LOMA 311 EXAM QUESTIONS WITH
CORRECT DETAILED ANSWERS
(100% CORRECT)
Freedom of Contract - Answer-States that parties have the right to contract with
whomever they choose and on whatever lawful terms they choose. Under this principle,
the offeror controls the offer and has the right to decide with whom he or she will
contract.
Consideration - Answer-Whatever a promisor asks for and receives in exchange for his
contractual promise. This is legally adequate if it was bargained for and exchanged
between the parties.
Disaffirmance - Answer-A minor's exercise of his right to avoid a contract.
Necessaries - Answer-Goods and services that a minor or other incapacitated person
actually requires to sustain her well-being.
Void Contract - Answer-An agreement that was never enforceable by law because the
parties did not create a contract.
Voidable Contract - Answer-A party has the right to avoid her obligations under the
contract without incurring legal liability.
Accord and Satisfaction - Answer-One party agrees to accept something other than
what he or she was entitled to receive under the original contract as a method of
discharging the contract
Statute of Frauds - Answer-A law that declares certain types of contracts to be
unenforceable unless they are evidenced by a written document signed by the party to
be discharged without performing the contract.
Rule of Contra Proferentem - Answer-The rule that courts will construe unclear or
ambiguous language against the party who drafted or prepared a written contract,
unless the use of unclear language was required by law.
Parol Evidence Rule - Answer-States that parol evidence is not admissible to add to,
vary, or contradict the terms of a written contract.
Parol Evdience - Answer-Evidence that is outside of a written agreement.
,Agent - Answer-A party who is authorized by another party, the principal, to act on the
principal's behalf.
Agency - Answer-The legal relationship between the agent and the principal.
Law of Agency - Answer-The rights, duties, and liabilities that arise among the parties
when an agent represents a principal in dealings with third parties are subject to this.
Actual Authority - Answer-The authority to act on behalf of the principal that the principal
intentionally confers (grants) on the agent and that the agent reasonably believes in
conferred.
Express Authority - Answer-The actual authority that a principal explicitly grants to an
agent.
Implied Authority - Answer-The actual authority that a principal intends an agent to have
and that arises incidentally from an express grand of authority.
Duty of Competence - Answer-The level of care required of an agent is the same as that
of a reasonably prudent person who has the same skills as the agent.
Indemnification - Answer-The compensation or reimbursement of another person's loss.
Ratification - Answer-The adoption/acknowledgment by a principal of an act that was
taken on the principal's behalf but without the principal's authorization.
Vicarious Liability - Answer-Indirect liability. Ex. When an employee commits a tort while
in the course of his employment, the employer is also liable for the tort.
Warranty of Authority - Answer-A guarantee recognized by law that an agent is acting
on behalf of a principal who has contractual capacity and that the agent has authority to
act for the principal.
Real Property - Answer-Property such as land and whatever is growing on or affixed to
the land.
Transferee - Answer-The party who sells property to another party.
Transferor - Answer-The party who buys property from another party.
Tenants in Common - Answer-Two or more parties who each own an undivided portion
of property. Each tenant has an equal right to possess and use the property, and each
has the right to sell or otherwise transfer ownership.
Joint Tenancy - Answer-Two or more individuals own equal shares in property and have
a right to survivorship. Each tenant has an equal right to possess and use the property,
, and each has the right to sell or otherwise transfer ownership. However, such a transfer
creates a tenancy in common.
Right to Survivorship - Answer-When one joint tenant dies, his share automatically
passes to the surviving joint tenant or tenants.
Community Property Laws - Answer-Law that states property acquired by one spouse
during a marriage as a gift or inheritance is the separate property of that spouse.
Income earned during a marriage is community property and any property purchased
with joint funds is considered to be community property.
Negative Easement - Answer-The right to prevent another party from making specific
uses of his own property.
Affirmative Easement - Answer-The right to make specific uses of another person's
property.
Restrictive Covenant - Answer-Agreements entered into by real property owners that
place restrictions on how the owners may use their property.
Zoning Restriction - Answer-A zoning law in a jurisdiction that affects how land within
the jurisdiction may be used.
Mortgagee - Answer-(Lender) The party to whom the interest is transferred - usually a
financial institution such as a bank.
Mortgagor - Answer-The borrower, who transfers its interest in property to another party
as security for a loan or other obligation.
Grantee - Answer-The person to whom title to real property is transferred by means of a
deed.
Warranty Deed - Answer-Conveys clear title to the property and which contains
warranties that the grantor has clear title to the property.
Quitclaim Deed - Answer-Conveys whatever ownership rights the grantor had in the
property when the teed was executed. Does not contain warranties of title. The grantor
does not have claim to have title to the property. Often used to correct technical defects
in the chain of title to property.
Grantor - Answer-The person who transfers title of real property to another person by
means of a deed.
Testator - Answer-Person who makes the will.
CORRECT DETAILED ANSWERS
(100% CORRECT)
Freedom of Contract - Answer-States that parties have the right to contract with
whomever they choose and on whatever lawful terms they choose. Under this principle,
the offeror controls the offer and has the right to decide with whom he or she will
contract.
Consideration - Answer-Whatever a promisor asks for and receives in exchange for his
contractual promise. This is legally adequate if it was bargained for and exchanged
between the parties.
Disaffirmance - Answer-A minor's exercise of his right to avoid a contract.
Necessaries - Answer-Goods and services that a minor or other incapacitated person
actually requires to sustain her well-being.
Void Contract - Answer-An agreement that was never enforceable by law because the
parties did not create a contract.
Voidable Contract - Answer-A party has the right to avoid her obligations under the
contract without incurring legal liability.
Accord and Satisfaction - Answer-One party agrees to accept something other than
what he or she was entitled to receive under the original contract as a method of
discharging the contract
Statute of Frauds - Answer-A law that declares certain types of contracts to be
unenforceable unless they are evidenced by a written document signed by the party to
be discharged without performing the contract.
Rule of Contra Proferentem - Answer-The rule that courts will construe unclear or
ambiguous language against the party who drafted or prepared a written contract,
unless the use of unclear language was required by law.
Parol Evidence Rule - Answer-States that parol evidence is not admissible to add to,
vary, or contradict the terms of a written contract.
Parol Evdience - Answer-Evidence that is outside of a written agreement.
,Agent - Answer-A party who is authorized by another party, the principal, to act on the
principal's behalf.
Agency - Answer-The legal relationship between the agent and the principal.
Law of Agency - Answer-The rights, duties, and liabilities that arise among the parties
when an agent represents a principal in dealings with third parties are subject to this.
Actual Authority - Answer-The authority to act on behalf of the principal that the principal
intentionally confers (grants) on the agent and that the agent reasonably believes in
conferred.
Express Authority - Answer-The actual authority that a principal explicitly grants to an
agent.
Implied Authority - Answer-The actual authority that a principal intends an agent to have
and that arises incidentally from an express grand of authority.
Duty of Competence - Answer-The level of care required of an agent is the same as that
of a reasonably prudent person who has the same skills as the agent.
Indemnification - Answer-The compensation or reimbursement of another person's loss.
Ratification - Answer-The adoption/acknowledgment by a principal of an act that was
taken on the principal's behalf but without the principal's authorization.
Vicarious Liability - Answer-Indirect liability. Ex. When an employee commits a tort while
in the course of his employment, the employer is also liable for the tort.
Warranty of Authority - Answer-A guarantee recognized by law that an agent is acting
on behalf of a principal who has contractual capacity and that the agent has authority to
act for the principal.
Real Property - Answer-Property such as land and whatever is growing on or affixed to
the land.
Transferee - Answer-The party who sells property to another party.
Transferor - Answer-The party who buys property from another party.
Tenants in Common - Answer-Two or more parties who each own an undivided portion
of property. Each tenant has an equal right to possess and use the property, and each
has the right to sell or otherwise transfer ownership.
Joint Tenancy - Answer-Two or more individuals own equal shares in property and have
a right to survivorship. Each tenant has an equal right to possess and use the property,
, and each has the right to sell or otherwise transfer ownership. However, such a transfer
creates a tenancy in common.
Right to Survivorship - Answer-When one joint tenant dies, his share automatically
passes to the surviving joint tenant or tenants.
Community Property Laws - Answer-Law that states property acquired by one spouse
during a marriage as a gift or inheritance is the separate property of that spouse.
Income earned during a marriage is community property and any property purchased
with joint funds is considered to be community property.
Negative Easement - Answer-The right to prevent another party from making specific
uses of his own property.
Affirmative Easement - Answer-The right to make specific uses of another person's
property.
Restrictive Covenant - Answer-Agreements entered into by real property owners that
place restrictions on how the owners may use their property.
Zoning Restriction - Answer-A zoning law in a jurisdiction that affects how land within
the jurisdiction may be used.
Mortgagee - Answer-(Lender) The party to whom the interest is transferred - usually a
financial institution such as a bank.
Mortgagor - Answer-The borrower, who transfers its interest in property to another party
as security for a loan or other obligation.
Grantee - Answer-The person to whom title to real property is transferred by means of a
deed.
Warranty Deed - Answer-Conveys clear title to the property and which contains
warranties that the grantor has clear title to the property.
Quitclaim Deed - Answer-Conveys whatever ownership rights the grantor had in the
property when the teed was executed. Does not contain warranties of title. The grantor
does not have claim to have title to the property. Often used to correct technical defects
in the chain of title to property.
Grantor - Answer-The person who transfers title of real property to another person by
means of a deed.
Testator - Answer-Person who makes the will.
