Contracts and Sales Flashcards

A famous portrait painter contracts to paint a client's portrait but dies before beginning the work. What is the effect on the contract?

Answer: The contract is discharged by impossibility because personal services by a unique performer cannot be delegated

Death of a party whose unique personal performance is essential discharges the contract through impossibility.

A buyer contracts to purchase a rare vintage car. Before delivery, the seller sells the car to a third party who takes in good faith. What is the buyer's most likely remedy?

Answer: Money damages for breach, since the car is now in the hands of a good-faith purchaser

Specific performance is generally unavailable once unique goods pass to a good-faith purchaser, leaving the buyer to damages.

A wholesaler and retailer exchange forms; the retailer's acceptance adds an arbitration clause. Both parties are merchants and neither form limits acceptance to its own terms. Under UCC 2-207, does the arbitration clause become part of the contract?

Answer: It becomes part of the contract unless it materially alters the agreement or is objected to

Between merchants, additional terms in an acceptance become part of the contract unless they materially alter it, the offer limits acceptance, or objection is made.

An uncle promises his nephew $10,000 if the nephew refrains from smoking and drinking until age 25. The nephew complies fully. Is the uncle's promise supported by consideration?

Answer: Yes, because the nephew's forbearance of a legal right is valid consideration

Forbearance from exercising a legal right, as in Hamer v. Sidway, constitutes valid consideration regardless of benefit to the promisee.

A contract requires a farmer to deliver 1,000 bushels of wheat 'from the farmer's north field.' A flood destroys the entire north field crop without the farmer's fault. What is the farmer's best defense to a breach claim?

Answer: Impracticability, because the agreed source of the goods was destroyed without fault

Destruction of the contractually specified source of goods without fault excuses performance under the doctrine of impracticability.

A buyer accepts delivered machinery, then discovers a latent defect substantially impairing its value that was difficult to detect. What may the buyer do under the UCC?

Answer: Revoke acceptance within a reasonable time after discovering the defect

UCC 2-608 permits revocation of acceptance when a defect substantially impairs value and was not reasonably discoverable at acceptance.

A debtor owes a creditor an undisputed, liquidated debt of $10,000. The debtor sends a check for $6,000 marked 'payment in full,' and the creditor cashes it. Under the common law, is the remaining $4,000 discharged?

Answer: No, because payment of a lesser amount on an undisputed liquidated debt lacks consideration for discharge

Accord and satisfaction requires a good-faith dispute; part payment of a liquidated, undisputed debt provides no consideration to discharge the balance.