Deck 4: Contract Law and the Hospitality Industry

Question 1

The following is an offer: "We have the following rooms available at the following prices: those with ocean views are $135 per night; those without an ocean view are $112; those in the adjoining building are $98."

Answer 1

True

Question 2

Which of the following is not an essential element of a contract?

A) Contractual capacity
B) Consideration
C) A writing
D) Legality

Answer 2

C

Question 3

Which of the following is not covered by the statute of frauds?

A) A hotel hires the services of a gardener.
B) A restaurant hires a banquet manager on a three-year contract.
C) A hotel contracts for the purchase of a two-acre parcel of property on which the hotel plans to expand.
D) The parents of a bride promise a hotel they will pay for the bridal suite if the bride and the groom fail to pay.

Answer 3

A

Question 4

Matt contracted to purchase a computer at age 16. Until when can he disaffirm the contract?

A) He cannot cancel it at any time.
B) He can disaffirm the contract until his eighteenth birthday.
C) He can avoid the contract while he is under 18 and for a reasonable period of time after he reaches age 18.
D) He can avoid the contract anytime until he reaches age 21.

Question 5

A contract made by a person who lacks contractual capacity is void.

Question 6

For a plaintiff to collect money in a breach of contract case, the plaintiff must prove that it attempted to mitigate the loss.

Question 7

Which of the following is not true about the statute of frauds?

A) Initials on a writing are sufficient in lieu of a signature.
B) Two pieces of paper can be used together to make up the necessary writing.
C) The required signature is that of the plaintiff in a lawsuit.
D) A note or memorandum may be sufficient to satisfy the writing requirement.

Question 8

What is the effect of a counteroffer?

A) No contract results unless the counteroffer is accepted.
B) The counteroffer creates a contract.
C) A contract results, but it is voidable at the option of the offeror.
D) A contract results, but it is voidable at the option of the offeree.

Question 9

A void contract is unenforceable in court.

Question 10

Which of the following has contractual capacity?

A) A person age 17
B) A mentally incompetent person
C) A very intoxicated person
D) A person ill with flu

Question 11

A breach of contract is a crime.

Question 12

Which of the following involves an intention to mislead?

A) Fraud
B) Innocent misrepresentation
C) Mistake
D) Breach of contract

Question 13

The Namberry Hotel had a minimum two-nights stay during the summer weekends. This arrangement was announced in all its advertisements and explained to all who inquired about reservations. Sam made a two-night reservation and paid in advance. After spending one night at the hotel, he decided to leave. True or false: Sam is entitled to a return of his advance payment for the second night.

Question 14

A hotel is remodeling its lobby. The manager negotiated a contract for the work with a construction company and was about to sign it. The hotel manager then decided that installation of four additional wall plugs not referenced in the contract were needed. The owner of the construction company only orally agreed to add the four plugs. The hotel manager thereafter signed the contract, which did not make reference to the additional plugs. True or false: The hotel manager can enforce the company's promise to install the four extra plugs.

Question 15

A guest with a one-night guaranteed reservation at a hotel did not show. The hotel was not able to rent the room to someone else. For which of the following is the guest liable to the hotel?

A) Loss of goodwill
B) The full hotel bill
C) Punitive damages
D) None of the above

Question 16

Jan made reservations at a hotel for three nights and paid a deposit of one night's charge. Due to family illness, she was forced to cancel the reservations. The hotel was able to rent the room to someone else. True or false: The hotel is entitled to retain Jan's deposit due to breach of her contract.

Question 17

After an offer is made, a contract results whether the offeree accepts or rejects.

Question 18

Andrea had reservations at a hotel but, because it overbooked, she was forced to stay elsewhere. The only hotel in town with vacancies was more expensive. Rather than return home, Andrea took a room in that hotel. For which of the following is the first hotel liable to reimburse Andrea?

A) Mental anguish suffered by Andrea.
B) The amount Andrea had to pay at the second hotel in excess of the cost of the room at the first hotel.
C) The full hotel bill paid by Andrea at the second hotel.
D) None of the above; the hotel does not have any liability in this situation.

Question 19

Pain and suffering is recoverable in a breach of contract lawsuit.

Question 20

Which of the following is not a contract?

A) A restaurant purchases a month's supply of condiments from a supplier and pays the agreed price.
B) A hotel delivers newspapers to its guests' rooms at no charge.
C) A snowplower agrees to plow a restaurant's parking lot in exchange for free meals.
D) A hotel hires a banquet manager at an agreed salary.

Question 21

A 14-year-old who lives in the north purchases a winter coat and wears it for a few weeks. Thereafter he seeks to return the coat. He will not be successful because a winter coat is a ____________________ in the north.

Question 22

____________________ is a favorable reputation producing an expectation of future business.

Question 23

If one party to a contract made a unilateral mistake, the contract is voidable.

Question 24

The purpose of the ______________________________ is to protect written contracts from modifications by alleged oral agreements made prior to signing.

Question 25

In contract terms, how would you describe the following: "If the price is right, I will consider selling the chandelier in the lobby"?

Question 26

A 600-room hotel is sold out for the weekend. To accommodate the anticipated diners in the restaurant, the restaurant manager ordered a larger quantity of fresh fish to be delivered by noon on Friday. The supplier failed to provide the fish. As a result, the hotel was unable to serve many items on the menu and lost business. To mitigate the loss, the restaurant should have ____________________________________________________________.

Question 27

An oral contract made by a restaurant for the purchase of a freezer for $1,100 is enforceable in court.

Question 28

_________________________, one of the essential elements for a contract, means that the parties have truly agreed to the terms.

Question 29

The following is an offer: "We have chicken, fish, and meat entrees."

Question 30

Mutuality is established by an offer and an ____________________.

Question 31

A representative from the National Association of Freelance Writers (NAFW) contracted with a hotel for convention services. After the contract was signed, the hotel orally agreed to include light hors d'oeuvres for a cocktail party without additional charge. True or false: The agreement for hors d'oeuvres is enforceable by the NAFW.

Question 32

Grilled black bass is a very popular selection at the Colligan Restaurant. Due to toxic levels in the local river, the health department has prohibited eating bass caught there. Due to the popularity, however, the restaurant continues to serve the river bass. True or false: Diners who are served the bass from the river are legally obligated to pay for their own dinners.

Question 33

_________________________ refers to practices generally adhered to in a particular industry and are used to clarify an ambiguity in a contract.

Question 34

An important reason for putting all contracts in writing is to avoid the _________________________ associated with oral contracts.

Question 35

A primary reason that a contract for a catered event should be in writing is ____________________________________________________________________.