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Exam 8: Contract Formation

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Question 21

Multiple Choice

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Under the UCC, the rules of consideration also do not apply to _____.

A) real estate sales
B) service contracts
C) firm offers
D) employment contracts
E) an option

F) A) and D)
G) None of the above

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Question 22

True/False

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When there is a mutual mistake as to a material fact inducing a contract, rescission is inappropriate.

A) True
B) False

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Question 23

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The Uniform Commercial Code (UCC) applies to individuals as well as firms.

A deposited acceptance creates a binding contract even if there is a revocation in the mail.

A(n) _____ beneficiary is a third party who unintentionally benefits from a contract.

A minor can disaffirm the contract and legally recover any consideration that has been given to an adult, even if the minor cannot return the adult's consideration disaffirm

Which of the following terms refers to a person's ability to be bound by a contract?

If a debtor overpays a creditor $5,000, the debtor can force the creditor to return that amount by suing under quasi-contract.

Contract law applies to:

Promissory estoppels often is used to prevent a party who has made a unilateral offer from withdrawing the offer after the requested work has begun.

Allan promises to pay $400 to Waker if he can steal the next day's test paper from their professor. That night, Waker steals the paper and brings it to Allan. Allan, who is now worried about being caught, tells Waker he does not want the test paper and refuses to pay him the $400. Has Allan breached the contract between him and Waker?

A(n) _____ contains a specific promise and a specific demand.

Barney takes his wife Betty to a Porsche dealership and tells her to pick out whichever car she wants as a birthday present. She chooses a red Boxter. Barney negotiates a price with the dealership and signs a contract paying cash for the car. Barney repeatedly tells the dealer that the car is a gift for his wife. The car is to be serviced and picked up at 10:00 a.m. the next morning. Barney dies that night. When Betty arrives at the dealership to get the car, they refuse to give it to her because only Barney signed the contract.

Brett offers to sell his old, but working, cell phone to James for $65. James says he will accept the offer if Brett lowers the price to $60. James has:

The doctrine of part performance creates an exception to the requirement that sales of interests in land must be in writing.

A(n) _____ contract is one that appears to be an agreement but lacks an essential requirement for validity and enforceability.

Fred takes Betty to dinner at a very expensive and exclusive restaurant. The menu does not mention the prices. The server takes their order and both Fred and Betty enjoyed the meal immensely. When the bill comes, Fred refuses to pay because the menu had no prices and because he and the server never engaged in language indicating an offer and acceptance. The server said, "Are you ready to order" and when Fred said "yes", the server merely asked, "What may I get you tonight"?

A teacher's promise to pay $5.00 if a student to go to her office to get her some chalk is an example of a unilateral contract.

Ptomaine is a chef who has opened a new restaurant. He agrees with Bob, a baker, that Bob will deliver 10 dozen hamburger and hotdog buns each morning at 6:00 a.m. as long as he doesn't call to cancel the next morning's delivery by 6:00 p.m. the evening before. This goes on for about ten days when Ptomaine realizes at 10:00 p.m. one evening that he has a surplus of buns. At 6:00 a.m. the next morning he refuses to accept the morning delivery. Discuss, with reference to common law, whether a contract exists.

Sarrah agrees to sell her house to Tiffany for $300,000. Tiffany replies that she will be glad to buy the house at $300,000, and asked if the price included the furniture. Sarrah replied that the furniture was not included. Tiffany agreed to pay $300,000, but Sarrah demanded $350,000, stating that Tiffany's counteroffer terminated the earlier offer. Discuss the case.