BUL 5810 EXAMS 3 ALL ANSWERS AND QUESTIONS
SET A+
✔✔What are the elements of consideration (the inducement to enter into a contract)? -
✔✔Legal sufficiency and bargained-for exchange.
✔✔Legal sufficiency consists of: - ✔✔either a benefit to the promisor or a detriment to
the promisee.
✔✔Obtaining something to which one had no prior legal right is a: - ✔✔legal benefit
✔✔Doing an act one is not legally obligated to do or not doing an act that one has a
legal right to do is a: - ✔✔legal detriment
✔✔Adequacy is not required where: - ✔✔the parties have freely agreed to the
exchange.
✔✔An illusory promise is: - ✔✔a promise that imposes no obligation on the promisor.
✔✔The following promises are NOT illusory: - ✔✔1. Output Contract - agreement to sell
all of one's production to a single buyer
2. Requirements Contract - agreement to buy all of one's needs from a single producer
3. Exclusive Dealing Contract - grant to a franchisee or licensee by a manufacturer of
the sole right to sell goods in a defined market
4. Conditional Promise - a contract in which the obligations are contingent upon the
occurrence of a stated event
✔✔T or F: Public duties such as those imposed by tort or criminal law are neither a
legal detriment nor a legal benefit. - ✔✔True
✔✔T or F: Performance of a preexisting contractual duty is consideration. - ✔✔False; is
NOT
, ✔✔Under the common law, a modification of a preexisting contract must be supported
by: - ✔✔Mutual consideration; under the Code, a contract can be modified without new
consideration.
✔✔In the case of substituted contracts: - ✔✔The parties agree to rescind their original
contract and to enter into a new one; rescission and new contract are supported by
consideration.
✔✔T or F: Payment of a lesser sum of money to discharge an UNDISPUTED debt (one
whose existence or amount is not contested) constitutes legally sufficient consideration.
- ✔✔False; does NOT constitute legally sufficient consideration
✔✔T or F: Payment of a lesser sum of money to discharge a DISPUTED debt (one
whose existence or amount is contested) is legally sufficient consideration. - ✔✔True
✔✔Bargained-for exchange is defined as: - ✔✔a mutually agreed-upon exchange.
✔✔T or F: An act done before the contract is made is not consideration. - ✔✔True
✔✔T or F: Consideration to support a promise may NOT be given to a person other
than the promisor. - ✔✔False
✔✔In the case of a promise to pay a debt barred by the statute of limitations: - ✔✔a
new promise by the debtor to pay the debt renews the running of the statute for a
second statutory period.
✔✔A promise to pay a debt discharged in bankruptcy: - ✔✔may be enforceable without
consideration.
✔✔A new promise to perform a voidable obligation that has not been previously
avoided is ____________________. - ✔✔enforceable
✔✔A promise made to satisfy a preexisting moral obligation is generally
____________________ for lack of consideration - ✔✔unenforceable
✔✔The doctrine that prohibits a party from denying her promise when the promisee
takes action or forbearance to his detriment reasonably based upon the promise is: -
✔✔Promissory Estoppel
✔✔When promises are made under seal: - ✔✔the seal acts as a substitute for
consideration, provided that the seal is still recognized.
SET A+
✔✔What are the elements of consideration (the inducement to enter into a contract)? -
✔✔Legal sufficiency and bargained-for exchange.
✔✔Legal sufficiency consists of: - ✔✔either a benefit to the promisor or a detriment to
the promisee.
✔✔Obtaining something to which one had no prior legal right is a: - ✔✔legal benefit
✔✔Doing an act one is not legally obligated to do or not doing an act that one has a
legal right to do is a: - ✔✔legal detriment
✔✔Adequacy is not required where: - ✔✔the parties have freely agreed to the
exchange.
✔✔An illusory promise is: - ✔✔a promise that imposes no obligation on the promisor.
✔✔The following promises are NOT illusory: - ✔✔1. Output Contract - agreement to sell
all of one's production to a single buyer
2. Requirements Contract - agreement to buy all of one's needs from a single producer
3. Exclusive Dealing Contract - grant to a franchisee or licensee by a manufacturer of
the sole right to sell goods in a defined market
4. Conditional Promise - a contract in which the obligations are contingent upon the
occurrence of a stated event
✔✔T or F: Public duties such as those imposed by tort or criminal law are neither a
legal detriment nor a legal benefit. - ✔✔True
✔✔T or F: Performance of a preexisting contractual duty is consideration. - ✔✔False; is
NOT
, ✔✔Under the common law, a modification of a preexisting contract must be supported
by: - ✔✔Mutual consideration; under the Code, a contract can be modified without new
consideration.
✔✔In the case of substituted contracts: - ✔✔The parties agree to rescind their original
contract and to enter into a new one; rescission and new contract are supported by
consideration.
✔✔T or F: Payment of a lesser sum of money to discharge an UNDISPUTED debt (one
whose existence or amount is not contested) constitutes legally sufficient consideration.
- ✔✔False; does NOT constitute legally sufficient consideration
✔✔T or F: Payment of a lesser sum of money to discharge a DISPUTED debt (one
whose existence or amount is contested) is legally sufficient consideration. - ✔✔True
✔✔Bargained-for exchange is defined as: - ✔✔a mutually agreed-upon exchange.
✔✔T or F: An act done before the contract is made is not consideration. - ✔✔True
✔✔T or F: Consideration to support a promise may NOT be given to a person other
than the promisor. - ✔✔False
✔✔In the case of a promise to pay a debt barred by the statute of limitations: - ✔✔a
new promise by the debtor to pay the debt renews the running of the statute for a
second statutory period.
✔✔A promise to pay a debt discharged in bankruptcy: - ✔✔may be enforceable without
consideration.
✔✔A new promise to perform a voidable obligation that has not been previously
avoided is ____________________. - ✔✔enforceable
✔✔A promise made to satisfy a preexisting moral obligation is generally
____________________ for lack of consideration - ✔✔unenforceable
✔✔The doctrine that prohibits a party from denying her promise when the promisee
takes action or forbearance to his detriment reasonably based upon the promise is: -
✔✔Promissory Estoppel
✔✔When promises are made under seal: - ✔✔the seal acts as a substitute for
consideration, provided that the seal is still recognized.
