Contracts Set 1 - Questions.docx

Immediately after his graduation from college in June, the plaintiff announced his plan to begin law school the following September and to marry his girlfriend in December. The plaintiff’s father was afraid that marriage during the plaintiff’s first year of law school might cause him to fail or dro...

Immediately after his graduation from college in June, the plaintiff announced his plan to begin law school the following September and to marry his girlfriend in December. The plaintiff’s father was afraid that marriage during the plaintiff’s first year of law school might cause him to fail or drop out of school. He called the plaintiff on the phone and said that if the plaintiff postponed his wedding plans until after the completion of his first year of law school, he would give him a cash bonus of $1,000 and would pay the plaintiff’s tuition for the second year of law school. The plaintiff agreed and called his girlfriend to tell her that he wanted to postpone the wedding. She became so angry at him that she broke off their engagement. Two months later, the plaintiff’s girlfriend married someone else. The plaintiff’s father died soon after the plaintiff began school, but the plaintiff successfully completed his first year. Although the plaintiff earned excellent grades, he decided that he was not really interested enough in the law to want to continue his legal education. After failing to register for a second year of law school, he notified his father’s administrator of his decision. The plaintiff said that although there would be no tuition expense, he expected to be paid the $1,000 cash bonus that his father had promised him. The administrator refused to pay anything. If the plaintiff brought suit against the administrator of his father’s estate for $1,000, the plaintiff would probably be unsuccessful, because his contract with his father violated public policy. unsuccessful, because the plaintiff failed to register for a second year of law school. unsuccessful, because the plaintiff’s death terminated his offer. successful. A furniture dealer had 500 barrel chairs for sale. The chairs had a fair market value of $100 each. The manufacturer had discontinued production of the chairs, however, and they were the last ones the dealer had. For that reason, the dealer advertised them at $75 each, even though at that price, her profit would be only $10 per chair. An interior decorator had contracted with the dealer to provide furniture for a new hotel. On May 4, after seeing the barrel chairs advertised, the decorator wired the dealer, “Please ship me 500 barrel chairs as advertised at $75 per chair COD.” On May 5, immediately upon receipt of the telegram, the dealer wired the decorator, “Accept your offer. Will ship 500 barrel chairs tomorrow.” The decorator telephoned the dealer immediately upon receipt of the dealer’s telegram on May 6, saying that, after discussing the chairs with his client, he had decided to cancel the order. On May 7, the dealer sold all the chairs to another buyer at $75 each. If the dealer sued the decorator for breach of contract, the court should award the dealer $5,000 (500 chairs at $10 profit per chair). $37,500 (500 chairs at $75 per chair). $12,500 (fair market value of $100 minus contract price of $75 times 500 chairs). nothing, since the dealer sustained no damage. On March 12, the plaintiff hired the defendant to construct a three-car garage on the plaintiff’s realty. After negotiation, they entered into a valid written contract that fixed the price at $8,000. According to the terms of the contract, the plaintiff was to pay $4,000 when the work was half completed, on or before April 25, and to pay the balance upon completion. All work was to be completed by June 1. On April 10, when the work was one-quarter complete, the partial structure was totally destroyed in a fire that started without fault by either party. The damage done by the fire made it impossible to complete construction on time. Because he was committed to begin construction on a hotel on June 1, the defendant notified the plaintiff on April 12 that he would perform no further work for the plaintiff. The plaintiff subsequently hired another contractor to build the garage at a price of $9,000. The plaintiff instituted an action against the defendant for damages resulting from breach of contract, and the defendant asserted a defense based on impossibility of performance. The court should find for the defendant, because the fire was not his fault. the defendant, because he has not yet received any compensation from the plaintiff. the plaintiff, because the work was only one-quarter complete when fire destroyed the structure. the plaintiff, because the defendant’s obligation was to work for the plaintiff until June 1. The buyer agreed to purchase 250 2” x 4” construction-grade wooden studs from the seller by a written contract that provided that the buyer would make payment prior to inspection. The studs were delivered to the buyer by truck and were covered with a canvas tarpaulin when they arrived at the buyer’s work site. The driver demanded payment before he would unload or uncover the studs. The buyer refused to pay for the studs before inspecting them, and the driver returned them to the seller. If the seller asserts a claim for breach of contract against the buyer, the court should find for the seller, because the buyer’s refusal to pay prior to inspection was a breach. the seller, because the buyer’s refusal to pay prior to inspection was an anticipatory repudiation. the buyer, because the contract provision calling for payment prior to inspection was unconscionable. the buyer, because the seller failed to deliver the studs. A manufacturer of computer hardware and software was seeking a way to speed up the operation of its Basic Computer Program. On March 1, it posted the following notice in the employees’ lounge: The stockholders of this company are offering a cash prize of $200 to any employee who develops a modification of the Basic Computer Program that will double its operating speed. Design modification entries should be submitted to the head of the Basic Program Department prior to June 1. In the event that modifications are submitted by more than one employee, the prize will go to the employee who submits the design which, in the opinion of the Basic Program Department, can be used most economically. An engineer employed by the company read the notice on March 5, and immediately began working on program modifications in his spare time. On March 8, he wrote and signed a memo that said, “I accept the stockholders’ offer of a $200 prize for redesigning the Basic Computer Program. I am hard at work on the project and expect to submit my modification design within a week or two.” The engineer sent the note to the head of the Basic Program Department by the interoffice correspondence system, but it was somehow diverted and was never received by the department head. The notice that was posted on March 1 constituted an offer for a unilateral contract. an offer for a bilateral contract. an offer for a unilateral contract that ripened into a bilateral contract when the engineer wrote the memo on March 8 and deposited it in the interoffice correspondence system. a preliminary invitation to deal, analogous to a newspaper advertisement for the sale of goods. When he moved into a new condo, the owner entered into a written contract with a gardener. Pursuant to its terms, the gardener was to perform certain specified gardening services in the yard of the condo each week for a period of one year, for which the owner was to pay the sum of $50 per month. The contract contained a clause that stated, “The condo owner hereby agrees not to assign this contract without the written permission of the gardener.” Three months after entering into the agreement, the owner informed the gardener that he was selling the condominium to the plaintiff, and asked the gardener to consent to the owner’s assignment of the contract to the plaintiff. Because the costs of landscaping materials had increased dramatically in the last three months, the gardener was glad for an opportunity to be relieved of his obligations under the contract and refused to consent to the assignment. The owner assigned the contract to the plaintiff anyway, but the gardener refused to perform any further work on the yard. After formally demanding performance from the gardener, the plaintiff hired another gardener to do the same work for $75 per month, which was the best price the plaintiff could negotiate. In an action by the plaintiff against the gardener for breach of contract, the court should find for the plaintiff, because the gardener had no right to unreasonably withhold consent to the assignment. the plaintiff, because the assignment was valid in spite of the gardener’s refusal to consent. the gardener, because the contract prohibited assignment by the owner without the gardener’s consent. the gardener, because the contract was for personal services. On June 1, after arson fires had damaged several city buildings, the city council voted to offer a reward to aid in apprehension of the arsonists. On June 2, by order of the city council, signs were posted in various locations throughout the city. The posters identified the buildings that had been burned and stated: “$1,000 REWARD is hereby offered by the city to any person furnishing information leading to the conviction of persons responsible for setting fire to said buildings.” A police officer employed by the city saw the posters on June 5 and resolved to make a special effort to catch the arsonists. Although he was not officially assigned to the case, he notified his fellow police officers and his usual underworld informants that he was especially interested in the case. As a result, another police officer and an underworld informant passed information to the police officer that they thought might relate to the arson crimes. The tip the first police officer received from the other officer proved to be of no assistance, but the tip he received from the informant led him to conduct a further investigation. His efforts eventually resulted in the arrest of two men who pleaded guilty to setting fires in public buildings. The first police officer demanded that the city council pay him $1,000, but the council refused. If the police officer institutes a lawsuit against the city for the $1,000 reward offered in the signs posted on June 2, which of the following would be the city’s most effective argument in defense? The reward should go to the informant, since it was his information that eventually led to the arrest of the arsonists. The reward was not accepted, since the arsonists were not convicted but pleaded guilty. The police officer gave no consideration for the city’s promise to pay a reward, since he was already obligated to attempt the apprehension of the arsonists. There was no enforceable promise by the city, since the offer was for a gratuitous cash award. San Sebastian is an English-speaking republic on the continent of Europe. Its unit of currency is the San Sebastian dollar, which is worth about 85 U.S. cents. While on a business trip in the United States, the plaintiff, who owned a glue factory in San Sebastian, entered into a written contract with the defendant. According to the contract, the defendant was to purchase 30 tons of liquid glue from the plaintiff, to be delivered on or before July 10. The contract stated the total price of the glue to be “NINE THOUSAND ($9,000) DOLLARS.” After receiving the shipment, the defendant sent the plaintiff an international money order for 9,000 San Sebastian dollars. The plaintiff wrote to the defendant, claiming that the agreement called for the payment of 9,000 U.S. dollars, but the defendant refused to make any further payment. The plaintiff instituted an action against the defendant in the United States and offered to testify that, prior to executing the written memorandum, she and the defendant agreed that the price expressed in the writing was to be in U.S. dollars. If the defendant objects to the testimony, the objection should be sustained, since the oral agreement about which the plaintiff is offering to testify was made prior to the execution of the written memorandum of sale. sustained, only if the written memorandum was prepared by the defendant. overruled, unless the writing is found to be a complete integration of the agreement between the defendant and the plaintiff. overruled, because the evidence that the plaintiff is offering to present does not modify or contradict the terms of the writing. The plaintiff was fishing on her boat when she heard a call for help. Looking around, she saw a man drowning and flailing his arms over his head. The plaintiff jumped into the water and swam toward the man, dropping her fishing gear into the lake and losing it in her effort to aid the man. She grabbed the man by the hair and swam to the shore, dragging him out of the water. The man was unconscious, but she gave him mouth-to-mouth resuscitation until he regained consciousness. When the man opened his eyes, he said, “I know I can never repay you for saving my life, but I promise to pay you $100 the first of next month as a token of my gratitude.” A few days later, the man died from causes not related to the incident. The following month, the plaintiff made demand upon the man’s executor for the $100 that the man promised her and for an additional $100, which was the value of the fishing gear that she lost in her attempt to rescue the man. The executor rejected both demands. If the plaintiff institutes an action for the value of her fishing gear against the executor of the man’s estate, the court should find for the plaintiff, on a theory of quantum meruit. the plaintiff, because danger invites rescue. the plaintiff, because the reasonable per son in the man’s position would have offered to pay for the loss of the fishing gear in exchange for the plaintiff’s attempt to rescue him or her. the executor of the man’s estate. A woman’s hobby was restoring and collecting antique automobiles. After acquiring a 1919 Bensonhurst Bullet automobile, she contacted a body shop about having the car repainted. The body shop said that it would paint the Bullet for $700 and would sell the woman a new bumper for an additional $150. Using an order blank from a pad that he purchased at a stationery store, the body shop’s owner wrote out all the terms of the agreement. On a printed line marked “PAYMENT,” he wrote, “Paint job — $700, payable $300 in advance and $400 on completion. Bumper—$150 payable on delivery.” Both the body shop’s owner and the woman signed at the bottom of the form. Which of the following statements most correctly describes the obligations set forth in the writing signed by the woman and the body shop owner? Payment by the woman of the initial $300 is a condition precedent to the body shop’s obligation to paint the car, and the body shop’s painting of the car is a condition precedent to the woman’s obligation to pay the additional $400. Payment by the woman of the initial $300 is a condition precedent in form and substance to the body shop’s obligation to paint the car, and the body shop’s painting of the car is a condition precedent in form, but subsequent in substance to the woman’s obligation to pay the additional $400. Payment by the woman and painting of the car by the body shop are concurrent conditions. Neither party’s obligation to perform is conditioned upon performance by the other party. The plaintiff was employed by the defendant as department manager pursuant to a written contract. The contract was for a five-year term and fixed the plaintiff’s compensation at $2,000 per month. The plaintiff’s work was satisfactory, but two years after entering into the contract with him, the defendant reorganized the company. As a result of the reorganization, the plaintiff’s department was eliminated, and the defendant terminated the plaintiff’s employment. The plaintiff advertised in the “jobs wanted” section of the newspaper, but he did not find a job until six months after his discharge, when he went to work for another company doing the same general sort of work that he had been doing for the defendant and earning the same salary. In an action by the plaintiff against the defendant for damages resulting from breach of the employment contract, the court should give judgment to the defendant, since the plaintiff’s position was eliminated. the plaintiff, for severance pay in a sum equivalent to two months’ salary. the plaintiff, in a sum equivalent to the salary that the plaintiff lost between the time of his discharge and the time he began working for the new company, plus the cost of advertising in the “jobs wanted” section of the newspaper. the plaintiff, in a sum equivalent to the salary that the plaintiff would have received during the balance of the contract term. The plaintiff was the owner of a fleet of taxis that he leased to independent drivers in return for 60 percent of the fares that they collected. All the leases were scheduled to expire on December 31. Because the cars in his fleet were beginning to look shabby, the plaintiff decided to have them all painted during the first week of January, before negotiating new leases with the drivers. At the beginning of December, he called the defendant’s auto- painting company to inquire about his price for painting all the cars in the plaintiff’s fleet. The defendant said he would do the job for $150 per car. The plaintiff said, “I’m talking about 60 cars. That’s a lot of business. I’ll give you the job if you’ll do it for $125 per car.” “I’d really like to have your business,” replied the defendant. “See you the first week in January,” the plaintiff said. On January 3, the plaintiff brought one of his taxis to the paint shop and offered to make arrangements for bringing in the rest of the cars to be painted. The defendant said that he had just obtained a contract to paint some school buses and that he was too busy to do any work for the plaintiff. The plaintiff subsequently asserted a claim for damages against the defendant. Which of the following additional facts or inferences, if it were the only one true, would be most helpful to the plaintiff in his action against the defendant? The defendant’s statement, “I’d really like to have your business,” implied a promise to paint all the cars in the plaintiff’s fleet at $125 per car. The plaintiff relied on the defendant’s statement by bringing the taxi to the shop. Immediately prior to January 3, the plain tiff could have had the taxis painted at another shop for $125 each, but immediately after January 3, the lowest price he could find was $150. On January 3, when the defendant told the plaintiff that he was too busy to do the work, the plaintiff offered to pay the defendant $150 per car and tendered payment of that sum. When the plaintiff’s uncle died, he left her a 10-story office building that had a motion picture theater on its ground floor. The offices in the building were all occupied when the plaintiff acquired title to it. The motion picture theater was vacant, however, so she advertised for a tenant. The defendant had researched the neighborhood and decided that it was a good location for a pornographic movie theater. When he saw the plaintiff’s advertisement, he contacted her and said that he was interested in leasing the theater. He did not tell her what type of films he intended to show because he thought that she might be unwilling to rent it to him for that purpose. On April 1, they entered into a written rental agreement for the theater, occupancy to begin on May 1. On April 15, the city council passed an ordinance prohibiting the showing of pornographic films in the neighborhood where the theater was located. As a result, the defendant advised the plaintiff that he was canceling the rental agreement. If the plaintiff sues the defendant for breach of contract, the court should find for the defendant, under the doctrine of frustration of purpose. the defendant, under the doctrine of impossibility of performance. the defendant, because after the contract had been formed, government action made its subject matter unlawful. the plaintiff. A builder contracted to add a room to a homeowner’s house for $3,000, with the understanding that the materials used by the builder were to be included in that price. The day before work was to begin, the homeowner wired the builder, “The deal is off. Do not begin work.” The builder subsequently asserted a claim against the homeowner for breach of contract. The homeowner raised non-compliance with the Statute of Frauds as a defense. Which of the following statements is most correct about the application of the Statute of Frauds to the contract between the homeowner and the builder? The contract was required to be in writing if the materials that would have been required had a price in excess of $500. The contract was required to be in writing if, at the time of contracting, the parties intended that the materials required would have a price in excess of $500. The contract was required to be in writing if the materials that would have been required had a price in excess of $500, and the parties intended that the materials required would have a price in excess of $500 at the time of contracting. The contract was not required to be in writing. After the plaintiff said that the defendant owed him $3,000, the defendant promised to pay $2,000, which the plaintiff agreed to accept as payment in full. Subsequently, the defendant refused to make payment, and the plaintiff asserted a claim for $2,000 based on the defendant’s promise. If it was the only one true at the time of the defendant’s promise, which of the following additional facts or inferences would be most likely to result in a judgment for the plaintiff? The defendant honestly believed that he owed the plaintiff $3,000, but the plaintiff did not believe that the defendant owed him the money. The plaintiff honestly believed that the defendant owed him $3,000, but the defendant did not believe that he owed the plaintiff the money. The plaintiff was threatening to institute a lawsuit against the defendant for $3,000 plus costs and interest. The plaintiff had already commenced a lawsuit against the defendant for $3,000 plus costs and interest. A building contractor’s daughter was about to celebrate her 21st birthday, and the contractor wanted to give her a gift that would express his sentiments for her. He was a wealthy and successful contractor, but he had begun his career as an assistant bricklayer. Instead of purchasing something for his daughter, he decided to give her a gift with the labor of his hands. The contractor entered into a written contract with the defendant. According to its terms, the contractor agreed to build a brick fireplace for the defendant, performing all the labor himself. In return, the defendant agreed to pay the sum of $1,000 to the contractor’s daughter on her birthday, February 12, upon completion of the work by the contractor to the defendant’s satisfaction. The daughter did not learn of the transaction until February 12. Before signing the written contract, the defendant and the contractor agreed orally that the defendant would make a reasonable effort to obtain a loan to pay for the work, but that if the defendant was unsuccessful in doing so by January 1, the agreement between them would be of no effect. The defendant made efforts to obtain the loan but could not do so. On January 1, the defendant informed the contractor that because he was unable to obtain the loan, he was calling off the deal. In an action for breach of contract brought against the defendant by the proper party, will the defendant be successful in asserting as a defense his inability to obtain a loan? Yes, because obtaining a loan was a condition precedent to the existence of an enforceable contract. Yes, because a modification of a construction contract may be by oral agreement. No, because the defendant is estopped from denying the validity of the written agreement. No, because the agreement concerning the loan is an oral agreement that was made prior to the writing and it contradicts the terms of the writing. Assume that the defendant in each of the following fact patterns objects to enforcement of the agreement on the ground that it violates the Statute of Frauds. In which of the following fact patterns is the agreement between the plaintiff and the defendant LEAST likely to be enforced over the defendant’s objection? The defendant orally agreed to purchase a series of porcelain figurines from the plaintiff to be delivered one per week for 15 weeks at a price of $100 per figurine. Prior to the first delivery, the defendant advised the plaintiff that he was no longer interested in receiving the figurines. The defendant orally agreed to purchase a hand-carved entry door for the defendant’s home with the defendant’s coat of arms on it for a price of $600. After the plaintiff completed the rough carving of the defendant’s coat of arms, the defendant changed her mind and notified the plaintiff that she would not accept delivery of the door. The defendant’s pleadings admitted making an oral agreement to purchase a painting from the plaintiff for $900 but asserted as an affirmative defense that the agreement was unenforceable under the Statute of Frauds. The defendant orally agreed to a price of $1,200 for the purchase of 100 lawn- trimmers manufactured by the plaintiff for resale in the defendant’s store. The plaintiff then sent the defendant a memorandum signed by the plaintiff and outlining the terms of their agreement. The defendant did not sign the memorandum or respond to it in any way. The plaintiff, a minor, purchased a used car from the defendant for $1,200. The reasonable rental value of the car was $150 per month. After she had owned the car for two months, the steering failed while she was driving it, causing it to collide with a tree. Although the plaintiff was unhurt, the car sustained $400 worth of damage. The plaintiff returned the damaged car to the defendant and demanded her money back, but the defendant refused to refund her money. If the plaintiff asserts a claim against the defendant, the court should award her a judgment in the amount of $1,200 (the full purchase price of the car). $900 (the purchase price of the car less its reasonable rental value). $800 (the purchase price of the car less the damage that it sustained). nothing. The seller and the buyer were neighbors who owned homes on adjoining parcels of realty. They were both in the business of selling art supplies, each operating an art supply store that engaged in friendly competition with the other. The seller owned a garden tractor that he used for cultivating vegetables in the backyard of his home. The buyer, who wanted to plant a garden in his own backyard, sent the seller a note in which he offered to buy the tractor from the seller for $500. The seller responded on February 15 by sending the buyer a letter that stated, “I will sell you my garden tractor for $600, and not a penny less. To give you time to think it over, I promise to hold this offer open until March 15.” On March 5, the buyer noticed a similar garden tractor in the yard of another neighbor. He called that neighbor on the phone and offered to buy it for $500, but he said, “Are you kidding? I just bought it from [the seller] for $600.” On March 6, the buyer went to the seller’s store with $600 in cash, and said, “I’ve decided to buy that tractor from you. Here’s the money.” The seller refused the money and told the buyer that he had already sold the tractor to the other neighbor. If the buyer asserts a claim against the seller for damages resulting from the seller’s refusal to sell the tractor on March 6, the court should find for the buyer, because the seller’s offer of February 15 was irrevocable until March 15. the buyer, because the seller did not notify him that he was withdrawing his offer to sell the buyer the garden tractor until after the buyer accepted it. the seller, because the buyer learned of the sale to the other neighbor on March 5. the seller, because his letter of February 15 was a rejection of the buyer’s original offer to purchase the garden tractor. The seller and the buyer entered into a written contract for the sale of 200 electric power drills. Although they orally agreed on a price, they inadvertently failed to include it among the terms of the written agreement. In an action for breach of the contract, the court should admit oral testimony to establish the price that the parties intended. refuse to enforce the contract if it is one that the Statute of Frauds required to be in writing. conclude that the contract calls for the payment of a reasonable price. disregard the writing since it fails to contain all the essential terms of the agreement. On May 15, after negotiation, a painter and a homeowner entered into a written agreement for the painting of the homeowner’s home. The writing stated that the price was to be $300 plus the cost of materials, that the work was to begin on June 2 and be completed by June 12, that stucco portions of the house were to be painted yellow and wood trim was to be painted brown, and that the written memorandum was a full and final expression of the agreement between the painter and the homeowner. During litigation between the painter and the homeowner to enforce the contract, the homeowner offered to testify to the following additional facts. Which is the LEAST likely to be admitted into evidence over timely objection by the painter? Prior to signing the memorandum, the painter and the homeowner orally agreed that the contract would have no legal effect if the homeowner sold his house prior to June 2. Prior to signing the memorandum, the painter and the homeowner orally agreed that the homeowner would use no paint without first submitting it for the homeowner’s approval. While signing the memorandum, the painter and the homeowner orally agreed that any promises made by either of them during negotiations were to be enforceable, even if they were omitted from the memorandum. While signing the memorandum, the painter and the homeowner orally agreed that the painter would spend no more than $10 per gallon for paint. On May 20, on a form provided by an air- conditioning company, the defendant agreed to purchase from the company 100 described air-conditioning units at a price of $250 each, FOB the company’s factory. The contract contained a clause that prohibited either party from assigning its rights or obligations under the contract without the consent of the other party. On June 1, the company’s employees loaded the units on a truck owned and operated by an independent trucking company. When the loading was complete, the air- conditioning company phoned the defendant that the shipment was on its way. Later that day, the company executed a document that contained the following language: “In consideration of $20,000 to me in hand paid by the plaintiff this date, I hereby assign to the plaintiff all rights under my contract with the defendant dated May 20.” On June 2, while en route to the defendant’s warehouse, the truck containing the air-conditioning units overturned, and the entire shipment was destroyed. The defendant did not consent to the company’s assignment of rights to the plaintiff. In an action by the plaintiff against the defendant, the plaintiff will probably recover the contract price of $25,000 (100 air-conditioning units at $250 each). the difference between the contract price and the market value of the air- conditioning units. nothing, since recovery from the defendant would unjustly enrich the plaintiff. nothing, since the contract between the defendant and the plaintiff prohibited assignment. A world-renowned artist’s will left a collection of 30 of his paintings to his niece, an art dealer. The paintings inherited by the niece were untitled, but they were identified by the numbers 1 through 30. The niece had a catalog printed containing photographs and descriptions of each painting in the collection. On August 1, she sent a copy of the catalog to another art dealer, with the following cover letter: I know how much you like my uncle’s work, so I’m giving you an opportunity to buy some of these paintings before I offer them to any other dealers. The price is $2,000 per painting, no matter how many you buy. Telegraph your order within two weeks, or I’ll put them on the market. (signed) On August 2, the art dealer sent the niece a telegram that said, “I accept your offer to sell painting Number 30 for $2,000. I will come to your gallery in two days to pick up the painting, and will pay cash at that time.” On August 3, after receiving the telegram, the niece telephoned the dealer and said that because of favorable publicity that the collection had received, she would not sell painting Number 30 for less than $3,000. The dealer agreed on the telephone to pay $3,000 for painting Number 30. On August 4, the dealer sent and the niece received a telegram that said, “I accept your offer to sell your uncle’s paintings 1 through 29 for $2,000 each. I will pick up the paintings tomorrow, and will pay for them at that time. “ On August 5, the dealer presented herself at the niece’s gallery and tendered payment of $2,000 each for all 30 paintings. However, the niece refused to sell her any of the paintings except Number 30, for which the niece insisted the agreed price was $3,000. The dealer left without buying it, saying that the niece would be hearing from her lawyer. If the niece asserts a claim against the dealer for breach of a contract to purchase painting Number 30 for $3,000, the court should find for the dealer, because her promise to pay $3,000 for the painting was not in writing. the dealer, unless the fair market value of painting Number 30 increased by $1,000 between August 1 and August 3. the niece, because she relied on the dealer’s promise to pay $3,000 for painting Number 30. the niece, because she had not received payment from the dealer prior to their conversation on August 3. On March 1, an aluminum siding contractor entered into a written contract with the home-owner for the installation of aluminum siding on the exterior of the homeowner’s home. The contract called for completion of the job by April 1 and contained a clause that prohibited assignment by either party without the other party’s written consent. The contractor started work immediately upon the signing of the contract. On March 15, the homeowner sold his house, assigning to the new owner his contract with the contractor. In which of the following fact situations is the plaintiff LEAST likely to succeed in his action against the defendant? The contractor finished the job in a work manlike manner on March 29 and demanded but did not receive payment. The contractor instituted an action against the original homeowner for payment. The contractor finished the job in a work manlike manner on March 29 and demanded but did not receive payment. The contractor instituted an action against the new owner for payment. When the contractor learned of the home owner’s assignment to the new owner, he refused to do any further work. The original homeowner instituted an action against the contractor for breach of contract on April 15. When the contractor learned of the original homeowner’s assignment to the new owner, he refused to do any further work. The new owner instituted an action against the contractor for breach of contract on April 15. On August 1, a wholesaler of office supplies contracted by telephone to sell 50 cases of typewriter ribbons to a business equipment retailer at a total price of $450. On August 15, the wholesaler telephoned the retailer and told him that because of a shortage of materials, the price that the wholesaler had to pay for typewriter ribbons had increased drastically. The wholesaler said that if he delivered the ribbons at the price of $450, he would lose a great deal of money. He asked the retailer to consent to a higher price, suggesting that the retailer pass the increase along to his customers. After further discussion, the retailer and the wholesaler agreed to change the price of the order from $450 to $650. On August 18, the retailer succeeded in purchasing 50 cases of typewriter ribbons from another supplier for $500. On September 1, the wholesaler delivered 50 cases of typewriter ribbons to the retailer, together with a bill for $650. The retailer rejected the delivery. In an action by the wholesaler against the retailer for breach of contract, which of the following would be the retailer’s most effective argument in defense? The wholesaler’s demand for more money was unconscionable, since typewriter ribbons were available at a lower price. The August 15 agreement increasing the price was not in writing. The retailer’s promise to pay $650 was unsupported by consideration. An increase in the wholesaler’s cost resulting from a shortage of materials was foreseeable on August 1. The seller was an importer of arts and crafts products from Mediterranean countries, selling mainly to large department stores and import shops. To keep his sales force down to a minimum, the seller did most of his selling by sending catalogs describing products and prices to prospective customers and taking orders by mail on forms provided with the catalogs. The phrase “10 percent discount on COD orders only” appeared on the order form and on each page of the catalog. After receiving one of the seller’s catalogs, the buyer decided to order 1,000 Greek coffeepots for sale in her import shop. On April 25, she typed the following across the seller’s order form: “Send immediately 1,000 Greek coffeepots (Catalog #6047) at 10 percent discount. Payment within 10 days of receipt and acceptance.” The seller received the order on April 27. On April 28, the seller shipped 1,000 Greek coffeepots to the buyer, who received and accepted them on May 2. On April 29, the seller wrote to the buyer, “I am shipping pursuant to your request and will expect payment within 10 days. Since discounts apply only to COD shipments, you are herewith billed at full price.” The buyer received the letter and enclosed bill on May 3. On May 4, the buyer sent the seller a check in payment of the amount billed, less 10 percent. When was a contract for sale of the coffeepots formed? On April 25, when the buyer sent the order to the seller. On April 27, when the seller received the order from the buyer. On April 28, when the seller shipped the coffeepots to the buyer. On May 2, when the buyer received the shipment of coffeepots. After lengthy negotiations, the plaintiff purchased a car from the defendant, a car dealer. The plaintiff was driving it the following day when the brakes failed due to a defect that existed at the time the defendant delivered the car to the plaintiff. As a result, the car collided with a pole and was damaged. The plaintiff asserted a claim against the defendant for damages resulting from breach of the implied warranty of merchantability. Which one of the following additional facts, if it were the only one true, would be most likely to result in a judgment for the defendant? At the time of the sale, both the defendant and the plaintiff signed a document stating that the car was being sold “as is.” The car that the plaintiff bought from the defendant was a used car. The defect that caused the brakes to fail could not have been discovered by reasonable inspection prior to the sale. The plaintiff purchased the car in reliance on the advice of a mechanic whom she hired to inspect it prior to making the purchase. The defendant, who broke his leg falling from a ladder, was treated by a doctor. At the time treatment began, the defendant explained that he was short of cash, but that his treatment was covered by group insurance. The doctor agreed to wait for his fee until the insurance company made payment and offered to bill the insurance company directly for the services that he rendered to the defendant. The defendant provided the doctor with claim forms from the company that insured the defendant’s union. The doctor filled out the form, had the defendant sign a portion of it authorizing the insurance company to make payment directly to the doctor, and submitted the form to the company. Because of an error by employees of the insurance company, the payment was sent to the defendant, who failed to make any payment at all to the doctor. If the doctor asserts a claim against the defendant to recover the amount of the unpaid bill, the court will probably find for the doctor, because he is a creditor third-party beneficiary of the group insurance policy that covered the defendant. the doctor, because the defendant impliedly promised to pay the doctor for his services. the defendant, because the doctor agreed to accept payment from the insurance company. the defendant, because the doctor billed the insurance company directly. A landowner wanted to open an amusement park on a parcel of real estate that he owned. After negotiation, the landowner hired a contractor to build a roller coaster and several other amusement devices on the land according to specifications furnished by the landowner. The landowner and the contractor entered into a written contract by which the contractor agreed to begin construction on August 1, to be finished with everything but the roller coaster by November 1, and to complete construction of the roller coaster by December 15. The contract price was $150,000, to be paid as follows: $50,000 on August 1, $50,000 upon completion of everything but the roller coaster, and the balance of $50,000 upon completion of the roller coaster. The contractor began work on August 1, after receiving $50,000 from the landowner. By November 1, the contractor completed construction of everything but the roller coaster in accordance with the specifications. On November 1, the contractor demanded the landowner pay him $50,000, but the landowner refused to do so. Which of the following statements is most correct concerning the rights of the contractor? The contractor is entitled to damages limited to the sum of $50,000. The contractor is entitled to damages in the sum of $100,000. The contractor may refuse to perform any further work without incurring liability for breach of contract. The contractor may not sue the land owner for breach of contract until he completes construction of the roller coaster. A landowner was suffering from a terminal disease and did not expect to live much longer. She was the owner of a parcel of realty known as Blackacre and wanted her son to have it. Blackacre was worth $500,000, but it was subject to a non-assumable mortgage securing a note with a balance of $100,000. For this reason, the landowner offered to sell Blackacre to her son for $100,000. Her son said that he would like to buy it, but that it would take him a while to raise the money. Fearful that she would die before the transaction could be completed and that her administratrix would be unwilling to sell the realty to her son for that price, the landowner wrote and signed a document that said, “In consideration of $20 paid to me by my son, I hereby promise to convey my realty known as Blackacre to him for the sum of $100,000 if he pays the entire purchase price within one month.” Two days later, the landowner died. One week after that, her son tendered the sum of $100,000 to the administratrix of the landowner’s estate, demanding that she convey Blackacre to him, but the administratrix refused. If the son instituted a proceeding against the landowner’s administratrix for an order directing her to sell Blackacre to him for $100,000, the court should find for the son, because the document written and signed by the landowner was a valid option contract. the son, because the document written and signed by the landowner was intended to be a testamentary substitute. the landowner’s administratrix, because $20 is not sufficient consideration for a $100,000 option. the landowner’s administratrix, because $100,000 is not sufficient consideration for realty valued at $500,000.