Deck 12: Nature and Classes of Contracts: Contracting on the Internet

Question 1

A reward offered to the public for the return of lost property is not considered an offer.

Answer 1

False

Question 2

A recognizance is an agreement by which one party admits or recognizes that a specified sum of money is owed to another party.

Answer 2

False

Question 3

Because transfer of value is essential to a valid contract, contracts cannot arise in the performance of personal services.

Answer 3

False

Question 4

An executed contract is an agreement that has been completely performed.

Question 5

An agreement that contemplates the performance of an act prohibited by law is usually void.

Question 6

Quasi contracts are contracts.

Question 7

An implied contract is one in which the agreement is shown not by words, written or spoken, but by the acts and conduct of the parties.

Question 8

A person who makes a promise is the promisor, while a person to whom the promise is made is the promisee.

Question 9

An offeror makes an offer to an offeree.

Question 10

A contract is essentially an agreement that creates an obligation.

Question 11

A void contract is one that is otherwise valid but may be rejected or set aside by one of the parties.

Question 12

The effect of an implied contract is not the same as the effect of an express contract.

Question 13

A contract of record arises when the accountant of one of the parties has made an entry of the contract in the business record of that party.

Question 14

Only the parties who signed the original contract can have rights with respect to that contract.

Question 15

Negotiable instruments are examples of formal contracts.

Question 16

An express contract is one in which the agreement is shown by the acts and conduct of the parties.

Question 17

A contract for an amount greater than $1 million must be made under seal or it is not binding.

Question 18

An offer may be made only to a specific person.

Question 19

An executory contract is an agreement by which something remains to be done by one or both parties.

Question 20

A contract can only involve two parties.

Question 21

A contract of record is also referred to as a:

A)recognizance.
B)reconnaissance.
C)recording contract.
D)none of the above.

Question 22

When a contract is fully performed by one party, it is called a unilateral contract.

Question 23

An option contract gives one of the parties an absolute right to enter into a second contract at a later date.

Question 24

An agreement arises when one person, the __________, makes an offer and the other person to whom the offer is made, the __________, accepts.

A)grantor; grantee
B)grantee; grantor
C)offeror; offeree
D)offeree; offeror

Question 25

Whenever a person receives a benefit for which payment has not been made, there is an unjust enrichment and the value of such benefit must be paid to the person conferring the benefit.

Question 26

A contract requires:

A)an offer.
B)an acceptance.
C)both an offer and an acceptance.
D)an agreement manifested by the written or spoken words of the parties.

Question 27

A contract never can be both executory and unilateral.

Question 28

The elements of a contract include all of the following except:

A)an agreement.
B)two or more competent parties.
C)consideration.
D)an illegal purpose.

Question 29

The principle behind the quasi contract is to prevent unjust enrichment.

Question 30

A contract is:

A)a binding agreement.
B)an agreement creating an obligation.
C)an agreement that creates enforceable duties and obligations.
D)all of the above.

Question 31

An implied contract is shown by:

A)a writing.
B)the acts and conduct of the parties.
C)statements made in open court.
D)an exchange of oral promises.

Question 32

The subject matter of a contract may relate to:

A)the performance of personal services.
B)the construction of a house.
C)the transfer of ownership of property.
D)all of the above.

Question 33

Negotiable instruments are:

A)formal contracts.
B)informal contracts.
C)option contracts.
D)first-refusal agreements.

Question 34

With regard to a unilateral contract, the offeree does not accept the offer by express agreement, but rather by performance.

Question 35

Quasi-contractual liability will generally be imposed when the cost of performing a contract is greater than had been expected.

Question 36

A quasi contract may arise in a situation in which no contract exists.

Question 37

The promisor in a contract may also be called the:

A)obligor.
B)grantor
C)obligee
D)grantee

Question 38

When a contract sets a price for services rendered, a plaintiff cannot sue for reasonable value.

Question 39

A bilateral contract is essentially an exchange of promises.

Question 40

A party to a contract may be:

A)an individual.
B)a partnership.
C)a corporation.
D)all of the above.

Question 41

An executory contract is:

A)void if neither party has performed.
B)voidable.
C)entered into but not fully performed.
D)always unilateral in nature.

Question 42

An obligation to pay for the reasonable value of services rendered when there is no contract would be called:

A)quasi-contractual.
B)quasi-enforceable.
C)semi-lawful.
D)valid.

Question 43

A right of __________ refusal is the right of a party to meet the terms of a proposed contract before it is executed, such as a real estate purchase agreement.

A)concomitant
B)conditional
C)formal
D)first

Question 44

The Martin family owned a home that was badly in need of repair. Mrs. Martin worked outside the home and Mr. Martin took care of the household responsibilities and cared for the two young Martin children. One day, Mrs. Martin left for work and a home repair crew drove up and began to put aluminum siding on the Martin house. Mr. Martin telephoned his wife, told her, and inquired about whether she had hired the workers. When the Martins realized that they never had ordered this work done, Mr. Martin sneaked out the back with the children. He later met his wife at work and they returned home for dinner. By that time, the entire front of the house had been aluminum-sided. The foreman asked, "Mr. and Mrs. Wolf, how do you like the job?" The Martins replied that they loved the job, but the Wolfs lived next door. When it became clear that the repair crew had made an error, the foreman insisted that the Martins had to pay.
a.Decide the case, and explain the reason(s) for your decision.
b.Decide the case, assuming that the Martins were away on vacation when the improvements were made, and then returned home to discover the improvements.

Question 45

When Gordon told Hanson that he was considering selling his house, Hanson offered to buy it. Gordon and Hanson entered into a contract in which Hanson paid Gordon $1,000 in cash for the right to buy Gordon's house for $150,000 in the event Gordon decided to sell it. Two weeks later, Jones offered Gordon $200,000 for his house, and Gordon agreed to sell it to her for that amount. Hanson sued Gordon to force Gordon to sell the house to him for $150,000, rather than to Jones for $200,000. Identify the probable result of the action. What type of contract, if any, was entered into between Gordon and Hanson?

Question 46

A legally binding agreement that can be rejected at the option of one of the parties is called a(n):

A)void agreement.
B)revoked contract.
C)voidable contract.
D)optional agreement.

Question 47

The plaintiff in a quasi-contractual action can recover:

A)lost profits.
B)damages for mental distress.
C)the reasonable value of the benefit conferred upon the defendant.
D)for all the damages sustained.

Question 48

In a bilateral contract, each party will be a promisor and, therefore, each party will:

A)be an obligor.
B)be able to avoid the contract.
C)not be in privity of contract.
D)be an agent for the other side.

Question 49

The main thrust of the quasi contract is to:

A)encourage the making of written contracts.
B)prevent enrichment.
C)compensate those who voluntarily help others.
D)prevent unjust enrichment.

Question 50

An offer of a reward for the arrest and conviction of a criminal is an example of a:

A)unilateral contract.
B)bilateral contract.
C)quasi contract.
D)formal contract.

Question 51

Louise owned a house next to Robert's house. Robert made a contract with Midcity Painters to paint his house. The painters arrived to paint Robert's house, but mistakenly painted Louise's house. She saw the painters at work and made no comment. Later, Midcity Painters sent Louise a bill for painting her house. She claimed that she was not liable because she had not made any contract with them. Is this a valid defense?

Question 52

A bilateral contract consists of a:

A)promise for an act.
B)promise for refraining from acting.
C)promise for a promise.
D)promise to contract.

Question 53

A contract under which one or both parties have not yet fully performed is termed a(n):

A)void agreement.
B)executory contract.
C)executive contract.
D)executed contract.