Question 1

Which of the following is generally considered to be a legal offer?

Accepted Answer

A legal offer requires a clear intention to be bound by the terms upon acceptance. Auctions, advertisements, and price lists are generally invitations to negotiate, not offers.

Question 2

A letter of intent summarizes progress made during business negotiations,but it does not necessarily create a binding contract.

Accepted Answer

A letter of intent is a document that outlines the key terms and intentions of parties involved in negotiations. While it can be used to demonstrate progress, it does not create a legally binding contract.

Question 3

The intent of the offeror to extend an offer to the offeree is generally determined by reference to:

Accepted Answer

The intent of the offeror to extend an offer to the offeree is generally determined by reference to the words and conduct of the offeror rather than the beliefs, assumptions, or subjective intentions of the offeror. This means that the offeror's actions and words that are objectively manifested to the offeree are the key factors in determining whether an offer has been made.

Question 4

John owns a thoroughbred horse named Prince Charming that just ran in the Kentucky Derby.Prince Charming came in last,much to John's frustration and embarrassment.John exclaims in a loud voice,"I'm selling that horse to the first person who hands me $100 bucks!" John has:

Accepted Answer

John's statement could be seen as an expression of frustration and not a serious offer to sell the horse. A "reasonable person" would likely not interpret his statement as a genuine offer to sell the horse for $100. Therefore, no offer has been made.

Question 5

Software clickwrap and shrinkwrap agreements limiting the manufacturer's maximum responsibility to a refund of the purchase price even if the software destroys your hard drive have generally been found to be binding against consumers.

Accepted Answer

Courts have generally upheld clickwrap and shrinkwrap agreements, even when they limit the manufacturer's liability to a refund of the purchase price. However, some consumer protection laws may provide additional rights and remedies.

Question 6

Under the UCC,the mirror image rule applies strictly.

Accepted Answer

Under the UCC, the mirror image rule does not apply strictly. Instead, it allows for variations in accepted terms in a contract as long as they don't materially alter the original offer. This is known as the "battle of the forms" and the UCC provides guidelines on how to resolve conflicts between differing terms in contracts.

Question 7

The Johnsons decided to sell their summer cabin on Beech Lake.They sent flyers out to all who previously had expressed an interest in buying the cabin stating that they were planning on selling their cabin.The flyer described the location of the property,the size of the lot,and the price.If one of the recipients responds by sending a letter accepting,an agreement:

Accepted Answer

The flyer was sent out as an invitation to negotiate, not as an offer to sell. It means that the Johnsons did not intend to enter into a binding agreement with anyone who responded to the flyer. Therefore, no agreement will be formed by someone responding to the flyer.

Question 8

Revocation is the withdrawal of an offer by the offeror.

Accepted Answer

Revocation is the act of withdrawing an offer by the offeror before it has been accepted by the offeree.

Question 9

According to the UCC,one or more open terms will cause a sales contract to fail for indefiniteness.

Accepted Answer

The UCC allows for open terms in a sales contract, such as price or delivery date, as long as the parties have intended to make a contract and there is a basis for giving an appropriate remedy. The contract will not fail for indefiniteness as long as there is a way to supply missing terms through gap-filling provisions provided under the UCC.

Question 10

Candy,Inc.signed an agreement with Sweet Plantation.Under the contract,Candy,Inc.agreed to purchase all the sugar cane Sweet Plantation grew during the coming season.This contract will be unenforceable due to its vagueness.

Accepted Answer

The contract is not necessarily vague if it specifies the details of the coming season, such as the time frame, anticipated quantity, and price.

Question 11

April put an advertisement in the newspaper advertising the sale of her computer for $500.Simultaneously,six people responded to the ad by mail with formal written acceptances.April is bound on six contracts to sell her computer for $500.

Accepted Answer

April only advertised the sale of her computer for $500, she did not enter into any formal written agreements with the six people who responded to the ad. Therefore, she is not bound on six contracts to sell her computer for $500.

Question 12

Regency Construction placed an order for two hundred 2 x 4s from Lumber Jack.If the place of delivery and time for shipping the goods are not specified,the UCC provides:

Accepted Answer

The answer of Regency Construction placed an order for two...

Question 13

Nella offers to sell her crop of strawberries,which have just been picked,to Morgan's Market.Since she does not specify a time limit for acceptance,Morgan's can accept the offer the following week,as long as Nella has not revoked it.

Accepted Answer

The answer of Nella offers to sell her crop of...

Question 14

If the offer does not specify a type of acceptance,the offeree may accept in any reasonable manner and medium.

Accepted Answer

This statement is true. When an offer does not specify a type of acceptance, the offeree has the freedom to accept the offer in any reasonable manner and medium. This could include accepting in person, over the phone, through email or in writing. As long as the acceptance is clearly communicated to the offeror and is made within the timeframe specified in the offer, it is considered valid.

Question 15

You have placed an antique desk up for auction and the auctioneer has not made any special announcements about the sale.You can withdraw the desk at any time before the auctioneer closes the sale by announcement or by the fall of the hammer.

Accepted Answer

As per the statement, the auctioneer has not made any special announcements about the sale, so the seller has the right to withdraw the item at any time before the auctioneer closes the sale by announcement or by the fall of the hammer. Therefore, the statement is true.

Question 16

Farrell Tires makes tires for bicycles.At the beginning of the year,it sends out a price list addressing each type of tire,"To our valued customers." Horner Cycles,a bicycle store,orders a variety of tires at the prices quoted on the price list.Farrell Tires must sell the tires to Horner for the prices quoted on the list.

Accepted Answer

A price list is generally considered an invitation to negotiate or make an offer, not a binding offer itself. Farrell Tires is not legally obligated to sell at those prices unless they explicitly agreed to do so.

Question 17

In seeking to ascertain whether there is a meeting of the minds,the courts use the reasonable person standard to objectively examine the language or actions of the parties.

Accepted Answer

The statement is true. The reasonable person standard is used to objectively examine the language or actions of parties to determine whether there is a meeting of the minds. The standard asks how a reasonable person would have interpreted the situation or contract, rather than relying on each party's subjective intentions or understanding.

Question 18

When Olga asks Sven if he wishes to sell his Harley motorcycle,he replies that he would not sell it "for less than $2,000."Olga replies,"I accept," and hands him $2,000.A contract exists.

Accepted Answer

The answer of When Olga asks Sven if he wishes...

Question 19

On Monday,Harry puts an offer in the mail to Sally to sell his guitar for $50.Monday night when jamming with his buddies,he decides he will really miss his old guitar and has second thoughts about selling it.Tuesday morning he puts a revocation in the mail informing Sally he has changed his mind and the guitar is no longer for sale.The revocation is effective on Tuesday morning.

Accepted Answer

The answer of On Monday,Harry puts an offer in the...

Question 20

In the case Baer v.Chase,the court decided that Chase's promise to remunerate Baer for his services was sufficiently definite to be enforced.

Accepted Answer

The court in Baer v. Chase found that Chase's promise was too indefinite to be enforced as a contract.

Quiz 10: Agreement