Chapter 12 Flashcards
Settlement of an unliquidated debt is called:
Multiple Choice
A composition agreement
A secured agreement
An unenforceable agreement
An accord and satisfaction
An accord and satisfaction
Sheila was in a dispute with Bob regarding the adequacy of goods supplied under a contract. In an effort to settle the matter, Sheila sends Bob a checked marked “payment in full.” If Bob cashes the check, which would be the result in a majority of states?
Multiple Choice
The court would determine that there was only partial consideration and that Bob can sue for any additional amounts owed.
The court would determine that consideration is absent and that Bob can sue for any additional amounts owed.
The court would rule that while cashing the check worked as an admission on the part of Bob, he was not estopped from pursuing further action against Sheila on the debt.
The court would rule that cashing the check discharged any obligation of Sheila and that Bob would not be able to recover further amounts.
The court would rule that cashing the check discharged any obligation of Sheila and that Bob would not be able to recover further amounts.
Which of the following is true regarding the general rule in regard to the treatment of liquidated debts as opposed to unliquidated debts?
Multiple Choice
That a promise to discharge a liquidated debt for part payment of the debt at or after its due date is enforceable and supported by consideration and that a promise to settle an unliquidated debt is enforceable.
That a promise to discharge a liquidated debt for part payment of the debt at or after its due date is unenforceable due to lack of consideration but that a promise to settle an unliquidated debt is enforceable.
That a promise to discharge a liquidated debt for part payment of the debt at or after its due date is enforceable and supported by consideration but that a promise to settle an unliquidated debt is unenforceable.
That a promise to discharge a liquidated debt for part payment of the debt at or after its due date is unenforceable due to lack of consideration and that a promise to settle an unliquidated debt is unenforceable.
That a promise to discharge a liquidated debt for part payment of the debt at or after its due date is unenforceable due to lack of consideration but that a promise to settle an unliquidated debt is enforceable.
An illusory promise cannot serve as consideration because there is no mutuality of obligation.
true or false
true
Legal value is not the same thing as monetary value.
true or false
true
Courts generally hold that past consideration is sufficient consideration if it is pledged for a current promise.
true or false
false
Bruce’s grandmother told him that she was glad that he finished college and that she would give him $500. Which of the following is true regarding the promise?
Multiple Choice
Bruce gave unliquidated consideration which is sufficient to support an obligation.
Bruce gave no consideration, but this is considered an enforceable composition agreement.
Bruce gave past consideration which is sufficient to support an obligation.
Bruce gave no consideration.
Bruce gave no consideration.
People are not free to make bad bargains.
true or false
false
An agreement 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, in full satisfaction of their claims is a(n):
Multiple Choice
Composition
Unsecured debt
Secured debt
Unliquidated debt
Composition
A promise to make a gift for a charitable or educational purpose is unenforceable unless and until the institution to which to promise was made incurs obligations by relying on the promise. This exception is usually justified on the basis of either __________ or __________.
Multiple Choice
estoppel; public policy
the Statute of Frauds; the applicable statute of limitations
substantial performance; forbearance
criminal law; civil law
estoppel; public policy
A debt that is legitimately disputed as to the amount or existence is known as a(n):
Multiple Choice
Secured debt
Unliquidated debt
Unsecured debt
Liquidated debt
Unliquidated debt
Agreements between a debtor and two or more creditors who agree to accept a stated percentage of their __________ claims against the debtor at or after the due date, in __________ satisfaction of their claims, are known as __________.
Multiple Choice
unliquidated; partial; renditions
unliquidated; partial; requisitions
liquidated; full; rescissions
liquidated; full; compositions
liquidated; full; compositions
Suppose Fong owns a liquor store that has been robbed several times. He promises to pay Kamala, a police officer responsible for patrolling Fong’s neighborhood, $100 per week to “keep an eye on the store” while on patrol. Fong’s promise is enforceable because it is supported by consideration.
true or false
false
The following promises do not need consideration to be enforceable.
Multiple Choice
A composition agreement.
A promise involving a matter other than money.
A promise in which promissory estoppel applies.
A promise not to sue.
A promise in which promissory estoppel applies.
Concerned about barking, Lee pays her neighbor Wanda $100 to refrain from buying a dog. The agreement is:
Multiple Choice
Supported by conditional consideration.
Enforceable by Lee but not by Wanda
Not supported by consideration.
Supported by consideration.
Supported by consideration.
