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Law
Q:
Explain the test for mental incapacity in contract law.
Q:
When entering into a contract, parties are expected to exercise reasonable judgment.
Q:
Courts will often allow a party to avoid responsibility when the party has made a promise carelessly.
Q:
Explain the limitations on a minor's right to disaffirm a contract.
Q:
Why do the courts require minors to pay the reasonable value of necessaries they receive under a contract they are permitted to disaffirm?
Q:
People lacking mental capacity:
A. can disaffirm their contracts.
B. cannot disaffirm their contracts.
C. are liable for the reasonable value of necessaries.
D. don't need to return any consideration they have received.
Q:
Which of the following statements is true?
A. Minors who have lied about their age can disaffirm their contracts.
B. A comatosed person is regarded as legally having the capacity to contract.
C. For a person adjudicated insane, his/her personal representatives cannot ratify the contract.
D. People who regain their mental capacity can ratify their contracts.
Q:
In cases involving contractual incapacity caused by insanity:
A. the contract is always void.
B. the contract is always estopped.
C. the rules regarding necessaries are basically the same as in the case of minors.
D. the rules state that the person must be accompanied by at least two witnesses at the time of contracting.
Q:
A contract is voidable due to:
A. lack of capacity because of felony.
B. adjudication of insanity.
C. ratification by minors.
D. lack of capacity because of minority.
Q:
Ratification of a contract which is voidable for lack of capacity:
A. must be in writing.
B. can occur at any time after the contract is made.
C. cuts off the right to disaffirm.
D. must always have at least two witnesses present at the time of contracting.
Q:
Dax, 15, bought a diamond ring from a local jewelry store. The jeweler was aware of his age. He made a partial payment on the ring of $100. Ten months later, Dax's girlfriend broke off the engagement, but refused to return the ring. Dax asked the jeweler to repossess the ring, but the jeweler took no action. Dax sought to disaffirm the contract for the ring, and the jeweler argued that he could not do so without returning the ring. Can Dax disaffirm?
Q:
When a person has been adjudicated insane:
A. the court rules that the person is of unsound mind but has lucid moments.
B. most states hold that the contracts of such persons are voidable.
C. the court appoints a guardian or conservator for the person's estate.
D. the court says that such a person is liable for any value of necessaries.
Q:
In most states, the agreements of people who have been adjudicated insane are ____.
A. valid
B. void
C. voidable
D. unenforceable
Q:
_____ means that a general hearing was held on the person's mental competency, and the court determined that the person was of unsound mind and appointed a guardian or conservator of the person's estate.
A. Emancipation
B. Adjudication
C. Incapacitation
D. Ratification
Q:
People who regain their mental capacity:
A. can disaffirm for a reasonable time after regaining mental capacity.
B. can ratify their contracts.
C. are still considered to be insane for a reasonable period of time.
D. cannot ratify their contracts.
Q:
A person lacking mental capacity must return the other party to status quo when:
A. the other party was aware of the person's lack of mental capacity.
B. the person lacking mental capacity has already enjoyed the product of the agreement.
C. the other party was unaware of the person's lack of mental capacity.
D. the person lacking mental capacity has passed on the product of agreement to someone else.
Q:
If a court later finds that a person lacked mental capacity at the time a contract was entered into, that contract is:
A. still valid.
B. voidable.
C. automatically void.
D. disaffirmed.
Q:
According to the theory of incapacity, people are presumed to lack the capacity to contract if they are _____.
A. mentally ill
B. obese
C. felons
D. diabetic
Q:
Under which of the following situations can a person suffering from mental impairment have the legal capacity to contract?
A. If the contract is for necessaries provided by parents.
B. If the person is married.
C. If the person is intoxicated from drugs or alcohol, but is not mentally retarded.
D. If the person entered a binding contract during a lucid moment.
Q:
Whether an item can be considered "necessary":
A. depends on the circumstances of the agreement.
B. depends on the minors' station in life.
C. doesn't depend on who provides for it.
D. doesn't depend on the minors' age.
Q:
Under which of the following circumstances can minors disaffirm a contract?
A. The minor has not ratified the contract upon reaching majority.
B. The contract is for real estate.
C. The minor has given a false statement about his/her age.
D. The minor is required to place the adult in status quo.
Q:
What is the term used to describe the termination of a parent's right to receive services and wages from a child and to generally control him?
A. Emancipation
B. Disaffirmation
C. Ratification
D. Incapacity
Q:
In which of the following ways do courts prevent minors, who misrepresent their age, from defrauding adults?
A. By requiring the minor to place the adult in status quo.
B. By holding the minor to his/her spoken statements which clearly indicate intent to be bound by the contract.
C. By ratifying the minor before he/she turns adult.
D. By proving them incapable of being held in a contract.
Q:
_____ is/are essential to a minor's continued existence and general welfare.
A. Considerations
B. Emancipation
C. Forbearance
D. Necessaries
Q:
Jessica, a minor, rented an apartment in Greenwich Village for $800 a month. She signed a one-year lease. After living there for three months, Jessica decided to move to another apartment complex. She is liable for the reasonable value of three months' rent at Greenwich Village, but not for the remaining nine months' rent. This is in accordance with the _____ provision of capacity to contract by minors.
A. disaffirmation
B. necessaries
C. emancipation
D. adjudication
Q:
A minor's contract for necessaries is:
A. unenforceable.
B. estoppable.
C. voidable.
D. binding on a quasi contract theory.
Q:
"Status quo ante" means:
A. that minors can lose the right to disaffirm if they fraudulently misrepresent their age.
B. "the condition beforehand," or the position one would be in if a given contract had never come into existence.
C. "the state sets the ante," or that the basic risks of entering into contracts are not protected by the state.
D. that a minor is totally protected by law on all counts of misbehavior.
Q:
Under the common law, minors:
A. are entitled to the return of their property given as consideration only upon attaining majority.
B. are entitled to the return of their property given as consideration even if they have been ratified.
C. are entitled to the return of their property given as consideration, even if that property is possessed by a third party at the time of disaffirmation.
D. are not entitled to the return of their property given as consideration.
Q:
Chuck Olson, aged 17, bought a used car from Bobby Duncan on September 15, 2006, agreeing to pay Duncan $200 a month for 12 months. On October 6, 2006, Olson was involved in an accident that damaged the car. On October 7, 2006, Olson told Duncan he wanted to disaffirm the contract for the purchase of the car. Olson attained the age of majority on October 8, 2006. If Duncan sues Olson, in most states he will:
A. win, because Olson did not disaffirm until after reaching the age of majority.
B. win, because Olson was unable to return the car.
C. lose, even though Olson cannot return the car.
D. lose, because Olson did not ratify the contract on the day he attained majority.
Q:
Hans bought a stylish sports car when he was 15. Two weeks after he turned 18, he sold the car to his neighbor. In this scenario:
A. Hans may disaffirm the contract even after he sold the car.
B. Hans can disaffirm the contract as it was never a valid ownership.
C. Hans may recover the cost of the car from the dealer who sold it to him when he was 15.
D. Hans cannot disaffirm the contract because he sold the car.
Q:
What is the term used for the willingness of adults who indicate an intent to be bound by contracts entered while still minors?
A. Ratification
B. Disaffirmance
C. Emancipation
D. Forbearance
Q:
Under the Uniform Commercial Code, minors who disaffirm their contracts involving goods:
A. can reclaim the goods even from third parties.
B. can no longer reclaim those goods from innocent third parties.
C. have to return consideration even if the goods have been consumed.
D. have to return consideration even if it has been stolen from them.
Q:
Which of the following is true for a contract made by a minor?
A. It is voidable.
B. It cannot be disaffirmed during minority.
C. It is barred from ratification.
D. A minor's capacity to contract is never presumed.
Q:
In a contract made by a minor:
A. adult parties to the contract can disaffirm.
B. the minor has the right to disaffirm.
C. his/her siblings who are also minors can disaffirm the contract on his/her behalf.
D. the minor can disaffirm the contract anytime even after attaining majority.
Q:
When a minor reaches the age of majority, he/she:
A. may disaffirm a contract for a reasonable time after reaching majority.
B. can no longer be ratified.
C. must put his intent to disaffirm in writing shortly before reaching majority.
D. should renew his contract in order to disaffirm the contract legally.
Q:
A minor can disaffirm a contract made for ____.
A. real estate
B. life insurance
C. educational training
D. bank accounts
Q:
A person could be medically insane but still have the legal capacity to contract.
Q:
In most states, the agreements of persons who have been adjudicated insane are void.
Q:
Once a mentally impaired person regains his mental capacity, he may ratify a contract he made while he was impaired.
Q:
If a person is adjudicated insane, his/her personal representative cannot ratify the contract.
Q:
Emancipation gives a minor the capacity to contract.
Q:
Minors are generally held liable on a quasi contract basis for the reasonable value of necessaries furnished to them.
Q:
Minors are liable for the value of necessaries they have purchased under a contract but have not received at the time they disaffirm.
Q:
Many states treat intoxicated persons like people who lack mental capacity if, at the time they entered the agreement, they were so intoxicated that they were unable to understand the nature of the business at hand.
Q:
Performing a part of the contract after attaining majority, such as making payments or accepting some performance under the contract, is not enough for ratification.
Q:
Minors who successfully disaffirm a contract are not entitled to the return of any consideration they have given the adult party to the contract.
Q:
Minors are entitled to the return of their property given as consideration, even if that property is possessed by a third party at the time of disaffirmance.
Q:
Explain with an example how promissory estoppel affects consideration?
Q:
If either party entering a contract lacks the capacity to contract, the contract is void or voidable.
Q:
Capacity to contract is presumed and a party claiming incapacity bears the burden of proof.
Q:
Minors' contracts are not voidable.
Q:
If the minors' contract involves title to real estate, the minor cannot disaffirm until reaching majority.
Q:
Explain an illusory promise and provide an example.
Q:
Abel had grown tired of working on the family farm and was considering moving away. However, his parents told him "If you'll stay and help us, we'll leave you the farm when we die." As a result, Abel decided to stay on the farm and worked there for the next twenty years. However, when his parents finally died Abel learned that they had left the farm to his brother, Mark. Abel filed suit against his parents' estate to enforce their promise of leaving him the farm. Which of the following is a true statement?
A. Abel gave no consideration for his parents' promise to leave him the farm, so their promise is not enforceable against the estate.
B. The work that Abel did on the farm before his parents made their promise is sufficient consideration to make their promise enforceable.
C. Abel's parents' promise is not enforceable because it was illusory.
D. Abel's parents' promise is enforceable under a promissory estoppel theory.
Q:
Which of the following, used to enforce promises, is supported by consideration?
A. Illusory promise
B. Preexisting duty
C. Charitable subscriptions
D. Past consideration
Q:
Watten Construction contracted to build the Sillimans a house for $50,000. When Watten began digging the foundation, it hit bedrock, which was highly unusual in that area. Watten told the Sillimans that he required an extra $5000 to build the house. The Sillimans agreed, but when the house was done, refused to pay Watten any more than the original contract price. What can be the outcome if Watten sues the Sillimans for the extra $5000 and why?
Q:
Explain the difference between a liquidated and an unliquidated debt.
Q:
Explain forbearance to sue in relation to consideration.
Q:
Past consideration is sometimes accepted for ____.
A. official duties
B. for legal obligations
C. moral obligations
D. charitable donations
Q:
Which of the following is worded in a way that allows the promisor to decide whether or not to perform the promise?
A. Novations
B. Compositions
C. Illusory promises
D. Modifications
Q:
Composition agreements are:
A. made in a way that allows the promisor to decide whether or not to perform the promise.
B. agreements between a debtor and two or more creditors who agree to accept a stated percentage of their liquidated claims against the debtor at or after the due date.
C. agreements entered into when someone promises not to file a legal suit in exchange for a promise to pay a certain sum of money or some other consideration.
D. agreements between a debtor and a creditor who agree to accept a stated percentage of their liquidated claims against the debtor after the due date.
Q:
Forbearance occurs when:
A. a debtor and two or more creditors agree to accept a stated percentage of their liquidated claims against the debtor.
B. someone promises not to file a legal suit in exchange for a promise to pay a certain sum of money or some other consideration.
C. promises are worded in a way that allows the promisor to decide whether or not to perform the promise.
D. there is no dispute about the existence or the amount of the debt.
Q:
According to the rule of _____ if a promisee's performance was rendered before the promisor's promise was made, then it can never serve as consideration, even though it may meet the "legal value" part of the test.
A. past consideration
B. preexisting duty
C. forbearance
D. promissory estoppel
Q:
_____ is the legal term for settling a disputed claim.
A. Accord and satisfaction
B. Forbearance
C. Compositions
D. Promissory estoppel
Q:
An unliquidated debt is defined as:
A. one that has not been paid in full.
B. one that involves an honest dispute about the existence or amount of the debt.
C. one that is unenforceable due to lack of consideration.
D. one that is due and certain with no dispute about the existence or the amount of the debt.
Q:
If the amount of a debt is "due and certain":
A. a promise to pay less than the amount lacks consideration.
B. the debt is considered to be an unliquidated debt.
C. there is a dispute about the existence of the debt.
D. a promise to pay more than the amount lacks consideration.
Q:
Which of the following statements is true about unliquidated debts?
A. The amount being due and certain, a promise to pay less lacks consideration.
B. Some courts allow collection of the remainder if checks marked "payment in full" are cashed without reservation.
C. Since the amount is genuinely in dispute, an agreement resulting in accord and satisfaction is enforceable.
D. Composition agreements are an exception to unliquidated debts and can be enforced without additional consideration.
Q:
On January 1, 2006 Bev owed $5,000 on her car loan. The loan was due in May 2006. On January 1, 2006, Bev sent the lender a check for $4,000 marked "in full payment" of the loan. The lender cashes the check. Under these circumstances:
A. the lender can sue Bev for $1,000.
B. the lender has not promised to accept the payment as "payment in full."
C. Bev can avoid paying the $1,000.
D. Bev has not given consideration.
Q:
Randy asked Carl to detail his brand-new sports car by painting flames on the side of the vehicle. After the parties signed a contract and after Carl had already started to paint, Randy decided that he wanted Carl to also install a new stereo system in the car. Carl sued Randy for modifying the existing contract without any prior intimation; but he lost the lawsuit because:
A. Randy's act was unenforceable for lack of consideration.
B. Randy's promise was enforceable.
C. The old contract automatically got cancelled with the addition of a new condition.
D. Carl's act was not a preexisting duty and hence of no legal value.
Q:
When a contracting party runs into unforeseeable difficulties that make his/her performance impossible, courts will:
A. not enforce a modification that is not supported by new consideration.
B. prosecute the contracting party on criminal charges.
C. enforce a modification in the interest of fairness.
D. will make the contracting party pay up in full.
Q:
Under section 2-209 of the UCC, agreements to modify existing contracts for the sale of goods:
A. need new consideration to be binding.
B. need no new consideration to be binding.
C. require parties to formally terminate their original agreement and start over.
D. requires just an informal agreement to be enforced.
Q:
Under the UCC, if the original agreement requires any modification to be in writing, an oral modification is:
A. unenforceable.
B. enforceable.
C. enforceable if the value of the goods exceeds $500.
D. unenforceable if the value of the goods exceeds $200.
Q:
Which of the following statements is true about the modification of an existing contract under the UCC?
A. It regards all contractual duties as preexisting duties.
B. If new consideration is provided to support a modification, it is unenforceable.
C. A promise to alter an existing contract for sale of goods is enforceable.
D. Unforeseeable difficulties that made performance impossible or highly impractical can make promise unenforceable.
Q:
Which of the following is true about preexisting duty?
A. Agreeing to perform a preexisting duty is consideration.
B. A promisor's promise not to commit a crime is consideration.
C. Promises by public officials to perform official duties are consideration.
D. Performing a preexisting duty is not consideration.
Q:
Gregg Biglieri moves into a tough Philadelphia neighborhood and opens a repair shop. He is harassed by the local gang leader who wants to extort money from him. He promises to pay Johnson, a police officer whose beat includes Gregg's store, $50 a week to "keep an eye on the store" while walking his beat. Which of the statements is true with respect to Gregg's situation?
A. The local gang leader will keep his promise of not harassing Gregg for money as long as Gregg pays him $50 a week.
B. The cop can sue Gregg for not keeping his promise of paying 50$ per week.
C. Johnson being a public officer, his duties towards Gregg is not consideration.
D. In this case, Gregg is the promisee and Johnson is the promisor.
Q:
If a professor charges extra fees to take a regularly scheduled class, it would not be taken as a consideration because:
A. such an act is prohibited by promissory estoppels.
B. such an act would violate the preexisting duty rule.
C. you have already paid your tuition fee which also includes the test fee.
D. such an act is a tort.
Q:
Shoddy Roofing Company agrees to do the roofing on a building owned by Tacky Construction Company for $50,000. One week after Shoddy finishes work, over 20% of the shingles fall off due to improper installation. Tacky promises Shoddy an additional $10,000 to reinstall the fallen shingles, and Shoddy does so. Then Tacky refuses to pay Shoddy more than $50,000 for the work. Identify the true statement with regard to this situation.
A. Shoddy is not entitled to any more than $50,000 for its work.
B. Tacky owes Shoddy the additional $10,000.
C. Shoddy would still be entitled only to $50,000 if the shingles had fallen off due to an unforeseeable earthquake hitting the building.
D. Shoddy would still be entitled only to $50,000 if the parties had voluntarily cancelled their original contract and entered a new one for $60,000.
Q:
On October 29, 1989, Al Glitz agrees to paint Georgia's house during the Thanksgiving week for $4,000 in exchange for Georgia's promise to pay him $4,000 in cash immediately upon completion of the work. Which of the following statements is true with regard to this case?
A. Georgia could hire another painter on October 31 without legal liability to Al because until he has painted the house, he has not given any consideration for Georgia's promise to hire him.
B. Al could back out of the deal on October 31 without legal liability to Georgia because she has not given any consideration for Al's promise to do the work until she pays him.
C. Both parties are bound on October 29 because each has given consideration for the other's promise, and neither may back out without legal liability.
D. Al could back out of the deal on October 29 without legal liability if he could prove that $4,000 was inadequate consideration to paint Georgia's house.
Q:
In general, performing a preexisting duty:
A. is consideration.
B. is not consideration.
C. is consideration only if the preexisting duty is substantial.
D. does not involve contractual duties.
Q:
Polly promises to pay city council member Smith $500 to show up for the weekly council meetings. Polly's promise is:
A. supported by consideration.
B. wholly enforceable.
C. not supported by consideration.
D. supported by conditional consideration.