Question 1

Generally, in comparison to a donee beneficiary, a creditor beneficiary has

Accepted Answer

A) about the same legal rights. 
B) substantially greater legal rights. 
C) substantially fewer legal rights. 
D) virtually no legal rights.

Question 2

Cheryl enters into a contract with Gabe. In this contract, Cheryl asks Gabe to pay the money he owes her from the contract to her friend Leah because Leah is having financial troubles. Leah is

Accepted Answer

A) a third party creditor beneficiary. 
B) a third party donee beneficiary. 
C) a third party incidental beneficiary. 
D) the promisee in the contract.

Question 3

If Valley Bridge contracts with Rainbow Painters to paint a bridge and the contract requires that only Sherwin Williams paint be used, then Sherwin Williams, as third party beneficiary, will most likely be able to enforce the contract against either Valley Bridge or Rainbow Painters.

Accepted Answer

A) True 
 B)False

Question 4

To win expectation damages, the injured party must prove the breach of contract caused damages that can be quantified with reasonable certainty.

Accepted Answer

A) True 
 B)False

Question 5

A party who benefits from the contract although the contract was not designed for that party's benefit is a(n)

Accepted Answer

A) donee beneficiary. 
B) incidental beneficiary. 
C) creditor beneficiary. 
D) contractual beneficiary.

Question 6

Assignment is prohibited when the obligor is agreeing to perform personal services.

Accepted Answer

A) True 
 B)False

Question 7

Larry wanted to buy a 1957 Cadillac once owned by Reggie Jackson. Larry entered into a contract with the owner agreeing to pay $102,000. The owner subsequently changed his mind. If Larry sues, what remedies are potentially available?

Accepted Answer

The answer of Larry wanted to buy a 1957 Cadillac...

Question 8

Specific performance may be available for the breach of a contract to sell

Accepted Answer

A) an original painting. 
B) 20 shares of Walmart stock. 
C) a Nintendo Wii video game system. 
D) a 2007 Mustang in mint condition.

Question 9

Carlos is hired to paint a house for $700. Before he starts, the woman who hired Carlos tells him she does not want the job done after all. Carlos finds another house-painting job that afternoon, but it pays only $500. If Carlos sues the woman for damages and is awarded $200, that amount is an example of

Accepted Answer

A) direct damages. 
B) nominal damages. 
C) consequential damages. 
D) incidental damages.

Question 10

Martina hires Alexander to renovate her home and specifies that Alexander use Spiffy Painting for all the painting because of Spiffy's excellent reputation. In this case, Spiffy is a(n)

Accepted Answer

A) creditor beneficiary. 
B) incidental beneficiary. 
C) intended beneficiary. 
D) debtor beneficiary.

Question 11

Char-Glo Industries contracted with Evergreen Lawn Service to mow and trim the company's lawn. In the contract, Char-Glo included a clause prohibiting Evergreen from delegating its duties. Courts will ordinarily not enforce such a clause.

Accepted Answer

A) True 
 B)False

Question 12

Ernest operates an ice cream stand during the months of May, June, July, and August. Ernest's ice cream machine is broken and needs a new part to run. He contracts to have the part shipped to him by special carrier. Ernest emphasizes that the part needs to be delivered by April 25 and the carrier agrees, knowing that Ernest intends to open his stand May 1. If the shipper fails to deliver the part on April 25, Ernest will be able to recover consequential damages caused by the delay.

Accepted Answer

A) True 
 B)False

Question 13

In which case would true impossibility NOT apply?

Accepted Answer

A) Nelson contracted with a local restaurant to supply 10,000 pounds of potatoes, but a tornado tore through his field, completely destroying it. 
B) A record company contracted with Darlene to produce a CD of traditional folk ballads; unfortunately, Darlene died before recording began. 
C) Reed agrees to purchase an expensive piece of jewelry for $25,000; a week later, he tells the jeweler that he simply does not have that kind of money. 
D) None of these are correct.

Question 14

Norm and Frank have a legal contract that is silent with regard to an assignment of the contract. In order for Norm to assign all or part of his rights under a contract, Frank must grant such permission to Norm.

Accepted Answer

A) True 
 B)False

Question 15

Andrew Durham was injured in a job-related accident that resulted in a workers' compensation settlement agreement with the employer's insurance carrier, Traveler's Indemnity Company. The settlement agreement required Traveler's to pay Durham $2,500 per month for the rest of his life. To finance its obligation, Traveler's purchased an annuity in its name. The settlement agreement required Traveler's approval or written consent prior to an assignment of the annuity payments. Durham later decided to open a business and went to a credit union for a $214,000 loan. The credit union loaned the money, taking a security interest in Durham's monthly annuity payments. Traveler's consent was never secured. Discuss the conditions in which a right may not be assigned and assess if this was a valid assignment.

Accepted Answer

The answer of Andrew Durham was injured in a job-related...

Question 16

Lawrence took out a life insurance policy in which his daughter, Madeline, is named as a beneficiary. Madeline is a(n)

Accepted Answer

A) promisor. 
B) obligor. 
C) intentional beneficiary. 
D) incidental beneficiary.

Question 17

A third party beneficiary's status occurs

Accepted Answer

A) after an assignment and delegation. 
B) when the third party is informed of the contract. 
C) when the third party beneficiary agrees to the contract terms. 
D) when the contract is created.

Question 18

Expectation interest can best be described as money spent in reliance upon the agreement.

Accepted Answer

A) True 
 B)False

Question 19

Injunctions are frequently used by courts to force employees to complete their contractual obligations with their employers.

Accepted Answer

A) True 
 B)False

Exam 12: Performance of a Contract

Generally, in comparison to a donee beneficiary, a creditor beneficiary has

Cheryl enters into a contract with Gabe. In this contract, Cheryl asks Gabe to pay the money he owes her from the contract to her friend Leah because Leah is having financial troubles. Leah is

If Valley Bridge contracts with Rainbow Painters to paint a bridge and the contract requires that only Sherwin Williams paint be used, then Sherwin Williams, as third party beneficiary, will most likely be able to enforce the contract against either Valley Bridge or Rainbow Painters.

To win expectation damages, the injured party must prove the breach of contract caused damages that can be quantified with reasonable certainty.

A party who benefits from the contract although the contract was not designed for that party's benefit is a(n)

Assignment is prohibited when the obligor is agreeing to perform personal services.

Larry wanted to buy a 1957 Cadillac once owned by Reggie Jackson. Larry entered into a contract with the owner agreeing to pay $102,000. The owner subsequently changed his mind. If Larry sues, what remedies are potentially available?

Specific performance may be available for the breach of a contract to sell

Martina hires Alexander to renovate her home and specifies that Alexander use Spiffy Painting for all the painting because of Spiffy's excellent reputation. In this case, Spiffy is a(n)

Char-Glo Industries contracted with Evergreen Lawn Service to mow and trim the company's lawn. In the contract, Char-Glo included a clause prohibiting Evergreen from delegating its duties. Courts will ordinarily not enforce such a clause.

In which case would true impossibility NOT apply?

Norm and Frank have a legal contract that is silent with regard to an assignment of the contract. In order for Norm to assign all or part of his rights under a contract, Frank must grant such permission to Norm.

Lawrence took out a life insurance policy in which his daughter, Madeline, is named as a beneficiary. Madeline is a(n)

A third party beneficiary's status occurs

Expectation interest can best be described as money spent in reliance upon the agreement.

Injunctions are frequently used by courts to force employees to complete their contractual obligations with their employers.