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Question 1
0 out of 2 points
AGRO contracts to hire Consultant to review AGRO’s human resources policies and “prepare
a report containing all of Consultant’s recommendations for AGRO’s policies.” Consultant
wonders what his specific obligations are to AGRO. Choose the best answer:
Selected
Answer: Consultant must exercise best efforts in negotiating, performing, and
enforcing the contract.
Question 2
0 out of 2 points
Section 2-202 of the Uniform Commercial Code differs from the common law Parol
Evidence Rule in which way?
Selected
Answer: The UCC allows a partially integrated agreement to be supplemented with
consistent extrinsic evidence, but the common law does not.
Question 3
0 out of 2 points
CarterCo contacts to sell and DanaCo to buy 2,000 watches specially designed for use by
divers who perform industrial underwater welding. The agreement describes the watches as
“deep ocean-rated diving timepieces.” Several of the watches fail when used by divers at a
depth below 500 meters. CarterCo claims that 500 meters is too deep for the watches.
DanaCo claims that the watches failed between 500 and 750 meters, and that such use
constitutes “deep ocean” diving. DanaCo seeks to introduce evidence that when the first
eight watches failed, CarterCo replaced them. Which answer best describes DanaCo’s
evidence:
Selected Answer:
Evidence of usage in trade.
Question 4
0 out of 2 points
Which of the following is a false statement about the Parol Evidence Rule?
Selected
Answer: The Parol Evidence Rule does not preclude introduction of extrinsic
evidence to explain an ambiguous term.
Question 5
0 out of 2 points
Which of the following statements regarding the Parol evidence rule is false?
Selected Answer:
The Parol Evidence Rule applies in every case involving oral
agreements.
Question 6
2 out of 2 points
AGRO agrees to provide as many bales of “elephant feed” as the Municipal Zoo requires.
The agreement does not include an ending date. After performing the contract for two years,
AGRO wonders when its obligations end. Choose the best answer:
Selected
Answer: The contract continues until one of the parties provides reasonable notice of
termination to the other.
Question 7
0 out of 2 points
Seller enters into a contract with Buyer to sell three bulldozers to Buyer for $240,000 each.
The written contract is completely integrated but does not contain a no-oral-modification
provision. After the written contract is signed and before the contract is performed, Buyer
and Seller agree over the telephone to increase the number of bulldozers to four, but to keep
the price the same: $240,000 each. Assume the CISG applies to this transaction. Choose the
best answer.
Selected
Answer: The telephone conversation may be included because contracts supported by
consideration are always admissible.
Question 8
0 out of 2 points
Seller enters into a contract with Buyer to sell three used motorcycles to Buyer for $3,000
each. The written contract is completely integrated and contains a no-oral-modification
provision. After the written contract is signed and before the contract is performed, Buyer
and Seller agree over the telephone to increase the number of motorcycle to four, but to keep
the price the same: $3,000 each. Choose the best answer.
Selected
Answer: The modification is unenforceable because the written contract includes a
no-oral-modification provision.
Question 9
2 out of 2 points
Alan signs a purchase agreement to buy a used car from Dealer. The purchase agreement is a
complete integrated agreement, prepared by the Dealer. However, the purchase agreement
describes the vehicle purchased as a “Red 2015 Chevy Silverado.” There are two red Chevy
Silverado vehicles on the Dealer’s lot, and a dispute arises regarding which one was the
subject of the purchase agreement. Choose the best answer:
Selected
Answer: If the jurisdiction employs the “all the circumstances” approach, the court will
consider testimony from Alan and Dealer regarding their negotiations to
determine if “Red 2015 Chevy Silverado” is an ambiguous term.
Question 10
2 out of 2 points
Which answer best describes priority of evidence of parties’ intent?
Selected Answer:
Course of performance prevails over course of dealing.
Question 11
2 out of 2 points
GlassGlassGlass, LLC manufactures glass used in specialty industrial and defense
applications. Its salesperson provides a sample of its SuperGlass material to VehicO, Inc., a
manufacturer of specialized law enforcement vehicles. VehicO purchases a quantity of
SuperGlass and finds that it does not perform as well as the sample did. The contract
between GlassGlassGlass, LLC and VehicO, Inc. makes no reference to any warranty.
Choose the best answer:
Selected
Answer: The sample provided creates an express warranty that the goods provided
will conform to the sample.
Question 12
2 out of 2 points
Where a contract for the sale of goods fails to include a term, the UCC frequently provides a
_______________ filling term.
Selected Answer:
Gap
Question 13
2 out of 2 points
In order to apply the Parol Evidence Rule, it is necessary to assess
Selected Answer:
Both (a) and (b).
Question 14
2 out of 2 points
In process of interpreting contract terms, the court will apply which of the following rules?
Selected Answer:
Specific terms will control over general terms.
Question 15
2 out of 2 points
Buyer and Seller enter into a written, completely integrated agreement for the sale of 300
“grade A” aluminum gaskets. A dispute arises regarding the meaning of “grade A.” Choose
the best answer:
Selected
Answer: Extrinsic evidence of course of performance will be admissible to explain
the meaning of “grade A.”
Question 16
0 out of 2 points
A “no oral modification clause” is unnecessary in a completely integrated agreement because
any evidence of subsequent modification of a contract will be excluded by the Parol Evidence
Rule.
Selected Answer:
True
Question 17
2 out of 2 points
“A merger clause is a contract provision that seeks to notify the reader that some of the terms
of the agreement must be found in another written agreement.” Is that statement correct?
Selected Answer:
False
Question 18
0 out of 2 points
True or False: Contract interpretation involves a legal determination of the effect given to the
parties’ intent by the applicable governing law, but contract construction is a factual search
for what the parties intended.
Selected Answer:
True
Question 19
Needs Grading
AlphaCo purchases 100 dump truck tires from BetaCo. Prior to the purchase the president of
AlphaCo speaks with BetaCo’s sales representative regarding whether the tires will work well
in the extreme mud conditions where AlphaCo’s trucks frequently work. BetaCo’s sales
representative tells him that the tires are not specifically designed for extreme mud conditions
but that they will “work perfectly in the kind of mud you are describing to me.” BetaCo
claims that the sale of the tires is not subject to an implied warranty of fitness for a particular
purpose. Is BetaCo right? Fully explain your answer, including any rule(s) necessary to
support it.
Selected
Answer: In this situation an implied warranty of merchantability exits. This is a gap
filling in the contract terms. The merchantability of the tires asserts that they are
good for ordinary purposes. The purchaser has reason to know that the tires will
“work perfectly” in the kinds of mud that they described. This establishes the
purpose and the buyer is relying on the judgement of the seller. This could be
disclaimed but it would have to appear expressly in the contract.
Response
Feedback:
[None Given]
Question 20
Needs Grading
AGRO agrees to provide as many bales of “elephant feed” as the Municipal Zoo requires
between January 1 and December 31 at a price of $12 per bale. After performing the contract
for two months, AGRO claims that it is not bound to the contract “because the Zoo is not
obligated under the contract and it is therefore illusory.” Municipal Zoo argues that the
contract is a valid, enforceable requirements contract. Who is right? Fully explain your
answer, including any rule(s) necessary to support it.
Selected
Answer: The agreement is enforceable. This is because good faith is being exercised on
the part of the purchaser (Municipal Zoo). This is known as a requirement
contract in which the needs of the buyer determine the amount purchased. In
this situation the Zoo determines (in good faith) the amount of elephant feed
that will be needed. A reasonable quantity or estimate or historical requirements
can be a consideration in determining good faith.
Response
Feedback:
[None Given]
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