2021-fall-quiz-1-q-s.

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2. A purchaser contracted in writing to purchase inventory from a supplier for $1,000. After
making the agreement, the supplier saw that the cost of raw materials had greatly
increased. The supplier emailed the purchaser and asked if she would agree to instead pay
$1,200 for the inventory. The purchaser responded with a signed email agreeing to the
increased cost. Unbeknownst to the supplier, the purchaser was heavily intoxicated when
she sent the return email and did not understand to what she was agreeing.
If the purchaser later seeks to prevent enforcement of the amended contract price, is she
likely to succeed?
Answer option D (No, neither the preexisting duty rule nor the woman's intoxication will
prevent enforcement.)is correct.
Here, the supplier asked for an additional $200 for the inventory. Under the preexisting duty
rule, this request would normally be unenforceable because the supplier was already
contractually obligated to deliver the inventory for $1,000. However, the UCC rejects the
preexisting duty rule for the sale of goods. Therefore, the modification to the contract will
be enforceable. Note that the supplier might also have an argument for modification based
on unforeseen circumstances due to the increase in the price of raw materials, although this
argument would depend upon whether such a change in circumstances was anticipated or
not.
The supplier did not know or have reason to know that the purchaser was intoxicated when
she agreed to the modification of the contract, so the purchaser's intoxication will not serve
as a defense to enforcement of the contract.
3. A man helped his brother paint the brother's house. The brother's house was large, so the
job took all weekend to complete. The next weekend, the man called his brother and asked
whether he could help the man's girlfriend move apartments. His brother responded, "Sure,
I owe you for helping me paint my house last weekend." The brother helped the man's
girlfriend move, which took only two hours.
What is the best explanation for why there is not a contract between the man and his
brother?
Answer option B (The brother's promise to help the man's girlfriend move was made after
the man already had helped paint his brother's house.) is correct. Consideration exists when
something of value is exchanged in a bargain. However, past consideration will not result in
an enforceable contract. Past consideration is any consideration that already was given
before the contract was formed
4. A man offered to sell his motorcycle to his neighbor for $10,000. The neighbor was
interested but wanted additional time to think about it. The man promised his neighbor that
he would leave the offer open for a year.
Is the man legally obligated to leave the offer open for a year?
Answer option A (No, because there is no consideration.)is correct. There are two common
types of offers that may not be revoked by the offeror: option contracts and firm offers.
Option contracts are created when the offeror keeps an offer open for a limited amount of
time, in exchange for the offeree's consideration. A firm offer is a signed writing by a
merchant who deals in goods, explicitly assuring the offeree that an offer to buy or sell
goods will be held open for a limited amount of time. Firm offers do not require
consideration, but must be in a signed writing, and are irrevocable for a maximum of three
months, even if the specified amount of time is longer.
Here, the man is not a merchant who deals in a particular good. He is offering to sell his
personal property to a neighbor. Therefore, the rules regarding firm offers do not apply and
the offer should be analyzed under the rules for option contracts. Option contracts require
consideration. The neighbor did not pay any consideration for leaving the offer open for a
year. Therefore, there is not a valid option contract and the man has no legal obligation to
keep the offer open for a year.
5. A woman was considering purchasing an expensive rug from a merchant. The merchant
told her that he would be willing to sell her the rug for $4,000. The merchant told her that
he would leave the offer open for six months if the woman paid him $200. The woman
accepted and paid the merchant. After five months, the woman told the merchant that she
wanted to purchase the rug for $4,000.
Is the merchant obligated to sell the rug to the woman for $4,000?
(A) No, because the promise to leave the offer open was not in a signed writing.
(B) No, because the promise to leave the offer open expired after three months.
(C) Yes, because there was a valid firm offer.
(D) Yes, because there was a valid option contract
(D) Yes, because there was a valid option contract.
6. A woman visited a car dealership and found a convertible that she wished to purchase.
The car was selling for $30,000, but the woman did not have enough money at the time to
buy it. The dealer, seeing how badly the woman wanted the car, provided her with a signed
writing stating that the dealer would sell the convertible to the woman for $30,000 and that
the woman could email the dealer anytime within the next five months to accept the offer.
Four months later, the dealer emailed the woman revoking the offer. The woman
immediately replied, accepting the terms of the signed writing and arguing that her
acceptance was valid because she still had one month to accept. The next day, the woman
returned to the dealership to pay for the convertible. The dealer refused to sell her the car,
arguing that the offer was revoked and that he never received her acceptance email, even
though it was sent to the correct email address.
Which of the following best states the legal status of the contract between the woman and
the dealer?
(A) There is a valid contract at the time the woman sent the reply email, because the dealer
was not entitled to revoke the offer for five months, and the woman's reply email was an
effective acceptance within that time.
(B) There is a valid contract at the time the woman tendered payment, because the dealer
was not entitled to revoke the offer for five months, and the woman's tender of payment
was an effective acceptance within that time.
(C)There is not a valid contract, because the dealer successfully revoked his offer before the
woman accepted.
(D)There is not a valid contract, because absent consideration, the offer terminated by lapse
of time after the woman left the dealership, and there was no need for the dealer to revoke
an offer that had already terminated.
(C) There is not a valid contract, because the dealer successfully revoked his offer before the
woman accepted.
7. An uncle told his nephew, who was planning to take a job at a brokerage firm after
college, that the uncle wanted to buy him his first briefcase. The uncle told the nephew to
go buy himself "the best briefcase that money can buy" and to send the receipt to the uncle
so that the uncle could reimburse the nephew for the cost. The nephew ordered a designer
leather briefcase that cost $3,000, which the nephew charged on a credit card. This was a
high-end briefcase but not the best one available. When the nephew sent the receipt to the
uncle, the uncle immediately told the nephew that he had changed his mind and couldn't
afford to buy the nephew a briefcase. The nephew called the vendor to cancel the order but
was told that he would only receive a $2,800 refund due to the vendor's nonrefundable
$200 restocking fee for order cancellations.
If the nephew sues the uncle to enforce his promise, how much, if anything, would a court
likely award the nephew?
(A) $3,000.
(B) $200.
(C) The price of the best briefcase on the market.
(D) Nothing.
(B) $200.
8. A woman asked a friend to paint the woman's house. The woman knew that the friend
owed several thousand dollars on her credit card, so the woman offered to pay off her
friend's debt in exchange for the friend painting her house. The friend signed an agreement
that she would paint the woman's house the following weekend, barring any rain. If it rained
the following weekend, the friend would instead paint the house on the next weekend
when it did not rain.
Is there a valid contract between the woman and her friend?
(A) Yes.
(B) No, but only because the friend had a preexisting duty to pay off her credit-card debt.
(C) No, but only because the friend's promise was illusory.
(D) No, both because the friend had a preexisting duty to pay off her credit-card debt and
because the friend's promise was illusory.
(A) Yes.
9. A group of friends attended a party. One man attempted to discard empty beer cans by
throwing them into the trash can across the room. The man had terrible aim and missed all
of his shots. One of the man's friends shouted to him, "I'll give you $20 if you can sink the
next one you throw." The man did not throw any more beer cans the rest of the night. A
week later, the friends attended another party at the same location. The man picked up an
empty beer can and successfully threw it into the trash can across the room.
Which of the following best describes the validity of the friend's offer?
(A) The offer was never valid, because it was clearly intended as a joke.
(B) The offer was never valid, because its terms were not reasonably certain.
(C) The offer was valid but expired shortly after it was made.
(D) The offer was valid, never expired, and was accepted by the man.
(C) The offer was valid but expired shortly after it was made.
10. A buyer mailed a signed order to a seller that read: "Please ship us 10,000 widgets at
your current price." The seller received the order on January 7 and that same day mailed to
the buyer a properly stamped, addressed, and signed letter stating that the order was
accepted at the seller's current price of $10 per widget. On January 8, before receipt of the
seller's letter, the buyer telephoned the seller and said, "I hereby revoke my order." The
seller protested to no avail. The buyer received the seller's letter on January 9. Because of
the buyer's January 8 telephone message, the seller never shipped the goods. Under the
relevant and prevailing rules, is there a contract between the buyer and the seller as of
January 10?
A: No, because the order was an offer that could be accepted only by shipping the goods;
and the offer was effectively revoked before shipment.
B: No, because the buyer never effectively agreed to the $10 price term.
C: Yes, because the order was, for a reasonable time, an irrevocable offer.
D: Yes, because the order was an offer that seller effectively accepted before the buyer
attempted to revoke it.
D
11. An accountant placed an order with a silkscreen printer for 200 computer bags to be
printed with the accountant's firm name and logo, at a cost of $2,000. The printer gave the
accountant an invoice for future payment. Neither party signed the invoice. A week later,
when the printer had already completed 90 computer bags, the printer sent a sample bag to
the accountant. The accountant called the printer and said, "I know we had an agreement,
but please cancel the order."
If the printer sues the accountant for payment, which of the following facts will likely be
dispositive?
(A) The accountant received and accepted the sample.
(B) The agreement was memorialized in a writing.
(C) The accountant admitted that they had an agreement.
(D) The seller completed almost half the order before the accountant canceled the order.
(D) The seller completed almost half the order before the accountant canceled the order.
12. A man paid a company to construct a large apartment complex on his property. The
company contracted with a subcontractor to install appliances in the building. After one
year of construction, when the apartment complex was mostly completed, the company
started experiencing financial difficulties. The subcontractor, afraid that the company would
not be able to pay for the appliances, asked the man to guarantee payment in the event
that the company was unable to pay. The man was concerned that the apartment complex
would not open in time if the appliances were not delivered and installed as scheduled,
which would cause him significant financial loss. The man orally promised the subcontractor
that he would pay for the appliances if the company defaulted on its obligation to pay for
them. The subcontractor delivered and installed the appliances. The company declared
bankruptcy and did not fully pay the subcontractor.
What rationale best explains why the man's promise to pay the subcontractor is
enforceable, despite the Statute of Frauds?
(A) Although the apartment complex took over a year to complete, it was not impossible to
complete construction in under a year.
(B) The appliances were already received and accepted.
(C) The man would have suffered significant financial loss had the appliances not been
delivered and installed as scheduled.
(D) The subcontractor incurred a detriment by making significant improvements to the land
by installing the appliances.
(C) The man would have suffered significant financial loss had the appliances not been
delivered and installed as scheduled.
13. A man told his neighbor that he had always admired her car. The neighbor told the man
that she would sell him the car for $10,000, and that she would keep the offer open for one
week if the man gave her $100. The man did not have any money at the time, but he stated
that he would deliver the $100 later that day. The man did not deliver the payment that
day, and the next day the neighbor received and accepted an offer from a different buyer.
Two days later, when the man attempted to give the neighbor the $100 payment, the
neighbor told him that she had already sold the car.
If the man sues the neighbor for breach of contract, is he likely to be successful?
(A) Yes, because the man provided the agreed-upon consideration within a reasonable time.
(B) Yes, because the neighbor's offer was irrevocable for one week.
(C) No, because an option contract must be in writing.
(D) No, because the man did not provide the required consideration to keep the neighbor's
offer open.
(D) No, because the man did not provide the required consideration to keep the neighbor's
offer open.
14. In the context of contract formation, an offer is valid only if its terms are which of the
following?
(A) Reasonable.
(B) Objectively clear.
(C) Reasonably certain.
(D) Fair.
(C) Reasonably certain.
15. A company offered a woman a job contract. The contract specified the woman's duties,
salary, benefits, holidays, start date, and other material terms. The woman responded to
the company by saying that she accepted its offer but wanted one extra week of vacation
time per year.
Has the woman accepted the company's offer?
(A) Yes, because the request for an extra week of vacation time will be treated as a proposal
for an addition to the contract, not a counteroffer.
(B) Yes, because the extra week of vacation time is not an essential term of the contract.
(C) No, because the extra week of vacation time materially alters the contract.
(D) No, because the request for an extra week of vacation time will be treated as a
counteroffer, not an acceptance.
(D) No, because the request for an extra week of vacation time will be treated as a
counteroffer, not an acceptance.
16. A brother told his sister that he was bored at his job and wanted to fund a business
venture with her. The sister was thrilled, because she had been out of work for a long time
and wanted to earn some money. She spent several months looking into business
opportunities in her free time, at which point the brother told her that he had changed his
mind and decided not to fund any venture with the sister.
If the sister wishes to bring an action against the brother, which theory of recovery, if any,
would be most advisable for the sister to pursue?
(A) Breach of an enforceable unilateral contract.
(B) Breach of an enforceable bilateral contract.
(C) Promissory estoppel.
(D) No theory of recovery is likely to be successful, because a promise to make a gift is not
enforceable in these circumstances.
(D) No theory of recovery is likely to be successful, because a promise to make a gift is not
enforceable in these circumstances.
17. A lawyer said to a friend's son, "I would love to see you go to law school. The law firms I
know aren't attracting enough people like you." Based on the lawyer's statement, the
friend's son attended law school. The friend's son financed his education with student loans,
believing that the lawyer was going to help him find a job when he graduated. Upon
graduation, the friend's son asked the lawyer to help him find a job, but the lawyer refused.
The friend's son considered whether he might prevail in getting the lawyer's assistance by
bringing an action based on promissory estoppel.
Of the three elements of promissory estoppel—a promise, justifiable reliance, and a
detriment—which element or elements are satisfied here?
(A) A promise, justifiable reliance, and a detriment.
(B) Only justifiable reliance and a detriment.
(C) Only a detriment.
(D) Only justifiable reliance.
(C) Only a detriment.
18. A professional athlete and a graphic designer agreed that the designer would create a
private-label logo for the athlete's line of sportswear.
Under the Second Restatement of Contracts, which of the following is necessary for the
parties to form a contract?
A A written agreement.
B Consideration.
C The payment of money.
D An exchange of promises.
Answer option B is correct
19. A homeowner claimed that there was a valid offer to paint her house.
Which of the following statements would a court most likely find constituted a valid offer?
A"I offer to pay you to paint my house."
B"I will pay you $1,000 to paint my house."
C"I might pay you $1,000 to paint my house."
D"I will not pay you more than $1,000 to paint my house."
Answer option B is correct.
20. A man called the pastor of his church and explained that he wished to donate $10,000 to
the church. The pastor thanked the man for the generous donation and said that he would
be awaiting the check. The man then rechecked his finances and realized that $10,000 was
more than he could comfortably donate.
Is the man contractually obligated to donate $10,000 to his church?
A) Yes, because there was an offer and acceptance.
B) No, because the man's realization that he could not donate the $10,000 indicates a lack
of intent to be legally bound.
C) No, because the agreement was not in writing?
D) No, because there was no mutual consideration.
D) No, because there was no mutual consideration.
21. A man went to a jewelry store and saw a watch that he liked. He told the salesman that
he would be willing to buy the watch for $1,000. The salesman told the man that he was not
willing to sell the watch for $1,000 but that he would sell it for $1,200. While the man was
still deciding whether to purchase the watch for $1,200, the salesman decided that he
would be willing to sell it for $1,000 after all. The salesman told the man, "I accept your
offer to purchase the watch for $1,000."
Is the salesman's acceptance valid?
A) No, because the man's initial proposal to buy the watch for $1,000 was only a
preliminary negotiation, not an offer.
B) No, because the man's offer to buy the watch for $1,000 terminated when the salesman
offered to sell it for $1,200.
C) Yes, because the man's initial proposal to buy the watch for $1,000 was a valid offer that
was never revoked.
D) Yes, because the offer to buy the watch for $1,000 constituted an irrevocable firm offer.
B) No, because the man’s offer to buy the watch for $1,000 terminated when the salesman
offered to sell it for $1,200.
22. The owner of a stationary bicycle wrote a letter to her friend offering to sell her
stationary bicycle to him for $150. The friend received the letter on January 18. On January
19, he mailed a letter back saying that he was not interested in purchasing the bike because
he had just purchased a gym membership. However, the friend changed his mind the next
day and mailed a letter to the owner accepting her offer to sell the bicycle and enclosing a
certified check for $150. The owner received the friend's rejection letter on January 21 but
put it aside without reading it. The next day, she received the friend's acceptance letter,
which she opened and read immediately.
No, because the mailbox rule does not apply—whichever is received first controls.
23. On November 5, an electronics store owner realized that his stock of 15 copies of the
most popular video game of the holiday shopping season would not last until the first of the
next month. Seeing an advertisement from the manufacturer of the game in a trade journal
listing its price at $3,000 per hundred, with delivery one week from order, the store owner
e-mailed to the manufacturer an order for 100 copies of the game at $3,000 per hundred.
There were no further communications between the store owner and the manufacturer. By
November 25, the store owner realized that the manufacturer was not going to deliver any
of the video games. He thus was forced to obtain additional stock by purchasing from a
middleman at a cost of $4,000 per hundred. The store owner brings an action for breach of
contract against the manufacturer.
Who will prevail?
The manufacturer, because it never accepted the offer contained in the store owner's e-
mail.
24. A young man proposed to his girlfriend, but she was reluctant because of his meager
income and lack of job potential. The young man told his father about her reluctance. The
father told the girlfriend that if she married his son, he would support them for six months
and send his son to a six-month computer technology training school. This was sufficient to
dispel her reservations and the two were married very soon after. When they returned from
their honeymoon, the father refused to go through with his offer. Although the girlfriend is
happy in her marriage, she sued the father for damages.
If the father prevails, what is the likely reason?
the contract was oral
25. Which of the following will be legally binding on all the parties despite the lack of
consideration?
-A promise to donate money to a charity which was relied upon by the charity in incurring
large expenditures.
-An oral employment agreement for a term of nine months from the date the agreement
was formed.
-An irrevocable oral promise by a merchant to keep its offer open for 60 days.
-A material modification signed by the parties to a contract to purchase and sell a parcel of
land.
ANS: A promise to donate money to a charity which was relied upon by the charity in
incurring large expenditures.
26. A man knew that his neighbor frequently earned extra money by mowing lawns in the
area. The man slipped a note under the neighbor's door which said, "If you will mow my
lawn, I will pay you $25." The neighbor mowed the man's lawn the next day, but the man
refused to pay the $25. Which of the following is correct about the relationship between the
man and the neighbor?
The neighbor's mowing of the lawn created a unilateral contract.
27. On March 7, a widget retailer sent to a widget manufacturer a written purchase order
for "1,000 widgets at the current wholesale price." On March 9, the manufacturer received
the order, and it replied the next day by fax to confirm that the order had been received and
would be shipped on March 12. The price on the confirmation was $50 for each widget,
which was the current wholesale price. Upon receiving the fax, the retailer replied by fax,
"Cancel my previous order for 1,000 widgets." Was an enforceable contract in effect
between the woman and the manufacturer?
Yes, because the manufacturer's fax of March 10 constituted an acceptance of the retailer's
offer.
28. A man sent a letter to a woman promising to sell her his motorcycle for $1,000. Upon
receipt of the letter, the woman sent a fax to the man that said, "The price is a little high, I'll
give you $800." The man replied by fax that he would not accept $800. The next day, the
woman telephoned the man and said she would pay $1,000 for the motorcycle. The man
refused to sell the motorcycle to the woman. If the woman sues the man for breach of
contract, which of the following would be the man's best defense?
The woman's counteroffer terminated her power of acceptance.
29. On May 2, a woman mailed the following letter to a man: "May 1: I have two tickets to
the concert on July 1 at the auditorium in town. I'll sell them to you for $60 per ticket. You
have 15 days from the day given above to decide whether to accept this offer." The man
received the letter on May 4 but did not read it until May 6. On May 18, the man went to
the woman's home and attempted to accept the offer. The woman replied that she had
already sold the tickets. If the woman's letter created in the man a valid power of
acceptance, was that power terminated by lapse of time before the man went to the
woman's home on May 18?
Yes, because the letter was dated May 1.
30. After the murder of his brother, a man published the following notice in the local
newspaper: "REWARD - Any person who supplies information leading to the arrest and
conviction of the murderer of my brother will be paid $10,000." An amateur detective,
without knowledge of the reward notice, began investigating the matter as a result of his
own curiosity. One week later, the detective secured information that led to the arrest and
later conviction of the murderer. During the murder trial, the detective found out about the
reward and demanded the $10,000 from the man. Can the detective succeed in recovering
the $10,000 reward from the man?
No, because the offer was contained in an advertisement.
31. A college graduate was accepted to a prestigious law school. The graduate's proud
father announced, "If you promise to study for a minimum of five hours a day, I will pay you
$1,000 for each 'A" you achieve." Which of the following is accurate regarding the father's
promise to reward the law student for achieving "A's"?
It is enforceable, because a bargained-for exchange was intended.
32. A golfer saw a sign on a golf course indicating that a golf store would pay $5,000 to
anyone who hit a hole-in-one on the first hole. The golfer made a hole-in-one on this hole.
When she went to claim her prize, the store told her that the sign had been left up from a
charity tournament the day before. The prize was meant only for players in the tournament,
and the store had not known the sign was still up. The golfer sued the store for breach of
contract. Will the golfer win her suit for breach of contract?
Yes, because the sign was an offer to make a contract, which the golfer accepted.
33. A man needed to have the oil changed on his car. On Friday, he decided to take his car
to the local dealership to have the oil changed and asked his neighbor if she would give him
a ride home from the dealership. The neighbor said, “Why pay the high prices a dealership
will charge you? I can change the oil in your car for you. If you will agree to pay me $50, I’ll
change the oil in your car over the weekend.” The man readily agreed.On Sunday afternoon,
the man noticed that his neighbor still had not started working on the car. He asked his
neighbor if the car would be ready for him to drive to work Monday morning. The neighbor
replied, “I thought about it and realized $50 is too low a price for the work involved. I don’t
think I’m going to change the oil in your car.” The man then said, “Look, I realize $50 is low
for the work involved. If you can change the oil in my car by tomorrow morning, I’ll pay you
an additional $25. And I won’t sue you in small claims court for your failure to perform your
promise.” The neighbor then changed the oil late Sunday afternoon, but the man refused to
pay to the neighbor anything more than $50.In a suit by the neighbor to recover the
additional $25 promised by the man, the neighbor will
(A) win, because she performed her part of the bargain.
(B) win, because the second contract for $75 superseded the original $50 contract.
(C) lose, because the $75 contract did not supersede the $50 contract.
(D) lose, because the neighbor had a pre-existing duty to change the oil in the car for $50.
D