Deck 10: Failure to Create an Enforceable Contract

Question 1

Painter and Hawe discussed the possibility of Hawe entering the employ of Painter as the general manager of Painter's firm. A written contract was prepared and signed by the parties on December 1^st, 1989. The contract provided for a salary of $3,000 per month, and specified that the contract was to run for a period of two years from January 2^nd, 1990. On December 28^th, 1989, Painter notified Hawe that he was cancelling the contract. Hawe sued Painter immediately. The Statute of Frauds would render the contract illegal if it was not in writing and signed.

Answer 1

False

Question 2

The effect of the Statute of Frauds (or any other statutory provision in provinces that have repealed it) is that none of the following may be brought in a court of law unless they are in writing and signed by the party to be charged:

A) a contract concerning an interest in land
B) a promise by an executor or administrator to settle a claim out of his or her own personal estate
C) a guarantee agreement
D) a contract concerning an interest in land and a guarantee agreement
E) All of the responses are correct.

Answer 2

E

Question 3

Cal has just co-signed a car loan for his friend, Peter. This action made Cal the guarantor of the loan. In the event that Peter defaults on payment, Cal has been made liable for payment. After a few months without incident, Cal receives a notice from the bank that Peter missed a payment, and that Cal is to pay. After writing a cheque, Cal confronts Peter who said he could not afford it this month because he bought a new stereo. Cal is annoyed with Peter's irresponsible actions and informs Peter that next month he will have to pay two installments, one to the bank and one to him to make up for this month.

A) Cal does not have the right to be reimbursed by Peter because the co-signing by Cal as guarantor automatically shifts the liability to him in the case of default and he is therefore responsible for the loss personally.
B) Cal has the right to request the missed payment because he can assume the role of a creditor after he has made the missed payment after Peter's default.
C) Cal can not reclaim the payment from Peter because Peter has not put into writing the intention to repay Cal in case of default, which makes the demand of repayment unenforceable.
D) Cal is in the risky position of becoming the principal debtor on Peter's car loan in this situation.
E) Cal can not reclaim the payment from Peter because Peter has not put into writing the intention to repay Cal in case of default which makes the demand of repayment unenforceable and Cal does not have the right to be reimbursed by Peter because the co-signing by Cal as guarantor automatically shifts the liability to him in the case of default and he is therefore responsible for the loss personally.

Answer 3

B

Question 4

Travis verbally ordered a new $500 dinette set from Timpson's Furniture and the salesman accepted the order verbally. Taking his name and address, the salesman having run out of sales contracts, said he would send Travis a copy of the contract the following day, and asked Travis to sign and return it. When the copy of contract arrived, Travis did not sign it and he refused delivery of the dinette set when it arrived. Timpson's sued Travis for breach of contract.

A) Timpson's cannot enforce the contract because, under the legislation governing sales such as this, the contract had to be in writing to be enforceable.
B) Travis cannot raise the defence that the contract had to be in writing to be enforceable.
C) If Travis had accepted delivery of the dinette set, and then had returned it and refused to pay, Timpson's could still not enforce the contract.
D) The contract sent to Travis would defeat his defence that the contract was not evidenced in writing.
E) All of the responses are correct.

Question 5

The parol evidence rule

A) widens the scope to admit into evidence facts proving other agreed terms of a contract.
B) applies to both written and verbal contracts.
C) is circumvented by the existence of a condition precedent.
D) is irrelevant where a written contract cannot be performed within one year.
E) supplies terms to a contract that are otherwise only implied, and by operation of the rule, need not be proven in evidence.

Question 6

Greentree Financing Ltd. enters into an agreement to lend $25,000 to Mai for the purchase of a car. The loan is guaranteed by her father, Mao. What agreements have to be in writing to be enforceable?

A) Loan Agreement
B) Guarantee Agreement
C) The loan agreement if Mai is a minor
D) Both the Loan Agreement and the Guarantee Agreement
E) Neither the Loan Agreement nor the Guarantee Agreement

Question 7

Mary verbally agrees to purchase Carrie's cottage for $75,000 and gives her a deposit cheque for $7,500. Carrie later sends her a letter thanking her for the cheque and confirming all the details of the contract. Mary later refuses to go through with the deal.

A) Carrie can sue Mary for specific performance of the contract since there is a written memorandum of it.
B) Carrie cannot sue Mary for specific performance but is entitled to keep the deposit.
C) Carrie can sue Mary for specific performance because the deposit was part performance.
D) Carrie can sue Mary for specific performance of the contract since there is a written memorandum of it and Carrie can sue Mary for specific performance because the deposit was part performance.
E) None of the responses are correct.

Question 8

Greentree Financing Ltd. enters into an agreement to lend $20,000 to Mark for the purchase of a boat. On the loan application Mark provided the following information: address, telephone, social insurance number, employer, annual earnings and banking information. Mark agreed to the collection of the information for the purpose of assessing his suitability for the loan. How else can Greentree use this information?

A) Soliciting Mark with other offers for other financial products offered by Greentree.
B) Providing the information to Greentree affiliate companies.
C) Selling the information to other unaffiliated companies to solicit Mark with other offers for financial products.
D) Contacting his employer to determine if he is in a permanent job.
E) Greentree cannot use the information for any of these purposes.

Question 9

In the presence of several witnesses, A verbally agreed to purchase B's farm for $175,000. The next day, B changed his mind, and refused to sell the farm to
A. On the strength of the verbal agreement of purchase and sale made in the presence of witnesses, A sued B for breach of contract and for a decree of specific performance to compel B to sell him the farm. The verbal agreement is unenforceable.

Question 10

Greentree Financing Ltd. enters into an agreement to lend $20,000 to Mark for the purchase of a boat. On the loan application Mark provided the following information: address, telephone, social insurance number, employer, annual earnings and banking information. Mark agreed to the collection of the information for the purpose of assessing his suitability for the loan. What steps must Greentree take to protect Mark's information?

A) Greentree must designate an individual accountable for compliance with the Act.
B) Greentree must make information about its policies and practices regarding personal information available to Mark.
C) Mark may have access to his information, upon request.
D) Greentree must have appropriate safeguards to protect the information.
E) All of the steps are required.

Question 11

Martin enters into a verbal contract with Marlowe Ltd. to investigate their operations and their accounting systems, make recommendations as to how to improve them, and help implement the changes Marlowe Ltd. accepts. In the negotiations, Martin makes it clear that he cannot give Marlowe Ltd. a definite timetable and that it is clear that the whole process will take longer than a year. Part of their agreement is that either party may terminate the contract on 60 days' written notice to the other if the work is progressing unsatisfactorily. In this situation,

A) Since the contract is for an indefinite period, it falls under the Statute of Frauds and is not enforceable.
B) If this contract is not completed within a year, it will fall under the Statute of Frauds and will become unenforceable at that point.
C) Since this is a contract for services, it is not covered by the Statute of Frauds and is enforceable.
D) Since this contract cannot be performed within the period of one year from the date it was made, it falls under the Statute of Frauds and is not enforceable.
E) Since this contract could be terminated within one year of being made, it does not fall under the Statute of Frauds even if it is not terminated within the year and is enforceable.

Question 12

Painter and Hawe discussed the possibility of Hawe entering the employ of Painter as the general manager of Painter's firm. A written contract was prepared and signed by the parties on December 1^st, 1989. The contract provided for a salary of $3,000 per month, and specified that the contract was to run for a period of two years from January 2^nd, 1990. On December 28^th, 1989, Painter notified Hawe that he was cancelling the contract. Hawe sued Painter immediately. The Statute of Frauds requires the contract to be in writing, and signed, to be enforceable by Hawe against Painter.

Question 13

In the presence of several witnesses, A verbally agreed to purchase B's farm for $175,000. The next day, B changed his mind, and refused to sell the farm to
A. On the strength of the verbal agreement of purchase and sale made in the presence of witnesses, A sued B for breach of contract and for a decree of specific performance to compel B to sell him the farm. The verbal agreement is valid and enforceable if the witnesses testify in court that an agreement of purchase and sale was made.

Question 14

Painter and Hawe discussed the possibility of Hawe entering the employ of Painter as the general manager of Painter's firm. A written contract was prepared and signed by the parties on December 1^st, 1989. The contract provided for a salary of $3,000 per month, and specified that the contract was to run for a period of two years from January 2^nd, 1990. On December 28^th, 1989, Painter notified Hawe that he was cancelling the contract. Hawe sued Painter immediately. When Painter cancelled the contract, Hawe was released from his obligation to perform.

Question 15

Martin enters into a verbal contract with Marlowe Ltd. to investigate their operations and their accounting systems, make recommendations as to how to improve them, and help implement the changes Marlowe Ltd. accepts. In the negotiations, Martin makes it clear that he cannot give Marlowe Ltd. a definite timetable and that it is clear that the whole process will take longer than a year. Part of their agreement is that either party may terminate the contract on 60 days' written notice to the other if the work is progressing unsatisfactorily. The agreement that the arrangement can be terminated is

A) a condition precedent.
B) a collateral agreement.
C) an implied term of the contract.
D) a condition subsequent.
E) past performance.

Question 16

What is the name of the federal government's legislation governing the gathering of personal information?

A) Privacy Act
B) Personal Information Act
C) Personal Information Protection and Electronic Documents Act
D) Personal Privacy Act
E) Personal Act

Question 17

Steve orally agrees, at a family reunion picnic, to buy Bob's farm for $250,000, and all the terms of the agreement are settled. Bob agrees to let Steve come onto the property before the closing date so that Steve can renovate the farmhouse kitchen and build a new barn before he takes over formally. By the time Bob tells Steve that he has changed his mind and that he will not be completing the transaction on the closing date, Steve has spent $40,000 on the property.

A) Because of the Statute of Frauds, Steve cannot get the farm, but he can sue Bob for the tort of deceit and recover the $40,000.
B) Under the Statute of Frauds, since their agreement was not evidenced in writing, Steve cannot enforce it in court, and cannot recover the $40,000.
C) Steve can use the doctrine of promissory estoppel to force Bob to complete the transaction and give him the farm in exchange for $250,000.
D) Steve can ask a court to order specific performance of the contract because he has spent a lot of money on the property.
E) Under the doctrine of part performance, Steve can request that the court order specific performance of the contract.

Question 18

Greentree Financing Ltd. enters into an agreement to lend $25,000 to Mai for the purchase of a car. The loan is guaranteed by her father, Mao. At a minimum, what must be in writing to constitute a written agreement in accordance with the Statute of Frauds?

A) Date, parties identified, terms of agreement, signature of both parties
B) Parties identified, terms of agreement, signature of both parties
C) Date, parties identified, terms, signature of guarantor
D) Parties identified, terms, signature of guarantor
E) Date, terms, signature of both parties

Question 19

Painter and Hawe discussed the possibility of Hawe entering the employ of Painter as the general manager of Painter's firm. A written contract was prepared and signed by the parties on December 1^st, 1989. The contract provided for a salary of $3,000 per month, and specified that the contract was to run for a period of two years from January 2^nd, 1990. On December 28^th, 1989, Painter notified Hawe that he was cancelling the contract. Hawe sued Painter immediately. Hawe may sue Painter for breach of the contract.

Question 20

In the presence of several witnesses, A verbally agreed to purchase B's farm for $25,000. The next day, B changed his mind and refused to sell the farm toA. On the strength of the verbal agreement of purchase and sale in the presence of witnesses, A sued B for breach of contract and for a decree of specific performance to compel B to sell him the farm.

A) The verbal agreement is valid and enforceable if the witnesses testify in court that an agreement of purchase and sale was made.
B) The verbal agreement is unenforceable.
C) The verbal agreement is void.
D) B may successfully plead the Statue of Frauds as a defence.
E) The verbal agreement is unenforceable and B may successfully plead the Statue of Frauds as a defence.

Question 21

X wished to purchase a motor vehicle from Y on credit, but X was unemployed, and Y was hesitant to sell to him for that reason. Z, who was quite wealthy, said to Y: "Sell X the automobile on credit, and if X does not pay you, I will." Z has made an offer to guarantee the payment of the debt of X.

Question 22

Ravi, an art collector, had been made a standing offer by a gallery to purchase one of his paintings for $150,000. At shows and luncheons of the art community he had previously rejected the entreaties, knowing the painting to be worth at least twice as much. On the latest occasion of a luncheon at which Ravi was deliver an art commentary to the guests, the gallery made its offer once more. To himself, Ravi considered the offer and concluded he could use the charitable tax relief that such a sale at a loss would generate. In the course of his speech, he acknowledged and accepted the offer. Two days later, Ravi's lawyer advised him that the purchasing gallery was NOT a charitable foundation, and no tax deduction for such a "donation" could be expected. Ravi then refused to sell the painting to the gallery. On the strength of the verbal agreement of purchase and sale made in the presence of witnesses, the gallery sued Ravi for breach of contract, and for a decree of specific performance to compel Ravi to sell it the painting. Ravi may successfully plead the Statute of Frauds as a defence.

Question 23

Lev and Drew have been negotiating verbally and in writing concerning the purchase by Lev of a number of items manufactured by Drew's company. Lev insists that they have only reached the stage of having an agreement in principle but Drew says they have a binding contract. If one of the terms they agreed upon verbally was that they would execute a written contract, the court will hold that a contract does exist.

Question 24

Hrushka is the executor of her father's will. She does not want to liquidate any part of his stock portfolio at this time to pay off a large debt he owed Tom, because the market is very low right now and she would get a better price later in the year. Her verbal promise to Tom that she will repay him herself is unenforceable.

Question 25

X wished to purchase a motor vehicle from Y on credit, but X was unemployed, and Y was hesitant to sell to him for that reason. Z, who was quite wealthy, said to Y: "Sell X the automobile on credit, and if X does not pay you, I will." The contract of guarantee is subject to the Statute of Frauds.

Question 26

X wished to purchase a motor vehicle from Y on credit, but X was unemployed, and Y was hesitant to sell to him for that reason. Z, who was quite wealthy, said to Y: "Sell X the automobile on credit, and if X does not pay you, I will." If Z made the guarantee in writing, and signed the document, the guarantee would not be enforceable until X defaulted on a demand for payment by.

Question 27

In the presence of several witnesses, A verbally agreed to purchase B's farm for $175,000. The next day, B changed his mind, and refused to sell the farm to
A. On the strength of the verbal agreement of purchase and sale made in the presence of witnesses, A sued B for breach of contract and for a decree of specific performance to compel B to sell him the farm. The verbal agreement is void.

Question 28

Ravi, an art collector, had been made a standing offer by a gallery to purchase one of his paintings for $150,000. At shows and luncheons of the art community he had previously rejected the entreaties, knowing the painting to be worth at least twice as much. On the latest occasion of a luncheon at which Ravi was deliver an art commentary to the guests, the gallery made its offer once more. To himself, Ravi considered the offer and concluded he could use the charitable tax relief that such a sale at a loss would generate. In the course of his speech, he acknowledged and accepted the offer. Two days later, Ravi's lawyer advised him that the purchasing gallery was NOT a charitable foundation, and no tax deduction for such a "donation" could be expected. Ravi then refused to sell the painting to the gallery. On the strength of the verbal agreement of purchase and sale made in the presence of witnesses, the gallery sued Ravi for breach of contract, and for a decree of specific performance to compel Ravi to sell it the painting. The verbal agreement is valid and enforceable if the witnesses testify in court that an agreement of purchase and sale was made.

Question 29

X wished to purchase a motor vehicle from Y on credit, but X was unemployed, and Y was hesitant to sell to him for that reason. Z, who was quite wealthy, said to Y: "Sell X the automobile on credit, and if X does not pay you, I will." Z's promise would be unenforceable, unless it was made in writing and signed by Z.

Question 30

Ravi, an art collector, had been made a standing offer by a gallery to purchase one of his paintings for $150,000. At shows and luncheons of the art community he had previously rejected the entreaties, knowing the painting to be worth at least twice as much. On the latest occasion of a luncheon at which Ravi was deliver an art commentary to the guests, the gallery made its offer once more. To himself, Ravi considered the offer and concluded he could use the charitable tax relief that such a sale at a loss would generate. In the course of his speech, he acknowledged and accepted the offer. Two days later, Ravi's lawyer advised him that the purchasing gallery was NOT a charitable foundation, and no tax deduction for such a "donation" could be expected. Ravi then refused to sell the painting to the gallery. On the strength of the verbal agreement of purchase and sale made in the presence of witnesses, the gallery sued Ravi for breach of contract, and for a decree of specific performance to compel Ravi to sell it the painting. The verbal agreement is unenforceable.

Question 31

Joyce's son, Al, borrowed money from Verity Finance. He lost his job last month and has not made the latest payment on the debt. When Verity's collections department telephones, Joyce answers the phone. She agrees to make the payments if Al does not because she is worried about his state of mind due to his job loss. Joyce's promise does not have to be in writing to be enforceable.

Question 32

Mr. Guimond was teaching his son, Jacques, to drive in the family car when Jacques failed to apply his brakes soon enough and hit the car in front, causing considerable damage. Mr. Bouchard, the driver of the other car, should get Mr. Guimond's promise to pay for his repairs in writing or it will be unenforceable.

Question 33

In the presence of several witnesses, A verbally agreed to purchase B's farm for $175,000. The next day, B changed his mind, and refused to sell the farm to
A. On the strength of the verbal agreement of purchase and sale made in the presence of witnesses, A sued B for breach of contract and for a decree of specific performance to compel B to sell him the farm. If A had given B $10 in cash as a deposit the agreement would be enforceable.

Question 34

In the presence of several witnesses, A verbally agreed to purchase B's farm for $175,000. The next day, B changed his mind, and refused to sell the farm to
A. On the strength of the verbal agreement of purchase and sale made in the presence of witnesses, A sued B for breach of contract and for a decree of specific performance to compel B to sell him the farm. B may successfully plead the Statute of Frauds as a defence.

Question 35

Joyce's son, Al, borrowed money from Verity Finance. He lost his job last month and has not made the latest payment on the debt. When Verity's collections department telephones, Joyce answers the phone. She agrees to make the payments if Al does not because she is worried about his state of mind due to his job loss. Verity must first try to get the money from Al before approaching Joyce.

Question 36

In the presence of several witnesses, A verbally agreed to purchase B's farm for $175,000. The next day, B changed his mind, and refused to sell the farm to
A. On the strength of the verbal agreement of purchase and sale made in the presence of witnesses, A sued B for breach of contract and for a decree of specific performance to compel B to sell him the farm. Assuming the verbal agreement is unenforceable, the contract would still exist.

Question 37

Joyce's son, Al, borrowed money from Verity Finance. He lost his job last month and has not made the latest payment on the debt. When Verity's collections department telephones, Joyce answers the phone. She agrees to make the payments if Al does not because she is worried about his state of mind due to his job loss. Joyce's promise is called an indemnity.

Question 38

Pashi promises, in an unsigned note, to give Neve, her daughter-in-law-to-be, the family jewellery and some share certificates worth $100,000 on the day she marries Pashi's son. If she does not do so, Neve can enforce the agreement since it is evidenced in writing and she, by marrying, gave Pashi consideration for her promise.

Question 39

Ravi, an art collector, had been made a standing offer by a gallery to purchase one of his paintings for $150,000. At shows and luncheons of the art community he had previously rejected the entreaties, knowing the painting to be worth at least twice as much. On the latest occasion of a luncheon at which Ravi was deliver an art commentary to the guests, the gallery made its offer once more. To himself, Ravi considered the offer and concluded he could use the charitable tax relief that such a sale at a loss would generate. In the course of his speech, he acknowledged and accepted the offer. Two days later, Ravi's lawyer advised him that the purchasing gallery was NOT a charitable foundation, and no tax deduction for such a "donation" could be expected. Ravi then refused to sell the painting to the gallery. On the strength of the verbal agreement of purchase and sale made in the presence of witnesses, the gallery sued Ravi for breach of contract, and for a decree of specific performance to compel Ravi to sell it the painting. Ravi may successfully plead that his words were agreement in principle only.

Question 40

Ravi, an art collector, had been made a standing offer by a gallery to purchase one of his paintings for $150,000. At shows and luncheons of the art community he had previously rejected the entreaties, knowing the painting to be worth at least twice as much. On the latest occasion of a luncheon at which Ravi was deliver an art commentary to the guests, the gallery made its offer once more. To himself, Ravi considered the offer and concluded he could use the charitable tax relief that such a sale at a loss would generate. In the course of his speech, he acknowledged and accepted the offer. Two days later, Ravi's lawyer advised him that the purchasing gallery was NOT a charitable foundation, and no tax deduction for such a "donation" could be expected. Ravi then refused to sell the painting to the gallery. On the strength of the verbal agreement of purchase and sale made in the presence of witnesses, the gallery sued Ravi for breach of contract, and for a decree of specific performance to compel Ravi to sell it the painting. The gallery can successfully answer all of Ravi's case by raising the parol evidence rule.

Question 41

Sandra offered to purchase Jean's car for $3,500, and Jean accepted this offer. This contract was reduced to writing and signed by the parties, when Sandra discovered that Jean was searching for an evening gown to wear to a social affair some months in the future. Sandra offered then to make a dress for Jean, if Jean would accept $3,200 for the car. Jean agreed to the modification and in return for Sandra's cheque in the amount of $3,200 gave her the keys to her car. Sandra finished the dress in time for the social event; however Jean was not pleased with the final result, and declaring it worthless to her, returned the dress to Sandra and brought an action on the face of the written contract for the $300 balance outstanding. Discuss the legal issues raised in this fact situation, its likely resolution, and treat explicitly how Sandra may counter in procedural terms with a defence against the document for $3,500, which is clear on its face and bears her signature.

Question 42

The act of putting a contract under seal was born in the King's Courts of the 13^th century. It was used as an expression of the intent to be bound by the person making the contract to which the seal was affixed. Today in some provinces formal agreements such as power of attorney and a deed of land must bear a seal to be made enforceable.

Question 43

The Consumer Protection Act says that the parties to a contract must each have a copy of the contract or it will not be enforceable. Tim and Tess go to the Rapacious Furniture Co. to buy a couch. They have saved $500 from their salaries as employees in a sheltered workshop for the developmentally handicapped and do not intend to spend more than that, but the salesman takes advantage of their slower thought processes to fast-talk them into a couch which costs $1,200, the balance of which they must pay for in installments of $50 per month, a sum which is really beyond their means. Having read a book on contract law, the salesman makes sure that all the formalities are followed when Tim and Tess sign the contract, and he makes sure he gives the couple one copy of the contract and keeps one for Rapacious' files. Tim and Tess realize later that day that they cannot afford the couch and they ask Rapacious to tear up the contract. They are upset to find out that the furniture salesman will not do so. Can you advise them of any way out?

Question 44

Raimondo has been named as executor of his father's estate. Raimondo's father was a very wealthy man who had made a lot of money in real estate and then reinvested his money in mutual funds and other long-term investments. This left few of his finances in a position to be quickly liquidated. Since his father's death, bills have been piling up and creditors are starting to knock on his door. Raimondo has decided that, because there is no way to utilize his father's money in the near future, he will pay the debts out of his own pocket, and be reimbursed later from his father's estate. Raimondo is allowed to do this, but must clearly state the intention in writing as outlined in the Statute of Frauds.

Question 45

Randy, an avid hunter, wishes to build a hunting cabin for himself and his companion to use during hunting season. He travelled around the area and found a farm that had an ideal piece of land. Randy telephoned the farmer and asked to meet him over coffee. Bob, the farmer, decided to sell Randy the lot for $3,000. Randy agreed, handing Bob $500 in cash as a deposit. When Randy arrived for hunting season three months later, having erected a cabin in the summer, he offered Bob another $1 000 towards the purchase price. However, he found quite a surprise. Bob decided he no longer wishes to sell the land, and informs Randy he will have to tear down his building. Bob tells Randy that he may do this because they did not have a written agreement.
Apply the four criteria of the "doctrine of part performance" to the circumstances and explain their relevance to both Randy's arguments and Bob's defence.

Question 46

Collateral agreement is defined as an agreement that has its own consideration and does not support another agreement.

Question 47

The Carpenters bought a house from the Taylors for $250,000, paying a $25,000 deposit with the balance of $225,000 to be paid on the closing date. To save money on lawyers, they used a standard contract purchased from a stationery store. Thinking that the appliances, drapes and carpets, which the Taylors were to sell them for $5,000, could not be included in a contract for the sale of real estate, the Carpenters simply agreed to that verbally, and paid the extra $5,000 on the date of closing. They were horrified to arrive at their new house and find no carpets, drapes or appliances. The lawyer to whom they went said, "You have nothing here that says they are selling you those things."
a. What rule of law would the lawyer tell them about which could cause them difficulty in suing the Taylors for the missing furnishings, and how would it apply in this case?
b. What solution could the lawyer suggest, once she knew all the facts, and how would it apply in this case?
c. If the verbal agreement about the furnishings had been made sometime after the contract of purchase and sale, would the same problem exist and why or why not?

Question 48

To comply with either the Statute of Frauds or most statutory writing requirements, evidence of the contract in writing needs to be embodied in a formal document.

Question 49

Power of attorney is a legal document usually signed under seal in which a person appoints another to act as his or her attorney to carry out the contractual or legal acts specified in the document.

Question 50

Karen, a marketing consultant, entered into an agreement with Better Life Consumer Products Co. whereby she agreed to assist in test marketing their products for a year. The verbal agreement was made on June 12^th, and Karen was to begin work for the firm on November 1^st of that year. The contract was to terminate on November 1^st of the following year. Better Life offered to prepare a formal agreement for her signature which would be available for signature on her first day of work. However, the August prior to her starting work, Better Life was forced to drop plans to test market their intended products as a result of a patent infringement suit. They notified Karen that there was no need for her services
Discuss Karen's rights (if any) and Better Life's position at law.

Question 51

Joyce's son, Al, borrowed money from Verity Finance. He lost his job last month and has not made the latest payment on the debt. When Verity's collections department telephones, Joyce answers the phone. She agrees to make the payments if Al does not because she is worried about his state of mind due to his job loss. If Verity, without Joyce's knowledge, extends the time Al has to make the payments but increases the interest rate by ½%, because he explains about his job loss, they could no longer enforce Joyce's promise, regardless of whether or not it was in writing and signed by her.

Question 52

Audrey agrees verbally to do some repair work on the retaining walls in Douglas's terraced gardens. After she has turned down another contract from someone else, Douglas tells her he has changed his mind. It is now too late to get the other contract. Since the contract concerning the work on Douglas's land was a verbal one, Audrey cannot enforce it due to the Statute of Frauds.

Question 53

A verbal contract concerning the sale of land to Jack by Jill will not be enforceable by either one of them unless it can be shown that the one who wishes to enforce it dealt with the land as if there was such a contract and no other interpretation could be put on their actions; that the non-enforcement would perpetrate a fraud and a hardship on the one who wishes to enforce it; and there is clear verbal evidence, such as witnesses to the transaction, to establish that there was such a valid verbal contract between them.