Q 060471RR – Contracts, Part 2
1. Horatio agrees to paint Stella’s house for $1,000. Horatio fails to paint, and Stella hires Winston to paint the house for $1,000. Stella sues Horatio for breach of contract. Stella likely will receive __________ damages.
2. Warren agrees to paint Abby’s restaurant for $1,000. Warren fails to paint. Abby may be entitled to punitive damages if
A. Abby has to pay substantially more than $1,000 for someone else to perform the job.
B. Abby loses profits as a result of the breach.
C. the contract breached was both written and witnessed.
D. Warren doesn’t know how to paint, misrepresented himself as a painter, and never intended to paint.
3. Bella and Connie are struggling to find jobs. They decide they want to open a child daycare center together. They see a house in the perfect neighborhood with a “For Sale by Owner.” They talk to the owner, reach an agreement, and shake hands. Just before the closing on the house, at which they’ll take ownership of the house, the owner decides not to sell to Bella and Connie. They tell the owner they’re going to sue him for breach of contract. Bella and Connie most likely
A. will win because the owner shouldn’t have entered into a contract with them if he wasn’t sure he wanted to sell the house.
B. won’t win because they can find another house that will work just as well.
C. won’t win because they shouldn’t have entered into an oral contract to buy the house.
D. will win because the owner breached his agreement to sell them the house.
4. James leases an apartment to Kyle for $900 per month rent. The written lease contains no prohibition against assignment, nor does it expressly permit assignment. Kyle assigns his rights to Harley without any consideration. James finds out and objects. The assignment is
A. invalid because James didn’t consent to the assignment.
B. valid because the written lease didn’t prohibit it.
C. valid because there’s no consideration for the assignment.
D. invalid because the lease didn’t expressly permit assignment.
5. One name for a promise made by one party to pay another person’s debts, if that person fails to pay the debt, is
A. collateral contract.
B. prenuptial agreement.
C. signature requirement.
D. condition precedent.
6. Tom and Zeke enter into a contract for Tom to paint Zeke’s house for $1,000 by August 5th. Tom paints half of the house on August 6th, then demands pay. Which of the following is false?
A. Tom may not be in breach if the contract doesn’t make time of the essence.
B. The contract doesn’t violate the statute of frauds.
C. Tom’s duties are discharged under the doctrine of substantial performance.
D. Zeke may have to pay if payment is a condition precedent to the duty to paint.
7. Robert contracts to paint Jake’s house for $500. Robert then asks Elmer to perform the painting work for him. Elmer does a bad job, and Jake wants to sue for breach of contact. Which of the following is true?
A. Robert is responsible for the breach of the contract.
B. Elmer, but not Robert, is responsible for the breach.
C. Robert is responsible for the breach of the contract only if there has been a novation.
D. Robert isn’t responsible if he gave Jake notice of the delegation.
8. Which of the following is an example of discharge by impossibility?
A. Jason agrees to paint Sheila’s house for $1,000. Jason paints, but before Sheila pays him, she files bankruptcy. As a result,
Jason doesn’t get paid.
B. Jason agrees to paint Sheila’s house for $1,000. Sheila changes her mind and asks Jason not to paint. Jason agrees.
C. Jason agrees to paint Sheila’s house for $1,000. Sheila later tells Jason that she won’t pay him. As a result, Jason decides not to paint.
D. Jason agrees to paint Sheila’s house for $1,000. Before Jason can paint, Sheila’s house burns down.
9. Denise orally authorizes Shaun to sell her house. Shaun enters into a written agreement with Eric to sell him the house for $140,000. Both Shaun and Eric sign the contract. Denise learns of the agreement after the fact and decides she doesn’t want to sell. If the contract is ruled unenforceable, the most likely reason is the __________ rule.
A. parol evidence
B. best evidence
C. equal dignities
10. Stan contracts to sell his house to Bonnie for $150,000. Stan then finds a buyer who will pay $200,000 and tells Bonnie he won’t perform. Bonnie wants to make Stan honor his contract. The remedy she should seek is
A. punitive damages.
B. specific performance.
C. consequential damages.
D. compensatory damages.
11. Which of the following is an example of discharge by operation of law?
A. Xavier agrees to paint Rita’s house for $1,000. Rita changes her mind and asks Xavier not to paint. Xavier agrees.
B. Xavier agrees to paint Rita’s house for $1,000. Xavier paints, but before Rita pays him, she files bankruptcy. As a result,
Xavier doesn’t get paid.
C. Xavier agrees to paint Rita’s house for $1,000. Before Xavier can paint, Rita’s house burns down.
D. Xavier agrees to paint Rita’s house for $1,000. Rita later tells Xavier that she won’t pay him. As a result, Xavier decides not
12. Barb and Ned exchange e-mails in which Barb agrees to paint Ned’s house for $1,000. Which of the following statements is true?
A. The contract is enforceable.
B. The contract is unenforceable due to the statute of frauds.
C. The contract can’t be enforced because electronic contracts aren’t legally binding.
D. The contract can’t be enforced because there’s no handwritten signature.
13. Will contracts with Grace to sell her 100 lamps for $1,000. Will breaches his contractual duty to deliver the lamps, and Grace buys 100 lamps for $2,000 from another dealer. Grace sues Will for breach of contract. She will most likely receive what type of damages?
A. Consequential damages of $3,000
B. Nominal damages of $100
C. Compensatory damages in the amount of $1,000
D. Compensatory damages in the amount of $2,000
14. Elmer borrows money from Big Bank, who then assigns the promissory note and mortgage to Financial Institution for valuable consideration. Elmer isn’t given notice of the assignment and continues to pay Big Bank. Financial Institution files suit, claiming Elmer is in default because Elmer failed to pay monthly payments to Financial Institution. Which of the following statements is true?
A. Financial Institution was obligated to give notice to Elmer of the assignment.
B. Financial Institution must pay Big Bank for the payments Elmer made.
C. Elmer is in default to Financial Institution because he didn’t pay them.
D. Big Bank must forgive Elmer’s loan because they failed to notify him.
15. Jessica orally agrees that she will sell 400 pairs of flip-flops to a customer for $600. This agreement is
A. unenforceable because of the parol evidence rule.
B. unenforceable because all necessary elements aren’t met.
C. enforceable because all necessary elements are met.
D. unenforceable because of the statute of frauds.
16. Jack and Jane formed a contract in which Jack agreed to sell Jane a large amount of apples. Jack knew that Jane planned to resell the apples at the farmers’ market the following weekend. Jack failed to deliver the apples as promised. Jane will most likely be able to recover
A. both compensatory and consequential damages.
B. both nominal and punitive damages.
C. compensatory damages only.
D. punitive damages only.
17. On June 29, Henry contracts to purchase American flags, which Henry intends to sell at the annual Fourth of July fireworks event, from Liz. The contract doesn’t specify a delivery date. Liz delivers the flags on July 7. Henry sues for breach of contract. Which of the following will most likely happen?
A. Henry will win because of the equal dignities rule.
B. Henry will win because of the standard construction rule.
C. Liz will win because the contract didn’t specify a delivery date.
D. Liz will win because she delivered within a reasonable time.
18. Which of the following acts is designed to cut down on identity theft related to the use of credit cards?
A. Uniform Electronic Transactions Act
B. Uniform Computer Information Transactions Act
C. E-Sign Act
D. Fair and Accurate Credit Transactions Act
19. Under the _______ rule, courts generally accept into evidence only the original of a writing, not a copy.
A. standard construction
B. parol evidence
C. equal dignities
D. best evidence
20. A substitution, by mutual agreement, of a new party for one of the original parties to a contract is called a
B. complete performance.
C. condition concurrent.
D. mutual rescission.