefit the promisor, the statute of frauds is not applicable, and the oral promise to pay the debt is binding.

The statute of frauds applies to:

When an insurance policy is ambiguous, the policy is interpreted:

The standard statute of frauds:

When the statute of frauds applies and there is no written proof of the contract, the contract is:

An oral contract containing a promise by an executor to pay estate debts from estate funds is:

The parol evidence rule does not apply to changes made after the signing of the contract.

Under the statute of frauds, an oral contract must be completed within one year after performance begins.

When a person has performed services under an oral contract that cannot be enforced because of the statute of frauds, such person:

The Nature and Sources of Law

The Court System and Dispute Resolution

Business Ethics, Social Forces, and the Law

The Constitution As the Foundation of the Legal Environment

Government Regulation of Competition and Prices

Administrative Agencies

The Legal Environment of International Trade

Crimes

Torts

Intellectual Property Rights

Cyberlaw

Nature and Classes of Contracts: Contracting on the Internet

Formation of Contracts: Offer and Acceptance

Capacity and Genuine Assent

Consideration

Legality and Public Policy

Third Persons and Contracts

Discharge of Contracts

Breach of Contract and Remedies

Personal Property and Bailments

Legal Aspects of Supply Chain Management

Nature and Form of Sales

Title and Risk of Loss

Product Liability: Warranties and Torts

Obligations and Performance

Remedies for Breach of Sales Contracts

Kinds of Instruments, Parties, and Negotiability

Transfers of Negotiable Instruments and Warranties of Parties

Liability of the Parties Under Negotiable Instruments

Checks and Funds Transfers

Nature of the Debtor-Creditor Relationship

Consumer Protection

Secured Transactions in Personal Property

Bankruptcy

Insurance

Agency

Third Persons in Agency

Regulation of Employment

Equal Employment Opportunity Law

Types of Business Organizations

Partnerships

LPS, LlCS, and LlPS

Corporate Formation

Shareholder Rights in Corporations

Securities Regulation

Accountants Liability and Malpractice

Management of Corporations

Real Property

Environmental Law and Land Use Controls

Leases

Decedents Estates and Trusts

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