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ch 3 law

Terms in this set (70)

Daphne offered to sell her diamond engagement ring to Polly after she and her boyfriend broke up. A few days later, Daphne and her boyfriend made up and got back together. Daphne changed her mind and decided that she no longer wanted to sell her ring. Polly was okay with Daphne's decision since they had not yet set a price or exchanged money. What happens now?
The offer is revoked since it had not yet been accepted
John saw an ad for a new car in Sunday's paper. He noticed the model that he was most interested in started at $15,000. Does John have a valid offer?
No, since the price is vague
Paul offered to sell his home to Desmond for the sum of $250,000. However, by the time the paperwork was completed, Desmond had passed away prior to the transaction. Can this contract be terminated?
Yes, since one party to the contract passed away
A/An _____ can be money or another thing of value in exchange for performance by the other party.
Offer
According to Carlill v. Carbonic, an offer can come in the form of a letter, newspaper, website, fax, email , or _____.
behavior
Frederick was supposed to start his new job on June 3rd. He signed his employment agreement which stated he would not take any time off until September 2nd, or he would be terminated. The day before beginning work, Frederick's friend called saying that he had tickets to a movie premier on June 3rd. Frederick decided that he could get out of work if he slammed his hand in the kitchen drawer just hard enough to break a few bones. It worked, and he called his boss to let him know he would not be at work for a few days. In this circumstance, does the doctrine of impossibility of performance apply?
No, Frederick caused his own injury to get out of work.
Hector was supposed to watch Derek's dog for the weekend for a fee of $50. The plans were made, and the contract outlining Hector's responsibilities was signed. On the way over to Derek's house, Hector received a phone call from Derek informing him that his dog fell ill and would need to be hospitalized over the weekend. What type of termination occurred?
Impossibility of performance
Melissa contracted famous chef Jacques Pierre to cater her wedding reception. The contract stated that the shrimp cocktail would be made with extra large shrimp which measured 21-26 shrimp to a pound. Even though the guests did not notice and were enjoying the appetizer, Melissa suspected that the shrimp may be smaller than what she requested. She located a scale and began measuring out the shrimp. As she suspected, the count was 24-28 to a pound. What type of termination occurred?
Non-material performance
Samantha and Terry contracted for the sale of a unicycle. Samantha paid Terry $10, and Terry handed over the unicycle to her. What type of termination of contract occurred?
Performance
Jocelyn wants to purchase Marty's home for $200,000. Jocelyn requested that a clause be added to the contract that states she would be allowed to get out of the contract if a house she toured the previous day and placed an offer on is accepted. Through which clause could the contract be terminated?
Prior commitment
Harriet lives in Ohio but she wishes to purchase property in Florida. After searching several real estate websites, she found a beautiful condominium in Boca Delray. Harriet offered the owner $150,000 for the property via US Mail. Why does the mailbox rule legitimize this offer?
The mailbox rule applies when a valid offer is sent by mail, email or fax machine to the offeree within an established timeline.
When Pamona's doorbell rang at her San Francisco, California condo and the mailman was standing there with a big box with her name on it, she could only think her boyfriend finally remembered her birthday. Much to her dismay, it was not a birthday gift from him. Rather, it was a new food processor from a company she did not recognize. What happens now?
She may retain the food processor as an unconditional gift and it is not considered acceptance in some states.
Ethel, owner of Biddy's Bonnets, needed to purchase a few cases of straw hats for an upcoming event. She faxed a purchase order to Island Top Hats, a company with whom she often does business. They received the request and immediately shipped Ethel's order. Why does the Uniform Commercial Code deem this to be a legal transaction?
The UCC determined that the use of a purchase order is an invitation to accept an offer.
Bridget was surfing a popular marketplace website in search of a new computer. She found a vendor that was selling a brand new computer for $500.00. The ad stated that the buyer needed to email the vendor in order to complete the transaction. Bridget then sent an email to the seller with her credit card information and other pertinent details like her address and phone number. After waiting several weeks for shipment, she called the vendor; they had already sold out of the computers. Which statement BEST describes this predicament?
This is a difficult situation because the courts do not fully recognize the Mailbox Rule for email acceptance.
Maribel was reading the local paper when she came across an ad for a puppy. She called the owner and he said he would deliver the pup to her home. She gave the seller her credit card information over the phone and rushed out to purchase a few chew toys, a bed, and some food. When the doorbell rang, the owner had not delivered a puppy but a large dog with a greying chin and a few loose teeth; Maribel was shocked to find that the canine was not a puppy at all but an old dog named Puppy. Why is Maribel permitted to cancel the agreement under the mirror image rule?
The dog that was delivered was not representative of the ad or the offer.
If an acceptance of an offer is lost in the mail, the contract will ultimately be
honored
If circumstances surrounding the original terms of an offer are changed as the offer is on its way in the mail to the offeree, the offeror will _____ his offer.
make good on
An offer is considered to be valid when
it is placed in the mailbox by the offeror.
If an offer and an associated withdrawal cross paths in the mail, AND the offer had been accepted prior to receiving the withdrawal, the contract will ultimately be
upheld
The mailbox rule applies to which of the following?
all of the answers are correct
Jacinda wants to get a bit of revenge against her roommate for stealing her boyfriend. So, Jacinda posts an ad for a room for rent. She makes appointments only when her friend is home. After several people visit the apartment, one person offers to move in. Jacinda, winking at the interested renter, says, 'sure, we have a deal, sign here.' Jacinda and the prospective renter both sign the document. The next day, the new renter arrives with her stuff. Jacinda and her roommate have since made up. Jacinda tells the new roommate that she was only pretending to rent the place to get back at her roommate. Did mutual assent exist?
Yes, mutual assent exists because Jacinda agreed to rent the room and both parties signed an agreement.
A reasonable person would believe that two parties agreed to something based on outward behavior. What is this called?
Objective Theory of Contract
If the court decides that mutual assent exists, what rights do the parties to the contract have?
Specific performance
Sam was reading the classified ads and noticed a horse for sale. He called the owner and asked about the horse. Happy about the response, Sam said, 'I will give you $50 for the horse.' Who is Sam in this negotiation?
Offeror
If Juan tells Pedro, 'I would sell you my house if you had $1,000,000 to buy it and nothing more is said or done, can Pedro sue for specific performance under mutual assent?
No, it was a one-time statement. Nothing was written or discussed in detail
What is a promise to do something that the promisee has no legal duty to do a form of?
Legally sufficient consideration
Why did Labriola seek a declaratory judgment against the Pollard Group?
Because a legal controversy arose but no damages had yet occured
What is consideration?
An exchange of bargained-for promises between two or more parties
While on duty, Police Officer Jones spots a stolen sports car. A few day earlier, he saw a poster offering a $1000 reward to anyone who who helped the owner recover the stolen car. Why is Officer Jones not allowed to accept the reward?
A party cannot promise to do something where there is already the legal obligation to do so.
In Labriola v. Pollard, which legal issue finally settled the case?
Whether the new contract lacked consideration for Labriola
Rachel decides to sell the dress that her daughter wore to last year's prom to her friend Joan for $300 so her daughter can wear it to the upcoming winter formal. Joan accepts Rachel's offer, and they pick a place to meet to make the exchange. This is an example of which of the following?
Consideration
Dan was about to turn 18, and his father, Don, promised to have a shiny new car at the curb on the morning of his milestone birthday. When an excited Dan woke up, no car was at the curb. Dan turned to Don requesting the car. Don said he did not buy him any such car, and Dan threatened to sue. What is the likely outcome?
Dan had no contract since a gift cannot be used as consideration
Officer Pete noticed a wanted poster in the local post office. He recognized the criminal from the neighborhood. Pete picked up the perpetrator and brought him downtown. An arrest took place, and Pete demanded the reward. What will likely happen?
Pete will not get the reward since he is already legally bound to arrest criminals
A local chef visited a local farmer. The chef said he would buy as much cauliflower as the farmer could grow. The following week, several truckloads of cauliflower arrived at the chef's restaurant. The chef refused to pay, and the farmer threatened to sue. Which of the following would apply?
The farmer is unable to sue since he and the chef agreed on an illusory promise
Mabel asked Sally for a ride to the mall. Sally was happy to take her. When they returned home, Mabel said she would take Sally to lunch the following day to thank her for the ride. Sally showed up at noon with her appetite, but Mabel refused to take her to lunch. What will likely happen?
Mabel and Sally did not have a valid contract since consideration was made as a result of a past event
Long-time friends Sandy and Millie are enjoying a night out together at a local pub. After Millie treated Sandy to a bottle of tequila, the friends decided to open a restaurant together; they immediately drafted a contract on a cocktail napkin and began planning their finances. The next morning, Sandy realized that she was in no position to go through with the business venture; Millie raised a civil lawsuit against Sandy. Why will the court likely rule in Sandy's favor?
Because Sandy's level of intoxication was likely too high for her to enter a legal contract
Why is a motivational test used?
In order to understand whether a party understands contract language
James was furious with his parents because they do not allow him to stay up late. At age 17, he rented an apartment on the other side of town. When his landlord inquired about his age, James claimed that he was indeed an adult. James signed the lease and moved into his new apartment. After a few days, James missed his mom's cooking so he asked if he could get out of the lease by admitting to his landlord that he had lied about his age and was actually a minor. What can the landlord do?
The lease may be considered enforceable because he falsified his age at the time of the contract.
Which of the following is NOT an element necessary to sign a legal contract?
Proof that both parties are mentally capable and of sound mind
Which of the following is an example of a situation where the use of a cognitive test would help?
When the court wishes to identify whether somebody has the reasoning power to enter a contract
Joe, a 16 year old, went to the stereo shop and bought a new hi-tech turntable. The clerk asked him his age and Joe responded, 'I am 18 years old, can't you tell?' A week later, Joe's parents discover this purchase and demand he return it immediately. Joe complies. The clerk refuses to accept the return or refund his money. According to contracts with minors, what do you think will happen?
No refund will be issued because Joe falsely stated his age.
If a minor signs a contract for groceries, they are:
Liable to pay for the groceries because it is a necessity.
Which of the following statements is true about minors and contract law?
A minor is allowed to enter into a contract under certain circumstances.
In contract law, maturity means that an individual is:
At least 18 years old.
Sarah, who is 16, was walking when she saw her friend across the street. To catch up with her, Sarah ran through traffic. A police officer witnessed this and handed Sarah a ticket with a fine. Which of the following is likely to happen?
Sarah will have to pay the fine, as this is enforceable even against a minor.
When a mentally ill person enters into a contract, the contract _____.
is voidable
In the case of Temple vs. Mercedes Benz, what standard test would prove the brother's reason for the purchase of an expensive car?
Motivational Test
What does cognitive testing determine?
Whether meaning was understood
In the case of Hauer v. Union, which standard test would have been useful to determine whether she actually understood the language of the contract?
Cognitive Test
John is an alcoholic. He recently signed a contract to buy a very expensive home. Prior to signing the contract, he had six or eight cocktails. What is likely to happen with the contract?
It can be voided because he is an alcoholic.
Ralph, a local real estate agent, was meeting Mary, a first-time home buyer, to discuss an offer on a condo. Mary asked to meet Ralph at The Silver Fox Saloon to discuss the contract. When Ralph arrived, Mary was drinking a glass of Merlot. Ralph requested lemon water, and the negotiations ensued. Mary offered $50,000 above market value for the condo in question. Ralph promptly presented the offer and it was accepted. Several days later, Mary wanted out of the contract, claiming she was intoxicated at the time of the agreement and that Ralph should have known that. What will happen?
The court will determine whether Mary was drunk, and if she was, the contract may be voidable.
Manny wanted to purchase Jerome's sports car. Jerome had no intention of selling the car at the time. Manny and Jerome had a few drinks when the conversation turned to the sale of the car. Manny bought several shots of vodka for Jerome and then asked him to sign an agreement to purchase the car for $500.00. What will happen with this contract?
The court will probably allow for the contract to be voided because Manny wooed Jerome to make an ill-advised decision while intoxicated.
When an intoxicated person enters into a contract, who can void the contract?
The intoxicated person only
Steven and his buddies were drinking some beers at Gin's Mill on Tuesday evening. As they consumed more beers, the conversation turned to vacation. After several more brews, Steven offered to purchase everyone's airline tickets on his smartphone so long as they promise to repay him when they have the money. The men gathered around as Steven thumbed through the transaction, making several errors along the way. First, he booked the wrong city, then the wrong number of travelers. He even listed everyone as senior citizens. After many attempts, he completed the transaction and the tickets were purchased.
The next day, Steven vaguely remembered this. What might the court look for in this contract for the repayment of the tickets?
Whether Steven understood the consequences of making this large purchase
Barry and Sandy were celebrating their graduation from culinary school over a bottle of tequila. Barry suggested that Sandy and he buy a small taco stand together. They gathered their money together and handed it over to Pedro in exchange for the business. In the morning, Sandy vaguely remembered this transaction but noticed her bank account was low. She immediately called Barry and Pedro to cancel the contract. Pedro and Barry consented. A few days later, a sober Sandy wanted back into the deal. Is she allowed to do this?
Yes, once sober, the contract can be re-written. This time, they should refrain from drinking when they do this.
Bob and Linda have a written agreement that is covered by a statute of frauds. Bob wishes to have the contract enforced against Linda. Which of the following is true?
Bob can't enforce the contract unless Linda signed it.
Why is seeing the contract in writing sometimes important in considerations involving statutes of frauds?
The writing proves that a contract existed.
A statute of frauds requires that _____.
certain contracts must be evidenced in writing
A statute of frauds is a _____.
state law
Billy sells Sally a lot for her to build a house on. The sale was for $20,000. After the purchase is completed, Sally has the lot measured and discovers the lot is not as large as Billy advertised it. Is their contract covered by a statute of frauds?
Yes; a statute of frauds covers the sale of land.
A statute of frauds typically covers six different categories. The categories can be remembered by using the mnemonic:
MY LEGS
Which of the following contracts does a statute of frauds not typically cover?
Promises that involve a sale of goods worth less than $500.
Joe takes his daughter, Monica, shopping for a $200 necklace she's been wanting. The necklace is a gift to Monica from Joe. Joe tells the salesperson, 'Please sell her this necklace, and I'll make the payments.' This agreement is:
Not covered by the statute of frauds.
Lucy promises to buy her son and his girlfriend a new house if they get married. They get married, but then Lucy refuses to buy the house. If Lucy's son and his wife sue Lucy for enforcement of the agreement, they'll need to show:
Writing that evidences the agreement, signed by Lucy.
I own a landscaping company and agree to sell you 300 pansies for $2 each. After our agreement, you find the same pansies from another supplier for only $1 each. If I sue you to enforce our agreement, I'll need to show:
The quantity you ordered.
Susie made an oral contract with Richie to remove the leaves from her yard. Richie comes to her house, works for 3 hours, and has finished the leaf removal on only a portion of her yard. Susie returns and cancels the contract with Richie. Though the oral contract is otherwise unenforceable, Richie is entitled to recover the reasonable value (3 hours at $10/hr = $30) of his services. This is called:
Quantum meruit
You and I make an oral contract. You're going to paint my house next week and I'm going to pay you $1000. You then book another painting job and refuse to paint my house. If I want to enforce our contract against you, what do I need?
A written memorandum, signed by you, that proves our contract
An oral contract can be enforced without meeting the requirements of a statute of frauds if the other party confesses under oath that the oral contract was made. This is known as:
Admission exception
When one side completes the contract, the courts will infer that an oral contract really existed. This is known as:
Performance exception
When a party relied on the oral contract, resulting in harm to that party, and the other party could have reasonably foreseen that the first party would rely on the oral contract, the contract will be enforced. This is known as:
Promissory estoppe
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