Question 1

Use this fact situation to answer the related questions that follow. On January 1,A and B enter into a contract under which B agrees to renovate A's house by September 1 for $60 000.00.By June 2,B has not yet started the renovations and A is getting worried,so A tells B that he will pay him an extra $5000.00 if B completes the renovations on time.B completes the renovations by September 1st and now asks A for $65 000.00.
In this situation,

Accepted Answer

A)  A's promise to pay B an extra $5000.00 is not supported by fresh consideration.
B)  A's promise to pay B an extra $5000.00 is made before the contract is over.
C)  the consideration for the contract on January 1 is $60 000.00.
D)  there was a contract on January 1 that must be performed by September 1.
E)  all of the aboveF) A) and C)
G) D) and E)

Question 2

Estoppel or promissory estoppel was developed to overcome the principle that payment of a lesser sum in satisfaction of a greater sum is no payment at all.

Accepted Answer

A) True 
 B)False

Question 3

Generally speaking,it is up to the court to ensure that a fair bargain was made;that is,to ensure that the consideration for a promise is adequate.

Accepted Answer

A) True 
 B)False

Question 4

An intention to create legal relations exists if

Accepted Answer

A)  the promisor and the promisee have identified all the consideration involved in the contract.
B)  there is an offer,acceptance,and consideration.
C)  a reasonable person would believe that the parties intended to be bound by the contract.
D)  the court examines the facts and determines that the parties intended to enter into legal relations.
E)  the parties have capacity to enter into a contract.F) A) and E)
G) C) and D)

Question 5

What is meant by "the meeting of minds"? How significant is it to the formation of contracts?

Accepted Answer

When parties are entering into a contrac...

Question 6

The principle of injurious reliance is

Accepted Answer

A)  the loss or harm that is suffered by a promisee who,to his or her detriment,relies on a gratuitous promise.
B)  the contractual relationship that arises between an injured party and the person or persons on whom this injured party relies.
C)  the injury that a person in a contractual relationship suffers when there is a breach of contract.
D)  the amount of compensation that is awarded to a party where there is a breach of contract.
E)  the personal injury that is suffered by persons who are involved in contractual situations.F) C) and E)
G) B) and E)

Question 7

Jack walks into a bar.He is a little tipsy.The waitress pours him a pint of beer and he pays with all the money he has on him.He makes this statement to the waitress: "Sorry I can't tip you today,but you know what,I have this lottery ticket,and if I win,I'll split it with you." The waitress says,"No problem,Jack." Jack later makes a copy of the ticket for the waitress.The next day Jack receives a call from Stephanie,the waitress,who tells him that she checked the numbers and that he has won $1 million.Stephanie asks,"Our deal is on right?" Jack says,"What deal?" She says,"You promised to split the winning ticket with me." He says,"Really?" Which of the following is true?

Accepted Answer

A)  Jack will have to split the proceeds with Stephanie on a quantum meruit basis.
B)  Stephanie can sue Jack for breach of contract if she does not get her share of the ticket.
C)  Jack promised to split the winning ticket with Stephanie and she accepted,so a valid contract was created.
D)  No contract arose because there was no intention on the part of Jack to enter into legal relations with Stephanie.
E)  A contract did not arise because Jack's statement was not an offer.F) D) and E)
G) A) and E)

Question 8

A gratuitous promise differs from a contract in that

Accepted Answer

A)  a gratuitous promise cannot lapse.
B)  it does not require the payment of money to the offeror by the offeree.
C)  consideration flows only in one direction.
D)  a gratuitous promise cannot be revoked.
E)  the terms of a gratuitous promise are not precise enough to be binding.F) A) and B)
G) All of the above

Question 9

Is it possible for a person to enter into an enforceable contract without receiving any benefit from the agreement?

Accepted Answer

It is possible for a person to enter int...

Question 10

Use this fact situation to answer the related questions that follow. On June 1,A,a debtor,loans $5000.00 from B,a creditor,and agrees to repay it by December 1 of the same year.On November 1,B says to A,"Rather than paying me the full $5000.00,just pay me $3500.00 and your debt will be cancelled." A pays the $3500.00,but B now changes his mind and tells A that he wants A to pay him the balance of $1500.00.
In this situation at common law,

Accepted Answer

A)  B cannot recover the extra $1500.00,because he agreed to reduce the amount of the debt.
B)  B is estopped by promissory estoppel from recovering the $1500.00.
C)  B can recover the extra $1500.00 on the basis of quantum meruit.
D)  B can recover the extra $1500.00 under present-day legislation.
E)  B can recover the extra $1500.00 since his promise lacks fresh consideration.F) C) and D)
G) B) and E)

Question 11

The reasonable amount that a person deserves to be paid for goods and services provided to the person requesting them is called

Accepted Answer

A)  gratuitous promise.
B)  quantum meruit.
C)  damages.
D)  covenant.
E)  promissory amount.F) B) and C)
G) A) and B)

Question 12

Which of the following is NOT true about consideration?

Accepted Answer

A)  Consideration must be of some value in the eyes of the law.
B)  A gratuitous promise is not supported by consideration.
C)  Consideration has to be adequate.
D)  Consideration must be sufficient.
E)  Consideration can be in the form of a detriment to a party.F) A) and B)
G) None of the above

Exam 7: Formation of a Contract: Consideration and Intention

A gratuitous promise differs from a contract in that

Correct Answer
verified

The reasonable amount that a person deserves to be paid for goods and services provided to the person requesting them is called

Correct Answer
verified

What is meant by "the meeting of minds"? How significant is it to the formation of contracts?

Correct Answer
verified
When parties are entering into a contrac...
View Answer

An intention to create legal relations exists if

Correct Answer
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Is it possible for a person to enter into an enforceable contract without receiving any benefit from the agreement?

Correct Answer
verified
It is possible for a person to enter int...
View Answer

Which of the following is NOT true about consideration?

Correct Answer
verified

The principle of injurious reliance is

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Generally speaking,it is up to the court to ensure that a fair bargain was made;that is,to ensure that the consideration for a promise is adequate.

Correct Answer
verified

Estoppel or promissory estoppel was developed to overcome the principle that payment of a lesser sum in satisfaction of a greater sum is no payment at all.

Correct Answer
verified

Exam 7: Formation of a Contract: Consideration and Intention

A gratuitous promise differs from a contract in that

Correct AnswerverifiedShow Answer

The reasonable amount that a person deserves to be paid for goods and services provided to the person requesting them is called

Correct AnswerverifiedShow Answer

What is meant by "the meeting of minds"? How significant is it to the formation of contracts?

Correct AnswerverifiedWhen parties are entering into a contrac...View AnswerShow Answer

An intention to create legal relations exists if

Correct AnswerverifiedShow Answer

Is it possible for a person to enter into an enforceable contract without receiving any benefit from the agreement?

Correct AnswerverifiedIt is possible for a person to enter int...View AnswerShow Answer

Which of the following is NOT true about consideration?

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The principle of injurious reliance is

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Generally speaking,it is up to the court to ensure that a fair bargain was made;that is,to ensure that the consideration for a promise is adequate.

Correct AnswerverifiedShow Answer

Estoppel or promissory estoppel was developed to overcome the principle that payment of a lesser sum in satisfaction of a greater sum is no payment at all.

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
When parties are entering into a contrac...
View Answer

Correct Answer
verified

Correct Answer
verified
It is possible for a person to enter int...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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