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    Contracts and validity

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    the following is true regarding the defense of Sally and her parents that the car was a necessary?
    The claim will have no effect because the law does not recognize the concept of necessaries when minors are involved.
    Social status is always irrelevant in addressing a claim that an item was a necessary.
    Whether or not parents would buy the item at issue is irrelevant in addressing a claim that an item was a necessary.
    A minor may not disaffirm a contract for a necessary.
    Even if a minor is allowed to disaffirm a contract for a necessary, the minor will still be held liable for the reasonable value of the necessary.
    5. When a contract is voidable, it may be ____________.
    Chargeable
    Rescinded
    Deassented
    Reassented
    Uncharged
    6. In Japan a promise to give property to one party gratuitously cannot be cancelled, regardless of whether or not it is in writing.
    True
    False
    7. Reference - Useless Friend. Charles, who is very gullible, is friends with Bobby. Bobby, who cannot be trusted, decides to try to bind Charles to a contract in Bobby's favor. Bobby has Charles sign a contract promising to wash Bobby's car once a week for a month for $80. The contract incorporated by reference terms on the back. The terms on the back were in very small print and required Charles for one year to cook dinner for Bobby, do his laundry, and clean his apartment. Bobby is also very angry with his former girlfriend, Tessa, and decides to start rumors, that would constitute the tort of defamation, such as that she has a vile disease, cheated on tests, and stole from friends. Bobby wants to enlist the help of Charles but knows that Charles would be hesitant to assist in his endeavors. One evening, however, Charles drank too much beer and was clearly intoxicated - a fact apparent to Bobby. Bobby had him sign a contract agreeing to defame Tessa for $50. When he sobers up, Charles tells Bobby that he was drunk and that he has no intention of defaming Tessa, who also happens to be Charles' new girlfriend. He also finally takes a look at the contract involving work for Bobby and tells Bobby that the contract is outrageous and that he has no intentions of going through with any of it. Which of the following would be a possible defense to Bobby's contract involving chores based upon the small print on the back of the contract?
    Substantive unconscionability
    Unclear drafting
    Procedural unconscionability
    Outrageous wording
    Adhesion conscionability

    10. Reference - Useless Friend. Charles, who is very gullible, is friends with Bobby. Bobby, who cannot be trusted, decides to try to bind Charles to a contract in Bobby's favor. Bobby has Charles sign a contract promising to wash Bobby's car once a week for a month for $80. The contract incorporated by reference terms on the back. The terms on the back were in very small print and required Charles for one year to cook dinner for Bobby, do his laundry, and clean his apartment. Bobby is also very angry with his former girlfriend, Tessa, and decides to start rumors, that would constitute the tort of defamation, such as that she has a vile disease, cheated on tests, and stole from friends. Bobby wants to enlist the help of Charles but knows that Charles would be hesitant to assist in his endeavors. One evening, however, Charles drank too much beer and was clearly intoxicated - a fact apparent to Bobby. Bobby had him sign a contract agreeing to defame Tessa for $50. When he sobers up, Charles tells Bobby that he was drunk and that he has no intention of defaming Tessa, who also happens to be Charles' new girlfriend. He also finally takes a look at the contract involving work for Bobby and tells Bobby that the contract is outrageous and that he has no intentions of going through with any of it. Which of the following is true regarding Charles' claim that he had no obligation to defame Tessa?
    Charles is correct in that he could not be legally obligated to commit defamation.
    Charles is correct only if it can be proven that the defamation would cause Tessa money damages.
    Charles is correct only if it can be proven that the defamation would cause Tessa actual injury.
    Charles is correct only if it can be proven that the defamation is undeserved.
    Charles is correct only if it can be proven that he had a prior relationship with Tessa.
    16. Reference - Beauty Shop Woes. When Janice went to work as a hair stylist in Rick's beauty shop, she entered into an agreement with Rick whereby if she left she would not work for another beauty shop within 50 miles for 2 years. Rick trained Janice in a number of new techniques. After nine months, Janice was offered a great job down the street at a new beauty shop, quit Rick, and had a number of customers follow her down the street to her new job. Rick claimed that she had signed a contract and had no right to go to work at the new shop. Janice disagreed and told Rick that no judge in the country would enforce such an agreement. Janice told Rick that she was more worried about a customer, Treena, who was threatening to sue her because her hair turned green after Janice worked on it. Janice agreed that Treena's hair was damaged. Janice pointed out, however, that she told Treena that odd results could result from a dye attempt, and she required that Treena sign a contract releasing Janice from all liabilities before she did anything with Treena's hair. Treena, however, sued anyway. Which of the following is true regarding Janice's claim that no judge in the country would enforce such an agreement?
    She is correct because such agreements are considered in restraint of trade in every state.
    She is incorrect because such agreements are criminally illegal in every state.
    She is incorrect because while no court would approve a geographical restriction, some courts recognize time restrictions as being valid.
    She is incorrect because all courts approve such agreements so long as it can be shown the employee gained a benefit other than pay from the employment.
    She is incorrect because courts across the country vary in regards to the enforceability of such agreements.
    18. Reference - Useless Friend. Charles, who is very gullible, is friends with Bobby. Bobby, who cannot be trusted, decides to try to bind Charles to a contract in Bobby's favor. Bobby has Charles sign a contract promising to wash Bobby's car once a week for a month for $80. The contract incorporated by reference terms on the back. The terms on the back were in very small print and required Charles for one year to cook dinner for Bobby, do his laundry, and clean his apartment. Bobby is also very angry with his former girlfriend, Tessa, and decides to start rumors, that would constitute the tort of defamation, such as that she has a vile disease, cheated on tests, and stole from friends. Bobby wants to enlist the help of Charles but knows that Charles would be hesitant to assist in his endeavors. One evening, however, Charles drank too much beer and was clearly intoxicated - a fact apparent to Bobby. Bobby had him sign a contract agreeing to defame Tessa for $50. When he sobers up, Charles tells Bobby that he was drunk and that he has no intention of defaming Tessa, who also happens to be Charles' new girlfriend. He also finally takes a look at the contract involving work for Bobby and tells Bobby that the contract is outrageous and that he has no intentions of going through with any of it. Which of the following is true under the Restatement of Contracts, Section 16, regarding the claim of Charles that he should be able to avoid the contract involving Tessa because he was intoxicated?
    Contracts of an intoxicated person are voidable by the intoxicant if the other party had reason to know that because of the intoxicated person's condition, that person was unable to understand the nature and consequences of the transaction or was unable to act in a reasonable manner in relation to the transaction.
    Contracts of an intoxicated person are void if the other party had reason to know that because of the intoxicated person's condition, that person was unable to understand the nature and consequences of the transaction or was unable to act in a reasonable manner in relation to the transaction.
    Contracts of an intoxicated person are enforceable because a person should be bound by his or her actions.
    Contracts of an intoxicated person are void only if it can be proven that the other party was involved in encouraging the abuse of alcohol by the intoxicated person.
    Contracts of an intoxicated person are voidable by the intoxicant only if it can be proven that the other party was involved in encouraging the abuse of alcohol by the intoxicated person.

    21 Reference - Irresponsible Teen. At age 17, in a state in which the age of majority is 18, Sally purchased a prom dress from Formal Stuff. She wore it to the prom and then attempted to return it to the store claiming that she was a minor and that she was entitled to a refund. The dress had clearly been worn and had a purple stain which Sally claimed was from grape juice. Additionally, a few days before she turned 18, Sally purchased a used car from Dings and Dents used cars. She had a deal whereby she paid $100 per month on the car. She drove the car and made payments for fourteen months after she turned 18. Then, she returned the car to Dings and Dents and told them that she wanted all her money back. Dings and Dents claimed the car was a necessity. Sally and her parents claimed that the parents were ready and willing to provide a car to Sally and that she only purchased the car from Dings and Dents because she liked that particular style and color. When purchases of the dress and car were made, the sellers knew that Sally was under the age of 18. In the dispute between Sally and the owner of Dings and Dents, which of the following is true regarding any claim that Sally affirmed the contract?
    So long as, after reaching the age of majority, Sally did not state orally or in writing that she intended to be bound by the contract, then she did not commit the type of express ratification required for her to be bound.
    Sally may have impliedly ratified the contract by making payments for so long after she turned 18.
    An implied ratification occurs when parents agree to accept the debt entered into by a minor.
    If Sally caused any damage whatsoever to the car, she was said to have impliedly ratified the contract.
    Sally was required to expressly ratify the contract before she could be bound to it so long as no damage was done; but if she did any damage to the car, as a matter of law, she is said to have expressly ratified it.

    25. Laura, who has a dress shop, likes a certain style of dress and reaches an agreement with ABC Co., the designer and manufacturer of the dress, that she will purchase all the dresses of that style that ABC Co. can produce for $100 each. Later, ABC Co. learns of Sam, Laura's competitor, who is willing to pay double what Laura agreed to pay for the dresses. ABC Co., attempts to avoid the agreement with Laura on the basis that the agreement with Laura was vague and that consideration was lacking. Which of the following is the most likely result?
    Laura will win on the basis of promissory estoppels.
    Laura will win because she had a valid output contract.
    Laura will win because she had a valid requirement contract.
    ABC Co. will win because the contract with Laura was insufficiently vague.
    ABC Co. will win so long as Laura was given sufficient notice of its decision to enable her to obtain dresses from some other manufacturer.

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    Solution Preview

    5. Rescinded

    6. False

    7. Substantive unconscionability

    10. Charles is correct in that he could not be legally obligated to commit defamation.

    16. She is correct because ...

    Solution Summary

    Contracts and validity are examined.

    $2.19