Question 1

A collateral contract involves:

Accepted Answer

A)  three parties and two promises, one of which is conditional. 
B)  two parties and two promises, both of which are conditional. 
C)  two parties and three promises, one of which is conditional. 
D)  three parties and two promises, both of which are conditional. 
A)  three parties and two promises, one of which is conditional. 
B)  two parties and two promises, both of which are conditional. 
C)  two parties and three promises, one of which is conditional. 
D)  three parties and two promises, both of which are conditional.

Question 2

When a contract is partly printed and partly written, _____.

Accepted Answer

A)  the written terms control the printed terms if the two conflict 
B)  ambiguities are resolved in favor of the party who drafted the contract 
C)  the printed terms control the written terms 
D)  any presence of ambiguities renders the contract void and unenforceable 
A)  the written terms control the printed terms if the two conflict 
B)  ambiguities are resolved in favor of the party who drafted the contract 
C)  the printed terms control the written terms 
D)  any presence of ambiguities renders the contract void and unenforceable

Question 3

Explain the purpose of the parol evidence rule.

Accepted Answer

The basic idea behind the parol evidence

Question 4

Which of the following is true of the parol evidence rule?

Accepted Answer

A)  If the writing in a contract is clearly incomplete, a party can introduce proof of consistent oral terms that "fill the gaps" in the writing. 
B)  If the written terms of a contract are unclear, the party can use this exception to alter the concerned part of the contract. 
C)  Oral testimony that attempts to show that a contract is illegal is not allowed. 
D)  Proof of contradicting oral agreements that were made after the writing was created is illegal and not enforceable. 
A)  If the writing in a contract is clearly incomplete, a party can introduce proof of consistent oral terms that "fill the gaps" in the writing. 
B)  If the written terms of a contract are unclear, the party can use this exception to alter the concerned part of the contract. 
C)  Oral testimony that attempts to show that a contract is illegal is not allowed. 
D)  Proof of contradicting oral agreements that were made after the writing was created is illegal and not enforceable.

Question 5

When parties to an oral contract have both fully performed their obligations under the contract, the parties are:

Accepted Answer

A)  allowed to rescind the contract. 
B)  not allowed to rescind the contract. 
C)  allowed to seek compensatory damages. 
D)  not allowed to recover the value of the performance in quasi contract. 
A)  allowed to rescind the contract. 
B)  not allowed to rescind the contract. 
C)  allowed to seek compensatory damages. 
D)  not allowed to recover the value of the performance in quasi contract.

Question 6

The equitable doctrine of _____ allows some parties to recover under oral contracts that the statute of frauds would have ordinarily rendered unenforceable.

Accepted Answer

A)  estoppel by representation of fact 
B)  estoppel by record 
C)  proprietary estoppel 
D)  promissory estoppel 
A)  estoppel by representation of fact 
B)  estoppel by record 
C)  proprietary estoppel 
D)  promissory estoppel

Question 7

According to most states, which of the following is true if there is only a memorandum of two parties' agreement?

Accepted Answer

A)  The writing can be in any form but must indicate that the parties had a contract. 
B)  The entire contract must be in writing and in a single document. 
C)  The writing cannot be in the form of telegrams or receipts. 
D)  Both parties' signatures have to appear in the writing. 
A)  The writing can be in any form but must indicate that the parties had a contract. 
B)  The entire contract must be in writing and in a single document. 
C)  The writing cannot be in the form of telegrams or receipts. 
D)  Both parties' signatures have to appear in the writing.

Question 8

Contracts that are traditionally required to be in writing by the statute of frauds are:

Accepted Answer

A)  bilateral contracts that are capable of being performed within a year of their formation. 
B)  contracts for the transfer of an interest in land. 
C)  bilateral contracts that have been fully performed by both parties. 
D)  contracts for the sale of goods costing less than $500. 
A)  bilateral contracts that are capable of being performed within a year of their formation. 
B)  contracts for the transfer of an interest in land. 
C)  bilateral contracts that have been fully performed by both parties. 
D)  contracts for the sale of goods costing less than $500.

Question 9

Many states require contracts to pay debts barred by a bankruptcy discharge or the statute of limitations to be evidenced by a writing.

Accepted Answer

A) True 
 B)False

Question 10

According to the Uniform Commercial Code (UCC), _____.

Accepted Answer

A)  the sale of goods between two parties is always legal 
B)  the doctrine of promissory estoppel will always overrule a written contract 
C)  the sale of goods costing $500 or more is not enforceable without a writing or other specified evidence 
D)  there is no need for the formality of writing during sales transactions 
A)  the sale of goods between two parties is always legal 
B)  the doctrine of promissory estoppel will always overrule a written contract 
C)  the sale of goods costing $500 or more is not enforceable without a writing or other specified evidence 
D)  there is no need for the formality of writing during sales transactions

Question 11

Which of the following is a recognized exception to the parole evidence rule?

Accepted Answer

A)  Clear contracts 
B)  Complete writings 
C)  Voluntary consent 
D)  Subsequent oral contracts 
A)  Clear contracts 
B)  Complete writings 
C)  Voluntary consent 
D)  Subsequent oral contracts

Question 12

Long-term bilateral contracts need not be in writing to be enforceable, since contracts that call for performance over a considerable period of time are more important to the contracting parties, and the terms of such contracts are therefore more likely to be recalled by them.

Accepted Answer

A) True 
 B)False

Question 13

Many states require contracts to pay a commission on the sale of real estate to be evidenced by a writing.

Accepted Answer

A) True 
 B)False

Question 14

Although the statutes of frauds of all the states are not the same, most states require only a memorandum of the parties' agreement; they do not require that the entire contract be in writing or that the writing be in a single document.

Accepted Answer

A) True 
 B)False

Question 15

Under the Electronic Signatures in Global and National Commerce Act (E-Sign), _____.

Accepted Answer

A)  there are no specific rules that businesses must follow when seeking consumer consent to electronic contracts 
B)  the price and procedures for withdrawing consent must be spelled out to the customer 
C)  e-businesses are permitted to impose consent withdrawal fees on consumers in all situations 
D)  a digital signature does not have the same effect as one written in ink on paper 
A)  there are no specific rules that businesses must follow when seeking consumer consent to electronic contracts 
B)  the price and procedures for withdrawing consent must be spelled out to the customer 
C)  e-businesses are permitted to impose consent withdrawal fees on consumers in all situations 
D)  a digital signature does not have the same effect as one written in ink on paper

Question 16

Under the parol evidence rule, parties cannot vary the terms of a(n):

Accepted Answer

A)  written contract by introducing evidence of terms allegedly agreed on prior to, or contemporaneous with the writing. 
B)  oral contract by introducing evidence of a written agreement. 
C)  written contract by introducing evidence of another writing signed after the original contract was drafted. 
D)  oral agreement by publishing notice of a subsequent modification. 
A)  written contract by introducing evidence of terms allegedly agreed on prior to, or contemporaneous with the writing. 
B)  oral contract by introducing evidence of a written agreement. 
C)  written contract by introducing evidence of another writing signed after the original contract was drafted. 
D)  oral agreement by publishing notice of a subsequent modification.

Question 17

On March 10, Martin entered into an oral contract with Wilson. Under the oral contract, they agreed that Wilson will work for Martin for two years for a salary of $50,000 per year. Wilson quit his job the next day so that he could join Martin. But on March 12, Martin called Wilson and repudiated the contract, stating that he had decided not to hire him after all. If Wilson decides to sue, which of the following is most likely to be true?

Accepted Answer

A)  Wilson may use the doctrine of promissory estoppel to show that he had materially relied on the oral promise and will suffer serious losses if the promise is not enforced. 
B)  Wilson cannot sue Martin because there was no written contract. 
C)  Oral contracts are completely voidable and have no weight in the court. 
D)  Wilson can sue Martin for false imprisonment and unintentional tort because Wilson did not have a written contract, and this becomes the best alternate course of action. 
A)  Wilson may use the doctrine of promissory estoppel to show that he had materially relied on the oral promise and will suffer serious losses if the promise is not enforced. 
B)  Wilson cannot sue Martin because there was no written contract. 
C)  Oral contracts are completely voidable and have no weight in the court. 
D)  Wilson can sue Martin for false imprisonment and unintentional tort because Wilson did not have a written contract, and this becomes the best alternate course of action.

Question 18

The Uniform Commercial Code (UCC) states that contracts for the sale of goods costing $500 or more are not enforceable without being evidenced by writing or other specified evidence.

Accepted Answer

A) True 
 B)False

Question 19

Explain what a collateral (guaranty) contract is.

Accepted Answer

There are many common situations in whic

Question 20

If the parties used a form contract, or the contract is partly printed and partly written, the printed terms control the written terms if the two conflict.

Accepted Answer

A) True 
 B)False

Exam 16: The Form and Meaning of Contracts

A collateral contract involves:

When a contract is partly printed and partly written, _____.

Explain the purpose of the parol evidence rule.

Which of the following is true of the parol evidence rule?

When parties to an oral contract have both fully performed their obligations under the contract, the parties are:

The equitable doctrine of _____ allows some parties to recover under oral contracts that the statute of frauds would have ordinarily rendered unenforceable.

According to most states, which of the following is true if there is only a memorandum of two parties' agreement?

Contracts that are traditionally required to be in writing by the statute of frauds are:

Many states require contracts to pay debts barred by a bankruptcy discharge or the statute of limitations to be evidenced by a writing.

According to the Uniform Commercial Code (UCC), _____.

Which of the following is a recognized exception to the parole evidence rule?

Long-term bilateral contracts need not be in writing to be enforceable, since contracts that call for performance over a considerable period of time are more important to the contracting parties, and the terms of such contracts are therefore more likely to be recalled by them.

Many states require contracts to pay a commission on the sale of real estate to be evidenced by a writing.

Although the statutes of frauds of all the states are not the same, most states require only a memorandum of the parties' agreement; they do not require that the entire contract be in writing or that the writing be in a single document.

Under the Electronic Signatures in Global and National Commerce Act (E-Sign), _____.

Under the parol evidence rule, parties cannot vary the terms of a(n):

The Uniform Commercial Code (UCC) states that contracts for the sale of goods costing $500 or more are not enforceable without being evidenced by writing or other specified evidence.

Explain what a collateral (guaranty) contract is.

If the parties used a form contract, or the contract is partly printed and partly written, the printed terms control the written terms if the two conflict.

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