Contracts Flashcards

Which of the following is NOT a recognized defense to contract formation?

Answer: Anticipatory repudiation

Anticipatory repudiation is a breach doctrine, not a formation defense — duress, undue influence, and mutual mistake all go to defects in the contracting process.

Under the parol evidence rule, extrinsic evidence is generally inadmissible to:

Answer: Contradict or vary the terms of a final integrated written agreement

The parol evidence rule bars introduction of prior or contemporaneous extrinsic evidence to contradict or vary the terms of a final, integrated written agreement.

When a party to a contract learns the other party will not perform before the performance date, this is called:

Answer: Anticipatory repudiation

Anticipatory repudiation occurs when a party clearly indicates before the performance date that it will not perform its contractual obligations.

Under the common law, which of the following is an excuse for nonperformance based on an unforeseen event?

Answer: Impossibility or frustration of purpose

Impossibility (objective inability to perform) and frustration of purpose (principal purpose has been destroyed by an unforeseen event) are recognized excuses for nonperformance.

Which of the following best describes expectation damages in a contracts context?

Answer: Damages that put the plaintiff in the position they would have been in had the contract been performed

Expectation damages — the standard contract remedy — aim to place the non-breaching party in the position it would have occupied had the contract been fully performed.

Under the Restatement (Second) of Contracts, a contract is voidable for mutual mistake when:

Answer: Both parties were mistaken about a basic assumption that materially affects the exchange

Mutual mistake doctrine voids a contract when both parties share a mistaken belief about a basic assumption on which the contract was made, and the mistake materially affects the agreed exchange.