Reference no: EM131313756

1.Maker manufactures printing presses. News, a publisher of a local newspaper,was interested in purchasing a few presses. Rep, a representative of Maker, metwith Bill, the president of News, to describe the advantages of Maker'spresses. Rep also drew rough plans of the alterations that would be required inthe News pressroom to accommodate the new presses, including additional floorspace and new electrical installations, and left the plans with Bill. <?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

OnDecember 1, Bill received a letter signed by Seller, a member of Maker's salesstaff, offering to sell the required number of presses at a cost of $2.4million. The offer contained provisions relating to the delivery schedule,warranties, and payment terms, and stated that the terms will be good for 60days. Under the Uniform Commercial Code was a firm offer created?

A.Yes, since both parties were merchants.
B.Yes, since the letter was a signed writing giving assurances that the offerwill be held open.
C.No, since the offer stated the period of time for which it would beirrevocable.
D.No, since the offeror did not sign the form supplied by the offeror.

2.Pottery Plant Co. has entered into an agreement to buy its actual requirementsof potting soil for six months from Green Supplies, a garden supply company.Green Supplies has agreed to sell all the potting soil they will require forsix months. The agreement between the two companies is:

A.Unenforceable because it is too indefinite as to quantity.
B.Unenforceable because it lacks mutuality of obligation.
C.Unenforceable because it is illusory.
D. Avalid and enforceable contract.

3.Motors entered into an oral option with Hap, Inc., for $50. The option was topurchase at cost any late model used yacht received by Motors as a trade in ona new yacht for the next 100 days. Hap paid the $50 in cash and promptly sentMotors a signed memorandum which correctly described the agreement and itsterms. Motors did not respond until after 30 days had elapsed and it haddiscovered they had made a very bad bargain. Motors notified Hap that theywould no longer perform under the terms of the option, which they alleged wasinvalid, and enclosed a check for $50 to Hap. Which of the following iscorrect?

A.The oral option is invalid for lack of consideration.
B.The Statute of Frauds can be validly asserted by Motors to avoid liability.
C.Motors has entered into a valid contract with Hap.
D.Options for a duration of more than three months are unenforceable.

4.Ellie, a 17 year old minor, contracted with Compco to purchase a used computerfor $700. The computer was purchased for Ellie's personal use. The agreementprovided that Ellie would pay $300 down on delivery and $100 thirty days laterover the next four months. Ellie took delivery and paid the $300 down payment.Twenty days later, the computer was seriously damaged as a result of Ellie'snegligence. Five days after the damage occurred and one day after Ellie reachedthe age of majority, Ellie attempted to disaffirm the contract with Compco.Ellie will:

A. Be able to disaffirmdespite the fact that Ellie was not a minor at the time of disaffirmation.
B. Be able to disaffirm only if Ellie does so in writing.
C.Not be able to disaffirm because Ellie had failed to pay the balance of thepurchase price.
D.Not be able to disaffirm because the computer was damaged as a result of Ellie'snegligence.

5.Paul Principal decided to buy a sailboat. He felt that it was necessary toinvestigate comparable boats with different nautical options. Paul was leavingon a trip and he authorized Alice Agent to do the necessary research and purchasethe appropriate boat. Alice conducted research and finally decided to purchasea $5,000 Choy Lee 26 foot sloop from Splendid Sailboats Unlimited. She signedthe sales contract with Splendid as "Paul Principal by his agent, AliceAgent." When Paul returned from his trip he refused to accept the sailboator pay the $5,000 to Splendid. Splendid sued Paul and Alice. The likely outcomeof the suit is that:

A.Splendid will prevail against Alice only if Paul refuses to accept thesailboat.
B.Splendid will prevail against Paul because the purchase was in writing.
C.Splendid will not prevail against Alice even if she guaranteed the payment ofthe sailboat purchase contract.
D.Splendid will not prevail against Alice if she misrepresented the scope of herauthority to purchase the sailboat.

6.Sarah Sailor owned two sailboats, a 32 footer and a 37 footer. Bill Buyer hasseen the 37 footer sailboat but not the smaller sailboat. Sarah offered inwriting to sell "my sailboat" to Bill for $15,000 cash. Bill acceptedand paid Sarah the $15,000 cash.
Thenext day, Sarah delivered the sailboat to Bill who rejected the tender since itwas not the sailboat he thought he was buying. Sarah refused to return Bill's$15,000 payment and insisted that Bill take the smaller sailboat. The bestfacts supporting Bill's argument to seek relief would be:

A.Express fraud by Sarah.
B. Alatent ambiguity was known by Sarah but not by Bill.
C.There was a mutual mistake.
D.Bill's subjective intent should control requiring reformation of the contractsubject.

7.Elrod is attempting to introduce oral evidence in court to explain or modifythe written contract he made with Weaver. Weaver has pleaded the parol evidencerule. In which of the following circumstances will Elrod not be able tointroduce the oral evidence?

A.The modification asserted was made several days after the written contract hadbeen executed.
B.The contract indicates that it was intended as the "entire contract"between the parties, and the point is covered in detail.
C.There was a mutual mistake of fact by the parties regarding the subject matterof the contract.
D.The contract contains an ambiguity on the point at issue.

8.Stand Glue Corp. offered to sell Macal, Inc., all of the glue it would need inthe manufacturing of its furniture for one year at the rate of $25 per barrel,F.O.B. seller's city. Macal accepted Stand's offer. Four months later, due to inflation,Stand wrote to Macal advising Macal that Stand could no longer supply the glueat $25 per barrel, but offered to fulfill the contract at $28 per barrelinstead. Macal, in need of the glue, sent Stand a letter agreeing to pay theprice increase. Macal is:

A.Legally obligated to pay only $25 per barrel under the contract with Stand.
B.Legally obligated to pay $28 per barrel under the contract with Stand.
C.Not legally obligated to purchase any glue. Stand has breached the contract.
D.Legally obligated to pay $28 per barrel due to the fact inflation represents anunforeseen hardship.

9.Brown ordered 100 cases of Delicious Brand apples at list price from SmithWholesaler stating "prompt shipment." Upon receipt of Brown's order,Smith immediately sent Brown an acceptance which was received by Brown. Theacceptance indicated that shipment would be made within ten days. On the tenthday Smith discovered that all of its supply of Delicious Brand apples had beensold. Instead it shipped 100 cases of Lovely Brand apples, stating clearly onthe invoice that the shipment was sent only as an accommodation. Which of thefollowing is correct?

A.Smith's shipment of Lovely Brand apples is a counteroffer, thus no contractexists between Brown and Smith.
B.Smith's note of accommodation cancels the contract between Smith and Brown.
C.Brown's order is a unilateral offer, and can only be accepted by Smith'simmediate shipment of the goods ordered.
D.Smith's shipment of Lovely Brand apples constitutes a breach of contract.

10.Owner, a homeowner, approached Jackson, a licensed painter, to discuss paintinghis home before he places it up for sale. After several meetings, Owner andJackson signed a contract which stated Jackson will paint the interior andexterior of Owner's home on or before June 1st. The colors were to be specifiedby Owner, and Painter was to supply the paint. Owner agrees to pay $22,500 uponcompletion. The time for performance of these obligations shall be of the essence.

The contract was signed on May 1st. Jackson arrived on the job site on May 15th tobegin work. Several weeks later, Jackson went on vacation and did not returnuntil June 2nd. Owner was upset by his continuously not showing up that on June3rd he hired another painter to finish the job.

Ownerbrings an action against Jackson. Who will prevail?

A.Owner will recover against Jackson the price he paid to the new Painter hiredto do the job since, Jackson did not complete performance.
B.Owner will prevail since there was a breach of an express condition createdbetween Owner and Jackson.
C.Jackson, because Owner refused to allow him to finish the job.
D.Jackson, since Owner refused to let Jackson finish the job which constitutes abreach of contract.