Contract Law Interpretation Guide

R sends E a letter offering to sell R’s diamond ring for $*,*. E mails back a letter stating “I like the ring, but there’s no way I’m paying $*,* for it. Sorry.” The next day, however, E changes her mind and sends R a letter via Express Mail stating “Ignore earlier dated letter. I accept your offer and will buy your diamond ring for $*,*.” R receives this Express Mail letter before he gets E’s initial letter. After he gets E’s initial letter, however, he sells the ring to X for $*,*. If E later sues R for breach of contract: *) E can enforce the contract because her acceptance was effective when R received it. *) E cannot enforce the contract. Her initial rejection of R’s offer terminated that offer, which cannot be revived by the later “acceptance” contained in the Express Mail letter. *) E can enforce the contract because her acceptance was effective when it was sent. *) E will be estopped from arguing that she accepted R’s offer because R relied on her rejection.

S, who wants to sell his car, runs into his friend B on the street. S tells B “I’ll sell you my car for $*,*.” B says that she is interested but makes no commitment. There is no further discussion of the car, and the two friends split up after a friendly chat. That afternoon, S sells his car to C. That evening, B calls S and states that she will take the car. S states that he is sorry, but he has already sold the car. As between S and B the most likely result is: *) There is no contract. It is a fundamental principle of contract law that you can’t sell what you don’t own. *) There is no contract. S’s offer lapsed before B accepted. *) There is no contract. S’s sale to C amounted to a revocation of his offer. *) There is a contract. B accepted within a reasonable time. *.

Which of the following statements is correct: *) The UCC only applies to contracts for the sale of goods if at least one party is a merchant. *) The UCC only applies to contracts for the sale of goods if both parties are merchants. *) The UCC only applies to contracts for the sale of goods if neither party is a merchant. *) The UCC applies to contracts for the sale of goods even if neither party is a merchant.

On */*, S sends B a letter in which she offers to sell her boat to B for $*,*. The letter states that “Your mailed acceptance will not be effective until receipt, which must occur on or before */*.” On */*, B sends a letter of acceptance. On */*, S calls and tells B that she is revoking her offer. B’s letter reaches S on */*. As between S and B: *) There is no contract. Since S changed her mind before she received B’s letter, there was not a meeting of the minds. *) There is no contract. The mailbox rule does not apply and S’s revocation was effective. *) There is a contract. B’s acceptance was effective when sent subject to the condition that it arrive by */*. *) There is a contract. B’s sending of the letter on */* created an option contract which prevented S’s revocation from being effective.

A’s son, Levi, was forty-five years old and worked as a trucker. On a cross-country trip, Levi became ill and was taken in and cared for by a stranger, S. Unfortunately, Levi died. When A learned what S had done, he called S and promised to send a check for $*,* to compensate S for her trouble. If A later changes his mind and S sues to enforce his promise, the most likely result is that: *) S will lose. A’s promise was based solely on a moral obligation and was not enforceable. *) S will win based on promissory estoppel. *) S will win. Promises based on moral obligations are enforceable. *) S will win because A’s promise was made in recognition of a measurable benefit previously received.

*. What is the most persuasive rationale for the mailbox rule? *) It protects the offeree against an unexpected revocation by curtailing, at the earliest feasible moment, the offeror’s power to revoke. *) It acknowledges that an offeror who makes an offer by mail has authorized the post office to be her agent to receive the offeree’s acceptance. *) It recognizes that sending an acceptance by mail irrevocably places the letter out of the offeree’s control. *) It encourages the flow of commerce by recognizing that most parties who cannot communicate face-to-face will send offers and acceptances by mail.

*. A, who owns Greenspace, sends an offer to sell it to B. Simultaneously, B sends to A an offer to buy Greenspace which happens to contain terms identical to A’s offer in all respects. B receives A’s offer at the same moment that A receives B’s offer. The most accurate statement about this sequence is: *) A contract is formed because each party has manifested assent to the same deal. *) A contract is formed. In this situation, each offer also functions as an acceptance. *) If either A or B sues the other party, the plaintiff will win because the defendant will be estopped to deny the existence of a contract. *) There is no contract between the parties.

*. Student goes outside for a walk and brings her Contracts casebook. She becomes so engrossed in reading about the exciting world of contracts that she walks into the street without looking and is hit by a car. She is knocked unconscious. Dr. Quack comes along and renders life-saving medical assistance. A few weeks later Dr. Quack, who did not intend to give a gift when he rendered aid, sends Student a bill for services rendered. She refuses to pay. If Dr. Quack sues Student, the most likely result is: *) Dr. Quack will recover the market value of his services in restitution. *) Student will prevail. You can’t make a contract when you’re unconscious. *) Dr. Quack will recover his normal fee for this type of service in restitution even if it is higher than the market value of those services. As a professional, he is entitled to set his own fees. *) Dr. Quack will prevail because there was an implied-in-fact contract.

C agrees to construct a building on land owned by O for $*,*. C begins construction, and after she has spent $*,* on labor, material, and overhead allocable to the project, O materially breaches and throws her off the job. If C had been allowed to continue, her cost to complete the project would have been $*,*. There is evidence that the average contractor in the area would have spent $*,* on the work that C completed. C has not yet been paid anything. *. C’s recovery measured by her expectancy interest would be: *) $*,*. *) $*,*. *) $*,*. *) $*,*.

C agrees to construct a building on land owned by O for $*,*. C begins construction, and after she has spent $*,* on labor, material, and overhead allocable to the project, O materially breaches and throws her off the job. If C had been allowed to continue, her cost to complete the project would have been $*,*. There is evidence that the average contractor in the area would have spent $*,* on the work that C completed. C has not yet been paid anything. C’s recovery measured by her reliance interest would be: *) $*,*. *) $*,*. *) $*,*. *) $*,*.

C agrees to construct a building on land owned by O for $*,*. C begins construction, and after she has spent $*,* on labor, material, and overhead allocable to the project, O materially breaches and throws her off the job. If C had been allowed to continue, her cost to complete the project would have been $*,*. There is evidence that the average contractor in the area would have spent $*,* on the work that C completed. C has not yet been paid anything. C’s recovery measured by her restitution interest would be: *) $*,*. *) $*,*. *) $*,*. *) $*,*.

*. Under the UCC, if a buyer of goods calls the seller prior to delivery and states unequivocally that she will not perform her obligation to make payment upon delivery, the seller: *) Must make a written demand for assurances before canceling the contract. *) May immediately suspend performance but cannot cancel the contract until the buyer has had a commercially reasonable period of time to change her mind and retract her repudiation. *) May cancel the contract and immediately sue for damages. *) May not do anything until after the time for actual performance has passed.

*. In case of doubt as to whether contract language creates a condition or a promise, courts will most likely interpret the language as: *) Creating a promise to cause a condition to be satisfied. *) Creating a condition. *) Creating both a promise and a condition. *) Creating a promise.

*. The principal purpose of the divisibility doctrine is to: *) Prevent forfeiture. *) Keep the parties from prematurely terminating an installment contract. *) Make damage calculations easier. *) Provide the courts with a mechanism for dividing breaches into two categories – material and nonmaterial.

*. A failure of condition provides the person in whose favor it operates with: *) An affirmative cause of action. *) A defense. *) A compulsory counterclaim. *) A claim for equitable relief.

*. Chris is a dealer in rare musical instruments. She owns what she considers to be a Stradivarius violin, which would have a market value of $*,* if it was genuine. She places it in a display case in her store with a sign that states “This is a genuine Stradivarius and you can have it for $*,*.” Sandra, a famous concert violinist, comes into Chris’s store and is enchanted by the violin. She immediately gives Chris a check for $*,*. A few weeks later, Sandra learns that the violin is a clever imitation that is worth only $*,*. Chris had been unaware of this fact and had no reason to know it because the imitation was so good that even the most experienced dealer would not have discovered the problem. If Sandra wants to avoid the contract, return the violin, and get her money back, her best theory is: *) Misrepresentation. *) Impracticability. *) Unilateral mistake. *) Unconscionability.

If Sandra wants to keep the violin, what is her best theory for imposing liability on Chris? *) Breach of the implied warranty of merchantability. *) Breach of an express warranty. *) Breach of the implied warranty of fitness for a particular purpose. *) Misrepresentation.

*. An aggrieved party should not overreact to a shortfall in performance by the other party by canceling the contract because: *) Canceling will constitute a repudiation by the aggrieved party. *) Canceling will cause the aggrieved party to lose its claim for attorney's fees. *) The aggrieved party will lose its cause of action under the doctrine of comparative breach. *) Canceling will estop the aggrieved party to claim damages.

which answer is it

An aggrieved party should not overreact to a shortfall in performance by the other party by canceling the contract because: *) Canceling will constitute a repudiation by the aggrieved party. *) Canceling will cause the aggrieved party to lose its claim for attorney's fees. *) The aggrieved party will lose its cause of action under the doctrine of comparative breach. *) Canceling will estop the aggrieved party to claim damages.

Contract law addresses abusive behavior in the bargaining process through the doctrines of: *) Unconscionability, good faith, duress, and misrepresentation. *) The statute of frauds and the parol evidence rule. *) Unconscionability, duress, and misrepresentation. *) Unconscionability and good faith.