Question 1

Statements of fact about the past and present are called
A)provisions and terms.
B)promises and covenants.
C)representations and warranties.
D)damages and remedies.

Accepted Answer

Statements of fact about the past and present are known as representations and warranties. Provisions and terms refer to clauses in a contract, promises and covenants are future responsibilities or duties, and damages and remedies are potential outcomes if a party breaches a contract.

Question 2

Farmer's Fortune Insurance has a contract with Farmer Fran to insure her crops against insect damage.The contract does not specify which insects are covered or how much damage is necessary to make a claim.The contract will probably be enforced in favor of
A)Farmer Fran.
B)Farmer's Fortune Insurance.
C)Neither side, as it is ridiculous to try to insure against insects.
D)Cannot determine... would have to go through litigation to decide.

Accepted Answer

In the absence of specificity in the contract, courts generally interpret contracts in favor of the non-drafting party. In this case, Farmer Fran did not write the contract and therefore any ambiguity would be interpreted in her favor. Additionally, courts generally interpret insurance contracts liberally to provide coverage to insured parties.

Question 3

Standard provisions in a contract that are often listed under the heading "Miscellaneous" are called
A)boilerroom.
B)boilerplate.
C)boilerpot.
D)boilertape.

Accepted Answer

Boilerplate provisions are standard provisions that are commonly used in contracts and are often listed under the heading "Miscellaneous." These provisions can include things like the governing law of the contract, the method of dispute resolution, and the assignment and delegation of rights and responsibilities.

Question 4

Ralph is a professional football player.He signs a valid contract with the Miami Dolphins.Later,he claims that he was also promised free use of the Dolphins' private jet,but this was not in the contract.What type of clause in his contract would prevent him from flying away with this claim?
A)A complete agreement clause
B)A "no additional terms" clause
C)An integration clause
D)A severability clause

Accepted Answer

An integration clause, also known as a merger clause, is a provision that specifies that the written contract represents the entire agreement between the parties and supersedes all prior negotiations, understandings, or agreements. It prevents the parties from introducing evidence outside the four corners of the contract, including oral promises or representations made prior to the signing. Therefore, if Ralph's contract contains an integration clause, he cannot introduce evidence of any additional terms, including the alleged promise of free private jet use, unless he can show fraud, duress, mistake, illegality, or other vitiating factors that would render the contract void or unenforceable.

Question 5

Contract provisions that are enforceable independently are referred to as
A)covenantal promises.
B)conditional promises.
C)reciprocal promises.
D)material promises.

Accepted Answer

Reciprocal promises are those that are enforceable independently, meaning each party's promise is dependent on the other party's promise being fulfilled.

Question 6

Rich and Archie sign an agreement in which Archie agrees to deliver ten cases of champagne in 5 days.The parties negotiated and meant to say in the written agreement,delivery in 50 days.If the evidence is clear that the two parties intended to agree to 50 days,the courts will probably
A)reform the contract.
B)rescind the contract.
C)issue a warranty.
D)issue a covenant.

Accepted Answer

If the evidence is clear that the parties intended to agree to a different term than what was written in the contract, the court will reform the contract to reflect the parties' true intention. In this case, it is clear that the parties meant to agree to a delivery in 50 days instead of 5 days, so the court would likely reform the contract to reflect that intention.

Question 7

Bob,a house painter,contracts with Ollie to paint a rental house which Ollie owns.Bob hires Rob to take his place as the painter on this contract.What has Bob done?
A)Made a scrivener's error
B)Severed the contract
C)Delegated his duties
D)Assigned his rights

Accepted Answer

Bob has delegated his duties to Rob, which means that Rob will be responsible for completing the painting work outlined in the contract. However, Bob remains responsible to Ollie for ensuring that the work is satisfactory and completed on time.

Question 8

Which of the following is a standard provision frequently found in contracts?
A)choice of forum
B)understanding
C)choice of compensation
D)mediation

Accepted Answer

Choice of forum is a standard provision in contracts that specifies the jurisdiction or location where any disputes or legal actions related to the contract will be resolved. This provision helps avoid confusion and disagreement over where legal proceedings should take place.

Question 9

When one party to a contract fails to perform as promised,it is called
A)litigation.
B)breach.
C)liquidated damages.
D)bad faith.

Accepted Answer

When one party to a contract fails to perform as promised, it is called a breach of contract. Litigation refers to the process of resolving disputes through the court system, liquidated damages are pre-agreed damages in the event of a breach, and bad faith refers to a party acting dishonestly or unfairly in the negotiation or performance of a contract.

Question 10

Which of the following guidelines applies to writing the title of a contract?
A)It should be written in general terms, like "Memorandum of Agreement."
B)It should be written like a sentence, with only the first letter capitalized.
C)It should be brief with no more than five words.
D)It should be descriptive of the agreement, and typed in all capital letters.

Accepted Answer

The title of a contract should be descriptive of the agreement, and typed in all capital letters to make it stand out and easily identifiable. This helps distinguish the contract from other documents and provides clarity to those reviewing it. It is also recommended to keep the title brief, but there is no set limit on the number of words.

Question 11

A+ Modeling Agency signs a contract with Sandi to do a photo shoot for the local used car dealer's advertising.The contract was most likely written by
A)the owner of A+ Modeling Agency.
B)Sandi.
C)A+ Modeling Agency's lawyer.
D)Sandi's lawyer.

Accepted Answer

It is the responsibility of the party with more legal knowledge and experience to write the contract to ensure that it is fair and protects their interests. In this case, it would be A+ Modeling Agency's lawyer who would have written the contract.

Question 12

What is a force majeure event?
A)any action that makes the contract unprofitable for either party
B)any finding in a contract that shows a provision was deliberately left unclear
C)a disruptive, unexpected occurrence for which neither party is to blame that prevents one or both parties from complying with a contract
D)any happening that fulfills one of the conditions in the contract, making it enforceable

Accepted Answer

A force majeure event is a disruptive, unexpected occurrence for which neither party is to blame that prevents one or both parties from complying with a contract. It is typically a clause included in contracts to excuse a party's non-performance or delay in performance of contractual obligations in the event of such an occurrence. The other choices do not accurately describe what a force majeure event is.

Question 13

Nate works as a sales representative.His employment contract specifies that he cannot work for a competitor for a period of two years from employment.This is an example of
A)vagueness.
B)extortion.
C)ambiguity.
D)duress.

Accepted Answer

The term "cannot work for a competitor for a period of two years from employment" is clearly stated in the employment contract but it is ambiguous because it lacks specificity on what companies or positions would be considered as competitors.

Question 14

An honest effort to meet both the spirit and letter of the contract is termed
A)reasonable circumstances.
B)sole discretion.
C)honest representation.
D)good faith.

Accepted Answer

Good faith refers to an honest and sincere attempt to meet both the spirit and letter of a contract. It means that both parties agree to act honestly and fairly towards one another and to fulfill their obligations in a reasonable manner. Good faith is a fundamental principle of contract law and is essential to maintaining trust and integrity in business relationships.

Question 15

If the subject of the contract includes issues that may be controversial or "touchy," it is best to
A)keep lawyers out of the negotiation, so relationships are not strained.
B)deal with them up front before the relationship becomes strained.
C)deal with them one at a time, as the problems arise.
D)state your position up front and stand firm when the other party objects.

Accepted Answer

It is best to deal with controversial issues up front before the relationship becomes strained. This allows for open communication and negotiation to come to a mutually beneficial agreement. Ignoring or avoiding controversial issues only allows tensions to build and may lead to a breakdown in the relationship.

Question 16

When a provision in a contract is unclear by accident,it is a case of
A)vagueness.
B)mistake.
C)ambiguity.
D)condition.

Accepted Answer

When a provision in a contract is unclear by accident, it is a case of ambiguity. Vagueness refers to a lack of specificity or clarity intentionally, whereas mistake refers to an error in the content of the provision. A condition is a stipulation that must be met for the contract to be valid.

Question 17

Which of the following is generally NOT in the introductory paragraph of a contract?
A)The date of the contract
B)The covenants of the contract
C)The parties to the contract
D)The nature of the contract

Accepted Answer

The introductory paragraph of a contract usually includes the date of the contract, the parties to the contract, and the nature of the contract. However, the covenants of the contract are typically included in the body of the contract.

Question 18

Which of the following is NOT one of the three ways to amend a written contract?
A)by writing and signing an amendment (or rider)
B)by verbally agreeing to the changes and shaking hands on the deal
C)by crossing out the mistakes and writing in the corrections
D)by writing a totally new contract with the correct provisions

Accepted Answer

Verbally agreeing to changes and shaking hands on a deal is not a valid way to amend a written contract as it does not provide written documentation of the changes made to the original contract. The other three options (writing and signing an amendment, crossing out mistakes and making corrections, and writing a new contract) all provide written documentation of the changes made to the original contract.

Question 19

In a contract modification,the phrase "charged with such amendment" refers to
A)the party who suggested the change.
B)the party who will benefit from the change.
C)the party who will be adversely affected by the change.
D)the party who did NOT suggest the change.

Accepted Answer

The phrase "charged with such amendment" typically refers to the party who will bear the consequences or be adversely affected by the change in the contract. This could mean incurring additional costs, responsibilities, or any other negative impacts resulting from the amendment.

Question 20

Identify and explain at least four situations where a written contract is either necessary or recommended.

Accepted Answer

The answer of Identify and explain at least four situations...

Quiz 20: Practical Contracts

Statements of fact about the past and present are called

Farmer's Fortune Insurance has a contract with Farmer Fran to insure her crops against insect damage.The contract does not specify which insects are covered or how much damage is necessary to make a claim.The contract will probably be enforced in favor of

Standard provisions in a contract that are often listed under the heading "Miscellaneous" are called

Ralph is a professional football player.He signs a valid contract with the Miami Dolphins.Later,he claims that he was also promised free use of the Dolphins' private jet,but this was not in the contract.What type of clause in his contract would prevent him from flying away with this claim?

Contract provisions that are enforceable independently are referred to as

Rich and Archie sign an agreement in which Archie agrees to deliver ten cases of champagne in 5 days.The parties negotiated and meant to say in the written agreement,delivery in 50 days.If the evidence is clear that the two parties intended to agree to 50 days,the courts will probably

Bob,a house painter,contracts with Ollie to paint a rental house which Ollie owns.Bob hires Rob to take his place as the painter on this contract.What has Bob done?

Which of the following is a standard provision frequently found in contracts?

When one party to a contract fails to perform as promised,it is called

Which of the following guidelines applies to writing the title of a contract?

A+ Modeling Agency signs a contract with Sandi to do a photo shoot for the local used car dealer's advertising.The contract was most likely written by

What is a force majeure event?

Nate works as a sales representative.His employment contract specifies that he cannot work for a competitor for a period of two years from employment.This is an example of

An honest effort to meet both the spirit and letter of the contract is termed

If the subject of the contract includes issues that may be controversial or "touchy," it is best to

When a provision in a contract is unclear by accident,it is a case of

Which of the following is generally NOT in the introductory paragraph of a contract?

Which of the following is NOT one of the three ways to amend a written contract?

In a contract modification,the phrase "charged with such amendment" refers to

Identify and explain at least four situations where a written contract is either necessary or recommended.