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Homework Assigned May 31, 2012 (Chapter 12)

100 pts
Due prior to class Monday June 4, 2012.
You must put your PIN number on your answers (attached document). 10 question, 10 pts
each.

1. A contract that is written on LMNs form contract, that contains pages of terms
and conditions in small print, that is offered on a take or leave it basis, and in a
situation where LMN has all the bargaining power is commonly known as a:
a. Arms length contract.
b. Usury contract.
c. Exculpatory contract.
d. Contract of adhesion.
2. Tom and Sue agree that Sue will give Tom a box of printer paper and a box of
staples by stealing them from the office where Sue is employed as an
administrative assistant (without her employers knowledge or consent) in
exchange for Tom fixing Sues TV. Sue gives Tom the box of printer paper and
the paper clips from her office, but Tom doesnt get around to fixing Sues TV.
Can Sue enforce the agreement she had with Tom?
a. Yes, but Sue runs the risk of being arrested for a crime.
b. No because stealing the printer paper and staples was a crime.
c. No, unless she can get the court to use the UCC instead of common law for
this transaction.
3. Carlos has graduated from law school, passed the bar exam, but has not yet
been given a license to practice law in the state (this will happen on one month).
He is hired by a client for $1,000 to draft a contract. He drafts the contract and
does a great job on it, gives it to the client, but the client refuses to pay the
$1,000. Carlos:
a. must wait until he is granted his license before suing the client for the
$1,000.
b. will never be able to get the $1,000 from the client
c. does not have to wait, but can sue the client now for $1,000 because it takes
more than one month for cases to get in front of a judge.
4. Illegal contracts are:
a.
void
b.
voidable

5. A local bowling alley requires its patrons (if they want to bowl) to sign a form
that says the bowling alley is not responsible for injuries caused to patrons for
the bowling alleys own employees ordinary negligence. This clause is likely
to be:
a. unenforceable
b. enforceable
6. Usury laws
a. prohibit using another persons personal property for ones own benefit
without the owners permission
b. protect consumers from businesses that engage in false and misleading
advertising
c. are set forth in the U.S. constitution
d. prohibit charging excess interest on loans
7. Mary and Andrea orally bet on which movie will win the Best Movie award at
the Academy of Awards in a state where gambling is illegal. Mary wins the
bet, but Andrea refuses to pay. Mary files suit in small claims court. Will Mary
prevail?
a. yes, as long as the bet was for an amount under the small claims court limit
b. it depends upon whether or not Mary and Andrea signed something saying
they waive the right to use the illegality defense
c. it depends upon whether or not there were any witnesses to the bet
d. no
8. If you use valet parking at a restaurant, that creates:
a. usury situation
b. encumbrance
c. bailment
d. proxy
9. Mr. and Mrs. Kettle have owned and operated Ma and Pas Deli near Stelling
and Stevens Creek for the last 30 years. It is their only location. They have a secret
formula for their sandwich sauce that makes their deli very popular among De
Anza students and the local community. They decide to retire and sell Ma and
Pas Deli to George. As a part of the contract to sell the business, they agree to an
agreement not to open another business of any type in the State of California for 15
years. This agreement not to compete:
a.
Is likely to be unenforceable.
b.
Is likely to be enforceable because it is ancillary to the sale of a business.

10. A local public mass transit company named FART has decided to have all
customers agree to a waiver of liability for any injury while using FARTs
services, including any acts of ordinary negligence, recklessness, or intentional
torts committed by FARTs employees, at the time they buy a ticket to ride on
FART. Jane is injured when a FART employee recklessly drove the train at an
excessive speed. Jane sues FART for damages. Under these facts:
a.
FART probably will not be liable for damages because Jane agreed to a valid
exculpatory clause.
b.
FART probably will not be liable for damages due to the defense of
assumption of the risk.
c.
Jane will probably win because the exculpatory clause was unenforceable.
d.
Jane will probably win on the basis of res ipsa loquitor.

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