Chapter 13
Legality of Subject Matter and Proper Form of Contracts:
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1. Historically,
mala in se
contracts were voidable and
mala prohibita
contracts were often enforceable.
a. True
b. False
2. Price fixing agreements are generally permissible
a. True
b. False
3. Generally, covenants not to compete will be enforced if reasonable in length and geographic scope.
a. True
b. False
4. An agreement is illegal when either its formation or performance is a crime or a tort, or it is contrary to public policy.
a. True
b. False
5. A contract for services entered into by an unlicensed dentist would probably be enforceable.
a. True
b. False
6. If a contract can be interpreted in two ways, one legal and the other illegal, the court will assume that the illegal meaning was intended.
a. True
b. False
7. Ordinarily, a court will not consider whether a contract is fair or unfair.
a. True
b. False
8. Unconscionability and fraud are synonymous terms.
a. True
b. False
9. The Reed v. University of North Dakota case involved a usurious contract.
a. True
b. False
10. Martin orally agreed to paint Marsha's house sometime within the next three years for $2,500. This contract is not enforceable because of the Statute of Frauds.
a. True
b. False
11. Under the UCC, an oral contract for the sale of goods with a price in excess of $500 will be enforced if the buyer has made a partial acceptance of the goods.
a. True
b. False
12. A court will admit parol evidence to clear up ambiguities in an agreement.
a. True
b. False
13. Illegal agreements are:
a. void.
b. enforceable if one party acted in good faith.
c. voidable by one of the parties.
d. voidable by either party.
14. The covenants not to compete in
Standard Register Company v. Cleaver
were held to be:
a. void as against public policy.
b. voidable as against public policy.
c. enforceable as they were reasonable.
d. enforceable as there was equal bargaining power.
15. A contract deemed to be too harsh or oppressive to one of the contractual parties may be unenforceable under the concept of:
a. undue influence.
b. oppressive confrontation.
c. illegal coercion.
d. unconscionability.
16. Arturo enters into a contract with Rudy. Under the contract, Rudy is to burn down Arturo's warehouse so that Arturo can collect the insurance. This contract would be considered:
a.
Mala in se
.
b.
Mala prohibita
.
c.
Mala conflagration
.
d.
Mala ipsa
.
17. Michelle must fulfill all the requirements set out by statute in the State of Illinois before she can be admitted to practice law in Illinois. Although she has not yet finished law school, Michelle nevertheless enters into a contract to prepare articles of incorporation for Bob. A state licensing statute such as Illinois' will more than likely:
a. be regulatory in nature and will, therefore, prevent Michelle from enforcing the contract between the parties.
b. be regulatory in nature and will, therefore, not affect the contract between the parties.
c. be revenue-producing in nature and will, therefore, prevent Michelle from enforcing the contract.
d. be revenue-producing in nature and will, therefore, not affect the contract between the parties.
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