Deck 7: The Essentials of Contract Law

Question 1

In Law and Revolution,Harold J.Berman tells us that some rulers agreed to incorporate the law merchant into their national documents such as the Magna Carta in 1215,which contains a clause that specifically grants safe passage to foreign merchants in England.

Answer 1

True

Question 2

When there is a breach of contract,the injured party has the right to ask a court to somehow remedy the situation.

Answer 2

True

Question 3

A breach of contract occurs when both parties fail to keep their respective promises.

Answer 3

False

Question 4

The quasi-contract concept involves the mutual assent of the parties.

Question 5

An unenforceable contract may have all the elements of a complete contract and still be unenforceable.

Question 6

Vivian,Ewell's friend,believes that Ewell's contract with Mickey is unfair to Ewell.Even though Vivian does not have any tangible stake in the contract,she may sue since she has privity due to her interest in Ewell.

Question 7

Matthew agrees with a friend to divide the proceeds from a bank robbery that the two will commit.This agreement is unenforceable.

Question 8

In the case of an implied-in-fact contract,the court will apply reasons of justice and fairness and may obligate one who has unfairly benefited at the innocent expense of another.

Question 9

When contracting parties accept mutual obligations through oral discussion,they have created a quasi-contract.

Question 10

Clark promises to pay Mike $30 if Mike will mow Clark's yard.This is an example of a bilateral contract.

Question 11

The Uniform Commercial Code (or UCC)is a model code designed to unify statutes governing almost all commercial transactions.

Question 12

Law mercantilism is a complex,adaptive system of overlapping economic agents that operates on the basis of competition and a regulated market that responds to the movement of supply and demand.

Question 13

A person who makes an offer is called an offeree.

Question 14

A contract consists of mutual promises between two parties that can be enforced in a court of law.

Question 15

Void contracts,such as those contracts entered into with a minor,may be avoided or canceled by either of the parties.

Question 16

Gregory sells his land to Tim.Under the Statute of Frauds,Gregory and Tim must have an oral contract to be enforceable in the court of law.

Question 17

Pumping gas into a car at a self-service gas station would be an example of a bilateral contract.

Question 18

Equitable remedies are monetary damages that are imposed by the courts on innocent parties to prevent them from taking advantage of the breach by deliberately raising the amount of damages that the other party has to pay.

Question 19

Legal detriment involves the legal ability to make a contract.

Question 20

Kayla creates a unilateral contract when she promises Sam to give up her right to sue him in exchange for a cash payment.

Question 21

Henrietta offers a $500 reward for the return of Fifi,her lost dog.Silas finds and returns the dog.This is an example of a(n):

A)bilateral contract.
B)unilateral contract.
C)quasi-contract.
D)unenforceable contract.

Question 22

Fair courts,established in 11^th century England,were:

A)tribunals set up in seaport towns to handle disputes involving maritime law.
B)composed of judges who applied fair and equitable principles to commercial transactions.
C)composed of legal scholars who applied common law to all commercial cases.
D)courts in which juries were composed of merchants who were empowered to hear cases involving commercial disputes.

Question 23

A(n)________ contract is implied by the direct or indirect acts of the parties.

A)express
B)implied-in-fact
C)unilateral
D)void

Question 24

________ outlines the historical laws and the procedures that were followed by merchants in commercial transactions.

A)Contract law
B)Commercial law
C)Trade law
D)Lex mercatoria

Question 25

To be enforceable under the Statute of Frauds,a:

A)written contract has to be a formal,preprinted agreement.
B)written contract cannot be keystroked or scrawled.
C)sales slip or a receipt do not qualify as forms of written contracts.
D)written contract can be a notation or a memorandum.

Question 26

Webtel Services,Inc.and Acme Co.sign a document which states that Webtel Services will create a web page for Acme and that Acme will pay for this work.This is an example of a:

A)bilateral,voidable contract.
B)quasi,unilateral contract.
C)bilateral,express contract.
D)unilateral,implied-in-law contract.

Question 27

A proposal made by Braxton to his friend Mike,indicating a willingness to enter a contract to buy Mike's old car for $4,000,fulfills the element of ________ in contract law.

A)capacity
B)consideration
C)mutual assent
D)legality

Question 28

An informal contract is also known as a(n):

A)void contract.
B)quasi-contract.
C)implied-in-fact contract.
D)simple contract.

Question 29

A non-breaching party in a breach of contract case has a ________ and cannot take advantage of the breach that increases the amount of damages the breaching party must pay.

A)duty to mitigate damages
B)right to punitive damages
C)duty to mitigate equities
D)right to specific performance

Question 30

________ exists when an offeror communicates a valid offer with clear and unambiguous terms to the offeree,and the offer has been accepted properly by the offeree.

A)Legality
B)Capacity
C)Consideration
D)Mutual assent

Question 31

Beth and Joan,both 15 years of age,enter into a written contract.In the contract,Beth agrees to do Joan's math homework for two weeks for $50,and Joan agrees to pay Beth at the end of the two-week period.This contract is:

A)implied-in-law.
B)void.
C)unenforceable.
D)voidable.

Question 32

All ________ are ________,but not all agreements are ________ because an agreement may not be ________.

A)agreements;contracts;enforceable;in writing
B)agreements;contracts;contracts;equitable
C)contracts;agreements;contracts;legally enforceable
D)contracts;agreements;contracts;in writing

Question 33

A(n)________ contract does not exist,but is imposed by the court as an equitable remedy in the interests of fairness and justice.

A)quasi-
B)implied-in-fact
C)informal
D)executory

Question 34

Matrix,Inc.contracts with Smalltown Economic Development Corp.to build a factory in Smalltown that will employ 1,000 workers from Smalltown.Matrix later breaches this contract,and Smalltown citizens who were expecting to be employed sue Matrix for breach of its contract.Smalltown citizens' best argument for damages involves the legal doctrine of:

A)quasi contracts.
B)privity of contracts.
C)intended beneficiaries.
D)implied-in-fact contracts.

Question 35

In contract law,the non-breaching party is compensated by the payment of ________ damages to make up for their real financial losses.

A)punitive
B)compensatory
C)consequential
D)incidental

Question 36

A(n)________ contract cannot be upheld by a court of law,although it may have all of the elements of complete contract.

A)unenforceable
B)valid
C)voidable
D)void

Question 37

Article 2 of the ________ is a model set of laws designed to govern the sale of goods in commercial transactions in the United States.

A)Uniform Contract Law Code
B)Uniform Common Code
C)Uniform Civil Code
D)Uniform Commercial Code

Question 38

The doctrine of ________ restricts a party from denying that a promise was made under certain conditions,even though consideration has not been exchanged to bind an agreement.

A)enforceability
B)privity
C)Statute of Frauds
D)promissory estoppel

Question 39

Some parties,when entered into a(n)________ contract,may choose to cancel the contract.

A)unenforceable
B)void
C)voidable
D)valid

Question 40

Which of the following contracts should be in writing to be enforceable in courts under the Statute of Frauds?

A)Contracts that can be completed within one year.
B)Contracts to pay the debt of another.
C)Contracts involving the sale of all types of goods.
D)Contracts in consideration of employment.

Question 41

Jackie takes her car to the All Clean Car Wash and watches the employees while they mistakenly give her car a special $30 hand wax treatment,rather than the $5 spray wax she requested.Jackie refuses to pay $30 saying that she requested a service that would cost her only $5.Analyze the case.

Question 42

Alan persuades Charles to buy his truck by falsely telling Charles that the truck has just had a new engine installed.In fact,the truck has an old engine that has been cleaned to look new.Charles buys the truck and finds out the truth about the engine.Discuss the situation.

Question 43

Mark was speeding on the highway when he and John had a car accident and suffered serious head injuries.As a result,John's memory was affected,and he could not remember any of the incidents on the day of the crash,including the fact that Mark's rash driving caused the car crash.At the hospital,Mark,who suffered minor injuries,convinces John that the crash was no one's fault and just bad luck.John is empathetic and signs a contract with Mark stating that neither party would sue the other for damages.However,Lily,who was with John in the car and was also injured,knows that Mark was responsible and challenges the contract in court,in addition to filing a lawsuit against Mark.Analyze the case.

Question 44

Donita,34,and Terry,25,enter into a contract which stipulates that Donita will allow Terry to occupy her apartment for six months,beginning next month.Terry has agreed to pay a rent of $100 per month.Discuss the elements that make this contract legally binding for Terry and Donita.

Question 45

Georgia purchases what proves to be a defective product from ZBest Enterprise to give to her best friend,Sarah,on her birthday.Georgia refuses to take legal action against ZBest because she is afraid of confrontation.Sarah,wanting to help Georgia,and angry at ZBest,wants to sue ZBest.Discuss the options Sarah has to sue the company.

Question 46

Charleen goes to Big Basket Supermarket and fills her cart with food,pushing it up to a checkout line.Discuss the type of contract between Charleen and Big Basket that would obligate Charleen to pay for the food prior to leaving Big Basket,even if Charleen and the clerk never say a word to each other.

Question 47

Ruben promises to pay Talana $200 if she steals Jessica's business law textbook.Talana steals the business law book,but Ruben,who now feels guilty for his act,refuses to pay Talana and asks her to return the book.Discuss ways in which Reuben has breached the contract.

Question 48

Eloise made a contract in January that gave her until the end of the year to complete her work on a new computer system for Dexter.In mid-July,Eloise is working on the computer system.The contract in July is considered:

A)executory.
B)unenforceable.
C)being expressed.
D)executed.

Question 49

Shannon offered a $50 reward for the return of a lost kitten.When Mark found the kitten and returned it to Shannon,she refused to give him the reward because he had not promised to find the kitten before he went looking for it.Analyze the case.

Question 50

Emerson,a wealthy man,has a special seal made that contains his family crest and motto.Emerson places the seal impression next to his name on every contract that he signs in order to prove that other contracts containing a signature without the impression are forgeries.Discuss the type of contract Emerson makes.

Question 51

Fraser entered into a written contract with the Plastica Company to purchase 100 plastic black bats for a Halloween party he was hosting.The terms of the contract called for Plastica to deliver all 100 bats by October 25.On October 20,Fraser received from Plastica 85 plastic bats and 15 paper red bats.A letter accompanying the shipment stated,"We no longer make plastic black bats.For the inconvenience,we will charge you 15 percent less than the price we originally agreed upon." Was the contract between Fraser and Plastica an executed contract? Explain.