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62 Cards in this Set

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Cynthia tells Darryl that she will deliver his boxes of Paradise Cookies as he directs. A declaration that one will do something in the future is part of the definition of

A promise

Bobbie claims that Carly breached their contract. Carly responds that she never intended to enter into a contract with Bobbie. The intent to enter into a contract is determined with reference to

Objective theory of contracts

Ellen offers to sell her math textbook to Julia for $50. Julia does not respond. Ellen and Julia do not have a contract because they lack the requirement of

agreement

Jonah tells Levi he will give him an Xbox if Levi does Jonah's chores for a month. Levi promises to do the chores. Jonah and Levi have formed a
illusory
Cory believes that he and Dian agreed that he would act as her personal sports trainer for seven workout sessions. In a later dispute, the existence of any contract can be judged by
the parties' statements at the time of their alleged contract

Bay City Construction, Inc., a contractor, asks Cool Electric, a subcontractor, to provide certain services. Nothing is said about payment. Cool provides the services, but Bay City refuses to pay. In Cool's suit to recover, the chief issue is most likely to be whether these parties had

?

Opie offers to sell his guitar to Pinky for $200. Pinky agrees. They complete and sign a printed form and Pinky gives Opie a check for the price. The check is

a formal contract

Avatar, Inc., and Bling Corporation sign a contract in which Avatar agrees to deliver t-shirts emblazoned with video game characters in exchange for Bling's promise to pay. Avatar delivers. The contract is

an executory contract

Following negotiations with Coastal Distribution Company, Briggs Trucking, Inc., enters into an informal contract. This means that the parties' contract

is not enforceable

Holiday Sales Company and Global Distributors, Inc., enter into a contract for the delivery of imported specialty goods. Until the goods are delivered and paid for, these parties have

?

Fresh Fast Service, Inc., offers to deliver produce to Growers' Market's customers for a certain price. Fresh's intent to extend a serious offer to Growers' Market is determined by reference to Fresh's

words and conducts

Mary admires Julia's collection of scarves. Julia says "I might sell you a few someday, if I get tired of them." Julia's statement is
not an effective offer because the Julia does not show a serious intent to be bound
Kayla puts an item in an auction with reserve. Kayla is the
offeree
Jake bids on an item in an auction with reserve. Jake is the
offeror
On May 1 Jill offers to sell Andrea a herd of sheep. On May 3 Jill mails Andrea a letter revoking the offer. Andrea receives the letter on May 5. Jill's revocation of the offer to sell the sheep became effective on

May 3

Younger asks Zippy, "Do you want to buy one of my fishing rods?" This is
not a valid offer because the terms are not definite
Jack offers to sell Ben a new car for $10,000. Ben accepts the offer and sells his old car so that he will have money for the new one. Jack's offer is probably
irrevocable because Ben sold his old car because of justifiable reliance on Jack's offer to sell him a new car

fix-It-Quik, Inc., offers Denise a job as a plumber. No time for acceptance is specified in the offer. The offer will terminate

after a reasonable amount of time.

Liz offers to sell Jock her iPad for $500 without any accessories. Under the mirror image rule, Jock's response will be considered an acceptance ifthe terms of the acceptance.

exactly mirror those of the offer

Interstate Coffee Brokers, Inc. (ICBI), offers to sell Java Roasters, Inc., fifty bags of coffee beans. Java rejects the offer. The offer is

terminated

Kingston promises to pay Melina $500 to install a sump pump in his warehouse. Melina completes the installation. The act of installing the pump
is the consideration that creates Kingston's obligation to pay Melina.
Rollo promises to perform, for a price, shoe repair services in affiliation with Togs 'n Things, a clothing store. To support a contract, the consideration exchanged by the parties must be
legally sufficient

Sparky offers Teodora $1,000 for her collection of rare coins. She accepts. If a dispute arises, a court would likely

not question the adequacy of the consideration
Jake meets Bill in the parking lot outside of a bar. He grabs Bill roughly by the shoulder and demands that Bill sell Jake Bill's custom milled skis. Jake says, "You wouldn't want to get roughed up, would you?" Bill agrees to sell the skis to Jake. The contract is
unenforceable because Bill agreed to it under duress
Jack buys Jill's house for $1.00. If the contract is later disputed in court, the court is likely to declare Jack's consideration
unconscionable
Todos Ltd. agrees to supply Petro Refining, Inc., with oil from Venezuela. When the government unexpectedly nationalizes the oil industry, Todos can obtain the resource only at a much higher price. Petro agrees to pay but later files a suit to recover the difference. The court will most likely rule that a change in government is a risk ordinarily assumed in business.
an unforeseen difficulty supported the contract modification
Martha is the sheriff of Junction, Texas. Alex robs a gas station on the edge of town and then evades capture. A $500 reward is offered for his capture. The following week, Martha captures Alex. Martha
cannot collect the $500 reward because she had a preexisting duty to catch Alex

Mariah promises to pay her assistant Nadine $10,000 in consideration of the services she provided over the years. Mariah never pays Nadine. Mariah is liable for payment of the $10,000

not liable, because the consideration is in the past

Dave's uncle tells Dave that if "he feels that Dave deserves it," he will give Dave $1,000 when Dave graduates from college. Dave's uncle's promise is

illusory

Boyd is a minor. As a minor, Boyd has the capacity to enter into:

a valid contract

James is sixteen years old. Legally, James is considered

?

In most states, when a person turns eighteen, he or she has reached

Age of competence.

Richard is an adult. He enters into a contract to sell sixteen-year-old Jane his car for $3,000. The next day Richard receives an offer of $4,000 for his car from twenty-year-old Bill. Richard

cannot disaffirm his contract with Jane because he is an adult

Olivia, a minor, signs a contract to buy a bike from Phil, the owner of SuperCycles Bike Store. Olivia's right to disaffirm the contract

does not change the fact that Phil is bound by the contract

Katie buys a car when she is seventeen. When she is twenty-five, Katie tries to disaffirm the contract and recover all her car payments. A court will likely find that the contract was
ratified and Katie cannot recover her payments
Gaye, a minor, signs a contract to buy a motorcycle from Hi-Valu Cycles by misrepresenting her age as twenty-one. Gaye fails to make the payments. Hi-Valu sues. In most states, Gaye can
return the motorcycle and avoid further liability
Mica, a minor, signs a contract to pay Natural Health Club a monthly fee for twenty-four months to use its facilities. Six months later, after reaching the age of majority, Mica continues to use the club. This act is
a ratification
Intoxicated but fully aware of the consequences, Uri agrees to a two-year cell-phone service contract with Wander Talk, Inc., at more than the average market price. This contract is:
not enforceable
The state of Illinois enacts a usury statute. The purpose is to
establish a maximum rate of interest that may be charged for loans

Nyoko signs a covenant not to compete with her employer, Midstate Distribution, Inc. The covenant will be enforced if it

is reasonable with respect to geographic area and time

Presley agrees to sell his Omni Sports Equipment store to Nola. As part of the sale, Presley promises never to open a similar, competing store anywhere. This promise is most likely

invalid because of the unreasonable terms of area and time

SuperBumperCars, Inc. requires all customers to sign a release that contains a clause that releases SuperBumperCars from all liability in the event of an injury occurring during a bumper car ride, no matter who is at fault. This is an example of

an exculpatory clause

A contract between Lou and Mike requires a transfer of stolen goods for counterfeit currency. This contract is

void

Through fraudulent means, Finlay induces Ethel to sign a contract to invest with him the profits from her business. When Ethel learns the truth, she may

enforce the contract or recover what she invested with Finlay

May is a stockbroker. Due to May's statements, Nora believes that the price of OK Goods, Inc. (OKGI), a widely traded stock, is going to increase substantially. Nora buys 500 shares of OKGI at $10 per share, but the price soon drops to $2. Nora can successfully recover

Nothing

Shelby wants to sell his Bobcat Skidsteer for $21,000. He emails Dave and offers to sell Dave the Bobcat. Due to a typo, Shelby tells Dave that he wants $20,100 for the Bobcat. Dave accepts the offer and pays Shelby $20,100. Shelby is

bound by the contract

Jane and Phil enter into a contract, but make a bilateral mistake. In order for the contract to be rescinded by either party, the bilateral mistake must be about a(n)

material fact

Olin, an art instructor, convinces Pia, who has no artistic ability, that Pia has considerable talent and induces Pia to pay Olin $10,000 for art lessons. When Pia realizes the truth, she files a suit against Olin. Pia is most likely to recover on the basis of

fraud

Gina induces Hugh to enter into a contract for the purchase of a condominium about which Gina knowingly misrepresents its size. When Hugh discovers the truth, he can

Rescind on the basis of fraud

Kayla wants to rent an apartment from QualityLiving, Inc. The QualityLiving agent knows that many of the QualityLiving apartments have leaky roofs. When Kayla asks the QualityLiving agent if roof of the apartment ever leaks, the agent assures her that there have never been any leaks in any of the apartments. When Kayla moves in, she discovers a large leak in the kitchen and water stains on all the ceilings. Kayla

can rescind the contract on the ground of misrepresentation.

Barb, a real estate agent, is showing John a house. She tells him that this is a house where "his family can live happily ever after." John buys the house, but his wife does not like it. John

was not defrauded

Scienter exists in which of the following cases?

Martin knows that the transmission on his truck is defective, but does not tell this fact to potential buyers.
Lara induces Moe to enter into a contract for the sale of an apartment. Lara tells Moe that her commission is 6 percent, but their signed, written contract states "12 percent." The Statute of Frauds governs

Contracts must be in writing to be enforces.

Century Properties. Inc., and Broadview Capital Corporation enter into a contract for a sale of land. To be enforceable, the contract must be in writing if the land is valued at

$50, $500, or $5,000

Dixie May enters into a contract to buy one hundred pounds of pecans from Margaret. The contract must be in writing if the pecans cost

$500

Lem buys a used MP3 player for $50 and a new air hockey table for $1,500, and signs a one-year employment contract for a $4,000 monthly salary to start at the beginning of the next month. The Statute of Frauds covers

employment contract and air hockey table

Ground Minerals, Inc. and SuperSupplements, Inc. enter into an oral contract for the purchase of mineral rights to a piece of property owned by Ground Minerals. Ground Minerals then refuses to allow SuperSupplements to extract minerals from the property. SuperSupplements files suit against Ground Minerals for breach of contract. Ground Minerals can use the __________ as a defense.

Statute of Frauds

Cody and Dora enter into an oral contract under which Cody agrees to work on Dora's farm for not less than one week. This contract is enforceable by

either party

Ilsa and Jiffy Loan Company enter into an oral contract under which Ilsa agrees to pay Kyle's debt if he does not. Ilsa does not get any personal benefit for the agreement. This contract is enforceable by

none of the parties

Retail Sales Company and Standard Purchasing Corporation enter into a contract for a sale of goods. To be enforceable, the contract should be in writing if the goods are valued at more than

$500

Valley Tack Shop signs a contract with Gary's Boots and Saddles for delivery of five saddles that cost $200 each. To be enforceable under the Statute of Frauds, the written contract must designate

quality of the saddles

Macro Marketing, Inc., and Nature Foods Corporation (NFC) discuss the terms of a contract. Macro faxes NFC a memo on Macro's letterhead that summarizes the items on which they agree. NFC begins to perform, but Macro refuses to pay. Between Macro and NFC, the memo is

written contract