Term
| Contract Question 01
Mark Fuhrman contracts to buy Whiteacre. Does Article 2 apply? |
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Definition
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Contract Answer 001
No. Real property is not covered.
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Term
| Contract Question 02
Mrs. Brady hires Michael Jackson to babysit the "bunch." Does Article 2 apply? |
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Definition
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Contract Answer 002
No. Service contracts not covered.
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Term
| Contract Question 03
Delta Airlines agrees to sell 4 DC-9's to United Airlines for $60 million. Does Article 2 apply? |
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Definition
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Contract Answer 003
Yes. Aircraft are movable personal property, i.e. goods.
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Term
| Contract Question 04
Ted Koppel agrees to sell his toupee to Kojak for $10. Does Article 2 apply? |
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Definition
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Contract Answer 004
Yes. A toupe is movable personal property. Art 2 covers every sale of goods, no matter the value, no matter the parties.
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Term
| Contract Question 05
Citibank agrees to lend United $60 million to buy the DC-9's from Delta. |
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Definition
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Contract Answer 005
Subject matter is a loan. Loans and credit arrangements are governed by common law. The purpose for the loan is irrelevant;apply common law.
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Term
| Contract Question 06
Ken Lay buys the "Guide to Accounting," which includes a free class. Does Article 2 apply? |
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Definition
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Contract Answer 006
This is a mixed contract - a contract for goods and services. Pick which law governs by determining which item is more important. The book is the main point of the contract, the class is an add-on, an incentive. Apply Art 2.
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Term
| Contract Question 07
I hire Art Deko to paint my house for $3,000, including the paint provided by Art. Does Article 2 apply? |
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Definition
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Contract Answer 007
Mixed contract. Services (painting) and goods (the paint). Primarily about services so apply the common law.
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Term
| Contract Question 08
Delta Airlines agrees to lease a DC-9 to United Airlines. Does article 2 apply? |
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Definition
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Contract Answer 008
If in NY it's Art 2A. Lease of goods (airplane).
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Term
| Contract Question 09
You lease a car from Avis Rent-a-Car. Does article 2 apply? |
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Definition
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Contract Answer 009
If in NY it's Art 2A. Art2A applies to every lease of goods, whether by business or an individual, i.e. "a consumer"
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Term
| Contract Question 10
You agree to lease an apartment from Helmsley Realty. Does article 2 apply? |
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Definition
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Contract Answer 010
No. Not Art 2A either, because not a lease of goods. It's a lease of real property.
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Term
| Contract Question 11;;What is a contract? |
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Definition
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Contract Answer 011;;Contract is a legally enforceable agreement.
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Term
| Contract Question 12;;What is a quasi-contract? |
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Definition
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Contract Answer 012;;Quasi-contract is an equitable remedy that applies whenever the application of contract law yields an unfair or inequitable result. Quasi-contract is not limited by contract rules, but is governed by equitable concepts. It protects against unjust enrichment. It
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Term
| Contract Question 13;;Ben Affleck orally agreed to work for WB for 5 years for $20M per film. After "Gigli" bombed, WB refused to pay Ben for the film. The Statute of Frauds bars Ben from enforcing the contract. Can Ben recover from WB in quasi-contract? |
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Definition
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Contract Answer 013;;Yes. Not "fair" if Ben can't recover because WB would get his services for free. If the result is unfair or inequitable, discuss that in your essay. Ben can recover the reasonable value of the benefit conferred, NOT the contract price. The value is usually less than the contract price.
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Term
| Contract Question 14;;How is a unilateral contract accepted? |
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Definition
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Contract Answer 014;;A unilateral contract offer can only be accepted by performance.
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Term
| Contract Question 15;;IHOP advertises in the Post: "Incredible offer! Breakfast special for $2.49." Offer? |
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Definition
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Contract Answer 015;;No. Despite the wording ads aren't offers because no quantity term. If it was an offer, unlimited numbers of people could accept. This idea might be tested on the bar.
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Term
| Contract Question 16;;Gap's ad reads: "1 blue dress just like Monica's, only $1! First come, first served." |
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Definition
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Contract Answer 016;;This is an offer because it specifies 1. the quantity and 2. the person who can accept (the first one to arrive).
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Term
| Contract Question 17;;Seller agrees to sell buyer a car for a reasonable price. Offer? |
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Definition
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Contract Answer 017;;No. Too vague.
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Term
| Contract Question 18;;Flatus Cafˇ offers to buy all its requirements of beans for the next 5 years for $1 per can. Offer? |
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Definition
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Contract Answer 018;;Quantity measured by buyer's needs. "All," "Only," and "Solely" likely means an offer to enter into a requirements contract. That is an offer because it is a commitment to exclusivity.
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Term
| Contract Question 19;;Seller accepts the Cafˇ's offer. For the last 3 years, the Cafˇ has ordered 1,000 cans a year. Can the Cafˇ require seller to deliver 8,000 cans this year? |
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Definition
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Contract Answer 019;;No. In a volume change to a requirements contract the buyer can't take the seller by surprise. Any increase in requirements has to be in line with buyer's prior demands. If this is tested on the bar, the increase will be very large, like here (100%).
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Term
| Contract Question 20;;S sends B a letter in which S "offers to sell B Blackacre." The letter does not state a price. Is the letter an offer? |
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Definition
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Contract Answer 020;;Determine which law applies. This is for real estate so Art 2 does not apply. Under the common law there is no offer in a sale of land unless 1. there is a description of the property and 2. the price is included. Since the price is not stated this is not an offer.
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Term
| Contract Question 21;;S sends B a letter in which S "offers to sell B a painting of Blackacre." The letter does not state a price. Is the letter an offer? |
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Definition
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Contract Answer 021;;Paintings are goods so Art 2 applies. Under Art 2 there is an offer if the parties intended there to be an offer. A missing price term can still result in an offer, which is not the case under the common law. This is different than problem #15, where a vague price is not an offer under Article 2 or the common law.
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Term
| Contract Question 22;;On May 15, I offer to sell Jane my 1999 Honda for $5,000. My offer provides that it will terminate on May 30. Can Jane accept my offer on June 2? |
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Definition
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Contract Answer 022;;No, past the seller's deadline. Offer's expiration date was clear. This is too easy so not on the test.
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Term
| Contract Question 23;;On May 15, I offer to sell Jane my 1999 Honda for $5,000. My offer does not contain a termination date. Can Jane accept my offer on December 22? |
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Definition
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Contract Answer 023;;No. even if no deadline is stated, offers do expire, they lapse after a reasonable time. Seven months is not reasonable. If this is tested, there will be a long time delay like this one.
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Term
| Contract Question 24;;What are four ways an offer can be terminated? |
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Definition
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Contract Answer 024;;(1) Lapse of Time,;(2) Offeror's revocation, if it is received before acceptance,;(3) Offeree's rejection,;(4) Death of Either Party before Acceptance.
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Term
| Contract Question 25;;What are the two parts of indirect revocation? |
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Definition
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Contract Answer 025;;Indirect revocation consists of (1) conduct by the offeror unambiguously indicating a change of mind (2) that the offeree is aware of. Need both CONDUCT and AWARENESS.
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Term
| Contract Question 26;;On January 3, I offer to sell Meg Ryan my Honda for $3,000. The next day, in the shower, I exclaim, "I do not want to sell my Honda to Meg." Can Meg still accept? |
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Definition
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Contract Answer 026;;Yes. Unless Meg was in the shower she is not aware of the revocation.
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Term
| Contract Question 27;;If I sell my Honda to Mischa Barton on January 4, can Meg still accept my offer? |
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Definition
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Contract Answer 027;;Yes. Have conduct indicating change of mind about selling to Meg but no evidence that Meg knew about that conduct. Takes both to revoke. This could be on the test.
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Term
| Contract Question 28;;Meg sees Mischa driving my Honda on January 5. Mischa tells Meg she bought the Honda from me the day before. Can Meg still accept my offer? |
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Definition
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Contract Answer 028;;No. Now Meg is aware of the conduct which indicates the revocation of the offer. Revocation is effective.
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Term
| Contract Question 29;;On Monday, I offer to sell Meg my Honda. On Tuesday, I mail her a letter revoking the offer. She receives my letter on Thursday. When is the revocation effective? |
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Definition
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Contract Answer 029;;Thursday. Revocations are effective upon receipt. The mail box rule only applies to acceptances.
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Term
| Contract Question 30;;On Monday, I offer to sell Meg my Honda. On Tuesday, I mail her a letter revoking the offer. Meg had accepted my offer on Wednesday. She receives my letter on Thursday. Deal? |
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Definition
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Contract Answer 030;;Yes. She was not aware my intent to revoke when she accepted, so revocation is ineffective. Her acceptance ends my ability to revoke - there is already an agreement.
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Term
| Contract Question 31;;What are the four situations where an offer cannot be revoked? |
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Definition
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Contract Answer 031;;(1) Option: (a) promise to keep the offer open that's (b) paid for (consideration),;(2) Detrimental reliance that's reasonable & foreseeable,;(3) Part performance of an offer to enter a unilateral contract,and;(4) Firm offer under Article 2: a signed, written promise by a merchant to keep an offer open.
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Term
| Contract Question 32;;P offers to paint O's house for $5,000 & promises not to revoke the offer for 7 days. Can P still revoke the offer? |
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Definition
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Contract Answer 032;;Yes. No consideration given to keep the option open. Promise to keep open in not enough
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Term
| Contract Question 33;;P offers to paint O's house for $5,000. P promises not to revoke the offer for 7 days in exchange for O's payment of $50. O pays $50 for the option. Can P still revoke the offer? |
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Definition
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Contract Answer 033;;No. Have a promise and consideration for that promise so it's enforceable, Parties bargained away/sold right to revoke.
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Term
| Contract Question 34;;Columbia Law School offers me a job. I sell my house in Austin & move my family to New York in reliance on Columbia's offer. Can Columbia still revoke its offer? |
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Definition
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Contract Answer 034;;No, if my reliance is reasonable and foreseeable. Need both elements. The idea is grounded in equity but it is contract law.
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Term
| Contract Question 35;;O offers P $5,000 to paint her house. The offer states that it can be accepted only by performance. P starts painting O's house. Can O still revoke? |
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Definition
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Contract Answer 035;;"Only by performance" indicates this is a unilateral contract. Look for this phrase on the exam. O cannot revoke. In a unilateral contract once painter starts owner can't revoke. Actually painting is definitely "starting."
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Term
| Contract Question 36;;O offers P $5,000 to paint her house burnt orange. The offer states it can be accepted only by performance. P buys paint & goes to O's house, but has not started painting. Can O revoke? |
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Definition
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Contract Answer 036;;No. Mere preparation for performance is not enough to trigger the "unilateral contract part performance rule." Have to actually start performance (put a wet paint brush on the house, but part performance might start before then) BUT preparations can make the offer irrevocable when there is reasonable, foreseeable reliance. This was problem #29. A painter buying paint, something they do all the time, does not meet that criterion.
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Term
| Contract Question 37;;O offers P $5,000 to paint her house. P starts painting the house. Can O still revoke? |
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Definition
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Contract Answer 037;;No. This is a bilateral contract and for bilateral contracts the start of performance is a way to accept the offer. No sign that this unilateral contract but that does not matter on these facts. In a unilateral contract starting performance makes the offer irrevocable
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Term
| Contract Question 38;;Smart Auto Sales, Inc., offers to sell Bart Simpson a 1971 Porsche. The offer is in writing, is signed by Smart, and provides that Smart will not revoke for 2 weeks. Can Smart still revoke? |
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Definition
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Contract Answer 038;;No. Elements of affirm offer under Art 2 are all satisfied: 1. sale of goods, 2. merchant and 3. a promise to keep open. Thus, consideration for that promise is not required
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Term
| Contract Question 39;;Smart Auto Sales, Inc., offers to sell Bart Simpson a 1971 Porsche. The offer is in writing, is signed by Smart, and provides that Smart will not revoke for 6 months. Can Smart still revoke? |
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Definition
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Contract Answer 039;;There is a 3 month cap on firm offers. Six month term will be scaled back to 3 months.
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Term
| Contract Question 40;;Smart Auto Sales, Inc., offers to sell Bart Simpson a 1971 Porsche. The offer is in writing, is signed by Smart. Can Smart still revoke? |
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Definition
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Contract Answer 040;;The offer is open for a reasonable time, not to exceed three months. A reasonable period is shorter for a volatile market (commodities). What specific period is reasonable is too subjective and will not be tested.
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Term
| Contract Question 41;;Smart Auto Sales, Inc. makes a signed, written offer to sell Bart Simpson a 1971 Porsche. Can Smart still revoke? |
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Definition
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Contract Answer 041;;Yes. There is no promise to keep the offer open. The promise to keep open has to be in writing. Read questions carefully. Not every signed written offer by a merchant is a firm offer. Has to say it is.
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Term
| Contract Question 42;;S Realty Co. offers to sell Blackacre to Bart Simpson for $50,000. The offer is in writing, is signed by S, and provides that S will not revoke for 2 weeks. Can S revoke the offer? |
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Definition
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Contract Answer 042;;Yes, real estate is not governed by Art 2 and there is no evidence of reliance, part performance, or consideration paid to keep the offer open. BUT in NY a written promise not to revoke is enforceable - the writing takes the place of consideration.
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Term
| Contract Question 43;;Eva offers to sell Greenacres to Zsa Zsa for $50,000. Zsa Zsa responds, "Dahlink, I vill only pay $49,000." Eva refuses. Can Zsa Zsa later accept Eva's original offer? |
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Definition
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Contract Answer 043;;No. this is a counteroffer, which kills the offer. A counteroffer operates as a rejection, but bargaining does not.
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Term
| Contract Question 44;;Eva offers to sell Greenacres to Zsa Zsa for $50,000. Zsa Zsa responds, "Dahlink, vill you take $49,000?" Can Zsa Zsa later accept Eva's original offer to sell Greenacres for $50,000? |
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Definition
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Contract Answer 044;;Eva offers to sell Greenacres to Zsa Zsa for $50,000. Zsa Zsa responds, "Dahlink, vill you take $49,000?" Can Zsa Zsa later accept Eva's original offer to sell Greenacres for $50,000? A counteroffer operates as a rejection, but bargaining does not.
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Term
| Contract Question 45;;Disney sends Bill Clinton an offer to appear in the film, "Waiting to Inhale." Bill agrees on the condition that he get top billing. Is there an agreement? |
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Definition
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Contract Answer 045;;No. This is conditional and so is not an acceptance. Offeree cannot attach conducts and still accept. Using any of these terms ("on the condition that," "provided that," "so long as," "if") is just like saying "no." A conditional acceptance operates as a rejection & terminates an offer.
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Term
| Contract Question 46;;Landlord sends Tenant a signed lease. The lease is silent about pets. Tenant adds, "Tenant may keep a parrot," signs the lease & returns it to Landlord. Is there an agreement? |
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Definition
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Contract Answer 046;;No. Changed terms of the offer in terms of the agreement. No matter how trivial, a change in terms is a rejection, which terminates the offeree's power to accept. Common law: acceptance must mirror offer ("Mirror Image Rule"). An acceptance containing additional or different terms operates as a rejection under the common law, but not under Article 2.
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Term
| Contract Question 47;;B makes a written offer to buy 100 widgets from S for $1,000. The offer does not mention warranties. S's written acceptance disclaims all warranties. Is there an agreement? |
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Definition
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Contract Answer 047;;Yes. Sale of goods so Art 2 applies. Additional terms are not per se bad. Article 2: acceptance need not mirror offer (no "Mirror Image Rule"). Policy is to facilitate contract formation. An acceptance containing additional or different terms operates as a rejection under the common law, but not under Article 2.
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Term
| Contract Question 48;;Under Article 2, when do the offeree's additional terms rarely get into the contract? |
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Definition
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Contract Answer 048;;The offeree's additional terms become part of the contract only if:;(1) Both parties are merchants;(2) The term is not a "material" change;and;(3) The offeror does not object within a reasonable time.
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Term
| Contract Question 49;;B makes a written offer to buy 100 widgets from S for $1,000. The offer does not mention warranties. S's written acceptance disclaims all warranties. Does the agreement include S's disclaimer? |
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Definition
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Contract Answer 049;;No. Sale of goods so Art 2 applies. Additional terms are not per se bad.Even if both parties are merchants the disclaimer is a material change that is likely to cause hardship or surprise to the offeror.
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Term
| Contract Question 50;;B makes a written offer to buy 100 widgets from S for $1,000. The offer does not mention warranties. S's written acceptance added "Saturday delivery". Does the agreement include Saturday delivery? |
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Definition
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Contract Answer 050;;Yes. Term would be included because it's not a material change.;;If B had responded that Saturday delivery was not convenient, the term would not be included since the offeror objected to it.
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Term
| Contract Question 51;;On April 2, X makes an offer to Y. X dies on April 6. Can Y still accept X's offer? |
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Definition
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Contract Answer 051;;No. Offer terminated on April 6. Doesn't matter if Y knew;only thing that matters is X's death.
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Term
| Contract Question 52;;On April 2, X makes an offer to Y. Y pays X $100 for a 7-day option. X promises not to revoke the offer in exchange for the $100. X dies on April 6. Can Y still accept X's offer? |
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Definition
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Contract Answer 052;;Yes. Options are the exception to the rule that death of a party terminates an offer. Died within the 7 day period, consideration was paid for the option period and Y can accept during that period.
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Term
| Contract Q53;;On Monday, the Donald emails Kwame a job offer that states, "You can accept this offer only by reporting for work on Thursday." Kwame emails back this response, "I am pleased to accept your offer." Has Kwame accepted the Donald's offer? |
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Definition
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Contract Answer 053;;No, "only by" means this is a unilateral contract. Kwame has not accepted the offer because he is not in compliance with the terms of acceptance. While a promise to perform, starting to perform, or completing performance usually qualify as acceptance, the language of the contract WILL control.
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Term
| Contract Question 54;;B faxes S an order for widgets stating, "You can accept this offer only by shipping within 24 hours." S faxes back: "Accept your offer. I will ship within 24 hours." Has S accepted B's offer? |
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Definition
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Contract Answer 054;;No. Promise to ship is not shipping. This is a unilateral contract so it can only be accepted by performance (shipping). BUT at some point the shipper's preparations may prevent the offeror from revoking the offer, if that is reasonable and foreseeable.
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Term
| Contract Question 55;;B faxes S an order for widgets stating, "Widgets must be shipped within 24 hours." S faxes back: "Accept your offer. I will ship within 24 hours." Has S accepted B's offer? |
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Definition
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Contract Answer 055;;Yes. No language that says only performance constitutes acceptance. This is a bilateral contract so a promise to perform is enough.
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Term
| Contract Question 56;;O offers P $5,000 to paint her house. P does not respond with words;instead, P starts painting O's house. Has P accepted O's offer so that P is now bound to paint O's house? |
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Definition
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Contract Answer 056;;Yes. Bilateral contract because type of acceptance not stipulated. A bilateral contract can be accepted in any reasonable way so starting performance is enough.
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Term
| Contract Question 57;;O offers P $5,000 to paint her house. O's offer states P can accept only by performance. P starts painting O's house. Has P accepted O's offer so that P is now bound to paint O's house? |
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Definition
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Contract Answer 057;;No. Unilateral contract, so only completion is acceptance. P is free to take another jib because there is no contract. As the offeree he has not accepted.
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Term
| Contract Question 58;;O offers P $5,000 to paint her house. O's offer states P can accept only by performance. P starts painting O's house. Can O still revoke her offer? |
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Definition
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Contract Answer 058;;No. Offeror is bound. Once offeree begins to perform the offeror cannot revoke. "Unilateral means only one party is bound - the offeror.
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Term
| Contract Question 59;;O offers P $5,000 to paint her house white. P does not respond with words;instead, P paints the house maroon. Has P accepted O's offer, so that O can sue for breach of contract? |
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Definition
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Contract Answer 059;;There is an implied contract. O can sue because improper performance is acceptance and a breach of contract.
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Term
| Contract Question 60;;B orders a Britney CD from S. S ships an Incubus CD instead. What result? |
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Definition
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Contract Answer 060;;Same for sale of goods. Common law and UCC agree that this is simultaneous acceptance of the offer and breach of contract.
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Term
| Contract Question 61;;B orders a Britney CD from S. S ships an Incubus CD instead, but includes a note saying, "I'm out of Britney, but am sending Incubus in the hope it meets your needs." Has S accepted? |
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Definition
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Contract Answer 061;;No. This is the accommodation exception. If seller lets buyer know why he is sending the wrong goods it is NOT an acceptance by performance and thus cannot be breach.
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Term
| Contract Question 62;;I leave a note on your outline at the break: "I offer to sell you my Honda for $5,000. If I don't hear from you by 9 p.m. tonight, you've accepted." You say nothing. Have you accepted? |
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Definition
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Contract Answer 062;;No. Offeror can't single-handedly turn offeror's silence into acceptance;too much chance the offeree will be bound against their will.
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Term
| Contract Question 63;;What is the mailbox rule? |
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Definition
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Contract Answer 063;;Mailbox Rule: acceptance is effective when mailed [Policy: protects the offeree, who can rely on a contract being formed once he mails an acceptance, an equity concept in contract law]. All other communications (e.g. offers) are effective upon receipt.
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Term
| Contract Q64;;VS sent Janet a letter offering her a job as a model. On Feb. 2, VS sent Janet a letter revoking. Janet mailed her acceptance Feb. 4. On Feb. 6, Janet received the revocation. On Feb. 8, VS received the acceptance. Is acceptance effective? |
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Definition
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Contract Answer 064;;Yes. Janet had no notice of revocation at time of acceptance. Acceptance effective on the 4th, when she mailed. Revocation would have been effective on the 6th but it's moot.
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Term
| Contract Q65;;VS sent a letter offering Janet a job as a model. On Feb. 2, VS sent her a letter revoking its offer. Janet mailed her acceptance Feb. 4. On Feb. 6, Janet got the VS revocation. VS never got Janet's acceptance letter. Is it effective? |
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Definition
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Contract Answer 065;;Yes. Janet had no notice of revocation at time of acceptance. Acceptance effective on the 4th, when she mailed. Revocation would have been effective on the 6th but it's moot. The harm from lost mail is borne by the offeror.
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Term
| Contract Question 66;;Captain Kirk offers to sell the Enterprise to the Klingons for $5M. His offer provides, "Your acceptance must be received by January 9." On January 9, the Klingons mail their acceptance. Kirk receives it on January 11. Is Kirk bound? |
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Definition
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Contract Answer 066;;No. Klingons are not in compliance with the terms of acceptance. Offeror can override the mailbox rule.
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Term
| Contract Q67;;Captain Kirk offers the Enterprise to the Klingons for $5M. They pay him $3,000 for his promise to hold the offer open until January 9. On January 9, the Klingons mail their acceptance, which Kirk receives on January 11. Is Kirk bound? |
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Definition
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Contract Answer 067;;No. The mailbox rule does not apply to irrevocable offers so they did not meet the terms of acceptance. Why no mailbox rule? The offeree doesn't need protection that the offeror will revoke;offeree knows when he can no longer rely on the offer.
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Term
| Contract Q68;;Slash gets a letter from the Dixie Chicks inviting him to join the group. On May 14, he mails a letter accepting. On May 16, he mails a letter rejecting. Slash's rejection arrives on May 18. His acceptance arrives on May 20. Is it effective? |
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Definition
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Contract Answer 068;;Probably yes. Receiving rejection first is not enough for a rejection. Acceptance would be effective under the mailbox rule unless rejection gets there first AND the offeror relies on it. If they hire someone else because of the rejection, it's not fair they be burdened.
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Term
| Contract Question 69;;Slash gets a letter from the Dixie Chicks inviting him to join the group. On May 14, he mails a letter rejecting, then mails a letter accepting it on May 16. Which is effective-the rejection or the acceptance? |
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Definition
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Contract Answer 069;;If rejection is sent first, mailbox rule does not apply. Offeree does not need to rely on the contract since offeree rejected it. Thus acceptance is only effective when it is received. Whichever the offeror gets first is effective. It's a race.
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Term
| Contract Question 70;;Sean Penn makes an agreement to sell his Harley to 17-year-old Lindsay Lohan for $27,000. Sean breaches. Can Lindsay enforce the agreement against him? |
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Definition
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Contract Answer 070;;Yes. Plaintiff's capacity is irrelevant. Defendant had capacity so can't get out.
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Term
| Contract Question 71;;Sean Penn makes an agreement to sell his Harley to 17-year-old Lindsay Lohan for $27,000. Lindsay breaches. Can Sean enforce the agreement against her? |
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Definition
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Contract Answer 071;;No. Defendant lacked capacity do the contract can't be enforced against her.
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Term
| Contract Question 72;;Same facts as #64, except that Sean believes Lindsay is 18 because Lindsay told him she was 18. Can Sean enforce the agreement against her? |
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Definition
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Contract Answer 072;;No. Her statement is irrelevant. Only the fact of her age matters.
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Term
| Contract Question 73;;Sean Penn makes an agreement to sell his Harley to 17-year-old Lindsay Lohan for $27,000. Lindsay retains the Harley without complaint after she turns 18. Lindsay breaches. Can Sean enforce the agreement against her? |
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Definition
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Contract Answer 073;;Sean can enforce. Impliedly reaffirmed. Look for 1. lack of capacity at the time of agreement and 2. defendant later gains capacity and 3. defendant retains benefit of contract without complaint.
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Term
| Contract Question 74;;Landlord leases an apartment to tenant for $800 a month. Tenant is mentally incompetent. Is tenant legally obligated to pay for the use of Landlord's apartment? |
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Definition
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Contract Answer 074;;Yes, but only for reasonable value of apartment, not the contract price. An incapacitated party is liable for necessaries (food, shelter, clothing, or medical care), but only on a quasi-contract basis. Enter into a contract for those and the plaintiff can enforce. But the minor is NOT liable for contract price but for reasonable value of benefit conveyed.
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Term
| Contract Question 75;;Princeton Review threatens to shoot my son unless I lecture for them. I agree. Is our agreement legally enforceable? |
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Definition
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Contract Answer 075;;No. Physical duress. This is too easy to be on the bar.
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Term
| Contract Q76;;S & B contract for S to deliver 100 Elmo dolls to B for $1K. S later won't deliver unless B agrees to buy 100 Kermits for $2K. S is the only source for Elmos, which B needs now. B agrees. S delivers the Elmos. Is the Kermit deal enforceable? |
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Definition
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Contract Answer 076;;No. Economic duress causes a flaw in the agreement process.
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Term
| Contract Question 77;;What constitutes economic duress? |
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Definition
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Contract Answer 077;;(1) threat to breach an existing contract unless a party gets a better deal,;(2) other party only agrees because he desperately needs the 1st deal done, and;(3) no alternative source of supply
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Term
| Contract Q78;;S sells umbrellas for $3. When it rains, S increases the price to $10. During a storm, B agrees to buy an umbrella from S for $10. B pays S $10 & receives an umbrella. After the storm, can B get any money back from S on the ground of duress? |
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Definition
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Contract Answer 078;;No. That's not economic duress. Need the elements from question 70.
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Term
| Contract Q79;;S tells B that his house has never had any roaches. That statement induces B to agree to buy S's house. Although S honestly & innocently believes that the house has never had any roaches, it does. Is the agreement legally enforceable? |
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Definition
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Contract Answer 079;;No, because of the material misrepresentation that induced the agreement. Misrepresentation does NOT have to be wrongful, fraudulent or negligent. Even honest and innocent misrepresentation is a fatal flaw.
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Term
| Contract Question 80;;What is a Mutual Mistake of Material Existing Fact? |
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Definition
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Contract Answer 080;;It means a mistake about what something is or that it exists, not what something is worth.
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Term
| Contract Q81;;B and S agree on the sale of a drawing for $75K. Both B and S believe the drawing is a Warhol. After the agreement, but before performance, they learn that the drawing is not a Warhol. Is their agreement enforceable? |
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Definition
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Contract Answer 081;;No. This is a fatal flaw in the process. There is a mutual mistake in material fact: the identity of the artist.
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Term
| Contract Q82;;B and S agree on the sale of a Warhol drawing for $75K. After the agreement, but before performance, they learn that the drawing is worth only $1,000, not $75,000, as both believed? Is their agreement enforceable? |
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Definition
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Contract Answer 082;;Contract is enforceable. A mistake as to market value is not material. Buyer should have had it appraised.
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Term
| Contract Q83;;B & S agree on the sale of a Warhol drawing for $75K. B believes the drawing is a Warhol. S does not, and does not know that B believes it is. After the agreement, but before performance, B learns the drawing is not a Warhol. Enforceable? |
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Definition
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Contract Answer 083;;Yes. Mere fact that one party is mistaken is not a fatal flaw in the agreement process as long as the other party was not aware of the mistake.
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Term
| Contract Question 84;;What is the New York distinction on Lack of Consideration? |
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Definition
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Contract Answer 084;;In NY the existence of a written agreement eliminates the need for consideration.
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Term
| Contract Question 85;;The agreement between B and S provides for the sale of bar exam "flash cards" by S & payment of $100 by B. B now refuses to pay S the $100. Was there consideration for B's promise to buy the flash cards? |
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Definition
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Contract Answer 085;;Yes. The seller's promise to sell was consideration for the buyer's promises to pay. A promise is consideration for a promise.
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Term
| Contract Question 86;;I promise to pay you $100 if you stop listening to recordings by Nine Inch Nails. You do what I asked. Is there consideration for my promise to pay you the $100? |
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Definition
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Contract Answer 086;;Yes. Forbearance is consideration for the promise. Bargain + my detriment.
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Term
| Contract Question 87;;In August, Simon helps Paula unload a U-Haul. In September, Paula promises to pay Simon $300 for his help unloading the U-Haul. Paula now refuses to pay him. Was there consideration for Paula's promise to pay Simon? |
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Definition
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Contract Answer 087;;No. Simon's acts are in the past and they can't bargain for/about something already done.
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Term
| Contract Question 88;;What is consideration? |
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Definition
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Contract Answer 088;;Consideration is a bargained-for legal detriment. A promise, a perfomance, or forbearance
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Term
| Contract Question 89;;Same facts as in #79, except that Paula's promise to pay Simon for his help was in writing? |
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Definition
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Contract Answer 089;;On the multi-state portion, this still isn't enforceable, but in NY it is because it's in writing.
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Term
| Contract Question 90;;We agree that I will pay you $500 for your John Denver "Greatest Hits" CD. The CD is only worth $10. Is there consideration for my promise to pay you $500? |
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Definition
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Contract Answer 090;;Yes. Stupid bargains are still enforceable.
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Term
| Contract Question 91;;What is the "Pre-existing duty rule" |
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Definition
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Contract Answer 091;;The "Pre-existing duty rule" applies to contract modifications - need consideration to modify a contract.
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Term
| Contract Q92;;Ashlee contracts to sing at Owner's venue for $25K. Upon her arrival, Ashlee asks for $30K for the same show. Owner agrees to pay her $30K. Ashlee performs. Owner refuses to pay the extra $5K. Is there consideration for the extra $5K? |
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Definition
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Contract Answer 092;;No. Ashlee did nothing new, she only did what she was obliged to do under the existing contract. She has no additional detriment and owner has no added benefit.;;If the Owner's promise to pay the extra $5K is in writing, In NY the owner is bound, the need for consideration was eliminated by the writing. But on MBE the extra $5000 in not enforceable.
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Term
| Contract Q93;;Ashlee contracts to sing at Owner's for $25K. Upon arrival, Ashlee asks for $30K for the same show. She'll sign autographs for an hour after the show. Owner agrees to pay. Ashlee performs. Owner refuses to pay the extra $5K. Consideration? |
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Definition
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Contract Answer 093;;Bargain plus benefit and detriment for each equals consideration. The additional work for additional pay makes this promise enforceable.
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Term
| Contract Question 94;;Ashlee contracts to sing at Owner's for $25K. Upon arrival, Ashlee asks for $30K for the same show. A local record store promises to pay the extra $5K. Ashlee performs. Is there consideration for the extra $5K? |
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Definition
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Contract Answer 094;;Ashlee is not doing anything new, but the pre-existing duty rule does not apply if the promises is from a third party. It only applies to the original parties to the contract.
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Term
| Contract Question 95;;S contracts to sell 100 widgets to B for $700. Later, S and B orally agree to increase the price to $900. Is B's promise to pay the extra $200 enforceable? |
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Definition
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Contract Answer 095;;Sale of goods, so Art applies. It's enforceable as long as there is good faith. There is no pre-existing duty rule under Art 2. Don't need consideration, but you do need good faith. The exam will use the words "good faith" in the problem if this is tested.
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Term
| Contract Q96;;You owe Visa $2.5K. The debt is due & undisputed. You & Visa orally agree that if you pay $2K now, Visa will forgive the other $500. You pay Visa $2K, but Visa sues you for the other $500! Was the $2K consideration for Visa's promise? |
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Definition
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Contract Answer 096;;No. Partial payment of a due and undisputed debt is not consideration for a promise to forgive the balance of the debt. There was no benefit to them or detriment to you from this promise. This could be tested on the MBE.
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Term
| Contract Q97;;You owe Visa $2.5K. The debt is due & undisputed. You & Visa agree in writing that if you pay $2K now, Visa will forgive the other $500. You pay Visa $2K. Visa sues you for the other $500! Was the $2K consideration for Visa's promise? |
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Definition
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Contract Answer 097;;For the MBE this does not provide consideration, but in NY writings replace consideration so Visa could NOT sue.
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Term
| Contract Q98;;You owe Visa $2.5K. The debt is in dispute. You & Visa orally agree that if you pay $2K now, Visa will forgive the other $500. You pay Visa $2K, but Visa sues you for the other $500! Was the $2K consideration for Visa's promise? |
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Definition
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Contract Answer 098;;Then the release is enforceable. The consideration is the settlement of the disputed debt, which is a benefit to Visa. Law favors the settlement of claims
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Term
| Contract Question 99;;You owe Visa $2,500. Legal action to collect the debt is barred by the statute of limitations. Nonetheless, you write Visa: "I know I owe you $2,500. I will pay you $2,000." Is your promise to pay Visa $2,000 legally-enforceable? |
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Definition
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Contract Answer 099;;Yes, but not due to consideration, it's because of the writing. In this case, and in this case only, under the MBE the writing is a substitute for consideration on the MBE. It is also a substitute in NY, like it normally would be.
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Term
| Contract Q100;;T leases a loft from L under a lease that expires next month. L promises T to renew the lease at the same rent for a year. In reliance, T repaints. L refuses to renew the lease. Was T's work consideration for L's promise to renew? |
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Definition
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Contract Answer 100;;No. The landlord wasn't bargaining. He didn't say "if you paint the house I will rent to you." Tenant has a detriment but there was no bargain.;;Can Tenant enforce Landlord's promise to renew on any other ground? Yes, on the grounds of promissory estoppel. The tenant did rely on the landlord's offer. Not sure it was foreseeable reliance but that does not matter because the bar will not test on that issue. The only question for the exam is whether it possibly COULD BE promissory estoppel, not whether it IS promissory estoppel.
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Term
| Contract Question 101;;Tony Soprano hires Uma Thurman to kill a rival mobster for $20,000. If Uma does not kill the rival, can Tony sue for Uma breach of contract? |
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Definition
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Contract Answer 101;;No. Subject matter of the contract illegal.
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Term
| Contract Q102;;Tony hires Uma to kill a rival for $20K. Uma agrees to buy a non-refundable ticket on American Air from LA, where Uma lives, to Newark, where the rival lives. If Uma does not pay for the ticket, can American recover from Uma for breach? |
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Definition
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Contract Answer 102;;Yes, as long as the airline doesn't know her purpose. Subject matter is a ticket, not the killing. She bought the ticket for an illegal purpose but that is not the issue, as long as the airline doesn't know that.
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Term
| Contract Question 103;;Tony sells the Bada Bing to Guido. The agreement provides that Tony will not open another bar within 5 miles of the Bada Bing for one year. Is this covenant legally enforceable? |
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Definition
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Contract Answer 103;;Not sure. It depends on whether the time and geographic limits are reasonable so we can balance the freedom of contract against the restraint of trade.
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Term
| Contract Question 104;;Tavern on the Green requires all its employees to sign a contract that prohibits an employee from working for another restaurant in N.Y.C. for 90 days. Is this covenant legally enforceable? |
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Definition
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Contract Answer 104;;Employment contracts can have a non-competition clause, rarely seen in other contexts. Look for reasonable time and geographic limits PLUS a reasonable business need for the protection. Clause may be enforceable against a chef, but will not be against a busboy.
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Term
| Contract Question 105;;Builder contracts to remodel Owner's home. The contract provides that Builder will not be liable for damages caused by negligence of its employees. Is this clause enforceable? |
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Definition
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Contract Answer 105;;Depends on the facts. Can contract away liability for negligence in appropriate circumstances but cannot contract away liability for intentional torts or gross negligence.
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Term
| Contract Question 106;;What are the two kinds of unconscionability? |
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Definition
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Contract Answer 106;;Substantive unconscionability (terms themselves are unfair) or procedural unconscionability (something in the fine print makes terms ok but procedures unfair because it is not seen or not understood).;;Unconscionablity is not usually on the test and if it is it is not the right answer.
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Term
| Contract Question 107;;Tenant alleges that Landlord orally agreed to lease an apartment to her for one year. Is their agreement within the Statute of Frauds? |
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Definition
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Contract Answer 107;;No, it's not more than one year.
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Term
| Contract Question 108;;Bill Gates alleges that Gilligan orally agreed to sell Gilligan's island to him. Is their agreement within the Statute of Frauds? |
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Definition
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Contract Answer 108;;Yes. Doesn't say more than one year but permanent transfer is the essence of a sale, so it falls within the statute.
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Term
| Contract Question 109;;"W" alleges that J.R. orally agreed to sell him a two-year easement on Southfork. Is their agreement within the Statute of Frauds? |
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Definition
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Contract Answer 109;;Yes. Transfer of interest in real estate for more than one year. An easement is an interest in land. Agreements for sales, leases and easements all fall within the statue if the time period is greater than one year.
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Term
| Contract Question 110;;"W" alleges that Builder orally agreed to build a fence around his ranch in Crawford, Texas. Is their agreement within the Statute of Frauds? |
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Definition
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Contract Answer 110;;No, this is a contract to build a fence. It is not a transfer of interest in real estate.
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Term
| Contract Question 111;;Woody Woodpecker alleges that on February 8, 2004, "W" orally agreed to have Woody cut down all the trees on his ranch. Is this agreement within the Statute of Frauds? |
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Definition
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Contract Answer 111;;No. Specific task never falls under the SoF;any task is capable of being performed in one year. With enough help Woody can perform in one year so no writing is required.
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Term
| Contract Question 112;;Woody Woodpecker alleges that on February 8, 2004, "W" orally agreed to have Woody cut down all the trees on his ranch. What if Woody doesn't actually finish the job until August 23, 2005? |
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Definition
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Contract Answer 112;;Doesn't matter what actually happens. Theoretically he could have done it and that is all that matters. Specific task never falls under the SoF;any task is capable of being performed in one year. With enough help Woody can perform in one year so no writing is required.
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Term
| Contract Question 113;;Big Bird alleges that Sesame Street orally agreed to employ him for the rest of his life. Is this agreement within the Statute of Frauds? |
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Definition
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Contract Answer 113;;No, for the MBE. A lifetime contract doesn't have to be in writing because the employee could die within one year. But in NY, it IS within the SoF because he might live more than one year.
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Term
| Contract Question 114;;Big Bird alleges that Sesame Street orally agreed to employ him for 3 years. Is this agreement within the Statute of Frauds? |
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Definition
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Contract Answer 114;;Yes. Specific time period in excess of 1 year is always within the SoF.
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Term
| Contract Question 115;;Big Bird alleges that Sesame Street orally agreed to employ him for 1 year, starting next Monday. Is this agreement within the Statute of Frauds? |
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Definition
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Contract Answer 115;;Yes. Clock starts when agreement was made, not when performance is supposed to begin.
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Term
| Contract Question 116;;Enya alleges that on May 1, 2004, Club Putz orally agreed to have her perform at its New Year's Eve Gala on December 31, 2005. Is the agreement within the Statute of Frauds? |
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Definition
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Contract Answer 116;;Yes. Duration of performance is irrelevant. Clock starts on May 1, 2004. Performance in more than 1 year in the future so a writing is required.
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Term
| Contract Question 117;;Sear's alleges that Hilary orally agreed to buy a whitewater raft for $500. Is this agreement within Article 2's Statute of Frauds? |
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Definition
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Contract Answer 117;;Yes. Sale of goods and meets $500 minimum. Art 2 applies to all goods but SoF portion of Art 2 has a dollar threshold.
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Term
| Contract Question 118;;Sear's alleges that Senator Hilary Clinton orally agreed to buy a whitewater raft for $400. Is this agreement within Article 2's Statute of Frauds? |
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Definition
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Contract Answer 118;;No. Not worth enough money to fit into the statute of frauds.
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Term
| Contract Question 119;;Dell Leasing NY Co. alleges that Roger orally agreed to lease a computer for one year for $300 a month. Is such an agreement within the Statute of Frauds? |
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Definition
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Contract Answer 119;;Yes, $3600 total for the lease. Test will use monthly rates so read carefully. Lease of goods where lease payments total $1,000 or more. Governed by Art 2A, so only in NY.
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Term
| Contract Question 120;;Debtor owes Creditor $1,000. Creditor alleges that Guarantor orally agreed to pay the $1,000. Is this agreement to pay within the Statute of Frauds? |
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Definition
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Contract Answer 120;;No. SoF doesn't care about one parties promise to pay others debt. That's not what "answer for" means. Promise to "answer for" the debt of another (limited to guarantees).
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Term
| Contract Question 121;;Debtor owes Creditor $1,000. Creditor alleges that Guarantor orally agreed to pay the $1,000 if Debtor did not pay. Is this agreement to pay if Debtor doesn't pay within the Statute of Frauds? |
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Definition
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Contract Answer 121;;"If Debtor did not pay" means "answer for." Look for this language. Secondary liability means liable only if debtor does not pay.
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Term
| Contract Q122;;Debtor owes Creditor $1K. Creditor alleges Guarantor orally agreed to pay the $1K if Debtor did not pay. Debtor's debt to Creditor is for paint that Debtor bought to use in painting Guarantor's house. Is this within the Statute of Frauds? |
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Definition
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Contract Answer 122;;No. This is the "main purpose exception." If the purpose of the guarantee is to benefit the guarantor then not in SoF. Lot less chance of fraud if guarantor made promise to benefit himself.
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Term
| Contract Question 123;;Demi Moore alleges that Ashton Kutcher orally agreed to renounce all claims to her assets if she would marry him. Is such an agreement within the Statute of Frauds? |
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Definition
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Contract Answer 123;;Yes. A pre-nuptial agreement falls within the SoF. So does a post-nup.
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Term
| Contract Question 124;;Demi alleges that Ashton orally agreed to marry her. Is this agreement within the Statute of Frauds? |
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Definition
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Contract Answer 124;;No. Mere promise to marry is not within the SoF because that promise is not in consideration of marriage.
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Term
| Contract Question 125;;Promise by an estate representative to use her own funds to pay estate expenses. Is this within the Statute of Frauds? |
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Definition
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Contract Answer 125;;Yes.
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Term
| Contract Question 126;;What are the Miscellaneous provisions of the New York Statute of Frauds |
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Definition
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Contract Answer 126;;(1) assignment of insurance policy;(2) promise to name beneficiary of insurance policy;(3) agreement to pay commission or finder's fee
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Term
| Contract Question 127;;Tenant has a contract to rent an apartment from Landlord for 1 year. Tenant alleges that Landlord later agreed to extend the lease to 36 months. Is the modification agreement within the Statute of Frauds? |
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Definition
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Contract Answer 127;;Yes. The original lease is too short to be in the SoF, but the extension makes it long enough to qualify.
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Term
| Contract Question 128;;Tenant has a contract to rent an apartment from Landlord for 36 months. Tenant alleges that Landlord later agreed to reduce the term to 9 months. Is the modification agreement within the Statute of Frauds? |
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Definition
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Contract Answer 128;;No. The original lease needed to be in writing but the modification results in a period of less than 1 year. Thus, the agreement falls outside the SoF and does not have to be in writing.
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Term
| Contract Question 129;;Nick agreed to buy 60 jugs of wine from Elite Liquors for $600. Nick alleges Elite later agreed to reduce the price to $450. Is the modification agreement within the Statute of Frauds? |
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Definition
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Contract Answer 129;;Original agreement was, but the modification makes the overall contract worth less the $500. No SoF.
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Term
| Contract Question 130;;Big Bird has a written contract to work for Sesame Street for 9 months for $5,000 a month. The contract provides that all modifications must be in writing. Is an oral modification effective? |
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Definition
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Contract Answer 130;;Yes. Under the common law a clause that requires written modifications is not enforceable. It is enforceable under Article 2, but since this is not a sale of goods question that does not apply here.
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Term
| Contract Q131;;Elvira sues Chucky for $500 alleging that Chucky agreed to buy 70 dolls for $500. Chucky asserts a SoF defense. There is a writing: "I agree to buy 70 dolls from Elvira," signed by Chucky. Does the writing satisfy SoF against Chucky? |
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Definition
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Contract Answer 131;;Yes. Minimum dollar value for Art 2 SoF and Chucky's signature.
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Term
| Contract Q132;;Elvira sues Chucky for $500 alleging that Chucky agreed to buy 70 dolls for $500. Chucky asserts a SoF defense. There is a writing: "I agree to sell 70 dolls to Chucky," signed by Elvira. Does the writing satisfy the SoF against Chucky? |
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Definition
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Contract Answer 132;;No. But Chucky could use it against her if he wanted. Minimum dollar value for Art 2 SoF and Chucky's signature.
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Term
| Contract Q133;;B, a merchant, faxes S, a merchant: "This confirms our agreement that you will deliver us 50 snowglobes for $500. /s/ B." S gets it, but does not respond. B sues S for breach. S asserts a SoF defense. Does B's fax satisfy the SoF against S? |
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Definition
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Contract Answer 133;;Yes. This only applies to Art 2. This is the one time the defendant didn't have to sign. Three requirements:;(1) both parties are merchants;(2) the writing must confirm a prior agreement and have a quantity term;(3) there must be no response. Merchants often use the phone and then follow-up.
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Term
| Contract Question 134;;What is the lease of goods requirement under article 2A in New York? |
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Definition
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Contract Answer 134;;For the lease of goods, a writing must state:;(1) that it's a lease, 2. the number of items being leased,;(3) the length of the lease, and;(4) the rental payments.;;The defendant's signature is also still required, so the SoF of Art 2A requires a lot more than Art 2.
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Term
| Contract Question 135;;Eve signs the following: "I agree to lease one apple-picking machine from Jake Plummer." Eve breaches. Jake sues Eve for breach of contract. Eve asserts a Statute of Frauds defense. Does the writing satisfy the SoF against Eve? |
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Definition
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Contract Answer 135;;No. Length of the lease and the payment terms are not included as required by Art 2A SoF. Had this been a sale it would have met the requirements. For the lease of goods, a writing must state:;(1) that it's a lease, 2. the number of items being leased,;(3) the length of the lease, and;(4) the rental payments.;;The defendant's signature is also still required, so the SoF of Art 2A requires a lot more than Art 2.
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Term
| Contract Q136;;Eve signs the following: "I agree to lease one apple-picking machine from Jake Plummer for 2 years for $100 a month." Eve breaches. Jake sues. Eve asserts a Statute of Frauds defense. Does the writing satisfy the SoF against Eve? |
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Definition
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Contract Answer 136;;Yes. All necessary information is included. For the lease of goods, a writing must state:;(1) that it's a lease, 2. the number of items being leased,;(3) the length of the lease, and;(4) the rental payments.;;The defendant's signature is also still required, so the SoF of Art 2A requires a lot more than Art 2.
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Term
| Contract Question 137;;Divine Brown mails Hugh Grant the following signed writing: "I accept your offer." Does the writing satisfy the Statute of Frauds? |
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Definition
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Contract Answer 137;;No. None of the material terms are included.
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Term
| Contract Q138;;Crain Law Firm signs the following letter: "We agree to employ Jimmy for 3 years at a salary of $600K a year." A month later, the firm terminates Jimmy without cause. Jimmy sues. Does the writing satisfy the SoF against the firm? |
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Definition
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Contract Answer 138;;Yes. All the material terms are included. "Who" is Jimmy, "What" is salary for $6000 for three years and it's signed by the defendant.
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Term
| Contract Q139;;Crain Law Firm signs the following letter: "We agree to employ Jimmy for 3 years at a salary of $600K a year." Jimmy quits after one month. The firm sues Jimmy. Jimmy asserts a SoF defense. Does the writing satisfy the SoF against Jimmy? |
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Definition
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Contract Answer 139;;No. Jimmy didn't sign. Just the material terms are not enough. Jimmy can use as a sword, but the firm can't use the shield.
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Term
| Contract Q140;;Sesame Street orally agrees to employ Big Bird for 2 years for $50K, payable at the end of term. Bird works for 2 years. Sesame refuses to pay. Bird sues. Sesame asserts a SoF defense. Does Big Bird's working for 2 years satisfy the SoF? |
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Definition
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Contract Answer 140;;Yes. Contract should have been under SoF but Big Bird escapes that requirement. Little chance of fraud when he worked for 2 years and they let him. He is still going to have to prove the pay rate but that is another issue. Full performance of service contracts requires no writing under the SOF.
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Term
| Contract Q141;;Sesame Street orally agrees to employ Big Bird for 2 years for $50K, payable at the end of term. Bird works for 2 months. Sesame refuses to pay. Bird sues. Sesame asserts a SoF defense. Does Big Bird's working for 2 months satisfy the SoF? |
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Definition
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Contract Answer 141;;No. Part performance of a service contract will not satisfy the SoF. Big Bird can't recover because no writing, but also because he didn't perform. However, Big Bird can argue under quasi-contract for payment for the reasonable value of service rendered.
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Term
| Contract Q142;;Bill alleges that Gill orally agreed to sell G Island to him for $400K. Bill has paid Gill $50K, and made improvements to the island. When Bill sues, Gill raises a SoF defense. Does Bill's partial payment plus improvements satisfy the SoF? |
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Definition
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Contract Answer 142;;Yes. Part performance in real estate requires any two of these three things:;(1) partial payment, | |
