TX Bar Contracts 3

Question 1

Under the Statute of Frauds, which of the following contracts does NOT need to be evidenced by a writing to be enforceable?

Accepted Answer

A contract for the sale of goods priced at $800

Answer

A contract for the sale of land

Answer

A contract that cannot be performed within one year from the date of formation

Answer

A promise to answer for the debt of another (suretyship)

Question 2

Both a buyer and seller mutually believed, at the time of contracting, that a painting was an original work worth $50,000. It later turns out the painting is a forgery worth $500. Which defense best applies?

Accepted Answer

Mutual mistake of fact — both parties were wrong about a material fact existing at the time of contracting

Answer

Unilateral mistake — only one party was wrong

Answer

Frustration of purpose — a subsequent event destroyed the value

Answer

Impossibility — performance became objectively impossible

Question 3

A seller used high-pressure sales tactics to convince an elderly, isolated widow to purchase an overpriced product she did not need. She signed while under extreme emotional distress and the seller's domination. Which defense is most applicable?

Accepted Answer

Undue influence

Answer

Duress by physical threat

Answer

Mutual mistake

Answer

Illegality

Question 4

A contractor threatens to walk off a construction project midway through unless the owner agrees to pay an additional $50,000 beyond the contract price. The owner, facing serious losses if the project stops, agrees. Later, the owner seeks to avoid the modification. Which doctrine best supports the owner?

Accepted Answer

Economic duress (business compulsion)

Answer

Frustration of purpose

Answer

Mutual mistake

Answer

Lack of consideration for the modification

Question 5

A contract is challenged on unconscionability grounds. Which TWO elements must typically be proven?

Accepted Answer

Procedural unconscionability (unfair bargaining process) and substantive unconscionability (oppressive terms)

Answer

Mutual mistake and fraudulent misrepresentation

Answer

Illegality and lack of consideration

Answer

Duress and undue influence

Question 6

A contract requires a contractor to install a specific brand of pipe. The contractor installs a different brand of equal quality and value without telling the owner. The owner discovers the substitution and sues. Under which theory is the owner's claim strongest?

Accepted Answer

The contractor has breached the contract, though damages may be nominal if there is no diminution in value

Answer

The contract is void for illegality

Answer

The contractor is entitled to enforce an implied modification

Answer

The owner must accept the substitute under the doctrine of commercial impracticability

Question 7

A person signed a contract after fraudulently induced by the seller's false statement that the goods were certified organic, when they were not. The buyer seeks to rescind. Which elements must the buyer establish for fraudulent misrepresentation?

Accepted Answer

False representation of material fact, made with scienter, intended to induce reliance, justifiably relied upon, causing damages

Answer

That the seller had bad intentions and the buyer was gullible

Answer

That the contract lacked consideration and the parties were not in privity

Answer

That the statute of limitations has not run and the seller is insolvent