Exam 11: Consideration, capacity, and Legality

Fact Pattern 11-1 Dave's Hobby Town and Eva's Yarn Shoppe are adjacent stores with adjoining parking lots. Dave offers Eva a discount on purchases from Dave's store if Eva will not tow the cars of Dave's customers who park in Eva's lot. -Refer to Fact Pattern 11-1.Eva's forbearance from towing is legally sufficient consideration

Eli obtains a consumer loan from First State Bank at an interest rate that exceeds the state's maximum.First State has

Fay is mentally incompetent but has not been so adjudged by a court.Any contract Fay enters into is

A severable contract is unenforceable as a violation of public policy.

Boyd is a minor.As a minor,Boyd has the capacity to enter into

Cherry and Basil are minors who marry each other.Their minority status may be terminated under the laws of

Contractual capacity refers to the legal ability to enter into a contract.

Quality Steel Corporation files a suit against Rite Tool Company,claiming that the consideration for their contract is inadequate.The court will most likely not examine the adequacy of the consideration if

Mica,a minor,signs a contract to pay Natural Health Club a monthly fee for twenty-four months to use its facilities.Six months later,after reaching the age of majority,Mica continues to use the club.This act is

Ken relinquishes the right to his son Lee's control,care,custody,and earnings.This act is

Intoxicated but fully aware of the consequences,Uri agrees to a two-year cell-phone service contract with Wander Talk,Inc.,at more than the average market price.This contract is

U-Can-Own-It Corporation sells appliances to less educated consumers,including Vi,on installment plans.U-Can-Own-It files a suit against Vi when she stops making payments.Vi claims that the deal is unconscionable.The court will most likely consider

A contract between Donald and Chloe to lease commercial property contains an exculpatory clause.This clause is

A minor may disaffirm a contract only if the subject matter is illegal.

Intoxicated,Clio agrees to sell her restaurant,Diners Café,to Evan for half of its real market value.This deal is most likely void if

Neil represents himself as a contractor in Ohio,but he is not licensed in that state.A contract between Pam and Neil by which Neil agrees to build a warehouse for Pam in Ohio is

Fact Pattern 11-3 (Questions 10-11 apply) Dex and Carmen are in an auto accident. Dex offers Carmen $2,000 if she promises not to pursue her potential legal claim against Dex. Carmen agrees. Later, Carmen discovers that it will cost $1,500 to repair her car and $4,000 to cover the medical expenses for a latent injury. -Refer to Fact Pattern 11-3.In Carmen's suit against Dex to recover her repair and medical expenses,Carmen will most likely recover

Boz runs an illegal gambling business and pays Colin,a police officer,not to interfere.The payments are discovered.Boz and Colin are sent to prison.With respect to the amount of the payments,Boz can recover

Normally,a court of law will not question the adequacy of consideration.

Jock and Kim decide to wager in violation of a state statute on the outcome of a football game.They each deposit money with Iverson,who agrees to pay the winner of the bet.Before the game begins,Kim tells Iverson that she changed her mind about the bet.Kim can recover