Multiple-Choice Questions
1. In which case is a court most likely to enforce an exculpatory clause?
(a) Dentistry
(b) Hang gliding
(c) Parking lot
(d) Public transportation
(e) Accounting
2. Sarah, age 17, uses $850 of her hard-earned, summer-job money to pay cash for a diamond pendant for the senior prom. She has a wonderful time at the dance but decides the pendant was an extravagance, returns it, and demands a refund. The store has a "no refund" policy that is clearly stated, on a sign on the wall. There was no defect in the pendant. The store refuses the refund. When Sarah sues, she will
(a) Win $850
(b) Win $425
(c) Win, but only if she did not notice the "no refund" policy
(d) Win, but only if she did not think the "no refund" policy applied to her
(e) Lose
3. Tobias is selling a surrealist painting. He tells Maud that the picture is by the famous French artist Magritte, although in fact Tobias has no idea whether that is true or not. Tobias's statement is
(a) Bilateral mistake
(b) Unilateral mistake
(c) Fraud
(d) Innocent Misrepresentation
(e) Legal, as long as he acted in good faith
4. Louise e-mails Sonya, "I will sell you my house at 129 Brittle Blvd. for $88,000, payable in one month. Best, Louise." Sonya e-mails back, "Louise, I accept the offer to buy your house at that price. Sonya." Neither party prints a copy of the two e-mails.
(a) The parties have a binding contract for the sale of Louise's house.
(b) Louise is bound by the agreement but Sonya is not.
(c) Sonya is bound by the agreement but Louise is not.
(d) Neither party is bound because the agreement was never put in writing.
(e) Neither party is bound because the agreement was never signed.
(e) An adhesion contract
5. In February, Chuck orally agrees to sell his hunting cabin, with 15 acres, to Kyle for $35,000, with the deal to be completed in July, when Kyle will have the money. In March, while Chuck is vacationing on his land, he permits Kyle to enter the land and dig the foundation for a new cottage. In July, Kyle arrives with the money but Chuck refuses to sell. Kyle sues.
(a) Chuck wins because the contract was never put in writing.
(b) Chuck wins because the contract terms were unclear.
(c) Kyle wins because a contract for vacation property does not need to be written.
(d) Kyle wins because Chuck allowed him to dig the foundation.
(e) Kyle wins because Chuck has committed fraud.
6. Ted's wallet is as empty as his bank account, and he needs $3500 immediately. Fortunately, he has three gold coins that he inherited from his grandfather. Each is worth $2500, but it is Sunday, and the local rare coins store is closed. When approached, Ted's neighbor Andrea agrees to buy the first coin for $2300. Another neighbor, Cami, agrees to buy the second for $1100. A final neighbor, Lorne, offers "all the money I have on me" - $100 - for the last coin. Desperate, Ted agrees to the proposal. Which of the deals is supported by consideration?
(a) Ted's agreement with Andrea, only
(b) Ted's agreements with Andrea and Cami, only
(c) All three of the agreements
(d) None of the agreements