Test Bank Chapter 11 Written Contracts and Cyber-Commerce

Business Law with UCC Applications, 15e (Sukys)

Chapter 11 Written Contracts and Cyber-Commerce

1) In the Opening Case Round 1, Sole Survivor claimed it could vacate Eastland Mall because it had been constructively evicted.

Difficulty: 1 Easy

Topic: The Statute of Frauds

Learning Objective: 11-01 Identify the goals of the Statute of Frauds.

Bloom's: Remember

AACSB: Reflective Thinking

Accessibility: Keyboard Navigation

2) If the terms of a contract make it unlikely that the contract can be completed within one year, the contract must be in writing to be enforceable under the Statute of Frauds.

Difficulty: 2 Medium

Topic: The Statute of Frauds

Learning Objective: 11-02 Identify those contracts that must be in writing.

Bloom's: Understand

AACSB: Reflective Thinking

Accessibility: Keyboard Navigation

3) Sean gives an oral promise to Oscar to buy Oscar's old house, but only offers to keep the promise enforceable for 30 days. Oscar, relying on Sean's promise, puts on a new roof and paints it. Twenty days later, Sean changes his mind and says he's no longer interested. Oscar can enforce Sean's promise.

Difficulty: 3 Hard

Topic: The Statute of Frauds

Learning Objective: 11-02 Identify those contracts that must be in writing.

Bloom's: Apply

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

4) Responding to a Craigslist ad, Jennifer, who is a wholesaler of furniture, leaves a voicemail for James, a small custom-made furniture maker, offering to purchase his custom made king-size oak bed frame for $650, even though it was advertised at $1,150. James does not respond. Jennifer has an enforceable contract.

Difficulty: 3 Hard

Topic: The Statute of Frauds

Learning Objective: 11-02 Identify those contracts that must be in writing.

Bloom's: Apply

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

5) The administrator of an estate is a person named by the court, if none is named in a will.

Difficulty: 2 Medium

Topic: The Statute of Frauds

Learning Objective: 11-02 Identify those contracts that must be in writing.

Bloom's: Understand

AACSB: Reflective Thinking

Accessibility: Keyboard Navigation

6) When a personal gain to the guarantor is involved, the primary objective test requires that promise to be in writing for the contract to be enforceable.

Difficulty: 1 Easy

Topic: The Statute of Frauds

Learning Objective: 11-02 Identify those contracts that must be in writing.

Bloom's: Remember

AACSB: Reflective Thinking

Accessibility: Keyboard Navigation

7) The main purpose construction rule is the most fundamental guideline for the interpretation of written contracts.

Difficulty: 2 Medium

Topic: Legal Rules for Written Contracts

Learning Objective: 11-04 Explain the Standard Construction Rule.

Bloom's: Understand

AACSB: Reflective Thinking

Accessibility: Keyboard Navigation

8) Under the best evidence rule, evidence of oral statements made before signing a written agreement is admissible in court to change the terms of a written agreement.

Difficulty: 2 Medium

Topic: Legal Rules for Written Contracts

Learning Objective: 11-05 Discuss the Parol Evidence Rule.

Bloom's: Understand

AACSB: Reflective Thinking

Accessibility: Keyboard Navigation

9) Under the equal dignities rule, oral evidence cannot be used to clarify terms that are obscure in a written contract.

Difficulty: 2 Medium

Topic: Legal Rules for Written Contracts

Learning Objective: 11-06 Explain the exceptions to the Parol Evidence Rule.

Bloom's: Understand

AACSB: Reflective Thinking

Accessibility: Keyboard Navigation

10) Charles only has a photocopy of his written contract with Jenny, and not the original. Under the best evidence rule, since Charles only has a photocopy, it is the 'best evidence' the court can accept in his trial.

Difficulty: 3 Hard

Topic: Legal Rules for Written Contracts

Learning Objective: 11-07 Explain the Best Evidence Rule.

Bloom's: Apply

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

11) Judson Law Firm agrees to hire Francisco after he passes the Texas bar exam. The offer has a concurrent condition. The "as is" offer is an enforceable contract.

Difficulty: 2 Medium

Topic: Legal Rules for Written Contracts

Learning Objective: 11-08 Discuss the Equal Dignities Rule.

Bloom's: Understand

AACSB: Reflective Thinking

Accessibility: Keyboard Navigation

12) Jane (seller) and Joe (buyer) enter into an oral contract for the sale of land. Joe begins to add significant improvements to the land and house and outbuildings. Jane changes her mind and revokes the sales contract. According to the Statute of Frauds, the contract between Jane and Joe is enforceable because of equitable estoppel.

Difficulty: 2 Medium

Topic: Formalities of Construction

Learning Objective: 11-08 Discuss the Equal Dignities Rule.

Bloom's: Understand

AACSB: Reflective Thinking

Accessibility: Keyboard Navigation

13) Under contract law, facsimile signatures are always as valid as original signatures.

Difficulty: 2 Medium

Topic: Formalities of Construction

Learning Objective: 11-08 Discuss the Equal Dignities Rule.

Bloom's: Understand

AACSB: Reflective Thinking

Accessibility: Keyboard Navigation

14) Alice uses an electronic "shopping cart" on a popular website to purchase many items. When she clicks "Checkout" she is creating an enforceable contract called a 'click-on agreement.'

Difficulty: 3 Hard

Topic: Formalities of Construction

Learning Objective: 11-08 Discuss the Equal Dignities Rule.

Bloom's: Apply

AACSB: Reflective Thinking

Accessibility: Keyboard Navigation

15) A notary is not required to read the document when providing acknowledgment of a signature.

Difficulty: 2 Medium

Topic: Formalities of Construction

Learning Objective: 11-08 Discuss the Equal Dignities Rule.

Bloom's: Understand

AACSB: Reflective Thinking

Accessibility: Keyboard Navigation

16) The provisions of Article 2 of the Uniform Commercial Code apply when a cyber-agreement deals with the sale of goods.

Difficulty: 2 Medium

Topic: Cyber-Commerce and the Law

Learning Objective: 11-09 Explain the problems associated with cyber-commerce.

Bloom's: Understand

AACSB: Reflective Thinking

Accessibility: Keyboard Navigation

17) The standard construction rule directs the court to determine the principal objective of the parties in the making of the contract.

Difficulty: 2 Medium

Topic: Cyber-Commerce and the Law

Learning Objective: 11-10 Outline the latest cyber-commerce statutes.

Bloom's: Understand

AACSB: Reflective Thinking

Accessibility: Keyboard Navigation

18) Courts have held that terms hidden behind a blue "hyperlink" are roughly analogous to the pages of a long and drawn-out multipage paper contract.

Difficulty: 2 Medium

Topic: Cyber-Commerce and the Law

Learning Objective: 11-09 Explain the problems associated with cyber-commerce.

Bloom's: Understand

AACSB: Reflective Thinking

Accessibility: Keyboard Navigation

19) The Fair and Accurate Credit Transactions Act (FACT Act) attempts to address the identity theft epidemic.

Difficulty: 2 Medium

Topic: Cyber-Commerce and the Law

Learning Objective: 11-10 Outline the latest cyber-commerce statutes.

Bloom's: Understand

AACSB: Reflective Thinking

Accessibility: Keyboard Navigation

20) Oral contracts for the sale of goods of $500 or more will be enforced in situations involving admissions in court.

Difficulty: 2 Medium

Topic: Cyber-Commerce and the Law

Learning Objective: 11-09 Explain the problems associated with cyber-commerce.

Bloom's: Understand

AACSB: Reflective Thinking

Accessibility: Keyboard Navigation

21) The Statute of Frauds: ________.

A) states that all contracts have to be in writing to be enforceable in the court of law

B) decrees oral contracts to be invalid and hence not upheld or enforceable by law

C) states that certain types of contracts have to be in writing to be enforceable

D) maintains that agreements can be oral while contracts have to be in the written format

Difficulty: 2 Medium

Topic: The Statute of Frauds

Learning Objective: 11-01 Identify the goals of the Statute of Frauds.

Bloom's: Understand

AACSB: Reflective Thinking

Accessibility: Keyboard Navigation

22) Star Software Systems and Henry orally agree for Henry to write special accounting software. This software usually takes three years to complete, but can be done sooner. Does Henry have an enforceable legal agreement with Star?

A) Yes, the agreement is enforceable because Henry could possibly complete writing the software within a year.

B) No, the agreement is unenforceable because it is not written and signed.

C) Yes, the agreement is enforceable, but only to the extent of work Henry completes within the first year of the contract.

D) No, the agreement is unenforceable since the contract involves a tangible work product.

Difficulty: 3 Hard

Topic: The Statute of Frauds

Learning Objective: 11-02 Identify those contracts that must be in writing.

Bloom's: Analyze

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

23) Donna entered into an oral contract with Ava to purchase a house from Ava, with $500 per month payments for the next 10 years. Donna moved into the house, remodeled it, and did extensive repairs. At the end of 10 years, Ava refused to convey title to the house to Donna and produced evidence at the resulting trial that the fair market rental value for the house averaged $800 per month over the 10-year period. Does Donna have an enforceable contract?

A) Yes, Donna is entitled to the ownership of the house because oral contracts for the sale of land are enforceable under the Statute of Frauds.

B) No, Donna cannot claim ownership of the house since there was no written contract with Ava.

C) Yes, Donna can claim ownership of the house based on equitable estoppel.

D) No, Donna is not entitled to the ownership of the house since she was paying below the fair value.

Difficulty: 3 Hard

Topic: The Statute of Frauds

Learning Objective: 11-02 Identify those contracts that must be in writing.

Bloom's: Analyze

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

24) Uncle Rodrick was deeply in debt when he died. His niece, Evangeline, became the administrator of his estate. She orally promised Rodrick's creditors that she would personally pay his debts if they would not publicize the fact that Rodrick died in debt. When Evangeline was unable to pay the debts, the creditors sued her. Will the creditors be legally able to collect from Evangeline?

A) Yes, since there was a bargained-for exchange.

B) No, since Evangeline was not Rodrick's child.

C) Yes, since Evangeline made a guaranty of payment.

D) No, since Evangeline's promise was not in writing and signed.

Difficulty: 3 Hard

Topic: The Statute of Frauds

Learning Objective: 11-02 Identify those contracts that must be in writing.

Bloom's: Analyze

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

25) Sagan is borrowing money from Big Bank. His friend Leda, who works for Graille Systems, signs the loan agreement promising to pay the debt if Sagan does not. In this scenario, ________ is the obligee, and ________ obligor.

A) Sagan, Big Bank

B) Leda, Big Bank

C) Graille Systems, Sagan

D) Big Bank, Sagan

Difficulty: 3 Hard

Topic: The Statute of Frauds

Learning Objective: 11-02 Identify those contracts that must be in writing.

Bloom's: Analyze

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

26) Gabriel applies for a home loan. Mark signs the agreement promising to pay off the debt in case Gabriel fails to do so. In this case Mark is:

A) the guarantor.

B) the obligee.

C) the obligor.

D) the assignor.

Difficulty: 3 Hard

Topic: The Statute of Frauds

Learning Objective: 11-02 Identify those contracts that must be in writing.

Bloom's: Analyze

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

27) Matrix, Inc. is the general contractor of a large commercial building project. Matrix subcontracted with Acme Flooring, Inc. to have flooring installed throughout the building. When Matrix failed to make payments to Acme as agreed, Acme stopped working. Commercial Bank, the lender for the project, orally promised Acme that Commercial would pay whatever Matrix failed to pay Acme if Acme would resume work. Acme finished the flooring, but was still not paid. Which of the following is true under the Statute of Frauds?

A) According to the primary objective test, Commercial Bank is not obliged to pay Acme as the promise must be written and signed.

B) According to the primary objective test, since Commercial Bank's promise enhanced its mortgage interest, it is liable for payment to Acme.

C) According to the main purpose test, Commercial Bank is not obliged to pay to Acme since Matrix was not a party to its promise.

D) According to the primary objective test, since Commercial Bank's promise did not involve the actual lending of money, it is not liable to Acme.

Difficulty: 3 Hard

Topic: The Statute of Frauds

Learning Objective: 11-02 Identify those contracts that must be in writing.

Bloom's: Evaluate

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

28) ________ contracts for the sale of goods of $500 or more are ________ if the contract ________.

A) Oral, enforceable, involves specially manufactured goods that cannot be resold easily

B) Oral, not enforceable, is an executed agreement

C) Written, not enforceable, involves admissions in court

D) Electronic, not enforceable, is a written memorandum

Difficulty: 2 Medium

Topic: The Statute of Frauds

Learning Objective: 11-02 Identify those contracts that must be in writing.

Bloom's: Understand

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

29) Charles orally promises Holly that he will marry her. He also states that if they ever get divorced, then he will transfer one-half of his assets to Holly. They marry and divorce within a year. Which of the following is true of Charles's promise to Holly?

A) The promise qualifies as an enforceable oral contract.

B) The promise is legally enforceable only if it does not involve the transfer of land.

C) The promise is not legally enforceable unless Holly proves that the promise influenced her decision to marry him.

D) The promise is not legally enforceable because it was not written.

Difficulty: 3 Hard

Topic: The Statute of Frauds

Learning Objective: 11-02 Identify those contracts that must be in writing.

Bloom's: Analyze

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

30) Which of the following contains all the elements of a written agreement that can be enforceable under law?

A) "Henry Shay agrees to purchase hand-knit sweaters for $45 apiece. Signed, Henry Shay."

B) "Silvie Nader and Henry Shay are parties involved in this contract for the purchase of hand-knit sweaters on Wednesday, June 17. Signed, Henry Shay and Silvie Nader."

C) "Silvie agrees to mail six hand-knit sweaters, at $45 apiece, to the house on Wednesday, June 17. Signed, Silvie Nader."

D) "Full Agreement by Henry Shay and Silvie Nader. Henry agrees to purchase from Silvie six of Silvie's hand-knit sweaters at $45 each. Signed, Silvie Nader, and Henry Shay."

Difficulty: 3 Hard

Topic: The Statute of Frauds

Learning Objective: 11-03 List the information that must be in the writing.

Bloom's: Apply

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

31) According to the ________, whenever an ambiguous term, clause, or line is found in a prewritten contract, that ambiguity is interpreted against the party who wrote the contract.

A) standard construction rule

B) parol evidence rule

C) best evidence rule

D) equal dignities rule

Difficulty: 2 Medium

Topic: Legal Rules for Written Contracts

Learning Objective: 11-04 Explain the Standard Construction Rule.

Bloom's: Understand

AACSB: Reflective Thinking

Accessibility: Keyboard Navigation

32) Catherine and Jacob have a written contract to buy and sell "100 cases of widgets." The 100 cases is a typo, so after signing the contract they orally agree to modify the contract to "1,000 cases of widgets." If later the parties are in litigation concerning the amount of widgets involved in the contract, can evidence of the oral change be introduced into evidence?

A) No, since this violates the parol evidence rule.

B) Yes, since both signed the original contract.

C) Yes, since this is an exception to the parol evidence rule.

D) No, since this violates the best evidence rule.

Difficulty: 3 Hard

Topic: Legal Rules for Written Contracts

Learning Objective: 11-05 Discuss the Parol Evidence Rule.

Bloom's: Analyze

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

33) In 2012, Alder Inc. (seller) and Dell, Inc. (buyer) signed a long-term sales contract that provided for cashier's check payments to be made by Dell on the first of each month. In 2015, Dell began using a wire transfer payment method, and now Alder asserts that Dell is in breach of contract. Which of the following is true?

A) Dell cannot introduce oral evidence in court since it violates the parol evidence rule.

B) Dell can introduce evidence of the payment under the exception to the parol evidence rule.

C) Dell violated the best evidence rule, hence cannot produce evidence in court.

D) Dell can exclude parol evidence because wire transfers and cashier's checks are identical.

Difficulty: 3 Hard

Topic: Legal Rules for Written Contracts

Learning Objective: 11-06 Explain the exceptions to the Parol Evidence Rule.

Bloom's: Analyze

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

34) Willy and Brogan, aged 16, enter into a written contract in which Brogan will sell his horse to Willy for $250. Before the sale is finalized, Brogan seeks to be released from the contract and wants to offer in-court oral testimony concerning his age. The admission of Brogan's testimony is most likely governed by the ________ rule.

A) standard construction

B) best evidence

C) equal dignities

D) parol evidence

Difficulty: 3 Hard

Topic: Legal Rules for Written Contracts

Learning Objective: 11-06 Explain the exceptions to the Parol Evidence Rule.

Bloom's: Analyze

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

35) An exception to the ________ rule states that if a written agreement depends on some event before it becomes enforceable, ________ evidence may be offered regarding that ________.

A) parol evidence, written, condition precedent.

B) standard construction, written, condition precedent.

C) best Evidence, oral, condition precedent.

D) parol evidence, oral, condition precedent.

Difficulty: 3 Hard

Topic: Legal Rules for Written Contracts

Learning Objective: 11-06 Explain the exceptions to the Parol Evidence Rule.

Bloom's: Apply

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

36) Under the ________ rule, the courts generally accept into evidence only the original of a writing, not a copy.

A) best evidence

B) parol evidence

C) standard construction

D) equal dignities

Difficulty: 2 Medium

Topic: Legal Rules for Written Contracts

Learning Objective: 11-07 Explain the Best Evidence Rule.

Bloom's: Understand

AACSB: Reflective Thinking

Accessibility: Keyboard Navigation

37) Vega appoints Ancel, a real estate broker, to negotiate the sale of her home. The ________ rule requires that this agreement be in writing and signed to be enforceable.

A) parol evidence

B) best evidence

C) standard construction

D) equal dignities

Difficulty: 3 Hard

Topic: Legal Rules for Written Contracts

Learning Objective: 11-08 Discuss the Equal Dignities Rule.

Bloom's: Apply

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

38) Celebrity Shelly Dunkle, wishing to spend a few undisturbed days by herself, checks into a resort hotel. She reserves a suite under the name of Barbi and stamps the initials B.I. into the hotel register. She also orders room service and signs all hotel bills with those same initials. Which of the following statements is true?

A) Because Shelly has not signed her real initials, she cannot be held liable for the cost of the suite and all other bills she rings up under the initials B.I.

B) Because Shelly has not signed her real initials, the hotel management cannot prove that any contractual agreement took place between them.

C) Because the initials B.I. constitute Shelly's legal signature, she is legally obligated to pay for the cost of the suite as well as for other bills that she signs using those initials.

D) Because Shelly did not sign her real name both parties must split payments for all bills signed with the initials B.I.

Difficulty: 3 Hard

Topic: Formalities of Construction

Learning Objective: 11-08 Discuss the Equal Dignities Rule.

Bloom's: Analyze

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

39) Which of the following is true of "click" fraud?

A) The click-on process functions only in online contracts and not for online advertisements.

B) Clicks are proven ways to gauge interest in the advertiser's service or product.

C) A problem that arises in this area is verifying the identity of the "clicker."

D) The click-on process functions only for online advertisements and not for online contracts.

Difficulty: 2 Medium

Topic: Cyber-Commerce and the Law

Learning Objective: 11-09 Explain the problems associated with cyber-commerce.

Bloom's: Understand

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

40) The Fair and Accurate Credit Transactions Act:

A) establishes the same type of legal parity between electronic records and paper records.

B) is a federal act designed to deal with problems associated with cyber-commerce.

C) prohibits merchants from using credit card receipts that show anything other than the last five credit card numbers.

D) is a federal amendment to the Uniform Electronic Transactions Act.

Difficulty: 2 Medium

Topic: Cyber-Commerce and the Law

Learning Objective: 11-10 Outline the latest cyber-commerce statutes.

Bloom's: Understand

AACSB: Reflective Thinking

Accessibility: Keyboard Navigation

41) On September 1, Isabel contracts with Ned to sing at Ned's restaurant starting on October 1 and ending on October 15 of the following year. Discuss if this contract must be written and signed to be legally enforceable.

Difficulty: 3 Hard

Topic: The Statute of Frauds

Learning Objective: 11-02 Identify those contracts that must be in writing.

Bloom's: Evaluate

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

42) In June, the Daniels contracted with Twining to build a stone path leading from the road to their vacation home. They asked him to complete the job within 11 months. Explain whether Twining and the Daniels must enter into a written agreement for such a contract to be enforceable.

Difficulty: 3 Hard

Topic: The Statute of Frauds

Learning Objective: 11-02 Identify those contracts that must be in writing.

Bloom's: Analyze

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

43) On September 1st, Wild Willy's Club orally gives an order to T-Shirts R Us Inc. for T-shirts worth $600. The T-shirts have the date and location of Wild Willy's annual Christmas party on December 15th printed on them. In late October, Wild Willy's calls T-Shirts to cancel the order. T-Shirts has already processed the order and the T-shirts are ready to be shipped. Discuss in detail whether or not this oral order is enforceable once the T-shirts have been made.

Difficulty: 3 Hard

Topic: The Statute of Frauds

Learning Objective: 11-02 Identify those contracts that must be in writing.

Bloom's: Analyze

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

44) Jones orally agreed to sell his iPad Air to McKay for $475. He tried later to back out of the deal on the grounds that the oral agreement was unenforceable. Discuss the case.

Difficulty: 3 Hard

Topic: The Statute of Frauds

Learning Objective: 11-02 Identify those contracts that must be in writing.

Bloom's: Analyze

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

45) Emilio takes his unconscious friend, Todd, to the hospital. However, the hospital will admit Todd only if someone can promise to pay Todd's medical bills. Emilio orally promises to do so, and the hospital admits Todd. Discuss in detail whether or not this statement is legally binding on Emilio and/or Todd.

Difficulty: 3 Hard

Topic: The Statute of Frauds

Learning Objective: 11-02 Identify those contracts that must be in writing.

Bloom's: Evaluate

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

46) Joseph dies with no assets, but over $100,000 in personal debt. Joseph's daughter Samantha, who is very wealthy, is made executor of his estate. Joseph's creditors assert that Samantha must personally pay Joseph's debts because she is wealthy, Joseph's daughter, and now the executor of his estate. Is Samantha liable?

Difficulty: 3 Hard

Topic: The Statute of Frauds

Learning Objective: 11-02 Identify those contracts that must be in writing.

Bloom's: Analyze

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

47) Late one evening, Charles and Henry are discussing the purchase and sale of $2,500 of coffee shop equipment after an entrepreneurship class. They are in the classroom when Henry writes their agreement on the classroom whiteboard and both Henry and Charles sign it on the whiteboard. Discuss if this whiteboard document is sufficient to provide a binding written agreement.

Difficulty: 3 Hard

Topic: The Statute of Frauds

Learning Objective: 11-07 Explain the Best Evidence Rule.

Bloom's: Apply

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

48) Bernadette contracts in writing to sell Emily a flatbed trailer so that Emily's son can use the trailer as the base of a homecoming parade float on October 17. Bernadette knows all about the parade, but the written contract only requires Bernadette to deliver the trailer "in October" and Bernadette uses the trailer for her projects until October 20 when she tenders delivery to Emily. Emily refuses the trailer and refuses to pay the contract price since her son no longer needs it. Discuss in detail what evidence is admissible in a suit by Bernadette against Emily for breach of contract.

Difficulty: 3 Hard

Topic: Legal Rules for Written Contracts

Learning Objective: 11-04 Explain the Standard Construction Rule.; 11-05 Discuss the Parol Evidence Rule.; 11-07 Explain the Best Evidence Rule.

Bloom's: Evaluate

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

49) McDougal Construction and Espinosa entered a contract to build the latter a two-story house. However, after the company began its construction, Espinosa decided that she wanted a terrace garden, making the house a three-story. McDougal indicated the additional costs to Espinosa and completed the job including the terrace garden - neither of which was in writing or included in the original contract. Espinosa paid McDougal the original amount, but did not pay the extra amount for the third story. Discuss if the court will admit an oral testimony of the McDougal's to the original contract.

Difficulty: 3 Hard

Topic: Legal Rules for Written Contracts

Learning Objective: 11-06 Explain the exceptions to the Parol Evidence Rule.

Bloom's: Evaluate

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation

50) Kay, who is quite elderly, uses a star (*) as her signature. In a written contract, Kay's name is written, but on the signature line for Kay's name only the * that Kay made appears. Discuss whether or not the * binds Kay to the contract.

Difficulty: 3 Hard

Topic: Formalities of Construction

Learning Objective: 11-08 Discuss the Equal Dignities Rule.

Bloom's: Analyze

AACSB: Analytical Thinking

Accessibility: Keyboard Navigation