Deck 9: Formation of Traditional and E-Contracts

Question 1

An implied-in-law contract is a contract in which agreement between parties has been inferred from their conduct.

Answer 1

False

Question 2

Under the mailbox rule, an acceptance is only effective when it is received.

Answer 2

False

Question 3

To create an implied-in-fact contract, it must be established that the plaintiff provided the property or services gratuitously.

Answer 3

False

Question 4

A rejection of an offer is not effective until it is actually received by the offeror.

Question 5

A voidable contract is also termed as an unenforceable contract.

Question 6

A counteroffer is considered a rejection of the original offer.

Question 7

Unless otherwise expressly stated, an auction is considered an auction without reserve.

Question 8

Provision of services qualifies as "consideration" for an enforceable contract.

Question 9

An act of performance is necessary to create a bilateral contract.

Question 10

An offer to create a unilateral contract cannot be accepted by a promise to perform.

Question 11

In a recognizance, a party acknowledges in court that he or she will pay a specified sum of money if a certain event occurs.

Question 12

A promise is something of legal value given in exchange of a consideration.

Question 13

An express contract can be stated orally.

Question 14

A contract is bilateral contract if the offeror's promise is answered with the offeree's promise of acceptance.

Question 15

An option contract is terminated upon the death of the offeror.

Question 16

In auction without reserve, the seller is the offeree.

Question 17

A contract that has been fully performed by both sides is called an executory contract.

Question 18

A unilateral contract can be accepted without the performance of an act by the offeree.

Question 19

To meet the mirror image rule, the offeree must accept the terms of the offer without modification.

Question 20

An offer to create a unilateral contract can be revoked by the offeror any time prior to the offeree's performance of the requested act.

Question 21

An exculpatory clause that results from superior bargaining power is usually found to be void.

Question 22

The infancy doctrine gives adults the right to disaffirm contracts entered with minors.

Question 23

A new promise can include a past consideration for it to be enforceable.

Question 24

The infancy doctrine binds an adult to the minor's decision on a contract.

Question 25

An unconscionable contract cannot be enforced even if the unconscionable clause is removed from it.

Question 26

A contract is considered to be supported by legal value if the promisee receives a legal benefit.

Question 27

Which of the following is an acceptable consideration for a contract?

A) penalty
B) arrest
C) sentence
D) money

Question 28

A contract is ________ if the offeror's offer can be accepted only by the performance of an act by the offeree.

A) executed
B) executory
C) unilateral
D) bilateral

Question 29

Two brothers, Sam and Jim, were fighting over the division of their ancestral property. After ten years of legal battle, a frustrated Sam contacted a powerful politician who subjected Jim to extreme duress to make him sign a contract of assent in favor of Sam. When Jim takes this contract to court, the contract will be declared ________.

A) voidable
B) enforceable
C) conditionally enforceable
D) unenforceable

Question 30

Any contract entered into by a person who has been adjudged insane is void.

Question 31

A person who is insane but not adjudged insane cannot void a contract he or she has entered into.

Question 32

Yvonne finds a carpenter to do some repairs for her house and tells him that if he finishes the job within Saturday, she would pay him $1,000. This offer creates a(n)________ contract.

A) executed
B) unilateral
C) executory
D) bilateral

Question 33

A person who disaffirms a contract based on intoxication must be returned to status quo.

Question 34

Windsor, the owner of Windsor's Sandwiches contacts a new supplier Gary. He tells Gary that he will pay him $375 if Gary delivers 20 pounds of cheese the following morning. Gary promises to make the delivery as requested by Windsor. This creates a ________ contract between them.

A) bilateral
B) unilateral
C) executory
D) implied-in-law

Question 35

Preexisting duty promise is unenforceable because of the introduction of a new consideration.

Question 36

The UCITA is a law common to all states and does not require state legislatures to adopt it as a statute for the state.

Question 37

The intoxicated person is not legally obligated to return consideration, received under the contract, to the competent party.

Question 38

Illusory promises require both parties to perform their contractual obligations.

Question 39

A contract is ________ if the offeror's promise is answered with the offeree's promise of acceptance.

A) executory contract
B) executed contract
C) unilateral contract
D) bilateral contract

Question 40

A person who has dealt with an insane person need not place that insane person in status quo once the contract is voided.

Question 41

The ________ states that the intent to contract is judged by the reasonable person standard and not by the subjective intent of the parties.

A) objective theory of contracts
B) common law of contracts
C) Restatement of the Law of Contracts
D) Restatement (Second) of Contracts

Question 42

Alan tells Sherry that he will pay her $5,000 if she runs the Boston Marathon. Once Sherry starts running the marathon, Alan, legally, ________.

A) can revoke the contract as informal verbal agreements are not binding
B) can reduce the money on offer
C) can only increase the money on offer
D) cannot revoke the contract

Question 43

Which of the following elements must be established to create an implied-in-fact contract?

A) The plaintiff provided the property or services gratuitously.
B) The defendant accepted the property or services offered by the plaintiff as a fee for an illegal activity.
C) The plaintiff made the defendant sign the contract and then changed its terms, calling the new terms "previously implied".
D) The defendant was given an opportunity to reject the property or services provided by the plaintiff but failed to do so.

Question 44

Elizabeth signs a contract to purchase a new car from Spadace Motors. She has not yet paid for the car and Spadace Motors has not yet delivered the car to Elizabeth. This is an example of a(n)________ contract.

A) unenforceable
B) executory
C) void
D) executed

Question 45

Which of the following statements is true of the doctrine of quasi-contract?

A) Agreement between parties to a quasi-contract has been inferred from their conduct.
B) It is an equitable doctrine intended to prevent unjust enrichment.
C) It applies only where there is an enforceable contract between the parties.
D) It allows a court to award monetary damages to a defendant because no actual contract existed between the parties.

Question 46

An offeror uses blackmail to make an offeree sign a contract that involves the sale of the offeree's house. The contract is ________.

A) unenforceable
B) valid
C) void
D) voidable

Question 47

Which of the following is true for an auction with reserve?

A) The seller retains the right to refuse the highest bidder.
B) Invitations to make an offer are not allowed.
C) Goods cannot be withdrawn from sale after the offer has been made.
D) A bid once made cannot be withdrawn and is legally binding.

Question 48

Which of the following is true of enforcing a contract?

A) A contract is only considered valid if it is enforceable by both parties.
B) Parties may voluntarily perform a contract that is unenforceable.
C) In an unenforceable contract, at least one party has the option to void his or her contractual obligations.
D) Void contracts are enforceable in cases involving mutual mistakes.

Question 49

Which of the following is a necessary condition for a contract to be considered valid?

A) It can be voided by both parties.
B) It can be voided by one of the parties.
C) It is enforceable by both the parties.
D) It is enforceable by at least one of the parties.

Question 50

What is recognizance?

A) a sealed document that contains a formal contract whose contents are known to both parties and the referee who supervised its signing
B) a party's acknowledgement in court that he or she will pay a specified sum of money if a certain event occurs
C) a party's acknowledgement in court that he or she is not liable to pay any money if a certain event occurs
D) a sealed document that contains an informal contract whose contents are known only to the parties

Question 51

Ben was talking to Harry who was drunk. Harry agreed to give his car to Ben as a token of friendship. Once sober, Harry asks Ben to return his car. This contract is considered ________.

A) valid
B) voidable
C) void
D) unenforceable

Question 52

Stella is injured in a motor accident and is brought to the hospital by a passerby. Stella subsequently passes into a coma. The doctors and other staff perform the necessary medical procedures to save her life. Stella comes out of her coma after two months and is released from the hospital after the doctors are satisfied by her recovery. Under the doctrine of ________ contract, Stella has to pay the hospital for its services.

A) implied-in-fact contract
B) express contract
C) quasi-contract
D) formal contract

Question 53

Martha contacts a bakery to get a cake for her son's birthday party. She tells the baker that she will pay him $150 for the cake if he delivers the cake on Friday evening. If the baker does not deliver the cake on Friday evening, which of the following will hold true?

A) Martha can sue the baker but cannot recover damages.
B) Martha can sue the baker to recover $150 in damages.
C) Martha cannot sue the baker.
D) The baker has to give $150 plus cost of the replacement cake to Martha as he entered into a verbal contract with her.

Question 54

Which of the following is an informal contract?

A) recognizance
B) lease
C) bank draft
D) check

Question 55

If a contract is required to be in writing under the Statute of Frauds but is not, the contract is ________.

A) voidable
B) void
C) unenforceable
D) valid

Question 56

According to the objective theory of contracts, the intent to enter into an express or implied-in-fact contract is judged by the ________.

A) doctrine of equity
B) legality of the contract
C) reasonable person standard
D) common law of contracts

Question 57

Contracts that have been fully performed by one side but not by the other are classified as ________ contracts.

A) void
B) voidable
C) executory
D) executed

Question 58

An oral agreement to purchase a neighbor's bicycle is a(n)________ contract.

A) void
B) voidable
C) implied
D) express

Question 59

Which of these is an instance of a quasi-contract?

A) an employee receiving his or her paycheck every month
B) two companies signing a business agreement that spans an undefined duration
C) an unconscious man being nursed by a hospital, having been brought in by a passer-by
D) a woman hiring a caterer only after the caterer promises to deliver the food on time

Question 60

Kyle goes to a used-car showroom to buy a sedan. He signs an agreement with the store which bears the name of the car, price, and other details. This is an example of a(n)________ contract.

A) express
B) unilateral
C) implied-in-law
D) implied-in-fact

Question 61

Which of the following is true of a contract where one of the parties is insane but not adjudged insane?

A) The contract is voidable by the competent party.
B) The contract is only voidable by the insane person.
C) Only the court appointed legal guardian to the insane person can modify contracts.
D) The non-insane person must be placed in status quo if the insane person voids the contract.

Question 62

A(n)________ is a contract that courts refuse to enforce in part or at all because it is so oppressive or manifestly unfair as to be unjust.

A) unconscionable contract
B) contract of adhesion
C) contract in restraint of trade
D) quasi-contract

Question 63

What is the significance of the age of majority in relation to legal contracts?

A) People below the age of majority can directly enter into lawful contracts.
B) Mentally incompetent persons need to achieve the age of majority in order to enter into a legal contract.
C) It is the age above which people of capacity can enter into a legal contract.
D) Minors who have entered the age of majority require his or her parents or guardian's consent to enter into a legal contract with adults.

Question 64

Which of the following is true of an option contract?

A) If the offeree chooses not to buy the property then money paid in consideration must be returned.
B) If money is paid as consideration, then that is not applied to the sale price.
C) Death or incompetency of either party terminates an option contract.
D) The offer cannot be revoke during the option period.

Question 65

A contract is said to have legal value if ________.

A) both the promisor and the promisee receive a legal benefit
B) the promisor suffers a legal detriment
C) the promisee suffers a legal detriment
D) the promisee receives a legal benefit

Question 66

Which of the following is true of a contract with an adjudged insane person?

A) The adjudged insane person is bound by the terms of the contract.
B) The contract is void.
C) Only the competent party can enforce the contract.
D) The competent party is legally obligated to uphold the contract.

Question 67

Explain the basic requirements that must be met for a contract to be enforceable.

Question 68

Compare valid, void, voidable and unenforceable contracts.

Question 69

What is UCITA? Explain its role.

Question 70

Why does an illusory contract lack consideration?

A) because the consideration promised is unlawful and therefore void
B) because the person promises to perform an act or do something he is already under an obligation to do
C) because one or both parties can choose not to perform their contractual obligations
D) because the compensation paid is for work done in the past

Question 71

A(n)________ is a contractual provision that relieves one or both of the parties to a contract from tort liability.

A) contract of adhesion
B) exculpatory clause
C) duty of restitution
D) fundamental breach

Question 72

What are the possible problems that can come up in a unilateral contract?

Question 73

Which of the following is true of a gift promise?

A) A gift promise can be enforced in a court of law.
B) A completed gift promise cannot be cancelled for lack of consideration.
C) A gift promise contains considerations.
D) The promisee can take legal action if the promisor does not uphold the promise.

Question 74

The ________ states that an acceptance is effective when it is dispatched, even if it is lost in transmission.

A) rule of silence as acceptance
B) mirror image rule
C) mailbox rule
D) mutual assent rule

Question 75

Give an account of termination of offer due to lapse of time.

Question 76

Which of the following elements has to be proved for a contract to be deemed unconscionable?

A) that the weaker party did not enter the contract under duress
B) that the parties had equal bargaining power
C) that the dominant party justly used its bargaining power
D) that the adhering party had no reasonable alternative

Question 77

Which of the following statements is true about a counteroffer?

A) An offeree that makes the counteroffer is still considered the offeree.
B) A counteroffer terminates the existing offer.
C) A counteroffer can only be made by the offeror.
D) A counteroffer need not be communicated to the offeror.

Question 78

Which of the following is true for a minor under the infancy doctrine?

A) A minor is bound to the adult's decisions in a contract between them.
B) A minor can disaffirm contracts he or she has entered into with adults.
C) A minor cannot enter into a legal contract with another minor.
D) A minor cannot choose to enforce a contract at his or her whim.

Question 79

What is legal insanity?

Question 80

Which of the following is true for an auction without reserve?

A) The bidder is considered the offeror.
B) The seller need not accept the highest bid.
C) The goods on sale cannot be withdrawn.
D) The auctioneer is not allowed to set a minimum bid.