Highly Confusing Contracts Principles

Question 1

What is required to create an interest in land?

Answer 1

A promise creating an interest in land must be evidenced by a writing.

Question 2

What types of agreements are included under interests in land?

Answer 2

Agreements for the sale of real property and other agreements pertaining to land.

Question 3

List the important interests in land generally covered by the Statute.

Answer 3

• Leases for more than one year
• Easements of more than one year
• Mortgages and most other security liens
• Fixtures
• Minerals or structures if severed by the buyer

Question 4

What happens to fixtures or minerals if they are severed by the seller?

Answer 4

They are not an interest in land but rather are considered goods.

Question 5

What is the classification of growing crops or timber to be cut attached to realty?

Answer 5

It is a contract for the sale of goods.

Question 6

True or False: A contract to build a building creates an interest in land.

Answer 6

False

Question 7

True or False: A contract to buy and sell real estate and divide the profits creates an interest in land.

Answer 7

False

Question 8

What is the minimum price for goods to be subject to specific rules in the Statute of Frauds?

Answer 8

$500 or more

Question 9

What are the three main situations in which a contract is removed from the Statute of Frauds?

Answer 9

• Performance
• Admissions in Pleadings or Court
• Merchants Confirmatory Memo Rule

Question 10

What is the doctrine that allows a seller to enforce an oral promise to pay if they have fully performed?

Answer 10

Doctrine of Part Performance

Question 11

What constitutes sufficient part performance for land sale contracts?

Answer 11

• Payment (in whole or in part)
• Possession
• Valuable improvements

Question 12

What type of performance allows a purchaser of land to enforce an oral contract in equity?

Answer 12

Specific performance only

Question 13

In sale of goods contracts, what conditions allow a contract to be taken out of the Statute of Frauds?

Answer 13

• Goods have been specially manufactured
• Goods have been either paid for or accepted

Question 14

What is required for services contracts that cannot be completed within one year to be enforceable?

Answer 14

Full performance by one party

Question 15

What is the legal principle that may allow a meritorious claim to bypass the Statute of Frauds?

Answer 15

Equitable and Promissory Estoppel

Question 16

True or False: Courts may apply equitable estoppel when a defendant falsely tells a plaintiff that a contract is not within the Statute.

Answer 16

True

Question 17

What happens if a party asserting the Statute of Frauds defense admits to an agreement in pleadings or testimony?

Answer 17

The Statute is treated as satisfied and the contract will be enforced without a writing

Question 18

What is the excuse of condition by hindrance or failure to cooperate?

Answer 18

A legal principle where a party is excused from fulfilling a condition due to the other party’s obstruction or lack of cooperation.

This principle emphasizes the importance of mutual cooperation in the performance of contractual obligations.

Question 19

What does the excuse of condition by actual breach entail?

Answer 19

It refers to a situation where a party is excused from performing a condition due to the other party’s actual breach of contract.

This means that if one party fails to fulfill their contractual obligations, the other party may be relieved from their own obligations.

Question 20

Define the excuse of condition by anticipatory repudiation.

Answer 20

This occurs when one party indicates, before the performance is due, that they will not perform their contractual obligations.

Anticipatory repudiation allows the non-breaching party to take action immediately rather than waiting for the breach to occur.

Question 21

What is meant by the excuse of condition by prospective inability or unwillingness to perform?

Answer 21

A situation where a party is excused from a condition due to a reasonable belief that the other party will be unable or unwilling to perform in the future.

This can arise from circumstances that indicate a high likelihood of non-performance.

Question 22

Explain the excuse of condition by substantial performance.

Answer 22

This principle allows a party to be excused from strict compliance with a condition if they have substantially performed their obligations.

Substantial performance means that the essential purpose of the contract has been fulfilled, even if there are minor deviations.

Question 23

What does the excuse of condition by ‘divisibility’ of contract mean?

Answer 23

It refers to the concept that a contract can be divided into separate parts, and a party may be excused from performing certain conditions if they have performed other divisible parts.

This applies particularly in contracts that can be logically separated into distinct segments.

Question 24

What is the excuse of condition by waiver or estoppel?

Answer 24

This principle occurs when a party voluntarily relinquishes their right to enforce a condition or is prevented from asserting a condition due to their previous conduct.

Waiver involves intentional relinquishment, while estoppel prevents a party from asserting something contrary to what is implied by a previous action or statement.

Question 25

What are advertisements, catalogs, and circular letters typically construed as?

Answer 25

Mere invitations for offers ## Footnote They announce prices at which the seller is willing to receive offers.

Question 26

Why are advertisements usually not considered offers?

Answer 26

They are indefinite as to quantity and other terms, and addressed to the general public.

Question 27

What might happen if an advertisement to the general public were considered an offer?

Answer 27

It might be over accepted, exceeding the number of items for sale.

Question 28

Under what circumstances can courts treat advertisements as offers?

Answer 28

If the language contains a promise, terms are certain and definite, and the offeree(s) is clearly identified.

Question 29

When can price quotations be considered offers?

Answer 29

If given in response to an inquiry.

Question 30

What is the general rule regarding past or moral consideration?

Answer 30

Not sufficient consideration.

Question 31

Why is past consideration not sufficient?

Answer 31

It was not given in exchange for the promise when made.

Question 32

What is the material benefit rule?

Answer 32

Some courts will enforce a promise based on a material benefit previously conferred by the promisee on the promisor.

Question 33

Under what conditions will the material benefit rule apply?

Answer 33

If the promisee did not intend to confer the benefit as a gift.

Question 34

What does the 'bargained-for exchange' element of consideration require?

Answer 34

The promise must induce the detriment and the detriment must induce the promise.

Question 35

What must the act or forbearance by the promisee do in a bargained-for exchange?

Answer 35

Must be of benefit to the promisor.

Question 36

Is it sufficient for the promisee to incur detriment in a consideration?

Answer 36

No, the detriment must be the price of the exchange.

Question 37

What is the test to determine if there is consideration?

Answer 37

Whether the act or forbearance by the promisee would benefit the promisor.

Question 38

Does the benefit to the promisor need to have economic value?

Answer 38

No, it can be peace of mind or gratification.

Question 39

What is required for the promise to establish bargained-for consideration?

Answer 39

The promisee must not already be legally obligated to perform the requested act.

Question 40

What is the Statue of Frauds?

Answer 40

A legal doctrine requiring certain contracts to be in writing to be enforceable. ## Footnote It aims to prevent fraud and perjury in the enforcement of obligations.

Question 41

What does 'No Consideration = Think about Illusory' imply?

Answer 41

It suggests that without consideration, a promise may be deemed illusory and unenforceable. ## Footnote Consideration refers to something of value exchanged between parties in a contract.

Question 42

What should you look up when considering mutual obligation?

Answer 42

The concept of mutual obligation in contracts, which refers to the reciprocal duties of the parties involved.

Question 43

What is required for an executor or administrator to promise personally to pay estate debts?

Answer 43

The promise must be evidenced by a writing.

Question 44

What is a suretyship promise?

Answer 44

A promise to pay the debt of another, which must be evidenced by a writing. ## Footnote This promise arises when one party agrees to take responsibility for another's debt.

Question 45

What type of promise must a suretyship promise be?

Answer 45

It must be a collateral promise.

Question 46

What does it mean for a promise to be collateral?

Answer 46

It means the promise is secondary and related to another person's obligation to pay, rather than a primary obligation.

Question 47

True or False: A promise to pay a debt can be enforced without any writing.

Answer 47

False.

Question 48

Fill in the blank: A promise to answer for the debt or default of another must be evidenced by a _______.

Answer 48

[writing]

Question 49

What are the ways a gratuitous revocable assignment may be terminated?

Answer 49

1. Death of the assignor 2. Bankruptcy of the assignor 3. Notice of revocation communicated by the assignor to either the assignee or the obligor 4. The assignor takes performance directly from the obligor 5. Subsequent assignment of the same right by the assignor to another ## Footnote These methods highlight the various factors that can lead to the termination of a gratuitous revocable assignment.

Question 50

True or False: The death of the assignor is a method of terminating a gratuitous revocable assignment.

Answer 50

True ## Footnote The death of the assignor leads to the automatic termination of the assignment.

Question 51

Fill in the blank: A gratuitous revocable assignment may be terminated by the _______ of the assignor.

Answer 51

bankruptcy ## Footnote Bankruptcy of the assignor affects the validity of the assignment.

Question 52

What must the assignor do to revoke an assignment?

Answer 52

Communicate notice of revocation to either the assignee or the obligor ## Footnote Notice must be clearly communicated to effectively revoke the assignment.

Question 53

True or False: The assignor can take performance directly from the obligor without terminating the assignment.

Answer 53

False ## Footnote Taking performance directly from the obligor is one of the methods that terminates the assignment.

Question 54

Fill in the blank: A subsequent assignment of the same right by the assignor to _______ terminates the earlier assignment.

Answer 54

another ## Footnote This indicates that the assignor cannot assign the same right to multiple parties simultaneously.