American Contract Law I

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American Contract Law I

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Week- 1

Introduction

 

1.
Question 1
A court adopts a rule, but says that parties to a contract can change
the rule if they explicitly agree. What kind of rule is this?

1 point

  • Default
  • Mandatory

2.
Question 2
Which theory of consideration is dominant in the United States?

1 point

  • The
    benefit-detriment theory.
  • The bargained-for theory of consideration.

3.
Question 3
When Gratuitous Grandpa hears his Darling Daughter is pregnant with his
grandson, he writes her a letter promising to give her a “couple thousand
dollars” when the boy is born so that “she and her husband can by something
nice for the boy.”

His daughter
immediately goes out and buys a $7,500 designer crib. After the baby is born, Darling asks
Gratuitous for the $7,500.

When he
refuses to pay her such an “outrageous sum wasted on an ugly crib” she sues him
for the $7,500, arguing that his gratuitous promise is binding under the theory
of promissory estoppel.

What result and
why?

1 point

  • A. Darling’s suit
    will likely succeed. Grandpa made a promise and should be held to it.
  • B. Darling’s suit will likely fail. Because Grandpa made the promise, he can withdraw it whenever he wants.
  • C. Darling’s suit will likely succeed. Grandpa’s promise induced her to go out and spend $7,500 in reliance on the promise.
  • D. Darling’s suit will likely fail. Grandpa would not have reasonably expected her to spend so much on the crib.

4.
Question 4
Which of the following is true of promissory estoppel?

1 point

  • A.
    A
    condition of promissory estoppel is that the promisee actually relies on the
    promise.
  • B. Under promissory estoppel damages are limited to reliance damages.
  • C. Both of the above.
  • D. None of the above.

5.
Question 5
Credulous Consumer walks into a furniture store aiming to buy an
armchair. Shady Seller offers CC a top-of-the-line armchair for $1000.

Consumer
has bought several pieces of furniture on installment from Seller before and is
still paying off two of them. Consumer cannot afford to pay the cost of the
armchair up-front and proposes an alternative deal. CC will pay the price of
the armchair, plus twenty percent interest, over the next year. If CC misses
just one payment, not only can Seller keep all the payments CC has made so far
and reclaim the armchair, but Seller can also reclaim the two other pieces of
furniture CC is still paying off.

Seller asks CC if he is sure he wants to agree
to these terms, and points out the extreme consequences of missing a payment. Seller
suggests several reasonable alternative financing plans. CC replies, “Don’t
worry—I know the terms are lopsided. I want to show you that I am trustworthy.”

Eight months later, CC misses a payment and Seller sues for all three pieces of
furniture. CC argues that the contract was unconscionable and should not be
enforced under the test set out in Walker-Thomas
Furniture. The trial court determines that the terms were unreasonably
favorable to Seller.

Is CC’s argument likely to succeed?

1 point

  • A.
    Yes.
    The contract is both procedurally and substantively unconscionable.
  • B. Yes. The contract is procedurally unconscionable, but not substantively unconscionable.
  • C. Yes. The contract is substantively unconscionable, but not procedurally unconscionable.
  • D. No. The contract is procedurally unconscionable, but not substantively unconscionable.
  • E. No. The contract is substantively unconscionable, but not procedurally unconscionable.
  • F. No. The contract is neither procedurally unconscionable nor substantively unconscionable.

6.
Question 6
Person A
owns a car. Person B takes the car from Person A without permission. Person A
sues Person B and the court determines that Person B unlawfully took Person A’s
car. The court wants to protect Person A’s property right in the car. Which of
the following orders would be aimed towards protecting a property right?

1 point

  • A.
    Person
    B must pay Person A the cost of purchasing a new car, but can keep the car.
  • B. Person B must return the car to Person A, unless Person B and Person A can agree on a price at which Person A would be willing to sell the car.
  • C. Person B can keep the car and does not have to pay Person A.
  • D. Person B can keep the car, but must pay Person A the fair market value of the car.

7.
Question 7
Which rule for a buyer’s duty to pay did the court adopt in Jacob & Youngs v. Kent? (Reading Pipe Case)

1 point

  • A.
    Perfect
    Tender
  • B. Substantial Performance
  • C. Unconditional Contractual Duty to Pay

8.
Question 8
Did the court adopt the Jacob & Youngs v Kent ruling as a mandatory rule?

1 point

  • Yes
  • No

9.
Question 9
What is the goal of reliance damages?

1 point

  • A.
    To
    put the non-breaching party in the pre-contract position.
  • B. To stop the breaching party from profiting from the breach.
  • C. To put the non-breaching party in the position they would have been in had the breaching party performed.

 

Week-2 

Consideration and its Substitutes the Consideration Doctrine I

 

1.
Question 1
Under
what theory was the court willing to enforce the repudiated pension in Langer v. Superior Steel (repudiated pension)?

1 point

A. As a valid contract backed by consideration

B. Promissory estoppel

C. Both

D. Neither

2.
Question 2
Party
X is an employee of a large company. When X retires, the company tells her that
they will pay her a stipend for the rest of her life if she gives them the
address where they can mail the pension checks. Under Williston’s “benefit
test” (described in the lecture for the repudiated pension case, Langer v. Superior Steel), is it fair to
infer that Party X giving the company her address was requested as
consideration for the company’s promise?

1 point

Yes

No

3.
Question 3
Would
a promise to give a new car in exchange for a penny be supported by
consideration under the First Restatement? Under the Second Restatement?

1 point

A.
The promise would be valid under the First Restatement.

B. The promise would be valid under the Second Restatement.

C. Both A and B.

D. Neither A nor B.

4.
Question 4
Section
21 of the Second Restatement reads, “Neither real nor apparent intention that a
promise be legally binding is essential to the formation of a contract, but a
manifestation of intention that a promise shall not affect legal relations may
prevent the formation of a contract.”

Is the rule “[n]either real nor apparent intention
that a promise be legally binding is essential to the formation of a contract”
a default rule or a mandatory rule?

1 point

A.
Default

B. Mandatory

5.
Question 5
Maria
asks her brother to attend a dinner party she is throwing. He agrees. Is this
promise legally enforceable?

1 point

A. Yes

B. No

6.
Question 6
Party
B wants to purchase the rights to Party A’s idea. B had never heard any idea
similar to A’s before A disclosed the idea to B. It’s very important to B that
A’s idea is truly original. If A and B enter into a contract by which B will
pay to use A’s idea, how might B make the novelty of A’s idea—or lack
thereof—matter, despite the Apfel
(worthless computer technique) decision?

1 point

A.
Party B can make the novelty of the idea a condition of the contract.

B. Party A can agree not to disclose the idea to anybody except Party B.

C. Party B can refuse to pay after discovering that the idea was not novel, arguing that the technique was worthless and the contract lacked consideration.

7.
Question 7
What
evidence can the court look at to determine whether a contract is
unconscionable under UCC 2-302?

1 point

A. The terms of the contract

B. The commercial setting, purpose, and effect of the contract

C. A and B

8.
Question 8
If
a court finds a contract to be unconscionable under UCC 2-302, it has the
option of one of the following EXCEPT :

1 point

A. Refusing
to enforce the contract

B. Enforce the contract without the unconscionable clause

C. Limit the application of the unconscionable clause

D. Penalize the seller by making the seller pay punitive damages.

9.
Question 9
Shady
Salesperson agrees that Credulous Customer will buy a computer for $800. After
Customer pays the $800, Salesperson demands another $400 to turn over the
computer. Customer does not have $400 with her, but promises to mail
Salesperson the extra money the next day. Salesperson agrees and turns over the
computer. A week later, Customer still has yet to mail the money and
Salesperson sues. Customer argues that the contract to pay $400 was invalid. Is
she right?

1 point

A.
Yes.

B. No.

10.
Question 10
Lizzy Lender calls up Bobby Borrower and asks
him to pay the $1,000 he owes her, saying it was due yesterday. Borrower responds that he already made a $500
payment, so he only owes her $500. After
a long argument, Lender threatens to sue.
To avoid a lawsuit, Borrower offers to pay Lender $700 to settle his
debt. Lender agrees, and Borrower pays
her. A week later, Lender sues Borrower
for the remaining $300, arguing that Borrower’s agreement to pay her $700 to
discharge his debt was not consideration because he had a pre-existing duty to
repay her. Is Lender correct?

1 point

A. Yes

B. No

 

 

Week-3 

Consideration and its Substitutes the Consideration Doctrine II

 

1.
Question 1
In
McMichael v. Price (the “Sand
Requirements” case) did Price (the sand purchaser) have any obligation to
McMichael (the sand buyer)? If so, what was Price’s obligation?

1 point

A. Yes, to purchase sand exclusively from McMichael at the agreed upon price.

B. Yes, to purchase as much sand as McMichael could produce.

C. No, because Price could avoid any obligation to McMichael by going out of business.

2.
Question 2
UCC
§ 2-306(2) states that “[a] lawful agreement by either the seller or the buyer
for exclusive dealing in the kind of goods concerned imposes unless otherwise
agreed an obligation by the seller to use best efforts to supply the goods and
by the buyer to use best efforts to promote their sale.” Is this a default or
mandatory rule?

1 point

A. Default

B. Mandatory

3.
Question 3
In
Bailey v. West (the “Bascom’s Folly”
case), the Rhode Island Supreme Court reviewed the factual question of “whether
or not plaintiff was acting as a ‘volunteer’ at the time he accepted the horse
for boarding at his farm.” What standard of review did the court apply?

1 point

A. De novo

B. Clear error

4.
Question 4
You
are the director of a charity and you are suing someone who promised to donate
to your charity under a theory of promissory estoppel. Which of these facts
would be most helpful to your case?

1 point

A. You have already included their donation in your spreadsheets for planning next year.

B. You have taken out loans based on the expectation that their donation could be used to repay the loans.

C. You knew that this donor had failed to make promised donations in the past.

D. The donor was told that the donation was just a “drop in the bucket” and would not have a big impact on your organization’s finances.

5.
Question 5
1.
Did the Massachusetts Supreme Judicial Court find that “moral
obligation” was sufficient consideration to legally bind Wyman’s promise to reimburse
Mill’s the cost of caring for his son in Mills
v. Wyman?

1 point

A. Yes.

B. No.

6.
Question 6
Under
the holding in Webb v. McGowin (the
“Rescuer’s Recompense” case), which change in facts would be most likely to
cause Mills v. Wyman (the “Moral
Obligation” case) to come out differently?

1 point

A.
Wyman
already owed Mills money.

B. Wyman did not repudiate his promise, but died before fulfilling it, and his executor refused to pay Mills.

C. Wyman’s promise was made in writing.

D. Mills cared for Wyman, instead of Wyman’s son.

7.
Question 7
Generous
Gifter walks up to a stranger and gives the stranger a car as a present.

The
stranger, overwhelmed with gratitude, later finds Generous Gifter and promises
to pay Gifter the value of the car.

Is the stranger’s promise enforceable under
§ 86(1) of the Second Restatement?

1 point

A. Yes.

B. No.

8.
Question 8
What
measure of damages have courts applied in promissory estoppel cases?

1 point

A. Expectation Damages

B. Reliance

C. Either A or B

9.
Question 9
Does
failure to comply with the statute of frauds make an agreement unenforceable?

1 point

A.
Yes,
always

B. If the party being sued decides to void the agreement

C. No

10.
Question 10
Which
of the following agreements would be subject to the statute of frauds?

Please select all that apply.

1 point

A.
A
contract to sell an empty lot

B. A contract to sell $150 worth of groceries

C. A contract to perform renovations two years after making the contract

D. A contract to sell a computer worth $600.

 

 

Week- 4

The Bargain Relationship I

 

1.
Question 1
In
Embry v. Hargadine, McKittrick Dry Goods
Co. (the “Manifestation of Mutual Intent” case), did McKittrick, the
President, agree to renew Embry’s contract when he said, “Go ahead, you are all
right; get your men out and do not let that worry you”? Why or why not?

1 point

A.
Yes,
because Embry and McKittrick both admitted that they intended to renew the
contract.

B. Yes, because a reasonable person would have understood McKittrick’s words to be an agreement to renew the contract.

C. No, because a reasonable person would not have understood McKittrick’s words to be an agreement to renew the contract.

D. No, because McKittrick did not intend to renew the contract.

2.
Question 2
Which
of the following facts from Lucy v.
Zehmer (the “Joking Offer” case) support the conclusion that Lucy and
Zehmer formed a binding contract?

1 point

A.
That
they had both been drinking.

B. That the parties discussed the terms for forty minutes before signing the agreement.

C. The completeness of the written document.

D. Both B and C.

3.
Question 3
A
lumber store sends a letter to a carpenter offering to sell her birch wood at
$3.50 per board foot. The letter concludes, “this offer will stay open for ten
days.” Two days later she calls the lumber store and they tell her that the
price has gone up to $4.00 per board foot. Which price is valid?

1 point

$3.50

$4.00

4.
Question 4
Consider
the following hypothetical:

A
farmer was exercising his fine registered Belgian stallion in a field adjacent
to the road when he was addressed by an unkempt ragged tramp that was walking
by. After the tramp had asked some questions about the horse’s age, breeding,
etc., he asked the farmer, “How much will you take for him?” The
farmer smilingly replied, “I’ll sell him for $200 cash.” “All
right,” replied the tramp, “I’ll take him.” At the same time he
handed the horse’s owner an envelope. When the envelope was opened it was found
to contain ten new $20 bills. The farmer immediately tendered the money back to
the tramp saying, “I had no idea you had so much money. This horse is not
for sale. He would bring $2,000 on the auction block. It’s impossible for me to
let you have him for $200.” But the tramp refused to accept the money, and
insisted that he had bought the horse.

Would
the farmer be bound to the sale under the objective theory? How about under
Sharp’s reliance approach?

1 point

A. Yes, the farmer would be bound under either theory

B. The farmer would be bound under the objective theory, but not Sharp’s reliance approach

C. The farmer would be bound under Sharp’s reliance approach, but not the objective theory

D. The farmer would not be bound under either theory

5.
Question 5
Imagine
a similar hypothetical:

A
woman is exercising her racehorse in a field adjacent to the road when she was
addressed by an unkempt ragged tramp that was walking by. After the tramp had
asked some questions about the horse’s age, breeding, etc., he asked the owner,
“How much will you take for him?” The owner smilingly replied,
“I’ll sell him for $200 cash.” “I’ll take the deal,” the tramp said.
“Can I get you the cash tomorrow?” “Of course,” the owner replied. The tramp
found and hired a championship jockey and rented a stable—paying the first
month of the jockey’s salary and the first month’s rent on the stable up front.
The tramp then returned and handed the horse’s owner an envelope. When the
envelope was opened it was found to contain ten new $20 bills. The owner
immediately tendered the money back to the tramp saying, “I had no idea
you had so much money. This horse is not for sale. He would bring $2,000 on the
auction block. It’s impossible for me to let you have him for $200.” But
the tramp refused to accept the money, and insisted that he had bought the
horse.

Would
the owner be bound to the sale under the objective theory? How about under
Sharp’s reliance approach?

1 point

A.
Yes,
the owner would be bound under either theory

B. The owner would be bound under the objective theory, but not Sharp’s reliance approach

C. The owner would be bound under Sharp’s reliance approach, but not the objective theory

D. The owner would not be bound under either theory

6.
Question 6
Jose
sees an ad offering “Sale this Sunday: DVDs up to 50% off or more!” He goes to
the store on Sunday, but they refuse to sell him DVDs for anything less than
list price. Does he have a claim for breach of contract?

1 point

Yes

No

7.
Question 7
Which of the following ads would Justice Murphy, using
his reasoning in Lefkowitz (the
“Ambiguous Offer” case), be most likely to consider an offer?

1 point

A. “Sale: our lowest prices this season”

B. “Two-for-one deals on some cookies this weekend”

C. “The first five customers who present this ad on Monday can purchase this laptop worth $800 for $300.”

D. “Up to $10 or more off DVDs”

8.
Question 8
Pat submits her advertisements to the newspaper weeks
in advance, long before she knows what she will have in stock on a certain day.
If she wants to avoid liability when customers show up at her store and she
doesn’t have what was advertised, what sort of wording should she use in the
advertisements?

1 point

A.
Ambiguous, indefinite, and vague

B. Clear, definite, and explicit

9.
Question 9
Which
of the following facts did the court in Leonard
v. PepsiCo (the “Harrier Jet Ad” case) say shows that an objective,
reasonable person would not have considered the ad to be an offer?

1 point

A. The fact that other items in the commercial were available to purchase with Pepsi Points.

B. The possibility that other people interpreted the commercial as an offer of a Harrier Jet.

C. The obvious absurdity of the commercial.

D. B and C.

10.
Question 10
Katy
sees a poster taped to a tree. The poster features a photograph of an adorable
Labrador puppy; in huge print surrounding the photograph are the words “PUPPY
LOST! $1000 REWARD!” Listed, as well, is the phone number of the owner. Katy
sees playing in the street a puppy who looks similar to the dog in the
photograph, and calls the owner, who comes immediately to the location and
scoops up his pet. Katy asks for her reward, and the owner refuses to provide
it. Applying the court’s reasoning in PepsiCo
(the “Harrier Jet Ad” case), will Katy recover?

1 point

A.
Yes,
because rewards are always offers.

B. No—the poster does not specify how to accept the offer.

 

 

Week-5 

The Bargain Relationship II

 

1.
Question 1
How
did the plaintiffs (the roofing company) in Ever-Tite
Roofing Co. v. G.T. Green accept the defendants’ offer and enter into a
contract to re-roof the house?

1 point

A. The plaintiffs never accepted the defendants’ offer

B. Written acceptance by the company’s sales representative

C. Written acceptance by a principal or authorized officer of the company

D. By commencing performance of the work

2.
Question 2
What
remedy did the court order in Ever-Tite
Roofing Co.?

1 point

A.
Expectation
damages

B. Expectation damages and attorney’s fees

C. Reliance damages

D. No damages

3.
Question 3
What
was the consideration in Carlill v.
Carbolic Smoke Ball?

1 point

A. There was no consideration

B. The money that the defendants would get from increased use of the smoke balls

C. The inconvenience of using the smoke ball

D. B and C

4.
Question 4
Alice
tells Bob that she’ll be out of town the week after next. If he mows her lawn
while she is gone, she will give him $20. However, if he cannot mow her lawn,
she will need to find someone else. She asks him to let her know whether he is
accepting her offer before she leaves town. Is this an offer for a unilateral
or bilateral contract?

1 point

A.
Unilateral

B. Bilateral

5.
Question 5
Did the court rule
that Wilson & Co. had accepted Ammons’s order to buy shortening in R.L. Ammons v. Wilson & Co. (the
“K.C. Shortening” case)?

1 point

A.
Yes,
the court ruled that Wilson & Co. had explicitly accepted the order when
Ammons sent it in through the traveling salesman, Tweedy.

B. Yes, the court ruled that Wilson & Co. had implicitly accepted the order by waiting twelve days to reject it.

C. No, the court ruled that no contract existed because Wilson & Co. had never accepted the order.

D. The court ruled that the jury would have to decide whether Wilson & Co. had implicitly accepted the order.

6.
Question 6
Bob
signs a credit card agreement with ABC Bank. A couple of years later, ABC Bank
mails a notice to Bob’s address, which clearly states that six months hence,
the Bank will increase the finance charge on his account and that Bob can write
back to reject the change. Bob does not see the notice. ABC Bank mails an
additional notice three months later. Bob throws away the envelope unopened,
assuming it’s junk mail. The new terms go into effect as scheduled. The
original agreement Bob signed had a provision allowing the Bank to change the
terms after giving the cardholder notice. Is Bob bound by ABC Bank’s increased
finance charge?

1 point

 

A.
Under
the Long holding (discussed in the Beneficial Bank reading), no, because
acceptance of the change to the finance charges cannot be based solely on Bob’s
failure to opt out of those changes.

B. Under the Long holding, it is unclear, because that case discussed arbitration clauses, not changes to finance charges.

C. Under the Beneficial Bank (the “Unilateral Credit Card Change” case) holding, yes, because he did not write back to the Bank to opt out.

D. Under either holding, no, because he did read the notice of changes.

E. Both B and C are correct.

7.
Question 7
Under
the Restatement (Second) of Contracts, which of the following do not take effect
at the time they are received?

1 point

A.
Offers

B. Revocations

C. Acceptances for contracts that are not option contracts

D. Acceptances for option contracts

E. Both A and C.

8.
Question 8
Which
one of the following methods of acceptance is valid under the Restatement
(Second)?

1 point

A. A mailed letter indicating acceptance of an offer letter. The acceptance letter was lost in the mail.

B. A mailed letter indicating acceptance of an options contract. The acceptance letter was lost in the mail.

C. A mailed letter indicating acceptance of a telegram marked “Highly urgent, response required immediately.”

D. None of the above.

9.
Question 9
1.
Which
of the following could be justifications for the mailbox rule, as stated in
Section 63 of the Second Restatement?

1 point

A. The mailbox rule sets the default against the offeror because the offeror is master of the offer and empowered to alter it.

B. The offeror should not be bound until she is aware the offer has been accepted.

C. Requiring more confirmations is probably a waste of social resources.

D. All of the above.

E. Both A and C.

10.
Question 10
Party
X mails Party Y an offer to remodel Party Y’s house.

Party Y receives Party X’s
offer and sends a counteroffer by mail.

An hour after dropping the counteroffer
in the mailbox, Party Y has a change of heart and decides to accept Party X’s
offer.

Party Y writes a letter accepting the initial offer and drops it in the
mailbox.

Can Y’s acceptance be valid?

1 point

A.
Yes,
the mailbox rule means that Party Y’s acceptance took effect when Y mailed it
to Party X.

B. Yes, Party Y’s acceptance will be valid if Party X receives the acceptance before the counteroffer.

C. No, a counter-offer terminates the power of acceptance when it is sent by mail.

 

 

Week- 6

The Bargain Relationship III

 

1.
Question 1
Susan
offers to paint the outside of Sam’s house for $2,800. Sam says, “I’d accept
your offer if you painted the outside of my house plus my kitchen for $3,000?”
Susan says, “No, my team does not paint kitchens.” A day later, Sam calls Susan
and says, “I’ve changed my mind—I accept your earlier offer.” However, Susan
has had several new clients come in and replies that she can no longer fit
Sam’s house into her schedule. Is Susan bound by her offer?

1 point

Yes

No

2.
Question 2
Is
the Mirror Image rule, as stated in Restatement (Second) § 32 a mandatory
rule or default rule?

1 point

A. Mandatory

B. Default: It can be altered by the initial offeror.

C. Default: It can be altered by the party making a counteroffer

D. Default: It can be altered by either party.

3.
Question 3
Which
provision of the UCC did the court rely on when it determined that a contract
was formed in Textile Unlimited, Inc. v.
A . . BMH and Company (the “Yarn Battle of the Forms” case)? Which
provision determined the terms of the contract?

1 point

A.
The
contract was formed by non-matching acceptance under UCC § 2-207(1) and the
terms were determined under 2-207(2).

B. The contract was formed by conduct under UCC § 2-207(3) and the terms were determined under 2-207(2)

C. The contract was formed by conduct under UCC § 2-207(3) and the terms were determined under the 2-207(3) “knockout rule.”

D. There was no contract.

4.
Question 4
Gadget
Co., a gadget manufacturer, writes a letter to a We Sell Widgets!, a widget
sales company, and offers to buy 3000 widgets for $3.50 each, to be delivered
to Gadget Co. on November 1. The letter includes the line, “Acceptance is
limited to the terms of the offer.”

We Sell Widgets! immediately sends a letter
in reply, saying, “We accept your offer. We will sell you 3000 widgets for
$3.50 each. They will be completed by October 25 and delivered to Gadget Co. on
November 1. AUTOMATIC CANCELLATION: if you do not call us on October 26 to
confirm that you will be able to accept delivery, we will cancel the order and
charge you a $500 cancellation fee.”

Do the companies have a contract? Is WSW’s
automatic cancellation policy part of it?

1 point

A.
There
is a contract. Because Gadget Co. and We Sell Widgets! are merchants, the
automatic cancellation policy is a term of the contract.

B. There is a contract, but the automatic cancellation policy is not a term of the contract.

C. There is no contract.

5.
Question 5
Chet,
who knits for a hobby, offers to sell his friend Michelle a knitted blanket for
$30. Michelle likes Chet’s blankets and would like to buy one, but has had
knitted blankets unravel before. For this reason, she is not willing to buy the
blanket unless Chet provides a warranty. Which of the following letters could
Michelle send to best accomplish her goals?

1 point

A.
“I’ll
buy it. It’s important to me that you provide a three-year warranty that the
blanket will not unravel.”

B. “No thanks.”

C. “I’ll buy it, but only if you are willing to provide a three-year warranty.”

D. Either A or C would have the same effect.

6.
Question 6
Under
Judge Easterbrook’s opinion in the 7th Circuit case, Hill v. Gateway 2000, and Judge Vratil’s opinion in the District of
Kansas case, Klocek v. Gateway, (the
Gateway “Acceptance by Non-Return” cases) when was the contract between Gateway
and the computer buyer formed?

1 point

A.
When
the consumer placed the order over the phone.

B. When Gateway accepted the customer’s order.

C. When the consumer did not return the computer within the time specified by the terms included with the computer.

D. The Hill opinion said the contract was formed when Gateway accepted the customer’s order and the Klocek opinion said the contract was formed when the customer did not timely return the computer.

E. The Klocek opinion said the contract was formed when Gateway accepted the customer’s order and the Hill opinion said the contract was formed when the customer did not timely return the computer.

7.
Question 7
1.
Which
of the following are similarities between the Gateway cases (the “Acceptance by
Non-Return” cases) and Specht v. Netscape
(the “No Clickwrap” case)?

1 point

A. Both involved disputes over whether customers had assented to the terms of an agreement.

B. Both dealt with arbitration agreements.

C. Both involved “clickwrap” agreements.

D. All of the above

E. Both A and B

8.
Question 8
1.
Which
of the following steps could Netscape have taken to increase the likelihood
that a court would rule its customers accepted the agreement at issue in Specht (the “No Clickwrap” case)?

 

1 point

A. Display a pop-up window requiring the consumer to scroll through the agreement and agree with the terms after the user clicks “Begin Download” but before beginning the download.

B. Display a notice of the agreement prominently above the “Begin Download” button.

C. Require the consumer to check a box stating, “I have read and agree to the terms of service,” before clicking the download button.

D. All of the above.

E. Both A and C

9.
Question 9
Jamie
installed a piece of software which displayed a popup with the text of an End
User License Agreement. The software would not install until the user clicked a
button labeled “I Agree.” Which type of agreement is this?

1 point

A. Shrinkwrap

B. Clickwrap

C. Browsewrap

D. None of the above

10.
Question 10
When
do courts tend to enforce clickwrap and browsewrap agreements?

1 point

A. Both are presumptively enforceable.

B. Clickwrap agreements are usually enforceable while browsewrap agreements are usually unenforceable.

C. Browsewrap agreements are usually enforceable while clickwrap agreements are usually unenforceable.

D. Clickwrap agreements are usually enforceable, while browsewrap agreements are usually unenforceable unless highly visible.

E. Both are usually unenforceable.

 

 

week-7 

The Bargain Relationship IV

 

 

1.
Question 1
Fact Pattern for Questions 1 and 2

Based on the court’s reasoning in Drennan (the “Mistaken Bid” case), can Center Contractors insist on Subcontractor A’s performance for the excavating work?

 

1 point

A. Yes. Subcontractor A is bound under a theory of promissory estoppel because it would have reasonably expected that Center Contractors would rely on its bid when bidding for the contract and because Center did rely on A’s bid to its detriment.

B. Yes. Because Center Contractors accepted Subcontractor A’s offer before A withdrew it, there is likely a contract between Center and A.

C. Yes for the reasons stated in both answers A and B.

D. No. By shopping around for better offers, Center terminated its right to accept A’s bid.

2.
Question 2
Based on the scenario in Question 1, Does Subcontractor B have a binding
contract with Center Contractors?

1 point

Yes

No

3.
Question 3
1. Which of the following policy
concerns could justify the holding in Drennan
(the “Mistaken Bid” case)?

1 point

A. It encourages general contractors to investigate whether a subcontractor’s bid is correct even when they have no reason to know or suspect that the subcontractor’s bid was mistaken.

B. If a subcontractor is responsible for its own mistakes, it has an incentive to be careful.

C. If a general contractor has to absorb the costs of a subcontractor’s mistakes, it might increase the costs of construction.

D. Both B and C.

E. None of the above.

4.
Question 4
Simon and Becca are avid board game
players. Becca advertises that she charges a flat rate to teach rules and
strategies for several board games, including one fairly simple, obscure game
called Interstate Adventure (a game where players work as diplomats to
negotiate disputes between states).
Interstate Adventure.

Is there a contract? If so, which game must she teach
Simon?

1 point

A.
There
is a contract to teach the old, simple Interstate Adventure.

B. There is a contract to teach the new, complex Interstate Adventure.

C. There is no contract.

5.
Question 5
Did Raffles v. Wickelhaus (the “Peerless Ships” case) deal with a
misunderstanding or a mistake?

1 point

A.
Misunderstanding

B. Mistake

6.
Question 6
1. Section 20 of the Restatement (2nd)
governs the formation of contracts when there is a misunderstanding as to a
material term of the contract. Section 20(1) deals with the situation where neither
party knows or has reason to know of the other party’s understanding of the
contract, while Section 20(2) deals with the situation where one party knows of
the misunderstanding. What is Section 20(2) an example of?

1 point

A. Placing the costs on the party most able to avoid the misunderstanding.

B. Setting the default against the drafter of the contract.

C. Neither of the above.

7.
Question 7
Does Section 90 of the Restatement
(Second), as interpreted by the Wisconsin Supreme Court in Hoffman v. Red Owl Stores (the “Promised Stores” case), require
that a promise be sufficiently definite to form a binding contract?

1 point

A. Yes. Promissory estoppel merely gets around the lack of consideration.

B. No. Promissory estoppel can allow for pre-contractual liability.

8.
Question 8
Was Hoffman awarded lost profits in
Hoffman v. Red Owl Stores? Why or why
not?

1 point

A. Yes. He was awarded lost profits as part of expectation damages.

B. Yes. He was awarded lost profits as part of reliance damages.

C. No. Lost profits are generally not a form of reliance damages.

D. No. Lost profits are generally not a form of expectation damages.

9.
Question 9
Which of the following best
summarizes the holding in Dixon v. Wells
Fargo (the “Unfulfilled Mortgage Modification” case)?

1 point

A. Promises made in precontractual negotiations can give rise to reliance based liability

B. Promises made in post-contractual negotiations can give rise to reliance based liability

C. Intent in forming a contract determines whether liability is appropriate

D. None of the above.

10.
Question 10
What promise did the court in Dixon hold that the plaintiffs alleged
Wells Fargo had made?

1 point

A. Wells Fargo had not made a promise.

B. To modify the Dixons’ mortgage if the Dixons met certain preconditions.

C. To enter into negotiations to modify the Dixons’ mortgage if the Dixons met certain preconditions.

D. None of the above.

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