BUL 3320 FINAL EXAM QUESTIONS
AND ANSWERS
Requirement of Consideration for an effective assignment - Correct Answers -
Consideration is not required.
Notice of an assignment to the obligor - Correct Answers -The obligor need not receive
notice for an assignment for it to be valid.
Implied Warranties - Correct Answers -an obligation imposed by law upon the transferor
of property or contract rights.
1.that he will do nothing to defeat or impair the assignment
2. that the assigned right actually exists and is subject to no limitations or defenses
other than those stated or apparent at the time of the assignment.
3. that any writing that evidences the right and that is delivered to the assignee or
exhibited to him as an inducement to accept the assignment is genuine and what it
purports to be; and
4. that the assignor has no knowledge of any fact that would impair the value of the
assignment.
Successive assignments of the same right - Correct Answers -the majority rule is that
the first assignee in point of time prevails over later assignees; the minority rule is that
the first assignee to notify the obligor prevails.
Liability of an assignor to pay assignee if obligor defaults - Correct Answers -If the
delivery (D) fails to act on their promise to A, A is liable to B.
Donee beneficiary - Correct Answers -a third party intended to receive a benefit from
the contract as a gift.
Creditor beneficiary - Correct Answers -a third person intended to receive a benefit from
the agreement to satisfy a legal duty owed to him.
Material Breach - Correct Answers -nonperformance that significantly impairs the
aggrieved party's rights under the contract; discharges the injured party from any further
duty under the contract.
, Substantial Performance - Correct Answers -performance that is incomplete but does
not defeat the purpose of contract; does not discharge the injured party but entitles him
to damages.
Accord - Correct Answers -a contract by which an obligee promises to accept a stated
performance in satisfaction of the obligor's existing contractual duty.
Satisfaction - Correct Answers -performance of an accord that discharges the original
duty.
Novation - Correct Answers -substituted contract involving a new third party promisor or
promisee
Mutual rescission - Correct Answers -agreement of the parties to terminate their
contractual duties
NAFTA - Correct Answers -took effect in '94. established a free trade area among US,
Canada, and Mexico.
Sovereign Immunity - Correct Answers -foreign country's freedom from a host country's
laws.
Act of State Doctrine - Correct Answers -rule that a court should not question the validity
of actions taken by a foreign government in its own country.
Tariff - Correct Answers -duty or tax imposed on goods moving into or out of a country
CISG - Correct Answers -UN Convention on Contracts for International Sale of Goods:
governs all contracts for international sales of goods between parties located in different
nations that have ratified the CISG.
Statute of limitations - Correct Answers -after the statute of limitations has run, the debt
is not discharged, but the creditor can not maintain an action against the debtor.
Objective impossibility - Correct Answers -performance cannot be done by anyone;
includes death, fire, etc. Discharges the promisor.
Punitive Damages - Correct Answers -are generally not recoverable for breach of
contract
Liquidated Damages - Correct Answers -reasonable damages agreed to in advance by
the parties to a contract.
Mitigation of damages - Correct Answers -the injured party may not recover damages
for loss he could have avoided by reasonable effort.
AND ANSWERS
Requirement of Consideration for an effective assignment - Correct Answers -
Consideration is not required.
Notice of an assignment to the obligor - Correct Answers -The obligor need not receive
notice for an assignment for it to be valid.
Implied Warranties - Correct Answers -an obligation imposed by law upon the transferor
of property or contract rights.
1.that he will do nothing to defeat or impair the assignment
2. that the assigned right actually exists and is subject to no limitations or defenses
other than those stated or apparent at the time of the assignment.
3. that any writing that evidences the right and that is delivered to the assignee or
exhibited to him as an inducement to accept the assignment is genuine and what it
purports to be; and
4. that the assignor has no knowledge of any fact that would impair the value of the
assignment.
Successive assignments of the same right - Correct Answers -the majority rule is that
the first assignee in point of time prevails over later assignees; the minority rule is that
the first assignee to notify the obligor prevails.
Liability of an assignor to pay assignee if obligor defaults - Correct Answers -If the
delivery (D) fails to act on their promise to A, A is liable to B.
Donee beneficiary - Correct Answers -a third party intended to receive a benefit from
the contract as a gift.
Creditor beneficiary - Correct Answers -a third person intended to receive a benefit from
the agreement to satisfy a legal duty owed to him.
Material Breach - Correct Answers -nonperformance that significantly impairs the
aggrieved party's rights under the contract; discharges the injured party from any further
duty under the contract.
, Substantial Performance - Correct Answers -performance that is incomplete but does
not defeat the purpose of contract; does not discharge the injured party but entitles him
to damages.
Accord - Correct Answers -a contract by which an obligee promises to accept a stated
performance in satisfaction of the obligor's existing contractual duty.
Satisfaction - Correct Answers -performance of an accord that discharges the original
duty.
Novation - Correct Answers -substituted contract involving a new third party promisor or
promisee
Mutual rescission - Correct Answers -agreement of the parties to terminate their
contractual duties
NAFTA - Correct Answers -took effect in '94. established a free trade area among US,
Canada, and Mexico.
Sovereign Immunity - Correct Answers -foreign country's freedom from a host country's
laws.
Act of State Doctrine - Correct Answers -rule that a court should not question the validity
of actions taken by a foreign government in its own country.
Tariff - Correct Answers -duty or tax imposed on goods moving into or out of a country
CISG - Correct Answers -UN Convention on Contracts for International Sale of Goods:
governs all contracts for international sales of goods between parties located in different
nations that have ratified the CISG.
Statute of limitations - Correct Answers -after the statute of limitations has run, the debt
is not discharged, but the creditor can not maintain an action against the debtor.
Objective impossibility - Correct Answers -performance cannot be done by anyone;
includes death, fire, etc. Discharges the promisor.
Punitive Damages - Correct Answers -are generally not recoverable for breach of
contract
Liquidated Damages - Correct Answers -reasonable damages agreed to in advance by
the parties to a contract.
Mitigation of damages - Correct Answers -the injured party may not recover damages
for loss he could have avoided by reasonable effort.
