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Q:
An incidental beneficiary can:
A. sue for nonperformance.
B. acquire rights under the contract.
C. enforce the contract.
D. be a member of the general public.
Q:
In the will, Lydia's mother has named Lydia as the owner of her farm and named her as a beneficiary in her insurance policy. Lydia is:
A. a donee beneficiary.
B. an incidental beneficiary.
C. the assignee by novation.
D. a creditor beneficiary.
Q:
Creditor beneficiaries can:
A. sue both the promisor and promisee.
B. sue only the promisor.
C. sue only for payment of money.
D. sue in breach of insurance contracts.
Q:
The promisor who delegates duties is ______ to the promisee if the party to whom the duties were delegated fails to satisfactorily perform them.
A. liable
B. not liable
C. liable for novation
D. liable to the assignee and not
Q:
Zeta contracts to perform a violin solo for Pat. Zeta assigns the contract to Roy. Is this a valid delegation of duty?
A. There is no valid delegation of Zeta's duty to play because all delegations must be expressly stated in the assignment contract.
B. There is no valid delegation of Zeta's duty to play because the contract is one in which Zeta's personal skill as a musician is an essential part of the agreement.
C. There is a valid delegation of Zeta's duty as Zeta has entered into a novation with Roy.
D. There is a valid delegation of Zeta's duty because Zeta does not want to play for Pat.
Q:
An assignor who assigns the contract will be relieved of the duty to perform to the other party on the original contract when:
A. the assignee gives notice to the other party.
B. there has been a novation of the original contract.
C. the assignee contracts to successfully perform the duties.
D. the contract of assignment explicitly states that the assignor is no longer liable to the other party.
Q:
Once a donee or creditor beneficiary has accepted the contract, the original parties:
A. can cancel the contract if the original contract gives them the right to.
B. can cancel the contract without the third party's consent.
C. can never cancel the contract.
D. can cancel only monetary contracts.
Q:
Carl is a doting father who wants to reward his son, Matt for graduating from college. Carl contracts with a local auto dealer to provide Matt with a new BMW. Under the contract, Carl promises to pay the dealer in exchange for the dealer's promise to deliver the car to Matt. The dealer then backs out of the deal and Matt wants to sue him. In this case:
A. Matt is a creditor beneficiary of the contract and can enforce it against the dealer.
B. Matt is a donee beneficiary of the contract and can enforce it against the dealer.
C. Matt is an incidental beneficiary of the contract and cannot enforce it against the dealer.
D. Matt cannot enforce the contract against the dealer because Carl's promise was gratuitous and therefore unenforceable.
Q:
A donee beneficiary:
A. is a third-party beneficiary to whom a gift of performance is given.
B. is a third-party beneficiary who is no longer a part of an agreement.
C. is a third-party beneficiary who incidentally benefits from a contract.
D. is a third party beneficiary who cannot recover the value of the promised performance.
Q:
Which of the following implied guarantee is made by assignors who are paid for making an assignment?
A. The assignor can enhance the value of the assignment.
B. The assignor has good title to the rights assigned.
C. The contract has been discharged two months prior to assignment.
D. Any written or oral statement representing the claim is genuine.
Q:
When a promisor appoints another person to perform their duties under a contract:
A. it is called an assignment.
B. it is called a delegation.
C. it creates an incidental beneficiary.
D. it creates a donee beneficiary.
Q:
Delegations can be prohibited by:
A. the UCC.
B. the Restatement of Contracts.
C. public policy.
D. involvement of personal rights.
Q:
Rocky, who was voted the most valuable player of NYU's basketball team, can:
A. delegate his duties to another player.
B. cannot delegate due to public policy.
C. cannot delegate as they involved his personal skill.
D. assign his duties to another player.
Q:
Unless an assignment agreement clearly indicates a contrary intent, courts today tend to interpret assignments as including a delegation of the assignor's duties. A promise on the part of the assignee to perform these duties:
A. is not implicit.
B. is enforceable by either the promisor or the assignor.
C. depends on the policy followed by the public.
D. is not enforceable by the assignor.
Q:
A promisor who renders performance to the assignor without notice of the assignment:
A. is still liable under the contract.
B. has no further liability under the contract.
C. creates a novation.
D. cannot be sued for nonperformance.
Q:
Assignees:
A. cannot enforce any rights of assignor against obligator.
B. cannot be liable for duties impliedly delegated with the assignment.
C. can sue the promisor for nonperformance.
D. can acquire greater rights than the assignor has.
Q:
Notice to the promisor is important to address the issues of:
A. liability of the assignee.
B. priority only.
C. liability and priority.
D. validity of the assignment.
Q:
For an assigned claim to be valid:
A. the assignee must have the capacity to contract.
B. the contract must not be illegal or known by the assignor to be voidable.
C. the contract must have been discharged once prior to the assignment.
D. the assignee must have good title before the rights are assigned.
Q:
Why are contracts prohibiting competition with a buyer of a business or an employer assignable?
A. To protect the goodwill of the business.
B. To protect the employees from losing their jobs.
C. To protect the interest of the public.
D. To protect the value of the assets to be sold.
Q:
Which of the following statements is true for assignment of contracts?
A. It represents the transfer of duties to assignees.
B. Rights cannot be sold in an assignment.
C. The assignee is not entitled to the entire performance the assignor had a right to under the original contract.
D. The promisor must render all performance to the assignee.
Q:
Edward owes Frank $100, payable in six months. Frank, who is leaving the country on work, gives his rights to the payment to Marge for $80. Indicate the true statement about this case.
A. Frank is the obligor.
B. Edward owes Marge $80.
C. Edward owes Marge $100.
D. Frank will get $100 from Edward.
Q:
Which of the following contracts can be assigned?
A. Assignment of future wages
B. Employment contracts
C. Contracts promising to deliver goods
D. Contracts involving personal rights
Q:
(p. 298; 299) Assignments of future wages are not effective because:
A. they involve personal relationships.
B. they are contrary to public policy.
C. they materially alter the duties of the promisor.
D. they involve personal rights.
Q:
(p. 298; 299) Which of the following is true for employment contracts?
A. They are assignable.
B. They are contrary to public policies.
C. They are nonassignable.
D. They involve the transfer of duties.
Q:
Transfer of rights is referred to as a(n):
A. assignment.
B. novation.
C. delegation.
D. third-party contract.
Q:
The term delegation refers to the transfer of:
A. rights.
B. duties.
C. duties that a promisor did not want to perform.
D. duties involving the promisor's personal skills.
Q:
The creditor beneficiary has rights against the promisee, but not the promisor.
Q:
Annie buys a car from Honest Bob's Motors. She then sells the car to Michael, who agrees to make the remaining payments Annie owes Honest Bob's. Honest Bob's is a creditor beneficiary of Annie, and can therefore recover the balance due from her only, not Michael.
Q:
An incidental beneficiary cannot enforce a contract.
Q:
Only specified individuals, and not members of the general public, can be incidental beneficiaries of contracts.
Q:
Persons who were not originally parties to a contract may claim some interest in it as assignees, or donee beneficiaries, or creditor beneficiaries.
Q:
Life insurance contracts give the insured the right to change the beneficiary only with the beneficiary's consent.
Q:
Ronny contracted Smiths to supply a Cinderella dress for his niece, Lucie, on her birthday. Since the dress was intended for Lucie, Ronny cannot modify the contract without her consent.
Q:
To make a third party a donee beneficiary, the creation of a gift (intended for the third party) of the contracted performance must be the promisee's primary purpose in contracting.
Q:
Public policy can prevent the delegation of duties.
Q:
According to courts today, an assignment of rights does not imply a delegation of duties.
Q:
The transfer of rights and duties under a contract is called an assignment.
Q:
As a general rule, assignments that do not involve personal relationships or increase the promisor's burden are enforceable.
Q:
Employment contracts are assignable.
Q:
A promisor who renders performance to the assignor without notice of the assignment still bears liability under the contract.
Q:
Assignors who are paid for making an assignment are potentially liable to assignees for certain implied guarantees.
Q:
Contracts that are required to be in writing by the statute of frauds are:
A. all promises for the international sale of goods.
B. contracts transferring an interest in land.
C. contracts predicated on a condition precedent.
D. contracts for the sale of goods costing less than $500.
Q:
As illustrated by the Parol evidence rule, when parties put their agreements in writing, it is wise to leave out any elements that they wish to modify orally.
Q:
Oral evidence may be introduced to help resolve ambiguities in a written contract.
Q:
Oral evidence may be introduced to "fill the gaps" in an incomplete written contract.
Q:
On April 1, 2005 Parker entered an oral contract with Wilkins in which Parker promised to work for Wilkins for three years for a salary of $40,000 per year. On April 5, 2005, Wilkins called Parker and repudiated the contract, stating that he had decided not to hire him after all. If Parker sues Wilkins for breach of contract:
A. Wilkins will win because the contract violates the statute of frauds.
B. Wilkins will lose because the contract is enforceable.
C. Wilkins will win because the contract violates the parol evidence rule.
D. Wilkins will lose because his main purpose in promising to hire Parker was to benefit himself.
Q:
Harold makes an oral agreement to purchase Tina's boat for $700. Under the UCC:
A. the contract is voidable.
B. the contract is barred by promissory estoppel.
C. the agreement is barred by the statute of frauds.
D. the contract can be enforced without a writing.
Q:
The student formerly known as Jim prefers to sign his name with the symbol "$." When signing his lease, he indicated his intent to be bound by placing a "$" on the lease's signature line. This satisfies the statute of frauds' writing requirement.
Q:
The UCC is unique in its approach to the statute of frauds because it recognizes that the basic purpose of the statute of frauds can be satisfied only by writing.
Q:
If the parties used a form contract, or the contract is partly printed and partly written, the printed terms control the written terms if the two conflict.
Q:
If one of the parties drafted the contract, ambiguities are resolved against that party in interpreting it.
Q:
Under the E-Sign Act, digital signatures are given the same effect as written ink on paper.
Q:
Legislative reform at both the state and federal levels have facilitated e-commerce by revising traditional contract rules to include new contract rules for electronic transactions made over the Internet.
Q:
The parties had to rely on the testimony of third persons who were often paid witnesses or friends, and false testimony was common in the original statute of frauds adopted in England in 1677.
TRUE
Q:
A contract may be enforceable if promissory estoppel applies.
Q:
In a guaranty contract, the guarantor's promise must be evidenced by a writing to be enforceable.
Q:
A person's promise made on an original contract is identical to the promise a third party makes on a guaranty contract.
Q:
Under the Statute of Frauds, contracts for the transfer of ownership of land do not need to be in writing.
Q:
A fully executory, bilateral contract that cannot be performed within a year after it is made need not be evidenced by a writing to be enforceable.
Q:
Explain the writing requirement under the UCC and U.N.'s Convention on the International Sale of Goods.
Q:
Why do contracts that involve the executors' agreements to personally pay their decedents' debts that are covered by the statute of frauds to be in writing to be enforceable?
Q:
Helen was the president and 25 percent owner of two companies that served the Uptown Mall. At the request of the mall owner, Helen helped arrange the mall's sale to Saber. To ensure continuity in mall operations, Saber offered to hire Helen as vice-president of its retail division. The terms they allegedly negotiated included a five-year term of employment, renewable for another five years, with termination at the option of either party on six months' written notice. Helen wrote some of the terms up in a letter that Saber orally agreed to but never signed. Helen worked for Saber for 11 months and then was fired without notice. Can Helen enforce the contract?
Q:
What kind of writing is required under the statute of frauds?
Q:
Explain with an example how the parol evidence rule is a potential source of danger for parties who reduce their agreements to written form.
Q:
The parol evidence rule:
A. makes certain classes of oral contracts unenforceable.
B. applies to all contracts for an amount greater than $500.
C. is a potential source of danger for parties who reduce their agreements to written form.
D. provides lenience to the parties if a few terms agreed upon are excluded in writing.
Q:
Which of the following is true about the exception to the parol evidence rule?
A. A party can always introduce proof of an oral agreement made after the writing was created, these subsequent oral modifications of contracts will always be enforceable.
B. A party can introduce oral testimony about the facts and circumstances surrounding the agreement without contradicting its terms.
C. A party can always introduce proof of an oral agreement made before the writing was created, these oral agreements will always be enforceable.
D. If the terms of the writing are unclear, oral testimony can be introduced to aid the court in interpreting the writing.
Q:
Paulsen and Warren enter into a written contract. Warren later sues Paulsen for breaking a certain oral promise that Warren alleges is part of their deal. Paulsen's oral promise is not included in the terms of the written contract. At trial, Warren attempts to introduce evidence about the oral promise, and Paulsen's attorney objects to the admission of the evidence on the ground that it violates the parol evidence rule. A court would refuse to admit evidence about Paulsen's oral promise if:
A. the oral promise was made after the written contract was signed.
B. the oral promise was made before the written contract was signed and contradicts a term of the written contract.
C. the written contract is partially integrated and the oral promise is consistent with the terms of the written contract.
D. the evidence about the oral promise is being offered to prove that Warren entered into the contract as a result of Paulsen's fraud.
Q:
For the requirement that certain types of contracts must be in writing, promissory estoppel is an exception to:
A. collateral guaranty contracts.
B. transfers of interest in land.
C. an executor's agreement to personally pay a decedent's debts.
D. a contract varied by parol evidence.
Q:
"Parol evidence" refers to:
A. the evidence given at a parole hearing.
B. the idea that when the parties to an agreement have expressed their agreement in a complete, unambiguous writing, the writing is the best evidence of their intent.
C. the rule requiring that certain types of perjury (lying under oath) concerning the evidence in a case results in criminal sentences without possibility of parole.
D. the equitable doctrine of promissory estoppel.
Q:
Under the parol evidence rule, parties cannot vary the terms of:
A. a written contract by introducing evidence of terms allegedly agreed on prior to, or contemporaneous with the writing.
B. an oral contract by introducing evidence of a written agreement.
C. a written contract by introducing evidence of another writing produced after the original contract was drafted.
D. an oral agreement by publishing notice of a subsequent modification.
Q:
Which of the following is a basic Code writing requirement?
A. That the entire contract be in writing, always in the form of a letter.
B. That the written evidence indicates the quantity of goods sold.
C. That the written evidence be compulsorily signed by both the parties.
D. That the essential terms of the contract and the parties' signatures were contained in more than one document.
Q:
Terry and Melody have an oral contract for the sale of 100 textbooks at $100 per book. If Terry delivers the books and Melody accepts them, or if Melody pays for the books and Terry accepts payment, which of the following parties can raise the statute of frauds defense?
A. Terry can raise the statute of frauds defense.
B. Only the party to be charged may raise the defense.
C. Neither of them, as the agreement has been performed at least partially.
D. Melody can raise the statute of frauds defense.
Q:
Leroy writes a letter that said, "I agree to sell to Jay 5 modern art paintings" and he signs the letter. What happens according to the code if Jay is a merchant and he receives this writing from Leroy and does not object in writing within 10 days after receiving it?
A. Jay would have a good statute of fraud defense as he has not signed the contract.
B. Jay loses his statute of fraud defense.
C. It will be considered as a void contract.
D. Leroy will be prevented by the statute of frauds to take the case to the court.
Q:
When interpreting contracts, courts:
A. give technical words an ordinary meaning.
B. give ordinary words their usual meaning.
C. give ambiguous words in favor of the party who drafted the contract.
D. give non-technical words any meaning intended by the defendant.
Q:
When a contract is partly printed and partly written:
A. the written terms control the printed terms.
B. ambiguities are resolved in favor of the party who drafted the contract.
C. the printed terms control the written terms.
D. the meanings of printed words are controlled by trade usage.
Q:
Written contracts that call for performance over a considerable period of time and thus increase the risk of faulty or willfully inaccurate recollection of their terms in subsequent disputes are called:
A. long-term bilateral contracts.
B. collateral contracts.
C. guaranty contracts.
D. international contracts between companies in signatory countries.
Q:
State statutes of frauds generally agree:
A. that memorandums satisfying the requirement for a writing need only be signed by the party to be bound.
B. that the entire contract be in writing and that the writing be in a single document in the form of a letter.
C. that only a series of numbers unique to each person printed on a memorandum will suffice as a signature.
D. that the signature should appear on the bottom left corner of the memorandum.
Q:
Under the E-Sign Act:
A. consumer consent need to be given only once when multiple transactions are involved.
B. the price and procedure for withdrawing consent must be spelled out.
C. E-businesses are permitted to impose consent withdrawal fees on consumers in all situations.
D. a digital signature does not have the same effect as one written in ink on paper.
Q:
Under the Uniform Electronic Transactions Act:
A. consent must be affirmatively given each time a transaction is made.
B. consent and withdrawal are identical to that of the E-Sign Act.
C. there are no specific rules governing when consent has been given electronically.
D. a PIN number used to access an ATM is not considered as a digital signature.
Q:
Sunny makes an oral agreement with WudWerks to create 100 custom-made chairs for her restaurant for $14,000. After WudWerks had shifted around their production schedule to produce the chairs, Sunny calls WudWerks and says that she no longer wants the chairs and that their deal is off. Under this scenario:
A. the parties' agreement is executory bilateral.
B. the agreement falls within the statute of frauds exception for specially-manufactured goods.
C. the parties' agreement is collateral.
D. the parties' agreement is unenforceable and the buyer is protected under the statute of frauds.