IL Bar Contracts 1 — Questions and Answers
Question 1: Under common law contract principles, which of the following is required for a valid contract?
- Offer, acceptance, and a writing
- Offer, acceptance, consideration, and mutual assent (Correct answer)
- A signed document and two witnesses
- An exchange of money
Correct answer: Offer, acceptance, consideration, and mutual assent
A valid contract requires offer, acceptance, consideration, mutual assent (meeting of the minds), and capacity; a writing is only required by the Statute of Frauds for certain contracts.
Question 2: The mailbox rule provides that an acceptance is effective:
- When the offeror receives it
- When the offeree deposits it in the mail (Correct answer)
- When it is read by the offeror
- Only if sent by certified mail
Correct answer: When the offeree deposits it in the mail
Under the mailbox rule, acceptance is effective upon dispatch — when properly mailed — not upon receipt by the offeror.
Question 3: Under Article 2 of the UCC, a merchant's written offer to buy or sell goods stating it will be held open is irrevocable for the stated period (up to three months) without consideration. This is called a:
- Option contract
- Firm offer (Correct answer)
- Irrevocable offer
- Standing offer
Correct answer: Firm offer
UCC § 2-205 creates the firm offer rule, making a signed written offer by a merchant irrevocable for the stated time (not exceeding three months) without requiring consideration.
Question 4: Which of the following contracts is within the Illinois Statute of Frauds and must be in writing to be enforceable?
- A contract for the sale of goods worth $200
- A two-year employment contract (Correct answer)
- A contract to be performed within one year
- A month-to-month lease
Correct answer: A two-year employment contract
Contracts that cannot be performed within one year of formation — such as a two-year employment contract — must be evidenced by a writing under the Statute of Frauds.
Question 5: Promissory estoppel allows enforcement of a promise without consideration when:
- The promise is in writing
- The promisee reasonably and foreseeably relied on the promise to their detriment (Correct answer)
- Both parties are merchants
- The promisor is a government entity
Correct answer: The promisee reasonably and foreseeably relied on the promise to their detriment
Promissory estoppel requires a clear promise, foreseeable and actual reliance by the promisee to their detriment, and injustice that can only be avoided by enforcement.
Question 6: Under the common law perfect tender rule for services contracts, substantial performance doctrine allows recovery if:
- The contract was fully performed in every detail
- The breaching party performed in good faith and the defect is minor (Correct answer)
- The other party was also in breach
- Performance was rendered within a reasonable time
Correct answer: The breaching party performed in good faith and the defect is minor
Substantial performance allows a party who has performed in good faith, with only minor and unintentional defects, to recover the contract price minus damages for the shortfall.
IL Bar Contracts 1
Under common law contract principles, which of the following is required for a valid contract?