Question 1

In general, if a contract is illegal, a court will not enforce it.

Accepted Answer

A) True 
 B)False  True

Question 2

All states require that members of certain professions to have licenses.

Accepted Answer

A) True 
 B)False  True

Question 3

If a minor disaffirms a contract, he or she must disaffirm the entire contract.

Accepted Answer

A) True 
 B)False  True

Question 4

Duffy and Elbert agree to hijack a truck carrying a load of pecans. If Duffy later refuses to go through with the crime, Elbert can

Accepted Answer

A)  enforce the agreement. 
B)  obtain damages from Duffy in the amount of Duffy's probable share of the illegal profits. 
C)  recover in quasi contract for the loss of his share of the illegal profits. 
D)  do nothing. 
A)  enforce the agreement. 
B)  obtain damages from Duffy in the amount of Duffy's probable share of the illegal profits. 
C)  recover in quasi contract for the loss of his share of the illegal profits. 
D)  do nothing.

Question 5

A covenant not to compete is never enforceable.

Accepted Answer

A) True 
 B)False

Question 6

Mariah promises to pay her assistant Nadine $10,000 in consideration of the services she provided over the years. Mariah never pays Nadine. Mariah is

Accepted Answer

A)  liable for payment of the $10,000. 
B)  liable only if Nadine still works for Mariah. 
C)  not liable, because the consideration is in the past. 
D)  not liable, because the consideration was unintentional. 
A)  liable for payment of the $10,000. 
B)  liable only if Nadine still works for Mariah. 
C)  not liable, because the consideration is in the past. 
D)  not liable, because the consideration was unintentional.

Question 7

Odina signs a covenant not to compete with her employer, Penultimate Sales Corporation. A court decides that the covenant is overly restrictive. The court will likely

Accepted Answer

A)  enforce it as written so as not to undercut the freedom of contract. 
B)  enforce it but evaluate its effects over time. 
C)  reform its terms to prevent any undue burden. 
D)  refuse to enforce it unless Penultimate pays additional consideration. 
A)  enforce it as written so as not to undercut the freedom of contract. 
B)  enforce it but evaluate its effects over time. 
C)  reform its terms to prevent any undue burden. 
D)  refuse to enforce it unless Penultimate pays additional consideration.

Question 8

Rollo promises to perform, for a price, shoe repair services in affiliation with Togs 'n Things, a clothing store. To support a contract, the consideration exchanged by the parties must be

Accepted Answer

A)  adequately considerate. 
B)  equally valuable. 
C)  legally sufficient. 
D)  wisely priced. 
A)  adequately considerate. 
B)  equally valuable. 
C)  legally sufficient. 
D)  wisely priced.

Question 9

When a minor disaffirms a contract, he or she cannot keep whatever he or she has received as a result of the contract without paying for it.

Accepted Answer

A) True 
 B)False

Question 10

A preexisting duty may arise from a previous contract.

Accepted Answer

A) True 
 B)False

Question 11

The state of Illinois enacts a usury statute. The purpose is to

Accepted Answer

A)  establish a maximum rate of interest that may be charged for loans. 
B)  establish a minimum rate of interest that may be charged for loans. 
C)  prevent the misuse of money advanced as loans. 
D)  prevent the misuse of money paid back on loans. 
A)  establish a maximum rate of interest that may be charged for loans. 
B)  establish a minimum rate of interest that may be charged for loans. 
C)  prevent the misuse of money advanced as loans. 
D)  prevent the misuse of money paid back on loans.

Question 12

If a contract is fully performed by all parties to it, then it is presumed to have been ratified.

Accepted Answer

A) True 
 B)False

Question 13

Chris, a minor, signs a contract to purchase alcoholic beverages for Dine & Drink, his parents' restaurant. The contract is

Accepted Answer

A)  valid but may be disaffirmed. 
B)  valid but may not be disaffirmed. 
C)  void as a matter of law. 
D)  void unless it is also signed by Edie, the manager of Dine & Drink. 
A)  valid but may be disaffirmed. 
B)  valid but may not be disaffirmed. 
C)  void as a matter of law. 
D)  void unless it is also signed by Edie, the manager of Dine & Drink.

Question 14

Fact Pattern 11-1 
Sally contracts with Tasty Pizza Company to deliver its products. Both parties change their minds, however, and inform each other that they would like to cancel the contract.

-Refer to Fact Pattern 11-1. Sally and Tasty

Accepted Answer

A)  may rescind their entire contract. 
B)  may rescind their contract to the extent that it is executory. 
C)  must perform their entire contract. 
D)  must perform the part of their contract that is executory. 
A)  may rescind their entire contract. 
B)  may rescind their contract to the extent that it is executory. 
C)  must perform their entire contract. 
D)  must perform the part of their contract that is executory.

Question 15

Some states impose a duty on a minor who disaffirms a contract to restore the adult party to the position he or she held before the contract was made.

Accepted Answer

A) True 
 B)False

Question 16

Jolie signs a contract with Keaton, an unlicensed physician, to perform a medical procedure. This contract is enforceable by

Accepted Answer

A)  Jolie. 
B)  Jolie's medical insurance company. 
C)  Keaton. 
D)  no one. 
A)  Jolie. 
B)  Jolie's medical insurance company. 
C)  Keaton. 
D)  no one.

Question 17

Rolf is an emergency medical technician. Medical personnel such as Rolf are prohibited by state statute from working more than a certain number of consecutive hours. One month, Rolf works more than the legal limit. Rolf can recover for

Accepted Answer

A)  the hours up to the statutory maximum but not more. 
B)  the hours up to the statutory maximum and the extra hours. 
C)  the hours up to the statutory maximum or the extra hours. 
D)  nothing. 
A)  the hours up to the statutory maximum but not more. 
B)  the hours up to the statutory maximum and the extra hours. 
C)  the hours up to the statutory maximum or the extra hours. 
D)  nothing.

Question 18

Past consideration can be legally sufficient consideration.

Accepted Answer

A) True 
 B)False

Question 19

Colleen is intoxicated, but still mentally capable of understanding the consequences of her actions when she signs a contract to sell the rights to her latest phone app design to Addie. The contract is

Accepted Answer

A)  enforceable only if Colleen does not attempt to disaffirm it. 
B)  enforceable even if Colleen attempts to disaffirm it. 
C)  unenforceable if Addie attempts to disaffirm it. 
D)  enforceable only if Addie does not attempt to disaffirm it. 
A)  enforceable only if Colleen does not attempt to disaffirm it. 
B)  enforceable even if Colleen attempts to disaffirm it. 
C)  unenforceable if Addie attempts to disaffirm it. 
D)  enforceable only if Addie does not attempt to disaffirm it.

Question 20

Adequacy of consideration refers to how much consideration is given.

Accepted Answer

A) True 
 B)False

Exam 11: Consideration, Capacity, and Legality

In general, if a contract is illegal, a court will not enforce it.

All states require that members of certain professions to have licenses.

If a minor disaffirms a contract, he or she must disaffirm the entire contract.

Duffy and Elbert agree to hijack a truck carrying a load of pecans. If Duffy later refuses to go through with the crime, Elbert can

A covenant not to compete is never enforceable.

Mariah promises to pay her assistant Nadine $10,000 in consideration of the services she provided over the years. Mariah never pays Nadine. Mariah is

Odina signs a covenant not to compete with her employer, Penultimate Sales Corporation. A court decides that the covenant is overly restrictive. The court will likely

Rollo promises to perform, for a price, shoe repair services in affiliation with Togs 'n Things, a clothing store. To support a contract, the consideration exchanged by the parties must be

When a minor disaffirms a contract, he or she cannot keep whatever he or she has received as a result of the contract without paying for it.

A preexisting duty may arise from a previous contract.

The state of Illinois enacts a usury statute. The purpose is to

If a contract is fully performed by all parties to it, then it is presumed to have been ratified.

Chris, a minor, signs a contract to purchase alcoholic beverages for Dine & Drink, his parents' restaurant. The contract is

Fact Pattern 11-1 Sally contracts with Tasty Pizza Company to deliver its products. Both parties change their minds, however, and inform each other that they would like to cancel the contract. -Refer to Fact Pattern 11-1. Sally and Tasty

Some states impose a duty on a minor who disaffirms a contract to restore the adult party to the position he or she held before the contract was made.

Jolie signs a contract with Keaton, an unlicensed physician, to perform a medical procedure. This contract is enforceable by

Rolf is an emergency medical technician. Medical personnel such as Rolf are prohibited by state statute from working more than a certain number of consecutive hours. One month, Rolf works more than the legal limit. Rolf can recover for

Past consideration can be legally sufficient consideration.

Colleen is intoxicated, but still mentally capable of understanding the consequences of her actions when she signs a contract to sell the rights to her latest phone app design to Addie. The contract is

Adequacy of consideration refers to how much consideration is given.

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