GOVT 404 Quizzes

GOVT 404 Quiz Mutual Assent to Contract

1. The Electronics Barn publishes an advertisement in the local newspaper. This week’s advertisement includes an advertisement for a television for just $115. The television advertised is actually worth $1,150, and the price in the advertisement was the result of an employee who “thought it would be funny” to run the advertisement “as a joke.”
2. An auction for the sale of goods, without reserve, constitutes what?
3. Xavier is considering hiring Zoe to repair the cracked, leaking foundation of Xavier’s commercial warehouse property. During a meeting, the two agree on the timing, price, and scope of work that would be performed, but they agree that “We won’t have a binding deal until we have put this agreement in writing and we have both signed it.” Xavier asks his lawyer to draft the agreement. However, the lawyer is busy, and does not produce a writing promptly. Under time pressure to get the work started, Xavier tells Zoe to go ahead and start the excavation work, and he assures her that he’ll pay her for the work. Zoe starts working on the excavation.
4. True or False: When applying the “Battle of the Forms” provision of the Uniform Commercial Code, it is never important whether the parties are merchants as defined under the Uniform Commercial Code, since the Uniform Commercial Code applies to all contracts for the sale of goods, even contracts not involving merchants.
5. Which of the following is the best definition of an option?
6. Alexis and Rollie enter into an option contract. The option allows Alexis until Friday, February 17, at 5:00 p.m. to respond to Rollie’s offer to sell Alexis 500 shares of his stock in Rollie Corporation for $35,000. Alexis meets with family members to discuss the investment opportunity. After getting wise counsel on whether she should buy the stock at that price, she decided to exercise her option and buy the stock. On February 16, she writes a letter to Rollie, indicating her willingness to pay $35,000 for the stock, and encloses a check in the amount of $35,000. She puts the letter and check in a properly addressed, postage-paid, envelope, and places the envelope in the mail on Thursday, February 16. Rollie receives the envelope on Saturday, February 18. Choose the best answer.
7. On February 11, Lawrence sends a letter via first-class mail to Protein Source, Inc., offering to buy 225 bags of animal feed from Protein Source, Inc., at a total price of $1,000. Protein Source, Inc., responds by mailing a letter, via first-class mail, on February 12, indicating that Protein Source, Inc., is not interested in selling animal feed at the price offered by Lawrence. The letter is received by Lawrence on February 14.
8. Danielle is the office manager for an insurance brokerage. The company’s parking lot needs to be sealed and repainted. She calls Jasper, who owns an asphalt sealing and painting company, and says, “Hi, can you tell me what you usually charge to seal and paint parking lots?” Jasper responds with the amount, per square foot, that his company charges for painting and sealing. Does Jasper’s response constitute an offer?
9. Which of the following is not a necessary element for a rm offer under the Uniform Commercial Code?
10. Driveaway is a used-car dealership. It publishes an offer in the local newspaper that promises that Driveaway will sell a 2013 pickup truck, valued at $28,000, for $20,000, to the “first customer who walks through our door on Monday morning with $20,000 in cash!” The ad runs in the Friday edition of the newspaper. If Driveaway wants to revoke its offer, what should it do?
11. Three identical, adjacent, undeveloped residential real estate parcels are for sale in a new housing development. Lots 1 and 2 are owned by Pender. Lot 3 is owned by Cathleen. Pender and Cathleen are at a community event together. Brice is a real estate investor who happens to meet Pender and Cathleen at the event. He offers to purchase Lot 3 from Cathleen, who says his offer is too low for her to consider. Pender, however, tells Brice that he accepts Brice’s offer.
12. True or false: A contract must identify the terms of the agreement with enough detail so that a court will have a reasonable basis for determining if a breach of contract has occurred and, if it has, what remedy is appropriate.
13. If an offeror and offeree enter into a valid option contract, the offeree will retain the power of acceptance during the option period, unless:
14. Randy makes an offer to Ellen that requires acceptance by performance. When is Ellen’s acceptance effective?
15. Elise, a human resources manager for a company, interviews Gretchen, a prospective employee, on Monday. The evening after the interview, Elise calls Gretchen and offers her a position with the company, describing the position, salary, and benefits. During the telephone conversation, Gretchen asks Elise where her office would be located in the company’s office suite, if she decided to accept the offer. Elise tells Gretchen that she is no longer interested in hiring Gretchen, and hangs up. Choose the best answer:
16. On Monday, Rex makes an offer to Dante by email. The email says the offer will expire Friday at 5:00 p.m. Choose the best answer:
17. Rudolph and Bonita meet to discuss a contract for Rudolph to design a new living room in Bonita’s home. Rudolph looks at the house, sketches out some ideas, and says he will provide her with detailed design plans if Bonita will pay him $3,500 once the plans are complete. Bonita, intending to make a contract, shakes Rudolph’s hand and indicates that she “can’t wait” to see his designs. Choose the best answer:
18. Zolton is a human resources manager at a medical device manufacturing company. He interviews Trenton for a position as a salesperson. He offers to hire Trenton for a 6-month contract term that will pay him a base salary plus a bonus in the amount of 1.5% of Trenton’s total monthly sales, payable at the end of each three- month period that Trenton is employed. Trenton responds by saying, “I’d just need those bonuses to be paid monthly, instead of every three months—but otherwise that sounds good to me.”
19. Manufacturer offers to pay Consultant a single payment in exchange for manufacturing-process consulting services. Manufacturer and Consultant negotiate back and forth over the course of a week, without either party accepting the other’s final offer. When the offeree responds to the offeror’s last offer by beginning performance, what rule dictates what the terms of the contract are?
20. Renata writes an offer to sell real estate to Max. She puts the offer in an envelope and mails it to Max’s office. Max opens the envelope, reads the letter, and decides that he will accept the offer. He then exclaims, there, alone in his office: “I’m going to buy Renata’s property! Yes!” Next, he writes out a note on Renata’s letter, as follows: “I accept.” He then signs his name below his note. Last, Max puts the letter in an envelope and mails it back to Renata, who receives it two days later. When was Max’s acceptance effective?
21. Which of the following events does not terminate an offeree’s power of acceptance?
22. A retailer of home-cleaning products instructs its salespeople to make sales of its product by visiting residences of prospective customers during the day. One salesperson visits a prospective purchaser’s residence, finds nobody answering the door, and leaves a box of assorted cleaning products at the door together with a note that says: “Please make payment in the amount of $350 within 10 days. If you do not return the products within 24 hours you will be deemed to have agreed to purchase them.” If 24 hours expire and the customer has not returned the box of cleaning products, does the customer’s silence alone constitute acceptance of the offer to purchase the cleaning products? Explain your answer.

GOVT 404 Quiz Contract Defenses Assent-Based Defenses

1. Richard owns a 30-acre parcel of real property valued at $200,000. Richard suffers from a mental health condition that sometimes impairs his volitional capacity but not his cognitive capacity. On one occasion, when suffering an episode of this sort, he sells the property to Watson for $125,000. Prior to closing, Richard seeks to avoid his contractual obligation to sell the property to Watson. Which of the following facts would Watson be most likely to assert in his argument that the contract is not voidable?
2. Ellis is a salesperson for a farm equipment dealer. He’s worked for the employer Plow-Share LLC for three years and has been very successful. His manager, Davis, tells Ellis that he’d like to give him a promotion to regional sales manager and include a 10% raise as part of the deal. Ellis has been thinking about going to work for another farm equipment dealer, Green Tractor Innovations (GTI), and he has had some preliminary discussions with GTI about taking a job with them. During the negotiations with Plow-Share, Ellis tells Davis, “I’ll sign a one-year agreement with Plow-Share LLC if you’ll give me a 30% raise and a company car. If not, I’m going to work for GTI, and I think you’ll regret letting me get away to a competitor.” If Ellis’s comments convince Davis to agree to a 30% raise, does Davis have a likely basis for avoiding the contract?
3. Lawrence contracts with Arnold to sell Lawrence’s classic automobile to Arnold for $40,000. Arnold pays a $10,000 down payment, and agrees to pay the $30,000 balance at the time he take possession of the car. However, Arnold learns, after paying the down payment to Lawrence, that the Lawrence falsely represented that he owned the car, when, in fact, Lawrence does not own the car. Assume Arnold is only interested in getting his $10,000 and having no further dealings with Lawrence or the car he offered to sell Arnold. Explain what you think the best argument is for Arnold, and be sure to include the legal theories and rules that justify your position.
4. Bobbie is 17 years old. He looks considerably older than his age; in fact, most people would guess that Bobbie is about 25. Bobbie also has a maturity that is unusual for someone his age. Further, he has been running a small but successful Internet branding and advertising business from his bedroom for the past two years, so he has also developed more business sense than most of his peers. Bobbie approaches a small-business owner, Ian, who has owned restaurants for 25 years, about providing Internet marketing services for Ian’s three restaurants for the next 12 months. After contracting with Bobbie, Ian learns Bobbie’s age. Ian feels embarrassed that he’s just contracted for an important business matter with a teenager. Choose the best answer:
5. The case of Wood v. Boynton involved the sale of a stone for a small sum. The stone turned out to be a diamond. The seller raised the defense of ________________, and this defense ____________, because the seller knew that there was uncertainty about the quality of the stone.
6. Which of the following is not a required element of the defense of unilateral mistake?
7. Del offers to sell his 100-acre parcel to Jim for $1,000,000. Jim thinks the price is high, but speculates that a new housing complex might be developed on the parcel adjacent to Del’s parcel. If that happens, Del’s parcel will be sought after for development purposes. Jim, predicting that the adjacent parcel will be developed, decides to buy Del’s parcel for $1,000,000 despite the high price. After signing the contract, Jim learns that there are no plans by any developers to develop the adjacent parcel in the foreseeable future. Jim wants to avoid his contractual obligation to buy the parcel using the doctrine of unilateral mistake. Will the circumstances constitute a mistake?
8. In order for a fraudulent assertion to induce a party to agree to the terms of a contract, the assertion must
9. Bobbie is 17 years old. He looks considerably older than his age; in fact, most people would guess that Bobbie is about 25. Bobbie also has a maturity that is unusual for someone his age. Further, he has been running a small but successful Internet branding and advertising business from his bedroom for the past two years, so he has also developed more business sense than most of his peers. Bobbie approaches a small-business owner, Ian, who has owned restaurants for 25 years, about providing Internet marketing services for Ian’s three restaurants for the next 12 months. After contracting with Bobbie, Ian learns Bobbie’s age. Ian feels embarrassed that he’s just contracted for an important business matter with a teenager. Choose the best answer:
10. Which answer most completely describes the defenses that are available to a contracting party when the basis for the defense is action taken by a third party rather than action taken by the other party to the contract?
11. If a defendant raises and proves an affirmative defense, what is the consequence?
12. Which of the following is not a name sometimes used to refer to the legal concept of unjust enrichment?
13. Which of the following would not constitute an improper threat for duress?
14. When a contract is voidable but the party entitled to raise a defense chooses not to raise the defense and instead performs the contract, the party who elects not to raise the defense is said to have _______________ the contract.
15. Dominic is the owner of a car dealership. He attends a party in honor of the 50th
    wedding anniversary of a local businessperson and his spouse—an event attended by several other local businesspeople. Dominic, who does not drink alcohol, is offered a beverage called a “Long Island iced tea.” Dominic accepts the beverage, thinking it is simply iced tea, and not realizing that it is actually a mixed alcoholic drink. During the course of the evening he consumes several of the beverages and becomes intoxicated. While intoxicated, he speaks with Lindsey, who has been looking at a sports car at Dominic’s dealership. Dominic agrees to sell the car to Lindsey for a price that is one half of the car’s market value. The next day, Dominic seeks to avoid the transaction. Choose the best answer:
16. True or False: A party may be able to successfully raise more than one defense.
17. True or False: If a contractual defense makes a contract voidable, the party who can claim the defense has a right to elect to raise the defense or to waive it.
18. The difference between assertions that are fraudulent and assertions that are material is that:
19. Hudson lives in his three-bedroom home for eight years and then decides to sell it. During the time he has lived in the home he has never had any trouble with the roof and has never known it to leak. He sells the house himself, placing a “for sale” sign in the yard and offering the home for sale online. One prospective buyer, Danielle, walks through the house with Hudson and asks him some questions, including the question “Does the roof leak?” Hudson answers, “No, the roof does not leak, not even a little bit.” Satised with Hudson’s answer, Danielle agrees to purchase the house from Hudson at his asking price. Prior to the closing, she learns that the roof does leak, but that the leaking is visible only from inside the attic during a heavy rainfall. Can Danielle use the doctrine of misrepresentation to avoid the contract?
20. André agrees to excavate a basement on Lex’s new residential construction project. André agrees to do the work for a low price, based on his belief that the soil at the excavation site is mostly sand. He brings his excavation equipment to the job site and begins to dig into the soil to create a basement. However, instead of the soil being primarily soft sand (which is easy to excavate), the soil turns out to be primarily rock (which is time-consuming and expensive to excavate). Which fact, if added to this hypothetical, would most likely ensure that André bears the risk of his mistake?
21. Mindy is selling her storage business. She has owned the business for 18 years. In the last three years the business became unprofitable. The losses incurred by the business are reflected in its quarterly financial records and other records. The worst loss the business incurred was in the most recent business quarter. Mindy places all of the financial records in a le folder marked “financial reports” and presents them together with six other folders marked “employees,” “vendors,” “storage contracts,” “collections,” “state and local,” and “miscellaneous,” respectively. The largest folder is the “miscellaneous” folder, containing about 150 pages of documents. Mindy slips the most recent quarterly financial record into the middle of the documents contained in the “miscellaneous” folder before making all of the folders available to a prospective buyer. If the buyer claims Mindy did not disclose the most recent losses in the sale of the storage business, what is the buyer’s most likely description of Mindy’s misrepresentation?
22. What answer below best summarizes all the elements that must be established for a party to successfully assert the defense of duress?

GOVT 404 Quiz Bases for Enforcing Promises

1. Banker promises to Customer that the Bank will make a loan to the Customer’s son if the Customer promises that the Customer will pay any balance on the loan to the Bank immediately if the son fails to repay the loan. Customer agrees. Later the Customer’s son refuses to repay the loan. Customer argues that his promise to the Banker is unenforceable. Choose the best answer:
2. Homeowner enters into a contract with Flooring Company to replenish Homeowner’s hardwood floors on October 15 and 16. The contract price is $4,000, payable after the completion of the work. Flooring Company fails to do any of the work, and Homeowner pays Flooring Company nothing. Homeowner has to pay $4,400 to another flooring contractor to replenish his floors. Which of the following correctly describes Homeowner’s “expectation interest”?
3. Which of the following can serve as consideration?
4. Lisa runs a professional house painting company. She sends one of her painting crews to the Hudson residence to paint the interior of the home. The crew misreads the house numbers, and instead of painting the Hudsons’ house, they start painting the Brodys’ house, three houses down the street. The Brody family home could use a fresh coat of paint, so although they notice the painting crew starting work on their house, they let the crew paint the exterior of their house without objecting. When Lisa sends a bill to Mr. and Mrs. Brody, they refuse to pay it, arguing that they never promised to pay for the painting services. What is Lisa’s best argument?
5. True or False: If a contract is made under circumstances in which one party clearly gets a better deal than the other, the deal is unfair, and there will be no consideration.
6. True or false: An agreement modifying a contract governed by the UCC does not require any consideration to be binding, but must be made in good faith.
7. Which case provides an example of a court applying the pre- existing duty rule?
8. True or false: A gift promise is generally unenforceable, unless the promisee reasonably and justifiably relies upon it.
9. True or False: The reliance doctrine only enforces promises that a promisor should reasonably expect to induce reliance by a promisee.
10. Which statement most accurately describes the difference between the expectation interest and reliance interest in contract damages?
11. Baxter has been an employee of Shipping Company for seven years. His manager notices that he has been working late, making sure that the company trucks are properly cleaned out, stored, and locked up in the company garage at the end of each workday. The manager tells Baxter that he appreciates his hard work, that Baxter should not feel obligated to stay late to lock up the equipment anymore, and that Baxter can expect a $250 bonus in his next paycheck because of his past efforts. Is the manager’s statement enforceable based on the theory of consideration?
12. AlphaCo and BetaCo enter into a contract for AlphaCo to sell 20 computers to BetaCo. BetaCo agrees to pay AlphaCo $14,000 for the 20 computers. After the contract is signed by the parties, BetaCo asks AlphaCo if it would be willing to provide 21 computers, instead of 20, at no additional cost. AlphaCo agrees to deliver 21 computers. Choose the best answer:
13. Which of the following contracts is subject to the Convention on Contracts for the International Sale of Goods (CISG)?
14. AlphaCo and BetaCo enter into a contract for AlphaCo to provide computer and printer repair services at BetaCo’s oces. The contract is scheduled to begin January 15 and end June 15. BetaCo agrees to pay AlphaCo $18,000 for these six months of service. After the contract is signed by the parties, BetaCo asks AlphaCo if it would be willing to provide cleaning services until June 30 at no additional cost. AlphaCo agrees to work until June 30. Choose the best answer:
15. Bookstore, Inc., an independent bookstore, is looking for a new location. It agrees to buy a small house from Jones for $165,000 if the municipal zoning board will approve Bookstore, Inc.’s request for a variance from the local zoning ordinance, which currently only allows houses in this part of town to be used as residences. The contract between Bookstore, Inc. and Jones is
16. Which of the following is a gift promise, unenforceable under the “bargained-for-exchange” theory of consideration?
17. Hawke wears a gold medallion, passed down from his grandfather, at all times. He is distraught one day when he returns home from work and realizes that the medallion apparently detached from its chain and fell to the ground at some point during the day. He posts signs in the office building where he works and in the adjacent parking garage, offering a $300 reward to anyone who finds the medallion and returns it to him. Rhonda, one of Hawke’s co- workers, finds the medallion in an once stairwell, recognizes it as Hawke’s, and returns it to him, not knowing that Hawke has offered a reward for its return. Choose the best answer:
18. An agreement reached concerning some details of a transaction, but leaving other details to be determined later, is called what?
19. Which of the following is a false statement regarding consideration?
20. Bob is a personal athletic trainer. He is speaking with his friend Jonnie while riding the bus to work. During the bus ride, the two discuss Bob providing Jonnie with personal training sessions, and Bob says he would be happy to give Jonnie some instruction. The next week, Bob provides two personal training sessions to Jonnie. One week later, Jonnie promises to pay Bob for the sessions. However, Jonnie does not pay for them. Which of the following arguments has the potential to be a successful argument for recovery by Bob against Jonnie?
21. Angus is a drywall contractor. He learns that his neighbor, Bonnie, had some water damage and has been talking to Drywall Solutions, another drywall contractor, to complete the repairs. Angus tells Bonnie that she does not need to hire a drywall contractor and that he will perform the work at no cost if Bonnie will supply the drywall materials. Bonnie calls Drywall Solutions, which had offered to do the work for $3,000, and tells them not to come. Angus subsequently refuses to do the work. Bonnie has to pay a third drywall contractor $4,000 to complete the job. What argument should Bonnie make to recover from Angus?
22. Isobel contracts with Lance for Lance to market Isobel’s new line of athletic headwear to sporting-goods retailers. She agrees to pay Lance $10 per hour for his work and 1% of any sales he generates. After three months, Isobel is concerned that Lance is only working 20–30 hours per week and generating very few sales. She learns that Lance is facing competition from several new companies, all marketing products similar to Isobel’s line of athletic headwear. In light of the increased competition, the two agree that Lance should receive 3% of any sales he generates. Choose the best answer: