Question 1

Grain Co-op LLC and Hearty Cereals Inc. discuss the terms of a contract for deliveries of corn over a two-year period. This transaction falls within the provision of the Statute of Frauds involving
A)collateral promises.
B)the one-year rule.
C)all of the choices.
D)transfers of interests in real property.

Accepted Answer

The one-year rule of the Statute of Frauds requires certain contracts to be in writing to be enforceable, specifically those that cannot be performed within one year from the date of the agreement. Since the contract discussed involves deliveries over a two-year period, it falls under this provision.

Question 2

Dick's Burgers enters into an oral contract with Equipment Warehouse for the purchase of a single-spindle milkshake mixer for $300. Assuming the terms can be proved, the contract is enforceable by
A)Dick's or Equipment.
B)the manufacturer of the mixer.
C)any third party with a material interest, such as one of Dick's suppliers.
D)none of the choices.

Accepted Answer

The contract between Dick's Burgers and Equipment Warehouse is enforceable by either party involved in the agreement (Dick's or Equipment) because it meets the criteria for a valid contract (offer, acceptance, and consideration) and does not violate the Statute of Frauds, as goods under $500 do not necessarily require a written contract to be enforceable.

Question 3

Representatives of Oil Inc. and Petro Corporation discuss the terms of a contract for shipments of refined oil. Petro e-mails Oil a note that summarizes the points on which they agreed. Between these parties, there is
A)an oral contract only.
B)a tentative contract only.
C)a written contract.
D)no contract.

Accepted Answer

The email summarizing the agreed points between Oil Inc. and Petro Corporation serves as evidence of a written contract. This is because it documents the terms of their agreement regarding the shipments of refined oil, making it more than just an oral or tentative agreement.

Question 4

Merl buys a tablet for $500, running shoes for $200, and a set of the Game of Crowns books for $100. To be enforceable as a contract, a writing is required for the purchase of
A)the books, the shoes, and the tablet.
B)the shoes and the tablet only.
C)the tablet only.
D)the books only.

Accepted Answer

Under the Statute of Frauds, a contract for the sale of goods over $500 requires a written agreement to be enforceable. Therefore, only the tablet, which costs $500, necessitates a writing.

Question 5

Guardian Security Inc. and Hedge Fund Corporation enter into an oral contract under which Guardian agrees to provide services for Hedge's offices for as long as needed. This contract may be enforceable by
A)Guardian only.
B)Hedge only.
C)any interested third party, such as one of the firms' employees.
D)either Guardian or Hedge.

Accepted Answer

This contract, despite being oral and for an indefinite period, can be enforceable by either party involved in the agreement (Guardian Security Inc. or Hedge Fund Corporation) if they can prove the existence and terms of the contract through their actions, invoices, payments, or any other form of evidence. Contracts do not necessarily need to be in writing to be enforceable, especially for services that can be terminated at will by either party.

Question 6

Natalie promises to pay for medical services provided by Otto to Polly. Natalie receives no personal benefit for the promise. To be enforceable, the promise must be in writing if
A)Natalie promises to pay only if Polly does not pay.
B)Natalie assumes primary financial responsibility for the cost.
C)Otto's services will be provided in installments with separate payments.
D)Polly also promises to pay.

Accepted Answer

Under the Statute of Frauds, a promise to answer for the debt of another (a suretyship provision) must be in writing to be enforceable unless the main purpose of the promise is to secure a personal benefit for the promisor. In this scenario, since Natalie receives no personal benefit and promises to pay only if Polly does not, it falls under the suretyship provision, requiring a written agreement to be enforceable.

Question 7

Rough Canyon Adventures Inc. and Swampcraft Inc. enter into an oral contract for Swampcraft's sale to Rough of five rafts for $2,000 each. Before Rough takes possession of the rafts, this contract is enforceable by
A)Swampcraft only.
B)Rough only.
C)any interested third party, such as a Rough tour guide or client.
D)none of the choices.

Accepted Answer

Under the Statute of Frauds, contracts for the sale of goods priced at $500 or more must be in writing to be enforceable. Since the contract between Rough Canyon Adventures Inc. and Swampcraft Inc. involves the sale of goods (rafts) for a total of $10,000 and is oral, it does not meet the requirements set by the Statute of Frauds and is therefore not enforceable by any party.

Question 8

Farah agrees to assume a debt owed by Guitars Inc. to Home Bank. The agreement is not in writing. To be enforceable under the "main purpose" rule, the promise must be for the benefit of
A)any third party, such as a Guitars Inc. customer.
B)Farah.
C)Guitars Inc.
D)Home Bank.

Accepted Answer

The "main purpose" rule allows an oral promise to assume the debt of another to be enforceable if the main purpose or leading object of the promisor is to secure a personal benefit. In this case, for the agreement to be enforceable under this rule, the promise must be primarily for the benefit of Farah, the one making the promise.

Question 9

Physicians Clinic orders by phone seven cases of disposable nitrile gloves from Quality Medical Supplies, Inc. After three cases are delivered and accepted, the clinic repudiates the contract. Quality Medical can enforce the contract to
A)any extent because the order was placed orally.
B)no extent because the order was placed orally.
C)the extent of the three accepted boxes.
D)the extent of the four undelivered boxes.

Accepted Answer

The clinic's acceptance of three cases constitutes partial performance, which under the Uniform Commercial Code (UCC), allows Quality Medical to enforce the contract to the extent of the goods accepted.

Question 10

Omar orally agrees with Pi Pizza to provide delivery service to its customers for nine months. This contract is enforceable by
A)none of the choices.
B)either Omar or Pi.
C)any interested third party, such as a Pi customer.
D)Pi only.

Accepted Answer

Oral contracts are generally enforceable, including those for services that can be completed within a year. In this case, since the agreement is for nine months, it falls within that category, making it enforceable by either party involved in the agreement.

Question 11

Elena offers to invest a certain amount in Falco's business if Falco marries Elena's daughter Glenna. This promise is enforceable
A)only if it is in writing.
B)only if the amount of the investment is more than $500.
C)only if Glenna agrees to marry Falco.
D)under no circumstances.

Accepted Answer

This type of promise falls under the Statute of Frauds, which requires certain contracts, including those made in consideration of marriage, to be in writing to be enforceable.

Question 12

Lew tells a representative of Music Inc. that he will pay for Nora's trumpet if she does not. Lew does not secure any personal benefit for this promise. This promise is enforceable as a contract
A)any of the choices.
B)only if Nora agrees to it.
C)only if the value of the trumpet is more than $500.
D)only if it is in writing.

Accepted Answer

Lew's promise is considered a suretyship, which under the Statute of Frauds requires a written agreement to be enforceable if the primary party (Nora) fails to pay. This is because Lew is guaranteeing the debt of another without receiving any personal benefit, making a written agreement necessary for enforceability.

Question 13

Real Fries Inc. and Spud Farm discuss periodic deliveries of potatoes. Despite the absence of an invoice or other writing evidencing the terms of a deal, Spud begins to perform, and Real accepts the deliveries but refuses to pay. As a contract, this arrangement is most likely enforceable against
A)neither party.
B)Spud only.
C)Real only.
D)Spud and Real, at least to the extent of the performance.

Accepted Answer

Under the Uniform Commercial Code (UCC), a contract for the sale of goods can be found enforceable based on the parties' conduct, even in the absence of a written agreement, especially when one party has begun performance and the other party has accepted it. In this case, since Spud began delivering potatoes and Real accepted these deliveries, a contract is implied by their actions, making it enforceable against both parties to the extent of the performance.

Question 14

Lumber LLC files a suit against Mill Company to enforce an oral contract that would otherwise be unenforceable under the Statute of Frauds. The court could enforce such a contract if
A)Lumber foreseeably and justifiably relied on Mill's promise.
B)Mill denies the existence of any contract.
C)neither party has begun to perform.
D)the deal does not involve customized goods.

Accepted Answer

The court could enforce an oral contract that would otherwise be unenforceable under the Statute of Frauds if there was foreseeable and justifiable reliance on the promise by one party. This principle is known as promissory estoppel, which can apply when one party has relied on the promise of the other to their detriment.

Question 15

Solar Power LLC and Trey enter into an oral contract under which Solar agrees to provide Trey with lifetime employment. This contract may be enforceable by
A)Trey only.
B)Solar only.
C)any interested third party, such as a Solar supplier.
D)either Solar or Trey.

Accepted Answer

Contracts for lifetime employment can be enforceable if they meet certain criteria, such as clarity in terms and mutual agreement. Since the contract is between Solar Power LLC and Trey, either party may seek to enforce the contract if they believe the terms are not being met. Interested third parties, such as a Solar supplier, would not have standing to enforce the employment contract.

Question 16

Daredevil Rides Inc. owes debts to Equipment Company and Food Supplies, Inc. Equipment orally agrees to assume Daredevil's debt to Food to prevent the concessionaire from filing a suit against Daredevil. This agreement is enforceable by
A)none of the choices.
B)Daredevil, Equipment, or Food.
C)Daredevil only.
D)Equipment only.

Accepted Answer

This agreement is enforceable by Daredevil, Equipment, or Food because it is a novation where Equipment agrees to assume Daredevil's debt to Food, which can prevent legal action against Daredevil. This creates obligations and rights among all parties involved.

Question 17

Gusher Irrigation Inc. and Heartland Farm enter into a contract for a sale of irrigation equipment for $50,000. To be enforceable, the contract should be in writing and identify
A)the source of payment.
B)the price.
C)the terms of payment.
D)the quantity.

Accepted Answer

Under the Uniform Commercial Code (UCC), a contract for the sale of goods priced at $500 or more must be in writing and must include a quantity term to be enforceable.

Question 18

Pumps Inc. agrees to assume a debt of Quality Parts Company to Reliable Finance LP. The agreement is not in writing. To be enforceable, the promise must be for the benefit of
A)all of the choices.
B)Pumps.
C)Quality.
D)Reliable.

Accepted Answer

For the promise to be enforceable without being in writing, it must be for the benefit of the party assuming the debt, which in this case is Pumps.

Question 19

Hardware Store Company and Indestructible Tools Inc. sign a written contract for a sale of goods. To be enforceable, this written contract must include
A)a correct title, such as "Purchase Order" or "Sales Invoice."
B)a date, such as "October 2019" or "10/2019."
C)a quantity term, such as "50 hammers" or "100 boxes of assorted nails."
D)the parties' contact information.

Accepted Answer

A written contract for the sale of goods must include a quantity term to be enforceable, specifying the amount of goods to be sold.

Question 20

ActioNOW and Becca enter into an oral contract in which Becca agrees to work on a project for ActioNOW for eighteen months. This contract is enforceable by
A)ActioNOW.
B)Becca.
C)any third party, such as ActioNOW's clients.
D)none of the choices.

Accepted Answer

Oral contracts for services that cannot be performed within one year must be in writing to be enforceable under the Statute of Frauds. Since the contract between ActioNOW and Becca is for eighteen months and is oral, it is not enforceable.

Quiz 16: The Writing Requirement

Grain Co-op LLC and Hearty Cereals Inc. discuss the terms of a contract for deliveries of corn over a two-year period. This transaction falls within the provision of the Statute of Frauds involving

Dick's Burgers enters into an oral contract with Equipment Warehouse for the purchase of a single-spindle milkshake mixer for $300. Assuming the terms can be proved, the contract is enforceable by

Representatives of Oil Inc. and Petro Corporation discuss the terms of a contract for shipments of refined oil. Petro e-mails Oil a note that summarizes the points on which they agreed. Between these parties, there is

Merl buys a tablet for $500, running shoes for $200, and a set of the Game of Crowns books for $100. To be enforceable as a contract, a writing is required for the purchase of

Guardian Security Inc. and Hedge Fund Corporation enter into an oral contract under which Guardian agrees to provide services for Hedge's offices for as long as needed. This contract may be enforceable by

Natalie promises to pay for medical services provided by Otto to Polly. Natalie receives no personal benefit for the promise. To be enforceable, the promise must be in writing if

Rough Canyon Adventures Inc. and Swampcraft Inc. enter into an oral contract for Swampcraft's sale to Rough of five rafts for $2,000 each. Before Rough takes possession of the rafts, this contract is enforceable by

Farah agrees to assume a debt owed by Guitars Inc. to Home Bank. The agreement is not in writing. To be enforceable under the "main purpose" rule, the promise must be for the benefit of

Physicians Clinic orders by phone seven cases of disposable nitrile gloves from Quality Medical Supplies, Inc. After three cases are delivered and accepted, the clinic repudiates the contract. Quality Medical can enforce the contract to

Omar orally agrees with Pi Pizza to provide delivery service to its customers for nine months. This contract is enforceable by

Elena offers to invest a certain amount in Falco's business if Falco marries Elena's daughter Glenna. This promise is enforceable

Lew tells a representative of Music Inc. that he will pay for Nora's trumpet if she does not. Lew does not secure any personal benefit for this promise. This promise is enforceable as a contract

Real Fries Inc. and Spud Farm discuss periodic deliveries of potatoes. Despite the absence of an invoice or other writing evidencing the terms of a deal, Spud begins to perform, and Real accepts the deliveries but refuses to pay. As a contract, this arrangement is most likely enforceable against

Lumber LLC files a suit against Mill Company to enforce an oral contract that would otherwise be unenforceable under the Statute of Frauds. The court could enforce such a contract if

Solar Power LLC and Trey enter into an oral contract under which Solar agrees to provide Trey with lifetime employment. This contract may be enforceable by

Daredevil Rides Inc. owes debts to Equipment Company and Food Supplies, Inc. Equipment orally agrees to assume Daredevil's debt to Food to prevent the concessionaire from filing a suit against Daredevil. This agreement is enforceable by

Gusher Irrigation Inc. and Heartland Farm enter into a contract for a sale of irrigation equipment for $50,000. To be enforceable, the contract should be in writing and identify

Pumps Inc. agrees to assume a debt of Quality Parts Company to Reliable Finance LP. The agreement is not in writing. To be enforceable, the promise must be for the benefit of

Hardware Store Company and Indestructible Tools Inc. sign a written contract for a sale of goods. To be enforceable, this written contract must include

ActioNOW and Becca enter into an oral contract in which Becca agrees to work on a project for ActioNOW for eighteen months. This contract is enforceable by