AL Bar Contracts 1 — Questions and Answers
Question 1: Under the common law mirror-image rule, an acceptance that varies the terms of the offer is treated as:
- A valid acceptance with the new terms controlling
- A counteroffer rejecting the original offer (Correct answer)
- A conditional acceptance creating a voidable contract
- An enforceable modification
Correct answer: A counteroffer rejecting the original offer
At common law, an acceptance must mirror the offer exactly; any variation operates as a rejection and counteroffer.
Question 2: Consideration requires that the promisee provide:
- Something of substantial economic value
- A bargained-for exchange giving a legal benefit or detriment (Correct answer)
- Written proof of the exchange
- Pre-existing obligation to perform
Correct answer: A bargained-for exchange giving a legal benefit or detriment
Consideration must be a bargained-for exchange in which the promisee suffers a legal detriment or the promisor receives a legal benefit.
Question 3: The statute of frauds requires a writing signed by the party to be charged for contracts that:
- Involve more than $100
- Cannot by their terms be performed within one year from the making (Correct answer)
- Involve real property of any value
- Are made between merchants
Correct answer: Cannot by their terms be performed within one year from the making
The one-year provision of the statute of frauds requires a signed writing for contracts incapable of full performance within one year of their making.
Question 4: Under UCC Article 2, a merchant's firm offer is irrevocable for up to how long without consideration?
- 30 days
- 60 days
- 90 days
- 3 months (Correct answer)
Correct answer: 3 months
A merchant's signed, written firm offer under UCC § 2-205 is irrevocable for the stated time or, if none stated, a reasonable time not exceeding three months.
Question 5: When a party breaches an anticipatory repudiation, the non-breaching party may:
- Only sue after the performance date arrives
- Treat the repudiation as an immediate breach and sue at once (Correct answer)
- Only seek specific performance
- Accept the repudiation and modify the contract
Correct answer: Treat the repudiation as an immediate breach and sue at once
Anticipatory repudiation allows the non-breaching party to immediately treat it as a breach and bring suit without waiting for the performance date.
Question 6: The parol evidence rule bars admission of prior or contemporaneous oral agreements to:
- Supplement a partially integrated written contract
- Contradict or vary the terms of a fully integrated written agreement (Correct answer)
- Show fraud or misrepresentation in the formation
- Explain ambiguous contract terms
Correct answer: Contradict or vary the terms of a fully integrated written agreement
The parol evidence rule prohibits using extrinsic evidence to contradict or vary the terms of a fully integrated written agreement.
AL Bar Contracts 1
Under the common law mirror-image rule, an acceptance that varies the terms of the offer is treated as: