1
Chapter 16
The Writing Requirement
and Electronic Records
TRUE/FALSE QUESTIONS
B1. Every state has a statute that stipulates what types of contracts must be in
writing.
B2. The writing requirement under the Statute of Frauds means that an agreement
must be a formal written contract.
B3. Under the Statute of Frauds, all contracts must be in writing to be enforceable.
B4. A contract that can, by its own terms, be performed within one year from the
day after the contract is formed must be in writing to be enforceable under the
Statute of Frauds.
2 TEST BANK B—UNIT THREE: CONTRACTS AND E-CONTRACTS
B5. A contract that cannot, by its own terms, be performed within one year from the
day after the contract is formed does not need to be in writing to be enforceable
under the Statute of Frauds.
B6. The Statute of Frauds operates as a defense to the enforcement of an oral
contract for the sale of land.
B7. An agreement that includes an option to purchase real property must be in
writing for the option to be enforced.
B8. A collateral promise is one made by a third party to assume the debts or
obligations of a primary party to a contract if that party does not perform.
B9. A primary obligation is a promise to pay another’s debt only if that party fails to
pay.
B10. Any collateral promise falls outside the Statute of Frauds and does not need to
be in writing to be enforceable.
B11. When one creditor guarantees a debtor’s debt to another creditor to forestall
litigation, the guaranty does not need to be in writing to be enforceable.
CHAPTER 16: THE WRITING REQUIREMENT AND ELECTRONIC RECORDS 3
B12. A prenuptial agreement must be in writing to be enforceable under the Statute
of Frauds.
B13. A contract for a sale of goods priced at $501 must be in writing to be
enforceable.
B14. Unless a party against whom enforcement of an oral contract is sought admits
under oath that a contract for sale was made, the contract will not be
enforceable.
B15. To be enforceable as a contract, a writing must have been signed by the party
who seeks to enforce it.
B16. To be enforceable, a memorandum evidencing an oral contract that would
otherwise be unenforceable must include all essential and non-essential terms.
B17. Oral evidence of otherwise clear terms in a contract can be introduced at a trial
to contradict those terms.
4 TEST BANK B—UNIT THREE: CONTRACTS AND E-CONTRACTS
B18. Oral evidence of the modification of a contract after its making can be
introduced at a trial.
B19. An integrated contract is the complete and final statement of the terms of the
agreement.
B20. The Convention on Contracts for the International Sale of Goods incorporates
the UCC’s Statute of Frauds provision.
MULTIPLE-CHOICE QUESTIONS
B1. Sonya and Taylor enter into an oral contract that is required to be in writing to
be enforceable. Such a contract is normally
a. voidable by a party who does not wish to follow through with it.
b. void.
c. valid.
d. voidable but only by consent of both parties.
CHAPTER 16: THE WRITING REQUIREMENT AND ELECTRONIC RECORDS 5
B2. Sea Harvest Fish Company and Temp Refrigerated Storage Company enter
into a long-term lease for a warehouse. To be enforceable, the lease must be
in writing
a. only if the amount of the rent to be paid is less than $500.
b. only if the amount of the rent to be paid is more than $500.
c. only if the amount of the rent to be paid is more than $5,000.
d. regardless of the amount of the rent to be paid.
B3. Guardian Security, Inc., and Hedge Fund Corporation enter into an oral
contract under which Guardian Security agrees to provide security services for
Hedge Fund offices for as long as Hedge Fund needs them. This contract may
be enforceable by
a. Guardian Security only.
b. Hedge Fund only.
c. any interested third party, such as a Hedge Fund shareholder.
d. either Guardian Security or Hedge Fund.
B4. Colette and Dealership Auto Sales Company enter into an oral contract under
which Dealership Auto agrees to provide Colette with lifetime employment. This
contract may be enforceable by
a. Colette only.
b. Dealership Auto only.
c. any interested third party, such as a Dealership Auto customer.
d. either Colette or Dealership Auto.
6 TEST BANK B—UNIT THREE: CONTRACTS AND E-CONTRACTS
B5. Abner tells a representative of Brass & Woodwind Musical Instruments, Inc.,
that he will pay for Claudia’s trumpet if she does not. Abner does not secure
any personal benefit for this promise. Abner’s oral promise is enforceable as a
contract by
a. Brass & Woodwind Musical Instruments, Inc.
b. Claudia.
c. Abner.
d. none of the choices.
B6. Best Silo Storage applies for a business loan from County Credit Union. To
help Best Silo get the loan so that it will be able to stay in business and fulfill a
deal it has made with her, Dakota promises the credit union’s loan officer that
she will repay the loan if Best Silo does not. To be enforceable, Dakota’s
promise
a. need not be in writing.
b. must be in writing because it benefits Best Silo.
c. must be in writing because the credit union is not a party to the other
deal.
d. must be in writing because it benefits Dakota.
B7. Larue buys an iPod for $150 and a new laptop for $1,200, and signs a one-year
employment contract for a $4,800 monthly salary to start at the beginning of the
next month. The Statute of Frauds covers
a. the employment contract, and the laptop, and iPod purchases.
b. the employment contract and the laptop purchase only.
c. the employment contract only.
d. the laptop and iPod purchases only.
CHAPTER 16: THE WRITING REQUIREMENT AND ELECTRONIC RECORDS 7
B8. Eleanora offers Flossy the amount of an investment in Flossy’s start–up
business venture if she marries Eleanora’s son Glenn. This promise is
enforceable
a. only if it is in writing.
b. only if the amount of the investment is more than $500.
c. only if Glenn agrees to marry Flossy.
d. under no circumstances.
B9. Quest Holdings, Inc., orally contracts for a lease of its facilities to Ray to use for
his Swamp & Bayou Fishing Camp. Ray pays part of the rent, takes
possession, and improves the property for use by his enterprise. The contract
is most likely enforceable by
a. Quest Holdings and Ray.
b. Quest Holdings but not Ray.
c. any interested third party, such as a Swamp & Bayou client.
d. no one.
B10. Whitewater Canyon Adventures, Inc., and Xtra Overstock Company enter into
an oral contract for Xtra’s sale to Whitewater of five rafts for $2,000 each.
Before Whitewater takes possession of the rafts, this contract is enforceable by
a. Xtra only.
b. Whitewater only.
c. any interested third party, such as a Whitewater tour guide.
d. none of the choices.
8 TEST BANK B—UNIT THREE: CONTRACTS AND E-CONTRACTS
B11. Physicians Clinic orders by phone seven boxes of single-use latex gloves from
Quality Medical Supplies, Inc. After three boxes are delivered and accepted,
Physicians Clinic repudiates the contract. Quality Medical can enforce the
contract to
a. any extent because the order was placed orally.
b. no extent because the order was placed orally.
c. the extent of the three accepted boxes.
d. the extent of the four undelivered boxes.
B12. Benito orally promises Carolina that he will buy her modified 1968 Dodge
Charger. For this promise to be enforceable under the doctrine of promissory
estoppel,
a. the Charger must be considered a customized good.
b. Carolina must act in reliance on Benito’s promise to her detriment.
c. Benito’s promise must have been overheard by a third party.
d. there must be written evidence of the deal.
B13. Commercial Decor, Inc., files a suit against Discount Mart Corporation, asking
the court to enforce an oral contract between the parties under the doctrine of
promissory estoppel. This doctrine applies in
a. all states.
b. no states.
c. one state.
d. some states.
CHAPTER 16: THE WRITING REQUIREMENT AND ELECTRONIC RECORDS 9
B14. Lucas orally agrees to sell his Mountain Spring Beverage Company to Natural
Soft Drinks, Inc. Lucas notes the terms on a sheet of Mountain Spring
stationery and signs it. This agreement is most likely enforceable against
a. no one.
b. Lucas and Natural Soft Drinks.
c. Lucas.
d. Natural Soft Drinks.
B15. Grain Farms, LLC, and Harvest-to-Market Truck & Transport Company sign a
written contract that does not involve a sale of goods. To be enforceable, the
writing must include
a. a correct title, such as “Shipment Contract.”
b. all essential and nonessential terms.
c. a statement of the consideration.
d. a description of the parties’ businesses.
B16. Dinner Theater files a suit against Entertainers Agency, Inc., to enforce a con-
tract. The only written evidence of the contract is a memo on Entertainers’s let-
terhead signed by Fiorello, a company officer. The contract can be enforced if
the memo includes
a. a correct title, such as “Dinner Theater–Entertainers Artist Contract.”
b. Fiorello’s title.
c. all essential terms.
d. a reference to the source of the funds to be paid.
10 TEST BANK B—UNIT THREE: CONTRACTS AND E-CONTRACTS
B17. Hal’s True Hardware Stores and Ideal Tools, Inc., sign a written contract for a
sale of goods. To be enforceable, this written contract must include
a. a correct title, such as “Purchase Order” or “Sales Invoice.”
b. a date, such as “October 2014” or “10/2014.”
c. a quantity term, such as “50 hammers” or “100 boxes of assorted nails.”
d. the parties’ contact information.
Fact Pattern 16-B1 (Questions B18–B19 apply)
Alain and Brie sign a contract for the sale of Alain’s Coffee Café to Brie. The parties
intend their written contract to be a final statement of most, but not all, of the terms of
their agreement—Alain must first buy the building from Developed Commercial
Properties, Inc., after which Alain and Brie will negotiate a price.
B18. Refer to Fact Pattern 16-B1. Brie later disputes some of the provisions of the
deal with Alain. If the dispute results in litigation, a court will most likely admit
evidence of additional terms that are
a. ambiguous.
b. consistent.
c. contradictory.
d. clear.
B19. Refer to Fact Pattern 16-B1. The writing that Alain and Brie signed is
a. a completely integrated contract.
b. a conditionally integrated contract.
c. a partially integrated contract.
d. a supplemental integrated contract.
CHAPTER 16: THE WRITING REQUIREMENT AND ELECTRONIC RECORDS 11
B20. The owners of Ngai Rice Valley Farms, Inc., and Ozuru Markets, Ltd., are
citizens of countries that had ratified the Convention on Contracts for the
International Sale of Goods. They enter into a contract for a sale of rice. To be
enforceable, this contract
a. need not be in writing.
b. may be oral or written, but has certain requirements as to form.
c. must be in writing.
d. must comply with the UCC’s Statute of Frauds provisions.
ESSAY QUESTIONS
B1. Raconteur Data Analysis Corporation in Seattle, Washington, offers a job to
Trista, who lives in Utah. Trista orally agrees to work for Raconteur for two
years. She moves her family to Seattle and begins work. Three months later,
she is fired for no stated cause. She files a suit against Raconteur for rein-
statement or pay. Raconteur pleads the lack of a written contract. In whose
favor is the court likely to rule, and why?
B2. In a transaction for the sale of an auto painting facility, Bright Auto Colors
Company tells Custom Cars Corporation that the paints and other supplies on-
site are included. The contract says nothing about the supplies on-site, but
does state, “This document supersedes all oral promises relating to the sale.”
Are the supplies part of the sale? Why or why not?
12 TEST BANK B—UNIT THREE: CONTRACTS AND E-CONTRACTS