Deck 13: Capacity and Legality

Question 1

Parents are required by law to provide neces?saries for their minor children.

Answer 1

True

Question 2

A contract to do something that is prohibited by statutory law is void.

Answer 2

True

Question 3

An exculpatory clause in an employment contract is usually enforceable.

Answer 3

False

Question 4

In an employment contract,a covenant not to compete can be enforceable.

Question 5

A party who uses the benefits of a contract before paying for them commits usury.

Question 6

Contractual capacity includes the financial ability to pay for the benefits of a contract.

Question 7

A contract to commit a crime is a contract and therefore enforceable.

Question 8

A minor's right to disaffirm a contract terminates sixty days after the contract's date.

Question 9

All contracts between adults and minors are void.

Question 10

A contract is void if one of the parties was intoxicated at the time of its formation.

Question 11

When a statute protects a certain class of people,a member of that class cannot enforce an otherwise illegal contract.

Question 12

A minor may disaffirm a contract only if the subject matter is illegal.

Question 13

Federal law bars electronic payments,such as credit-card transactions,at online gambling sites.

Question 14

Whether a contract with an unlicensed professional is enforceable depends on the purpose of the statute that requires the license.

Question 15

The lack of an opportunity to read a contract may be unconscionable.

Question 16

If an illegal contract is executory,either party can enforce it.

Question 17

When both parties to a contract are minors,neither of them may disaf?firm the contract.

Question 18

Parents are always liable for the contracts made by their minor chil?dren.

Question 19

The age of majority in most states is eighteen years.

Question 20

Portions of a divisible contract may be enforced.

Question 21

Brasilia,a real estate broker licensed only in Connecticut,con?cludes a land sale in Delaware.She can

A)collect the commission if it has not been paid.
B)keep the commission if it has already been paid.
C)foreclose on the property to obtain any unpaid amount.
D)not collect the commission,keep it,or foreclose on the property.

Question 22

Jacquie signs a contract to buy a car just before reaching the age of major?ity.After reaching the age of majority,Jacquie does not take possession or make payments.Most courts would hold,with respect to the contract,that this is

A)disaffirmance.
B)emancipation.
C)ratification.
D)rescission.

Question 23

On Tim's eighteenth birthday,he decides that he no longer wants to keep a car he bought from Woody's Autos,Inc.,when he was seventeen.His right to disaffirm the deal will depend on

A)the car's condition when Tim bought it.
B)the car's current condition.
C)whether Tim acts within a reasonable period of time.
D)whether Woody's has the right to disaffirm.

Question 24

Jolie signs a contract with Keaton,an unlicensed physician,to perform plastic surgery-a medical procedure.This contract is enforceable by

A)Jolie.
B)Jolie's medical insurance company.
C)Keaton.
D)no one.

Question 25

Lindsey,an emergency medical technician,is called to an accident scene by Nicole and renders medical care to Marvin,a mi?nor.Lindsey may recover the cost from

A)the state.
B)Marvin.
C)Nicole.
D)no one.

Question 26

Ruth,a minor,charges groceries at Sam's Mini-Mart.Two days later,Ruth disaffirms the purchase.Ruth owes Sam's

A)the reasonable value of the groceries.
B)the retail value of the groceries.
C)the wholesale value of the groceries.
D)nothing.

Question 27

Jenna,a minor acting on her own,signs a contract to buy a horse and its tack from Field Equine Ranch.Later,after taking possession of the horse and tack,Jenna disaffirms the deal.She

A)can keep the horse and the tack.
B)can keep the horse but not the tack.
C)can keep the tack but not the horse.
D)must return both the horse and the tack.

Question 28

Delia enters into,and fails to disaffirm soon after reaching the age of ma?jority,a contract with Electronics Stores,Inc.(ESI).Later Delia attempts to disaffirm the contract.ESI files a suit against her.The court will most likely consider the contract ratified if it is

A)executed.
B)exculpatory.
C)disaffirmed.
D)rescinded.

Question 29

Intoxicated but fully aware of the consequences,Uri agrees to a two-year cell-phone service contract with Wander Talk,Inc.,at more than the average market price.This contract is

A)enforceable.
B)not enforceable because contracting parties can change their minds.
C)not enforceable because the contract clearly favors Wander Talk.
D)not enforceable because Uri was intoxicated when he agreed to it.

Question 30

Smitty enters into an illegal bargain with Taylor.Smitty can enforce the con?tract or re?cover for its value if he has been induced to enter into the bar?gain as a result of

A)fraud.
B)his desire to obtain the object of the deal.
C)a persuasive "sell" by Taylor.
D)his belief that Taylor would do right by him.

Question 31

Orin relinquishes the right to his daughter Neko's control,care,custody,and earnings.This act is

A)disaffirmance.
B)emancipation.
C)ratification.
D)severability.

Question 32

Fay is mentally incompetent but has not been so adjudged by a court.Any contract Fay enters into is

A)voidable if Fay has a lucid interval at the time of contracting.
B)voidable if Fay lacks the capacity to comprehend the consequences.
C)voidable if the other party does not realize that Fay is incompetent.
D)unavoidable.

Question 33

Dante enters into a contract with Rosalinda,who does not have contractual ca?pacity.Dante can enforce the contract if Rosalinda

A)does not choose to avoid the contract.
B)is a minor.
C)can obtain the funds to pay for the benefits of the contract.
D)is intoxicated or men?tally incompetent.

Question 34

Cross-Country Trucking Company contracts with Baldwin to transport crated goods to a certain destination for $5,000.Cross-Country delivers the crates,but Baldwin does not pay.Cross-Country learns that the crates contained stolen goods.Cross-Country can

A)do nothing with respect to the contract.
B)recover $5,000 from Baldwin.
C)recover the goods but not the $5,000 from Baldwin.
D)recover the goods or the $5,000 from Baldwin.

Question 35

Max,a minor subject to his parents' care and control,signs a contract to rent an apartment from Noel for one year.Before the end of the term,Max moves out.Noel sues for the rent for the rest of the term.Max can

A)avoid liability for the rent but not disaffirm the contract.
B)disaffirm the contract and avoid liability for the rent.
C)disaffirm the contract but not avoid liability for the rent.
D)not disaffirm the contract nor avoid liability for the rent.

Question 36

Yvon and Zach are minors who marry each other.Their minority status may be terminated under the laws of

A)all states.
B)most states.
C)some states.
D)no states.

Question 37

Chris,a minor,signs a contract to buy alcoholic beverages for Dine & Drink,his parents' restaurant.The contract is

A)valid but may be disaffirmed.
B)valid but may not be disaffirmed.
C)void as a matter of law.
D)void unless it is also signed by Ed,the manager of Dine & Drink.

Question 38

Elmo,a minor,misrepresents his age to be twenty-one and contracts to buy a car from Fine New Autos.Ordinarily,Elmo can disaffirm the contract

A)only if he can prove that Fine New Autos did not know his true age.
B)only if he can prove that Fine New Autos knew his true age.
C)under any circumstances.
D)under no circumstances.

Question 39

Olga,a minor,signs a contract to buy a computer from Phil,the owner of Quality Computer Store.Olga's right to disaffirm the contract

A)does not change the fact that Phil is bound by the contract.
B)does not yet exist because Olga is still a minor.
C)gives Phil,an adult,the right to disaffirm the contract.
D)is not valid because a computer is a "necessary."

Question 40

Fernando obtains a consumer loan from Greater Regional Credit Union at an interest rate that exceeds the state's maximum.Greater Regional has

A)created a risk for the purpose of assuming it. b engaged in a restraint of trade.
C)violated a licensing statute.
D)committed usury.

Question 41

Baby Products,Inc.,hires Cole to develop and implement an e-commerce strategy for marketing Baby's products.Cole signs a contract that in?cludes a clause prohibiting him from competing with Baby during and af?ter the employment.Before the strategy is implemented,Cole resigns from Baby's employ and opens a business to compete with Baby.In Baby's suit against Cole,to determine whether Cole may compete with Baby,what is the most important factor the court should consider?

Question 42

In State X,persons must be at least eighteen years old before they can purchase alcoholic beverages.The state also has passed a law requiring that persons who prepare and serve liquor in the form of drinks in com?mercial establishments be licensed.The only requirement for obtaining a yearly license is that the person be at least eighteen years old.Moffitt,aged thirty-five,is hired as a bartender for the Lone Star Restaurant.Bekins,a staunch alumnus of a nearby university,brings twenty of his friends to the restaurant to celebrate a football victory.Bekins has or?dered four rounds of drinks,and the bar bill exceeds $200.Bekins learns that Moffitt has failed to renew his bartender's license,and Bekins re?fuses to pay,claiming the contract is unenforceable.Is Bekins correct?