CONTRACTS, PART 1
Finn agrees to pay $100 to anyone who will paint his house. Will hears about the offer and paints. Finn refuses to pay, saying Will never formally accepted Finn's offer. Which of the following is true? A. Will has to formally accept, but can do so within a reasonable time after painting. B. This is a bilateral contract, and Will didn't accept. C. This is a unilateral contract and painting constituted acceptance. D. Offer and acceptance are irrelevant if one of the parties changes position. 2. Which of the following is a necessary element both for fraud and for misrepresentation? A. A fiduciary relationship B. A false statement C. A hidden problem D. The intent to deceive Tyler offers to dance naked on Main Street if Corey will mow Tyler's yard. Corey mows Tyler's yard. Which of the following statements is not potential grounds for setting aside the contract? A. Lack of serious intent to contract B. Inadequacy of consideration C. Illegality of consideration D. All of the above are potential grounds for setting aside the contract 4. Jack is a mature-looking 17-year-old who lives at home with his parents. Jack wants to purchase an automobile. Jack goes to Discount Car Sales, where Bud, the car salesman, never considers that Jack may be a minor. Bud sells Jack a car, with the agreement that Jack will pay Bud $100 per month over the next five years for the car. Which of the following is true? A. Jack can disaffirm the contract because of his status as a minor at the time the contract was formed. B. Bud can hold Jack's parents liable for Jack's contract, because Jack was a minor living in their home at the time the contract was formed. C. Despite Jack's status as a minor, Bud can prohibit Jack from disaffirming a contract for a necessary (or basic) need. D. Bud can disaffirm the contract because of Jack's status as a minor at the time the contract was formed. 5. Madison enters into a contract with a DVD club to purchase four DVDs during the coming year. The agreement provided that she would receive an advertisement listing the main selections, which would be sent to her automatically, unless she sent a reply to stop the shipment. The DVD club sent the first month's advertisement and Madison did nothing. When Madison later received the main selection for that month she complained that she hadn't accepted it. Must Madison pay for it? A. No, because her silence in this case didn't constitute acceptance. B. Yes, because her silence in this case constituted acceptance. C. Yes, because the price is fair. D. No, because Madison didn't specifically order the goods. 6. Jacques offers to paint Alisha's house for $100. Before Alisha responds, Jacques dies. Which of the following statements is true? A. Jacques's offer has been revoked. B. There's no contract because Alisha failed to accept Jacques's offer before he died. C. A representative of Jacques's estate must find someone to paint Alisha's house. D. A representative of Jacques's estate must paint Alisha's house for $100. 7. Juan thinks he would like to purchase Tara's house, but doesn't know whether he will be able to save enough money for a down payment on a loan. Juan agrees to give Tara $5,000 for the option to purchase her house for $150,000 sometime within the next five years. Juan and Tara reduce their agreement to writing, sign it, and Juan gives Tara $5,000. Two years later, Juan wins the lottery and now is financially able to purchase Tara's house. However, that same day Juan receives a letter from Tara revoking her offer to sell for $50,000. Which of the following is true? A. Tara's revocation is effective. B. Tara's revocation is effective as long as she refunds the $5,000. C. Juan can't complain because he failed to accept Tara's offer before it was revoked. D. Tara's revocation isn't effective. 8. Ed contracts with Nathan to kill Nathan's mother-in-law for $1,000. Which element of consideration is missing from this contract? A. Consideration wasn't a bargained-for exchange B. Adequacy of consideration C. All the elements of consideration are present D. Legality of consideration 9. Delivery of unordered merchandize is considered A. a contract to purchase if the items aren't returned. B. an offer to sell. C. performance of a contract. D. a contract to purchase unless the recipient contacts the sender to reject the merchandize. 10. Manny says to Carmela, "I'll paint your house for $100." Carmela says "I accept, provided you also wash the windows." Under common law, the most likely result in this case is that there's A. a contract to paint and wash for an amount yet to be determined. B. a contract to paint and wash for $100. C. no contract. D. a contract to paint for $100. 11. Ken threatens to tell everyone that Bob is a child molester unless Bob agrees to enter into a contract with Ken. Bob agrees and signs the contract. If Bob later challenges the contract, what are the best grounds for doing so? A. Misrepresentation B. Economic duress C. Emotional distress D. Fraud 12. Patty visits Big Grocery store and sees a table with bananas on it. Patty picks up a bunch of bananas, walks to checkout, and hands them to the cashier. This is A. an implied-in-fact contract. B. an implied-in-law contract. C. an express contract. D. no contract. 13. Daisy contracts with Mike that in exchange for $50 Daisy won't whistle for a week. This contract is A. enforceable. B. enforceable only if Daisy is a musician who whistles for a living and would suffer significant income loss by not whistling for a week. C. not enforceable due to lack of consideration. D. unenforceable due to fraud. 14. Eric, a 17-year-old, signs a contract with the armed services to enlist. Later, XXXXX XXXXXes his mind and wants out of the contract. Can he void the contract based on incapacity to contract? A. No B. Yes, after he turns 18 C. Yes D. In some states 15. Carrie decides to offer Shelley the opportunity to purchase her motorcycle for just $500. Carrie told Jim, a mutual friend of Shelley and her, that she intended to make the offer. Later, Carrie changes her mind. Shelley approaches Carrie and says she accepts the offer. No contract was formed most likely because A. Carrie didn't possess a serious, objective intention. B. Jim was acting as an agent for Shelley without telling Carrie. C. Carrie never communicated the offer to Shelley. D. the terms of the offer weren't definite enough to form a contract. 16. Angela, age 14, contracts to purchase medicine from the pharmacy. She and the pharmacist both know that she needs this medicine to live and that it's not being provided to her by anyone else. Which of the following is true? A. Angela can avoid the contract on grounds of lack of capacity. B. The pharmacist can enforce the contract. C. The contract is against public policy. D. The contract can be avoided by Angela on grounds of duress 17. On the Internet, Sara came across a software package she wanted to download. To download the software, she had to read a disclaimer and click an "I Agree" button. Sara didn't bother to read the contents of the "Agreement and Warranties" disclaimer, but she clicked "I Agree." The software caused her computer to crash. Sara filed suit against the company that ran the Web site, and the company's defense is that the "Agreement and Warranties" disclaimer to which Sara agreed disclaimed any responsibility for such occurrences. The most likely result is that Sara will A. lose her lawsuit because she didn't read the disclaimer, which isn't enforceable. B. win her lawsuit because disclaimers aren't enforceable. C. win her lawsuit because she didn't the read disclaimer. D. lose her lawsuit because the disclaimer will be enforced. 18. Tom is selling his motorcycle to Carl. Tom tells Carl that the motorcycle runs perfectly, though he knows that the motorcycle leaks oil. Carl purchases the motorcycle and discovers the problem. Which of the following is true? A. Tom committed passive fraud. B. Tom hasn't committed fraud. C. Tom committed fraud in the inception. D. Tom committed active fraud. 19. At his 80th birthday party, Graham declares that Elsie is his favorite grandchild and that he will leave Elsie $100,000 on his death. Sadly, Graham dies just three days later. No provision of his will leaves Elsie the $100,000. Elsie files a breach of contract claim against Graham's estate. The most likely result is that Elsie will lose because no contract existed due to lack of A. contractual capacity and form. B. contractual capacity and consideration. C. agreement and consideration. D. form and agreement. 20. Camille and Paul go to a bar, and Camille has too much to drink. Camille agrees to paint Paul's house for an agreed-on price. Camille sobers up the next day and decides she wants out of the contract. Which of the following provide Camille with the best argument for getting out of the contract? A. The contract price is too low. B. Camille's judgment was impaired by the alcohol. C. Emotional duress D. Camille's intoxication deprived her of the ability to understand she was entering into a contract.