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Exam 8: Real, Personal, and Intellectual Property

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Question 1

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A valid contract may be _____________ when there is some law that prohibits the courts from enforcing it.

A) Executed.
B) Executory.
C) Unenforceable.
D) Novated.
E) Condoned.

F) B) and D)
G) B) and E)

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Question 2

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Explain the effect of auctions held with reserve and without reserve, and discuss what happens if nothing is said regarding whether an auction is being held with reserve or without reserve.

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In an auction held with reserve, the sel...

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Question 3

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A ______________ contract is commonly defined as a promise in exchange for a promise.

An offer by a retailer to purchase seasonal goods from a wholesaler would not lapse before an offer to purchase goods that could easily be sold all year long.

Which of the following is sometimes referred to as an implied-in-law contract?

If a contract is valid, then by definition it is enforceable.

If a[n] __________ contract exists, the administrator of an offeror's estate must hold an offer open until it expires in accordance with the contract.

Reference - Saturday Auction. Barry, an auctioneer, was holding an auction on a Saturday morning. At the beginning of the auction, Barry announced that the auction was being held without reserve. Helen, Mary, and Chris were all in attendance. Helen saw an old cash register with a stuck drawer that she thought would look great in her den. The auctioneer put the cash register up for sale, noting that the drawer was stuck and that no one really knew what was inside. Helen bought it for $20. At the same auction, Mary saw a great deal on a used table. She bid $20 on it. No one else bid anything. Barry announced that $20 was clearly insufficient for the table, that it was worth much more than that, and that he was taking it out of the auction. Chris started bidding on a diamond ring for his girlfriend. He bid $2,000. Just as Barry was getting ready to say "Sold", Chris looked over at his girlfriend, decided that he was not sure about marriage, and leaped up yelling "I revoke." Barry, however, immediately yelled "Sold." When she got it home and broke into it, Helen discovered that the cash register actually contained $5,000. Unfortunately, Helen had a teenage son named Tad who started bragging to his friends about the family's good fortune. Barry heard about what had happened and sued Helen for return of the $5,000. Mary sues Barry attempting to obtain possession of the table. Barry sues Chris attempting to enforce a contract for the sale of the engagement ring. What is the likely result in the lawsuit brought by Mary against Barry for the table?

The person who makes an offer is called the _____________.

Reference - Refusal to Pay. Business law teacher, Debby needed some yard work done. She told her class that she would give $50 to the first person who mowed her yard. She also entered into an agreement with Brenda to trim some shrubbery for $40. Max went to mow Debby's yard. Unfortunately, just as he finished mowing, a neighborhood dog bit him, and he had to go to the emergency room for a couple of stitches. Debby refused to pay Max on the basis that the agreement was not in writing and that Max ended up being more trouble than he was worth. Max refused to pay the emergency room because he said that they did not have a binding, bilateral contract. Brenda refused to trim the shrubbery because she got a better offer and claimed that she was not bound on the contract until she started to perform. Which of the following is an appropriate characterization of the agreement between Debby and Max?

If nothing is stated to the contrary in terms of an auction, an auction is presumed to be ________.

The part of the Uniform Commercial Code that governs contracts for the sale of goods is Article __________.

Which of the following modifies the Mirror-Image Rule?

The mirror-image rule is applicable when a unilateral contract is involved.

In which of the following ways can an offer terminate?

Reference - Used Car Sales. Walter sells used cars. He is seeking a way to increase sales and profits because he would like to take his girlfriend on a nice diving trip to the Grand Cayman Islands. The first thing that Walter does is say that during the first week of December, he will give a $500 rebate on used cars under two years old. To spice things up, he also offers to sell any car on the lot that is under five years old for $1,000 to the first three customers who can hula hoop ten hours straight on December 7^th. (Hula hooping was a practice popular some years ago in which a large hoop would be swung around by a person, usually around the waist.) Walter was not very concerned about the hula hooping issue because he thought that no one would be able to hula hoop for ten hours straight. Walter put an advertisement pertaining to the rebate and hula hoop opportunity in the local newspaper. The promotion went over very well. Although he had several on hand, Walter ran out of cars under two years old within one day. During the rest of the week shoppers were told that no cars of that description were available. A customer named Sam was very unhappy when he discovered the next day that no cars under two years old were available. On December 7^th, while Walter was watching the hula hoopers, Sally was shopping for a car. She was in college and did not have much money. She saw one, an older car, that she liked but she really did not know if it ran or not. She was going to talk to her parents. Walter eventually approached her and Sally asked him if he would take $3,000 for the car. Walter said, "Yes, sold." Sally tried to explain that she needed to talk to her parents first, but Walter would not hear of it. While Walter was still fuming from his encounter with Sally, Zack walked up and started to criticize the nature of Walter's inventory. Walter told him that he had great cars. Zack pointed at an old jalopy that was banged up, had 200,000 miles on it, and a cracked windshield. Zack said, "Sure, I'll pay $10,000 for that car." Walter said, "Sold." Zack said, "Wait a minute. I was only kidding." Walter said, "No way." Meanwhile all the hula hoopers dropped out well prior to ten hours of hula hooping except for Barbara. One minute before the ten hours were up, Walter yelled out "I revoke!" Barbara completed the hula hooping anyway and asked for her car for $1,000. Walter refused saying that the offer was revoked. Sam was very angry and sued Walter for not having a car available that was under two years old so that he could get a good deal and a $500 rebate. Additionally, Barbara sued Walter, and Walter sued Zack and Sally. What is the likely result in Walter's lawsuit against Sally in which he claims that she must pay $3,000 for the car at issue?

If an acceptance is received after a rejection is received, the acceptance is still valid.

If a person wishes to ensure that an offer will in fact be held open for a set period of time, the person may do so by entering into a[n] ______________ contract with the offeror.

If a quasi-contract is imposed, the amount of damages for a breach is based upon the fair market value of any service provided to the defendant.

Reference - Used Car Sales. Walter sells used cars. He is seeking a way to increase sales and profits because he would like to take his girlfriend on a nice diving trip to the Grand Cayman Islands. The first thing that Walter does is say that during the first week of December, he will give a $500 rebate on used cars under two years old. To spice things up, he also offers to sell any car on the lot that is under five years old for $1,000 to the first three customers who can hula hoop ten hours straight on December 7^th. (Hula hooping was a practice popular some years ago in which a large hoop would be swung around by a person, usually around the waist.) Walter was not very concerned about the hula hooping issue because he thought that no one would be able to hula hoop for ten hours straight. Walter put an advertisement pertaining to the rebate and hula hoop opportunity in the local newspaper. The promotion went over very well. Although he had several on hand, Walter ran out of cars under two years old within one day. During the rest of the week shoppers were told that no cars of that description were available. A customer named Sam was very unhappy when he discovered the next day that no cars under two years old were available. On December 7^th, while Walter was watching the hula hoopers, Sally was shopping for a car. She was in college and did not have much money. She saw one, an older car, that she liked but she really did not know if it ran or not. She was going to talk to her parents. Walter eventually approached her and Sally asked him if he would take $3,000 for the car. Walter said, "Yes, sold." Sally tried to explain that she needed to talk to her parents first, but Walter would not hear of it. While Walter was still fuming from his encounter with Sally, Zack walked up and started to criticize the nature of Walter's inventory. Walter told him that he had great cars. Zack pointed at an old jalopy that was banged up, had 200,000 miles on it, and a cracked windshield. Zack said, "Sure, I'll pay $10,000 for that car." Walter said, "Sold." Zack said, "Wait a minute. I was only kidding." Walter said, "No way." Meanwhile all the hula hoopers dropped out well prior to ten hours of hula hooping except for Barbara. One minute before the ten hours were up, Walter yelled out "I revoke!" Barbara completed the hula hooping anyway and asked for her car for $1,000. Walter refused saying that the offer was revoked. Sam was very angry and sued Walter for not having a car available that was under two years old so that he could get a good deal and a $500 rebate. Additionally, Barbara sued Walter, and Walter sued Zack and Sally. Which of the following is the likely result in the lawsuit brought by Sam complaining that Walter ran out of cars available for a rebate?