Deck 10: Performance and Breach of Traditional and E-Contracts

Question 1

Intentional misrepresentation is considered fraud.

Answer 1

True

Question 2

A misrepresentation is considered fraud even if it is made without intent to deceive another party.

Answer 2

False

Question 3

The signature of the person who is enforcing the contract is necessary.

Answer 3

False

Question 4

If there has been a mutual mistake, the contract cannot be rescinded.

Question 5

A unilateral mistake is a mistake in which only one party is mistaken about a material fact regarding the subject matter of a contract.

Question 6

A material fact is a fact that is irrelevant to the subject matter of a contract but pertains to the conduct of the parties.

Question 7

If Johnny made an oral contract with Peter to sell Peter his truck for $15,000, Johnny's eventual refusal to sell the truck is considered breach of contract.

Question 8

The measure of damages awarded to the innocent party for fraud is the difference between the value of the property as represented and the actual value of the property.

Question 9

A unilateral mistake occurs if both parties know the object of the contract but are mistaken as to its value.

Question 10

Duress is a situation in which one party threatens to do a wrongful act unless the other party enters into a contract.

Question 11

Trees, crops, minerals and timber are not considered real property and are thus barred from being included in contracts involving interests in real property.

Question 12

To be actionable as fraud, the misrepresentation must have been the sole factor in inducing the innocent party to enter into the contract.

Question 13

Duress only occurs where a threat involves physical harm.

Question 14

An ambiguity in a contract may constitute a mutual mistake of a material fact.

Question 15

The term "scienter" refers to the knowledge that a representation is false or that it was made without sufficient knowledge of the truth.

Question 16

If a modification of the lease contract increases the lease payment to $1,000 or more, the modification has to be in writing to be enforceable.

Question 17

According to the equal dignity rule, agents' contracts to sell property covered by the Statute of Frauds must be in writing to be enforceable.

Question 18

Duress occurs when one person takes advantage of another person's mental, emotional, or physical weakness and unduly persuades that person to enter into a contract.

Question 19

The doctrine of part performance allows the court to order an oral contract for the sale of land or transfer of another interest in real property to be specifically performed if performance is necessary to avoid injustice.

Question 20

The one-year rule states that an executory contract that cannot be performed by its own terms within one year of its formation must be in writing.

Question 21

Kimlon Informatics has to recover $5000 from a client for its services. The recovery period is 100 days but Kimlon needs the money immediately. It sells the right of collecting money from its client to Quikcollect, a collection agency. Here, Kimlon Informatics is the ________.

A) obligor
B) obligee
C) subassignee
D) assignee

Question 22

Jonas enters into an oral contract with Chelsea to lease his house to her for $100,000. Chelsea pays him $100,000 and moves in. A month later, Jonas learns that his state requires contracts for the lease of goods with payments of $1,000 or more to be in writing. Which of the following options does either party have?

A) Jonas can evict Chelsea as the contract does not comply with the Statute of Frauds and is hence void.
B) The contract cannot be rescinded by either party as it has already been executed.
C) Chelsea can rescind the contract on the grounds of noncompliance with the Statute of Frauds.
D) Jonas can rescind the contract on the grounds of noncompliance with the Statute of Frauds.

Question 23

A contract involving mutual mistake of value is ________.

A) rescindable
B) voidable
C) non-rescindable
D) void

Question 24

________ is a situation in which one party threatens to do a wrongful act unless the other party enters into a contract.

A) Scienter
B) Duress
C) Battery
D) Assault

Question 25

Substantial performance of a contract constitutes material breach.

Question 26

A party who owes a duty of performance under a contract is called the ________.

A) obligor
B) assignor
C) assignee
D) oblige

Question 27

A covenant is an unconditional promise to perform.

Question 28

Which of the following is true of a unilateral mistake?

A) Only one mistake or ambiguity is present in the subject matter of the entire contract.
B) Out of several contracts drafted simultaneously between two parties, one has a mistake in its subject matter that does not concern the other contracts.
C) Only one party is mistaken about a material fact regarding the subject matter of a contract.
D) A single mistake about a material fact in the subject matter of a contract appears several times in the contract.

Question 29

Which of the following scenarios makes Tim liable for undue influence?

A) He uses a false identity, borrows $10,000 from Kelly, and disappears with the money.
B) He threatens to kill Carlos if Carlos does not sign a contract that transfers all his property to Tim.
C) He takes advantage of his grandmother's illness and persuades her to sign a will leaving all her property to him.
D) He threatens to bring a lawsuit against Carlos if Carlos does not make him a partner in his firm.

Question 30

Which of the following is considered "real property"?

A) a fixture permanently affixed to a building
B) fifty-one percent partnership in a firm
C) a car
D) diamond jewelry

Question 31

Parol evidence rule stipulates that the contract is a complete integration and the exclusive expression of the parties' agreement.

Question 32

Which of the following does Section 2A-201(1)of the Uniform Commercial Code state?

A) All lease contracts must be in writing.
B) Lease contracts involving payments of $1,000 or more must be in writing.
C) All sales contracts must be in writing.
D) Sales contracts involving payments of $500 or more must be in writing.

Question 33

Which of the following contracts is required to be in writing in most states?

A) contracts for the sale of goods for $100
B) contracts for the lease of goods with payments of $500
C) promises to write a will
D) handshake deals

Question 34

The agreement whereby the parties agree to accept something different in satisfaction of the original contract is called restitution.

Question 35

Unilateral rescission of a contract constitutes a breach of that contract.

Question 36

Heather chooses to buy a scarf at Macy's and reads the price on the tag as $50. She uses her credit card to pay for the scarf and post-purchase, she notices that the price tag actually says $500. This is an instance of a(n)________.

A) bilateral mistake
B) mutual mistake of value
C) innocent misrepresentation
D) unilateral mistake

Question 37

________ says that if a written contract is a complete and final statement of the parties' agreement, any prior or contemporaneous oral or written statements that alter, contradict, or are in addition to the terms of the written contract are inadmissible in court regarding a dispute over the contract.

A) Main purpose exception
B) Leading object exception
C) Parol evidence rule
D) Promissory estoppel

Question 38

________ is an event that occurs when one person consciously decides to induce another person to rely and act on a misrepresentation.

A) Fraudulent misrepresentation
B) Unilateral mistake
C) Bilateral mistake
D) Erroneous misrepresentation

Question 39

The doctrine of ________ allows the court to order an oral contract for the sale of land or transfer of another interest in real property to be specifically performed if it has been partially performed and performance is necessary to avoid injustice.

A) part performance
B) undue performance
C) equitable performance
D) promissory estoppel

Question 40

In order to prove fraud, which of these elements must be shown?

A) The innocent party knew the wrongdoer.
B) The innocent party was the one who detected fraud.
C) The wrongdoer assumed a false identity.
D) The innocent party relied on the wrongdoer's representation.

Question 41

________ refers to a third party who is not in privity of contract but who has rights under the contract and can enforce the contract against the promisor.

A) Third-party contractor
B) Assignee
C) Sub-assignee
D) Intended third-party beneficiary

Question 42

James hires Franco for a painting job. Their contract explicitly states that Franco's employment can be terminated if he is employed by another party during the contract period. Two weeks into the job, James finds out that Franco is also working for a painting agency two blocks away and terminates his employment. This is an instance of ________.

A) Condition precedent
B) Condition subsequent
C) Concurrent condition
D) Implied condition

Question 43

An award of ________ orders the breaching party to perform the acts promised in a contract.

A) reformation
B) injunction
C) restitution
D) specific performance

Question 44

Which of the following terms refers to an unconditional and absolute offer by a contracting party to perform his or her obligations under a contract?

A) injunction
B) writ of garnishment
C) tender of performance
D) writ of attachment

Question 45

Which of the following statements is true of a breach of contract?

A) Strict performance by a party discharges that party's duties under the contract.
B) Inferior performance constitutes a minor breach of contract.
C) Substantial performance constitutes a material breach.
D) The most common remedy for a breach of contract is an award of equitable remedies.

Question 46

Which of the following is true of monetary damages?

A) Monetary damages are available only for material breaches of contract.
B) Dollar damages are not monetary damages.
C) Compensatory damages are not monetary damages.
D) Consequential damages are monetary damages.

Question 47

Which of the following phrases explain the term covenant?

A) an unconditional promise to perform
B) a breach of contract
C) mutual rescission of a contract
D) successive assignments of a right

Question 48

Which of the following refers to an agreement that substitutes a new party for one of the original contracting parties and relieves the existing party of liability on the contract?

A) novation
B) substituted contract
C) mutual rescission
D) accord

Question 49

________ is a clause in a contract in which the parties specify certain events that will excuse nonperformance.

A) Approval clause
B) Express condition
C) Force Majeure
D) Implied-in-fact condition

Question 50

Kinetosphere Automation Inc. (K.A.)makes a mandatory employment contract with all its employees. The contract states that K.A.'s employees are not to work for any other organization while they are employed by K.A. If K.A. finds an employee who is also serving another company, it can approach the court to obtain a(n)________ to prevent the employee from working in the other company.

A) restitution
B) rescission
C) injunction
D) subjugation

Question 51

KnockKnock is a manufacturer of stainless-steel locks which are well known for their durability. The company contacts a new supplier and forms a supply contract. The contract states that KnockKnock would only purchase steel from the supplier if the material supplied was high-grade Type 102 stainless steel. This is an instance of a ________.

A) condition subsequent
B) concurrent condition
C) covenant
D) condition precedent

Question 52

Poole Contractors makes a contract with Delta Resources to pay $50,000 for the supply of 500 truckloads of sand within next week. Delta Resources delivers the sand in two days after the contract was made. Poole Contractors pays the $50,000 promised in the contract. This is an instance of ________.

A) substantial performance
B) material breach
C) minor breach
D) strict performance

Question 53

Lionel Richmond is a soccer player who has a six-year contract with the Christshire United soccer team. Two years into the contract, he meets with an accident which results in the complete amputation of his right leg. On what basis is Richmond discharged from further performance of the contract?

A) Novation
B) Substituted contract
C) Accord and satisfaction
D) Discharge by impossibility

Question 54

Which of the following is true of discharge of performance by agreement?

A) A partially executed contract cannot be rescinded.
B) Mutual rescission requires parties to enter into a second agreement that expressly terminates the first one.
C) A party is allowed to rescind a contract without the consent of the other party.
D) Unilateral rescission is not regarded as breach of contract.

Question 55

Which of the following is true of covenants and conditions?

A) A covenant is a conditional promise to perform.
B) A condition becomes a covenant if it is met.
C) A contract cannot contain conditions to excuse performance.
D) A party cannot sue over breach of a covenant by the other party.

Question 56

Mary buys a new toaster for $500. The toaster's label bears a disclaimer stating that the manufacturer is not liable for consequential damages. On Monday morning, while Mary is using the toaster, it emits sparks and damages the electric wiring in the kitchen. The electrician tells Mary that the toaster malfunctioned and that the cost of repairs in her kitchen would come up to $2000. What can Mary recover from the manufacturer of the toaster?

A) $500
B) $2500
C) $2000
D) no damages can be recovered

Question 57

________ refers to an equitable doctrine that permits the court to rewrite a contract to express the parties' true intentions.

A) Reformation
B) Injunction
C) Conjunction
D) Garnishment

Question 58

________ refers to a condition whose occurrence or nonoccurrence of a specific event automatically excuses the performance of an existing contractual duty to perform.

A) Condition precedent
B) Condition subsequent
C) Concurrent condition
D) Implied condition

Question 59

________ refers to a condition that requires the occurrence of an event before a party is obligated to perform a duty under a contract.

A) Condition precedent
B) Condition subsequent
C) Concurrent condition
D) Implied condition

Question 60

A(n)________ breach of a contract occurs when a party renders inferior performance of his or her contractual obligations.

A) material
B) minor
C) anticipatory
D) defensive

Question 61

A(n)________ refers to a promise in which one person agrees to answer for the debts or duties of another person.

Question 62

As a part of a downsizing initiative, Richmond and Sons fired an employee before his employment contract lapsed. Is the employee responsible to mitigate damages? Explain.

Question 63

A(n)________ is a clause in a contract which stipulates that it is a complete integration and the exclusive expression of the parties' agreement.

Question 64

________ of the UCC is the basic Statute of Frauds provision for sales contracts.

Question 65

The ________ is an equitable doctrine that allows the court to order an oral contract for the sale of land or transfer of another interest in real property to be specifically performed if it has been partially performed and performance is necessary to avoid injustice.

Question 66

________ is an action to undo a contract.

Question 67

How is a mistake different from an act of fraud?

Question 68

Distinguish between conditions and covenants.

Question 69

________ refers to a situation in which a party threatens to do a wrongful act unless another party enters into a contract.

Question 70

A(n)________ is an unconditional promise to perform.

Question 71

In a(n)________ mistake, only one party is mistaken about a material fact regarding the subject matter of the contract.

Question 72

A(n)________ exists if both parties know the object of the contract but are mistaken as to its value.

Question 73

________ refers to the knowledge that a representation is false.

Question 74

Intentional misrepresentation is commonly referred to as ________.

Question 75

An obligee who transfers a right is known as a(n)________.

Question 76

Distinguish between minor breach and material breach.

Question 77

Explain the creation and working of guaranty contracts.

Question 78

The ________ says that agents' contracts to sell property covered by the Statute of Frauds must be in writing to be enforceable.

Question 79

A(n)________ is a party who is unintentionally benefited by other people's contracts.

Question 80

The term ________ refers to any oral or written words outside the four corners of a written contract.