Question 1

Explain the notion of equality of bargaining power and its impact on the operation of contract law.

Accepted Answer

Equality of bargaining power is the lega

Question 2

Under which of the following circumstances would a court be likely to set a contract aside?

Accepted Answer

A)  if there is a lack of sufficient equality of the benefits received by each party 
B)  if there is an attempt to take advantage of a handicapped, vulnerable person 
C)  if there were witnesses to the contract 
D)  if the parties put their contract in writing 
A)  if there is a lack of sufficient equality of the benefits received by each party 
B)  if there is an attempt to take advantage of a handicapped, vulnerable person 
C)  if there were witnesses to the contract 
D)  if the parties put their contract in writing

Question 3

What test will a court apply when asked to determine a matter involving a dispute between parties regarding the formation of a contract?

Accepted Answer

A)  whether the contract is sufficiently complete to provide certainty to all parties 
B)  whether the terms of the contract provide sufficient mutual consideration 
C)  whether a reasonable person could conclude that an offer and acceptance occurred 
D)  whether the parties to the agreement have legal capacity to enter into contracts 
A)  whether the contract is sufficiently complete to provide certainty to all parties 
B)  whether the terms of the contract provide sufficient mutual consideration 
C)  whether a reasonable person could conclude that an offer and acceptance occurred 
D)  whether the parties to the agreement have legal capacity to enter into contracts

Question 4

The object of creating contractual obligations is to reduce the risk of uncertainty in the business relationship.

Accepted Answer

A) True 
 B)False

Question 5

A business should always insist on the strict observance and enforcement of its legal rights.

Accepted Answer

A) True 
 B)False

Question 6

Rachel decides to sell her home, so she meets with several real estate agents. One agent offers a reduced commission rate and a guarantee her home will sell within three months without a price reduction. Why should Rachel secure a formal contract if she chooses to use this agent?

Accepted Answer

A)  to ensure the arrangement meets the agent's needs and protects the agent's interests 
B)  to ensure the agent is motivated to avoid damaging his business reputation 
C)  to obtain favourable terms that provide for the no-fault cancellation of the contract 
D)  to allow Rachel to exercise her right to sue if the agent fails to perform as promised 
A)  to ensure the arrangement meets the agent's needs and protects the agent's interests 
B)  to ensure the agent is motivated to avoid damaging his business reputation 
C)  to obtain favourable terms that provide for the no-fault cancellation of the contract 
D)  to allow Rachel to exercise her right to sue if the agent fails to perform as promised

Question 7

Which of the following has the most influence on the negotiators' statements made during contractual negotiations?

Accepted Answer

A)  the business game is not subject to ethical standards 
B)  their communications form legal obligations 
C)  the concealment of facts 
D)  the compulsion to practice deception when negotiating 
A)  the business game is not subject to ethical standards 
B)  their communications form legal obligations 
C)  the concealment of facts 
D)  the compulsion to practice deception when negotiating

Question 8

Luna Quan has been directed to attend a meeting tomorrow for the purpose of negotiating a new supply contract. It is vitally important that Luna pay particular attention during those negotiations to when simple business communications transform into legal obligations.

Accepted Answer

A) True 
 B)False

Question 9

Identify and briefly describe the necessary elements that must be present in order for a court to recognize a contract as a legally binding agreement.

Accepted Answer

For a court to recognize a contract as a

Question 10

Most contractual business relationships are initiated through an offer and the acceptance of that offer. Acceptance is typically followed by communications to fill in the details of the arrangement.

Accepted Answer

A) True 
 B)False

Question 11

Why are contractual relationships usually preferable over casual forms of business arrangements?

Accepted Answer

A)  They envision business commitments or promises. 
B)  They solidly prove the parties' relationship is voluntary. 
C)  They readily provide the means for legal enforceability. 
D)  They must be expressed in writing using legal terminology. 
A)  They envision business commitments or promises. 
B)  They solidly prove the parties' relationship is voluntary. 
C)  They readily provide the means for legal enforceability. 
D)  They must be expressed in writing using legal terminology.

Question 12

What is the most important factor for a retailer to consider when deciding whether to file a lawsuit against a supplier for a breach of a business contract?

Accepted Answer

A)  the significance of the economic harm caused by the defaulting party's breach 
B)  the ability to secure an adequate supply of the stock from another supplier 
C)  the costs associated with obtaining the stock from a different supplier 
D)  the impact of the lawsuit on the reputation of the defaulting company 
A)  the significance of the economic harm caused by the defaulting party's breach 
B)  the ability to secure an adequate supply of the stock from another supplier 
C)  the costs associated with obtaining the stock from a different supplier 
D)  the impact of the lawsuit on the reputation of the defaulting company

Question 13

What is a valid reason for a court to accept that there is a legally binding contract governing the actions of the parties named to it?

Accepted Answer

A)  Under contract law, each party must get what it bargained for. 
B)  The parties are permitted to rely on the terms they negotiated. 
C)  Only the parties to a contract can sue or be sued on it. 
D)  The contract clearly contains an offer and acceptance of that offer. 
A)  Under contract law, each party must get what it bargained for. 
B)  The parties are permitted to rely on the terms they negotiated. 
C)  Only the parties to a contract can sue or be sued on it. 
D)  The contract clearly contains an offer and acceptance of that offer.

Question 14

What constitutes an economic breach of contract in a contractual business relationship?

Accepted Answer

A)  refusing to provide payment for services received in order to get a reduction in price 
B)  allowing existing legal obligations to keep the business from considering other opportunities 
C)  electing to refuse performance of contractual obligations and paying damages for the breach 
D)  electing to avoid damages by completing the performance of the contractual obligations 
A)  refusing to provide payment for services received in order to get a reduction in price 
B)  allowing existing legal obligations to keep the business from considering other opportunities 
C)  electing to refuse performance of contractual obligations and paying damages for the breach 
D)  electing to avoid damages by completing the performance of the contractual obligations

Question 15

In order for a court to be convinced that both parties deliberately entered into a contractual relationship, there must be evidence of their intention to create legal relations.

Accepted Answer

A) True 
 B)False

Question 16

In most instances, the rules governing contractual disputes are based on the common law.

Accepted Answer

A) True 
 B)False

Question 17

What sequence of procedures will a court follow when asked to determine a matter involving a contractual dispute between two large corporations?

Accepted Answer

A)  review the conduct of the parties, evaluate the relevant law and the contract terms, then reach a decision 
B)  evaluate the contract terms and the conduct of the parties, then apply relevant law to arrive at a determination 
C)  review the relevant law, evaluate the conduct of the parties, then apply the contract terms to arrive at a decision 
D)  evaluate the conduct of the parties, review the contract terms, then apply the rules of law to arrive at a decision 
A)  review the conduct of the parties, evaluate the relevant law and the contract terms, then reach a decision 
B)  evaluate the contract terms and the conduct of the parties, then apply relevant law to arrive at a determination 
C)  review the relevant law, evaluate the conduct of the parties, then apply the contract terms to arrive at a decision 
D)  evaluate the conduct of the parties, review the contract terms, then apply the rules of law to arrive at a decision

Question 18

A large greenhouse grower that wants to source a suitable organic liquid fertilizer contacts Organics. The grower is willing to pay a premium price for Organics's product. Accepting the order would mean Organics will not be able to completely fill existing orders to its current customers. Organics desires the new business but wants to maintain its existing customer base. Which of the following strategies should Organics use to solve this problem?

Accepted Answer

A)  Abandon all but the most important of the existing orders and fill the new order. 
B)  Present an ultimatum on existing orders offering delivery on a later date or nothing at all. 
C)  Comply with existing obligations, fill the orders, and offer the new business what is left. 
D)  Offer a price break on existing orders in return for varying quantity and delivery date. 
A)  Abandon all but the most important of the existing orders and fill the new order. 
B)  Present an ultimatum on existing orders offering delivery on a later date or nothing at all. 
C)  Comply with existing obligations, fill the orders, and offer the new business what is left. 
D)  Offer a price break on existing orders in return for varying quantity and delivery date.

Question 19

What is the likely outcome when a court is asked to resolve a dispute involving parties that have reached an incomplete agreement?

Accepted Answer

A)  The court will decline jurisdiction to provide a remedy derived under contract law. 
B)  The court will refer to statute law that will be applied to formulate a binding contract 
C)  The court will lack jurisdiction to refer the issue to alternative dispute resolution. 
D)  The court will apply the principles of the common law to constitute a binding contract. 
A)  The court will decline jurisdiction to provide a remedy derived under contract law. 
B)  The court will refer to statute law that will be applied to formulate a binding contract 
C)  The court will lack jurisdiction to refer the issue to alternative dispute resolution. 
D)  The court will apply the principles of the common law to constitute a binding contract.

Question 20

In order for a court to recognize a contract as a binding agreement between the contracting parties, there must be clear evidence of each party having given something of value in exchange for receiving something of value.

Accepted Answer

A) True 
 B)False

Exam 5: An Introduction to Contracts

Explain the notion of equality of bargaining power and its impact on the operation of contract law.

Under which of the following circumstances would a court be likely to set a contract aside?

What test will a court apply when asked to determine a matter involving a dispute between parties regarding the formation of a contract?

The object of creating contractual obligations is to reduce the risk of uncertainty in the business relationship.

A business should always insist on the strict observance and enforcement of its legal rights.

Rachel decides to sell her home, so she meets with several real estate agents. One agent offers a reduced commission rate and a guarantee her home will sell within three months without a price reduction. Why should Rachel secure a formal contract if she chooses to use this agent?

Which of the following has the most influence on the negotiators' statements made during contractual negotiations?

Luna Quan has been directed to attend a meeting tomorrow for the purpose of negotiating a new supply contract. It is vitally important that Luna pay particular attention during those negotiations to when simple business communications transform into legal obligations.

Identify and briefly describe the necessary elements that must be present in order for a court to recognize a contract as a legally binding agreement.

Most contractual business relationships are initiated through an offer and the acceptance of that offer. Acceptance is typically followed by communications to fill in the details of the arrangement.

Why are contractual relationships usually preferable over casual forms of business arrangements?

What is the most important factor for a retailer to consider when deciding whether to file a lawsuit against a supplier for a breach of a business contract?

What is a valid reason for a court to accept that there is a legally binding contract governing the actions of the parties named to it?

What constitutes an economic breach of contract in a contractual business relationship?

In order for a court to be convinced that both parties deliberately entered into a contractual relationship, there must be evidence of their intention to create legal relations.

In most instances, the rules governing contractual disputes are based on the common law.

What sequence of procedures will a court follow when asked to determine a matter involving a contractual dispute between two large corporations?

What is the likely outcome when a court is asked to resolve a dispute involving parties that have reached an incomplete agreement?

In order for a court to recognize a contract as a binding agreement between the contracting parties, there must be clear evidence of each party having given something of value in exchange for receiving something of value.

Knowledge of Law As a Business Asset

The Canadian Legal System

Managing Legal Risks

Dispute Resolution

Forming Contractual Relationships

The Terms of a Contract

Non Enforcement of Contracts

Termination and Enforcement of Contracts

Introduction to Tort Law

The Tort of Negligence

Other Torts

The Agency Relationship

Business Forms and Arrangements

The Corporate Form: Organizational Matters

The Corporate Form: Operational Matters

Personal Property

Intellectual Property

Real Property

The Employment Relationship

Terminating the Employment Relationship

Professional Services

Sales and Marketing: the Contract, Product, and Promotion

Sales and Marketing: Price, Distribution, and Risk Management

Business and Banking

The Legal Aspects of Credit

Bankruptcy and Insolvency

Insurance

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