Question 1

Michael enters into a contract with Tara whereby she will make 500 chocolate truffles to be delivered the next day at 12:00 pm. Tara delivers the 500 truffles the next day at 12:05 pm. Michael refuses to pay her because he states she breached the term of the contract of delivery time. The court will agree with Michael because she did indeed breach the contract terms.

Accepted Answer

In legal terms, a delay of 5 minutes in delivering the truffles is likely to be considered a minor breach (if it is considered a breach at all), which typically does not discharge the aggrieved party (Michael) from their obligation to pay, especially if the delay did not cause any significant harm or loss. Courts often look at the materiality of the breach and its impact on the fulfillment of the contract's overall purpose.

Question 2

When both parties fulfill the terms of the contractual duties, the contract is terminated.

Accepted Answer

When both parties fulfill their respective duties as outlined in the contract, the contract is considered executed, and thus, it is terminated because its terms have been fully satisfied.

Question 3

When a contract has terms such as "provided that" or "unless" in a contract that indicates a performance obligation that is called a
A) Condition subsequent
B) Condition precedent
C) Condition delegate
D) Condition substantive

Accepted Answer

These terms indicate a condition precedent, which means a certain event or action must occur before a party is required to perform their obligations under a contract.

Question 4

The process by which parties to a contract perform their obligations in good faith and fulfill the terms of the contract is called
A) Completion
B) Novation
C) Delegation
D) Discharge

Accepted Answer

Discharge refers to the fulfillment of the terms of a contract, where parties perform their obligations, leading to the termination of the contract.

Question 5

The process by which the original parties to a contract agree to allow an outside party to perform the contract is called a
A) Accord and Satisfaction
B) Novation
C) Discharge
D) Rescission

Accepted Answer

Novation is the process where the original parties to a contract agree to substitute a new party for one of the original parties, thereby allowing an outside party to perform the contract. This involves the mutual agreement of all parties involved, including the new party.

Question 6

Hannah is employed by Munchin Financial. As an employee benefit, the employer will pay for employees to earn their Masters in Financial Accounting provided that they agree to work exclusively for Munchin Financial for five years following graduation. If an employee does not work the additional five years there, then that employee must repay Munchin Financial the total cost of the tuition. This provision of the contract is called
A) Clawback
B) Buyback
C) Restitution
D) Reimbursement

Accepted Answer

This provision is known as a "Clawback" because it involves the employer reclaiming the cost of tuition if the employee does not fulfill the specified condition of working for the company for an additional five years after graduation.

Question 7

In the case, Lucente v. IBM, differentiated when a covenant not to compete can be enforced by the employer against the employee and determined that it can be applied
A) Never as all covenants not to compete are illegal per se
B) Only when the employee chooses to leave the employer
C) Only when the employer decides to terminate the employee
D) Any time an employee leaves a place of employment

Accepted Answer

The court in Lucente v. IBM determined that a covenant not to compete can be enforced when the employee voluntarily chooses to leave the employer, as it is considered reasonable under such circumstances.

Question 8

Kristen hires Gabby to babysit her three children for the day. As soon as Gabby sees Kristen pull out of the driveway, she tells the kids to be quiet and just sit there because she wants to sleep. While Gabby sleeps, the wild children destroy the house. Is Kristen obligated to pay Gabby the price she agreed to for babysitting?
A) Yes, except Kristen would be able to deduct the damages that the kids did while the house while Gabby slept.
B) Yes because Gabby was indeed at the house the entire day and the courts do not require perfect performance.
C) No because while courts do not require perfect performance, they do require a good faith attempt at perfect performance.
D) No because the contract was illegal as the fact pattern does not indicate that Gabby was properly licensed to babysit.

Accepted Answer

Gabby's failure to make a good faith attempt at performing her duties as a babysitter, by choosing to sleep instead of supervising the children, breaches the implied condition of the contract that she would actively care for the children. This breach justifies Kristen's non-payment.

Question 9

Kelly agrees to provide a two hour goat yoga class for Tara and Gabby for $20.00 each. An hour and 50 minutes into the lesson, Kelly misreads the clock and dismisses Tara and Gabby from the lesson. Can Tara and Gabby sue for breach of contract?
A) No if the court determines that 10 minutes less is not a material breach and Kelly acted in good faith.
B) Yes they will be able to recover a proportion of the cost of the class that was not fulfilled.
C) No because a 10 minute loss of a goat yoga lesson is not a recognizable damage.
D) Yes if the court determines that the reasonable person would have wanted the additional 10 minutes.

Accepted Answer

A court may determine that the 10-minute shortfall is not a material breach, especially if Kelly acted in good faith, meaning Tara and Gabby may not have a strong case for breach of contract.

Question 10

In the Reading Pipe case, the contractor installed the wrong brand of piping throughout the building that was specifically stated in the contract. Once it was discovered, it was far too late in the construction process to replace all the pipes without a substantial extra cost to the contractor. What was the resolution of the case when the contractor was sued by his client for breach of contract?
A) The court ordered the contractor to replace all the pipes to conform with the terms of the contract.
B) The court determined that the breach was not material as it did not frustrate the purpose of the contract.
C) The court determined there was a substantial breach since the contract specifically called for a certain brand of pipes.
D) The court determined that fairness required that the contract reimburse the client half of the value of the contract.

Accepted Answer

The court determined that the breach was not material as it did not frustrate the purpose of the contract, meaning the functionality and purpose of the building were not compromised by the use of a different brand of piping.

Question 11

Rachel contracts with Ryan to teach her how to dance each Thursday night for four hours a night for two months. Two days before the first lesson, Rachel calls up Ryan to tell him that she really does not want to do the lessons anymore and Ryan says he didn't really want to either. Therefore, they both agree to just forget about the contract. This is an example of a
A) Reformation
B) Substitution
C) Rescission
D) Restitution

Accepted Answer

This is an example of a rescission, where both parties mutually agree to cancel the contract.

Question 12

Edith hires Randal an attorney at Parker Law Offices to write her will. Randal asks his paralegal, Polly, to write Edith's will while he goes on vacation and mail it to her to sign. Is this a proper accord and satisfaction?
A) Yes because a paralegal can write a will.
B) Yes because Edith hired Randal to perform a service which his agent is providing.
C) No because Polly did not interview Edith.
D) No because as a paralegal, Polly is not licensed to write a will as the attorney is.

Accepted Answer

Polly, as a paralegal, is not licensed to practice law, which includes drafting legal documents such as wills. This task requires the expertise and legal authority of a licensed attorney, which Randal, not Polly, possesses.

Question 13

Myra agrees to sell Connie her house for $250,000.00. The next day, a tornado destroys the house. Will either party be bound by the terms of the contract?
A) No because the contract becomes impossible due to the destruction of the subject matter.
B) No because the contract becomes impractical due to the destruction of the subject matter.
C) No unless both parties agree to rescind the contract.
D) Yes, however out of fairness the courts will allow additional time to repair the house.

Accepted Answer

The destruction of the house, which is the subject matter of the contract, renders the contract impossible to perform. Therefore, neither party is bound by the terms of the contract.

Question 14

Lorna visited Beaulah, her hair stylist every Friday of her adult life to have her hair fixed. She always paid a week ahead of time to ensure that Beaulah always reserved the time the following week. In between visits, Lorna dies and her family asked Beaulah to come to the funeral home and fix Lorna's hair there. Beaulah refuses. Will Lorna's family be successful in a breach of contract case because Beaulah refuses to fix Lorna's hair after her death?
A) Yes as she made a promise to fix her hair and it does not matter if she is dead or alive.
B) No because the death of one of the parties of the contract makes the contract impossible and thus the parties are discharged.
C) Yes contracts that are created while both parties are alive are enforceable even when one of the parties dies if it is reasonably possible.
D) No because the reasonable person would not want to complete the terms of this contract.

Accepted Answer

The death of one of the parties involved in a contract typically renders the contract impossible to fulfill, thereby discharging the parties from their obligations under the contract. In this case, Lorna's death makes it impossible for Beaulah to continue providing the service as agreed, thus nullifying the contract.

Question 15

Lonnie's Liquor store agreed to purchase 90 proof moonshine from Moonshine Manufacturing Inc. Before Moonshine Manufacturing can ship the product to Lonnie's, a law is passed making the production, sale and consumption of moonshine illegal. Which statement below is correct?
A) Since the parties agreed to the terms of the contract while it was still legal, this contract is grandfathered and the parties will be bound by it.
B) The parties will be bound by the terms of the contract unless the both agree to rescind it.
C) The contract is impossible to complete due to the law now making the subject matter illegal.
D) The contract is now impractical and the parties can renegotiate the terms.

Accepted Answer

The contract becomes impossible to perform legally due to the new law, rendering the subject matter of the contract illegal. This makes the contract void and unenforceable.

Question 16

Renee's housekeeper has the stomach flu and cannot keep her scheduled cleaning appointment to clear Renee's house as scheduled. Has the contract been discharged?
A) No and Renee can sue her for breach of contract.
B) Yes because an illness makes the contract unenforceable.
C) No because the reasonable person can still clean a house when sick.
D) No because her illness is temporary and will only suspend her duty.

Accepted Answer

The contract is not discharged; it is temporarily suspended due to the housekeeper's illness, which prevents her from performing her duties at the scheduled time. Once she recovers, she can fulfill her obligations under the contract.

Question 17

All of the following are examples of a force majeur except
A) Threat of terrorism
B) A broken engagement
C) A natural disaster
D) An embargo

Accepted Answer

A force majeure refers to unforeseeable circumstances that prevent someone from fulfilling a contract. Threats of terrorism, natural disasters, and embargoes are all external, uncontrollable events that can be considered force majeure. A broken engagement, however, is a personal decision and not an external event, thus it does not qualify as force majeure.

Question 18

If a contract becomes extremely burdensome due to some unforeseen circumstance, the contract may be discharged due to
A) Impossibility
B) Illegality
C) Impracticability
D) Consideration

Accepted Answer

Impracticability refers to situations where fulfilling the terms of a contract has become unfeasibly difficult or expensive due to unforeseen circumstances, potentially allowing for the contract to be discharged.

Question 19

Tasha contracts with Marquel to mow her lawn. Totally unexplained and unplanned, it snow six inches before Marquel is supposed to mow her lawn. Most likely the contract will be discharged by operation of law under the concept of
A) Illegality
B) Impossibility
C) Imbalance
D) Impracticability

Accepted Answer

The answer of Tasha contracts with Marquel to mow her...

Question 20

Frustration of purpose requires all of the following to occur except
A) One party to the contract will be unjustly enriched
B) The principal purpose of the contract is substantially frustrated
C) Neither party of the contract is not at fault
D) The non-occurrence of the event was the central assumption of both parties when entering into the contract

Accepted Answer

Frustration of purpose occurs when an unforeseen event undermines a party's principal purpose for entering into a contract, but it does not involve unjust enrichment of one party as a necessary condition.

Quiz 10: Performance

When both parties fulfill the terms of the contractual duties, the contract is terminated.

When a contract has terms such as "provided that" or "unless" in a contract that indicates a performance obligation that is called a

The process by which parties to a contract perform their obligations in good faith and fulfill the terms of the contract is called

The process by which the original parties to a contract agree to allow an outside party to perform the contract is called a

In the case, Lucente v. IBM, differentiated when a covenant not to compete can be enforced by the employer against the employee and determined that it can be applied

Kelly agrees to provide a two hour goat yoga class for Tara and Gabby for $20.00 each. An hour and 50 minutes into the lesson, Kelly misreads the clock and dismisses Tara and Gabby from the lesson. Can Tara and Gabby sue for breach of contract?

Edith hires Randal an attorney at Parker Law Offices to write her will. Randal asks his paralegal, Polly, to write Edith's will while he goes on vacation and mail it to her to sign. Is this a proper accord and satisfaction?

Myra agrees to sell Connie her house for $250,000.00. The next day, a tornado destroys the house. Will either party be bound by the terms of the contract?

Lonnie's Liquor store agreed to purchase 90 proof moonshine from Moonshine Manufacturing Inc. Before Moonshine Manufacturing can ship the product to Lonnie's, a law is passed making the production, sale and consumption of moonshine illegal. Which statement below is correct?

Renee's housekeeper has the stomach flu and cannot keep her scheduled cleaning appointment to clear Renee's house as scheduled. Has the contract been discharged?

All of the following are examples of a force majeur except

If a contract becomes extremely burdensome due to some unforeseen circumstance, the contract may be discharged due to

Tasha contracts with Marquel to mow her lawn. Totally unexplained and unplanned, it snow six inches before Marquel is supposed to mow her lawn. Most likely the contract will be discharged by operation of law under the concept of

Frustration of purpose requires all of the following to occur except