Question 1

Willis and Leslie orally agree to the sale of a parcel of land for $50,000:one-half payable now as a down payment;one-half payable in 30 days at the time of closing when the title will be transferred.The buyer,Willis,is to have possession immediately.Willis pays Leslie $25,000,takes possession of the land,and starts building a house.At the time of closing,Willis has made a substantial beginning on the house.However,Leslie refuses to transfer the title,claiming the oral contract is not enforceable.This contract is:
A)enforceable,because the statute of frauds does not apply to this interest in land.
B)unenforceable,because there is no writing signed by Leslie.
C)enforceable,because Willis has partially performed the oral contract and made improvements on the land.
D)unenforceable,because the parol evidence rule applies.

Accepted Answer

While the oral contract is not enforceable under the statute of frauds, Willis has partially performed the contract by taking possession of the land and making improvements. This doctrine is called part performance and allows the court to enforce an oral contract for the sale of land if the buyer has partially performed the contract. Therefore, the contract is enforceable.

Question 2

Whittle sent an order over the Internet for a $1,200 garage door.His name keyed onto the order will only be effective as a signature sufficient to create a "writing" "signed by the party against whom enforcement is sought" if he follows up with a signature on paper.

Accepted Answer

False

Question 3

Robin and Bellman,both merchants,orally agree to a contract for the sale of $5000 of accessories.Bellman,the buyer,sends to Robin,the seller,a written confirmation of the sale,which is sufficient against Bellman under the statute of frauds and which Bellman signs.Robin does not sign.Robin fails to perform the contract and does not ship out the goods.Bellman sues.This contract is:
A)unenforceable,because Robin did not sign any contract.
B)unenforceable,because Bellman did not pay for the goods.
C)enforceable,because Bellman sent the written confirmation of the sale,thereby partially performing the contract.
D)enforceable even without Robin's signature because both parties are merchants.

Accepted Answer

The contract is enforceable even without Robin's signature because both parties are merchants. Under the UCC, if two merchants orally agree to a contract for the sale of goods at a price of $500 or more, and one of them sends a written confirmation of the agreement, which is sufficient against the sender, and the other party does not object in writing within 10 days, the contract is enforceable against the objecting party, even though they did not sign the confirmation. In this case, Bellman sent the written confirmation, which is sufficient against him, and Robin did not object in writing within 10 days. Therefore, the contract is enforceable against Robin.

Question 4

Sweet Plantation,Inc.made a written contract with Candy,Inc.whereby Sweet Plantation agreed to supply all of Candy's sugar requirements for the next year at $.25 per pound.A dispute arose as to how much sugar Sweet is to supply.The parol evidence rule will bar Sweet's introduction of evidence concerning the intent of the requirements of Candy.

Accepted Answer

The parol evidence rule only applies to oral or written evidence that contradicts or varies the terms of a written contract. Evidence of the intent of the parties is not subject to the parol evidence rule and may be introduced to clarify ambiguous terms in the contract. Therefore, Sweet Plantation may introduce evidence of the intent of the sugar requirements in the contract with Candy, Inc.

Question 5

Any contract involving a sale of goods of $100 or more must be in writing.

Accepted Answer

The Uniform Commercial Code (UCC) requires a contract for the sale of goods priced at $500 or more to be in writing to be enforceable, not $100. This threshold has been updated to $5,000 in the amendments to the UCC Article 2, but the original statement is incorrect based on the traditional $500 rule.

Question 6

Hannah orally agrees to sell her house to Brett for $175,000.If she delivers the deed to Brett with the expectation of payment in two weeks and he fails to pay,most courts will not enforce the contract since it was not in writing.

Accepted Answer

While a contract for the sale of real property generally needs to be in writing to be enforceable under the statute of frauds, there is an exception known as part performance. If Hannah delivers the deed and Brett takes possession of the property, makes improvements, or pays part of the purchase price, this may be considered part performance and could make the oral agreement enforceable. Additionally, some states have different variations of the statute of frauds and may have different rules for enforcing oral contracts for the sale of real property.

Question 7

Rest Well Hotel orally ordered 1,000 blankets monogrammed with its initials,RWH,from TriColor Textiles.TriColor had just finished monogramming the blankets when Rest Well called and canceled the order.TriColor will be able to enforce the agreement even though there was no writing.

Accepted Answer

While some contracts must be in writing to be enforced, this agreement does not fall under those requirements. The fact that TriColor had already finished monogramming the blankets shows that there was clear acceptance and consideration by both parties, which creates a valid oral contract.

Question 8

Bry,Inc.and Gangl Co.entered into an oral agreement for the sale of 3,000 sweaters.Both parties performed as required under the contract.Bry delivered the sweaters and Gangl accepted and paid for them.Since the contract is fully executed,it makes no difference that it was oral.

Accepted Answer

Since both parties performed as required under the contract and it is fully executed, the fact that it was oral does not matter.

Question 9

The original statute of frauds is the English law that began the practice of requiring written evidence of certain kinds of contracts,but now the British government has repealed the writing requirement for most contracts.

Accepted Answer

The statement accurately describes the history and current status of the statute of frauds in England.

Question 10

Amanda,a recent university graduate,needed a car to get to her new job.To help Amanda secure a loan for the car,Ted,a friend,agreed to pay the loan should Amanda default.Ted's promise to pay the loan is a collateral promise.His promise must be in writing to be enforceable.

Accepted Answer

According to the statute of frauds, a collateral promise to pay another person's debt must be in writing to be enforceable.

Question 11

In order to satisfy the statute of frauds,a writing must:
A)be a formal written document drafted by an attorney.
B)be signed by the defendant and contain the name of each party,the subject matter of the agreement,and the essential terms and promises.
C)be notarized.
D)All of the above.

Accepted Answer

The correct answer is B because the writing must be signed by the defendant and contain the name of each party, the subject matter of the agreement, and the essential terms and promises. It does not necessarily have to be a formal written document drafted by an attorney, nor does it need to be notarized.

Question 12

For the purposes of the statute of frauds,an interest in land includes:
A)a house.
B)a real estate mortgage.
C)an easement.
D)All of the above.

Accepted Answer

An interest in land includes all of the above options, which are a house, a real estate mortgage, and an easement. Therefore, any agreement related to these interests must be in writing to be enforceable under the statute of frauds.

Question 13

Patrick owned an acre of land which was being divided into building lots.Nancy was interested in purchasing the corner lot.In a signed writing,Patrick stated "I will sell Nancy Grimes a lot on Route 70 for $5,500 cash,payable on April 30,2012." This writing is sufficient under the statute of frauds to make the contract enforceable.

Accepted Answer

The answer of Patrick owned an acre of land which...

Question 14

The Uniform Commercial Code provides that,under certain circumstances,a merchant may be liable on a written contract,even though that merchant has NOT signed it.

Accepted Answer

Under the Uniform Commercial Code, if a merchant receives a written confirmation of a contract and does not object to its contents within 10 days, they may be bound to the terms of the contract even if they did not sign it themselves. This is known as the "confirming memo" rule.

Question 15

Ramona,age 42,orally agreed to work for Brahma,Inc.for the rest of her life for $50,000 per year.This agreement would not be enforceable since it violates the one-year rule of the statute of frauds.

Accepted Answer

The answer of Ramona,age 42,orally agreed to work for Brahma,Inc.for...

Question 16

Tuan is president and sole shareholder of Entertainment,Inc.Entertainment,Inc.wishes to borrow money,but to do so,the bank requires Tuan to orally agree to personally pay the debt of the corporation if Entertainment,Inc.cannot.Tuan's guarantee to repay is:
A)enforceable under the parol evidence rule.
B)unenforceable because there is no insurable interest.
C)enforceable because of the leading object rule.
D)unenforceable because it is a collateral promise.

Accepted Answer

The leading object rule states that if the main purpose of the guarantor's promise is to secure the creditor's performance by the principal party, the promise is enforceable even if it is not in writing. In this case, Tuan's guarantee to repay the debt of Entertainment, Inc. is to secure the corporation's ability to borrow money from the bank, which is the leading object of the transaction. Therefore, Tuan's oral agreement to personally pay the debt of the corporation is enforceable under the leading object rule.

Question 17

Either party may demand rescission of a fully executed oral contract if it was required to have been in writing under the statute of frauds.

Accepted Answer

The answer of Either party may demand rescission of a...

Question 18

Under the statute of frauds,the writing must:be signed by the defendant;and must state with reasonable certainty the name of each party,the subject matter of the agreement,and all of the essential terms and promises.

Accepted Answer

This accurately summarizes the requirements of the statute of frauds.

Question 19

Raymond agrees to transfer an easement right to Sandra for $1,000.This contract is within the statute of frauds and therefore needs to be in writing to be enforceable.

Accepted Answer

This contract involves the transfer of an interest in real property (an easement), which falls under the statute of frauds and requires a written agreement to be enforceable.

Question 20

Parol evidence refers to anything (other than the written contract itself)that was said,done,or written before or as the parties signed the contract.

Accepted Answer

Parol evidence refers to any external evidence that might bear on the interpretation of the contract, including statements made by the parties, previous drafts of the agreement, and other documents or communications exchanged during the negotiation process.

Quiz 14: Written Contracts