Debtors of overburdensome debts

Tom entered into a contract to coach the Cowboys, a football team. He subsequently assigned 1/3 of his salary to the Special Olympics.  The SO failed to notify the Cowboys of the assignment and the Cowboys paid Tom in full.  In a suit by the SO against the Cowboys for the money, most likely:

1. The SO will not succeed because the assignment was gratuitous and such assignments must be evidenced by a writing to be enforced
2. The SO will not succeed because they failed to give notice to the Cowboys of the assignment
3. The SO will not succeed because this contract right cannot be assigned

1. The SO will succeed because the assignment was irrevocable

 

2. Which of the following is not a goal of Chapter 7?

1. To relieve certain debtors of overburdensome debts.
2. To give most debtors a fresh start.
3. To provide equitable treatment for creditors.

1. To prevent secured creditors from paying themselves first out of collateral.

 

3. Jo contracts with X to paint his portrait. When X is ¼ completed, Jo repudiates the contract.  Even so, X completes the portrait, aware that Jo is the only person in the world who would want it.

1. X may not recover for the additional expenses he incurred in completing the portrait since he should have mitigated those losses by stopping
2. X may not recover any damages for Jo’s breach because he was under a duty to mitigate his losses by stopping performance
3. X may specifically enforce the contract and require Jo to pay the full contract price

1. If X had repudiated the contract prior to completing performance, Jo could specifically enforce the contract and require X to finish

 

 

 

4. Under the Federal Bankruptcy Code, a liquidation proceeding is also known as a(n):

1. Composition agreement

1. Rehabilitation petition
2. Straight bankruptcy
3. Extension
4. Assignment for the benefit of creditors

 

5. Which of the following statements is true?
6. The writing required under the Statute of Frauds is a specific formal contract.
7. Both parties to a contract falling under the Statute of Frauds must sign in to satisfy the writing requirements.
8. Only the party to be charged need sign a writing within the Statute of Frauds.
9.    The signature must be original, i.e., not printed or typed, and must be at the bottom o the document.

 

6. Which promise is supported by consideration?

1. Diane, a Ph. D., promises to pay Mother $200 a month for the rest of her life once Mother turns sixty-five because of all the financial help Mother gave her while Diane attended college.
2. Diane promises to pay Mother $200 a month for the rest of her life once Mother turns sixty-five if mother will financially support Diane in her quest for a Ph.D.
3. Both promises are equally supported by consideration.

1. Neither promise is supported by consideration.

 

7. All tort actions require the plaintiff to prove:
8. The existence of a legal duty owed by the defendant to the plaintiff.
9. An injury or damage proximately caused by the defendant’s conduct.
10. Breach of a legal duty owed by the defendant to the plaintiff
11. All of the above
12. Only a and c, above

 

8. John entered into a consulting contract with a design company. He subsequently assigned his salary to the Red Cross (RC). The RC failed to notify the design company of the assignment and the company paid John in full.  In a suit by the RC against the design company for the money, most likely:
9. The RC will not succeed because the assignment was gratuitous and such assignments

must be evidenced by a writing to be enforced

1. The RC will not succeed because they failed to give notice to the design company of the assignment
2. The RC will not succeed because this contract right cannot be assigned
3. The RC will succeed because the assignment was irrevocable

 

9. In a bankruptcy proceeding, an automatic stay:

1. Exempts the debtor’s assets from the claim of creditors
2. Prevents insolvency
3. Prevents further efforts by creditors to enforce collection of their debts

1. Required the debtor to liquidate his/her assets immediately

 

10. Which statement is most accurate?

1. A clause will be a valid liquidated damage clause and not a penalty if it is called a liquidated damage clause
2. The remedy for breach of contract is usually compensatory damages, unless severe losses are incurred, in which case nominal damages are also awarded
3. In to recover consequential damages, a non-breaching party must show that the breaching party was reasonably aware of the special circumstances which caused the special losses and the breach must be the cause of the losses

1. Punitive damages are generally recoverable in breach of contract actions

 

 

11. Chapter 13 of the Bankruptcy Code permits only voluntary proceedings to be brought by:

1. Individuals

1. Corporations

1. Partnerships

1. None of the above

 

 

12. In which of the following situations would punitive damages is recoverable?

1. Seller contracts to deliver 800 widgets to er at $1.00 per widget and breaches, forcing er to purchase the widgets elsewhere at the same price
2. er purchases a used car from Seller, a dealer, and discovers the odometer has been set back 40,000 miles
3. Seller agrees to deliver soybeans to er in a contract which makes time “of the essence” and then delivers the soybeans one month late
4. All the above

1. None of the above

 

 

13. If a promisor makes a promise knowing that the promisee or a third person will rely upon it, and the promisee or third person changes the position in reliance upon the promise by acting or forbearing to act, then the promisor is bound to perform to the extent necessary to avoid injustice to the reliant party under the doctrine of:
14. Equitable estoppel
15. Promissory estoppel
16. Justifiable reliance
17. Firm offer
18. Justified estoppel

 

14. A contract to provide bagels to a restaurant provides that it will continue in force indefinitely but is subject to immediate termination at the option of either party. The absence of a prior notice requirement in such a contract makes it:

1. Enforceable, nevertheless
2. Subject to an accord and satisfaction
3. Illusory
4. Conditional

1. None of the above

 

15. 15. In either an output contract or a requirements contract, quantity must always be fixed:
16. By the er in good faith
17. By the er and seller in good faith
18. Within estimates
19. Below estimates

 

 

16. A seller is generally given an opportunity to cure when the er rejects a nonconforming tender that the seller:

1. Has specifically manufactured for the er

1. Has been shipped “F.O.B. destination”
2. Had reasonable grounds to believe would be acceptable
3. Has not been inspected until after full payment has been arranged by the er
4. Both a or c, above

 

17. A security interest is a:

1. Creditor’s interest in property belonging to the debtor
2. Debtor’s interest in property belonging to a third party
3. Debtor’s interest in both real and personal property

1. Bailment relationship created under the Statute of Frauds

 

 

18. A er at a garage sales takes free of security interests UNLESS:

1. The goods were once inventory
2. The goods were once equipment
3. The goods are consumer goods in the seller’s hands
4. The secured creditor both automatically perfected and filed

1. The goods are pledged

 

19. All but which of the following are considered inchoate crimes:
    1. Solicitation
    2. Conspiracy
    3. Attempt
    4. Criminal commission
    5. A and d, above

 

 

20. Mary, a 17-year-old-minor promised to pay Dr. Quack $50 a visit in return for treatment for a life-threatening illness. Amazingly, after three treatments, Mary was cured. She refuses to pay pleading being a minor as a defense.

1. May disaffirm the contract and is not liable to pay.
2. Mary may not disaffirm the contract because she cannot return the benefits bestowed.
3. Mary is bound to pay the contract price.

1. Mary is bound to pay the reasonable value of Quack’s services.

 

 

 

21. A common method of perfecting a security interest is by filing a:

1. Negotiable document of title
2. Financing statement
3. Statutory obligation of intent

1. Termination statement

 

22. What is the purpose of the “voidable title rule”?
23. to protect the seller’s interest in the goods
24. to protect the agent of the er
25. to protect the er in good faith
26. none of the above

 

 

23. Specific performance is usually awarded:

1. In all cases involving the UCC
2. In all cases involving the Federal Code
3. Where the property in question is unique
4. When the court awards nominal damages

1. Only in constructive trust situations

 

24. Spencer contracts with Melissa to build cabinets in her house according to certain specifications. Spencer performs the contract but instead of placing ceramic knobs on the drawers as the blueprint called for, Spencer installs brass knobs.
25. Spencer is in breach of contract.
26. Spencer has breached a condition subsequent.
27. Spencer probably has substantially performed.
28. All of the above
29. A and c only

 

25. Which of the following justifications is not a valid reason for upholding a state regulation which affects interstate commerce?

1. The state statute serves a legitimate purpose such as protecting the health, safety or welfare of the state’s citizens.

1. The benefits of the regulation to the state outweigh the burdens on interstate commerce.

1. The statute protects local industry from out-of-state competition.

1. The statute applies equally to interstate and intrastate commerce.

 

 

26. Under an equal protection analysis, courts will most strictly scrutinize laws which classify persons according to:

1. Age
2. Sex
3. Race

1. Wealth

 

 

27. Kirk built a fence around his backyard that was two feet over his property line and on his neighbor’s land. A court directing Kirk to remove the fence from his neighbor’s yard is an example of a:

1. Prohibitory injunction
2. Recission
3. Mandatory injunction
4. Restitution

1. None of the above

 

28. 28. If an anticipatory repudiation occurs, the non-breaching party:
29. May commence suite immediately and need not wait for the scheduled time of performance
30. Must wait until the time for performance before commencing suit
31. Must perform his remaining duties under the contract in to retain the right to sue for damages
32. None of the above

 

29. The Statute of Frauds required that certain types of contracts:

1. Be in writing in to be illegal
2. Be in writing in to be enforceable
3. Contain a promise for an act

1. Contain a promise to be enforceable

 

30. A person holding a voidable title to goods in his possession has the power to:
31. Transfer good title to any purchaser
32. Avoid liability for breach of contract
33. Transfer good title to a good faith purchaser for value
34. Declare a sales contract under $500 as voidable at his option
35. Transfer only a voidable title

 

31. Tom contracts to deliver 500 units of product “X” to Ben. Tome fails to make delivery.  Ben does not want money damages but, instead, wants delivery of the 500 units.  The remedy that Ben is seeking is known as:

1. Restitution
2. Mandatory injunction
3. Specific performance
4. Affirmative assignment

1. An elected remedy

 

 

32. Which of the following are consumer goods under Article 9?

1. A washing machine in an appliance store.
2. A washing machine waiting to be shipped from the factory where they were assembled.
3. A washing machine in a laundromat.
4. A washing machine in your apartment.

1. All of the above

 

 

33. If a plaintiff’s injury is caused by the tortious conduct of more than one person, the plaintiff:

1. Can sue only one tort-feasor
2. Can sue all persons whose conduct was a factor in causing the injury
3. Must prove that a crime has been committed in to recover damages

1. Can recover even if he or she suffered no injury

 

 

34. A condition subsequent is one that:
    1. Must always be in writing
    2. Must occur after the duty to perform arises
    3. Results from the performance of a duty
    4. Must occur before the duty to perform will arises

 

 

35. Ralston threatened to leave the Sultan Motel without paying his bill because the motel had no hot water, soap, or towels. The motel then forced Ralston to pay by locking him in his room.  Based upon these circumstances, Ralston has:

1. No cause of action because his threats amounted to criminal theft
2. No cause of action because the motel owner acted in a reasonable manner
3. A cause of action based upon false imprisonment

1. A cause of action based upon assault and battery

 

 

36. Which of the following situations is not an example of discharge because of impracticability?
37. Alice contracts to manufacture 10,000 shirts in Alice’s factory and her factory is destroyed by fire.
38. Ann contracts to sell her antique vase and the vase is stolen
39. Andy contracts to manufacture 10,000 shirts and his employees go on strike.
40. Abbot contracts to sell his tomato crop and it is destroyed by birds.

 

 

 

37. Which of the following is the most accurate statement?

1. In a bilateral contract, only one party needs to supply consideration
2. In a unilateral contract, only one party needs to supply consideration
3. In a bilateral contract, mutual promises are sufficient consideration
4. Both a and b.
5. None the above

 

 

38. Failure to perform a contractual obligation is called:
    1. The loss of a covenant
    2. A lack of condition
    3. A breach of contract
    4. The doctrine of contractual performance
    5. A failure of consideration

 

 

39. An express condition:
40. Must be an event that is not certain to occur
41. May only relate to a future event, not a present or past event
42. Generally need not be exactly complied with before the duty to perform arises.

d All of the above

 

 

40. If a promise is subject to condition:
41. The promisor’s duty to perform does not arise unless or until the condition occurs
42. Liability for breach of contract will result if the condition occurs and the promisor fails to perform
43. No liability will result if the condition does not occur and the promisor fails to perform
44. All of the above

 

 

41. A contract duty may be discharged by:
42. A novation
43. An accord and satisfaction
44. The non-occurrence of a condition
45. All of the above
46. None of the above.  Contract duties cannot be modified or extinguished by agreement.

 

42. The doctrine that relieves a contracting party of his or her duty to perform when the underlying purpose of the contract is defeated is known as the:
43. Negation of performance doctrine
44. Doctrine of defense waiver
45. Frustration of purpose doctrine
46. Exculpatory defense
47. Impracticability doctrine

 

 

43. The UCC and the common law of contracts provide similar rules for all but which of the following contract formation issues:

1. Parol evidence
2. Capacity of parties
3. Acceptance of an offer
4. Illegality

 

44. Under the frustration of purpose doctrine:
    1. Both parties’ ability to perform becomes impossible
    2. The event which frustrates the purpose of the contract occurs prior to the agreement being reached
    3. Both parties are bound to perform pursuant to the contract since performance is not impracticable
    4. The contract is excused; its purpose is totally frustrated

 

 

45. John owes Sue a debt obligation. Sue acknowledges the obligation but there is a disagreement over the amount of money still owed by John. John offers to settle the dispute by agreeing to pay an amount of money that is more than he believes is due but less than what Sue is expecting.  This is the basis for:
46. An option contract
47. An accord
48. An investment contract
49. d. A promissory estopel
50. None of the above

 

 

 

46. A person holding a voidable title to goods in his possession has the power to:

1. Transfer good title to any purchaser
2. Avoid liability for breach of contract
3. Transfer title to a good faith purchaser for value

1. Declare a sales contract under $500 as voidable at his option

 

 

 

47. Most contracts are:

1. Never discharged by performance
2. Discharged by performance
3. Fundamentally promises that lack consideration

1. Usually found to be inherently unenforceable

 

 

 

 

48. The UCC legal concept that a er of goods is entitled to require that goods tendered by the seller conform in all respect to the contract is called the:
49. Rule of divisibility
50. Doctrine of equitable performance
51. Perfect tender rule
52. Concurrent performance rule
53. Waiver of performance rule

 

 

 

 

49. The act by which one party, by words or conduct, unequivocally indicates his or her inability or unwillingness to perform a contract is called:
50. Refutation
51. Repudiation
52. Reformation
53. Illusory performance
54. A waiver of performance

 

50. Conditions provided by oral or written language of a promise or agreement are known as:
51. Illusory conditions
52. Mandatory conditions
53. Express conditions
54. Implied conditions
55. None of the above

 

 

Gretchen had an accident in her Pinto and brought the car to Fix Em for repairs. They entered into a written contract with Gretchen which outlined what work they were going to do, gave the cost of the repairs, and specified the date that the work would be completed. Gretchen was concerned that the front end of her car would need alignment as a result of the wreck, so Fix Em then orally agreed that they would toss in a free alignment with the repair job. Fix Em then failed to do the alignment.

 

1. Gretchen cannot enforce Fix Em’s promise because the Statute of Frauds requires it to be in writing.
2. Gretchen cannot enforce Fix Em’s promise because the parol evidence rule would preclude the introduction into court of the oral promise.
3. Both of the above.
4. None of the above.