46. Which of the following promises does not have to be evidenced by writing in order to be enforceable?
a. Jones’ agreement with Smith to sell his condominium for $100,000
b. Stewart’s promise to work for Austin for a two-year period
c. Dad‘s promise to the credit union that he will make payments on his son’s truck if his son does not pay
d. Mindy’s agreement with Susan to buy her bike for $400
47. Chris receives a printed form in the mail from Wyandott Heating indicating that he has placed a telephone order for
a $600 heater. He doesn’t recall placing the order. Which of the following is correct?
a. Wyandott can hold Chris to the order.
b. Chris can hold Wyandott to the order.
c. Neither party is bound, because there is no signed writing.
d. Chris is bound if he makes no objection within 10 days.
48. In states that have adopted it, the UETA:
a. encourages and gives full effect to electronic contracts.
b. gives full effect to emergency transactions.
c. supplements and covers all of the UCC.
d. covers wills, codicils, and testamentary trusts.
49. Which of the following is an exception to the suretyship provision requirement under the statute of frauds?
a. A collateral promise made to the creditor
b. A promise, the leading object of which is to obtain an economic benefit for oneself
c. A collateral promise where there are three parties and two contracts involved
d. A promise by an executor to pay the debts of the decedent from the executor’s own funds
50. E-Sign provides consumers must:
a. evidence their consent on paper to conducting transactions with electronic records after being informed of the
types of hardware and software required.
b. receive a “clear and conspicuous” statement informing them of their right to withdraw consent to receiving
electronic records.
c. receive a “clear and conspicuous” statement informing them of their right to have the record provided only in
electronic form.
d. All of these.
51. What is another name for the main purpose doctrine?
a. The collateral promise rule
b. The possibility test
c. The leading object rule
d. The suretyship provision
52. Under the parol evidence rule, which of the following types of evidence may be used to vary or contradict the
written agreement?
a. Prior oral or written agreements
b. Contemporaneous oral or written agreements
c. Subsequent oral or written agreements modifying the original agreement
d. None of these.
53. Under the UCC, a(n) is a sequence of previous conduct between the parties to an agreement which may be
fairly regarded as establishing a common basis of understanding for interpreting their conduct under the contract.
a. course of dealing
b. usage of trade
c. course of performance
d. integrated document
54. Under the UCC, refers to the manner and extent to which the respective parties to a contract have accepted
successive tenders of performance by the other party without objection.
a. course of dealing
b. usage of trade
c. course of performance
d. integrated document
55. Under the UCC, a(n)
or trade.
a. course of dealing
b. usage of trade
c. course of performance
d. integrated document
is a practice or method of dealing, regularly observed and followed in a place or vocation
56. In determining the meaning of a contract under the UCC, which of the following will have first priority?
a. Course of performance
b. Course of dealing
c. Usage of trade
d. Express terms
57. Which of the following would NOT require a writing under the statute of frauds?
a. Where the buyer of a five-acre lot pays the $40,000 purchase price, thus fully performing his obligation
b. Where a renter agrees to rent a building for a 5-year period
c. Where a contractor enters into an agreement for an easement across adjoining land to run cables
d. Where a landscaper agrees to landscape the lot surrounding an office building
58. Which of the following would not be subject to the writing requirements of Article 2 of the UCC?
a. An unborn puppy whose mother is an AKC champion
b. Trees that will be cut from a ten-acre tree farm
c. Food served in the banquet room of a Florida resort
d. Medical care received in a hospital
59. E–Sign:
a. preempts the Uniform Electronic Transactions Act.
b. requires persons to agree to use or accept electronic records or electronic signatures, provided they are
informed of the types of hardware and software required and they have the required equipment.
c. defines the included transactions narrowly.
d. ensures that the electronic form of Internet and e-mail agreements will not make them unenforceable because
of the statute of frauds.
60. Which of the following need NOT be contained in a memorandum, which satisfies the general statute of frauds
writing requirement?
a. The names of the parties to the contract
b. The signature of the party being sued
c. The signature of the party suing
d. The subject matter and essential terms of the unperformed promises
61. Brightstone Co. and Allsale Co. enter an oral contract providing Allsale will provide 100 dozen toys at $50 per dozen
to Brightstone. Brightstone faxes a letter to Allsale acknowledging the agreement, but stating only the quantity, not
the price. Allsale:
a. cannot raise the defense of the statute of frauds if Allsale did not object to the letter within ten days after
receiving it.
b. cannot raise the defense of the statute of frauds since it is a merchant.
c. can raise the defense of the statute of frauds since the oral agreement was for the sale of goods with a price
of $500 or more.
d. can raise the defense of the statute of frauds since the writing did not contain all the material terms of the
agreement.
62. Most states have statutes requiring which of the following contracts to be evidenced by a writing to be enforceable?
a. Contracts to make wills.
b. Contracts for the sale of securities.
c. Contracts for the sale of personal property for more than $5,000.
d. Contracts creating certain types of security interests.
e. All of these.
63. On March 1, Sara, a student, received a telephone call from ComputerChip, Inc. offering her a job for one year
beginning on June 15, after completion of the school year. According to the personnel manager, she will have to
move to California and be ready to start work at 8:00 a.m. on June 15. Should Sara ask for a letter confirming the
telephone conversation if she accepts the offer immediately?
a. Yes, because the job offer is a collateral promise
b. Yes, because the job offer is covered by the parol evidence rule
c. Yes, because the job offer is for longer than one year from March 1
d. No, because the job offer is for one year from June 15
64. Which of the following would be admissible under the parol evidence rule? Assume the written contract was made
on June 1, 2010, and that it is an integrated document.
a. A letter dated July 9, 2010, reciting agreement to new delivery terms
b. A chart showing the dates for delivery written on August 16, 2009
c. A copy of two letters while the parties were in the negotiation stage of their contract which showed
agreement to a term not included in the June 1, 2010 contract
d. A copy of common carrier rules on the duty of delivery persons for uncrating merchandise, which is dated
December 1, 2006
65. Barry’s Sport Shop calls Champs Tee Shirt Company to order 200 designer tee shirts at $2 per shirt. The next day,
Barry decides he can easily sell 100 more. Before the order is filled, he calls to change the order to 300 tee shirts.
Champs sends 200. Can Barry force Champs to send the additional 100?
a. No, because there is no consideration for the extra 100 shirts
b. No, because Barry does not have a writing signed by Champs Tee Shirts
c. Yes, because this is a subsequent modification of the original contract
d. Yes, because Champs Tee Shirts is a merchant within the meaning of Article 2 of the UCC
66. Which of the following is untrue with regard to the interpretation of contracts?
a. Express terms prevail over course of performance, and course of performance prevails over course of
dealing.
b. Technical terms will always be given technical meaning even where a different intent is manifested by the
parties.
c. Handwritten or typed terms are given greater weight than preprinted terms.
d. All writings that are part of the same transaction are interpreted together.
67. Sam, a shopkeeper, dies unexpectedly at the age of 46. His lifelong business associate, Paul, is appointed the
administrator of the estate. Sam had a personal debt of $8,000 which he owed to Art’s Appliance Store. Paul says to
Art, “If there isn‘t enough money in the estate, I’ll personally see that the bill is paid.” Which of the following is
correct?
a. The oral statement is enforceable because Paul is the administrator.
b. An oral statement such as this is not enforceable because it is outside the statute of frauds.
c. An oral statement such as this is not enforceable because this promise is within the statute of frauds.
d. The oral statement is enforceable because it is a collateral promise.
68. The statute enacted by Congress which makes electronic records and signatures valid and enforceable for many
transactions affecting interstate or foreign commerce is the:
a. UETA.
b. UCC, Article 2E.
c. Electronic Signatures in Global and National Commerce Act.
d. Interstate and Foreign Commerce Electronic Transactions Act.
69. Which of the following promises in consideration of marriage would be outside the statute of frauds?
a. In consideration of Joan’s promising to marry him, a man promises to pay her an allowance and to give her all
of his property upon his death.
b. John and Mary mutually agree that their marriage shall not affect the existing property rights of the other.
c. John and Joan mutually promise to marry each other in a formal ceremony on June 23.
d. Joan promises to release a money judgment against Steven in consideration of his marrying her.
70. Under the UCC statute of frauds, which of the following terms must be included in a writing in order to satisfy the
writing requirement?
a. The price of the goods
b. The quantity of the goods
c. The signatures and names of the buyer and the seller
d. The time and place for delivery
71. Blevins, Inc. calls the Widget Corporation of America to order 400 widgets at $2 a widget. Widget accepts the oral
order and then sends out an order confirmation form, with the pre-printed name Widget Corporation of America on
the top of the form. The form states that an order has been received for “300” widgets and that it will be filled
promptly. In this case:
a. the order acceptance form fails to meet the writing requirement in the UCC, because it isn’t signed.
b. Blevins can enforce the contract for 300 widgets, but not for 400 widgets.
c. if Blevins signs and returns the form, it will be able to sue for the extra 100 widgets later.
d. the contract is enforceable for 400 widgets, because it has been partially performed.
72. The parol evidence rule does not apply to:
a. a typographical error that obviously does not represent the agreement of the parties.
b. evidence showing one of the parties to the contract lacks contractual capacity.
c. The parol evidence rule does not apply to the evidence in either of these situations.
d. The parol evidence rule applies to the evidence in both of these situations.
73. A contract contains a provision that states it will be effective for a “year.” The plaintiff in a lawsuit claims that a
“year” is obviously 12 months. The defendant claims that the contract meant a 10–month school year. Parol evidence:
a. cannot be used to explain the term, because the plain meaning of a “year” is 12 months.
b. cannot be used to explain the term, because it is an integrated document.
c. can be used to clarify the parties’ intent because in this contract the term “year” is ambiguous.
d. cannot be used, because the contract contains an express term that could have been changed by the parties
prior to the contract’s execution.
74. Requirements for a memorandum that satisfies the statute of frauds include that the writing:
a. must be a single document.
b. must exist at the time of the litigation.
c. needs to be notarized.
d. None of these.
75. Stan orally agreed to sell his house to Humphrey and Humphrey made a down payment. Humphrey wanted it ready
for his family quickly, so he had a new roof put on, new carpeting installed, and renovated the kitchen. Stan now
thinks the place looks great and has decided not to sell. A business law student told him he could refuse to sell
because the agreement was oral. Can he? Explain.
76. Richard agrees to supply Henry with all his needs of specially made shampoo for Henry’s beauty salon. Henry
believes that Richard is a representative of a famous hair products company, but he finds a letter to a competitor
written by Richard two days before the agreement is signed proving that Richard is a fraud. Richard says that this
letter may not be admitted to court since the contract is wholly integrated. Is he correct?
77. Answer the following:
a. What are the basic requirements of a writing within the statute of frauds in Article 2 of the
UCC?
b. What are the three exceptions to the writing requirement found in Article 2?
78. With regard to the interpretation of a contract, what priority is given to each of the following items?
(a) Course of dealing
(b) Usage of trade
(c) Express terms
(d) Course of performance
79. Define the statute of frauds and give an example.
80. Explain what the parol evidence rule is and when it is used.