Question 1

The Uniform Commercial Code sufficiently addresses the concerns that parties have when contracts are made to create or distribute information.

Accepted Answer

The Uniform Commercial Code primarily addresses the sale and transfer of goods, and does not fully address concerns related to contracts made for the creation or distribution of information. Other laws and regulations, such as those concerning intellectual property rights and privacy, may need to be considered in such cases.

Question 2

The rules promulgated by the Restatement (Second) of Contracts often resemble the rules created by Article 2 of the UCC.

Accepted Answer

This is true. Both the Restatement (Second) of Contracts and Article 2 of the UCC provide rules and guidelines for contracts, and there is often overlap in their provisions. For example, both bodies of law address issues such as the formation of contracts, determining the terms of a contract, and the remedies available for breach of contract.

Question 3

Generally, the terms of a standardized contract are negotiable.

Accepted Answer

Frequently,the terms of standardized contracts are nonnegotiable.

Question 4

The UCC imposes a duty of good faith in the performance and enforcement of every contract it covers.

Accepted Answer

The UCC explicitly states that every contract covered by it imposes a duty of good faith in its performance and enforcement. This duty requires parties to act honestly, fairly, and without intention to deceive or take advantage of the other party.

Question 5

Alan and Ben have a contract. Alan has performed 100 percent and Ben has performed 50 percent of it. This contract is now executory.

Accepted Answer

An executory contract is a contract where one or both parties still have performance obligations to fulfill. In this case, Ben still has 50 percent of the contract to perform, making it executory.

Question 6

To qualify as a contract, a set of promises must be based on a voluntary agreement, which is made up of an offer and a(n) _____ of that offer.

Accepted Answer

To form a contract, an offer must be accepted by the other party. Therefore, the correct answer is acceptance.

Question 7

If no Code rule applies to an issue regarding a sale of goods contract, the common law rules apply.

Accepted Answer

This is a basic principle of contract law. If there is no governing statute or code provision that applies to a certain issue in a sale of goods contract, the common law (judge-made law) rules fill the gap.

Question 8

Abby promises to pay Brian $50 if he will mow Abby's lawn. Brian does not promise to mow Abby's lawn; however, later that day, Brian completely and satisfactorily does mow Abby's lawn. This is an example of a unilateral contract.

Accepted Answer

This is an example of a unilateral contract because Abby made a promise to pay Brian if he fulfilled a condition (mowing her lawn), but Brian did not make any promise in return. By mowing Abby's lawn, Brian accepted Abby's offer and fulfilled the condition, creating a binding contract where Abby is obligated to pay him $50.

Question 9

The mutual agreement necessary to create an express contract is evidenced by writing.

Accepted Answer

In an express contract,the parties have directly stated the terms of their contract orally or in writing at the time the contract was formed.However,the mutual agreement necessary to create a contract may also be demonstrated by the conduct of the parties.

Question 10

CISG applies only to sale of goods and commercial parties.

Accepted Answer

The CISG (United Nations Convention on Contracts for the International Sale of Goods) applies only to contracts for the international sale of goods between commercial parties. It does not apply to the sale of services or intangible assets, nor does it bind parties who are not from signatory countries.

Question 11

Jimmy and Pat had a long-standing professional relationship. In 2001, Jimmy's business began experiencing financial strain. The two friends discussed Jimmy's personal problems and financial difficulties, and Pat was concerned about his friend's depressed mental state. In 2003, Pat flew from Atlanta to New York to meet Jimmy. Prior to Pat's flight, Jimmy's employee had faxed copies of various construction contracts and correspondence relating to Jimmy's controversial projects for Pat to review. In late 2005, Pat billed Jimmy for a $40,000 balance that Jimmy owed on the alleged oral contract. In a letter to Pat, Jimmy stated: "I have paid you plenty and will not pay you any more. I have not called for any professional advice since then." Pat filed suit against Jimmy for breach of contract. Will Pat succeed?

Accepted Answer

Pat's discussions with Jimmy and his review of the documents were simply friendly advice and not part of a formal oral contract. Without a clear agreement about payment, Pat cannot succeed in this breach of contract action. Jimmy can argue that he did not receive any professional services from Pat that would require him to pay additional fees beyond what he had already paid.

Question 12

Sometimes, Article 2 of the UCC holds merchants to standards different from the standards it applies to nonmerchants.

Accepted Answer

Article 2 of the UCC defines a merchant as a person who deals in goods of the kind or otherwise by his occupation holds himself out as having knowledge or skill peculiar to the practices or goods involved in the transaction. In certain instances, Article 2 places different standards on merchants compared to nonmerchants. For example, under Section 2-316, merchants may agree to limit or exclude warranties whereas nonmerchants cannot.

Question 13

The essence of a contract is that it is a legally enforceable promise or set of promises.

Accepted Answer

This is a basic definition of a contract - it is an agreement that is legally binding and can be enforced by law.

Question 14

Article 2 of the UCC never applies to mixed goods-services contracts; instead, it treats them as pure service contracts.

Accepted Answer

Article 2 of the UCC applies to contracts for the sale of goods, including mixed contracts that involve both goods and services. However, for mixed contracts, the UCC only applies to the sale of goods portion of the contract, while the service portion is governed by common law or other relevant statutes.

Question 15

Pratt, owner of an appliance store, has a garage sale at his home where he sells old furniture and books. He sells a set of books to his neighbor, Stacey. Pratt is considered a merchant under Article 2 of the UCC in selling the books to Stacey.

Accepted Answer

Pratt is the owner of an appliance store, but he is not selling books in the course of his business as a merchant. The sale of books at his garage sale is considered an occasional or non-commercial sale, and does not make him a merchant under Article 2 of the UCC for that particular transaction.

Question 16

Contracts must always be in writing to be enforceable.

Accepted Answer

Contracts can be enforceable even if they are not in writing, but it may be more difficult to prove the terms of the agreement. However, certain types of contracts, such as those involving real estate or sales of goods over a certain amount, may need to be in writing to be enforceable under the law.

Question 17

Speaking generally, a quasi-contract applies where there has been foreseeable reliance on an express promise.

Accepted Answer

A quasi-contract, also known as an implied-in-law contract, is a legal fiction created by the courts to prevent unjust enrichment. It applies in situations where there is no actual contract between parties, but one party has received a benefit from another party that it would be unjust to retain without paying for it. It does not require an express promise or reliance on such a promise.

Question 18

A contract must be between parties who have _____ to contract.

Accepted Answer

The term "capacity" in this context refers to the legal ability of a party to enter into a contract. For example, minors may lack the legal capacity to contract in certain circumstances. Therefore, option B is the correct answer.

Question 19

Which of the following statements about standardized form contracts is false?

Accepted Answer

Standardized form contracts are usually not negotiable, as they are preprinted and presented on a take-it-or-leave-it basis by the party with the most bargaining power.

Question 20

Which of the following is NOT a basic element of a contract?

Accepted Answer

Goods are not a basic element of a contract. The basic elements of a contract are offer, acceptance, consideration, capacity, and legality.

Quiz 9: Introduction to Contracts