Contracts Flashcards
7 cards from real IA BAR practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Contracts flashcards as text
A third-party beneficiary's rights under a contract vest when the beneficiary:
Answer: Learns of the contract and assents to it, relies on it, or brings suit to enforce it
Under Restatement (Second) § 311, a beneficiary's rights vest upon assent, material reliance, or filing suit, after which the parties cannot modify the contract to defeat those rights without consent.
In Iowa, an oral modification of a written contract that falls within the Statute of Frauds is generally:
Answer: Unenforceable unless supported by promissory estoppel or partial performance
Because the modified contract itself must satisfy the Statute of Frauds, an oral modification falls outside it and is unenforceable unless an exception like reliance or part performance applies.
Which doctrine allows a court to refuse enforcement of a contract clause that is oppressively one-sided and the product of unequal bargaining power?
Answer: Unconscionability
Unconscionability (procedural + substantive) allows a court to refuse enforcement of a clause or the entire contract when the process and terms shock the conscience.
A delegation of contractual duties differs from an assignment of rights because a delegation:
Answer: Transfers the burden of performance to a third party but does not release the delegator from liability
When duties are delegated, the delegatee takes on performance obligations, but the original delegator remains secondarily liable unless there is a novation releasing them.
Under the perfect tender rule applicable to UCC goods contracts, the buyer may reject goods that:
Answer: Fail to conform to the contract in any respect
UCC § 2-601's perfect tender rule allows a buyer to reject goods if they fail to conform to the contract in any way, however slight, subject to the seller's right to cure.
Which of the following best describes a novation?
Answer: Substituting a new party for an original party with the obligee's consent, releasing the original party
A novation substitutes a new obligor (or obligee) for an original party, and critically, it releases the original party from further liability with the obligee's consent.
Under the doctrine of substantial performance, a party who has substantially but not perfectly performed is entitled to:
Answer: The contract price minus damages for the deficiency in performance
Substantial performance allows the performing party to recover the contract price reduced by the cost of completing or correcting the non-material defects.