Exam 8: Factors Affecting the Contractual Relationship

Al sells gravel to Bob on credit, and Bob sells it to Chuck, an innocent purchaser. Then Bob runs away with the money, without paying Al. Who will get the gravel if the court holds that the contract between Al and Bob was "void"?

Allen hired Beth to do a marketing survey. The contract provided that she would start the work on January 15 and finish it by March 15, the date for completion being a condition on the contract. She would be paid $2,000. After one month of work, when the work was half completed, Beth assigned the $2,000 contract price to Charlie, from whom she had bought computer hardware. Charlie gave written notice of the assignment to Allen on the same day. The second month's work went badly. Information entered into the computer was lost and Beth could not finish on time. She was five days late, and each day cost Allen $100. His total foreseeable loss was $500 because of her breach. On these facts, which of the following is true?

Explain what remedies are available to the victim where misrepresentation becomes a term of the contract.

According to Braut v. Stec, what is the Courts' position when one enters into a contract where a claim is made that a bargain is unconscionable?

In Dansway International Transport Ltd. v. Lesway and Sons Inc., a disagreement arose as to the time for payment and delivery, neither of which were stipulated in the contract. What did the Court do?

"Misrepresentation involves a misleading statement of fact, not opinion." Discuss the accuracy of that statement.

The longer Adolph stayed on this job, the more he hated it. He thought the boss was too demanding. He especially disliked being reprimanded for being late. One afternoon, he was asked by a secretary to take a letter to the boss for his signature. The boss had had an eye operation and was recuperating at home. Adolph got two signatures, one on the letter and one on a note promising to pay Adolph $1,000 in consideration for services rendered. The boss was not careless, but couldn't read the papers. What plea or argument, if any, could the boss use to avoid paying on the promissory note?

A real-estate agent, Jones, was owed a $7,000 commission, having sold property for Mr. Quick. Mr. Quick couldn't be found, but Jones did find his wife and learned that she had over $20,000 in treasury bills. Mr. Jones told her that if she didn't assign to him $7,000 of the $20,000, he would make sure her husband was imprisoned for his debts and "for other crimes" he knew about. If she did make an assignment in writing to Jones of the $7,000 but later tried to void the agreement, she would argue which of the following?

When Gary went into Computer Heaven, Ltd. to get a better manual for the program he was trying to master, he was caught by a demonstration of a computer created by Next, Mr. Job's new firm. He was fascinated by its performance. The salesman, Ross, told Gary that he should have this machine; that "it was the last computer, no other will ever be better"; that "UBC, Simon Fraser, and BCIT just ordered over 1000 of them"; that he only had "a few left and the demand is so great it will take almost a year for the next shipment to arrive." When Gary said he needed a computer with at least 100 Gigabytes, Ross said this model had 250 Gigabytes. Gary was persuaded and contracted for it. Later Gary learned that every statement made by the salesman Ross was untrue, including the statement about the memory capacity; the model only had 40 Gigabytes. On these facts, which of the following is true?

When two parties are involved in a mutual mistake (misunderstanding) as to the meaning of a term of the contract, which of the following is usually applied by the court to settle the matter?

With regard to the law concerning misrepresentation, which of the following is true?

With regard to the law governing privity of contract and assignment, which of the following is false?

"Where fraudulent misrepresentation is involved, the victim can obtain rescission and/or damages but where innocent misrepresentation is involved, the only remedy is damages." Discuss the accuracy of that statement.

With regard to the law concerning misrepresentation, which of the following is true?

A computer salesman innocently misrepresented a fact about a Macintosh computer to a customer. Although this fact was not about a term of the contract, it did induce the customer to buy the computer. The customer has now learned the true facts and wants to return the computer. If the store refused to take it back, the customer would ask the court for which equitable remedy?

Mary has a little scam most everywhere she goes; she sells by saying anything. Her buyers just have woes. Which of the following is true with regard to misrepresentation?

Often a party to a contract wants to avoid his obligations by arguing that the contract was entered into because of a mistake, misrepresentation, undue influence, or duress. Which of the following is true with regard to these areas of the law?

The principle that courts will not permit outside evidence to contradict clear wording of a contract is known as ________.

Explain what is meant by a "collateral contract".

For a contract to be unconscionable, it is necessary that the victim was particularly vulnerable and that the bargain was unfair.