LLM Contract Law & Commercial Transactions 2 — Questions and Answers
Question 1: The Statute of Frauds requires which type of contract to be evidenced by a writing?
- Contracts for the sale of goods priced at $500 or more (UCC) (Correct answer)
- All oral contracts
- Employment contracts of any duration
- Contracts involving two parties
Correct answer: Contracts for the sale of goods priced at $500 or more (UCC)
UCC § 2-201 requires contracts for the sale of goods for $500 or more to be evidenced by a signed writing to be enforceable.
Question 2: What is 'anticipatory repudiation' in contract law?
- A party's clear statement before the performance date that it will not perform (Correct answer)
- Refusal to sign a contract after negotiations
- A unilateral modification of contract terms
- A party's request for more time to perform
Correct answer: A party's clear statement before the performance date that it will not perform
Anticipatory repudiation occurs when a party unequivocally indicates before the performance date that it will not fulfill its contractual obligations.
Question 3: Under the parol evidence rule, which type of evidence is generally excluded?
- Prior oral or written agreements that contradict a fully integrated written contract (Correct answer)
- Post-contract oral modifications
- Evidence of fraud or mistake in contract formation
- Trade usage and course of dealing
Correct answer: Prior oral or written agreements that contradict a fully integrated written contract
The parol evidence rule bars introduction of prior or contemporaneous oral agreements that contradict or vary the terms of a fully integrated written contract.
Question 4: In a contract for the sale of goods, what is the 'perfect tender rule' under the UCC?
- The buyer may reject goods if the tender fails to conform to the contract in any respect (Correct answer)
- Goods must be delivered on the exact date specified
- Payment must be made in full before title passes
- The seller must deliver goods in perfect physical condition
Correct answer: The buyer may reject goods if the tender fails to conform to the contract in any respect
UCC § 2-601 gives the buyer the right to reject the entire delivery, accept the whole, or accept any commercial unit if the goods or tender fail to conform to the contract in any way.
Question 5: Which contract defense allows a party to void a contract based on a false statement of material fact made by the other party?
- Fraudulent Misrepresentation (Correct answer)
- Unilateral Mistake
- Impossibility
- Unconscionability
Correct answer: Fraudulent Misrepresentation
Fraudulent misrepresentation allows rescission and possible tort damages when a party makes a knowing false statement of material fact intending to induce reliance.
Question 6: What does the doctrine of 'frustration of purpose' excuse?
- Performance where a supervening event destroys the value of the contract even though performance is still possible (Correct answer)
- Performance made physically impossible by an unforeseen event
- Performance where costs have dramatically increased
- All contractual obligations upon death of a party
Correct answer: Performance where a supervening event destroys the value of the contract even though performance is still possible
Frustration of purpose excuses performance when an unforeseen event substantially destroys the purpose for which a party entered the contract, even though performance remains technically possible.
LLM Contract Law & Commercial Transactions 2
The Statute of Frauds requires which type of contract to be evidenced by a writing?