Q 060470RR – Contracts, Part 1
1. Tyler offers to dance naked on Main Street if Corey will mow Tyler’s yard. Corey mows Tyler’s yard.
Which of the following statements is not potential grounds for setting aside the contract?
A. Lack of serious intent to contract
B. Illegality of consideration
C. All of the above are potential grounds for setting aside the contract
D. Inadequacy of consideration
2. Josh runs over Barbara’s dog. Barbara promises not to sue Josh if he pays her $200. Josh pays $200. Then Barbara sues, claiming an agreement not to sue doesn’t constitute consideration. Which of the following is true?
A. Agreement not to sue is consideration only if it approximates what a court would have awarded.
B. Such contracts violate public policy and therefore are unenforceable.
C. Agreement not to sue isn’t consideration.
D. Agreement not to sue is consideration.
3. Candice hires Otto to work as a tax preparer in Candice’s tax return business. The employment contract restricts the ability of Otto to set up a competing business or engage in tax preparation services if Otto leaves Candice’s employ. Otto discovers he likes this kind of work and wants to set up his own tax return business. He asks you whether the restrictions in his contract with Candice will be enforceable. You should tell him that
A. any restriction regarding employment is unenforceable as against public policy.
B. any restriction regarding employment will be enforceable as long as there was adequate consideration.
C. restrictive covenants regarding future employment will be enforceable if they’re reasonable.
D. restrictive covenants regarding future employment will be enforceable if the value of the consideration given for the covenant equals the value of the income loss that would be caused by enforcing the agreement.
4. Delivery of unordered merchandize is considered
A. a contract to purchase unless the recipient contacts the sender to reject the merchandize.
B. a contract to purchase if the items aren’t returned.
C. an offer to sell.
D. performance of a contract.
5. Madison enters into a contract with a DVD club to purchase four DVDs during the coming year. The agreement provided that she would receive an advertisement listing the main selections, which would be sent to her automatically, unless she sent a reply to stop the shipment. The DVD club sent the first month’s advertisement and Madison did nothing. When Madison later received the main selection for that month she complained that she hadn’t accepted it. Must Madison pay for it?
A. Yes, because the price is fair.
B. Yes, because her silence in this case constituted acceptance.
C. No, because her silence in this case didn’t constitute acceptance.
D. No, because Madison didn’t specifically order the goods.
6. Finn agrees to pay $100 to anyone who will paint his house. Will hears about the offer and paints. Finn refuses to pay, saying Will never formally accepted Finn’s offer. Which of the following is true?
A. Will has to formally accept, but can do so within a reasonable time after painting.
B. Offer and acceptance are irrelevant if one of the parties changes position.
C. This is a bilateral contract, and Will didn’t accept.
D. This is a unilateral contract and painting constituted acceptance.
7. Eric, a 17-year-old, signs a contract with the armed services to enlist. Later, Eric changes his mind and wants out of the contract. Can he void the contract based on incapacity to contract?
B. Yes, after he turns 18
C. In some states
8. Manny says to Carmela, “I’ll paint your house for $100.” Carmela says “I accept, provided you also wash the windows.” Under common law, the most likely result in this case is that there’s
A. a contract to paint for $100.
B. no contract.
C. a contract to paint and wash for an amount yet to be determined.
D. a contract to paint and wash for $100.
9. Which of the following is a necessary element both for fraud and for misrepresentation?
A. A fiduciary relationship
B. The intent to deceive
C. A false statement
D. A hidden problem
10. Jacques offers to paint Alisha’s house for $100. Before Alisha responds, Jacques dies. Which of the following statements is true?
A. A representative of Jacques’s estate must find someone to paint Alisha’s house.
B. There’s no contract because Alisha failed to accept Jacques’s offer before he died.
C. A representative of Jacques’s estate must paint Alisha’s house for $100.
D. Jacques’s offer has been revoked.
11. Carrie decides to offer Shelley the opportunity to purchase her motorcycle for just $500. Carrie told Jim, a mutual friend of Shelley and her, that she intended to make the offer. Later, Carrie changes her mind. Shelley approaches Carrie and says she accepts the offer. No contract was formed most likely because
A. Carrie didn’t possess a serious, objective intention.
B. the terms of the offer weren’t definite enough to form a contract.
C. Carrie never communicated the offer to Shelley.
D. Jim was acting as an agent for Shelley without telling Carrie.
12. Jackie tells a group of friends that she plans to sell her home. Meg asks how much Jackie hopes to get for the house, and Jackie replies, “$50,000.” Meg says, “I accept your offer. I’ll purchase your house for $50,000.” No contract exists because
A. the offer isn’t properly communicated.
B. Jackie’s statements are merely preliminary negotiations.
C. Jackie doesn’t seriously intend to enter a contract.
D. the terms of the offer aren’t reasonably certain.
13. Jack is a mature-looking 17-year-old who lives at home with his parents. Jack wants to purchase an automobile. Jack goes to Discount Car Sales, where Bud, the car salesman, never considers that Jack may be a minor. Bud sells Jack a car, with the agreement that Jack will pay Bud $100 per month over the next five years for the car. Which of the following is true?
A. Bud can disaffirm the contract because of Jack’s status as a minor at the time the contract was formed.
B. Bud can hold Jack’s parents liable for Jack’s contract, because Jack was a minor living in their home at the time the contract was formed.
C. Despite Jack’s status as a minor, Bud can prohibit Jack from disaffirming a contract for a necessary (or basic) need.
D. Jack can disaffirm the contract because of his status as a minor at the time the contract was formed.
14. At his 80th birthday party, Graham declares that Elsie is his favorite grandchild and that he will leave Elsie $100,000 on his death. Sadly, Graham dies just three days later. No provision of his will leaves Elsie the $100,000. Elsie files a breach of contract claim against Graham’s estate. The most likely result is that Elsie will lose because no contract existed due to lack of
A. contractual capacity and form.
B. agreement and consideration.
C. contractual capacity and consideration.
D. form and agreement.
15. Jordan is charged with a crime, and Jeff is chosen to be on the jury. Jordan offers to pay Jeff $500 if he votes not guilty. Jeff does so, but Jordan refuses to pay. Jeff sues Jordan for breach of contract. Jeff will
A. lose because the contract is against public policy.
B. win because Jordan materially breached.
C. win because of the statute of frauds.
D. lose because the contract is usurious.
16. Patty visits Big Grocery store and sees a table with bananas on it. Patty picks up a bunch of bananas, walks to checkout, and hands them to the cashier. This is
A. no contract.
B. an express contract.
C. an implied-in-fact contract.
D. an implied-in-law contract.
17. Regan marries at age 17. Then, she enters into a contract with Art to purchase an automobile for $10,000. She later changes her mind and wants to void the contract. Which of the following is true?
A. Regan can void the contract because she is a minor.
B. Regan can’t void the contract because she is over 15.
C. Regan can’t void the contract because she is married.
D. Regan can void the contract because she is married.
18. Lance e-mails Fred, offering to buy his motorcycle for $750. Fred replies, agreeing. Later, Fred declines to honor the agreement, claiming that e-mail agreements aren’t enforceable. In both the initial email and the reply Lance and Fred typed their names. Which of the following is true?
A. There’s no contract because e-mail agreements aren’t enforceable.
B. The e-mails constitute a contract if Lance and Fred have agreed that electronic signatures can be used to create the agreement.
C. There’s no contract because contracts must have hand-written signatures to be enforceable.
D. There’s no contract because the e-mails weren’t witnessed.
19. Juan thinks he would like to purchase Tara’s house, but doesn’t know whether he will be able to save enough money for a down payment on a loan. Juan agrees to give Tara $5,000 for the option to purchase her house for $150,000 sometime within the next five years. Juan and Tara reduce their agreement to writing, sign it, and Juan gives Tara $5,000. Two years later, Juan wins the lottery and now is financially able to purchase Tara’s house. However, that same day Juan receives a letter from Tara revoking her offer to sell for $50,000. Which of the following is true?
A. Juan can’t complain because he failed to accept Tara’s offer before it was revoked.
B. Tara’s revocation is effective.
C. Tara’s revocation is effective as long as she refunds the $5,000.
D. Tara’s revocation isn’t effective.
20. Camille and Paul go to a bar, and Camille has too much to drink. Camille agrees to paint Paul’s house for an agreed-on price. Camille sobers up the next day and decides she wants out of the contract. Which of the following provide Camille with the best argument for getting out of the contract?
A. Emotional duress
B. Camille’s intoxication deprived her of the ability to understand she was entering into a contract.
C. The contract price is too low.
D. Camille’s judgment was impaired by the alcohol.