ASSIGNMENT FIVE

CHAPTER FIFTEEN/CONTRACTS: MISTAKES, FRAUD, AND VOLUNTARY CONSENT

To this point in the text, you have studied how a contract comes into existence, when a contract will not be enforced because it is illegal or against public policy, and how the law protects certain categories of people by allowing them to avoid their contracts.This chapter concerns another category of relief from the enforcement of contracts: a contract may be unenforceable if the parties have not genuinely assented to the terms.

In determining the genuineness of assent of the contracting parties, courts looks at a party's objective intent. A court may find that genuineness of assent is lacking because of mistakes, misrepresentation, undue influence, or duress (in other words, because there is no true "meeting of the minds").If the law were to enforce contracts not genuinely assented to by the contracting parties, injustice would result. The injured party may opt to enforce the deal, however, or to rescind it.

CHAPTER SIXTEEN/CONTRACTS: THE WRITING REQUIREMENT AND ELECTRONIC RECORDS

This chapter covers two distinct concepts: how the Statute of Frauds affects the enforceability of a contract, and how the parol evidence rule excludes outside evidence offered to modify a contract.

A contract that is otherwise valid may be unenforceable if it is not in the proper formcertain types of contracts are required to be in writing. If a contract is required by law to be in writing and it is not, it may not be enforceable.

When a contract has been put in writing, and a dispute arises that ends up in court, the parties may not introduce evidence of prior written or oral negotiations or promises or contemporaneous oral agreements that contradict the contract terms. This is the parol evidence rule. For it to apply, the parties must have intended their writing to be their final agreement. Of course, as with the other concepts covered in this chapter, there are exceptions.

CHAPTER EIGHTEEN/PERFORMANCE AND DISCHARGE IN TRADITIONAL AND E-CONTRACTS

This chapter answers these questionswhen have the parties to a contract done all that is required under the contract? When is a party excused from doing what he or she promised in the contract to do?

When contracting parties do what they promised to do, their duties are discharged, and their contract is terminated. Performance is the most common form of discharge, but duties can be discharged in other ways. Generally, the occurrence or failure of a condition on which a contract is based will discharge the parties' duty to perform. A breach of contract will discharge the duty of the nonbreaching party to perform. The parties may agreethrough rescission, novation, or accord and satisfaction not to perform as they contracted. Also, by operation of law the parties' duties may be discharged (through material alteration of the contract, a statute of limitations, bankruptcy, impossibility or comm

ANSWERS ARE TO BE POSTED TO PROFESSOR KEINER IN MAIL

Read Chapters 15, 16 and 18 and answer the following questions Each fully correct answer to the first 1-4 and 17-20 questions are worth 5 points each. Correct answers to the multiple-choice questions, are 2 points each.

1.a. Explain a mistake in judgment as to market conditions (value).

b. Explain a mistake of fact.

2.Explain when a unilaterally mistaken party has a right to relief.

3.The elements of fraudulent misrepresentation include misrepresentation of a material fact.Discuss this element.

4.List the five types of contracts that must be in writing in order to be enforceable under the Statute of Frauds?

5.Jean purchases a fishing rod for $100 and a new suitcase for $600, and signs a one-year employment contract for a $3,200 monthly salary to start at the beginning of the next month. The Statute of Frauds covers

a. the employment contract, and the fishing rod and the suitcase.

b.the employment contract and the suitcase purchase only.

c.the employment contract only.

d.the fishing rod and suitcase purchases only.

6.Lin, Inc. orally contracts for a lease of its facilities to Vella to use for his Kings & Bay Fishing Camp. Vella pays part of the rent, takes possession, and improves the property for use by her enterprise. The contract is most likely enforceable by

a.Lin, Inc. and Vella.

b.Lin, Inc. but not Vella.

c.any interested third party, such as a Kings & Bay client.

d.no one.

7.Juan orally promises Lisa that he will buy her modified 2013 Toyota Prius. For this promise to be enforceable under the doctrine of promissory estoppel,

a.the Prius must be considered a customized good.

b.Lisa must act in reliance on Juan's promise to her detriment.

c.Juan's promise must have been overheard by a third party.

d.there must be written evidence of the deal.

8.Lotto Farms, LLC, and IOI Transport Company sign a written contract that does not involve a sale of goods. To be enforceable, the writing must include

a.a correct title, such as "Shipment Contract."

b.all essential and nonessential terms.

c.a statement of the consideration.

d.a description of the parties' businesses.

9. Construction R'Us Hardware Stores and Mega Tools, Inc., sign a written contract for a sale of goods. To be enforceable, this written contract must include

a.a correct title, such as "Purchase Order" or "Sales Invoice."

b.a date, such as "October 2014" or "10/2014."

c.a quantity term, such as "50 hammers" or "100 boxes of assorted nails."

d.the parties' contact information.

10. Al tells a representative of Melrose Musical Instruments, Inc., that he will pay for Candy's trumpet if she does not. Al does not secure any personal benefit for this promise. Al's oral promise is enforceable as a contract by

a.Melrose Musical Instruments, Inc.

b.Candy.

c.Al.

d.none of the choices.

11.Ned enters into a contract with Transocean, Inc., to insure and ship a piano from Austria to the United States for a certain price. But Transocean makes a mistake in adding the costs, which results in a contract price that is $2,000 less than the true cost. Most likely, a court would

a. allow the parties to rescind the contract.

b.award damages to Ned for the mistake.

c.award damages to Transocean for the mistake.

d.enforce the contract as is.

12.George owns two motorcycles worth $2,000 and $900, respectively. Hank agrees to buy "George's motorcycle" for $750. Garth believes, in good faith, that he is selling the $900 motorcycle. Hank believes, in good faith, that he is buying the $5,000 motorcycle. In this situation

a.George is entitled to $750 for the $900 motorcycle.

b.Hank is entitled to the $2,000 motorcycle for $750.

c.Hank must buy both motorcycles for $1,500.

d.there is no contract.

13.Doria, at an auction for the first time, bids on a one-hundred-year-old Tiffany lamp, believing that it is worth more than the price asked. When the item proves to be less valuable, Doria is

a.liable on the bid.

b.not liable on the bid because Doria overestimated the value of the auctioned item.

c.not liable on the bid because the auctioneer overstated the value of the auctioned item.

d.not liable on the bid because this was Doria's first auction.

14.Bella agrees to sell to Charlene, for $5,500, a remote parcel of land. They believe the land to be worthless, but beneath it is a gold mine. Bella can

a.not rescind the contract.

b.rescind the contract on the basis of fraud.

c.rescind the contract on the basis of mistake.

d.rescind the contract on the basis of undue influence.

15.Kelsey, a real estate agent, assures Larry that a certain parcel of commercial property fronts on the most highly trafficked street in Lincoln City. Larry buys the property and then discovers that the street has no more traffic than any other in its vicinity. Larry is most likely a victim of

a.opinion.

b.fraud.

c.mistake.

d.nothing.

16. Melanie is induced by her guardian Neville to sign a contract to invest her student loan funds in Oberlin Bank through Neville's investment firm. Unknown to Melanie, Neville receives ongoing commissions from the investment. Most likely, Melanie may

a.not rescind the contract.

b.rescind the contract on the basis of undue influence.

c.rescind the contract on the basis of mistake.

d.rescind the contract on the basis of unconscionability.

CHAPTER EIGHTEEN

17. What are the differences between express conditions and implied in fact conditions?

18. a. Explain the concept of anticipatory repudiation.

b. State and explain all options the non-breaching party has when he/she learns of the repudiation.

19. State and explain three ways a contract can be discharged by agreement.

20. State and explain three ways a contract can be discharged by operation of law?

21.Ben enters into a contract to operate a Hamburgal franchise, which Hamburgal agrees to support as long as Ben maintains his business license. Hamburgal's duty to perform is

a.not a condition.

b.a condition precedent.

c.a concurrent condition.

d.a condition subsequent.

22.Pedro agrees to buy Queen's World store business on the express condition that Robath Credit Union approves the financing. This approval is

a.not a condition.

b.a condition precedent.

c.a concurrent condition.

d.a condition subsequent.

23.Helen's Dress Shop., enters into a contract to pay Survey and Research, Inc. for a business survey and review of Helen's competitors, which Survey and Research delivers on August 1. Helen's offer, on the same date, to pay Survey and Research is

a. a concurrent condition.

b.a novation.

c.tender.

d.mutual rescission.