Question 1

Adam applied for a loan of $80,000, to purchase land from Chad. Chad makes an oral promise to Adam that he will allow Adam a period two months to accept his offer. Chad refuses to give this promise in writing. Discuss how Adam can ensure that the owner does not sell the land to another buyer in two months.

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Question 2

Canary offers in writing to sell her ranch to Erik for $150,000. A week later, when Erik is about to mail his acceptance, Canary dies in an auto accident. Canary's heir informs Erik that she is no longer interested in selling the ranch. Erik decides to move to court, stating that the offer cannot be revoked since he had already accepted the offer and was about to mail it. Analyze the case and discuss what the court is likely to rule?

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Question 3

Ptomaine is a chef who has opened a new restaurant. He agrees with Bob, a baker, that Bob will deliver 10 dozen hamburger and hotdog buns each morning at 6:00 a.m. as long as he doesn't call to cancel the next morning's delivery by 6:00 p.m. the evening before. This goes on for about ten days when Ptomaine realizes at 10:00 p.m. one evening that he has a surplus of buns. At 6:00 a.m. the next morning he refuses to accept the morning delivery. Discuss, with reference to common law, whether a contract exists.

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Question 4

Vanessa has assigned Leslie her rights to collect payments from Laura. Later, Vanessa assigned the same rights to collect her payments from Laura to Danielle. Discuss the legality of the case, and which assignee can claim rights to payments from Laura.

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Question 5

Steve, 17, intentionally misrepresents his age while buying a TV set from Rainbow Electronics. His father discovers this and forces Steve to return the television set and get back the money. Steve visits Rainbow Electronics and disaffirms the contract to buy the television set. Analyze the case.

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Question 6

What is a novation?

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Question 7

Discuss how undue influence creates voidable contracts.

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Question 8

Hume hired a security services agency to guard his warehouse. The arrangement of the security was such that Jim's house, located next to Hume's warehouse, was also protected. On one day, the security personnel don't show up, and Jim's house is burglarized. Jim files a lawsuit against the security services agency. Discuss the case.

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Question 9

Without permission, a duty that involves skill, character, or training cannot be delegated. Explain why.

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Question 10

Hailey and Ellen met with an auto accident, as a result of Ellen's over speeding. Hailey has suffered injuries, and due to an aftershock and trauma, 'cannot remember' what caused the accident. Ellen, who has suffered injuries herself, takes advantage of the situation and convinces Hailey that the accident was no one's fault. They sign a contract agreeing that neither will sue the other for damages. Analyze the case if the contract is challenged in court.

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Question 11

Mark entered into a written contract to sell Dobby his music collection for $10,000 payable in five installments. Mark then sells Cathy the right to collect the proceeds of his sale. Discuss Cathy's legal rights.

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Question 12

What is a covenant not to compete and under what conditions are they valid?

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Question 13

Sherry Shoe Company sends an offer by fax to Hulk Retailers to sell 100,000 pairs of shoes at $150 each, and mentions that it will hold the offer open for Hulk for two months. Four months after receiving Sherry's offer, Hulk faxes an acceptance. However, at this time Sherry has already entered a contract with another retailer. Discuss the situation.

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Question 14

Jacob and Janice enter into an oral contract, stating that Janice will sell her house to Jacob. Jacob makes the part payment to Janice as per the contract. During the time that Janice is vacating the house, Jacob hires a contractor to build a fence around the backyard to ensure security. However, Janice revokes her offer saying that a third party is paying a higher price for the house, and her offer to Jacob was not in written form. Jacob, who has spent $5,000 on the fencing, decides to sue Janice. Analyze the case.

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Question 15

Sarrah agrees to sell her house to Tiffany for $300,000. Tiffany replies that she will be glad to buy the house at $300,000, and asked if the price included the furniture. Sarrah replied that the furniture was not included. Tiffany agreed to pay $300,000, but Sarrah demanded $350,000, stating that Tiffany's counteroffer terminated the earlier offer. Discuss the case.

Accepted Answer

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Question 16

Explain the doctrine of promissory estoppel.

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Question 17

Explain the mailbox rule.

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Question 18

Kaylie and Josh visit Alice Jewels to buy a diamond engagement ring. The jeweler presents them a zircon ring and intentionally calls it a diamond. Kaylie loves the ring and Josh buys it, happy about gifting Kaylie a diamond ring. However, they later discover it is a zircon. Analyze on what grounds Josh can sue the jeweler.

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Question 19

Ray Contractors have agreed to build Yen's house for $25,000 in two years. However, six months after the work began, Ray Contractors demand an additional $5,000 from Yen to complete the work. Yen agrees, but when the work was completed, Yen pays Ray Contractors only $20,000. Ray decides to sue Yen. Analyze the case.

Accepted Answer

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Question 20

Stephanie hires Tommy to renovate her farm house and repair some minor damages for $1,000. Tommy informs her that it will take him at least 6 months to complete the work. Discuss whether the parties in question have to enter into a written agreement for such a contract to be enforceable.

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Quiz 8: Contract Formation