IN-CLASS EXERCISES
Part I: Common Law Contracts
The Agreement .................................................................................................................. 2
Consideration .................................................................................................................... 4
Legality and Capacity ....................................................................................................... 6
Defenses.............................................................................................................................. 8
The Statute of Frauds ..................................................................................................... 10
Third Parties.................................................................................................................... 12
Performance, Completion, and Discharge .................................................................... 14
Breach of Contract and Remedies ................................................................................. 16
Electronic Contracts ....................................................................................................... 18
Part II. The Uniform Commercial Code
The Uniform Commercial Code .................................................................................... 20
Shipping and Delivery Issues ......................................................................................... 22
Performance of UCC Contracts..................................................................................... 24
UCC Remedies ................................................................................................................ 26
Warranties ....................................................................................................................... 28
Part III: Contract Drafting
Contract Drafting Suggestions and Techniques ........................................................... 30
The Final ......................................................................................................................... 32
1
The Agreement
1. Advertisements in the paper or on radio are generally held to be:
A. Offers
B. Acceptances
C. Invitations to negotiate
D. Auctions
2. A contract in which the quantity term is most often unknown yet courts recognize that such
agreements are still generally valid:
A. Counteroffer
B. Output
C. Pledge
D. Reward
3. An auction in which the seller can still refuse to sell to the highest bidder is also known as:
A. Dutch
B. Silent
C. With reserve
D. Without reserve
4. “Agreements to agree” are generally held to be:
A. Valid
B. Void
C. Voidable
D. Binding
5. If party A makes an offer to B but B does not accept and instead makes a counteroffer to A, B is
now the:
A. Offer
B. Offeror
C. Offeree
D. None of the above
6. Which of the following is not an element of a contract?
A. Offer
B. Acceptance
C. Consideration
D. Establishment
7. As a general rule, when a consumer sees the price of a good in the newspaper, this price is
considered a(n):
A. Offer
B. Acceptance
C. Consideration
D. Invitation to negotiate
8. Which of the following is not an example of a valid contract or offer:
A. Requirements contract
B. “Hit” contract
C. Output contract
D. Option contract
2
9. Which of the following is not one way to describe a type of auction:
A. Silent
B. Dutch
C. With reserve
D. Combat to the death
10. Another name for a pledge:
A. Charitable subscription
B. Estimate
C. Letter of intent
D. Preliminary negotiation
11. When one makes an offer to another, they could be characterized as:
A. Offeree
B. Assignee
C. Offeror
D. Recipient
12. “I will buy all the goods that you produce for me”:
A. Requirements contract
B. Output contract
C. Reward offer
D. Statement of intention
13. “I will buy all the goods that I need from you”:
A. Requirements contract
B. Output contract
C. Reward offer
D. Statement of intention
14. When the offeror terminates the ability of the offeree to accept the offer regardless of the reason:
A. Without reserve
B. With reserve
C. Revocation
D. Option contract
15. Renunciation of a contract is (a trick question):
A. Cancellation
B. Termination
C. Breach
D. Voiding
3
Consideration
1. A contract “release” is also known as a(n):
A. Waiver
B. Disclaimer
C. Exculpatory clause
D. All of the above
2. Another way to describe a promise without consideration is:
A. illusory
B. disclaimer
C. accord
D. consideration
3. The “price” of the promise:
A. Consideration
B. Offer
C. Rescission
D. Illusory
4. When party A agrees to waive the debt that B owes him/her even though A did not have to do so
is best known as:
A. Rescission
B. An Accord
C. Forbearance
D. UCC
5. Another name for a settlement of a claim by acceptance less than what was owed:
A. Preexisting duty rule
B. Illusory promise
C. Cancel at any time clause
D. Accord and satisfaction
6. A “bargained-for exchange” in the study of the contract is:
A. Offer
B. Acceptance
C. Consideration
D. Legality
7. When the parties to an agreement decide to part ways and end the agreement:
A. Rescission
B. Unilateral
C. Past consideration
D. Cancel at any time clause
8. When one already has a duty perform and therefore cannot use that as valid consideration for a
future agreement:
A. Preexisting duty rule
B. Past consideration
C. Exculpatory clause
D. Bargained-for-exchange
4
9. Forbearance of performance can be considered as what element of a contract?
A. Offer
B. Acceptance
C. Consideration
D. Legality
10. The UCC is ________ flexible than common law contracts when it comes to the application of
consideration element of a contract involving the sale of goods, especially when it comes to
merchants:
A. More
B. Less
C. Equally
D. Not
11. Which of the following is not normally relevant to a court when determining whether or not there
was valid consideration to modify an agreement as part of the post-contract relationship between
the parties:
A. Fraud
B. Duress
C. Mutual mistake
D. Unilateral misunderstanding
12. One who gives a gift to another may be referred to as:
A. Donee
B. Donor
C. Assignor
D. Delegator
13. The Latin expression ___________________ is another way of saying a bargained-for-exchange
or “something for something”:
A. Quid pro quo
B. Quantum meruit
C. Toppola la dominoes
D. Quasi
14. The following English jurists promoted quid pro nullius or “something for nothing”:
A. Blackstone’s Inn at Courts
B. The Privy Council
C. The Lord Chief Justice
D. Dire Straits
15. Which of the following would not normally be considered a form of consideration:
A. Payment of money for goods or services.
B. Forbearance of an act that one is entitled to do.
C. Giving up one’s time to help another when he or she had no obligation to do so.
D. An arrangement designed to defraud the Government.
5
Legality and Capacity
1. Laws that are designed to protect against lending money at excessive rates of interest are known
as _______________ laws.
A. Usury
B. Disaffirmance
C. Void
D. Sabbath
2. Contracts that restrain trade may violate _____________ laws.
A. Sales
B. Antitrust
C. Wagering
D. Licensing
3. Minors who enter into contracts have the ability to rescind such agreements. This right to rescind
is sometimes referred to as:
A. Disaffirmance
B. Necessaries
C. Covenants not to compete
D. Exculpatory
4. When minors turn 18 years old, they will have _____________ a contract if they do not object to
it prior to turning the age of the majority as a general rule.
A. Emancipated
B. Charged
C. Restored
D. Ratified
5. Items such as food and clothing and medicine are often referred to as ____________ when it
comes to minors having to pay for the reasonable value of their goods or services.
A. Qualified
B. Entitled
C. Necessaries
D. Specialties
6. A contract which is so one-sided that it is would likely be unenforceable by a court might be
characterized as one of ___________:
A. Lucidity
B. Adhesion
C. Malpractice
D. Restitution
7. Minors who have been given the status of an adult for legality purposes might be called:
A. Restitution
B. Emancipated
C. Unconscionable
D. Usury
6
8. Which of the following does not belong with the others?
A. Waiver
B. Disclaimer
C. Release
D. Void
9. It is possible that a person who is incapable of making a contract due to a disease or illness might
actually be held to the promise made in an agreement if the court believes that he or she had a(n)
___________ interval.
A. Void
B. Lucid
C. Usury
D. Unconscionable
10. Sabbath laws that prohibit the sale of certain types of goods or services on a particular day or at a
particular time are sometimes called __________ laws.
A. Green
B. Blue
C. Yellow
D. Orange
11. Placing a party back to the position they were in before they entered into an agreement might be a
remedy known as:
A. Ratification
B. Restitution
C. Usury
D. Capacity
12. Type of contract clause which might prevent, for example, a former partner in a partnership from
opening a similar business down the road as long as a court feels that the clause is reasonable:
A. Price-fixing
B. Noncompete
C. Exculpatory
D. Unconscionable
13. Certain counties in some states prevent the sale of liquor altogether. These are sometimes
described as _______ counties.
A. Wet
B. Timely
C. Stagnant
D. Dry
7
Defenses
1. The phrase, “let the merchant beware” is best characterized as
A. Nudum pactum
B. Caveat vendor
C. Caveat emptor
D. Ignorantia legis non excusat
2. Which one of the following does not represent one of the big three defenses to a contract?
A. Fraud
B. Duress
C. Mutual mistake
D. Conviction
3. Statements made by sellers or salespersons about the quality of the product that are a matter of
opinion, rather than fact, are often protected speech also known as:
A. Puffery
B. Elastic
C. Expertise
D. Misrepresentation
4. When a party claims that they were taken advantage of because of a special relationship of trust
or confidence this may be best described as the defense of:
A. Negligent misrepresentation
B. Mutual mistake
C. Undue influence
D. Adhesion
5. The strongest of all of the defenses to a contract, if proven, is:
A. Fraud
B. Duress
C. Mutual mistake
D. Intoxication
6. “Let the buyer beware” is a phrase that is not as relevant as it used to be with the advent of
numerous consumer protection laws in the United States. This phrase is:
A. Caveat vendor
B. Quid pro quo
C. Caveat emptor
D. Quantum meruit
7. When a party attempts to get out of an otherwise legitimate contract, the party might claim a(n)
_______________ to it for a variety of reasons.
A. Offense
B. Claim
C. Defense
D. Stable
8
8. If one were to threaten you with personal injury in the event you did not sign a contract, such a
threat could be characterized as what defense to a contract?
A. Duress
B. Fraud
C. Puffery
D. Mistake
9. Not normally considered a defense to a contract:
A. Statements of opinion
B. Intoxication
C. Puffery
D. Mutual mistake
10. Which of the following does not belong with the others?
A. Fraud
B. Misrepresentation
C. Fraud in the inducement
D. Puffery
11. “This car is like new” would likely not be an example of:
A. Statement of fact
B. Statement of opinion
C. Puffery
D. Puffing language
12. If you went to get a tattoo that honored your favorite football team and the name was misspelled,
what would be your strongest defense to paying, all things being equal:
A. Bilateral mistake
B. Mistake of law
C. Unilateral mistake
D. Mistake of fact
13. If a salesperson makes a false statement of fact about the quality of a good, but had no intent to
deceive the listener and was simply selling as he or she was trained to do (e.g., Nordstrom’s), the
importance of such lack of intent might demonstrate that which tort is more appropriate, all things
being equal:
A. Fraud
B. Intentional misrepresentation
C. Negligent misrepresentation
D. Fraudulent inducement
14. Which of the following torts would not normally expose someone to punitive damages?
A. Fraud
B. Intentional misrepresentation
C. Negligent misrepresentation
D. Fraudulent inducement.
15. If a car salesperson said, “This car is a 2005” when in fact it was a 2006, this mistake would
likely NOT be protected speech as part of the sale because:
A. It would be considered puffery
B. It would be considered a statement of opinion
C. It would be considered puffing language
D. It would be considered a false statement of fact
9
The Statute of Frauds
1. The statute of frauds as a legal principle that came from which country to the United States:
A. Australia
B. France
C. England
D. Brazil
2. The international version of the Uniform Commercial Code is also known as the:
A. AUCC
B. CISG
C. INCOTERMS
D. FOB
3. Agreements that are enforceable when made prior to a marriage are also known as:
A. Anti-nuptial agreements
B. Suretyship relationships
C. Prenuptial agreements
D. Merger clauses
4. Under the UCC, when the sale of goods occurs there must be evidence of some writing or receipt
which acknowledges that sale if the amount in controversy is at least _________ or more.
A. $1500
B. $2500
C. $5000
D. $500
5. When a lawsuit occurs for a breach of contract, courts generally will listen to oral evidence that
clarifies one or terms of the written agreement so long as the clarification doesn’t contradict the
meaning of the term(s). This principle is also known as the ____________________ rule.
A. Mailbox
B. Parol Evidence
C. Merger
D. Construction
6. When a court believes that an offeror created an ambiguity in an offer or in the contract itself, the
court might construe it against the offeror under what legal doctrine:
A. Contra proferentum
B. Quantum meruit
C. Quasi contract
D. Caveat vendor
7. One who acts as a co-signor might also be called all of the following except:
A. Guarantor
B. Surety
C. Promisor
D. Executor
E. Bonehead
10
8. The original statute of frauds was enacted in what year in England?
A. 1895
B. 1966
C. 1677
D. 1492
9. When a contract references another document such as a deed or a description of property, and this
document is considered outside of the contract itself, good contract drafters might incorporate the
document by ______________.
A. Reference
B. Construction
C. Merger
D. Parol
10. The existence of a contract might be valid under the statute of frauds if it is evidenced by:
A. Email
B. Telefacsimile
C. Invoice
D. All of the above
11. A prenuptial agreement may also be known as a(n) _________________ agreement:
A. Anti-nuptial
B. Ante-nuptial
C. Collective bargaining
D. Merger
12. Which of the following is not a recognized exception to the writing requirement of the statute of
frauds:
A. Admission by the parties
B. Promissory estoppels
C. Full performance by the seller
D. Merger
13. Another name for the parol evidence rule:
A. Four corners rule
B. Five straights rule
C. Merger rule
D. Rule of construction
14. Which of the following rules of construction is correct?
A. Words are to be interpreted in their non-normal capacity
B. Good faith is not implied in most agreements
C. Handwritten words trump typewritten portions of a contract
D. Prior dealings between the parties should not be considered
11
Third Parties
1. A contract for unique talents, abilities or skills is also known as a(n) _____________________
contract.
A. Beneficiary
B. Personal services
C. Privity
D. Assignment
2. One assigns rights to a contract. However, one may also ___________ duties in a contract.
A. Assign
B. Offer
C. Remand
D. Delegate
3. The concept in which a consumer could only sue the retailer of a defective product was known as
______________________ though that concept is diluted considerably today under product
liability laws:
A. Incidental beneficiary
B. Privity of contract
C. Distribution of goods
D. Personal services
4. A life insurance contract in which the beneficiary is named to the contract is known as what type
of third party agreement?
A. Incidental beneficiary
B. Intended beneficiary
C. Delegation beneficiary
D. Assignment beneficiary
5. One may not delegate certain responsibilities to a contract. Non delegable duties include all of the
following EXCEPT:
A. Personal services contracts
B. When a contract prohibits it
C. When it is against public policy
D. Non-specialized building tasks
6. When a bank sells a loan to another bank so that it can gain cash on hand (called “factoring”), the
act of selling the loan would best be characterized as a(n):
A. Delegation
B. Assignment
C. Incidental beneficiary
D. Personal services
7. When a person buys life insurance, the beneficiary of the policy would normally be characterized
as a(n):
A. Intended beneficiary
B. Incidental beneficiary
C. Assignor
D. Delegator
12
8. When a builder of a house subcontracts with contractors such as plumbers, electricians and so on,
the relationship would be best characterized as a(n) ___________ type of relationship.
A. Assignment
B. Delegation
C. Personal services
D. Employment
9. The assignment of a patent is governed by _______ law.
A. Local
B. State
C. Federal
D. County
10. Good contract drafters could avoid an assignment of a contract by placing a(n) ____________
clause in the agreement.
A. Non-assignment
B. No compete
C. Merger
D. ADR
11. Which of the following occupations are the least unique, all things being equal, when it comes to
the issue of whether the activity would be a personal service contract?
A. Lawyer
B. Musician
C. Athlete
D. Dry wall painter
12. Which of the following does not prevent an assignment of rights:
A. If a statute prohibits it
B. If it is against public policy
C. If a contract prohibits it
D. If a contract specifically allows for it
13. The one to whom a responsibility is delegated is known as the:
A. Delegatee
B. Delegator
C. Donor
D. Donee
14. One who is not in privity of contract, but who is entitled to a benefit of some sort, is a:
A. Mentor
B. Third-party Beneficiary
C. Fourth party
D. Donor
13
Performance, Completion, and Discharge of Contracts
1. When the parties to a contract have completed their contractual responsibilities, this is known as a
_____________ of duties.
A. Condition
B. Rescission
C. Discharge
D. Liquidation
2. When one purchases a product from a local retail store, the duty to pay arises at the same time the
duty to hand over the goods to the customer. This type of condition is best characterized as a
condition ________________
A. Precedent
B. Subsequent
C. Concurrent
D. Qualified
3. When one breaches a contract, one of the considerations for a court might be whether the
breaching party acted in good faith. If performance of the contract is not substantial, then a breach
of the contract might be considered ______________.
A. Immaterial
B. Material
C. Mitigation
D. Complete
4. Bankruptcy allows a debtor to avoid paying certain debtors. For individual debtors, what chapter
of the U.S. Bankruptcy Code applies to work out debts without liquidating assets?
A. Chapter 9
B. Chapter 11
C. Chapter 7
D. Chapter 13
5. The amount of time that one has to bring a lawsuit whether in contract law or in tort law is
referred to as a statute of ____________
A. Limitations
B. Frauds
C. Remittance
D. Impracticability
6. When the parties to a contract agree to settle the amount for less than what was owed in the
agreement may be referred to as:
A. Accord and satisfaction
B. Unilateral alteration
C. Condition
D. Petition
7. If one party to an agreement believes that the other party may not perform, this concern could
result in a written request that assuring that the party will perform in what is known as a(n):
A. Hazardous activity clause
B. Adequate assurance of performance
C. Condition concurrent
D. Statute of limitations
14
8. If a party does not receive a written or other adequate assurance of performance from the other
party, one might legitimately breach the contract under the legal doctrine known as:
A. Impossibility of performance
B. Temporary impossibility
C. Anticipatory repudiation
D. Liquidation
9. If parties decide that a contract does not suit their needs, they might illegitimately try to modify it
without the another party’s permission in what is known as:
A. Unilateral alteration
B. Novation
C. Preferential transfer
D. Discharge
10. If one comes to court and asks a judge to provide him or her with a remedy for an alleged breach
of contract, the party had better come with:
A. Unclean hands
B. Clean hands
C. A well-groomed appearance
D. A Trustee
11. When a breach of contract occurs, the non-breaching party must not make matters any worse
under the concept of ____________ :
A. Mitigation of damages
B. Litigation
C. Consternation
D. Ratification
12. If a person buys a building on the condition that the zoning remains the same for at least one year,
otherwise the contract may be later undone, this condition may be best described as a condition
______________.
A. Concurrent
B. Subsequent
C. Contemporaneous
D. Impracticable
13. Most contracts are discharged by:
A. Performance
B. Bankruptcy
C. Rescission
D. Novation
14. Weather issues or other “Acts of God” clauses might be characterized as:
A. Force majeure
B. Hazardous activity
C. Condition subsequent
D. Anticipatory repudiation
15
Breach of Contract and Remedies
1. If a court were to order that one of the parties to an agreement actually return the goods or the
value of the services to the non-breaching party, this might be best characterized as:
A. Damages
B. Rescission
C. Restitution
D. Specific performance
2. Which of the following remedies is not normally available for personal services contracts:
A. Rescission
B. Restitution
C. Specific performance
D. Reformation
3. When party A and party B agree to the damages for a breach of contract and have it written into
the contract itself (for late performance or delivery, for example) such damages often are referred
to as _______________.
A. Punitive
B. Compensatory
C. Consequential
D. Liquidated
4. Which of the following types of damages are not allowed for a breach of contract:
A. Punitive
B. Compensatory
C. Consequential
D. Liquidated
5. When a breach of contract occurs, the non-breaching party has a duty to keep the damages as
minimal as possible. This concept is referred to as the duty to ____________ damages.
A. Mitigate
B. Litigate
C. Compensate
D. Lessen
6. Actual out-of-pocket losses that a business might suffer due to another’s decision to breach a
contract one month early might be characterized as ______________ damages.
A. Liquidated
B. Compensatory
C. Punitive or exemplary
D. Special
7. Lost profits which could have been recovered had a breaching party performed as they had
promised might be characterized as what type of damages?
A. Liquidated
B. Consequential
C. Punitive
D. Natural
16
8. Party A and party B agree that in the event of a breach of contract due to a delay in delivery of the
goods, B will compensate A in the amount of $100 per day for each day late. These damages
could be characterized as:
A. Liquidated
B. Compensatory
C. Punitive
D. Special
9. A tenant decides to break his contract with the landlord about three months too soon. The
landlord has a duty to at least try to find another tenant to replace the breaching tenant so that
matters do not get any worse. This could be characterized as the duty to:
A. Waive
B. Litigate
C. Adjudicate
D. Act in good faith
10. When both parties agree that their contractual relationship is simply not working, one of the
contract remedies that would clearly end the relationship would be:
A. Reformation
B. Specific performance
C. Liquidated damages
D. Rescission
11. If a court believes that one party is charging another party an excessive rate of interest in a loan,
for example, rather than declare the contract void the court could lower the interest rate while at
the same time keeping the contract intact. This could be best described as what type of remedy?
A. Reformation
B. Accord and satisfaction
C. Liquidated damages
D. Compensatory damages
12. If a party to an agreement accepts less money from the debtor than what is legally owed to them,
such acceptance could be characterized as a(n):
A. Restitution
B. Reformation
C. Waiver
D. Special damages
13. When a court orders someone to perform as agreed, such a contract remedy is referred to as
_______________ performance.
A. Punitive
B. Special
C. Specific
D. Unique
14. Damages that are not available to a party in a breach of contract claim, but are possibly available
in a tort action:
A. Punitive
B. Compensatory
C. Consequential
D. Liquidated
17
Electronic Contracts
1. When one sees an agreement online which requires acknowledging the terms of an agreement on
a website by selecting I AGREE or I DECLINE, this is often referred to as a _____________
agreement.
A. Click-on
B. Shrink-wrap
C. Mass-market
D. Attribution
2. One of the most important contract clauses found in an online agreement would be a
_____________ clause especially since the parties to a contract might be thousands of miles
apart.
A. Liquidated damages
B. Choice of law or Forum selection
C. Merger
D. Stipulation
3. The uniform act that was drafted relates to electronic forms and transactions:
A. UAAA
B. URLTA
C. UCITA
D. UETA
4. The granting of the right to use one’s computer software, usually for a fee is known as a
__________________.
A. Cybernotary
B. License
C. Profit
D. Signature
5. An example of an E-contract that is presented with a package of computer information as a
standard form (boilerplate) agreement and most often the same for every potential customer:
A. MLM
B. Shrink-wrap license
C. LMM
D. MMM
6. When a computer user sees “I AGREE” as part of the software terms and conditions, such a
button is best described as a(n) _____________ agreement.
A. Usurious
B. Elective or “click-on”
C. Partnering
D. E-SIGN
7. A type of contract clause that is quite appropriate to consider in electronic contracts is the ______
clause since it encourages use of means other than litigation to resolve disputes.
A. ABC
B. ADR
C. ADU
D. ABD
18
8. “Mini click-on” agreements might also be termed:
A. Browse-wrap
B. UCITA
C. UETA
D. NCCUSL
9. One who grants a license to use software might be referred to as the __________.
A. Licensee
B. End-user
C. Licensor
D. License
10. A person who verifies the signature of someone involved in E-commerce could be characterized
as a(n):
A. Licensor
B. End-user
C. MML
D. Cybernotary
11. The use of a user name and a password to verify that persons sending an electronic record are
who they say they are might be known as:
A. Attribution
B. MML
C. License
D. Shrink-wrap
12. E-SIGN was enacted in what year in order to promote commerce over the Internet.
A. 1990
B. 1995
C. 2000
D. 2005
13. The statement, “User hereby agrees to settle any and all claims in the courts of Virginia using
Virginia law” could be best described as a(n) _____________ clause.
A. ADR
B. Forum-selection
C. Liquidated damages
D. UETA
14. Internet banking agreements which establish that customers must complete various steps, for
example, in order to create the online relationship might be best described as a(n)
_________________ agreement.
A. Cybernotary
B. UCITA
C. Partnering
D. Financing
19
Uniform Commercial Code
1. The UCC was drafted and originally adopted in what decade?
A. 1950’s
B. 1960’s
C. 1970’s
D. 1980’s
2. The article of the UCC that deals with the leases of goods as opposed to sales of goods:
A. 2
B. 2A
C. 6
D. 9
3. According to the UCC, a person who regularly deals in the kinds of goods involved in a sales
contract is referred to as a:
A. Buyer
B. Retailer
C. Seller
D. Merchant
4. When a sale of both a good and a service is combined, this mixed contract might also be best
referred to as a(n) _____________ contract.
A. Implied
B. Express
C. Hybrid
D. Quasi
5. The 2003 amended version of the UCC increased the dollar amount which required evidence of a
writing (i.e., record) of the sales of goods. This amount was raised to:
A. $500
B. $5000
C. $2500
D. $1500
6. While all states have adopted the UCC, this state has not adopted it in its entirety due to its unique
legal history:
A. Louisiana
B. Texas
C. Arkansas
D. Georgia
7. The Article of the UCC that governs the sale of goods:
A. 2
B. 2A
C. 2B
D. 3
20
8. Many UCC contracts are described as _____________ and they are often standard form contracts.
A. Official
B. Contemplated
C. Boilerplate
D. Justified
9. The term “cure” is associated primarily with:
A. Buyers
B. Sellers
C. Owners
D. Donors
10. A “firm offer” is an offer that is most likely _______________.
A. Revocable
B. Sustainable
C. Irrevocable
D. Standard
11. Which of the following persons are most likely to make a firm offer due to their special status and
experience involving the sale of goods:
A. Merchants
B. Buyers
C. Sellers
D. Donors
12. The UCC is made up of how many total Articles?
A. 11
B. 14
C. 8
D. 15
13. Which of the following does not belong with the others when associated with the specific term
“merchant” in the stream of commerce?
A. Retailer
B. Wholesaler
C. Manufacturer
D. Offeror
14. Which organization primarily assisted in drafting the UCC?
A. ALI or American Law Institute
B. BMI
C. CMU
D. AUCC
15. For a breach of contract under the UCC, how long is the statute of limitations in years?
A. 2
B. 4
C. 6
D. 8
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Shipping and Delivery Issues
1. When a seller of goods delivers goods to a buyer, the seller usually enlists the help of a(n):
A. Recipient
B. Carrier
C. Consignor
D. Air bill of lading
2. A shipment contract which has a specific geographic location (such as a city or county)
associated with it where the risk of loss would then change to the buyer would most likely use
which abbreviation:
A. F.O.B.
B. F.A.S.
C. C.I.F.
D. Ex-Ship
3. Which of the following documents of title is not normally associated with the sale of goods in
some way:
A. Bill of lading
B. Air bill of lading
C. Warehouse receipt
D. Warranty deed
4. When one delivers possession of personal property but does not convey title, this can be referred
to as a(n):
A. Sale
B. Bailment
C. Lease
D. Insurable interest
5. When a seller of goods allows a buyer to use goods on a trial basis first, this type of sale is
referred to as a:
A. Sale on approval
B. Sale or return
C. Consignment sale
D. Shipment sale
6. Another name for a special type of bill of lading:
A. Airway
B. Wayside
C. Air bill of lading
D. Bailor
7. When possession of goods is given to another with the expectation that the goods will be returned
in the same (or better) condition is known as a(n) _________________?
A. Bailment
B. Bail
C. Title
D. Airbill of lading
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8. When one entrusts another with goods with the expectation that the goods will be sold, such a
relationship is often characterized as a(n):
A. INCOTERMS
B. Risk of loss
C. Consignment
D. Warehouse receipt
9. Which of the following is not normally considered a fungible good?
A. Wheat
B. Wine
C. Oil
D. Painting
10. When title to goods passes once the goods are delivered to the buyer, such a contract is often
referred to as a(n) _____________ contract.
A. Warehouse
B. Recipient
C. Output
D. Destination
11. A conditional sale in which the buyer who intends to resell the goods to another has the right
to return the goods to the seller usually within a specific amount of time is specifically
referred to as a(n) ________________:
A. Sale or return
B. Sale on approval
C. CIF sale
D. Return of goods
12. One who receives bailed goods:
A. Donor
B. Bailee
C. Bailor
D. Consignor
13. Which of the following goods is not normally associated in a bailment relationship?
A. Valet parking
B. Dry cleaning clothes
C. Coat checks at restaurants
D. Apples and oranges
14. The only way that one can purchase insurance on the delivery of goods is if one of the parties
has a(n): ____________________ in the goods.
A. Bailment
B. Consignment
C. Insurable interest
D. Bill of lading
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Performance of UCC Contracts
1. When a seller of goods delivers nonconforming goods, the UCC allows the seller a
chance to repair, adjust or replace the delivery. This concept is known as:
A. Cover
B. Cure
C. Curse
D. Withhold
2. When one of the parties to an agreement believes that the other party might not perform
and therefore breach, the non-breaching party may thereafter ask for-in writing-a(n):
A. C.O.D.
B. Commercial impracticability
C. Anticipatory repudiation
D. Adequate assurance of performance
3. For international transactions between parties who might have not done business with
each other before, which of the following documents might be helpful:
A. Letter of credit
B. Perfect tender
C. Bill of lading
D. F.O.B.
4. When an unforeseen event occurs that makes delivery of goods extremely difficulty, this
may be referred to as:
A. Commercially impracticable
B. Substantial impairment
C. Adequate assurance of performance
D. Installment contract
5. Goods which meet the exact specifications of a buyer’s order would be characterized as:
A. Conforming
B. C.O.D.
C. Good faith
D. Force majeure
6. The common law contract rule which required that the exact goods must be delivered in
the exact time in the exact order and manner is called the ___________ rule and has been
replaced by the much more flexible UCC policy to promote commerce.
A. Perfect tender
B. Sales contract
C. Moderate sales
D. Substantially impair
7. The UCC allows a buyer to accept non-conforming goods in order to:
A. Promote commerce
B. Mitigate damages
C. Prevent unjust enrichment
D. Allow for accommodation
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8. When a seller requires that the buyer pay for the goods before being able to open the box,
such a transaction is referred as a sale:
A. F.A.S.
B. F.O.B.
C. C.O.D.
D. C.I.F.
9. Payment terms of 2/10 net 30 allow for how much of a discount if the goods are paid for
in full within 10 days?
A. Two percent
B. Three percent
C. Four percent
D. Five percent
10. A letter of credit involves an account party, a beneficiary and what other type of party
which is usually a bank:
A. Issuer
B. Donor
C. Incidental
D. Buyer
11. An important duty between a Buyer and Seller involving the sale of goods :
A. Cooperation
B. Litigation
C. Bad faith
D. Impairment
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UCC Remedies
1. Laws designed to protect consumers against unfair or deceptive practices especially in the
sale of motor vehicles might be characterized as:
A. Peach
B. Apple
C. Lemon
D. Banana
2. If a buyer of goods breaches the contract and the seller must attempt to resell the goods,
the seller must first give the buyer _______________ notice, all things being equal:
A. Reasonable
B. Definite
C. Certain
D. Imperative
3. If a seller of goods breaches a contract, a buyer may consider all of the following possible
remedies except:
A. Canceling the contract
B. Rejecting the goods
C. Covering with substitute goods
D. Commission of a crime
4. Agreed-upon damages may also be known as:
A. Accepted
B. Mandatory
C. Liquidated
D. Compensated
5. Lost profits would likely be an example of what type of damages involving a transaction
between a Buyer and Seller of goods?
A. Punitive
B. Compensatory
C. Consequential
D. Special
6. The UCC only comes into play with regard to remedies unless the parties have:
A. Otherwise agreed
B. Thoroughly discussed
C. Admitted in court
D. Disagreed
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7. If a Seller wants to resell goods that were originally intended for the Buyer who has
breached, the Seller still must give the Buyer ______________ notice.
A. Express
B. Implied
C. Reasonable
D. Subjective
8. If a Buyer rejects goods after a Seller breaches the contract, the Seller must be notified:
A. Seasonably
B. Objectively
C. Maturely
D. Impliedly
9. When calculating damages, another way to characterize the current market price for the
goods might be referred to as:
A. CISG
B. Fair market value
C. “AS IS”
D. Substantially impair
10. An example of a court order known as an injunction:
A. Conjunction
B. Advocacy
C. Novation
D. Specific performance
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Warranties
1. Which of the following warranties automatically runs with the sale of a good that a buyer
purchases from a local retail store?
A. Express
B. Implied warranty of merchantability
C. Implied warranty of fitness for a particular purpose
D. Extended warranty
2. Which of the following warranties represent an affirmative statement made by the seller
or manufacturer in which they stand behind the quality of their product usually for a
specific amount of time after the sale?
A. Express
B. Implied warranty of merchantability
C. Implied warranty of fitness for a particular purpose
D. Extended warranty
3. Which of the following warranties may a buyer purchase for a fee to extend the warranty
of a product beyond the time limitation for the repair or replacing of the goods?
A. Express
B. Implied
C. Extended
D. Quasi
4. The federal act which relates to the enforcement of consumer transactions involved in the
sale of goods, also known as the federal lemon law:
A. Sherman
B. Clayton
C. Magnuson-Moss
D. Title IX
5. When a seller knows the particular or peculiar reason that the buyer will use or needs the
goods, and the buyer relies on the sellers skill, experience or knowledge as part of the
deal, the warranty that would most likely apply in this situation is:
A. Extended warranty
B. Implied warranty of merchantability
C. Implied warranty of fitness for a particular purpose
D. Express warranty
6. As a general rule, product warranties impose more obligations on Sellers than
___________.
A. Buyers
B. Owners
C. Renters
D. Contractors
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7. The type of warranty that is often purchased as a separate contract by the Buyer as part
of the sale of a good:
A. Quasi
B. Extended
C. Lien
D. Implied
8. The type of warranty that automatically passes with a sale of a good to a buyer:
A. Title
B. Express
C. Lien
D. Third party
9. Statements of opinion are not statements of fact and, therefore, such statements would
likely be considered _____________ and as part of the art of a sale:
A. Established
B. Common
C. Extended
D. Puffery
10. Third parties could also be characterized as __________________ especially if they are
not part of the original purchase of the good, but they are using the product:
A. Remote or third-party purchasers
B. Informed buyers
C. Established contacts
D. Educated customers
11. Which federal administrative agency is in charge of enforcing the Magnuson-Moss
Warranty Act:
A. FDA
B. FCC
C. FTC
D. OSHA
12. Multi-level marketing organizations often involve a pyramid-like structure as part of the
sale of goods. Which of the following organizations is not an example of a multi-level
marketing (MLM) organization:
A. Avon
B. Amway
C. Hertz
D. Mary Kay Cosmetics
13. A manufacturer’s warranty is considered _____________ if it is anything other than a
full warranty. It must be conspicuous as well.
A. Lifetime
B. Extended
C. Special
D. Limited
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Contract Drafting
1. Special lawyer language that many non-lawyers do not understand is also known as:
A. Lawyer language
B. Legalese
C. Old English
D. SEC
2. The federal administrative agency which established a plain English rule for insurance
contracts in 1998:
A. FTC
B. FCC
C. SEC
D. MAC
3. The contract clause that is particularly important to consider especially in the event bad
weather might frustrate the purpose of the agreement and necessitate a breach:
A. Merger
B. Venue
C. Force majeure
D. Arbitration
4. The contract clause which denotes that the written agreement represents the complete and
entire agreement between the parties:
A. Exclusivity
B. Assignment
C. Liquidated damages
D. Merger
5. An important contract clause which geographic or physical address where the parties to
the contract must go in the event of a dispute:
A. Venue
B. Severability
C. Arbitration
D. Testimonium
6. In older contracts, documents or deeds, one might see the abbreviation _____ which
stands for the place where the seal or signature would go.
A. R.I.
B. L.S.
C. D.R.
D. M.O.
7. If a contracting party attempts to enforce a contract obtained by bad faith, the contract
may be voidable based on a concept called:
A. Unclean hands
B. Fraud in the inducement
C. Failure of consideration
D. Incapacity
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8. When a state or federal law declares that certain parts of a contract must be obvious,
stand out, or have a certain size of font, such words must therefore be:
A. Conspicuous
B. Ambiguous
C. Slang
D. Integrated
9. Another name for a merger clause:
A. Integration clause
B. Hazardous activity clause
C. Force majeure clause
D. Liquidated damages clause
10. A clause that a contract drafter should put in the agreement to emphasize that timely
performance of the agreement is very important might be best described as a(n)
_________________ clause:
A. ADR
B. Termination
C. Time is of the essence
D. Incorporation by reference
11. A clause in an agreement which emphasizes that certain trade secrets cannot be revealed
to competitors could be characterized as a(n) ___________ clause.
A. Exclusivity
B. Law
C. Modification
D. Confidentiality
12. The three R’s of contract drafting:
A. Rescission, Repudiation, Renunciation
B. Redress, Reproving, Respondent
C. Redundant, Repugnant, Reprehensible
D. Retire, Restore, Repent
13. In the event of a dispute over a contract, a contract drafter might include which of the
following clauses to emphasize the physical or geographic location of where the parties should do
business:
A. Venue
B. Assignment and Delegation
C. Attorney’s fees
D. Modification
14. The most important clause that relates to ending the contractual relationship can be
referred to as ________________ :
A. ADR
B. Incorporation by reference
C. Termination
D. Liquidation
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The Final
1. The concept that two or more parties can agree on anything they want as long as it is legal, and
such an enforceable agreement will be upheld by a court is best known as:
A. Benefit of the bargain
B. Implied contract
C. Freedom of contract
D. Breach of contract
2. An addendum to a contract is also known as a(n)
A. Rider
B. Bilateral
C. Formal
D. Void
3. The phrase, “as much as he or she deserved” comes from the Latin expression:
A. Caveat emptor
B. Pacta sunt servanda
C. Quantum meruit
D. Promissory estoppel
4. American jurisprudence comes primarily from which country?
A. England
B. France
C. Rome
D. Canada
5. When a court is later called upon to determine the existence of a contract or interpret an
agreement, which theory do courts use in their analysis?
A. Unauthorized practice of law
B. Subjective theory of contracts
C. Collective bargaining agreement
D. Objective theory of contracts
6. When the parties to a contract exchange promises to perform, this is best known as:
A. Bilateral contract
B. Unilateral contract
C. Condition
D. Waiver
7. The contract which establishes the rights and responsibilities between management and labor is
best known as:
A. Beneficiary Agreement
B. Declaration of War
C. Collective Bargaining Agreement
D. Project Labor Agreement
8. Another name for the phrase “promissory estoppel” is:
A. Four corners rule
B. Plain meaning rule
C. Detrimental reliance
D. Parol evidence
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9. Contracts that are fully performed in that both parties have completed what they promised to do
are often characterized as:
A. Express
B. Executed
C. Executory
D. Voidable
10. A contract which requires a well-established and step-by-step process for formation including
possibly a seal of some sort might be called:
A. Informal
B. Implied
C. Formal
D. Void
11. The following phrase was established in the English case involving a mutual mistake involving a
ship known as the Peerless:
A. Benefit of the bargain
B. Bilateral
C. Meeting of the minds
D. Pacta sunt servanda
12. Contracts which require unique talents, abilities and skills by one of the parties might be called:
A. Personal services
B. Quantum meruit
C. Implied
D. Unjust
13. When a court looks to the particular words found in a written contract, courts will not try to
interpret what the parties might have meant. This is referred to as:
A. Uniform Commercial Code
B. Nudum pactum
C. Formal
D. Plain meaning rule
14. An illusory promise is one which really cannot be enforced because it is overly vague. This can
be characterized as:
A. Quantum meruit
B. Nudum pactum
C. Promissory estoppel
D. Pacta sunt servanda
15. The concept that certain types of agreements must be in writing:
A. Uniform Commercial Code
B. Statute of frauds
C. Quasi contract
D. Four corners rule
33