Questions 1 to 20: Select the best answer to each question. Note that a question and its answers may be split across a page
break, so be sure that you have seen the entire question and all the answers before choosing an answer.
1. Zeke orally agrees to sell six television sets to Molly for $4,000. Zeke then changes his mind and tells Molly the deal is off. Molly sues, claiming breach of contract to sell six television sets for $4,000. Zeke testifies about an oral agreement to sell five television sets to Molly for $4,000. The most likely result is that
A. the court will enforce an agreement to sell five television sets for $4,000.
B. the court will enforce an agreement to sell six television sets for $4,000.
C. there’s no enforceable agreement because oral agreements aren’t enforceable if the parties disagree about the terms.
D. there’s no enforceable agreement; it wasn’t in writing.
2. Carl receives a box of teddy bears in the mail. He didn’t order them and has had no prior dealings with the company. The shipment contains a writing that states that if Carl doesn’t reject the teddy bears and send them back, Carl must pay $129 for the teddy bears. Which of the following statements is true?
A. Carl may keep the bears and do with them as he likes.
B. Carl must pay $129 if he keeps the bears.
C. Carl must ship the bears back only if the sender of the bears prepaid the postage for doing so.
D. Carl either must ship the bears back or pay $129.
3. Mary and George enter a contract in which George agrees to sell Mary vases made in his vase factory in Bedford Falls, New York. Mary lives in Los Angeles, California. The contract expressly states that the sale is F.O.B. (free on board) Los Angeles. The vases are damaged during transport between Bedford Falls and Los Angeles. Who bears the risk of loss?
A. Mary’s insurance carrier
D. Both George and Mary
4. Which of the following constitutes acceptance of goods delivered pursuant to a sales contract?
A. Performing acts that are consistent with the ownership
B. Signify that the goods are conforming
C. Taking physical possession of the goods
D. Rejecting the goods
5. Barbara steals a big plasma television from Abby. Barbara then puts an ad in the classifieds to sell the television. Candy responds to the ad and purchases the television for $2,000. Candy later files bankruptcy and, to raise money to pay Candy’s creditors, the bankruptcy trustee sells Candy’s television at auction to Donna for $1,600. Due to an anonymous tip, the police visit Donna, examine identifying information on the television and tell her it was stolen from Abby. Who now owns this television?
6. Lulu orders 20 pairs of navy blue pants from Peter for $4,000. On receipt of 20 pairs of sky blue pants, Lulu begins offering the pants for sale in her store. After a few days, when no one buys the pants, Lulu ships them back to Peter, claiming that the pants aren’t the color that was specified in the contract and claiming that Peter needs to ship her conforming goods. Peter claims he doesn’t have to do anything and that Lulu owes him $4,000. Which of the following statements is true?
A. Lulu owes Peter $4,000 because the pants approximate what was required under the contract.
B. Lulu owes Peter $4,000 because she accepted the pants.
C. Peter must ship to Lulu 20 pairs of navy blue pants.
D. Lulu owes Peter nothing because she hasn’t accepted the pants until she either pays or signifies that the pants conform to the requirements of the contract.
7. Tom contracts to sell goods to Velia. The contract isn’t C.O.D. and doesn’t provide for payment against a document of title. Tom delivers the goods. Which of the following statements is true?
A. Velia must accept the goods but may inspect before paying.
B. Velia has a right to inspect the goods before accepting or paying for the goods.
C. Velia must pay for the goods but may inspect before accepting.
D. Velia must accept the goods.
8. In August, wholesaler Terrence contracts with retailer Elmer to sell Elmer 500 pairs of blue pants for $5,000 in December. Then, in October, the price of pants drops due to a deal Terrence has made with the manufacturer. Terrence, seeking to get more business from Elmer, agrees in writing to drop the price of the pants due in December from $5,000 to $3,500. Then, in November, the deal Terrence made with the manufacturer falls through, and Terrence calls Elmer and tells him the original price of $5,000 will be charged. Elmer sues, seeking damages based on the lower purchase price. The most likely result is
A. Terrence wins because the price modification was made without Elmer’s consideration.
B. Elmer wins because the modification was effective.
C. the court will award damages based on an average of the two prices.
D. Terrence wins because Elmer originally agreed to $5,000.
9. Lulu orders 20 pairs of navy blue pants from Peter for $4,000, with delivery due no later than November 15. On November 6, Peter phones to say that he won’t deliver the pants because he has gone out of business.
A. Lulu can declare Peter in breach on November 6.
B. Lulu can declare Peter in breach on November 15 if Peter hasn’t delivered the pants.
C. Peter will be in breach only if Lulu is unable to find an alternate supplier who can deliver by November 15.
D. Peter isn’t in breach because going out of business makes it impossible for Peter to perform.
10. Tom agrees to sell 500 pairs of pants to Sally for $5,000. Tom delivers the pants. Sally hands Tom a check. Tom demands cash and refuses to accept the check. Which of the following statements is true?
A. Tom is in breach as the UCC gives him no right to demand cash.
B. Sally will be in breach if she doesn’t immediately give Tom $5,000 in cash.
C. Sally is in breach because Tom is permitted to demand cash.
D. Sally must pay cash but is entitled to a reasonable time to come up with the cash.
11. Lulu orders 20 pairs of navy blue pants from Peter for $4,000, with delivery due on November 15. On November 6, Peter delivers 20 pairs of sky blue pants. Lulu phones Peter and tells him he is in breach because the pants are the wrong color. Which of the following statements is true?
A. Peter has the right to be paid for the pants that were delivered under the doctrine of substantial compliance.
B. Peter has the right to cure the breach by delivering 20 pairs of navy blue pants on or before November 15.
C. Peter is in breach, and the contract is automatically cancelled.
D. Peter is in breach, and Lulu may cancel the contract.
12. Sal, who owns and operates an appliance store, comes to Diana’s house and convinces her to purchase a vacuum cleaner for $50. Two days later, Diana changes her mind. Diana can avoid the contractual obligation under the __________ rule.
C. negative option
13. Dennis contracts with Racketware, Inc., a company in France, to purchase 5,000 tennis rackets. The rackets will be shipped by airplane to a warehouse in New Jersey. Dennis and Racketware enter into a contract on November 1, and the contract identified the rackets being purchased. The airplane containing the rackets leaves France on November 2. The documents necessary to claim the rackets are received by Dennis in the mail on November 3. Dennis claimed the goods at the warehouse on November 4. Dennis acquired an insurable interest in the rackets on what date?
A. November 1
B. November 2
C. November 3
D. November 4
14. Clementine, a debt collector, phones the home of Herschel for the purpose of collecting a debt owed by Herschel. Herschel isn’t at home and Herschel’s wife Edith answers. Clementine tells Edith that Herschel owes $500 on the debt Clementine is trying to collect. Which of the following statements is true?
A. Clementine has violated the Fair Debt Collection Practices Act by telling Edith how much Herschel owes on the debt.
B. Clementine has violated the Fair Debt Collection Practices Act by phoning Herschel’s home.
C. Clementine has violated the Fair Debt Collection Practices Act by communicating by phone rather than in writing.
D. Clementine hasn’t violated the Fair Debt Collection Practices Act.
15. Elmer contracts with Racketware, Inc., a company in France, to purchase 5,000 tennis rackets. The rackets will be shipped by boat to a warehouse in New Jersey. Elmer and Racketware enter into the contract on November 1. The boat containing the rackets leaves France on November 2. The boat containing the rackets sinks on November 3. The documents necessary to claim the rackets are received by Elmer in the mail on November 4. The risk of loss shifted from the seller to the buyer on what date?
A. November 2
B. November 4
C. November 3
D. November 1
16. Jake bought a motorcycle from his neighbor Randy. Randy had owned the motorcycle for his personal
use for about two years. The day after the purchase, Jake is seriously injured after the motorcycle suddenly
veers off of the highway due to a manufacturing defect. Jake brings a strict liability action against Randy.
Jake will most likely lose because the
A. product must be in a defective condition when the defendant sells it.
B. plaintiff must incur physical harm by use of the motorcycle.
C. defendant must normally be engaged in the business of selling or otherwise distributing motorcycles.
D. motorcycle can’t have been substantially changed from the time the product was sold to the time of the injury.
17. At the beginning of November, Bob offered to sell to Sally pants at a price of $20 per pair. Sally said she wanted to see how much shopping traffic her store enjoyed on Black Friday, the day after Thanksgiving, before deciding. Bob agreed in writing to hold the offer open for the rest of the month. Sally had a lot of shoppers come to the store on Black Friday and decided she could sell a lot of pants, so she phoned Bob the next day to order several dozen pairs of pants. Bob told her the offer had been revoked. Sally sues, claiming breach of contract. The most likely result will be that
A. Sally wins because Bob doesn’t have the right to revoke a firm offer.
B. Bob wins because the offer is unenforceable due to lack of consideration.
C. Bob wins because Sally had no right to rely on Bob’s promise.
D. Sally wins because the offer was revoked.
18. Tom contracts with Sarah to sell 500 pairs of pants for $5,000. Tom ships the goods to Sarah via a common carrier. While in transit, the delivery truck drives over a cliff and the pants are destroyed. If the court rules that Sarah bears the loss, which of the following statements must be true?
A. The contract is a shipment contract.
B. The contract is C.O.D.
C. The contract is a destination contract.
D. The contract is F.O.B.
19. Tom wants to change the oil in his automobile, and to do so, he needs to purchase an oil filter. He goes to the auto supply store and tells the clerk that he needs to change the oil in his vehicle and wants an appropriate oil filter for his make and model of vehicle. The clerk recommends oil filter XYZ-2. Tom purchases the oil filter, takes it home, and puts it on his vehicle. The oil filter isn’t suited for the vehicle and, as a result, the vehicle is damaged. Tom can sue successfully based on breach of
A. express warranty.
B. implied warranty of title.
C. implied warranty of merchantability.
D. implied warranty of fitness for a particular purpose.
20. Terra drops off her diamond ring at Jewel’s Jewelry shop to have it cleaned. By mistake, the ring ends up in a display counter and is sold by Jewel to Lulu for $9,000. Terra learns what has happened wants Lulu to give her the ring back. Lulu wants to keep it because she likes it. Which of the following statements is true?
A. Lulu may keep the ring and owes Terra nothing because Lulu is the true owner.
B. Lulu may keep the ring if she pays Terra $9,000.
C. Lulu may keep the ring if she pays Terra the fair value of the ring.
D. Lulu must give the ring to Terra because she is the true owner.