Q&A Hero

Q: Which of the following is true regarding the statute of frauds' writing requirement? A. The writing must be contained in one document. B. The writing must be signed by both parties. C. The writing must be signed by the buyer. D. The writing must indicate the parties' identities.

Q: Whose signatures are needed in order to satisfy the statute of frauds? A. Only the signatures of witnesses to the agreement are required. B. Only the signature of the party, attempting to enforce the contract, is required. C. Only the signature of the party against whom enforcement is being sought. D. Only the signature of the third party to the contract, the beneficiary, is required.

Q: A contract that cannot be performed within one year from the day on which it comes into existence: A. is within the statute of frauds. B. need not be in writing. C. is called a unilateral contract. D. is essentially illegal.

Q: A bilateral contract is "taken out of the statute of frauds" when: A. it is completed within a year from the day of its existence. B. it is fully performed by at least one party. C. it is put in writing. D. it has strict rules of performance.

Q: Guy and Boyd make an oral contract whereby Guy agrees to sell Boyd, 480 widgets (goods) at a price of $480. Later, the parties want to modify the contract so that the price would become $520. This modification: A. must be in writing. B. must be oral because the first contract was oral. C. can be oral but need not be. D. is unenforceable because the first contract is unenforceable.

Q: With regard to an agreement for the sale of real estate, the statute of frauds: A. does not require that the agreement be signed by all parties. B. does not apply if the value of the real estate is less than $500. C. requires that the entire agreement be in a single writing. D. requires that the purchase price be equal to the value of the real estate.

Q: Smith and Benson make an oral contract for the sale of some land at a price of $500,000. After paying Smith $400,000 of the purchase price, Benson takes possession of the land. One month later, Smith wants to boot Benson off the land. His argument is that the parties' oral agreement is unenforceable under the statute of frauds. Which of the following is most correct? A. Smith is correct, because the contract is for an amount greater than $500. B. Smith is correct, because this is an oral contract for the sale of real estate. C. Smith is incorrect, because the contract is for an indefinite period of time. D. Smith is incorrect, because Benson paid part of the purchase price and took possession.

Q: Which statement about the statute of frauds is true? A. All contracts must be in writing in order to be enforced. B. Contracts for the sale of goods for $500 or more must be in writing in order to be enforced. C. Contracts for the sale of land for $500 or more must be in writing in order to be enforced. D. All employment contracts must be in writing in order to be enforced.

Q: On May 1, Dix and Wilk entered into an oral agreement by which Dix agreed to purchase a small parcel of land from Wilk for $450. Dix paid Wilk $100 as a deposit. The following day, Wilk received another offer to purchase the land for $650, the fair market value. Wilk immediately notified Dix that Wilk would not sell the land for $450. If Dix sues Wilk for specific performance, Dix will: A. prevail, because the amount of the contract was less than $500. B. prevail, because there was part performance. C. lose, because the fair market value of the land is over $500. D. lose, because the agreement was not in writing and signed by Wilk.

Q: Sean made an oral promise to sell a piece of land to Sean. Sean took a huge loan from the bank by mortgaging everything he had. After taking almost half the money from Manny, Sean decides that he wants to sell the land to Jason who is offering a higher price for the property. Which of the following doctrines can Manny take recourse to in order to implement his oral contract with Sean? A. Integration B. Subsequent agreement C. Confirmatory memorandum D. Part performance

Q: Most states' statutes of frauds do not require land leases to be in writing unless they: A. involve more than two parties. B. are ancestral property. C. are going to be sold permanently. D. are for a year or more.

Q: Why is the contract for the insurance of a building not covered within the real estate provision of the statute of frauds? A. It does not involve the transfer of interests in land. B. It involves a physical asset. C. It involves two or more parties. D. It need not be in writing.

Q: An oral contract for the sale of land that has been completely performed by the vendor: A. is part of the statute of frauds. B. can be enforced without any writing. C. needs to be signed by the parties. D. has to be testified by witnesses.

Q: Big Bank is a major creditor of Bonwill Department Store. After a major loss in profits due to poor holiday sales, Big Bank decides to help keep Bonwill from bankruptcy. Big bank orally promises Mary Tudor, a supplier to Bonwills, that it will guarantee Bonwill's payment for goods that Mary sells to Bonwill. Most likely, Big Bank's oral agreement: A. is unenforceable under the statute of frauds. B. is unenforceable because it is a collateral contract. C. is enforceable under the "main purpose" or "leading object" exception to the statute. D. is enforceable because a collateral contract is not covered under the statute of frauds.

Q: Jerry and Louise contract for Jerry to sell Louise his farm for $300,000. As part of the deal, Jerry throws in a pound of marijuana seeds, for which Louise is to pay an extra $1000. Louise's plan is to use the seeds to grow a marijuana crop. Is the whole contract or any part of the contract enforceable? Assume that both the sale of marijuana seeds and the cultivation of a marijuana crop are illegal.

Q: Which of the following is true of the statute of frauds? A. It prevents the use of oral evidence to contradict the terms of a written contract. B. It applies to all contracts having consideration valued at $500 or more. C. It requires the independent promise to pay the debt of another to be in writing. D. It applies to all real estate leases.

Q: Describe the three criteria that need to be fulfilled to enforcing a noncompetition clause.

Q: Jan opens a sandwich shop across the street from another sandwich shop run by Amy. Amy is disturbed by this competition, and she agrees to pay Jan $5000, in exchange for Jan's promise to quit the business and not to engage in a similar business within ten-mile radius of Amy's business. Is this contract legal and enforceable? Why or why not? If the agreement is not enforceable, how might Jan and Amy restructure it to increase its chances of being legal?

Q: What is an exculpatory clause?

Q: A contract is said to be _____that is, the legal part can be separated from the illegal partif the contract consists of several promises or acts by one party, each of which corresponds with an act or a promise by the other party. A. implied-in-fact B. voidable C. unenforceable D. divisible

Q: If part of an agreement is legal and part is illegal, the courts will: A. declare the entire agreement to be void. B. ask both the parties to ratify the agreement before considering it for evaluation. C. enforce the legal part so long as it is possible to separate the two parts. D. impose punitive damages on both the parties.

Q: Where no separate consideration is exchanged for the legal and illegal parts of an agreement, the agreement is said to be _____. A. unconscionable B. rescind C. indivisible D. adhesive

Q: Shoddy, the owner of Shoe Repair, was contemplating retirement. He therefore contracted to sell his business to Pauline Parker. Shoe Repair was located in Hoosierburg, Indiana, which has a population of 5,233. Apart from containing a provision entitling Parker to use the Shoe Repair name for the business, the parties' contract included a clause that prohibited Shoddy from opening any competing shoe repair shop in Hoosierburg for a period of one year from the date of the parties' contract. Two months after the date of the contract (and one and one-half months after the sale of the business to Parker had been completed), Shoddy grew tired of retirement. As shoe repair had been his life's work, he opened up a shoe repair shop in Hoosierburg. Parker has sued him in an effort to obtain an injunction against his operation of the competing business, alleging a violation of the parties' contract. How is the court likely to rule? Explain your reasoning.

Q: Wayne and Mia are friends in Idaho, where gambling is illegal and they are aware of it. Wayne and Mia bet $1,000 on which day Paradise Creek will flood its banks. They have no financial interest in Paradise Creek. Wayne wins this bet. Mia pays Wayne the $1,000, but later that day regrets it and sues Wayne to get her $1,000 back. The court would probably rule in favor of: A. Mia, since gambling was illegal. B. Mia, because a bet is considered to a form of an implied-in-fact contract. C. Wayne, because he won the bet fair and square, so the court will enforce the wager. D. Wayne, since the court will "leave the parties where it finds them" in cases like this.

Q: In technical legal terms, a party not equally in the wrong is said to be not in _____. A. res ipsa loquitur B. ab initio C. pari delicto D. ad idem

Q: Joe is the owner of the restaurant "Yummy Bites." Neil is an employee of a competitor's restaurant "Mom's Kitchen." Joe pays Neil $1000 to obtain recipes from "Mom's Kitchen." However later, Joe has second thoughts and forbids Neil to obtain such recipes. Joe wants to get his money back. Identify the most accurate statement that might help Joe. A. Joe can recover the amount because he has rescinded the contract before any illegal act has been done by Neil. B. Joe cannot recover the amount because he has entered into an illegal contract. C. Joe cannot recover the amount because such contracts are unenforceable and illegal. D. Joe can recover the amount because the contract between him and Neil is a quasi-contract.

Q: Amy is hired by BigMart as a cashier. At the time of hiring, Amy is required to sign an arbitration agreement under which she agreed to settle any and all claims she might have relating to her employment by final and binding arbitration before a neutral arbitrator and in accordance with BigMart's "Dispute Resolution Rules and Procedures" which is a separate ten-page document containing complex procedural details. Under the agreement, Amy is required to pay for all arbitration-related costs, and BigMart can still sue Amy in civil court for claims arising from her employment. A court will most likely view this agreement as: A. unenforceable since it is a quasi-contract. B. enforceable because it is an arbitration agreement. C. unconscionable because it is an adhesion contract that is oppressive. D. enforceable because it is part of a valid employment agreement.

Q: To determine _____ unconscionability, courts will scrutinize the contract terms themselves to determine whether they are oppressive, unreasonably one-sided, or unjustifiably harsh. A. procedural B. voidable C. substantive D. associative

Q: A _____ is a contract, usually on a standardized form, offered by a party who is in a superior bargaining position on a "take-it-or-leave-it" basis. A. quasi-contract B. contract of adhesion C. executory contract D. bilateral contract

Q: Toby, an Ohio real estate broker, misrepresented to Allen that Toby was licensed in Michigan under Michigan's statute regulating real estate brokers. Allen signed a standard form listing contract agreeing to pay Toby a 6% commission for selling Allen's home in Michigan. Toby sold Allen's home. Under the circumstances, Allen is: A. not liable to Toby for any amount because of the rule of mirror image which needs to be fulfilled for creating a binding contract. B. not liable to Toby for any amount because Toby violated the Michigan licensing requirements. C. liable to Toby only for the value of services rendered under the quasi-contract theory. D. liable to Toby for the full commission under the promissory estoppel theory.

Q: Which of the following is a possible example of procedural unconscionability? A. A clause excluding a seller's liability for consequential damages from a defective good. B. A clause imposing a penalty for failure to deliver the goods on time. C. A high price term in a contract. D. A fine-print price term in a contract.

Q: Courts may decline to enforce unconscionable terms or contracts. This provision has been laid down in: A. Section 12 of UCC. B. Section 208 of UCC. C. Section 4 of UCC. D. Section 208 of Restatement (Second) of Contracts.

Q: Which of the following is an example of substantive unconscionability? A. Terms that are stated in "fine print" B. A disparity in bargaining power between the parties C. High-pressure sales tactics D. Unjustifiably harsh terms

Q: Under the doctrine of _____, courts would refuse to grant the equitable remedy of specific performance for breach of a contract if they found the contract to be oppressively unfair. A. unconscionability B. mirror image C. community-of-interest D. contract bar

Q: Which of the following is most likely to be done by a court if it finds that a contract or a term in a contract is unconscionable? A. It will refuse to enforce the entire agreement. B. It will impose punitive damages on the guilty party. C. It will allow the injured party to recover damages. D. It will ask for arbitration in the matter.

Q: _____ is generally taken to mean the absence of meaningful choice together with terms unreasonably advantageous to one of the parties. A. Unconscionability B. Illegality C. Adhesion D. Rescission

Q: An agreement that unreasonably tends to interfere with family relationships will be considered _____. A. implied-in-fact B. valid C. exculpatory D. illegal

Q: Agreements made by unmarried people who are living together: A. are unenforceable regardless of their nature. B. are enforceable if they do not involve the division of property. C. are unenforceable if one of the parties is married to someone else. D. are considered to be against public policy.

Q: Which of the following was NOT taken into account by classical law in assessing contracts? A. Fraud B. Duress C. Misrepresentation D. Fairness

Q: A(n) _____ clause is a provision in a contract that purports to relieve one of the parties from tort liability. A. exculpatory B. implied-in-fact C. quasi D. expressed

Q: An exculpatory clause that protects a person from liability for fraud is: A. valid but unenforceable. B. valid if it is in writing. C. against public policy. D. valid if both parties agree.

Q: Which of the following is true regarding an exculpatory clause? A. It is illegal in nature. B. It is also termed a "release." C. It is invalid in negligence cases. D. It imposes strict liability on the guilty party.

Q: Which of the following is also termed a "liability waiver"? A. exculpatory clause B. nondisclosure agreement C. confidentiality clause D. noncompetition clause

Q: Which of the following constrains the employee from divulging or using certain information gained during his employment? A. nonsolicitation agreement B. nondisclosure agreement C. noncompetition clause D. deed of trust

Q: In which of the following situations is a court is most likely to refuse to enforce a noncompetition clause? A. The clause is not ratified by the employer. B. The employment contract which contains the clause is an implied-in-fact contract. C. The clause restricts employees from engaging in a "common calling." D. The employment contract which contains the clause is a quasi-contract.

Q: Paul is hired by Soprano as a security guard. At the time of hiring, Paul signs an agreement that relieves Soprano from workers' compensation liability. This agreement is most likely: A. enforceable because Paul and Soprano have equal bargaining power. B. unenforceable because it includes intentional torts. C. enforceable so long as the terms of the agreement are conspicuously disclosed. D. unenforceable as a violation of public policy.

Q: Which of the following is NOT a requirement in the enforceability of a noncompetition clause? A. The noncompetition clause must serve a legitimate business purpose. B. The noncompetition clause must be regarding the sale of goods. C. The restriction on competition must be reasonable in time, geographic area, and scope. D. The noncompetition clause should not impose an undue hardship.

Q: Noncompete clauses in contracts: A. are never enforced because they violate anti-trust laws. B. are never enforced because they are unethical. C. are always enforced under the doctrine of "freedom of contract." D. are enforced if found to be reasonable.

Q: Helga owns an insurance business in Idaho. Her clients are all Idaho residents. She later sells her business to Carlos. As part of the deal, the contract contains a noncompete clause that prevents Helga from operating an insurance business anywhere in Idaho, Washington, or Oregon for a period of five years. Six months after this sale, Helga opens an insurance business in Oregon. If Carlos seeks to enforce the noncompete agreement against Helga, will he probably be successful? A. Yes, because this agreement is reasonable. B. Yes, because the clause is not imposing an undue hardship. C. No, because this agreement is not reasonable. D. No, because the agreement is not yet converted into a treaty.

Q: Which of the following statements is true regarding noncompetition clauses in the employment contracts? A. These clauses are illegal. B. Employments contracts with these clauses are voidable. C. These clauses put postemployment restrictions on the employees. D. These clause need to be ratified by the employer.

Q: Roger and Erick make a bet concerning whether a certain rich citizen will die within the next year. Neither party has any economic interest in this person's fate, except for that created by the bet. This agreement is: A. unenforceable if the statutes prohibit wagering agreements. B. unenforceable because it tends toward the commission of a crime. C. unconscionable because it contemplates the destruction of life. D. a valid and enforceable risk-allocation agreement.

Q: Mr. Green enters into a contract with Ms. White to purchase legal ingredients used to perfect an illegal marijuana manufacturing operation. Ms. White refuses to pay the amount owed to Mr. Green and he sues in court. What is the court likely to do? A. Recognize the contract but only allow 50% economic recovery for Mr. Green since his products were used to produce illegal items. B. The court will likely not enforce Mr. Green's contract since it was part of an illegal action. C. The court will likely enforce the agreement if Mr. Green registered the contract with the Secretary of State's office. D. The court will enforce the agreement if Mr. Green has lived in the forum state longer than Ms. White.

Q: Which of the following is most true regarding noncompetition clauses in contracts? A. Such clauses are not used during employment contracts. B. If they have a legitimate business purpose, such clauses will be enforced. C. Such clauses are enforced only for protecting the environment and conserving resources. D. Such clauses help in promoting free trade.

Q: In an employment contract, the noncompetition clause might be the only part of the contract: A. that the parties put in writing. B. that would be valid. C. that would be unenforceable. D. that would be illegal.

Q: If a statute is considered to be _____, the purpose of the legislation is to protect the public against dishonest or incompetent practitioners. A. regulatory B. enforceable C. adhesive D. ancillary

Q: Todd is a licensed real estate broker in Ohio. One of Todd's largest clients, Sun Corp., contracted in writing with Todd to find a purchaser for its plant in New York and agreed to pay him a 6% commission if he was successful. Todd located a buyer who purchased the plant. Unknown to Todd, New York has a real estate broker's licensing statute which is regulatory in nature, intended to protect the public against unqualified persons. Todd violated the licensing statute by failing to obtain a New York license. If Sun refuses to pay Todd any commission and Todd brings an action against Sun, he will be entitled to recover: A. nothing. B. a fee based on the actual hours spent. C. the commission agreed upon. D. out of pocket expenses only.

Q: Sam, a plumber, entered into a contract for $75,000 with Orr, Inc., to perform certain plumbing services in a building owned by Orr. After Sam had satisfactorily performed the work, Orr discovered that Sam had violated the state licensing statute by failing to obtain a plumbing license. As a result, Orr denied paying any money to Sam. The licensing statute was enacted merely to raise revenue for the state. An independent appraisal of Sam's work indicated that the building's fair market value increased by $70,000 as a result of Sam's work. The cost of the materials which Sam supplied was $35,000. If Sam sues Orr, Sam will be entitled to recover: A. nothing. B. $35,000. C. $70,000. D. $75,000.

Q: Which of the following terms refers to a widely shared view about what ideas, interests, institutions, or freedoms promote welfare of people? A. Void contract B. Public policy C. Implied-in-fact policy D. Express contract

Q: Normally, an illegal contract is: A. a quasi-contract. B. implied-in-fact. C. unenforceable. D. voidable.

Q: A court has held that a certain contract violates public policy. This contract will be treated the same as a(n): A. illegal contract. B. contract between a minor and an adult. C. private contract. D. adhesive contract.

Q: Which of the following is not a category of illegal agreements? A. Agreements that violate statues B. Agreements that violate public policy developed by the courts C. Unconscionable agreements and contracts of adhesion D. Agreements to bring more profit to one party than the other

Q: A contract of adhesion is one that the courts will always enforce because of the strong public policy underlying such contract.

Q: The Uniform Commercial Code (UCC) allows the court to modify or limit the enforcement of a provision in a contract that is found to be unconscionable.

Q: Courts provide remedy for the breach of illegal agreements.

Q: To encourage people to cancel illegal contracts, courts will allow a person who rescinds such a contract before any illegal act has been performed to recover any consideration that he has given.

Q: In order to have any chance of being enforced, an illegal agreement must be indivisible.

Q: When a court says that an agreement is illegal, it most likely means that the agreement: A. has not mentioned a time period for which the agreement is valid. B. does not identify the parties involved in the agreement. C. is related to buying and selling of trade secrets. D. violates public policy.

Q: An agreement to divorce one's spouse is considered to be illegal.

Q: Courts will always enforce an exculpatory clause from a properly executed contract.

Q: Under the doctrine of unconscionability, the courts would refuse to grant the equitable remedy of specific performance for breach of contract if the contract is oppressively unfair.

Q: One example of procedural unconscionability is the use of "fine print" in stating a contractual provision.

Q: The origin of the policy against restrictions on competition in the market comes from common law.

Q: A noncompetition clause is also known as a "liability waiver."

Q: An exculpatory clause is a provision in a contract that purports to relieve one of the parties from tort liability.

Q: A court will enforce a noncompetition clause even if its restraints are unduly burdensome either on the public or on the party whose ability to compete would be restrained.

Q: An agreement can be illegal even if no statute specifically states that such an agreement is illegal.

Q: Public policy never changes and is constant for judges to rule on.

Q: For a noncompetition clause to be enforceable, the clause must serve a legitimate business purpose.

Q: Any contract that is deemed illegal is also a criminal violation.

Q: Even if both parties consent to an agreement, if a court finds the agreement illegal then it will not enforce it.