NYLE Contract Law Principles 2 — Questions and Answers
Question 1: Under the UCC, a merchant's firm offer is irrevocable for up to how long without consideration?
- 30 days
- 3 months (Correct answer)
- 6 months
- 1 year
Correct answer: 3 months
UCC §2-205 makes a merchant's signed, written firm offer irrevocable for the stated period, not to exceed 3 months.
Question 2: Alice offers to sell her car for $10,000. Bob replies, 'I'll take it, but only if you include new tires.' Under common law, Bob has:
- Accepted with a condition precedent
- Made a counteroffer, rejecting Alice's offer (Correct answer)
- Created a bilateral contract
- Exercised the mirror-image rule in his favor
Correct answer: Made a counteroffer, rejecting Alice's offer
Under the common law mirror-image rule, adding new terms constitutes a counteroffer that terminates the original offer.
Question 3: Which doctrine allows a court to refuse enforcement of a contract term that is unreasonably favorable to one party and oppressive to the other?
- Promissory estoppel
- Unconscionability (Correct answer)
- Fraudulent misrepresentation
- Mutual mistake
Correct answer: Unconscionability
Unconscionability (UCC §2-302; Restatement §208) permits courts to refuse enforcement of oppressively one-sided contract terms.
Question 4: A modification to an existing contract for the sale of goods worth $600 requires:
- Consideration and a writing
- Only consideration
- Only a signed writing under the Statute of Frauds (Correct answer)
- No additional formality if both parties agree orally
Correct answer: Only a signed writing under the Statute of Frauds
Under UCC §2-209 and the Statute of Frauds, modifications bringing the contract within §2-201 (goods ≥$500) must be in writing.
Question 5: Under New York law, which of the following agreements must be in writing to be enforceable under the Statute of Frauds?
- A contract to mow a neighbor's lawn next week for $50
- A contract that cannot be performed within one year of its making (Correct answer)
- An oral lease for 10 months
- A contract to sell personal property worth $400
Correct answer: A contract that cannot be performed within one year of its making
New York's Statute of Frauds (GOL §5-701) requires a writing for contracts that cannot by their terms be performed within one year.
Question 6: Plaintiff sues for breach after defendant repudiates a contract before the performance date. This is known as:
- Prospective inability
- Anticipatory repudiation (Correct answer)
- Constructive breach
- Efficient breach
Correct answer: Anticipatory repudiation
Anticipatory repudiation occurs when a party unequivocally renounces contractual duties before the time for performance arrives.
Question 7: The parol evidence rule generally prevents introduction of prior or contemporaneous oral agreements that would:
- Explain an ambiguous contract term
- Add consistent additional terms to a fully integrated written contract (Correct answer)
- Show fraud in the inducement
- Establish a condition precedent to the contract's effectiveness
Correct answer: Add consistent additional terms to a fully integrated written contract
The parol evidence rule bars extrinsic evidence offered to add terms to a fully integrated (complete) written agreement.
NYLE Contract Law Principles 2
Under the UCC, a merchant's firm offer is irrevocable for up to how long without consideration?