Review Questions - Contracts Flashcards
You are an attorney in a small American town. One of your clients asks you to represent her in dealing with a lawsuit being threatened by her next-door neighbor. The neighbor claims that your client promised to pay half the cost of trimming and maintaining several large trees on his property that overhang her property line, and that since that time, he has paid a landscape expert several thousand dollars to do that work. She tells you that although they did discuss it, she never made such a promise. If you undertake to represent her in this matter, in what kinds of legal materials might you find it necessary or appropriate to do research?
(a) Court decisions in your jurisdiction
(b) The Restatement (Second) of Contracts
(c) Statutes in your jurisdiction applying to land use.
(e) The CISG
A, B, & C
Which - if any - of the following statements are definitely true?
(a) In our system of contract law, legislatures make “the law”; courts just apply it to resolve disputes.
(b) Contract law is not concerned with “justice” or “fairness,” but only with enforcing whatever agreement the parties have made.
(c) Legal theory has no relation to the way that courts actually decide cases.
B
Which of the following statements is most likely to be true?
(a) When analyzing a legal problem, an attorney always looks at things in the way most favorable to her client
(b) Many attorney’s seldom if ever appear in court
(c) Attorneys don’t negotiate deals for their clients, they just draft contracts for them.
(d) When a contract dispute arises, it’s likely to end up in court.
A
In Allen v. Bissinger, we have seen an example of a transaction conducted between parties separated by space in which the U.S. mails were used to communicate. The only alternatives at that point in time (1918) would have been telegraph and long-distance telephone, because wireless cellphones and the Internet did not yet exist. Suppose they did, and the parties had been communicating with each other by e-mail. Would that have affected the outcome or the reasoning used by the court in the Allen case?
Xena (X) is a young woman living in Ohio. Recently she wrote the following email to her cousin Yancey (Y), an Indiana resident.
Dear Y: After some consideration, I’ve decided that I need to sell the antique roll-top desk that our grandfather left to me. I need the money, and it takes up a lot of space in my small house. I know you’ve always admired it, so I though I would give you a change to buy it before I put it up for sale on Cragislist. I had it appraised not long age, and I was told that it’s worth at least $15,000. I’d certainly sell if for that, or you could make me an offer. I need to hear from you be the end of the week, f possible. - Fondly, your cousin X
Has X made an offer to Y?
(Question 1)
Yes. X made an offer to Y because an offer is the manifestation of willingness to enter into a bargain so that to justify
Y responds to X’s note the next day, with the following note:
Dear X: Thanks for thinking of me. I’d certainly love to own Grandpa’s desk, but $15K is pretty high for me. I guess I can go up to 12K. Would you take that for it? - Y
Given the facts of Questions 1 and 2, which of the following statement is/are potentially accurate?
(Question 2)
(a) If X’s communication was not an offer, Y’s response is an offer.
(b) If X’s communication was an offer, Y’s response is a counter-offer.
© If X’s communication was an offer, Y’s response necessarily acts as a rejection of that offer.
B & C
After receiving Y’s note on Friday, X answers the same day.
Dear Y: Sorry, but I can’t go as low as that. I know it’s worth at least $15K, and I might be able to get even more. - X
After thinking it over for a few days, Y responds to X on Monday with the following note:
Dear X: It’s a stretch for me, but I hate to see Grandpa’s desk leave the family. I’ll meet your price of $15K. Let me know when I can come to pick it up. - Y
Assuming the facts of Questions 1, 2, & 3, which of the following statements is/are potentially accurate?
(a) Y’s last note to X is an acceptance of X’s original offer
(b) Y’s last note to X is not an acceptance of X’s original offer, because that was terminated by an earlier rejection
© Y’s last note to X is not an effective acceptance of X’s original offer, because it was not communicated in time to be effective.
(d) Y’s last note to X is an offer which Y is free to accept or reject
B
D?
During the December pre-holiday sales period, Donaldson’s Department Store (DDS) had a prominent sign in its window:
ENTER NOW TO WIN A NEW MUSTANG!!!!
Put your name in the box at the customer service counter on the fourth floor of our store. Drawing to be held Jan 2. Not necessary to be present to win. Don’t miss this fabulous once-in-a-lifetime opportunity!!!
While doing her holiday shopping at DDS, Ashley Andrews filled out one of the blank cards provided and dropped it in the box in the DDS store. On Jan. 2, once of the store employees pulled Ashley’s card from the box. The store notified her of that fact, but when she came to claim her prize of a new Ford Mustang automobile, she was given a plastic model of that car. She promptly complained to the manager, who told her that the holiday sales at DDS had been too disappointing to justify awarding her an automobile.
Does Ashley have a valid claim against DDS for a new Mustang (or its value)?
(a) Yes, because the store’s promise was supported by consideration and Ashley reasonably expected to receive an automobile if her name was drawn.
(b) No, because the store got no consideration for its promise.
(b) No, because the store’s statement was ambiguous.
A
Three years ago Chuck Carlson agreed to lease from Lily Landon a vacant storefront in which Chuck intended to operate a gourmet food shop, “Chucky’s Cheese.” The term of the lease was three years, and the rent provided in the written lease (which was signed by both parties) was $2,000 a month. The lease contained the following provision:
Renewal Option. Tenant is to have the option to renew for an additional three-year period, at the monthly rate of $2,250 or such other amount as the parties may agree to, provided Tenant gives Landlord written notice of intent to renew at least 60 days before the end of the term of this lease.
The shop proved to be successful. When 80 days remained on his lease term, Chuck delivered to Lily a written notice of his intent to renew the lease for three years at the rate of $2,250 per month. Lily stated she would not recognize his right to renew unless he agreed to a monthly rental of $2,500.
Which of the following statements best describes the parties’ legal position?
(a) Chuck cannot enforce the option to renew because it is only an agreement to agree
(b) Chuck can enforce the option to renew, but only if he can demonstrate reliance on the renewal provision in the lease.
© Chuck can enforce the option to renew at the monthly rental of $2,250
(d) Chuck cannot enforce the option to renew unless he can show that Lily is acting in bad faith.
You client Bob, a building contractor, makes many purchases through the exchange of emails. He wants to be able to avoid waiving any rights that he ordinarily would have for legal remedies for defective materials, especially if the defects are discovered only after the materials have been incorporated in a building project, because this could prove very costly for him to repair or replace. Typically, he attached to every email order a set of his own “Terms and Conditions,” which his email order refers to as follows:
By accepting this order you are agreeing to the attached Terms and Conditions, which are part of every purchase contract we make. All inconsistent terms are hereby objected to
The following language appears in Bob’s attached Terms and Conditions form:
Buyer retains all rights under the Uniform Commerical Code to remedies for breach of contract or of warranty, including consequential damages.
Bob has asked you if this language will protect against a seller’s attempt (in “Terms and Conditions” of its own) to disclaim the warranties that would otherwise be implied by law, or to exclude consequential damages as a remedy.
What would you tell him?
(a) The language will absolutely preserve for Bob his legal remedies under the UCC
(b) The language will protect him generally, but not if he or his agent signs a seller’s form that contains terms unfavorable to him
© The effect of his language can be defeated if Bob receives and does not expressly object to a seller’s form that provides “Seller’s Terms and Conditions are part of this contract if Buyer accepts the goods without objecting to them.”
(d) There is no way the buyer can achieve his objective; a seller’s form always has the benefit of being the “last shot” if the buyer accepts the goods.
You client Bob, a building contractor, makes many purchases through the exchange of emails. He wants to be able to avoid waiving any rights that he ordinarily would have for legal remedies for defective materials, especially if the defects are discovered only after the materials have been incorporated in a building project, because this could prove very costly for him to repair or replace. Typically, he attached to every email order a set of his own “Terms and Conditions,” which his email order refers to as follows:
By accepting this order you are agreeing to the attached Terms and Conditions, which are part of every purchase contract we make. All inconsistent terms are hereby objected to
The following language appears in Bob’s attached Terms and Conditions form:
Buyer retains all rights under the Uniform Commerical Code to remedies for breach of contract or of warranty, including consequential damages.
Bob has asked you if this language will protect against a seller’s attempt (in “Terms and Conditions” of its own) to disclaim the warranties that would otherwise be implied by law, or to exclude consequential damages as a remedy.
What would you tell him?
(a) The language will absolutely preserve for Bob his legal remedies under the UCC
(b) The language will protect him generally, but not if he or his agent signs a seller’s form that contains terms unfavorable to him
© The effect of his language can be defeated if Bob receives and does not expressly object to a seller’s form that provides “Seller’s Terms and Conditions are part of this contract if Buyer accepts the goods without objecting to them.”
(d) There is no way the buyer can achieve his objective; a seller’s form always has the benefit of being the “last shot” if the buyer accepts the goods.
