Written Contracts

Question 1

True/False: Hannah orally agrees to sell her house to Brett for $175,000. If she delivers the deed to Brett with the expectation of payment in two weeks and he fails to pay, most courts will not enforce the contract since it was not in writing.

Answer 1

False

Question 2

True/False: Any contract involving a sale of goods of $100 or more must be in writing.

Answer 2

False

Question 3

True/False: Bry, Inc. and Gangl Co. entered into an oral agreement for the sale of 3,000 sweaters. Both parties performed as required under the contract. Bry delivered the sweaters and Gangl accepted and paid for them. Since the contract is fully executed, it makes no difference that it was oral.

Answer 3

True

Question 4

True/False: The original statute of frauds is the English law that began the practice of requiring written evidence of certain kinds of contracts, but now the British government has repealed the writing requirement for most contracts.

Answer 4

True

Question 5

True/False: Sweet Plantation, Inc. made a written contract with Candy, Inc. whereby Sweet Plantation agreed to supply all of Candy’s sugar requirements for the next year at $.25 per pound. A dispute arose as to how much sugar Sweet is to supply. The parol evidence rule will bar Sweet’s introduction of evidence concerning the intent of the requirements of Candy.

Answer 5

False

Question 6

True/False: Raymond agrees to transfer an easement right to Sandra for $1,000. This contract is within the statute of frauds and therefore needs to be in writing to be enforceable.

Answer 6

True

Question 7

True/False: Ramona orally agreed to work for Brahma, Inc. for the rest of her life for $50,000 per year. This agreement would not be enforceable since it violates the one-year rule of the statute of frauds

Answer 7

False

Question 8

True/False: Parol evidence refers to anything (other than the written contract itself) that was said, done, or written before or as the parties signed the contract.

Answer 8

True

Question 9

True/False: Patrick owned an acre of land which was being divided into building lots. Nancy was interested in purchasing the corner lot. In a signed writing, Patrick stated “I will sell Nancy Grimes a lot on Route 70 for $5,500 cash, payable on April 30, 2009.” This writing is sufficient under the statute of frauds to make the contract enforceable.

Answer 9

False

Question 10

True/False: The Uniform Commercial Code provides that, under certain circumstances, a merchant may be liable on a written contract, even though that merchant has NOT signed it.

Answer 10

True

Question 11

True/False: Amanda, a recent university graduate, needed a car to get to her new job. To help Amanda secure a loan for the car, Ted, a friend, agreed to pay the loan should Amanda default. Ted’s promise to pay the loan is a collateral promise. His promise must be in writing to be enforceable.

Answer 11

True

Question 12

True/False: Whittle sent an order over the Internet for a $1,200 garage door. His name keyed onto the order will only be effective as a signature sufficient to create a “writing” “signed by the party against whom enforcement is sought” if he follows up with a signature on paper.

Answer 12

False

Question 13

True/False: Either party may demand rescission of a fully executed oral contract that was required to have been in writing under the statute of frauds.

Answer 13

False

Question 14

True/False: Under the statute of frauds, the writing must: be signed by the defendant; and must state with reasonable certainty the name of each party, the subject matter of the agreement, and all of the essential terms and promises.

Answer 14

True

Question 15

True/False: Rest Well Hotel orally ordered 1,000 blankets monogrammed with its initials, RWH, from TriColor Textiles. TriColor had just finished monogramming the blankets when Rest Well called and canceled the order. TriColor will be able to enforce the agreement even though there was no writing.

Answer 15

True

Question 16

For statute of frauds purposes, an interest in land includes:

Answer 16

ALL OF THE ABOVE

Question 17

Tuan is president and sole shareholder of Entertainment, Inc. Entertainment, Inc. wishes to borrow money, but to do so, the bank requires Tuan to orally agree to pay the debt of the corporation if Entertainment, Inc. cannot. Tuan’s guarantee to repay is:

Answer 17

ENFORCEABLE B/C OF THE LEADING OBJECT RULE

Question 18

Robin and Bellman, both merchants, orally agree to a contract for the sale of $5000 of accessories. Bellman, the buyer, sends to Robin, the seller, a written confirmation of the sale, which is sufficient against Bellman under the statute of frauds and which Bellman signs. Robin fails to perform the contract and does not ship out the goods. Bellman sues. This contract is:

Answer 18

ENFORCEABLE EVEN W/O ROBIN’S SIG. B/C BOTH PARTIES ARE MERCHANTS

Question 19

In order to satisfy the statute of frauds, a writing must:

Answer 19

BE SIGNED BY THE DEFENDANT AND CONTAIN THE NAME OF EACH PARTY

Question 20

Willis and Leslie orally agree to the sale of a parcel of land for $50,000: one-half payable now as a down payment; one-half payable in 30 days at the time of closing when the title will be transferred. The buyer, Willis, is to have possession immediately. Willis pays Leslie $25,000, takes possession of the land, and starts building a house. At the time of closing, Willis has made a substantial beginning on the house. However, Leslie refuses to transfer the title, claiming the oral contract is not enforceable. This contract is:

Answer 20

ENFORCEABLE, B/C WILLIS HAS PARTIALLY PERFORMED THE ORAL CONTRACT AND MADE IMPROVEMENTS ON THE LAND

Question 21

Abby dies, and her good friend, Claire is appointed to administer Abby’s estate. Abby’s house was in poor condition, so Claire orally hired a contractor to make repairs. Claire also orally promised that if the estate could not pay the repair bill, he would pay it even though he does not live in the house and has no entitlement under Abby’s estate. The estate does not pay the repair bill. Who can the contractor collect from, if anyone

Answer 21

THE CONTRACTOR CAN COLLECT FROM THE ESTATE ONLY

Question 22

Derek and Abyan were discussing business over lunch when they agreed on the sale of a five-acre parcel of land. Since neither of them had any paper with them, Derek wrote the following on a napkin: “Abyan agrees to purchase from Derek a 5-acre parcel located at the local address of 123 105th Street, St. Joseph, Minnesota, U.S.A. for the price of $4,500 per acre. Transfer of title, payment, and possession to take place on May 1, 2008.” Abyan signed the napkin. On May 1, 2008, Derek was ready to close the deal and transfer title but Abyan refused to pay the purchase price. If Derek sues Abyan for the price of the land, the most likely result will be:

Answer 22

DEREK WILL WIN B/C THE WRITING IS SUFFICIENT UNDER THE STATUTE OF FRAUDS

Question 23

Which of the following types of contracts cannot be either contradicted or supplemented by evidence of prior agreements or expressions?

Answer 23

TOTALLY INTEGRATED CONTRACTS

Question 24

Claude agrees to lease his house to Irvin for nine months, the lease to begin six months from the signing of the contract. Under the statute of frauds:

Answer 24

THE LEASE IS REQUIRED TO BE IN WRITING B/C OF THE ONE-YEAR RULE

Question 25

The main difference between the UCC requirement for a writing for a contract for the sale of goods and the common law is that the:

Answer 25

UCC DOES NOT REQUIRE ALL THE TERMS OF THE AGREEMENT TO BE IN WRITING

Question 26

Which of the following promises ordinarily must be in writing to be enforceable?

Answer 26

ALL OF THE ABOVE

Question 27

Renita, a merchant, has received a signed, written confirmation from Merchants, Inc. referring to goods she had not ordered. Renita should:

Answer 27

OBJECT TO THE CONFIRMATION IN WRITING W/IN 10 DAYS

Question 28

Under the UCC, which of the following contracts may be enforceable, even without a written memorandum?

Answer 28

ALL OF THE ABOVE

Question 29

Brahma entered into an oral agreement to sell 50 jet skis to Summer Sports. Brahma delivered 20 of the skis on May 1. On June 1, Summer Sports notified Brahma that it will not honor the agreement. Which statement is correct?

Answer 29

THE CONTRACT IS ENFORCEABLE FOR 20 JET SKIS

Question 30

Alfred orally promised to pay Robert a salary of $30,000 per year for five years and his moving expenses up to $10,000 if Robert would quit his job and come to work for him at his manufacturing plant. Robert agreed to do so, but requested a written contract. Alfred assured him that the company attorney would prepare such a contract as soon as possible, but Alfred needed Robert to start at once. Accordingly, Robert sold his house, moved his family, and commenced to work for Alfred. He was fired without cause two months later. No written contract was ever executed. Can Robert enforce Alfred’s oral promise?

Answer 30

MAYBE. ROBERT

Question 31

Scott is trying to introduce oral evidence in court to alter the terms of a written contract he had with Bonnie. Bonnie has raised the parol evidence rule as an objection to Scott’s testimony. In which of the following circumstances will Scott not be able to introduce the oral evidence?

Answer 31

THE CONTRACT HAS INTEGRATION CLAUSE

Question 32

Under a contract for the sale of land, the statute of frauds:

Answer 32

REQUIRES THE DEFENDANT TO SIGN THE AGREEMENT

Question 33

Ethel’s Exercise World plans to order three weight machines from Pete’s Push, Pedal and Pull, Inc. for a total of $15,000. Pete’s demands that Ethel’s friend, Moneybags, a wealthy independent businesswoman (not connected with Ethel’s business in any way) promise to pay Pete’s for the three machines if Ethel’s Exercise World does not. Which of the promises in this problem must be in writing to be enforceable?

Answer 33

BOTH MONEYBAG’S PROMISE AND ETHEL’S PROMIS

Question 34

Which of the following would suffice for a signature on a writing under the statute of frauds?

Answer 34

ANY OF THE ABOVE WOULD SUFFICE. JUDGES

Question 35

Amy Hudson has been trying to purchase Glen Cappel’s antique desk for some time, but Glen has been reluctant to sell. One evening Glen said to Amy, “Okay, I’ll sell the desk for $550.” Amy replied, “Thank you, Glen. I accept.” The agreement was not reduced to writing, but Glen and Amy did shake hands. Two days later, Amy sent Glen a letter outlining the terms of the agreement, and stating that she would deliver $550 cash according to the agreement within ten days. The letter was signed, “Best regards, Amy.” Later, Amy had second thoughts, and refused to go through with the purchase. Nothing had been exchanged at this point. Glen:

Answer 35

CAN ENFORCE THE CONTRACT AGAINST AMY B/C THE STATUTE OF FRAUDS IS SATISFIED UNDER THIS SITUATION

Question 36

Vicki entered into a written contract to buy a car from Valley Motors. During the negotiations, the sales representative said that the car had a two-year full warranty. The written contract included a provision that stated, “This writing is the full and final expression of the parties’ agreement; anything said before signing or while signing is irrelevant.” The written contract did not include a warranty. Two months after Vicki took delivery of the car, she discovered that the transmission needed to be replaced. Vicki claimed that it was covered by the full warranty. Will Vicki be able to present evidence as to the sales representative’s statements concerning the warranty?

Answer 36

NO

Question 37

Vicki entered into a written contract to buy a car from Valley Motors. The written contract included a provision that stated, “This writing is the full and final expression of the parties’ agreement; anything said before signing or while signing is irrelevant.” This is:

Answer 37

AN INTEGRATION CLAUSE

Question 38

When a contract falls within the statute of frauds but is not reduced to a writing, the contract is:

Answer 38

UNENFORCEABLE

Question 39

Sonny, a college student, places a telephone order for a new computer from Computers, Inc. The price of the computer is $1500. The clerk who takes the order sends Sonny a copy of the invoice. The next week, Sonny calls back and tries to cancel his order.

Answer 39

SONNY CAN CANCEL THE ORDER; THE INVOICE IS UNENFORCEABLE AGAINST HIM, AS HE DID NOT SIGN THE INVOICE

Question 40

Martin, Human Resources Director for Spring Co., sent Lynn the following signed letter: “This letter confirms our offer to you. We will pay for your moving expenses, up to $1,500. Your starting date will be February 1, and you will become eligible for health care benefits as of May 1. You will receive a starting salary of $36,500 annually, with reviews and eligibility for increases at six months, 12 months, and annually thereafter. Vacation will be for two weeks a year after one year.” Spring fired Lynn eight months after she started to work, and Lynn sued arguing the letter constituted a memorandum of an oral contract for employment for five years. Is the letter sufficient to satisfy the statute of frauds?

Answer 40

NO, TO SATISFY THE S.O.F.