Question 1

a. How does Article 2 of the UCC modify the common law of contracts with regard to consideration? 
b. Explain how output and requirements contracts differ from illusory promises.

Accepted Answer

The answer of a. How does Article 2 of the...

Question 2

Orwin, owner of a used furniture store, gives Maggie a signed offer to buy her living room furniture for $800. This offer:

Accepted Answer

Under the UCC, a signed written offer by a merchant to buy or sell goods is irrevocable for a reasonable time, not exceeding three months, even without consideration.

Question 3

There are certain transactions that are enforceable without consideration. These include:

Accepted Answer

All the options listed are examples of transactions that can be enforceable without consideration under certain circumstances.

Question 4

Ken, a research chemist, has been promised a fellowship with a stipend of $10,000 to do research on synthetic fuel oil. Under the terms of the fellowship, Ken is free to use the money as he sees fit. Ken decides to build his own laboratory, so he will not have to rent one. He hires a carpenter who begins working on shelving and cabinets in the laboratory. Then Ken receives a telegram saying the fellowship has been canceled. No reason is given for the cancellation. If Ken sues, will he be able to collect the money from the foundation which promised the fellowship? Explain your answer using legal terminology.

Accepted Answer

The answer of Ken, a research chemist, has been promised...

Question 5

Jason's mother would like him to go to college, so in June he enrolls at the local university. He also quits his job and tells his mother his plans to take classes. His mother says, "I'm so happy that you are going to college that I want to pay for your books." Jason then sends her a bill for $485. Jason's mother's promise is:

Accepted Answer

Jason's mother's promise is unenforceable because it lacks consideration; Jason had already enrolled in school before she made the promise, so there was no exchange or inducement for her promise.

Question 6

Which of the following would not be enforceable without additional consideration?

Accepted Answer

The settlement of an undisputed debt requires additional consideration to be enforceable because there is no dispute over the amount owed, so simply agreeing to pay what is already owed does not constitute new consideration.

Question 7

Andrew agrees to paint Rosalene's house for $500. Two days after he starts the job, he decides that $500 isn't enough money. He refuses to finish the job, unless Rosalene agrees to pay him $100 more. What principle applies to this fact situation?

Accepted Answer

Andrew was already obligated to paint the house under the original agreement, so he provides no additional consideration for the extra $100.

Question 8

Herb promises to give his nephew, Curt, his old TV when the new one he ordered arrives. Explain whether this promise is enforceable, and include in your discussion the concept of "bargained-for exchange."

Accepted Answer

The answer of Herb promises to give his nephew, Curt,...

Question 9

A bank robbery has occurred, and the banker's association has offered a $1,000 reward for information leading to the arrest and conviction of the robber. Several people are claiming to be entitled to the money. Which of them is eligible?

Accepted Answer

An off-duty deputy sheriff from a different county is not obligated to act and can be considered a private citizen, making them eligible for the reward.

Question 10

William agrees to drill a well up to 200-feet deep for John's rural cabin. The contract price is $3,000. After drilling 100 feet, William strikes solid granite rock. He talks to John and explains that this is highly unusual for the area and could not have been anticipated at the time of entering into the contract. He offers to get a special drill, but says it will cost him more money, so that he will be unable to complete the project for the agreed price. Because John is anxious to have the well, he agrees to pay William an additional $1,000 to complete the job. However, once the well is finished, he changes his mind and now says he will pay only the originally agreed-upon amount. What is the result?

Accepted Answer

The parties agreed to a substitute contract due to unforeseen circumstances, which discharges the original contract. John is obligated to pay the additional $1,000.

Question 11

Barbara, a wealthy widow, promises the pastor of her church that she will donate $30,000 to the church to help pay off its mortgage if the stewardship committee can obtain enough pledges for the balance of the $60,000 mortgage. Other pledges are obtained to pay off the mortgage, but now Barbara has changed her mind and plans to take an around-the-world cruise instead. In this case:

Accepted Answer

Barbara's promise is enforceable under the Restatement of Contracts because it was a conditional promise that induced action (obtaining pledges) by the church, creating a reliance interest.

Question 12

In DiLorenzo v. Valve & Primer Corporation , the court held:

Accepted Answer

The court held that there was no consideration for the stock option, and promissory estoppel did not apply because DiLorenzo did not prove detrimental reliance.

Question 13

In a contract for the sale of lawn care services, an issue arises about whether the homeowner would receive disproportionately less in service than the lawn care company would receive in compensation. This disparity may be relevant to the:

Accepted Answer

The disparity in the exchange may be relevant to the availability of certain defenses and remedies, such as unconscionability, which addresses situations where one party receives disproportionately less in a contract.

Question 14

Roberto obtains an exclusive franchise to sell widgets for the Acme Widget Company. The exclusive franchise covers the entire State of Wisconsin for a period of three years. In this case:

Accepted Answer

The answer of Roberto obtains an exclusive franchise to sell...

Question 15

Clint contests the amount of a bill he received from Car Care Specialists. Under the Restatement, settlement of the claim:

Accepted Answer

Under the Restatement, settlement of a claim is valid consideration if the claim is doubtful due to uncertainty as to the facts, as it involves a compromise of a disputed claim.

Question 16

Define legal detriment.

Accepted Answer

The answer of Define legal detriment....

Question 17

Darla offers to pay Edward $6,000 for Edward's car, provided that Darla receives that much from her uncle's estate, which is currently being probated. She expects to know for sure how much she will receive within a week or so. If Edward agrees:

Accepted Answer

The consideration from Darla to Edward is the promise of $6,000, which is subject to the condition of her receiving that amount from her uncle's estate. This makes the contract conditional, not illusory.

Question 18

Which of the following statements best describes charitable subscription promises?

Accepted Answer

Charitable subscription promises are generally enforceable if the charity has relied on the promise or there is a probability of reliance, as this reliance can create a binding obligation.

Question 19

Which of the following are the two basic elements to consideration?

Accepted Answer

Bargained-for exchange and legal sufficiency are the two basic elements to consideration.

Question 20

Is a promise to pay a pre-existing moral obligation enforceable? Explain.

Accepted Answer

The answer of Is a promise to pay a pre-existing...

Quiz 12: Consideration

a. How does Article 2 of the UCC modify the common law of contracts with regard to consideration? b. Explain how output and requirements contracts differ from illusory promises.