BLAW 234 Module for test #3

29 terms by BaileyGant

Create a new folder

Advertisement Upgrade to remove ads

Module 26, #'s 29-57

On June 1, 2010, Decker orally guaranteed the payment of a $5,000 note Decker's cousin owed Baker. Decker's agreement with Baker provided that Decker's guaranty would terminate in eighteen months. On June 3, 2010, Baker wrote Decker confirming Decker's guaranty. Decker did not object to the confirmation. On August 23, 2010, Decker's cousin defaulted on the note and Baker demanded that Decker honor the guaranty. Decker refused. Which of the following statements is correct?

Decker is NOT liable under the oral guaranty because Decker's promise was NOT in writing.

Nolan agreed orally with Train to sell Train a house for $100,000. Train sent Nolan a signed agreement and a downpayment of $10,000. Nolan did not sign the agreement, but allowed Train to move into the house. Before closing, Nolan refused to go through with the sale. Train sued Nolan to compel specific performance. Under the provisions of the Statute of Frauds...

Train will win because Train made a downpayment and took possession.

Cherry contracted orally to purchase Picks Company for $1,500,000 if it is profitable for one full year after the making of the oral contract. An auditor would be brought in at the end of the year to verify this. Even though the company turns out to be profitable during the upcoming year, Cherry refuses to go through with the contract, claiming that it was unenforceable because it was not in writing. Is Cherry correct?

Yes, because the contract could not be completed within one year.

Which of the following statements is true with regard to the Statute of Frauds?

The contract terms may be stated in more than 1 document.

Carson agreed orally to repair Ives' rare book for $450. Before the work was started, Ives asked Carson to perform additional repairs to the book and agreed to increase the contract price to $650. After Carson completed the work, Ives refused to pay and Carson sued. Ives' defense was based on the Statute of Frauds. What total amount will Carson recover?

$650

Landry Company contracted orally with Newell to pay her $50,000 for the completion of an ethics audit of Landry Company. The report is to span a period of time of at least ten months and is due in fourteen months from now. Newell has agreed orally to perform the ethics audit and says that she will begin within three months, noting that even if she delays the full three months, she will have the report ready within the fourteen-month deadline. Does this contract fall under the Statute of Frauds?

No, despite the due date of fourteen months.

Rogers and Lennon entered into a written computer consulting agreement that required Lennon to provide certain weekly reports to Rogers. The agreement also stated that Lennon would provide the computer equipment necessary to perform the services, and that Rogers' computer would not be used. As the parties were executing the agreement, they orally agreed that Lennon could use Rogers' computer. After executing the agreement, Rogers and Lennon orally agreed that Lennon would report on a monthly, rather than weekly, basis. The parties now disagree on Lennon's right to use Rogers' computer and how often Lennon must report to Rogers. In the event of a lawsuit between the parties, the parol evidence rule will...

Not prevent the admission into evidence of testimony regarding Lennon's right to report on a monthly basis.

Where the parties have entered into a written contract intended as the final expression of their agreement, which of the following agreements will be admitted into evidence because they are NOT prohibited by the parol evidence rules?

YES- Subsequent Oral Agreements
NO- Prior written agreements

In negotiations with Andrews for the lease of Kemp's warehouse, Kemp orally agreed to pay one-half of the cost of the utilities. The written lease, later prepared by Kemp's attorney, provided that Andrews pay all of the utilities, Andrews refused, claiming that the lease did not accurately reflect the oral agreement. Andrews also learned that Kemp intentionally misrepresented the condition of the structure of the warehouse during the negotiations between the parties. Andrews sued to rescind the lease and intends to introduce evidence of the parties' oral agreement about sharing the utilities and the fraudulent statements made by Kemp. The parol evidence rule will prevent the admission of evidence concerning the...

YES- Oral agreement regarding who pays the utilities
NO- Fraudulent statements by Kemp

Joan Silver had viewed some land that she wished to purchase. It was offered for sale by Daniel Tweney over the Internet for $200,000. Silver believes this to be a good deal for her and thus wishes to purchase it. Silver and Tweney have communicated online and wish to make a contract for the land over the Internet. Which of the following statements is (are) correct?
I. Because this contract is covered by the Statute of Frauds, this contract cannot be accomplished over the internet.
II. Because of the parol evidence rule, this contract cannot be completed over the Internet.
III. Because this contract is covered by the Uniform Commercial Code, it may not be accomplished over the Internet.

Neither I, II, nor III is correct.

Generally, which of the following contract rights are assignable?

YES- Option contract rights
NO- Malpractice insurance policy rights

One of the criteria for a valid assignment of a sales contract to a third party is that the assignment must...

Not materially increase the other party's risk or duty.

Egan contracted with Barton to buy Barton's business. The contract provided that Egan would pay the business debts Barton owed Ness and that the balance of the purchase price would be paid to Barton over a ten-year period. The contract also required Egan to take out a decreasing term life insurance policy naming Barton and Ness as beneficiaries to ensure that the amounts owed Barton and Ness would be paid if Egan died.
Barton's contract rights were assigned to Vim, and Egan was notified of the assignment. Despite the assignment, Egan continued making payments to Barton. Egan died before completing payment and Vim sued Barton for the insurance proceeds and the other payments on the purchase price received by Barton after the assignment. To which of the following is Vim entitled?

He is entitled to the payments on purchase price and the insurance proceeds.

Egan contracted with Barton to buy Barton's business. The contract provided that Egan would pay the business debts Barton owed Ness and that the balance of the purchase price would be paid to Barton over a ten-year period. The contract also required Egan to take out a decreasing term life insurance policy naming Barton and Ness as beneficiaries to ensure that the amounts owed Barton and Ness would be paid if Egan died.
Which of the following would describe Ness's status under the contract and insurance policy?

He would be the creditor beneficiary under the contract AND the Insurance policy.

Your client, Bugle, owns a parking lot near downtown San Francisco. One day Bugle is excited because he learns that Fargo, who owns a parking lot next door, has made a contract with ABC Company to sell her land. ABC Company can then construct a building that will contain several nice professional offices. Bugle figures that he will charge more for his parking. He later discovers that the contract fell through. He says that when he finds out who breached the contract, he will sue that party for lost profits that he would have earned. Which of the following is correct?

Bugle has no legal rights against either party.

Baxter, Inc. and Globe entered into a contract. After receiving valuable consideration from Clay, Baxter assigned its rights under the contract to Clay. In which of the following circumstances would Baxter NOT be liable to Clay?

Clay released Globe.

Mackay paid Manus $1,000 to deliver a painting to Mackay's friend Mann. When they met and signed the contract, Mackay said she wanted the painting delivered as soon as possible because it was a gift for Mann's birthday. Several months have passed without the delivery. Mann can maintain lawsuits against which parties to get the painting?

Manus only.

Ferco, Inc. claims to be a creditor beneficiary of a contract between Bell and Allied Industries, Inc. Allied is in debted to Ferco. The contract between Bell and Allied provides that Bell is to purchase certain goods from Allied and pay the purchase price directly to Ferco until Allied's obligation is satisfied. Without justification, Bell failed to pay Ferco and Ferco sued Bell. Ferco will...

Prevail, because Ferco was an intended beneficiary of the contract between Allied and Bell.

Parc hired Glaze to remodel and furnish an office suite. Glaze submitted plans that Parc approved. After completing all the necessary construction and painting, Glaze purchased minor accessories that Parc rejected because they did not conform to the plans. Parc refused to allow Glaze to complete the project and refused to pay Glaze any part of the contract price. Glaze sued for the value of the work performed. Which of the following statements is correct?

Glaze will win because Glaze substantially performed and Parc prevented complete performance.

Which of the following types of conditions affecting performance may validly be present in contracts?

YES to conditions precedent, conditions subsequent, and current conditions.

Which of the following actions if taken by one party to a contract generally will discharge the performance required of the other party to the contract?

Material breach of the contract.

Which of the following actions will result in the discharge of a party to a contract?

BOTH- prevention of performance and accord and satisfaction

To cancel a contract and to restore the parties to their original positions before the contract, the parties should execute a...

Rescission.

Kaye contracted to sell Hodges a building for $310,000. The contract required Hodges to pay the entire amount at closing. Kaye refused to close the sale of the building. Hodges sued Kaye. To what relief is Hodges entitled?

Compensatory damages or specific performance.

Ames construction Co. contracted to build a warehouse for White Corp. The construction specifications required Ames to use Ace lighting fixtures. Inadvertently, Ames installed Perfection lighting fixtures which are of slightly lesser quality than Ace fixtures, but in all other respects meet White's needs. Which of the following statements is correct?

White's recovery will be limited to monetary damages because Ames' breach of the construction contract was NOT material.

Master Mfg., Inc. contracted with Accur Computer Repair Corp. to maintain Master's computer system. Master's manufacturing process depends on its computer system operating properly at all times. A liquidated damages claude in the contract provided that Accur pays $1,000 to Master for each day that Accur was late responding to a service request. On January 12, Accur was notified that Master's computer system failed. Accur did not respond to Master's service request until January 15. If Master sues Accur under the liquidated damage provision of the contract, Master will...

Win, unless the liquidated damage provision is determined to be a penalty.

Nagel and Fields entered into a contract in which Nagel was obligated to deliver certain goods to Fields by September 10. On September 3, Nagel told Fields that Nagel had no intention of delivering the goods required by the contract. Prior to September 10, Fields may successfully sue Nagel under the doctrine of...

Anticipatory repudiation.

Maco Corp. contracted to sell 1,500 bushels of potatoes to LBC Chips. The contract did not refer to any specific supply source for the potatoes. Maco intended to deliver potatoes grown on its farm. An insect infestation ruined Maco's crop but not the crop of other growers in the area. Maco failed to deliver the potatoes to LBC. LBC sued Maco for breach of contract. Under the circumstances, Maco will...

Lose, because it could have purchased potatoes from other growers to deliver to LBC.

Ordinarily, in an action for breach of a construction contract, the statute of limitations time period would be computed from the date the...

Contract is breached.

Please allow access to your computer’s microphone to use Voice Recording.

Having trouble? Click here for help.

We can’t access your microphone!

Click the icon above to update your browser permissions above and try again

Example:

Reload the page to try again!

Reload

Press Cmd-0 to reset your zoom

Press Ctrl-0 to reset your zoom

It looks like your browser might be zoomed in or out. Your browser needs to be zoomed to a normal size to record audio.

Please upgrade Flash or install Chrome
to use Voice Recording.

For more help, see our troubleshooting page.

Your microphone is muted

For help fixing this issue, see this FAQ.

Star this term

You can study starred terms together

NEW! Voice Recording

Create Set