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Q:
Dick's Burgers n" Shakes enters into an oral contract with Restaurant Equipment Warehouse (REW) for REW's sale to Dick's of a single-spindle milkshake mixer for $300. Assuming the terms can be proved, the contract is enforceable by
a. the seller or the buyer.
b. the manufacturer of the mixer.
c. any third party with an interest in the deal, such as one of Dick's customers.
d. none of the choices.
Q:
Francine buys a new business-law textbook for $125 and a used car for $6,000. She also signs a one-year lease for an apartment for $700 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.
Q:
On Monday, Merlin buys a tablet for $500 from a Pads & Pods store. On Tuesday, he returns to the store and buys a GPS device for $200. On Wednesday, he downloads $100 worth of tunes from singsong.com. To be enforceable, the contract must be in writing for the purchase of
a. the tunes, the GPS device, and the tablet.
b. the GPS device and the tablet only.
c. the tablet only.
d. the tunes only.
Q:
Quest Holdings, Inc., orally contracts for a lease of its facilities to Ray to use for his Swamp & Bayou Fishing Camp. Ray pays part of the rent, takes possession, and improves the property for use by his enterprise. The contract is most likely enforceable by
a. Quest Holdings and Ray.
b. Quest Holdings but not Ray.
c. any interested third party, such as a Swamp & Bayou client.
d. no one.
Q:
Eleanora offers Flossy the amount of an investment in Flossy's start-up business venture if she marries Eleanora's son Glenn. This promise is enforceable
a. only if it is in writing.
b. only if the amount of the investment is more than $500.
c. only if Glenn agrees to marry Flossy.
d. under no circumstances.
Q:
Sharon agrees to assume a debt owed by Tom's Guitars Inc. to United Funds Bank. The agreement is not in writing. To be enforceable under the "main purpose" rule, the promise must be for the benefit of
a. any party.
b. Sharon.
c. Tom's Guitars.
d. United Funds.
Q:
Wild Rides Theme Park owes both RollercoasterRepair, Inc. and Hot Dog Harry money. RollercoasterRepair orally agrees to assume Wild Rides's debt to Hot Dog Harry to prevent Hot Dog Harry from filing suit against Wild Rides. This contract is enforceable by
a. none of these parties.
b. any of these parties.
c. Wild Rides only.
d. RollercoasterRepair only.
Q:
Julie orally agrees to assume Carlyle's debt to FunGames, Inc. Julie gets a substantial personal benefit from the agreementCarlyle agrees to work for Julie's landscaping service for six months. Julie's oral assumption of the debt is enforceable by
a. Julie or Carlyle only.
b. FunGames only.
c. any of the parties.
d. no one.
Q:
Ilsa and Jiffy Loan Company enter into an oral contract under which Ilsa agrees to pay Kyle's debt if he does not. Ilsa does not get any personal benefit from the agreement. This contract is enforceable by
a. any party.
b. Jiffy only.
c. Jiffy or Kyle.
d. none of the parties.
Q:
Marta buys a candy bar for $5 and signs a contract for delivery of fresh flowers to her mother's nursing home every week for the rest of her mother's life. She then enters into a contract to assume George's debt to FastCars Dealership. Marta receives no personal benefit from assuming George's debt. The Statute of Frauds covers
a. the candy purchase only.
b. the candy purchase and the delivery contract only.
c. the contract to assume George's debt only.
d. the contract to assume George's debt and the delivery contract only.
Q:
Big Dog Security Service, Inc. orally agrees to provide security services for NorthGate Mall for as long as NorthGate Mall requires them. This contract is enforceable by
a. Big Dog Security only.
b. NorthGate Mall only.
c. either party.
d. neither party.
Q:
Fiona and Dora enter into an oral contract under which Fiona agrees to work on Dora's farm for not less than one week. This contract is enforceable by
a. Fiona only.
b. Dora only.
c. either party.
d. neither party.
Q:
Jayne and Wilbur enter into an oral contract on May 1 under which Jayne agrees to deliver a collection of exotic wines by April 30 of the following year. This contract is enforceable by
a. Jayne only.
b. Wilbur only.
c. either party.
d. neither party.
Q:
Ted and Svetlana orally agree to several different oral contracts. The Statute of Frauds will bar enforcement of an oral contract for
a. a deal that will be performed within a year.
b. a primary obligation.
c. a sale of goods for $100.
d. a sale of land.
Q:
Selena buys a cell phone for $350 and an air hockey table 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 game table and phone purchases.
b. the employment contract and the game table purchase only.
c. the employment contract only.
d. the game table and phone purchases only.
Q:
An integrated contract is a contract with more than one subject or part.
Q:
Oral evidence of the modification of a contract after its making can be introduced at a trial.
Q:
Oral evidence of otherwise clear terms in a contract can be introduced at a trial to contradict those terms.
Q:
Oral evidence to "fill in the gaps" of a contract with incomplete terms can be introduced at a trial.
Q:
Parol evidence includes testimony about communications between the parties that are not contained in the contract itself.
Q:
Evidence of prior agreements that differ from the written terms of a contract can be introduced in court to alter the contract.
Q:
To be enforceable as a contract, a writing must have been signed by the party who seeks to enforce it.
Q:
An oral contract may be enforceable if enforcing the promise is the only way to avoid injustice.
Q:
An oral contract may be enforceable if the person making the promise could foresee that the promisee would rely on the promise.
Q:
In some states, an otherwise unenforceable oral contract may be enforced under the doctrine of promissory estoppel.
Q:
An oral contract for a sale of goods for more than $5,000 is not enforceable even if the parties to it admit to its existence in court.
Q:
To be enforceable, a memorandum evidencing an oral contract that would otherwise be unenforceable must include the essential terms.
Q:
There are no exceptions to the writing requirement of the Statute of Frauds.
Q:
Courts may grant specific performance of an oral contract to transfer an interest in land that has been partially performed.
Q:
A contract for a sale of goods priced at $501 must be in writing to be enforceable.
Q:
Prenuptial agreements are agreements made during a wedding ceremony that define each partner's duties to one another during the marriage.
Q:
A prenuptial agreement must be in writing to be enforceable.
Q:
A party's oral agreement to pay another's debt is NOT enforceable if the party's main purpose is to derive a benefit for himself or herself.
Q:
A primary obligation is created when a party agrees to pay for something on the condition that a certain other party does not make the payment.
Q:
A collateral promise is one made by a third party to assume the debts or obligation of a primary party to a contract if the primary party does not perform.
Q:
A contract in which a party assumes a secondary obligation must be in writing to be enforceable.
Q:
Any collateral promise falls outside the Statute of Frauds and does not need to be in writing to be enforceable.
Q:
An agreement that includes an option to purchase real property must be in writing for the option to be enforced.
Q:
A contract for lifetime employment cannot not be performed within one year and so it must be in writing to be enforceable.
Q:
A contract involving property of any kind must be in writing to be enforceable.
Q:
Under the Statute of Frauds, fixtures, such as buildings, growing crops and minerals, are treated as real property.
Q:
Under the Statute of Frauds, an oral contract for the transfer of a mortgage is enforceable.
Q:
An oral contract for a transfer of land is always enforceable.
Q:
A contract must be in writing to be enforceable if the contract makes performance possible within any definite period of time.
Q:
A contract must be in writing to be enforceable if it makes performance possible only over a period of more than one year.
Q:
The writing requirement under the Statute of Frauds means that an agreement must be a formal written contract.
Q:
Every state has a statute that stipulates what types of contracts must be in writing.
Q:
The primary purpose of the Statute of Frauds is to ensure that all parties to a contract understand all the terms of the contract.
Q:
The Statute of Frauds is a compilation of all the laws and regulations related to fraud.
Q:
Under the Statute of Frauds, oral contracts are void.
Q:
Floramaria is an elderly woman who lives with her niece Galaxy. Floramaria is dependent on Galaxy for support. Galaxy advises Floramaria to "invest" in Galaxy's "professional gambling" venture, or Galaxy will no longer support her. Floramaria liquidates her other investments and signs a contract with Galaxy, to whom Floramaria gives the funds. Can Floramaria set aside this contract?
Q:
Multi Investments, Inc., offers to buy Nano Toy Corporation. On May 1, Nano provides copies of its financial statements for the previous 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 financial statements, buys Nano. On June 10, the buyer discovers the inventory overstatement. Can Multi succeed in a suit against Nano for fraud?
Q:
Dumont threatens physical harm to force Eddie to sell his business, Citywide Vending, Inc., to Dumont for a below-market price. This is
a. duress.
b. fraud.
c. a unilateral mistake.
d. undue influence.
Q:
Drake enters into a contract with Eve, who claims to have access to a stock-trading algorithm that will multiply an investment many times over. When the results do not match this promise, Drake learns that Eve does not have access to any unique software and files a suit against her, alleging fraud. Proof of an injury is required to
a. recover damages.
b. rescind the contract.
c. undo Eve's influence.
d. punish the defendant.
Q:
Mona is induced by her guardian Newt to sign a contract to invest her student loan funds in Overseas Bank through Newt's investment firm. Unknown to Mona, Newt realizes ongoing commissions from the investment. Most likely, Mona may
a. not rescind the contract.
b. rescind the contract on the basis of undue influence.
c. rescind the contract on the basis of mistake.
d. rescind the contract on the basis of opinion.
Q:
Lou uses undue influence to induce Mona to sign a contract to invest her student loan funds in National Overseas Bank. Mona may
a. avoid the contract or choose to carry it out.
b. do nothing once she has signed the contract.
c. recover from her lender for a failure to influence her "due."
d. recover from the bank for a failure to undo Lou's influence.
Q:
Seth offers to buy a house from Tia for less than Tia paid for it, stating that he would "hate to see anything bad happen to Tia or her house." Tia agrees to sell. Regarding this agreement, a court would likely
a. enforce it.
b. not enforce it.
c. reform it to reflect the true market value of the property.
d. order the parties to renegotiate the price.
Q:
Scienter exists if
a. Martin knows that the transmission on his truck is defective, but does not tell this fact to potential buyers.
b. The racehorse that Karen is trying to sell has a genetic defect, but Karen does not know about the defect, and so she does not warn potential buyers.
c. Jake, a real estate agent, tells a client that he has a house that "will make all her dreams come true."
d. Jon forces Bill to sign a contract to sell Jon a car below market value.
Q:
Beau sells a 1940 Ford pick-up truck car to Cody without disclosing that he had originally planned to restore the truck but changed his mind because of the cost. Beau is liable for
a. opinion.
b. fraud.
c. mistake.
d. nothing.
Q:
Mark fails to reveal a material fact in a business deal with Nancy. This constitutes fraud
a. if Mark is unaware of the fact and the failure.
b. if the amount of consideration received is grossly inadequate.
c. if the fact concerns a serious defect known to Mark and unlikely to be known by Nancy.
d. under any circumstances.
Q:
Gene sells a trail bike to Hollis without disclosing that the odometer, which reads 10,000 miles, was disconnected 90,000 miles ago. Gene is most likely liable for
a. undue influence.
b. fraud.
c. mistake.
d. nothing.
Q:
In a bike shop, Barrie, who is not knowledgeable about bikes, overhears Cullen say, "This bike could win any race!" Barrie buys the bike, but does not win any races with it. Cullen's statement is
a. a mistake.
b. fraudulent.
c. an opinion.
d. an attempt at undue influence.
Q:
Kari, a real estate agent, assures Linc that a certain parcel of commercial property fronts on the most highly trafficked street in Metro City. Linc buys the property and then discovers that the street has no more traffic than any other in its vicinity. Linc is most likely a victim of
a. opinion.
b. fraud.
c. mistake.
d. nothing.
Q:
Creighton applies to BigData Corporation for a position as a software engineer. Creighton has no training in computers or programming and no background as an engineer. After Creighton is hired, BigData learns the truth. BigData 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.
Q:
Winona enters into a contract with Peyton to buy Peyton's land based on Peyton's assertion that the land is legally open to development. After the sale, Winona learns what Peyton knew previouslyonly a small section of the land can be built on. A local law prohibits construction on the rest of the property. Winona can
a. not avoid the contract because persons are assumed to know the law.
b. avoid the contract due to a mutual mistake.
c. avoid the contract due to a mistake in value.
d. avoid the contract due to fraud.
Q:
In selling a 300-acre farm to Rural Land Investments, Inc., Simone tells the buyer's representative that the land "will be worth twice as much by next year." This is
a. undue influence.
b. fraud.
c. a mistake.
d. an opinion.
Q:
Garland induces Jules to enter into a contract for the purchase of a Chef's Burger House restaurant. Garland knowingly misrepresents a number of material features about the restaurant and the business. When Jules discovers the truth, he can
a. not rescind the contract because Jules assumed the risk that the bargain would prove to be different from what he thought.
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.
Q:
Barb, a real estate agent, is showing John a house. She tells him that this is a house where "his family can live happily ever after." John buys the house, but his wife does not like it. John
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.
Q:
Andy knows nothing about horses. Peter, an expert horse trainer, knows that a certain horse has no talent and is not likely to win any competitions. Peter convinces Andy to buy the horse for $500,000 by assuring him that it has great talent. The horse turns out to have no talent and never wins any competitions. Andy can most likely recover damages based on
a. fraud.
b. mistake.
c. undue influence.
d. none of the choices.
Q:
James is in an art gallery when Mitch, who has no special art expertise, points to a painting and says, "That artist is so good. That piece will be worth a fortune in a few years!" James buys the painting, which does not turn out to be valuable. James tries to return the painting and recover his purchase price. A court will
a. order the art gallery to pay James the full purchase price.
b. order Mitch to pay James the full purchase price.
c. enforce the contract between James and the art gallery.
d. enforce the contract between James and the art gallery, but order Mitch to pay James the full purchase price.
Q:
Pete, an accountant, convinces his client Kasey to invest her savings in a nonexistent social-networking Web site. When Kasey learns the truth, she can
a. seek to void the contract on the ground of undue influence.
b. recover damages based on a claim of mistake of value.
c. rescind the contract to invest in the Web site.
d. seek to void the contract on the ground of unconscionability.
Q:
Phoebe enters into a contract with Everest for a guided tour of Whitewater Canyon. Everest acts as though he is an experienced, knowledgeable guide, when in reality he has never been in the canyon. Phoebe is most likely a victim ofa. undue influence.b. fraud.c. mistake.d. nothing.
Q:
Digital Storage, Inc., offers to sell provide cloud-computing services to Entrepreneur Enterprises, Inc., but mistakenly transposes some of the digits in the price so that $15,400 appears in the offer as $14,500. Entrepreneur Enterprises accepts the written offer. Digital Storage's best defense against enforcement of the contract is that Entrepreneur Enterprises knewa. a bilateral mistake supports the cancellation of a contract.b. a mistake of value supports the cancellation of a contract.c. a unilateral mistake supports the cancellation of a contract.d. the price was below the prices of comparable devices.
Q:
Digital Storage, Inc., offers to sell provide cloud-computing services to Entrepreneur Enterprises, Inc., but mistakenly transposes some of the digits in the price so that $15,400 appears in the offer as $14,500. Entrepreneur Enterprises accepts the written offer.Entrepreneur Enterprises' best argument in favor of enforcement of the contract is thata. a bilateral mistake does not afford relief from a contract.b. a mistake of value does not afford relief from a contract.c. a unilateral mistake does not afford relief from a contract.d. the price was below the prices of comparable devices.
Q:
At an auction for the first time, Dulcinea bids on a one-hundred-year-old Edison-brand phonograph, believing that it is worth more than the price asked. When the item proves to be less valuable, Dulcinea isa. liable on the bid.b. not liable on the bid because Dulcinea overestimated the value of the auctioned item.c. not liable on the bid because the auctioneer overstated the value of the auctioned item.d. not liable on the bid because this was Dulcinea's first auction.
Q:
Organic Farms Company contracts to buy two tracts of land from Prime Bottomland, Inc. Both parties believe that the two tracts are adjacent, but in fact they are not. Prime Bottomland is still willing to sell the land, but under these circumstances the deal would adversely affect Organic Farms. Because of the parties' belief about the adjacency of the property, their contract isa. unavoidable.b. unconscionable.c. unenforceable.d. voidable.
Q:
Organic Farms Company contracts to buy two tracts of land from Prime Bottomland, Inc. Both parties believe that the two tracts are adjacent, but in fact they are not. Prime Bottomland is still willing to sell the land, but under these circumstances the deal would adversely affect Organic Farms. The parties' belief about the adjacency of the property isa. a bilateral mistake.b. a fraudulent misrepresentation.c. a unilateral mistake.d. unconscionable.
Q:
Dwight believes that a new phone to be sold by Ear Sonic Corporation will become the most widely bought and used phone in the global market. Dwight enters into a contract to buy 500 shares of Ear Sonic stock, anticipating an increase in its value. If the price of the stock does not rise, Dwight can recovera. 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.
Q:
Lewis, an employee of Silos, Inc., makes a substantial mathematical error in totaling the estimated costs for a project for which AgriCo-op is seeking bids. Consequently, Silos's bid is significantly low. Any contract with AgriCo-op that includes the mistake may be rescindeda. if the mistake involves a material fact.b. if the mistake involves any fact.c. if the mistake is one of value or quality.d. under no circumstances.
Q:
Lewis, an employee of Silos, Inc., makes a substantial mathematical error in totaling the estimated costs for a project for which AgriCo-op is seeking bids. Consequently, Silos's bid is significantly low. Any contract with AgriCo-op that includes the mistake may be rescindeda. if the error was made inadvertently and without gross negligence.b. if the error was made intentionally or negligently.c. if the error was made intelligently but distractedly.d. under no circumstances.