Deck 12: Defenses to Contract Enforceability

Question 1

To rescind a contract is to cancel it.

Answer 1

True

Question 2

An innocent party can enforce a fraudulent contract.

Answer 2

True

Question 3

Misrepresentation of a material fact can occur through words alone.

Answer 3

True

Question 4

To rescind a contract for fraud,a plaintiff must prove an injury.

Question 5

Under the Statute of Frauds,oral contracts are void.

Question 6

Under the Statute of Frauds,all contracts induced by fraud must be in writ?ing to be enforceable.

Question 7

Forcing someone to enter into a contract through fear created by threats is undue influence.

Question 8

Reliance on a misrepresentation is justified if the misrepresentation is an obviously extravagant statement.

Question 9

Misrepresentation of an opinion is an element of fraud.

Question 10

Under the Statute of Frauds,all written contracts are enforceable.

Question 11

Overestimating the value of an object is a mistake for which a court will normally provide relief.

Question 12

Scienter exists if a party makes a statement that he or she does not be?lieve is true.

Question 13

A contract entered into under duress is voidable.

Question 14

All mistakes of fact are material.

Question 15

Misrepresentation of a material fact cannot occur through conduct alone.

Question 16

An innocent party may seek damages for a fraudulent contract.

Question 17

Intent to deceive is an element of fraud.

Question 18

If a price quotation contains a mistake in the adding of a number of fig?ures,the contract may not be enforceable.

Question 19

To recover for fraud,a plaintiff must be under twenty-one years of age.

Question 20

A mistake of fact can only be bilateral.

Question 21

Oral evidence of otherwise clear terms in a contract can be introduced at a trial to contradict those terms.

Question 22

A contract may have to be in writing to be enforceable even if its performance is possible within a year.

Question 23

Fact Pattern 12-1 (Questions 2-3 apply)
Moore Properties, Inc., offers in writing to sell to Lawn Acres Development Corporation a certain half-acre of land for "$112,000." After Lawn Acres signs the offer in acceptance and returns it, Moore discovers that the price should have been stated as "$121,000."
Refer to Fact Pattern 12-1.Moore's misstatement of the price is

A) a bilateral mistake.
B) a fraudulent misrepresentation.
C) a unilateral mistake.
D) unconscionable.

Question 24

A party's oral agreement to pay another's debt is never enforceable.

Question 25

Oral evidence of the modification of a contract after its making can be introduced at a trial.

Question 26

A contract involving a sale is the only contract relating to an interest in land that must be in writing to be enforceable.

Question 27

Hillside Homes,Inc.,and Ideal Builders,Inc.,enter into a construction contract that includes six pages of detailed calculations.Later Hillside,whose project manager compiled the figures,discovers that some numbers were multiplied incorrectly,but Ideal refuses to make changes.A court would most likely

A) allow the parties to rescind the contract.
B) award damages to Hillside for the mistakes.
C) award damages to Ideal for the mistakes.
D) enforce the contract without requiring changes.

Question 28

To be enforceable,a contract for a sale of goods priced at $50 or more must be in writing.

Question 29

Fact Pattern 12-1 (Questions 2-3 apply)
Moore Properties, Inc., offers in writing to sell to Lawn Acres Development Corporation a certain half-acre of land for "$112,000." After Lawn Acres signs the offer in acceptance and returns it, Moore discovers that the price should have been stated as "$121,000."
Refer to Fact Pattern 12-1.The effect of Moore's misstatement of the price will most likely fall on

A) Moore and Lawn Acres, who must split the difference.
B) Moore only.
C) Lawn Acres only.
D) neither Moore nor Lawn Acres.

Question 30

Fact Pattern 12-2 (Questions 5-6 apply)
Grover contracts to sell two tracts of land to Hank. Both parties believe that the two tracts are adjacent, but in fact they are not. Grover is still willing to sell the land, but under these circumstances the deal would adversely affect Hank.
Refer to Fact Pattern 12-2.The parties' belief about the adjacency of the property is

A) a bilateral mistake.
B) a fraudulent misrepresentation.
C) a unilateral mistake.
D) unconscionable.

Question 31

A contract must be in writing to be enforceable unless its performance is impossi?ble within one year.

Question 32

A contract involving property of any kind must be in writing to be enforceable.

Question 33

An oral contract for a sale of land may be enforceable if the contract has been partially per?formed.

Question 34

May is a stockbroker.Due to May's statements,Nora believes that the price of OK Goods,Inc.(OKGI),a widely traded stock,is going to in?crease sub?stantially.Nora buys 500 shares of OKGI at $10 per share,but the price soon drops to $2.Nora can successfully recover

A) nothing.
B) the amount of the purchase price.
C) the amount of the purchase price plus the expected increase.
D) the amount of the purchase price plus the unexpected decrease.

Question 35

An integrated contract is a contract with more than one subject or part.

Question 36

All collateral promises must be in writing to be enforceable.

Question 37

Oral evidence of the meaning of a contract with incomplete terms can be introduced at a trial.

Question 38

An integrated contract is the final embodiment of the terms of an agreement.

Question 39

To be enforceable,a memorandum evidencing an oral contract that would otherwise be unenforceable must include all essential terms.

Question 40

To be enforceable,a writing evidencing an oral contract that would otherwise be unenforceable must be signed by the party who seeks to enforce it.

Question 41

Joy induces Kelly to enter into a contract for the purchase of a condominium about which Joy knowingly misrepresents a number of material features.When Kelly discovers the truth,Kelly can

A) enforce the contract and seek damages.
B) enforce the contract but not seek damages.
C) neither enforce the contract nor seek damages.
D) seek damages but not enforce the contract.

Question 42

Delta,Inc.,agrees to assume a debt of Excel Company to First State Bank.The agreement is not in writing.To be enforceable,the promise must be for the benefit of

A) any party.
B) Delta.
C) Excel.
D) First State.

Question 43

Used Car Lot's salesperson Vic offers to sell Will,who is twenty years of age,a car about which Vic intentionally misrepresents several material facts.In reliance on the misrepresentations,Will buys the car.To prove fraud in this transaction,Will would not have to show that

A) Vic intentionally deceived Will.
B) Vic misrepresented several material facts.
C) Will is under twenty-one years of age.
D) Will justifiably relied on Vic's misrepresentations.

Question 44

Lara induces Moe to enter into a contract for the sale of an apartment about which Lara fraudulently misrepresents a number of material facts.Lara tells Moe that her commission is 6 percent,but their signed,written contract states "12 percent." The Statute of Frauds governs

A) contracts that are induced by fraud.
B) contracts that must be in writing to be enforceable.
C) the admissibility in court of oral evidence.
D) the merging of oral and written statements into one contract.

Question 45

Gina induces Hugh to enter into a contract for the purchase of a condominium about which Gina knowingly misrepresents a number of material features.When Hugh discovers the truth,he can

A) not rescind the contract.
B) rescind the contract on the basis of fraud.
C) rescind the contract on the basis of mistake.
D) rescind the contract on the basis of undue influence.

Question 46

Ralph offers to sell Sophie,who is seventeen years of age,a car about which Ralph intentionally misrepresents several material facts.In reliance on the misrepresentations,Sophie buys the car.To prove fraud in this transaction,Sophie would have to show that

A) Ralph intentionally deceived Sophie.
B) Ralph made statements that were obviously exaggerated.
C) Sophie does not know anything about cars.
D) Sophie is under eighteen years of age.

Question 47

Elle buys a new textbook for $100 and a used car for $5,000,and signs a one-year lease for an apartment for $1,000 monthly rent to start at the beginning of the next month.The Statute of Frauds covers

A) the apartment lease, and the textbook and car purchases.
B) the apartment lease and the car purchase only.
C) the apartment lease only.
D) the textbook and car purchases only.

Question 48

Don,a salesperson for Excel Autos,promises Fern that a certain car will give her a "smooth ride." Don offers a test drive,which Fern de?clines.She buys the car but soon realizes that its suspension is in poor condi?tion.Fern

A) can rescind the contract on the ground of fraud.
B) can rescind the contract on the ground of misrepresentation.
C) can rescind the contract on the ground of mistake.
D) was not defrauded.

Question 49

Steven,who is Bertha's guardian,convinces her to buy a certain parcel of land from Christy at a greatly inflated price.Steven may be liable for

A) duress.
B) fraud.
C) puffery.
D) undue influence.

Question 50

Century Properties.Inc.,and Broadview Capital Corporation enter into a con?tract for a sale of land.To be enforceable,the contract must be in writing if the land is valued at

A) $50.
B) $500.
C) $5,000.
D) any price.

Question 51

Ollie buys a cup of coffee for $2,a magazine for $5,and a boombox for $600.The requirement of a writing for the enforceability of a contract for a sale of goods at,or for more than,a certain price is governed by

A) the common law.
B) the parol evidence rule.
C) the parties' agreement.
D) the Uniform Commercial Code.

Question 52

Mary induces Nick to sign a contract by placing a gun to Nick's head.The contract is void

A) only if the contract has an illegal purpose.
B) only if the terms are unfair to Nick.
C) under any circumstances.
D) only if the gun was loaded.

Question 53

Nina and Owen enter into an oral contract for Nina's sale to Owen of a la?ser printer for $400.Before Owen takes posses?sion of the printer,the con?tract is enforceable by

A) either party.
B) Nina only.
C) neither party.
D) Owen only.

Question 54

In selling software to Payroll Services Corporation,Ray tells Payroll's purchas?ing agent that the software is "almost human." This is

A) fraud.
B) duress.
C) puffery.
D) undue influence.

Question 55

Fact Pattern 12-2 (Questions 5-6 apply)
Grover contracts to sell two tracts of land to Hank. Both parties believe that the two tracts are adjacent, but in fact they are not. Grover is still willing to sell the land, but under these circumstances the deal would adversely affect Hank.
Refer to Fact Pattern 12-2.Because of the parties' belief about the adjacency of the property,their contract is

A) unavoidable.
B) unconscionable.
C) unenforceable.
D) voidable.

Question 56

Randy and Beach Biz Company enter into an oral contract under which Randy agrees to clean Beach Biz's office for two years.This contract is en?forceable by

A) Randy only.
B) Beach Biz only.
C) either party.
D) neither party.

Question 57

Clay buys an MP3 player for $200 and a pair of stereo speakers for $600 from a Discount City store,and downloads $300 worth of digital music from eMusic.com.To be enforceable,the contract that must be in writing is the purchase of

A) the digital music, the MP3 player, and the speakers.
B) the MP3 player and the speakers only.
C) the MP3 player only.
D) the speakers only.

Question 58

Lem buys a used MP3 player for $50 and a new laptop for $1,500,and signs a one-year employment contract for a $4,000 monthly salary to start at the beginning of the next month.The Statute of Frauds covers

A) the employment contract, and the laptop and MP3 purchases.
B) the employment contract and the laptop purchase only.
C) the employment contract only.
D) the laptop and MP3 purchases only.

Question 59

Gary threatens physical harm to force Hugh to sell his business,Imported Goods,Inc.,to Gary for a below-market price.This is

A) duress.
B) fraud.
C) puffery.
D) undue influence.

Question 60

Olin convinces Pia,who has no artistic ability,that Pia has considerable talent and induces Pia to pay Olin $10,000 for art lessons.When Pia realizes the truth,she files a suit against Olin.Pia is most likely to recover on the basis of

A) fraud.
B) mistake.
C) undue influence.
D) none of the choices.

Question 61

Sid induces Ty to enter into a contract for the sale of a warehouse about which Sid fraudulently misrepresents a number of material facts.Sid also tells Ty that his commission is 6 percent,but their signed,written contract states "12 percent." The parol evidence rule governs

A) contracts that are induced by fraud.
B) contracts that must be in writing to be enforceable.
C) the admissibility in court of oral evidence.
D) the reformation of oral and written statements into one contract.

Question 62

Theo and Uma orally agree on the sale of Theo's Fitness Center to Uma and note the terms on a sheet of the center's stationery,which includes the Center's letterhead but which neither party signs.This agreement is most likely enforceable against

A) neither Theo nor Uma.
B) Theo and Uma.
C) Theo only.
D) Uma only.

Question 63

Macro Marketing,Inc.,and National Food Corporation (NFC)discuss the terms of a contract.Macro faxes NFC a memo on Macro's letterhead that summarizes the items on which they agree.NFC begins to perform,but Macro refuses to pay.Between Macro and NFC,the memo is

A) an oral contract.
B) a pre-contract.
C) a written contract.
D) no contract.

Question 64

Glen and Hadley sign a written contract.Glen claims that the parties later orally agreed to modify the contract.Any oral modification is likely not enforceable if it falls under

A) the doctrine of promissory estoppel.
B) the "main purpose" exception.
C) the "partial performance" exception.
D) the Statute of Frauds.

Question 65

Multi Investments,Inc.,offers to buy Nano Toy Corporation.On May 1,Nano provides copies of its financial statements for the pre?vious year,showing an inventory of $10 million.On May 15,Nano discovers that the previous year's inventory is overstated by $5 million,but does not inform Multi.On June 1,Multi,relying on the fi?nancial statements,buys Nano.On June 10,the buyer discovers the inven?tory over?statement.Can Multi succeed in a suit against Nano for fraud?

Question 66

Fact Pattern 12-4 (Questions 34-35 apply)
Kelly and Lucas sign a written contract for the sale of Kelly's Koffee Kiosk to Lucas. The parties intend their written contract to be a final statement of the terms of their agreement.
Refer to Fact Pattern 12-4.Lucas later disputes some of the provisions of the deal with Kelly.If the dispute results in litigation,a court will most likely exclude evidence that

A) buttresses the written terms.
B) contradicts the written terms.
C) duplicates the written terms.
D) reinforces the written terms.

Question 67

Consumer Goods,Inc.,and Delta Distribution,Inc.,sign a written con?tract for a sale of goods.To be enforceable,this written contract must include

A) a correct title, such as "Purchase Order" or "Sales Invoice."
B) a declaration of the subject matter.
C) a quantity term.
D) the parties' names.

Question 68

Fact Pattern 12-3 (Questions 31-32 apply)
Odell and Paula sign a contract for the sale of Odell's Pizza Parlor to Paula. The parties intend their written contract to be a final statement of most, but not all, of the terms of their agreement-Odell must first buy the building from Quin, after which Odell and Paula will negotiate a final price.
Refer to Fact Pattern 12-3.Paula later disputes some of the provisions of the deal with Odell.If the dispute results in litigation,a court will most likely admit evidence of

A) ambiguous additional terms.
B) consistent additional terms.
C) contradictory additional terms.
D) fraudulent additional terms.

Question 69

Fact Pattern 12-4 (Questions 34-35 apply)
Kelly and Lucas sign a written contract for the sale of Kelly's Koffee Kiosk to Lucas. The parties intend their written contract to be a final statement of the terms of their agreement.
Refer to Fact Pattern 12-4.The writing that Kelly and Lucas signed is

A) a completely integrated contract.
B) a conditionally integrated contract.
C) an agreeably integrated contract.
D) an obviously integrated contract.

Question 70

Waterfront Hotels Corporation in Boston offers a job to Carol,who lives in Denver.Carol orally agrees to work for Waterfront for two years.She moves her family to Boston and begins work.Three months later,she is fired for no stated cause.She files a suit against the employer for rein?statement or pay.Waterfront pleads the lack of a written con?tract.In whose favor is the court likely to rule,and why?

Question 71

Fact Pattern 12-3 (Questions 31-32 apply)
Odell and Paula sign a contract for the sale of Odell's Pizza Parlor to Paula. The parties intend their written contract to be a final statement of most, but not all, of the terms of their agreement-Odell must first buy the building from Quin, after which Odell and Paula will negotiate a final price.
Refer to Fact Pattern 12-3.The writing that Odell and Paula signed is

A) a completely integrated contract.
B) a conditionally integrated contract.
C) a partially integrated contract.
D) a supplementally integrated contract.

Question 72

Uri and Vicky orally agree on the sale of Uri's Nite Club to Vicky and note terms on a pair of the Club's napkins,which they both sign.A written memorandum evidencing an oral contract that would otherwise be unenforceable must contain

A) every term.
B) the essential terms.
C) the preliminary terms.
D) the qualitative terms.