MBE Test 1 Contracts

Question 1

Common Law of Contract modification?

Answer 1

Requires additional consideration to be enforceable

Question 2

What kind of situation is “permanent” employment?

Answer 2

At will

Question 3

What damages are a victim of a breach entitled to?

Answer 3

Those that are unavoidable. Not taking reasonable steps to mititgate defeats any claim for consequential damages

Question 4

Limit to unjust enrichment?

Answer 4

Cannot exceed contract amount, unforeseeable cannot be recovered

Question 5

Shift of loss of a shipment Contract?

Answer 5

Shipment contract presumed where K requires shipment by a 3rd party, risk shifts to buyer upon seller’s delivery to the carrier

Question 6

What happens when identified goods are destroyed & neither party at fault

Answer 6

The K is avoided and each party is relieved of it’s respective obligation to perform

Question 7

Revocation when an offer invites performance?

Answer 7

Offeree’s beginning of performance creates an option K, which precludes offeror from revoking

Question 8

When can a seller treat a buyer’s failure to specify as a breach?

Answer 8

When the buyer’s failure to specify materially impacts seller’s performance (ex: seller no longer had candy bars on hand because sold between agreed specify date and date specified) UCC sec. 2-311

Question 9

Can a buyer be found liable for conversion?

Answer 9

YES, if they properly reject the item and then excercise ownership over it ex selling it to a third party

Question 10

Remedy for conversion?

Answer 10

Fair market value at the time of conversion. if item, was sold by df, that sale price is credible evidence of FMV at the time UCC 2-601

Question 11

Condition exception to Parole evidence rule

Answer 11

to establish an oral condition to the parties’ performance under the contract, which if not satisfied would discharge the other party’s duty to perform

Question 12

Can a later writing be used to satisfy S.O.F?

Answer 12

YES ex; a written repudiation of an oral K would make it enforceable even if original agreement was not bc of SOF

Question 13

Repudiation

Answer 13

Centers upon

• an overt communication of intention or
• an action which renders performance impossible OR demonstrates a clear determination not to continue with performance

Question 14

Resell goods option following repudiation?

Answer 14

YES, and then recover difference if second sale was made in good faith and was commercially reasonable, if a private sale, notice of intent to resell must be given to repudiated buyer

Question 15

When does repudiation constitute a breach?

Answer 15

If either party repudiates the K wiht respect to perofrmance not yet due, the loss of which would substantially impair the value of the K to the other party

Question 16

Non-breaching party’s response to breaching repudiation?

Answer 16

aggrevated party may for a reasonable time wait for performance by repudiating party OR resort to a remedy for breach

Question 17

When assent is induced by fraud or misrepresentation, the Contract is…

Answer 17

VOIDABLE NOT VOID

Question 18

Does the CL or UCC govern?

Answer 18

Goods: UCC, Services: CL
Mixed: Predominant purpose test

Question 19

When can oral agreement evidence be admitted when there is a subsequant written K?

Answer 19

Parole evidence Rule: Depends on whether the parties intended the subsequent written K to be a complete & exclusive statement.