IA Bar Contracts 2 — Questions and Answers
Question 1: Under the UCC, a merchant's firm offer to buy or sell goods is irrevocable for up to how long without consideration?
- 30 days
- 3 months (Correct answer)
- 6 months
- 1 year
Correct answer: 3 months
UCC § 2-205 makes a merchant's signed, written firm offer irrevocable for the stated period or a reasonable time, not exceeding 3 months.
Question 2: Which doctrine excuses a party's non-performance when an unforeseen event destroys the specific subject matter of the contract?
- Frustration of purpose
- Impossibility of performance (Correct answer)
- Impracticability
- Mutual mistake
Correct answer: Impossibility of performance
Impossibility (also called objective impossibility) excuses performance when the specific subject matter is destroyed through no fault of either party.
Question 3: A contract for the sale of real property is enforceable under the Statute of Frauds only if it is:
- Witnessed by two parties
- Signed by the party to be charged (Correct answer)
- Notarized by a public officer
- Recorded in the county recorder's office
Correct answer: Signed by the party to be charged
The Statute of Frauds requires a writing signed by the party against whom enforcement is sought; notarization and recording are not required for contract enforcement.
Question 4: Under the Restatement (Second) of Contracts, an anticipatory repudiation occurs when a party:
- Fails to perform on the due date
- Unequivocally states it will not perform before performance is due (Correct answer)
- Requests a modification of the contract terms
- Partially performs but stops without explanation
Correct answer: Unequivocally states it will not perform before performance is due
Anticipatory repudiation requires an unequivocal refusal to perform communicated before the performance date arrives.
Question 5: What is the primary remedy the non-breaching party receives when a court awards specific performance?
- Compensatory damages equal to the contract price
- Return of any consideration already paid
- A court order compelling the breaching party to perform (Correct answer)
- Cancellation of all remaining contractual obligations
Correct answer: A court order compelling the breaching party to perform
Specific performance is an equitable remedy directing the breaching party to fulfill its contractual obligations as promised.
Question 6: Under the mailbox rule, an acceptance by mail is generally effective:
- When the offeror receives the letter
- When the offeree deposits the letter in the mail (Correct answer)
- When the postal carrier delivers the letter to the offeror's address
- When the offeror reads the acceptance
Correct answer: When the offeree deposits the letter in the mail
The mailbox rule makes acceptance effective upon proper dispatch, protecting the offeree from the risk of transmission delay.
Question 7: In a bilateral contract, the consideration flowing from each party is:
- A promise exchanged for a performance
- A promise exchanged for another promise (Correct answer)
- Money exchanged for a service rendered
- An act exchanged for a return act
Correct answer: A promise exchanged for another promise
A bilateral contract consists of mutual promises — each party's promise serves as consideration for the other's promise.
IA Bar Contracts 2
Under the UCC, a merchant's firm offer to buy or sell goods is irrevocable for up to how long without consideration?