NJ Bar Contracts and Commercial Law 1 — Questions and Answers
Question 1: Under the common law, a valid contract requires offer, acceptance, and which third essential element?
- Writing
- Consideration (Correct answer)
- Witnesses
- Notarization
Correct answer: Consideration
Common law requires offer, acceptance, and consideration — a bargained-for exchange — to form a binding contract.
Question 2: Under UCC Article 2, which of the following is required for a contract for the sale of goods over $500 to be enforceable?
- Notarized signature
- Writing signed by the party to be charged (Correct answer)
- Two witnesses
- An attorney's certification
Correct answer: Writing signed by the party to be charged
UCC 2-201 requires a writing sufficient to indicate a contract and signed by the party against whom enforcement is sought for sales over $500.
Question 3: The parol evidence rule generally bars introduction of prior or contemporaneous oral agreements that would contradict which type of document?
- A preliminary negotiation memo
- A fully integrated written contract (Correct answer)
- An oral agreement made after signing
- A letter of intent
Correct answer: A fully integrated written contract
The parol evidence rule prevents extrinsic evidence from contradicting a final, fully integrated written contract.
Question 4: Anticipatory repudiation occurs when a party clearly and unequivocally indicates before performance is due that it will do what?
- Request a modification
- Not perform its contractual obligations (Correct answer)
- Seek arbitration
- Assign the contract
Correct answer: Not perform its contractual obligations
Anticipatory repudiation is a party's unequivocal pre-performance announcement that it will not perform, entitling the other side to sue immediately.
Question 5: The doctrine of promissory estoppel allows enforcement of a promise even without consideration when the promisee has done what?
- Filed a lawsuit
- Detrimentally relied on the promise (Correct answer)
- Obtained insurance
- Paid a nominal amount
Correct answer: Detrimentally relied on the promise
Promissory estoppel enforces a promise when a party reasonably and detrimentally relied on it and injustice can only be avoided by enforcement.
Question 6: Under NJ law, which doctrine may render a contract unenforceable if one party had no meaningful choice and the terms are unreasonably favorable to the other?
- Impossibility
- Unconscionability (Correct answer)
- Frustration of purpose
- Novation
Correct answer: Unconscionability
Unconscionability doctrine invalidates contracts with procedural unfairness (no meaningful choice) and substantive unfairness (oppressive terms).
NJ Bar Contracts and Commercial Law 1
Under the common law, a valid contract requires offer, acceptance, and which third essential element?