Deck 12: Genuineness of Assent and Statute of Frauds

Question 1

A contract may be rescinded on the grounds that no contract has been formed because there has been no "meeting of the minds" between the parties when there has been a ________.

A) mutual mistake of a material fact
B) mutual mistake of value
C) mistake by the plaintiff
D) mistake by the defendant

Answer 1

A

Question 2

________ is a mistake made by both parties concerning an object that is important to the subject matter of a contract.

A) Mutual mistake of value
B) Mutual mistake of material fact
C) Elementary unilateral mistake
D) Fraud by concealment

Answer 2

B

Question 3

Intentional misrepresentation is commonly referred to as ________.

A) erroneous misrepresentation
B) fraud
C) duress
D) undue influence

Answer 3

B

Question 4

The term scienter means ________.

A) good faith
B) innocent heart
C) bad faith
D) guilty mind

Question 5

A contract in which both parties are mistaken about the value of the object of a contract is considered ________.

A) unenforceable
B) unconscionable
C) nonrescindable
D) void

Question 6

Jeffrey became a victim of fraud when he entered a pyramid scheme which turned out to be a scam.In order to claim damages,Jeffrey has to prove which of the following?

A) good faith on part of the fraudster
B) motive of the fraudster
C) economic injury
D) involvement in the pyramid scheme

Question 7

________ occurs if a person is deceived as to the nature of his or her act and does not know what he or she is signing.

A) Fraud in the inducement
B) Fraud in the factum
C) Fraud by concealment
D) Fraud by suppression

Question 8

While measuring economic injury,the measure of damages recovered from a misrepresentation is ________.

A) the actual value of the property
B) the represented value of the property
C) the difference between the value of the property as represented and the actual value of the property
D) twice the actual value of the property which includes punitive damages

Question 9

Which of the following constitute a mutual mistake of a material fact?

A) Martha selling her house to Graham and hiding the fact that its first floor is damaged
B) Martha and Graham agreeing on the sale of a house, but both referring to different houses
C) Graham buying a house from Martha without asking her details of damages
D) Martha selling Graham an old vase for $20, both of them unaware that it is a valuable antique collectible

Question 10

Which of the following is true of misrepresentation?

A) An innocent party must have relied and acted on the misrepresentation for it to be actionable.
B) An innocent party who acts in reliance on a misrepresentation need not justify his or her reliance.
C) An innocent party must prove that the wrongdoer's misrepresentation was the sole reason he or she entered into the contract.
D) An innocent party need not prove economic injury to recover damages for fraud.

Question 11

Which of the following describes "scienter"?

A) knowledge that a representation is False
B) undue influence used on a party to enter into a contract
C) another term for duress
D) damages given to a victim of fraud

Question 12

Which of the following is true of misrepresentation of a material fact?

A) It can occur only by the words of the wrongdoer.
B) A misrepresentation is actionable as fraud only if it is the sole factor in inducing the innocent party to enter into the contract.
C) It is actionable as fraud if the misrepresentation is of a past or existing material fact.
D) Predictions about the future are considered basis for fraud.

Question 13

In which of the following cases of assent is the rescission of a contract unenforceable?

A) mutual mistake of value
B) misrepresentation of a material fact
C) silence as misrepresentation
D) innocent misrepresentation

Question 14

John buys a watch for $100 at a vintage store.Later,the store learns that the watch was worn by Sean Connery in a James Bond movie and wishes to rescind the sales contract they had with John.Which of the following statements is true in this regard?

A) The store can rescind the contract immediately and refund $100 to John.
B) The store can recover from John the difference between the value of the watch and the amount paid by John.
C) The store can declare the contract void and pay John no money.
D) The store cannot rescind or void the contract.

Question 15

________ 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 16

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 17

To prove fraud,which of the following 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 wrongdoer intended to deceive the innocent party.

Question 18

________ is an action to undo a contract.

A) Rescission
B) Recession
C) Restitution
D) Inception

Question 19

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,but 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 20

Kevin goes to a store to purchase a fully-automatic washing machine.He browses through several models of washing machines but does not let the salesperson know that he wants a fully-automatic model.While signing the sales contract,he does not notice that the model he is purchasing is a semi-automatic machine.After purchase,which of the following options does Kyle have?

A) Exchange the machine with a fully-automatic one and sue the store if it does not accept it.
B) Demand a full cash refund from the store for fraud in concealment.
C) Sue the store for its innocent misrepresentation.
D) Keep the semi-automatic washing machine as he made a unilateral mistake.

Question 21

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) contracts falling under the promissory estoppel

Question 22

Fraud in the inception is also known as fraud in the ________.

A) factum
B) inducement
C) concealment
D) writing

Question 23

________ occurs when the party knows what he or she is signing but has been fraudulently led into the contract.

A) Fraud in the factum
B) Fraud in the inducement
C) Fraud by concealment
D) Misrepresentation of law

Question 24

Millie receives a parcel from her aunt in Indonesia.The delivery man asks her to sign an authorization document to receive the parcel.Millie signs without reading the document,as she is in a hurry.However,on the other side of the document are contract terms that transfer all of Millie's property to the delivery man.This is an instance of ________.

A) fraud in the inception
B) fraud in the inducement
C) fraud by concealment
D) misrepresentation of law

Question 25

Which of the following is true of misrepresentation of law not involving professional?

A) The aggrieved party can sue for damages.
B) The two parties can sue each other for fraud.
C) The aggrieved party may rescind the contract but cannot sue for damages.
D) The innocent party cannot generally rescind a contract.

Question 26

Joe buys a trailer from a used-car dealership.During the sale,the dealer tells him that the trailer is in great condition.However,three days later,the trailer breaks down.Investigation by Joe reveals that the trailer had seven previous owners and that the engine has been replaced thrice.An automobile expert tells Joe that the trailer is in a dangerous state.Which of the following frauds would the dealer be liable for?

A) fraud in the factum
B) fraud in the inducement
C) silence as misrepresentation
D) misrepresentation of law

Question 27

Which of the following describes physical duress?

A) physically damaging the contract documents
B) signing a contract without the knowledge that it represents fraudulent information
C) threatening to physically harm someone if he or she does not sign a contract
D) persuading a person to rescind a valid contract by misrepresenting the facts

Question 28

Leona drove into an eatery and ordered an item called "Volcano Chicken." When asked if the chicken she ordered was very spicy,Leona was informed by Harry-who took the order and was not aware of all details of the eatery yet as he was a new employee-that it was not.However,when Leona took a bite,she found the hot sauce extremely spicy which resulted in her choking on the piece of chicken and requiring medical help.Which of the following statements is true in this context?

A) Harry can be sued for fraud in the inducement.
B) Harry's employment can be terminated for having committed fraud in the inception.
C) Harry can be sued for misrepresentation of the law.
D) Harry cannot be sued due to innocent misrepresentation.

Question 29

Contracts involving fraud in the inducement are ________.

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

Question 30

Which of the following is an example of duress?

A) a plaintiff threatening the defendant that he will not drop the lawsuit until the defendant pays him a certain amount of money
B) a teacher threatening a student that he will be expelled if he is found with cigarettes again
C) a wife threatening to commit suicide if her abusive husband does not stop beating her
D) a father using his dominant and fiduciary position to unduly influence his son into committing a crime

Question 31

Which of the following is not actionable as fraud?

A) misrepresentation of law
B) silence as misrepresentation
C) marriage to obtain rights of immigration
D) identity theft

Question 32

The ________ requires certain contracts to be in writing and signed by the party against whom enforcement was sought.

A) part performance exception
B) common law of contracts
C) equal dignity rule
D) Statute of Frauds

Question 33

________ 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 34

Alice offers Richard a chance to work in her affiliate marketing program which,she claims,will make him a millionaire in three months.Richard makes the "mandatory investment" of $12,000 and becomes an affiliate.Soon,he realizes that such a program does not exist and that Alice has disappeared with the money.This is an instance of ________.

A) misrepresentation of law
B) fraud in the factum
C) fraud in the inducement
D) duress

Question 35

Which of the following constitutes duress?

A) an event that occurs when one person consciously decides to induce another person to rely and act on a misrepresentation
B) a situation in which one person takes advantage of another person's mental, emotional, or physical weakness and unduly persuades that person to enter into a contract
C) a threat to commit extortion unless someone enters into a contract
D) the knowledge that a representation is False or that it was made without sufficient knowledge of the truth

Question 36

Which of the following is true of duress?

A) It is liable for fraud.
B) Its threat should involve physical harm for it to be actionable as duress.
C) It is not enforceable against the innocent party.
D) Intoxicating a person to sign a contract is considered duress.

Question 37

Melissa Harrison,a realtor,sells a house to the Smiths.Before the sale is finalized,Mr.Smith asks Melissa for details of repairs the house has undergone over the years.Melissa gives him details of minor repairs but hides all documents regarding a major plumbing defect that was repaired last year.Three months after the Smiths moved in,the defect reappeared that caused the first floor to flood,damaging their expensive carpet and furniture.Melissa is liable for which of the following frauds?

A) fraud in the inception
B) fraud in the inducement
C) fraud by concealment
D) fraud in the factum

Question 38

Which of the following occurs when one party intentionally hides a material fact from another party?

A) fraud in the inducement
B) fraud in concealment
C) silence as misrepresentation
D) misrepresentation of law

Question 39

While signing a contract,one of the parties misinterpreted a legal clause.Neither of the parties was a legal professional.In this scenario,the party that misrepresented the law ________.

A) is actionable for fraud
B) may rescind the contract
C) is not actionable for fraud
D) can void the contract

Question 40

Gary and Mary are siblings involved in a legal tangle over who gets possession of their ancestral home.Gary threatens to kill Mary's husband if she does not sign papers declaring Gary's sole ownership of their home.This is an instance of ________.

A) scienter
B) battery
C) misrepresentation of law
D) duress

Question 41

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) Neither Jonas nor Chelsea can rescind the contract 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 42

________ refers to the integration made by express reference in one document that refers to and incorporates another document within it.

A) Implied integration
B) Incorporation by reference
C) Executory contract
D) Merger clause

Question 43

A(n)________ occurs when one person agrees to answer for the debts or duties of another person.

A) main purpose exception
B) mortgage
C) guaranty contract
D) implied integration

Question 44

Which of the following contracts is required to be in writing under the Statute of Frauds?

A) a guaranty contract
B) a sale of goods for $200
C) a lease of goods with payments of $100
D) an executed oral contract

Question 45

A right to use someone else's land without owning or leasing it is called ________.

A) mortgage
B) easement
C) life estate
D) leasehold

Question 46

Which of the following situations is an example of undue influence?

A) Jason's doctor threatens him to write a will in his favor.
B) Rebecca enters into a contract with Mark to sell her house with consent.
C) Julia signs an employment agreement with her new employer.
D) Marla signs a lease contract with Emily under mutual consent.

Question 47

________ is a situation in which one person takes advantage of another person's mental,emotional,or physical weakness and unduly persuades that person to enter into a contract.

A) Duress
B) Undue influence
C) Fraud
D) Scienter

Question 48

Which of the following best describes the term lease?

A) an interest in real property given to a lender as security for the repayment of a loan
B) an interest in real property for a person's lifetime
C) the transfer of the right to use real property for a specified period of time
D) a right to use someone else's land without owning or hiring it

Question 49

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

A) merger clause
B) common law of contracts
C) doctrine of equity
D) equal dignity rule

Question 50

Which of the following must be proved to show undue influence?

A) mutual agreement between two parties
B) dominance on the servient party
C) nonexistence of a relationship between two parties
D) free will of the innocent party

Question 51

Which of the following is true of undue influence in entering into contracts?

A) Undue influence need not require the overcoming of the innocent party's free will.
B) Undue influence is not grounds for prosecution, as the innocent party has complete freedom to evaluate the terms of the contract.
C) A contract that is entered into because of undue influence is not voidable.
D) A fiduciary or confidential relationship must have existed between the parties for undue influence to be proven.

Question 52

Which of the following best defines parol evidence rule?

A) It states that contracts for the sale of goods priced at $500 or more must be in writing to be enforceable.
B) It requires that all contracts should be written, whatever their form, and be signed by the party against whom enforcement is sought.
C) It states that any oral or written words outside of the four corners of a written contract are inadmissible in court regarding a dispute over a contract.
D) It requires that a contract entered into by parties prior to marriage that defines their ownership rights in each other's property must be in writing.

Question 53

Which of the following is considered real property under Statute of Frauds?

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

Question 54

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

A) parol evidence rule
B) common law of contracts
C) merger clause
D) one-year rule

Question 55

Which of the following statements is true of signature on a written contract?

A) The contract should be signed by the party who seeks enforcement.
B) The signature of the person against whom enforcement is sought is necessary.
C) The signature must appear at the end of the writing.
D) A stamp, an engraving, or other symbol is not considered to be a signature.

Question 56

A(n)________ is an equitable doctrine that permits enforcement of oral contracts that should have been in writing.

A) parol evidence
B) promissory estoppel
C) equitable exception
D) part performance

Question 57

Which of the following interests in real property transfers to another person after the present holder's death?

A) easement
B) mortgage
C) accommodation
D) life estate

Question 58

In which of the following situations is parol evidence admissible?

A) when both the parties to a contract agree to it
B) when a contract is not ambiguous
C) in case the contract is in agreement with the Statute of Frauds
D) in case of a contract made under duress

Question 59

Which of the following is an interest in real property given to a lender as security for the repayment of a loan?

A) lease
B) mortgage
C) life estate
D) easement

Question 60

Which of the following is true of an equitable estoppel?

A) It contains provisions to exempt the party that has misrepresented the facts from being sued.
B) It states that any oral or written words outside of the four corners of a written contract are inadmissible in court regarding a dispute over a contract.
C) It contains a detailed definition section-usually called a glossary-that defines many of the words and terms used in a contract.
D) It prevents the promisor from raising the Statute of Frauds as a defense to the enforcement of an oral contract.

Question 61

A mistake made by both parties concerning a material fact that is important to the subject matter of a contract is a mutual mistake of a material fact.

Question 62

A misrepresentation occurs when an assertion is made that is in accord with the facts.

Question 63

When there is a mutual mistake of value,the contract remains enforceable by either party because the identity of the subject matter of the contract is not at issue.

Question 64

Scienter refers to knowledge that a representation is False or that it was made without sufficient knowledge of the truth.

Question 65

Fraud by concealment occurs when one party takes specific action to conceal a material fact from another party.

Question 66

A contract is voidable by the innocent party when it is proved that it was entered into by fraud in the inducement.

Question 67

Fraud in the inception occurs if a person is deceived as to the nature of his or her act and does not know what he or she is signing.

Question 68

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

Question 69

Misrepresentation of law will be allowed as grounds for rescission of the contract if one party to the contract is a professional who should know what the law is and intentionally misrepresents the law to a less sophisticated contracting party.

Question 70

Fraud in the inducement is also known as fraud in the factum.

Question 71

Silence is not a misrepresentation when there is a fiduciary relationship between the two parties entering into contract.

Question 72

To prove fraud,it must be shown that the wrongdoer made a False representation of material fact.

Question 73

Silence is not a misrepresentation unless nondisclosure would cause bodily injury or death.

Question 74

Statements of opinion or predictions about the future generally form the basis for fraud.

Question 75

Intentional misrepresentation is commonly referred to as fraudulent misrepresentation,or fraud.

Question 76

While measuring economic injury,the measure of damages is the sum of the value of the property as represented and the actual value of the property.

Question 77

A misrepresentation is not actionable when the innocent party to whom the misrepresentation was made relied on the misrepresentation and acted on it.

Question 78

A contract that is entered into by means of fraudulent misrepresentation can be rescinded by the innocent party.

Question 79

A party may not rescind a contract if there has been a mutual mistake of a material fact.

Question 80

An ambiguity in a contract does not constitute a mutual mistake of a material fact.