CONTRACTS MBE QUESTIONS 2. On August 1, Geriatrics, Inc., operating a !i"eti#e care $o#e "or t$e e!%er!&, a%#itte% O$!

ster, '$o 'as () &ears o!%, "or a tria! perio% o" t'o #ont$s. On Septe#*er 2+, O$!ster an% Geriatrics entere% into a 'ritten !i"eti#e care contract 'it$ an e""ecti,e co##ence#ent %ate o" Octo*er 1. T$e "u!! contract price 'as -2.,..., '$ic$, as re/uire% *& t$e ter#s o" t$e contract, O$!ster prepai% to Geriatrics on Septe#*er 2+. O$!ster %ie% o" a $eart attac0 on Octo*er 2. In a restitutionar& action, can t$e a%#inistratri1 o" O$!ster2s estate, a sur,i,ing sister, reco,er on *e$a!" o" t$e estate eit$er a!! or part o" t$e -2.,... pai% to Geriatrics on Septe#*er 2+3 4A5 4B5 4C5 485 6es, *ecause Geriatrics 'ou!% ot$er'ise *e un7ust!& enric$e% at O$!ster2s e1pense. 6es, un%er t$e %octrine o" "rustration o" purpose. No, *ecause O$!ster2s !i"e span an% t$e %uration o" Geriatrics2 co##it#ent to $i# 'as a ris0 assu#e% *& *ot$ parties. No, *ut on!& i" Geriatrics can s$o' t$at *et'een Septe#*er 2+ an% O$!ster2s %eat$ it re7ecte%, *ecause o" its co##it#ent to O$!ster, an app!ication "or !i"eti#e care "ro# anot$er e!%er!& person.

Questions (+9(: are *ase% on t$e "o!!o'ing "act situation. Spen%er o'e% Mi%as -1,..., p!us interest at (; unti! pai%, on a !ong9o,er%ue pro#issor& note, co!!ection o" '$ic$ 'ou!% *eco#e *arre% *& t$e statute o" !i#itations on <une =.. On t$e prece%ing Apri! 1, Spen%er an% Mi%as *ot$ signe% a 'riting in '$ic$ Spen%er pro#ise% to pa& t$e note in "u!! on t$e "o!!o'ing 8ece#*er =1, p!us interest at (; unti! t$at %ate, an% Mi%as pro#ise% not to sue on t$e note in t$e #eanti#e. Mi%as, $a,ing recei,e% so#e a%,ice "ro# $is non!a'&er *rot$er9in9!a' *eca#e concerne% a*out t$e !ega! e""ect o" t$e Apri! 1 agree#ent. On Ma& 1, acting pro se as per#itte% *& t$e ru!es o" t$e !oca! s#a!! c!ai#s court, $e "i!e% suit to co!!ect t$e note. (+. Assu#ing t$at t$ere is no contro!!ing statute, is t$e Apri! 1 agree#ent an e""ecti,e %e"ense "or Spen%er3 4A5 4B5 4C5 485 6es, *ecause Spen%er2s pro#ise to pa& interest unti! 8ece#*er =1 'as consi%eration "or Mi%as2s pro#ise not to sue. 6es, *ecause t$e !a' creates a presu#ption t$at Spen%er re!ie% on Mi%as2s pro#ise not to sue. No, *ecause t$ere 'as no consi%eration "or Mi%as2s pro#ise not to sue, in t$at Spen%er 'as a!rea%& o*!igate% to pa& -1,... p!us interest at (; unti! t$e pa&#ent %ate. No, *ecause Spen%er2s Apri! 1 pro#ise is en"orcea*!e 'it$ or 'it$out consi%eration.

Questions 12.9121 are *ase% on t$e "o!!o'ing "act situation. A!ice entere% into a contract 'it$ >au! *& t$e ter#s o" '$ic$ >au! 'as to paint A!ice2s o""ice "or -1,... an% 'as re/uire% to %o a!! o" t$e 'or0 o,er t$e "o!!o'ing 'ee0en% so as to a,oi% %isruption o" A!ice2s *usiness. 12.. ?or t$is /uestion on!&, assu#e t$e "o!!o'ing "acts. I" >au! $a% starte% to paint on t$e "o!!o'ing Satur%a& #orning, $e cou!% $a,e "inis$e% *e"ore Sun%a& e,ening. @o'e,er, $e sta&e% $o#e t$at Satur%a& #orning to 'atc$ t$e "ina! ga#e o" t$e Aor!% Series on TB, an% %i% not start to paint unti! Satur%a& a"ternoon. B& !ate Satur%a& a"ternoon, >au!

rea!iCe% t$at $e $a% un%eresti#ate% t$e ti#e it 'ou!% ta0e to "inis$ t$e 7o* i" $e continue% to 'or0 a!one. >au! p$one% A!ice at $er $o#e an% accurate!& in"or#e% $er t$at it 'as i#possi*!e to "inis$ t$e 'or0 o,er t$e 'ee0en% un!ess $e $ire% a $e!per. @e a!so state% t$at to %o so 'ou!% re/uire an a%%itiona! c$arge o" -2.. "or t$e 'or0. A!ice to!% >au! t$at s$e apparent!& $a% no c$oice *ut to pa& '$ate,er it ta0es to get t$e 'or0 %one as sc$e%u!e%. >au! $ire% Te% to $e!p "inis$ t$e painting an% pai% Te% -2... A!ice $as o""ere% to pa& >au! -1,.... >au! is %e#an%ing -1,2... @o' #uc$ is >au! !i0e!& to reco,er3 4A5 4B5 4C5 485 121. -1,... on!&, *ecause A!ice recei,e% no consi%eration "or $er pro#ise to pa& t$e a%%itiona! su#. -1,... on!&, *ecause A!ice2s pro#ise to pa& '$ate,er it ta0es is too uncertain to *e en"orcea*!e. -1,2.., in or%er to pre,ent A!ice2s un7ust enric$#ent. -1,2.., *ecause t$e i#possi*i!it& o" >au!2s co#p!eting t$e 'or0 a!one %isc$arge% t$e origina! contract an% a ne' contract 'as "or#e%.

?or t$is /uestion on!&, assu#e t$e "o!!o'ing "acts. >au! co##ence% 'or0 on Satur%a& #orning, an% $a% "inis$e% $a!" t$e painting *& t$e ti#e $e /uit 'or0 "or t$e %a&. T$at nig$t, 'it$out t$e "au!t o" eit$er part&, t$e o""ice *ui!%ing 'as %estro&e% *& "ire. A$ic$ o" t$e "o!!o'ing is an accurate state#ent3 4A5 4B5 4C5 48 Bot$ parties2 contractua! %uties are %isc$arge%, an% >au! can reco,er not$ing "ro# A!ice. Bot$ parties2 contractua! %uties are %isc$arge%, *ut >au! can reco,er in /uasi9 contract "ro# A!ice. On!& >au!2s contractua! %ut& is %isc$arge%, *ecause A!ice2s per"or#ance 4pa&#ent o" t$e agree% price5 is not i#possi*!e. On!& >au!2s contractua! %ut& is %isc$arge%, an% >au! can reco,er $is re!iance %a#ages "ro# A!ice.

1:1.

Testator, '$ose nep$e' B&past 'as $is on!& $eir, %ie% !ea,ing a 'i!! t$at ga,e $is entire estate to c$arit&. B&past, 0no'ing "u!! 'e!! t$at Testator 'as o" soun% #in% a!! o" $is !i"e, an% $a,ing no e,i%ence to t$e contrar&, ne,ert$e!ess "i!e% a suit contesting Testator2s 'i!! on t$e groun% t$at Testator 'as inco#petent '$en t$e 'i!! 'as signe%. Cra,en, Testator2s e1ecutor, o""ere% B&past -+,... to sett!e t$e suit, an% B&past agree%. I" Cra,en t$en repu%iates t$e agree#ent an% t$e "oregoing "acts are pro,e% or a%#itte% in B&past2s suit against Cra,en "or *reac$ o" contract, is B&past entit!e% to reco,er un%er t$e pre,ai!ing ,ie'3 4A5 4B5 4C5 485 6es, *ecause t$e B&past9Cra,en agree#ent 'as a *argaine%9"or e1c$ange 6es, *ecause t$e !a' encourages t$e sett!e#ent o" %ispute% c!ai#s. No, *ecause B&past %i% not *ring t$e 'i!! contest in goo% "ait$. No, *ecause an agree#ent to oust t$e court o" its 7uris%iction to %eci%e a 'i!! contest is contrar& to pu*!ic po!ic&.

1D2.

?or an agree% price o" -2. #i!!ion, Bi!%0o, Inc., contracte% 'it$ Benture to %esign an% *ui!% on Benture2s co##ercia! p!ot a 1+9stor& o""ice *ui!%ing. In e1ca,ating "or t$e "oun%ation an% un%ergroun% uti!ities, Bi!%0o encountere% a #assi,e !a&er o" granite at a %ept$ o" 1+ "eet. B& reasona*!e sa"et& criteria, t$e *ui!%ings2 "oun%ation re/uire% a #ini#u# e1ca,ation o" 2+ "eet. A$en t$e contract 'as #a%e, neit$er Benture nor Bi!%0o

'as a'are o" t$e su*sur"ace granite, "or t$e presence o" '$ic$ neit$er part& $a% $ire% a /ua!i"ie% e1pert to test. C!ai#ing accurate!& t$at re#o,a! o" enoug$ granite to per#it t$e construction as p!anne% 'ou!% cost $i# an a%%itiona! -= #i!!ion an% a pro*a*!e net !oss on t$e contract o" -2 #i!!ion, Bi!%0o re"use% to procee% 'it$ t$e 'or0 un!ess Benture 'ou!% pro#ise to pa& an a%%itiona! -2.+ #i!!ion "or t$e co#p!ete% *ui!%ing. I" Benture re"uses an% sues Bi!%0o "or *reac$ o" contract, '$ic$ o" t$e "o!!o'ing 'i!! t$e court pro*a*!& %eci%e3 4A5 4B5 4C5 485 Question 2) Ro!!e#, an auto#o*i!e retai!er, $a% an a%u!t %aug$ter, Bets&, '$o nee%e% a car in $er e#p!o&#ent *ut $a% on!& -=,... 'it$ '$ic$ to *u& one. Ro!!e# 'rote to $er, Gi,e #e &our -=,... an% I2!! gi,e &ou t$e car on our !ot t$at 'e $a,e *een using as a %e#onstrator. Bets& t$an0e% $er "at$er an% pai% $i# t$e -=,.... As *ot$ Ro!!e# an% Bets& 0ne', t$e %e#onstrator 'as reasona*!& 'ort$ -1.,.... A"ter Bets& $a% pai% t$e -=,..., *ut *e"ore t$e car $a% *een %e!i,ere% to $er, one o" Ro!!e#2s sa!es sta"" so!% an% %e!i,ere% t$e sa#e car to a custo#er "or -1.,.... Neit$er t$e sa!esperson nor t$e custo#er 'as a'are o" t$e transaction *et'een Ro!!e# an% Bets&. 8oes Bets&, a"ter re7ecting a ten%ere% return o" t$e -=,... *& Ro!!e#, $a,e an action against $i# "or *reac$ o" contract3 A. B. C. 8. 6es, *ecause Ro!!e#2s pro#ise 'as supporte% *& *argaine%9"or consi%eration. 6es, *ecause Ro!!e#2s pro#ise 'as supporte% *& t$e #ora! o*!igation a "at$er o'es $is c$i!% as to t$e necessities o" #o%ern !i"e. No, *ecause t$e pa&#ent o" -=,... 'as ina%e/uate consi%eration to support Ro!!e#2s pro#ise. No, *ecause t$e sa!esperson2s %e!i,er& o" t$e car to t$e custo#er #a%e it i#possi*!e "or Ro!!e# to per"or#. Bi!%0o is e1cuse% un%er t$e #o%ern %octrine o" super,ening i#possi*i!it&, '$ic$ inc!u%es se,ere i#practica*i!it&. Bi!%0o is e1cuse%, *ecause t$e contract is ,oi%a*!e on account o" t$e parties2 #utua! #ista0e concerning an essentia! un%er!&ing "act. Benture pre,ai!s, *ecause Bi!%0o assu#e% t$e ris0 o" encountering su*sur"ace granite t$at 'as un0no'n to Benture. Benture pre,ai!s, un!ess su*sur"ace granite 'as pre,ious!& un0no'n an&'$ere in t$e ,icinit& o" Benture2s construction site.

Question 2E Foo#is, t$e o'ner an% operator o" a s#a!! *usiness, encourages 'e!!ness on t$e part o" $is e#p!o&ees an% supports ,arious p$&sica!9"itness progra#s to t$at en%. Fearning t$at one o" $is e#p!o&ees, Grace"u!, 'as a %e%icate% 7ogger, Foo#is pro#ise% to pa& $er a specia! a'ar% o" -1.. i" s$e cou!% an% 'ou!% run one #i!e in !ess t$an si1 #inutes on t$e "o!!o'ing Satur%a&. Grace"u! t$an0e% $i#, an% %i% in "act run a #i!e in !ess t$an si1 #inutes on t$e %a& speci"ie%. S$ort!& t$erea"ter, $o'e,er, Foo#is %isco,ere% t$at "or #ore t$an a &ear Grace"u! $a% *een running at !east one #i!e in !ess t$an si1 #inutes e,er& %a& as a part o" $er persona! "itness progra#. @e re"use% to pa& t$e -1... In an action *& Grace"u! against Foo#is "or *reac$ o" contract, '$ic$ o" t$e "o!!o'ing *est su##ariCes t$e pro*a*!e %ecision o" t$e court3

A. Foo#is 'ins, *ecause it is a co#pe!!ing in"erence t$at Foo#is2s pro#ise %i% not in%uce Grace"u! to run t$e speci"ie% #i!e. B. Foo#is 'ins, *ecause Grace"u!2s running o" t$e speci"ie% #i!e 'as *ene"icia!, not %etri#enta!, to $er in an& e,ent. C. Grace"u! 'ins, *ecause running a #i!e in !ess t$an si1 #inutes is a signi"icant!& %e#an%ing enterprise. 8. Grace"u! 'ins, *ecause s$e ran t$e speci"ie% #i!e as re/ueste%, an% $er #oti,es "or %oing so are irre!e,ant. Question 12= C!ient consu!te% Fa'&er a*out $an%!ing t$e sa!e o" C!ient2s *ui!%ing, an% as0e% Fa'&er '$at $er !ega! "ee 'ou!% *e. Fa'&er rep!ie% t$at $er usua! c$arge 'as -1.. per $our, an% esti#ate% t$at t$e !ega! 'or0 on *e$a!" o" C!ient 'ou!% cost a*out -+,... at t$at rate. C!ient sai%, O0a&G !et2s procee% 'it$ it, an% Fa'&er ti#e!& an% success"u!!& co#p!ete% t$e 'or0. Because o" une1pecte% tit!e pro*!e#s, Fa'&er reasona*!& spent D+ $ours on t$e #atter an% s$ort!& t$erea"ter #ai!e% C!ient a *i!! "or -D,+.., 'it$ a !etter ite#iCing t$e 'or0 per"or#e% an% ti#e spent. C!ient respon%e% *& a !etter e1pressing $is goo% "ait$ *e!ie" t$at Fa'&er $a% agree% to a tota! "ee o" no #ore t$an -+,.... C!ient enc!ose% a c$ec0 in t$e a#ount o" -+,... pa&a*!e to Fa'&er an% conspicuous!& #ar0e%, >a&#ent in "u!! "or !ega! ser,ices in connection 'it$ t$e sa!e o" C!ient2s *ui!%ing. 8espite rea%ing t$e >a&#ent in "u!!. . . !anguage, Fa'&er, 'it$out an& notation o" protest or reser,ation o" rig$ts, en%orse% an% %eposite% t$e c$ec0 to $er *an0 account. T$e c$ec0 'as %u!& pai% *& C!ient2s *an0. A "e' %a&s !ater, Fa'&er unsuccess"u!!& %e#an%e% pa&#ent "ro# C!ient o" t$e -2,+.. %i""erence *et'een t$e a#ount o" $er *i!! an% t$e c$ec0, an% no' sues C!ient "or t$at %i""erence. A$at, i" an&t$ing, can Fa'&er reco,er "ro# C!ient3 A. Not$ing, *ecause t$e ris0 o" une1pecte% tit!e pro*!e#s in a rea! propert& transaction is proper!& a!!oca*!e to t$e se!!er2s attorne& an% t$us to Fa'&er in t$is case. B. Not$ing, *ecause t$e a#ount o" Fa'&er2s "ee 'as %ispute% in goo% "ait$ *& C!ient, an% Fa'&er i#p!ie%!& agree% to an accor% an% satis"action. C. -2,+.., *ecause C!ient agree% to an $our!& rate "or as #an& $ours as t$e 'or0 reasona*!& re/uire%, an% t$e su# o" -+,... 'as #ere!& an esti#ate. 8. T$e reasona*!e ,a!ue o" Fa'&er2s ser,ices in e1cess o" -+,..., i" an&, *ecause t$ere 'as no speci"ic agree#ent on t$e tota! a#ount o" Fa'&er2s "ee. Question 1(: A *urg!ar sto!e Co!!ecta2s i#pressionist painting ,a!ue% at -)..,.... Co!!ecta, '$o $a% insure% t$e painting "or -=..,... 'it$ Artistic Insurance Co., pro#ise% to pa& -2+,... to Snoop, a "u!!9 ti#e in,estigator "or Artistic, i" $e e""ecte% t$e return o" t$e painting to $er in goo% con%ition. B& co#pan& ru!es, Artistic per#its its in,estigators to accept an% retain re'ar%s "ro# po!ic&$o!%ers "or t$e reco,er& o" insure% propert&. Snoop, *& !ong an% s0i!!"u! %etecti,e 'or0, reco,ere% t$e picture an% returne% it un%a#age% to Co!!ecta. I" Co!!ecta re"uses to pa& Snoop an&t$ing, an% $e sues $er "or -2+,..., '$at is t$e pro*a*!e resu!t un%er t$e pre,ai!ing #o%ern ru!e3 A. Co!!ecta 'ins, *ecause Snoop o'e% Artistic a pree1isting %ut& to reco,er t$e picture i" possi*!e. B. Co!!ecta 'ins, *ecause Artistic, Snoop2s e#p!o&er, $a% a pree1isting %ut& to return t$e reco,ere% painting to Co!!ecta. C. Snoop 'ins, *ecause Co!!ecta 'i!! *ene"it #ore "ro# return o" t$e -)..,... painting t$an "ro# recei,ing t$e -=..,... po!ic& procee%s.

8. Snoop 'ins, *ecause t$e pree1isting %ut& ru!e %oes not app!& i" t$e pro#isee2s 4Snoop2s5 %ut& 'as o'e% to a t$ir% person. Questions 1(E91E. are *ase% on t$e "o!!o'ing "act situation. Sue Starr, a #inor *ot$ in "act an% appearance, *oug$t on cre%it an% too0 %e!i,er& o" a te!escope "ro# =.9&ear9o!% >au! >ris# "or an agree% price o" -1... Upon reac$ing $er #a7orit& soon t$erea"ter, Starr encountere% >ris# an% sai%, I a# sorr& "or not $a,ing pai% &ou t$at -1.. "or t$e te!escope '$en t$e #one& 'as %ue, *ut I "oun% out it 'as on!& 'ort$ -D+. So I no' pro#ise to pa& &ou -D+. Starr su*se/uent!& repu%iate% t$is pro#ise an% re"use% to pa& >ris# an&t$ing. Question 1(E In an action "or *reac$ o" contract *& >ris# against Starr, >ris#2s pro*a*!e reco,er& is A. not$ing, *ecause Starr 'as a #inor at t$e ti#e o" t$e origina! transaction. B. not$ing, *ecause t$ere 'as no consi%eration "or t$e pro#ise #a%e *& Starr a"ter reac$ing #a7orit&. C. -D+. 8. -1... Questions )E99+. are *ase% on t$e "o!!o'ing "act situation. Tenant rente% a co##ercia! *ui!%ing "ro# Fan%!or%, an% operate% a *usiness in it. T$e *ui!%ing2s !arge "ront 'in%o' 'as s#as$e% *& ,an%a!s si1 #ont$s *e"ore e1piration o" t$e Tenant9Fan%!or% !ease. Tenant, '$o 'as o*!igate% t$ereun%er to e""ect an% pa& "or repairs in suc$ cases, pro#pt!& contracte% 'it$ G!aCier to rep!ace t$e 'in%o' "or -2,..., %ue =. %a&s a"ter satis"actor& co#p!etion o" t$e 'or0. Fan%!or% 'as t$en una'are o" t$e Tenant9G!aCier contract. G!aCier 'as a'are t$at t$e *ui!%ing 'as un%er !ease, *ut %ea!t entire!& 'it$ Tenant. Si1t& %a&s a"ter G!aCier2s satis"actor& co#p!etion o" t$e 'in%o' rep!ace#ent, an% prior to t$e e1piration o" Tenant2s !ease, Tenant, t$en inso!,ent, cease% %oing *usiness an% ,acate% t$e *ui!%ing. In so %oing, Tenant "or"eite% un%er t$e !ease pro,isions its rig$t to t$e return o" a -2,... securit& %eposit 'it$ Fan%!or%. T$e %eposit $a% *een re/uire%, $o'e,er, "or t$e e1press purpose 4as state% in t$e !ease5 o" co,ering an& %a#age to t$e !ease% propert& e1cept or%inar& 'ear an% tear. T$e on!& suc$ %a#age occurring %uring Tenant2s occupanc& 'as t$e s#as$e% 'in%o'. G!aCier2s -2,... *i!! "or t$e 'in%o' rep!ace#ent is '$o!!& unpai%. Question )E Assu#ing t$at G!aCier $as no re#e%& /uasi in re# un%er t$e re!e,ant state #ec$anic2s !ien statute, '$ic$ o" t$e "o!!o'ing 'ou!% pro,i%e G!aCier2s *est c$ance o" an e""ecti,e re#e%& in persona# against Fan%!or%3 A. An action in /uasi contract "or t$e reasona*!e ,a!ue o" a *ene"it uno""icious!& an% non9 gratuitous!& con"erre% on Fan%!or%. B. An action *ase% on pro#issor& estoppe!. C. An action *ase% on an i#p!ie%9in9"act contract. 8. An action as t$ir%9part& inten%e% *ene"iciar& o" t$e Tenant9Fan%!or% !ease. Question +. ?or t$is /uestion on!&, assu#e t$e "o!!o'ing "acts. Upon ,acating t$e *ui!%ing, Tenant #ai!e% a -1,... c$ec0 to G!aCier *earing on its "ace t$e "o!!o'ing conspicuous notationH T$is c$ec0 is in "u!! an% "ina! satis"action o" &our -2,... 'in%o' rep!ace#ent *i!!. Ait$out noticing t$is notation, G!aCier cas$e% t$e c$ec0 an% no' sues Tenant "or t$e -1,... %i""erence. I" Tenant2s on!& %e"ense is accor% an% satis"action, is Tenant !i0e!& to pre,ai!3

A. No, *ecause G!aCier "ai!e% to notice Tenant2s notation on t$e c$ec0. B. No, *ecause t$e a#ount o'e% *& Tenant to G!aCier 'as !i/ui%ate% an% un%ispute%. C. 6es, *ecause *& cas$ing t$e c$ec0 G!aCier i#p!ie%!& agree% to accept t$e -1,... as "u!! pa&#ent o" its c!ai#. 8. 6es, *ecause G!aCier "ai!e% to 'rite a reser,ation9o"9rig$ts notation on t$e c$ec0 *e"ore cas$ing it. Question 1() Gour#et purc$ase% t$e "ront portion o" t$e !an% nee%e% "or a restaurant $e %esire% to *ui!% an% operate, *ut t$e *ac0 portion 'as t$e su*7ect o" a 'i!! %ispute *et'een @ope an% ?ait$ 4t'o sisters5. @ope2s attorne& a%,ise% $er t$at $er c!ai# 'as %ou*t"u!. Gour#et, 0no'ing on!& t$at t$e unreso!,e% %ispute e1iste%, agree% in a signe% 'riting to pa& @ope -:,..., pa&a*!e -1,... annua!!&, in e1c$ange "or a /uitc!ai# %ee% 4a %ee% containing no 'arranties5 "ro# @ope, '$o pro#pt!& e1ecute% suc$ a %ee% to Gour#et an% recei,e% Gour#et2s "irst annua! pa&#ent. S$ort!& t$erea"ter, t$e pro*ate court $an%e% %o'n a %ecision in ?ait$2s "a,or, ru!ing t$at @ope $a% no interest in t$e !an%. T$is %ecision $as *eco#e "ina!. Gour#et su*se/uent!& %e"au!te% '$en $is secon% annua! insta!!#ent ca#e %ue. In an action against Gour#et "or *reac$ o" contract, @ope 'i!! pro*a*!& A. !ose, *ecause s$e 'as a'are at t$e ti#e o" t$e agree#ent 'it$ Gour#et t$at $er c!ai# to t$e propert& /uit9c!ai#e% 'as %ou*t"u!. B. !ose, *ecause @ope su""ere% no !ega! %etri#ent in e1ecuting t$e /uitc!ai# %ee%. C. 'in, *ecause Gour#et *argaine% "or an% recei,e% in e1c$ange a /uitc!ai# %ee% "ro# @ope. 8. 'in, *ecause Gour#et, *& pa&ing t$e "irst -1,... insta!!#ent, is estoppe% to %en& t$at $is agree#ent 'it$ @ope is an en"orcea*!e contract. Question 1:E Fo&a!, age% :., '$o $a% no p!ans "or ear!& retire#ent, $a% 'or0e% "or Mutate, Inc., "or 2. &ears as a #anageria! e#p!o&ee9at9'i!! '$en $e $a% a con,ersation 'it$ t$e co#pan&2s presi%ent, George Mutant, a*out Fo&a!2s post9retire#ent goa! o" e1tensi,e tra,e! aroun% t$e Unite% States. A #ont$ !ater, Mutant $an%e% Fo&a! a 'ritten, signe% reso!ution o" t$e co#pan&2s Boar% o" 8irectors stating t$at '$en an% i" Fo&a! s$ou!% %eci%e to retire, at $is option, t$e co#pan&, in recognition o" $is past ser,ice, 'ou!% pa& $i# a -2,...9per #ont$ !i"eti#e pension. 4T$e co#pan& $a% no regu!ariCe% retire#ent p!an "or at9'i!! e#p!o&ees.5 S$ort!& t$erea"ter, Fo&a! retire% an% i##e%iate!& *oug$t a -=.,... recreationa! ,e$ic!e "or $is p!anne% tra,e!s. A"ter recei,ing t$e pro#ise% -2,... #ont$!& pension "ro# Mutate, Inc., "or si1 #ont$s, Fo&a!, no' une#p!o&a*!e e!se'$ere, recei,e% a !etter "ro# Mutate, Inc., a%,ising $i# t$at t$e pension 'ou!% cease i##e%iate!& *ecause o" recessionar& *u%get constraints a""ecting in ,ar&ing %egrees a!! #anageria! sa!aries an% retire#ent pensions. In a suit against Mutate, Inc., "or *reac$ o" contract, Fo&a! 'i!! pro*a*!& A. 'in, *ecause $e retire% "ro# t$e co#pan& as *argaine%9"or consi%eration "or t$e Boar%2s pro#ise to $i# o" a !i"eti#e pension. B. 'in, *ecause $e ti#e% $is %ecision to retire an% to *u& t$e recreationa! ,e$ic!e in reasona*!e re!iance on t$e Boar%2s pro#ise to $i# o" a !i"eti#e pension. C. !ose, *ecause t$e Boar%2s pro#ise to $i# o" a !i"eti#e pension 'as an unen"orcea*!e gi"t pro#ise. 8. !ose, *ecause $e $a% *een an e#p!o&ee at9'i!! t$roug$out $is acti,e ser,ice 'it$ t$e co#pan&. Questions ).9)1 are *ase% on t$e "o!!o'ing "act situation.

8o#ini/ue o*taine% a *i% o" -1.,... to tear %o'n $er o!% *ui!%ing an% anot$er *i% o" -E.,... to rep!ace it 'it$ a ne' structure in '$ic$ s$e p!anne% to operate a sporting goo%s store. @a,ing on!& !i#ite% cas$ a,ai!a*!e, 8o#ini/ue as0e% @ar%cas$ "or a -1..,... !oan. A"ter re,ie'ing t$e p!ans "or t$e pro7ect, @ar%cas$ in a signe% 'riting pro#ise% to !en% 8o#ini/ue -1..,... secure% *& a #ortgage on t$e propert& an% repa&a*!e o,er ten &ears in e/ua! #ont$!& insta!!#ents at 1.; annua! interest. 8o#ini/ue pro#pt!& accepte% t$e %e#o!ition *i% an% t$e o!% *ui!%ing 'as re#o,e%, *ut @ar%cas$ t$erea"ter re"use% to #a0e t$e !oan. 8espite %i!igent e""orts, 8o#ini/ue 'as una*!e to o*tain a !oan "ro# an& ot$er source. Question ). 8oes 8o#ini/ue $a,e a cause o" action against @ar%cas$3 A. 6es, *ecause *& $a,ing t$e *ui!%ing %e#o!is$e%, s$e accepte% @ar%cas$2s o""er to #a0e t$e !oan. B. 6es, *ecause $er re!iance on @ar%cas$2s pro#ise 'as su*stantia!, reasona*!e, an% "oreseea*!e. C. No, *ecause t$ere 'as no *argaine% "or e1c$ange o" consi%eration "or @ar%cas$2s pro#ise to #a0e t$e !oan. 8. No, *ecause 8o#ini/ue2s ina*i!it& to o*tain a !oan "ro# an& ot$er source %e#onstrate% t$at t$e pro7ect !ac0e% t$e "inancia! soun%ness t$at 'as a constructi,e con%ition to @ar%cas$2s per"or#ance. Question )1 ?or t$is /uestion on!&, assu#e t$at 8o#ini/ue $as a cause o" action against @ar%cas$. I" s$e sues $i# "or #onetar& re!ie", '$at is t$e pro*a*!e #easure o" $er reco,er&3 A. E1pectanc& %a#ages, #easure% *& t$e %i""erence *et'een t$e ,a!ue o" t$e ne' *ui!%ing an% t$e o!% *ui!%ing, !ess t$e a#ount o" t$e propose% !oan 4-1......5. B. E1pectanc& %a#ages, #easure% *& t$e esti#ate% pro"its "ro# operating t$e propose% sporting goo%s store "or ten &ears, !ess t$e cost o" repa&ing a -1..,... !oan at 1.; interest o,er ten &ears. C. Re!iance %a#ages, #easure% *& t$e -1.,... e1pense o" re#o,ing t$e o!% *ui!%ing, a%7uste% *& t$e %ecrease or increase in t$e #ar0et ,a!ue o" 8o#ini/ue2s !an% i##e%iate!& t$erea"ter. 8. No#ina! %a#ages on!&, *ecause *ot$ e1pectanc& an% re!iance %a#ages are specu!ati,e, an% t$ere is no !ega! or e/uita*!e *asis "or a'ar%ing restitution. 1D(. Aastre!, a notorious spen%t$ri"t '$o 'as usua!!& *ro0e "or t$at reason, recei,e% t$e "o!!o'ing !etter "ro# $is Unc!e Bu!!ion, a 'ea!t$& an% pru%ent #anH I un%erstan% &ou2re in "inancia! %i""icu!ties again. I pro#ise to gi,e &ou -+,... on &our *irt$%a& ne1t #ont$, *ut &ou2% *etter use it 'ise!& or &ou2!! ne,er get anot$er %i#e "ro# #e. Aastre! t$ereupon signe% a contract 'it$ a car %ea!er to purc$ase a -).,... auto#o*i!e an% to #a0e a -+,... %o'n pa&#ent on t$e %a& a"ter $is *irt$%a&. I" Aastre! sues Bu!!ion "or -+,... a"ter t$e !atter !earne% o" t$e car9purc$ase contract an% t$en repu%iate% $is pro#ise, '$ic$ o" t$e "o!!o'ing is Bu!!ion2s *est %e"ense3 4A5 4B5 4C5 A pro#ise to #a0e a gi"t in t$e "uture is not en"orcea*!e. Re!iance *& t$e pro#isee on a pro#ise to #a0e a "uture gi"t %oes not #a0e t$e pro#ise en"orcea*!e un!ess t$e ,a!ue o" t$e pro#ise% gi"t is su*stantia!!& e/ui,a!ent to t$e pro#isee2s !oss *& re!iance. Re!iance *& t$e pro#isee on a pro#ise to #a0e a "uture gi"t %oes not #a0e t$e pro#ise en"orcea*!e un!ess t$at re!iance a!so resu!ts in an econo#ic *ene"it to t$e pro#isor.

485

Re!iance *& t$e pro#isee on a pro#ise to #a0e a "uture gi"t %oes not #a0e t$e pro#ise en"orcea*!e un!ess in7ustice can *e a,oi%e% on!& *& suc$ en"orce#ent.

)1.

8e'ar, a %e,e!oper, nee%ing a 'ater 'e!! on one o" $is pro7ects, #et se,era! ti#es a*out t$e #atter 'it$ Aater#an, a 'e!! %ri!!er. Su*se/uent!&, Aater#an sent 8e'ar an unsigne% t&pe'ritten "or# captione% AEFF 8RIFFING >RO>OSAF an% stating ,arious ter#s t$e t'o $a% %iscusse% *ut not agree% upon, inc!u%ing a propose% price o" -+,.... T$e "or# conc!u%e%, T$is proposa! 'i!! not *eco#e a contract unti! signe% *& &ou I8e'arJ an% t$en returne% to an% signe% *& #e IAater#anJ. 8e'ar signe% t$e "or# an% returne% it to Aater#an, '$o neg!ecte% to sign it *ut pro#pt!& *egan %ri!!ing t$e 'e!! at t$e propose% site on 8e'ar2s pro7ect. A"ter %ri!!ing "or t'o %a&s, Aater#an to!% 8e'ar %uring one o" 8e'ar2s %ai!& ,isits t$at $e 'ou!% not "inis$ un!ess 8e'ar 'ou!% agree to pa& t'ice t$e price recite% in t$e 'ritten proposa!. 8e'ar re"use%, Aater#an /uit, an% 8e'ar $ire% Su**o to %ri!! t$e 'e!! to co#p!etion "or a price o" -D,+... In an action *& 8e'ar against Aater#an "or %a#ages, '$ic$ o" t$e "o!!o'ing is t$e pro*a*!e %ecision3 4A5 4B5 4C5 485 8e'ar 'ins, *ecause $is signing o" Aater#an2s "or# constitute% an acceptance o" an o""er *& Aater#an. 8e'ar 'ins, *ecause Aater#an2s co##ence#ent o" per"or#ance constitute% an acceptance *& Aater#an o" an o""er *& 8e'ar an% an i#p!ie% pro#ise *& Aater#an to co#p!ete t$e 'e!!. Aater#an 'ins, *ecause $e ne,er signe% t$e proposa! as re/uire% *& its ter#s. Aater#an 'ins, *ecause $is co##ence#ent o" per"or#ance #ere!& pre,ente% 8e'ar "ro# re,o0ing $is o""er, #a%e on a "or# supp!ie% *& Aater#an, an% %i% not o*!igate Aater#an to co#p!ete t$e 'e!!.

D:.

Barre!, a retai!er o" guns in State K, U.S.A., recei,e% on <une 1 t$e "o!!o'ing signe% !etter "ro# S!i%e*o!t, a gun9'$o!esa!er in anot$er stateH Ae $a,e 7ust o*taine% 1.. o" t$e assau!t ri"!es &ou in/uire% a*out an% can supp!& t$e# "or -2+. eac$. Ae can guarantee s$ip#ent no !ater t$an August 1. On <une 1., S!i%e*o!t so!% an% %e!i,ere% t$e sa#e ri"!es to anot$er #erc$ant "or -=.. eac$. Una'are o" t$at transaction, Barre! on t$e #orning o" <une 11 #ai!e% S!i%e*o!t a !etter re7ecting t$e !atter2s o""er, *ut, c$anging $is #in% an $our !ater, retrie,e% "ro# $is !oca! post o""ice t$e !etter o" re7ection an% i##e%iate!& %ispatc$e% to S!i%e*o!t a !etter o" acceptance, '$ic$ S!i%e*o!t recei,e% on <une 1). On <une E, a ,a!i% "e%era! statute #a0ing t$e interstate sa!e o" assau!t ri"!es punis$a*!e as a cri#e $a% *eco#e e""ecti,e, *ut neit$er Barre! nor S!i%e*o!t 'as a'are unti! <une 1+ t$at t$e statute 'as a!rea%& in e""ect. As *et'een Barre! an% S!i%e*o!t, '$ic$ o" t$e "o!!o'ing is an accurate state#ent3 4A5 4B5 4C5 485 No contract 'as "or#e%, *ecause S!i%e*o!t2s <une 1. sa!e o" t$e ri"!es to anot$er #erc$ant re,o0e% t$e o""er to Barre!. I" a contract 'as "or#e%, it is ,oi%a*!e *ecause o" #utua! #ista0e. I" a contract 'as "or#e%, it is unen"orcea*!e *ecause o" super,ening i#practica*i!it&. No contract 'as "or#e%, *ecause Barre!2s <une 11 re7ection 'as e""ecti,e on %ispatc$.

Questions E:9ED are *ase% on t$e "o!!o'ing "act situation. Bett& Bo'er, an a%u!t, as0e% <e"" Geetus to !en% $er -1,.... Geetus rep!ie% t$at $e 'ou!% %o so on!& i" Bo'er2s "at$er, Cas$, 'ou!% guarantee t$e !oan. At Bo'er2s re/uest, Cas$ #ai!e% a signe% !etter to GeetusH I" &ou !en% -1,... to #& %aug$ter, I 'i!! repa& it i" s$e %oesn2t. On Septe#*er 1+, Geetus, $a,ing rea% Cas$2s !etter, !en% -1,... to Bo'er, '$ic$ Bo'er agree% to repa& in insta!!#ents o" -1.. p!us accrue% interest on t$e !ast %a& o" eac$ #ont$ *eginning Octo*er =1. Cas$ %ie% on Septe#*er 1:. Fater t$at sa#e %a&, una'are o" Cas$2s %eat$, Geetus #ai!e% a !etter to Cas$ a%,ising t$at $e $a% #a%e t$e -1,... !oan to Bo'er on Septe#*er 1+. Bo'er %i% not pa& t$e insta!!#ents %ue on Octo*er =1, No,e#*er =., or 8ece#*er =1, an% $as in"or#e% Geetus t$at s$e 'i!! *e una*!e to #a0e repa&#ents in t$e "oreseea*!e "uture. ED. ?or t$is /uestion on!&, assu#e t$at Bo'er2s entire -1,... %e*t is %ue an% t$at s$e $as "ai!e% to repa& an& part o" it. In an action *& Geetus against Cas$2s estate "or -1,... p!us accrue% interest, '$ic$ o" t$e "o!!o'ing, i" an&, 'i!! ser,e as 4an5 e""ecti,e %e"ense4s5 "or Cas$2s estate3 I. II. III. 4A5 4B5 4C5 485 T$ere 'as no consi%eration to support Cas$2s pro#ise, *ecause $e %i% not recei,e an& *ene"it. Cas$ %ie% *e"ore Geetus accepte% $is o""er. Cas$ %ie% *e"ore Geetus noti"ie% $i# t$at $is o""er $a% *een accepte%. I on!&. II on!&. I an% III on!&. Neit$er 1 nor II nor III.

Questions 1(+91(: are *ase% on t$e "o!!o'ing "act situation. Mura!, a 'a!!paper $anger, sent Genn&*e!!e, a genera! contractor, t$is te!egra#H Ai!! %o a!! paper$anging on ne' 8octors2 Bui!%ing, per o'ner2s specs, "or -1),... i" &ou accept 'it$in reasona*!e ti#e a"ter #ain contract a'ar%e%. LsL Mura! T$ree ot$er co#peting $angers sent Genn&*e!!e si#i!ar *i%s in t$e respecti,e a#ounts o" -1(,..., -1E,... an% -2.,.... Genn&*e!!e use% Mura!2s -1),... "igure in preparing an% su*#itting $er o'n sea!e% *i% on 8octors2 Bui!%ing. Be"ore t$e *i%s 'ere opene%, Mura! trut$"u!!& a%,ise% Genn&*e!!e t$at t$e "or#er2s te!egrap$ic su*9*i% $a% *een *ase% on a -),... co#putationa! error an% 'as t$ere"ore re,o0e%. S$ort!& t$erea"ter, Genn&*e!!e 'as a'ar%e% t$e 8octors2 Bui!%ing construction contract an% su*se/uent!& contracte% 'it$ anot$er paper$anger "or a price o" -1(,.... Genn&*e!!e no' sues Mura! to reco,er -),.... 1(+. A$ic$ o" t$e "o!!o'ing, i" pro,e%, 'ou!% #ost strengt$en Genn&*e!!e2s prospect o" reco,er&3 4A5 4B5 4C5 A"ter Mura!2s notice o" re,ocation, Genn&*e!!e #a%e a reasona*!e e""ort to su*contract 'it$ anot$er paper$anger at t$e !o'est possi*!e price. Genn&*e!!e $a% *een re/uire% *& t$e o'ner to su*#it a *i% *on% an% cou!% not $a,e 'it$%ra'n or a#en%e% $er *i% on t$e #ain contract 'it$out "or"eiting t$at *on%. Mura! 'as neg!igent in erroneous!& ca!cu!ating t$e a#ount o" $is su*9*i%.

485 1(:.

Genn&*e!!e %ea!t 'it$ a!! o" $er su*contractors in goo% "ait$ an% 'it$out see0ing to renegotiate 4!o'er5 t$e prices t$e& $a% *i%.

A$ic$ o" t$e "o!!o'ing, i" pro,e%, 'ou!% *est support Mura!2s %e"ense3 4A5 4B5 4C5 485 Genn&*e!!e ga,e Mura! no consi%eration "or an irre,oca*!e su*9*i%. Mura!2s su*9*i% e1press!& re/ueste% Genn&*e!!e2s acceptance a"ter a'ar%ing o" t$e #ain contract. E,en a"ter pa&ing -1(,... "or t$e paper$anging, Genn&*e!!e 'ou!% #a0e a net pro"it o" -1..,... on t$e 8octors2 Bui!%ing contract. Be"ore su*#itting $er o'n *i%, Genn&*e!!e $a% reason to suspect t$at Mura! $a% #a%e a co#putationa! #ista0e in "iguring $is su*9*i%.

REME8IES D. S'atter, a *ase*a!! star, contracte% 'it$ t$e Municipa! S&#p$on& Orc$estra, Inc., to per"or# "or -+,... at a c$i!%ren2s concert as narrator o" >eter an% t$e Ao!". S$ort!& *e"ore t$e concert, S'atter *eca#e e#*roi!e% in a $ig$!& pu*!iciCe% contro,ers& o,er '$et$er $e $a% curse% an% assau!te% a *ase*a!! "an. T$e orc$estra cance!e% t$e contract out o" concern t$at atten%ance #ig$t *e a%,erse!& a""ecte% *& S'atter2s appearance. S'atter sue% t$e orc$estra "or *reac$ o" contract. @is *usiness agent testi"ie% 'it$out contra%iction t$at t$e cance!!ation $a% resu!te% in S'atter2s not getting ot$er contracts "or per"or#ances an% en%orse#ents. T$e tria! court instructe% t$e 7ur&, in part, as "o!!o'sH I" &ou "in% "or t$e p!ainti"", &ou #a& a'ar% %a#ages "or !osses '$ic$ at t$e ti#e o" contracting cou!% reasona*!& $a,e *een "oreseen *& t$e %e"en%ant as a pro*a*!e resu!t o" its *reac$. @o'e,er, t$e !a' %oes not per#it reco,er& "or t$e !oss o" prospecti,e pro"its o" a ne' *usiness cause% *& *reac$ o" contract. On S'atter2s appea! "ro# a 7ur& ,er%ict "or S'atter, an% 7u%g#ent t$ereon, a'ar%ing %a#ages on!& "or t$e -+,... "ee pro#ise% *& t$e orc$estra, t$e 7u%g#ent 'i!! pro*a*!& *e 4A5 4B5 4C5 485 a""ir#e%, *ecause t$e tria! court state% t$e !a' correct!&. a""ir#e%, *ecause t$e issue o" %a#ages "or *reac$ o" contract 'as so!e!& a 7ur& /uestion. re,erse%, *ecause t$e test "or !i#iting %a#ages is '$at t$e *reac$ing part& cou!% reasona*!& $a,e "oreseen at t$e ti#e o" t$e *reac$. re,erse%, *ecause un%er t$e pre,ai!ing #o%ern ,ie', !ost pro"its o" a ne' *usiness are reco,era*!e i" t$e& are esta*!is$e% 'it$ reasona*!e certaint&.

Questions 1:=91:) are *ase% on t$e "o!!o'ing "act situation. Green contracte% in a signe% 'riting to se!! Greenacre, a +..9acre tract o" "ar#!an%, to ?ar#er. T$e contract pro,i%e% "or e1c$ange o" t$e %ee% an% purc$ase price o" -+..,... in cas$ on <anuar& 1+. >ossession 'as to *e gi,en to ?ar#er on t$e sa#e %ate. On <anuar& 1+, Green noti"ie% ?ar#er t$at *ecause t$e tenant on Greenacre 'rong"u!!& re"use% to /uit t$e pre#ises unti! <anuar& =., Green 'ou!% *e una*!e to %e!i,er possession o" Greenacre unti! t$en, *ut $e assure% ?ar#er t$at $e 'ou!% ten%er t$e %ee% an% possession on t$at %ate. A$en Green ten%ere% t$e %ee% an% possession on <anuar& =., ?ar#er re"use% to accept eit$er, an% re"use% to pa& t$e -+..,.... T$roug$out t$e #ont$ o" <anuar&, t$e #ar0et ,a!ue o" Greenacre 'as -+1.,... an% its "air #ont$!& renta! ,a!ue 'as -+,....

1:=.

Ai!! Green pro*a*!& succee% in an action against ?ar#er "or speci"ic per"or#ance3 4A5 4B5 4C5 485 &es, *ecause t$e court 'i!! e1cuse t$e %e!a& in ten%er on t$e groun% t$at t$ere 'as a te#porar& i#possi*i!it& cause% *& t$e tenant2s $o!%ing o,er. 6es, *ecause ti#e is or%inari!& not o" t$e essence in a !an%9sa!e contract. No, *ecause Green *reac$e% *& "ai!ing to ten%er t$e %ee% an% possession on <anuar& 1+. No, *ecause Green2s re#e%& at !a' "or #onetar& re!ie" is a%e/uate.

1:).

?or t$is /uestion on!&, #a0e t$e "o!!o'ing assu#ptions. On <anuar& =., ?ar#er accepte% a con,e&ance an% possession o" Greenacre an% pai% t$e -+..,... purc$ase price, *ut noti"ie% Green t$at $e 'as reser,ing an& rig$ts $e #ig$t $a,e to %a#ages cause% *& Green2s *reac$. ?ar#er inten%e% to use t$e !an% "or raising catt!e an% $a% entere% into a contract "or t$e purc$ase o" +.. $ea% o" catt!e to *e %e!i,ere% to Greenacre on <anuar& 1+. Because $e %i% not $a,e possession o" Greenacre on t$at %ate, $e $a% to rent anot$er pasture at a cost o" -2,... to graCe t$e catt!e "or 1+ %a&s. Green $a% no reason to 0no' t$at ?ar#er inten%e% to use Greenacre "or raising catt!e or t$at $e 'as purc$asing catt!e to *e graCe% on Greenacre. In an action *& ?ar#er against Green "or %a#ages, ?ar#er is entit!e% to reco,er 4A5 4B5 4C5 485 not$ing, *ecause *& pa&ing t$e purc$ase price on <anuar& =., $e 'ai,e% '$ate,er cause o" action $e #a& $a,e $a%. no#ina! %a#ages on!&, *ecause t$e #ar0et ,a!ue o" t$e !an% e1cee%e% t$e contract price. -2,+.. on!& 4t$e "air renta! ,a!ue o" Greenacre "or 1+ %a&s5. -2,+.. 4t$e "air renta! ,a!ue o" Greenacre "or 1+ %a&s5, p!us -2,... 4t$e cost o" graCing t$e catt!e e!se'$ere "or 1+ %a&s5.

Questions )9+ are *ase% on t$e "o!!o'ing "act situation. Structo contracte% 'it$ Bai!e& to construct "or -+..,... a 'are$ouse an% an access %ri,e'a& at $ig$'a& !e,e!. S$ort!& a"ter co##encing 'or0 on t$e %ri,e'a&, '$ic$ re/uire% "or t$e speci"ie% !e,e! so#e e1ca,ation an% re#o,a! o" sur"ace #ateria!, Structo une1pecte%!& encountere% a !arge #ass o" so!i% roc0. Question ) ?or t$is /uestion on!&, assu#e t$e "o!!o'ing "acts. Structo in"or#e% Bai!e& 4accurate!&5 t$at *ecause o" t$e roc0 t$e %ri,e'a& as speci"ie% 'ou!% cost at !east -2.,... #ore t$an "igure%, an% %e#an%e% "or t$at reason a tota! contract price o" -+2.,.... Since Bai!e& 'as e1pecting 'are$ousing custo#ers i##e%iate!& a"ter t$e agree% co#p!etion %ate, $e signe% a 'riting pro#ising to pa& t$e a%%itiona! -2.,.... ?o!!o'ing ti#e!& co#p!etion o" t$e 'are$ouse an% %ri,e'a&, '$ic$ con"or#e% to t$e contract in a!! respects, Bai!e& re"use% to pa& Structo #ore t$an -+..,.... A$at is t$e #a1i#u# a#ount to '$ic$ Structo is entit!e%3 A. -+..,..., *ecause t$ere 'as no consi%eration "or Bai!e&2s pro#ise to pa& t$e a%%itiona! -2.,.... B. -+..,..., *ecause Bai!e&2s pro#ise to pa& t$e a%%itiona! -2.,... 'as e1acte% un%er %uress. C. -+2.,..., *ecause t$e #o%i"ication 'as "air an% 'as #a%e in t$e !ig$t o" circu#stances not anticipate% *& t$e parties '$en t$e origina! contract 'as #a%e. 8. -+2.,..., pro,i%e% t$at t$e reasona*!e ,a!ue o" Structo2s tota! per"or#ance 'as t$at #uc$ or #ore.

Question + ?or t$is /uestion on!&, assu#e t$e "o!!o'ing "acts. Upon encountering t$e roc0 "or#ation, Structo, instea% o" incurring a%%itiona! costs to re#o,e it, *ui!t t$e access %ri,e'a& o,er t$e roc0 'it$ a steep gra%e %o'n to t$e $ig$'a&. Bai!e&, '$o 'as out o" to'n "or se,era! %a&s, 'as una'are o" t$is noncon"or#it& unti! t$e %ri,e'a& $a% *een "inis$e%. As *ui!t, it is too steep to *e use% sa"e!& *& truc0s or cars, particu!ar!& in t$e 'et or ic& 'eat$er "re/uent!& occurring in t$e area. It 'ou!% cost -=.,... to tear out an% re*ui!% t$e %ri,e'a& at $ig$'a& !e,e!. As *ui!t, t$e 'are$ouse, inc!u%ing t$e %ri,e'a&, $as a "air #ar0et ,a!ue o" -++.,.... Bai!e& $as pai% -)D.,... to Structo, *ut re"uses to pa& #ore *ecause o" t$e noncon"or#ing %ri,e'a&, '$ic$ Structo $as re"use% to tear out an% re*ui!%. I" Structo sues Bai!e& "or #onetar& re!ie", '$at is t$e #a1i#u# a#ount Structo is entit!e% to reco,er3 A. -=.,..., *ecause t$e "air #ar0et ,a!ue o" t$e 'are$ouse an% %ri,e'a& as is e1cee%s t$e contract price *& -+.,... 4#ore t$an t$e cost o" correcting t$e %ri,e'a&5. B. -=.,..., *ecause Structo su*stantia!!& per"or#e% an% t$e cost o" correcting t$e %ri,e'a& 'ou!% in,o!,e econo#ic 'aste. C. -=.,..., #inus '$ate,er a#ount Structo sa,e% *& not *ui!%ing t$e %ri,e'a& at t$e speci"ie% !e,e!. 8. Not$ing, *ecause Bai!e& is entit!e% to %a#ages "or t$e cost o" correcting t$e %ri,e'a&. Questions (:9(D are *ase% on t$e "o!!o'ing "act situation. Mer#ai% o'ns an e1ceptiona!!& sea'ort$& *oat t$at s$e c$arters "or sport "is$ing at a -+.. %ai!& rate. T$e "ee inc!u%es t$e use o" t$e *oat 'it$ Mer#ai% as t$e captain, an% one ot$er cre' #e#*er, as 'e!! as "is$ing tac0!e an% *ait. On Ma& 1, >$inne& agree% 'it$ Mer#ai% t$at >$inne& 'ou!% $a,e t$e "u!!9%a& use o" t$e *oat on Ma& 1+ "or $i#se!" an% $is "a#i!& "or -+... >$inne& pai% an a%,ance %eposit o" -2.. an% signe% an agree#ent t$at t$e %eposit cou!% *e retaine% *& Mer#ai% as !i/ui%ate% %a#ages in t$e e,ent >$inne& cance!e% or "ai!e% to appear. Question (: ?or t$is /uestion on!&, assu#e t$e "o!!o'ing "acts. At t$e ti#e o" contracting, Mer#ai% to!% >$inne& to *e at t$e %oc0 at + a.#. on Ma& 1+. >$inne& an% $is "a#i!&, $o'e,er, %i% not s$o' up on Ma& 1+ unti! noon. Meanti#e, Mer#ai% agree% at 1. a.#. to ta0e Tess an% $er "a#i!& out "is$ing "or t$e rest o" t$e %a&. Tess $a% $appene% to co#e *& an% in/uire a*out t$e possi*i!it& o" suc$ an outing. In ,ie' o" t$e !ate $our, Mer#ai% c$arge% Tess -).. an% sta&e% out t'o $ours *e&on% t$e custo#ar& return ti#e. >$inne&2s "ai!ure to appear unti! noon 'as %ue to t$e "act t$at $e $a% *een tr&ing to c$arter anot$er *oat across t$e *a& at a !o'er rate an% $a% gotten !ost a"ter $e 'as unsuccess"u! in getting suc$ a c$arter. A$ic$ o" t$e "o!!o'ing is an accurate state#ent concerning t$e rig$ts o" t$e parties3 A. Mer#ai% can retain t$e -2.. pai% *& >$inne&, *ecause it 'ou!% *e %i""icu!t "or Mer#ai% to esta*!is$ $er actua! %a#ages an% t$e su# appears to $a,e *een a reasona*!e "orecast in !ig$t o" anticipate% !oss o" pro"it "ro# t$e c$arter. B. Mer#ai% is entit!e% to retain on!& -+. 41.; o" t$e contract price5 an% #ust return -1+. to >$inne&. C. Mer#ai% #ust return -1.. to >$inne& in or%er to a,oi% $er o'n un7ust enric$#ent at >$inne&2s e1pense. 8. Mer#ai% #ust return -1.. to >$inne&, *ecause t$e !i/ui%ate% %a#age c!ause un%er t$e circu#stances 'ou!% operate as a pena!t&.

Question (D ?or t$is /uestion on!&, assu#e t$e "o!!o'ing "acts. On Ma& 1+ at 1 a.#., t$e Coast Guar% $a% issue% o""s$ore $ea,& 'eat$er 'arnings an% pro$i*ite% a!! s#a!! ,esse!s t$e siCe o" Mer#ai%2s "ro# !ea,ing t$e $ar*or. T$is pro$i*ition re#aine% in e""ect t$roug$out t$e %a&. >$inne& %i% not appear at a!! on Ma& 1+, *ecause $e $a% $ear% t$e 'eat$er 'arnings on $is ra%io. A$ic$ o" t$e "o!!o'ing is an accurate state#ent3 A. T$e contract is %isc$arge% *ecause o" i#possi*i!it&, an% >$inne& is entit!e% to return o" $is %eposit. B. T$e contract is %isc$arge% *ecause o" #utua! #ista0e concerning an essentia! "act, an% >$inne& is entit!e% to return o" $is %eposit. C. T$e contract is not %isc$arge%, *ecause its per"or#ance 'as possi*!e in ,ie' o" t$e e1ceptiona! sea'ort$iness o" Mer#ai%2s *oat, an% >$inne& is not entit!e% to return o" $is %eposit. 8. T$e contract is not %isc$arge%, an% >$inne& is not entit!e% to return o" $is %eposit, *ecause t$e !i/ui%ate%9%a#age c!ause in e""ect a!!ocate% t$e ris0 o" *a% 'eat$er to >$inne&.

Questions 1E an% 2. are *ase% on t$e "o!!o'ing "act situation. In a sing!e 'riting, >ainter contracte% 'it$ ?ar#er to paint t$ree i%entica! *arns on $er rura! estate "or -2,... eac$. T$e contract pro,i%e% "or ?ar#er2s pa&#ent o" -:,... upon >ainter2s co#p!etion o" t$e 'or0 on a!! t$ree *arns. >ainter %i% not as0 "or an& pa&#ent '$en t$e "irst *arn 'as co#p!ete!& painte%, *ut s$e %e#an%e% -),... a"ter painting t$e secon% *arn.
Question 1E Is ?ar#er o*!igate% to #a0e t$e -),... pa&#ent3 A. No, *ecause ?ar#er $as no, %ut& un%er t$e contract to pa& an&t$ing to >ainter unti! a!! t$ree *arns $a,e *een painte%. B. No, *ecause >ainter 'ai,e% $er rig$t, i" an&, to pa&#ent on a per9*arn *asis *& "ai!ing to %e#an% -2,... upon co#p!etion o" t$e "irst *arn. C. 6es, *ecause t$e contract is %i,isi*!e. 8. 6es, *ecause >ainter $as su*stantia!!& per"or#e% t$e entire contract. Question 2. ?or t$is /uestion on!&, assu#e t$at ?ar#er rig$t"u!!& re"use% >ainter2s %e#an% "or pa&#ent. I" >ainter i##e%iate!& ter#inates t$e contract 'it$out painting t$e t$ir% *arn, '$at is >ainter entit!e% to reco,er "ro# ?ar#er3 A. Not$ing, *ecause pa&#ent 'as e1press!& con%itione% on co#p!etion o" a!! t$ree *arns. B. >ainter2s e1pen%itures p!us anticipate% pro"it in painting t$e "irst t'o *arns, up to a #a1i#u# reco,er& o" -),.... C. T$e reasona*!e ,a!ue o" >ainter2s ser,ices in painting t$e t'o *arns, !ess ?ar#er2s %a#ages, i" an&, "or >ainter2s "ai!ure to paint t$e t$ir% *arn. 8. T$e a#ount t$at t$e co#*ine% ,a!ue o" t$e t'o painte% *arns $as *een increase% *& >ainter2s 'or0.

Questions 12E991=. are *ase% on t$e "o!!o'ing "act situation. On Apri! 1, O'ner an% Bu&er signe% a 'riting in '$ic$ O'ner, in consi%eration o" -1.. to *e pai% to O'ner *& Bu&er, o""ere% Bu&er t$e rig$t to purc$ase Greenacre "or -1..,... 'it$in =. %a&s. T$e 'riting "urt$er pro,i%e%, T$is o""er 'i!! *eco#e e""ecti,e as an option on!& i" an% '$en t$e -1.. consi%eration is in "act pai%. On Apri! 2., O'ner, $a,ing recei,e% no pa&#ent or ot$er co##unication "ro# Bu&er, so!% an% con,e&e% Greenacre to CitiCen "or -12.,.... On Apri! 21, O'ner recei,e% a !etter "ro# Bu&er enc!osing a cas$ier2s c$ec0 "or -1.. pa&a*!e to O'ner an% stating, I a# $ere*& e1ercising #& option to purc$ase Greenacre an% a# prepare% to c!ose '$ene,er &ou2re rea%&. Question 12E A$ic$ o" t$e "o!!o'ing, i" pro,e%, *est supports Bu&er2s suit against O'ner "or *reac$ o" contract3 A. Bu&er 'as una'are o" t$e sa!e to CitiCen '$en O'ner recei,e% t$e !etter an% c$ec0 "ro# Bu&er on Apri! 21. B. On Apri! 1+, Bu&er %eci%e% to purc$ase Greenacre, an% app!ie% "or an% o*taine% a co##it#ent "ro# Ban0 "or a -D+,... !oan to $e!p "inance t$e purc$ase. C. A$en t$e Apri! 1 'riting 'as signe%, O'ner sai% to Bu&er, 8on2t 'orr& a*out t$e -1..G t$e recita! o" M-1.. to *e pai%2 #a0es t$is %ea! *in%ing. 8. O'ner an% Bu&er are *ot$ pro"essiona! %ea!ers in rea! estate. Question 1=. ?or t$is /uestion on!&, assu#e t$at, "or '$ate,er reason, Bu&er pre,ai!s in t$e suit against O'ner. A$ic$ o" t$e "o!!o'ing is Bu&er entit!e% to reco,er3 A. No#ina! %a#ages on!&, *ecause t$e re#e%& o" speci"ic per"or#ance 'as not a,ai!a*!e to Bu&er. B. T$e "air #ar0et ,a!ue, i" an&, o" an assigna*!e option to purc$ase Greenacre "or -1..,.... C. -2.,..., p!us t$e a#ount, i" an&, *& '$ic$ t$e "air #ar0et ,a!ue o" Greenacre on t$e %ate o" O'ner2s *reac$ e1cee%e% -12.,.... 8. T$e a#ount, i" an&, *& '$ic$ t$e "air #ar0et ,a!ue o" Greenacre on t$e %ate o" O'ner2s *reac$ e1cee%e% -1..,.... Question 1)2 ?or t$is /uestion on!&, assu#e t$e "o!!o'ing "acts. On Octo*er 1, Bu&er to!% Se!!er, I2# increasing!& un$app& a*out our <une 1 contract *ecause o" t$e current catt!e #ar0et, an% %o not inten% to *u& &our ranc$ un!ess I2# !ega!!& o*!igate% to %o so. I" Se!!er sues Bu&er on Octo*er 1+ "or *reac$ o" contract, Se!!er 'i!! pro*a*!& A. 'in, *ecause Bu&er co##itte% a tota! *reac$ *& anticipator& repu%iation on Octo*er 1. B. 'in, *ecause Bu&er2s Octo*er 1 state#ent create% reasona*!e groun%s "or Se!!er2s insecurit& 'it$ respect to Bu&er2s per"or#ance. C. !ose, *ecause t$e parties contracte% "or t$e sa!e an% con,e&ance o" a sing!e tract, an% Se!!er cannot *ring suit "or *reac$ o" suc$ a contract prior to t$e agree% c!osing %ate. 8. !ose, *ecause Bu&er2s Octo*er 1 state#ent to Se!!er 'as neit$er a repu%iation nor a present *reac$ o" t$e <une 1 contract. Question 1)=

?or t$is /uestion on!&, assu#e t$e "o!!o'ing "acts. Bu&er une/ui,oca!!& repu%iate% t$e contract on August 1. On August 1+, Se!!er urge% Bu&er to c$ange $er #in% an% procee% 'it$ t$e sc$e%u!e% c!osing on 8ece#*er 1. On Octo*er 1, $a,ing $ear% not$ing "urt$er "ro# Bu&er, Se!!er so!% an% con,e&e% $is ranc$ to Ranc$er 'it$out notice to Bu&er. On 8ece#*er 1, Bu&er atte#pte% to c!ose un%er t$e <une I contract *& ten%ering t$e "u!! purc$ase price to Se!!er. Se!!er re7ecte% t$e ten%er. I" Bu&er sues Se!!er "or *reac$ o" contract, Bu&er 'i!! pro*a*!& A. 'in, *ecause Se!!er "ai!e% seasona*!& to noti"& Bu&er o" an& pen%ing sa!e to Ranc$er. B. 'in, *ecause Se!!er 'ai,e% Bu&er2s August 1 repu%iation *& urging $er to retract it on August 1+. C. !ose, *ecause Bu&er %i% not retract $er repu%iation *e"ore Se!!er #ateria!!& c$ange% $is position in re!iance t$ereon *& se!!ing t$e ranc$ to Ranc$er. 8. !ose, *ecause acceptance o" t$e purc$ase price *& Se!!er 'as a concurrent con%ition to Se!!er2s o*!igation to con,e& t$e ranc$ to Bu&er on 8ece#*er 1. Question 1)+ Nontractor agree% to *ui!% a po'er p!ant "or a pu*!ic uti!it&. Su**o agree% 'it$ Nontractor to !a& t$e "oun%ation "or -2..,.... Su**o supp!ie% goo%s an% ser,ices 'ort$ -1+.,..., "or '$ic$ Nontractor #a%e progress pa&#ents aggregating -1..,... as re/uire% *& t$e su*contract. Su**o t$en *reac$e% *& re"using un7usti"ia*!& to per"or# "urt$er. Nontractor reasona*!& spent -12.,... to $a,e t$e 'or0 co#p!ete% *& anot$er su*contractor. Su**o sues Nontractor "or t$e reasona*!e ,a!ue o" *ene"its con"erre%, an% Nontractor counterc!ai#s "or *reac$ o" contract. A$ic$ o" t$e "o!!o'ing s$ou!% *e t$e court2s %ecision3 A. Su**o reco,ers -+.,..., t$e *ene"it con"erre% on Nontractor "or '$ic$ Su**o $as not *een pai%. B. Su**o reco,ers -=.,..., t$e *ene"it Su**o con"erre% on Nontractor #inus t$e -2.,... in %a#ages incurre% *& Nontractor. C. Nontractor reco,ers -2.,..., t$e e1cess o,er t$e contract price t$at 'as pai% *& Nontractor "or t$e per"or#ance it $a% *argaine% to recei,e "ro# Su**o. 8. Neit$er part& reco,ers an&t$ing, *ecause Su**o co##itte% a #ateria!, une1cuse% *reac$ an% Nontractor recei,e% a -+.,... *ene"it "ro# Su**o "or '$ic$ Su**o $as not *een pai%. Questions ))9)+ are *ase% on t$e "o!!o'ing "act situation. O$ner an% >!anner signe% a %etai!e% 'riting in '$ic$ >!anner, a !an%scape arc$itect, agree% to !an%scape an% rep!ant O$ner2s resi%entia! propert& in accor%ance 'it$ a %esign prepare% *& >!anner an% incorporate% in t$e 'riting. O$ner agree% to pa& -1.,... "or t$e 'or0 upon its co#p!etion. O$ner2s spouse 'as not a part& to t$e agree#ent, an% $a% no o'ners$ip interest in t$e pre#ises. )). ?or t$is /uestion on!&, assu#e t$e "o!!o'ing "acts. S$ort!& *e"ore t$e agree#ent 'as signe%, O$ner an% >!anner ora!!& agree% t$at t$e 'riting 'ou!% not *eco#e *in%ing on eit$er part& un!ess O$ner2s spouse s$ou!% appro,e t$e !an%scaping %esign. I" O$ner2s spouse %isappro,es t$e %esign an% O$ner re"uses to a!!o' >!anner to procee% 'it$ t$e 'or0, is e,i%ence o" t$e ora! agree#ent a%#issi*!e in >!anner2s action against O$ner "or *reac$ o" contract3

4A5 6es, *ecause t$e ora! agree#ent re/uire% appro,a! *& a t$ir% part&. 4B5 6es, *ecause t$e e,i%ence s$o's t$at t$e 'riting 'as inten%e% to ta0e e""ect on!& i" t$e appro,a! occurre%. 4C5 No, *ecause t$e paro! e,i%ence ru!e *ars e,i%ence o" a prior ora! agree#ent e,en i" t$e !atter is consistent 'it$ t$e ter#s o" a partia! integration. 485 No, *ecause t$e prior ora! agree#ent contra%icte% t$e 'riting *& #a0ing t$e parties2 %uties con%itiona!. )+. ?or t$is /uestion on!&, assu#e t$e "o!!o'ing "acts. At O$ner2s insistence, t$e 'ritten O$ner9>!anner agree#ent containe% a pro,ision t$at neit$er part& 'ou!% *e *oun% un!ess O$ner2s !a' partner, an a,i% stu%ent o" !an%scaping, s$ou!% appro,e >!anner2s %esign. Be"ore >!anner co##ence% t$e 'or0, O$ner2s !a' partner, in t$e presence o" *ot$ O$ner an% >!anner, e1press!& %isappro,e% t$e !an%scaping %esign. Ne,ert$e!ess, O$ner or%ere% >!anner to procee% 'it$ t$e 'or0, an% >!anner re!uctant!& %i% so. A$en >!anner2s per"or#ance 'as ).; co#p!ete, O$ner repu%iate% $is %ut&, i" an&, to pa& t$e contract price or an& part t$ereo". I" >!anner no' sues O$ner "or %a#ages "or *reac$ o" contract, '$ic$ o" t$e "o!!o'ing concepts *est supports >!anner2s c!ai#3 4A5 4B5 4C5 485 Su*stantia! per"or#ance. >ro#issor& estoppe!. Irre,oca*!e 'ai,er o" con%ition. Un7ust enric$#ent.

Questions :)9:+ are *ase% on t$e "o!!o'ing "act situation. E!%a, t$e age% #ot$er o" A!ice an% Barr&, *ot$ a%u!ts, 'is$e% to e#p!o& a !i,e9in co#panion so t$at s$e #ig$t continue to !i,e in $er o'n $o#e. E!%a, $o'e,er, $a% on!& enoug$ inco#e to pa& one9$a!" o" t$e co#panion2s -2,... #ont$!& sa!ar&. Fearning o" t$eir #ot$er2s p!ig$t, A!ice an% Barr& agree% 'it$ eac$ ot$er in a signe% 'riting t$at on t$e !ast %a& o" <anuar& an% eac$ succee%ing #ont$ %uring t$eir #ot$er2s !i"eti#e, eac$ 'ou!% gi,e E!%a -+... E!%a t$en $ire% t$e co#panion. A!ice an% Barr& #a%e t$e agree% pa&#ents in <anuar&, ?e*ruar&, an% Marc$. In Apri!, $o'e,er, Barr& re"use% to #a0e an& pa&#ent an% noti"ie% A!ice an% E!%a t$at $e 'ou!% #a0e no "urt$er pa&#ents. :). Ai!! E!%a succee% in an action "or -+.. *roug$t against Barr& a"ter Apri! =.3 4A5 6es, *ecause *& #a0ing $is "irst t$ree pa&#ents, Barr& con"ir#e% $is intent to contract. 4B5 6es, *ecause E!%a is an inten%e% *ene"iciar& o" a contract *et'een A!ice an% Barr&. 4C5 No, *ecause a parent cannot sue $er c$i!% "or *reac$ o" a pro#ise "or support. 485 No, *ecause A!ice an% Barr& inten%e% t$eir pa&#ents to E!%a to *e gi"ts. (E. >ater an% $is a%u!t %aug$ter, Car#en, encountere% Tertius, an o!% "a#i!& "rien%, on t$e street. Car#en sai% to Tertius, @o' a*out !en%ing #e -1,... to *u& a use% car3 I2!! pa& &ou *ac0 'it$ interest one &ear "ro# to%a&. >ater a%%e%, An% i" s$e %oesn2t pa& it *ac0 as pro#ise%, I 'i!!. Tertius t$ereupon 'rote out an% $an%e% to Car#en $is persona! c$ec0, pa&a*!e to $er, "or -1,..., an% Car#en su*se/uent!& use% t$e "un%s to *u& a use% car. A$en t$e %e*t *eca#e %ue, *ot$ Car#en an% >ater re"use% to repa& it, or an& part o" it. In an action *& Tertius against >ater to reco,er -1,... p!us interest, '$ic$ o" t$e "o!!o'ing state#ents 'ou!% su##ariCe >ater2s *est %e"ense3

4A5 @e recei,e% no consi%eration "or $is con%itiona! pro#ise to Tertius. 4B5 @is con%itiona! pro#ise to Tertius 'as not to *e per"or#e% in !ess t$an a &ear "ro# t$e ti#e it 'as #a%e. 4C5 @is con%itiona! pro#ise to Tertius 'as not #a%e "or t$e pri#ar& purpose o" *ene"iting $i#se!" 4>ater5. 485 T$e !oan *& Tertius 'as #a%e 'it$out an& agree#ent concerning t$e app!ica*!e interest rate. 12(. Seisin an% Ben%ee, stan%ing on Greenacre, ora!!& agree% to its sa!e an% purc$ase "or -+,..., an% ora!!& #ar0e% its *oun%s as t$at !ine o" trees %o'n t$ere, t$e %itc$ t$at intersects t$e#, t$e "ence on t$e ot$er si%e, an% t$at street on t$e "ourt$ si%e. In '$ic$ o" t$e "o!!o'ing is t$e re#e%& o" re"or#ation #ost appropriate3 4A5 4B5 4C5 485 As !ater re%uce% to 'riting, t$e agree#ent *& c!erica! #ista0e inc!u%e% t'o acres t$at are actua!!& *e&on% t$e "ence. Ben%ee reasona*!& t$oug$t t$at t'o acres *e&on% t$e "ence 'ere inc!u%e% in t$e ora! agree#ent *ut Seisin %i% not. As !ater re%uce% to 'riting, t$e agree#ent inc!u%e% t$e t'o acres. Ben%ee reasona*!& t$oug$t t$at t$e price ora!!& agree% upon 'as -),+.., *ut Seisin %i% not. As !ater re%uce% to 'riting, t$e agree#ent sai% -+,.... Ben%ee reasona*!& t$oug$t t$at a %i!api%ate% s$e% *ac0e% up against t$e "ence 'as to *e torn %o'n an% re#o,e% as part o" t$e agree#ent, *ut Seisin %i% not. As !ater re%uce% to 'riting, t$e agree#ent sai% not$ing a*out t$e s$e%.

1:..

Stirrup, a ranc$er, an% E/uino1, a "ancier o" $orses, signe% t$e "o!!o'ing 'ritingH ?or -+,..., Stirrup 'i!! se!! to E/uino1 a gra& $orse t$at E/uino1 #a& c$oose "ro# a#ong t$e gra&s on Stirrup2s ranc$. E/uino1 re"use% to accept %e!i,er& o" a gra& $orse ti#e!& ten%ere% *& Stirrup or to c$oose a#ong t$ose re#aining, on t$e groun% t$at %uring t$eir negotiations Stirrup $a% ora!!& agree% to inc!u%e a sa%%!e, 'ort$ -1.., an% a!so to gi,e E/uino1 t$e option to c$oose a gra& or a *ro'n $orse. E/uino1 insiste% on one o" Stirrup2s *ro'n $orses, *ut Stirrup re"use% to part 'it$ an& o" $is *ro'ns or 'it$ t$e sa%%!e as %e#an%e% *& E/uino1. I" E/uino1 sues Stirrup "or %a#ages an% see0s to intro%uce e,i%ence o" t$e a!!ege% ora! agree#ent, t$e court pro*a*!& 'i!! 4A5 4B5 4C5 485 a%#it t$e e,i%ence as to *ot$ t$e sa%%!e an% t$e option to c$oose a *ro'n $orse. a%#it t$e e,i%ence as to t$e sa%%!e *ut not t$e option to c$oose a *ro'n $orse. a%#it t$e e,i%ence as to t$e option to c$oose a *ro'n $orse *ut not t$e pro#ise to inc!u%e t$e sa%%!e. not a%#it an& o" t$e e,i%ence.

Questions :29:= are *ase% on t$e "o!!o'ing "act situation. Aa!0er, '$o 0ne' not$ing a*out $orses, in$erite% A*er!one, a t$oroug$*re% co!t '$ose %isagreea*!e *e$a,ior #a%e $i# a pest aroun% t$e *arn. Aa!0er so!% t$e co!t "or -1,+.. to S$er'oo%, an e1perience% race$orse9trainer '$o 0ne' o" Aa!0er2s ignorance a*out $orses. At t$e ti#e o" sa!e, Aa!0er sai% to S$er'oo%, I $ate to sa& it, *ut t$is $orse is *a%9te#pere% an% not$ing specia!. Question :2

?or t$is /uestion on!&, assu#e t$at soon a"ter t$e sa!e, A*er!one 'on t$ree races an% earne% -)..,... "or S$er'oo%. A$ic$ o" t$e "o!!o'ing a%%itiona! "acts, i" esta*!is$e% *& Aa!0er, 'ou!% *est support $is c$ance o" o*taining rescission o" t$e sa!e to S$er'oo%3 A. Aa!0er %i% not 0no' unti! a"ter t$e sa!e t$at S$er'oo% 'as an e1perience% race$orse9trainer. B. At a pre9sa!e e1ercise session o" '$ic$ S$er'oo% 0ne' t$at Aa!0er 'as not a'are, S$er'oo% c!oc0e% A*er!one in recor%9setting ti#e, "ar surpassing an& pre,ious per"or#ance. C. A*er!one 'as t$e on!& t$oroug$*re% t$at Aa!0er o'ne%, an% Aa!0er %i% not 0no' $o' to e,a!uate &oung an% unteste% race$orses. 8. At t$e ti#e o" t$e sa!e, Aa!0er 'as angr& an% upset o,er an inci%ent in '$ic$ A*er!one $a% reare% an% t$ro'n a ri%er. Question := A$ic$ one o" t$e "o!!o'ing scenarios 'ou!% *est support an action *& S$er'oo%, rat$er t$an Aa!0er, to rescin% t$e sa!e3 A. In $is "irst race a"ter t$e sa!e, A*er!one ga!!ope% to a $uge !ea% *ut %roppe% %ea% 1.. &ar%s "ro# t$e "inis$ !ine *ecause o" a rare congenita! $eart %e"ect t$at 'as un%isco,era*!e e1cept *& autops&. B. A*er!one 'on -+ #i!!ion "or S$er'oo% o,er a t$ree9&ear racing career *ut upon *eing retire% 'as "oun% to *e incura*!& steri!e an% use!ess as a *ree%er. C. A"ter A*er!one $a% 'on t$ree races "or S$er'oo%, it 'as %isco,ere% t$at *& c!erica! error, un0no'n to eit$er part&, A*er!one2s o""icia! *irt$ registration !iste% an un%istinguis$e% race$orse as t$e sire rat$er t$an t$e "a#ous race$orse t$at in "act 'as t$e sire. 8. A 'ee0 a"ter t$e sa!e, A*er!one 'ent *erser0 an% in"!icte% in7uries upon S$er'oo% t$at re/uire% $is $ospita!iCation "or si1 #ont$s an% a "u!! &ear "or $is reco,er&. Question EE Tra'", t$e #anager o" a state "air, contracte% 'it$ Sc$'eine*auc$, a reno'ne% $og *ree%er, to e1$i*it Sc$'eine*auc$2s 'or!% c$a#pion ani#a!, Mega$a'g, "or t$e t$ree 'ee0s o" t$e annua! "air, at t$e conc!usion o" '$ic$ Sc$'eine*auc$ 'ou!% recei,e an $onorariu# o" -=... T'o %a&s *e"ore t$e opening o" t$e "air, Mega$a'g too0 sic0 'it$ *oarsitis, a co##unica*!e %isease a#ong s'ine, an%, un%er t$e app!ica*!e state /uarantine !a', ,er& pro*a*!& cou!% not *e e1$i*ite% "or at !east a #ont$. Upon !earning t$is, Tra'" can !ega!!& pursue '$ic$ o" t$e "o!!o'ing courses o" action 'it$ respect to $is contract 'it$ Sc$'eine*auc$3 A. Suspen% $is o'n per"or#ance, %e#an% assurances "ro# Sc$'eine*auc$, an% treat a "ai!ure *& Sc$'eine*auc$ to gi,e t$e# as an actiona*!e repu%iation. B. Suspen% $is o'n per"or#ance an% reco,er %a#ages "ro# Sc$'eine*auc$ "or *reac$ o" contract un!ess Sc$'eine*auc$ at once supp!ies an un%isease% $og o" e1$i*ition /ua!it& as a su*stitute "or Mega$a'g. C. Ter#inate $is o'n per"or#ance an% treat Mega$a'g2s i!!ness as %isc$arging a!! re#aining %uties un%er t$e contract. 8. Ter#inate t$e contract, *ut on!& i" $e 4Tra'"5 see0s pro#pt!& to o*tain "or t$e e1$i*it a suita*!e su*stitute "or Mega$a'g "ro# anot$er $og o'ner.

Questions 1)191)2 are *ase% on t$e "o!!o'ing "act situation. On No,e#*er 1+, <oiner in a signe% 'riting contracte% 'it$ Ga!!e& "or an agree% price to persona!!& re#o%e! Ga!!e&2s 0itc$en accor%ing to speci"ications pro,i%e% *& Ga!!e&, an% to start 'or0 on 8ece#*er 1. <oiner agree% to pro,i%e a!! #ateria!s "or t$e 7o* in a%%ition to a!! o" t$e !a*or re/uire%. Question 1)1 ?or t$is /uestion on!&, assu#e t$at on No,e#*er 2: <oiner 'it$out !ega! e1cuse repu%iate% t$e contract an% t$at Ga!!e&, a"ter a reasona*!e an% pro!onge% e""ort, cou!% not "in% an&one to re#o%e! $is 0itc$en "or a price appro1i#ating t$e price agree% to *& <oiner. I" one &ear !ater Ga!!e& *rings an action "or speci"ic per"or#ance against <oiner, '$ic$ o" t$e "o!!o'ing 'i!! pro,i%e <oiner 'it$ t$e *est %e"ense3 A. An action "or e/uita*!e re!ie" not *roug$t 'it$in a reasona*!e ti#e is *arre% *& !ac$es. B. Speci"ic per"or#ance is genera!!& not a,ai!a*!e as a re#e%& to en"orce a contractua! %ut& to per"or# persona! ser,ices. C. Speci"ic per"or#ance is genera!!& not a,ai!a*!e as a re#e%& in t$e case o" an anticipator& repu%iation. 8. Speci"ic per"or#ance is not a,ai!a*!e as a re#e%& '$ere e,en no#ina! %a#ages cou!% $a,e *een reco,ere% as a re#e%& at !a'. Question 1)2 ?or t$is /uestion on!&, assu#e t$e "o!!o'ing "acts. On No,e#*er 2:, Ga!!e& 'it$out !ega! e1cuse repu%iate% t$e contract. Not'it$stan%ing Ga!!e&2s repu%iation, $o'e,er, <oiner su*se/uent!& purc$ase% "or -+,... #ateria!s t$at cou!% on!& *e use% in re#o%e!ing Ga!!e&2s 0itc$en, an% pro#pt!& noti"ie% Ga!!e&, I 'i!! $o!% &ou to our contract. I" a!!o'e% to per"or#, <oiner 'ou!% $a,e #a%e a pro"it o" -=,... on t$e 7o*. I" Ga!!e& re"uses to retract $is repu%iation, an% <oiner sues $i# "or %a#ages, '$at is t$e #a1i#u# t$at <oiner is entit!e% to reco,er3 A. Not$ing, *ecause $e "ai!e% to #itigate $is %a#ages. B. -=,..., $is e1pectanc& %a#ages. C. -+,..., on a restitutionar& t$eor&. 8. -+,..., $is re!iance %a#ages, p!us -=,..., $is e1pectanc& %a#ages. Question 1D) ?reun%, a U.S. 'est9coast #anu"acturer, ga,e Arenc$, a $ar%'are retai!er '$o 'as re!ocating to t$e east coast, t$e "o!!o'ing !etter o" intro%uction to Tu"", an east9coast $ar%'are '$o!esa!er. T$is 'i!! intro%uce &ou to #& goo% "rien% an% "or#er custo#er, Arenc$, '$o 'i!! *e see0ing to arrange t$e purc$ase o" $ar%'are in,entor& "ro# &ou on cre%it. I" &ou 'i!! !et $i# $a,e t$e goo%s, I 'i!! #a0e goo% an& !oss up to -2+,... in t$e e,ent o" $is %e"au!t. LSigne%L ?reun% Arenc$ presente% t$e !etter to Tu"", '$o t$en so!% an% %e!i,ere% -2.,... 'ort$ o" $ar%'are to Arenc$ on cre%it. Tu"" pro#pt!& noti"ie% ?reun% o" t$is sa!e.

A$ic$ o" t$e "o!!o'ing is NOT an accurate state#ent concerning t$e arrange#ent *et'een ?reun% an% Tu""3 A. It 'as i#portant to en"orcea*i!it& o" ?reun%2s pro#ise to Tu"" t$at it *e e#*o%ie% in a signe% 'riting. B. B& e1ten%ing t$e cre%it to Arenc$, Tu"" e""ecti,e!& accepte% ?reun%2s o""er "or a uni!atera! contract. C. A!t$oug$ ?reun% recei,e% no consi%eration "ro# Arenc$, ?reun%2s pro#ise is en"orcea*!e *& Tu"". 8. ?reun%2s pro#ise is en"orcea*!e *& Tu"" '$et$er or not Tu"" ga,e ?reun% seasona*!e notice o" t$e e1tension o" cre%it to Arenc$. Questions D299D= are *ase% on t$e "o!!o'ing "act situation. Question D2 Gour#et, a "a#ous c$e", entere% into a 'ritten agree#ent 'it$ $is "rien% 8e!igor, a 'e!!90no'n interior %ecorator respecte% "or $is uni/ue %esigns, in '$ic$ 8e!igor agree%, "or a "i1e% "ee, to %esign t$e interior o" Gour#et2s ne' restaurant, an%, upon Gour#et2s appro,a! o" t$e %esign p!an, to %ecorate an% "urnis$ t$e restaurant accor%ing!&. T$e agree#ent 'as si!ent as to assign#ent or %e!egation *& eit$er part&. Be"ore *eginning t$e 'or0, 8e!igor so!% $is %ecorating *usiness to Ne'#an un%er an agree#ent in '$ic$ 8e!igor assigne% to Ne'#an, an% Ne'#an agree% to co#p!ete, t$e Gour#et 8e!igor contract. Ne'#an, a!so an e1perience% %ecorator o" e1ce!!ent repute, a%,ise% Gour#et o" t$e assign#ent, an% supp!ie% $i# 'it$ in"or#ation con"ir#ing *ot$ Ne'#an2s "inancia! responsi*i!it& an% past co##ercia! success. Is Gour#et o*!igate% to per#it Ne'#an to per"or# t$e Gour#et98e!igor agree#ent3 A. 6es, *ecause t$e agree#ent containe% no pro$i*ition against assign#ent or %e!egation. B. 6es, *ecause Gour#et recei,e% a%e/uate assurances o" Ne'#an2s a*i!it& to co#p!ete t$e 7o*. C. No, *ecause 8e!igor2s %uties 'ere o" a persona! nature, in,o!,ing $is reputation, taste, an% s0i!!. 8. No, *ecause 8e!igor2s purporte% %e!egation to Ne'#an o" $is o*!igations to Gour#et e""ecte% a no,ation. Question D= I" Gour#et a!!o's Ne'#an to per"or# an% appro,es $is %esign p!an, *ut Ne'#an "ai!s 'it$out !ega! e1cuse to co#p!ete t$e %ecorating as agree%, against '$o# %oes Gour#et $a,e an en"orcea*!e c!ai# "or *reac$ o" contract3 A. 8e!igor on!&, *ecause 8e!igor2s agree#ent 'it$ Ne'#an %i% not %isc$arge $is %ut& to Gour#et, an% Ne'#an #a%e no e1press pro#ise to Gour#et. B. Ne'#an on!&, *ecause 8e!igor2s %ut& to Gour#et 'as %isc$arge% '$en 8e!igor o*taine% a s0i!!e% %ecorator 4Ne'#an5 to per"or# t$e Gour#et 8e!igor contract. C. Ne'#an on!&, *ecause Gour#et 'as an inten%e% *ene"iciar& o" t$e 8e!igor9 Ne'#an agree#ent, an% 8e!igor2s %ut& to Gour#et 'as %isc$arge% '$en Gour#et per#itte% Ne'#an to %o t$e 'or0 an% appro,e% Ne'#an2s %esign. 8. Eit$er 8e!igor, *ecause $is agree#ent 'it$ Ne'#an %i% not %isc$arge $is %ut& to Gour#etG or Ne'#an, *ecause Gour#et 'as an inten%e% *ene"iciar& o" t$e 8e!igor9Ne'#an agree#ent. Question 1D2 In e1c$ange "or a ,a!i% an% su""icient consi%eration, Goo%*ar ora!!& pro#ise% Aa!0er, '$o $a% no car an% 'ante% a #ini,an, to pa& to an&one "ro# '$o# &ou *u& a #ini,an 'it$in t$e ne1t si1

#ont$s t$e "u!! purc$ase9price t$ereo". T'o #ont$s !ater, Aa!0er *oug$t a use% #ini,an on cre%it "ro# Mini,anit& ?air, Inc., "or -(,.... At t$e ti#e, Mini,anit& ?air 'as una'are o" Goo%*ar2s ear!ier pro#ise to Aa!0er, *ut !earne% o" it s$ort!& a"ter t$e sa!e. Can Mini,anit& ?air en"orce Goo%*ar2s pro#ise to Aa!0er3 A. 6es, un%er t$e %octrine o" pro#issor& estoppe!. B. 6es, *ecause Mini,anit& ?air is an inten%e% *ene"iciar& o" t$e Goo%*ar9 Aa!0er contract. C. No% *ecause Goo%*ar2s pro#ise to Aa!0er is unen"orcea*!e un%er t$e suret&s$ip c!ause o" t$e statute o" "rau%s. 8. No, *ecause Mini,anit& ?air 'as neit$er i%enti"ie% '$en Goo%*ar2s pro#ise 'as #a%e nor a'are o" it '$en t$e #ini,an9sa!e 'as #a%e. Question 1D: Bree%er *oug$t a t'o9#ont$9o!% registere% *oar at auction "ro# >igst&!e "or -(... No e1press 'arrant& 'as #a%e. ?i"teen #ont$s !ater, tests *& e1perts pro,e% conc!usi,e!& t$at t$e *oar $a% *een *orn incura*!& steri!e. I" t$is $a% *een 0no'n at t$e ti#e o" t$e sa!e, t$e *oar 'ou!% $a,e *een 'ort$ no #ore t$an -1... In an action *& Bree%er against >igst&!e to a,oi% t$e contract an% reco,er t$e price pai%, t$e parties stipu!ate t$at, as *ot$ 'ere an% $a% *een a'are, t$e #ini#u# age at '$ic$ t$e "erti!it& o" a *oar can *e %eter#ine% is a*out 12 #ont$s. A$ic$ o" t$e "o!!o'ing 'i!! t$e court pro*a*!& %eci%e3 A. Bree%er 'ins, *ecause t$e parties 'ere #utua!!& #ista0en as to t$e *oar2s "erti!it& '$en t$e& #a%e t$e agree#ent. B. Bree%er 'ins, *ecause >igst&!e i#p!ie%!& 'arrante% t$at t$e *oar 'as "it "or *ree%ing. C. >igst&!e 'ins, *ecause Bree%er assu#e% t$e ris0 o" t$e *oar2s steri!it&. 8. >igst&!e 'ins, *ecause an& #ista0e in,o!,e% 'as uni!atera!, not #utua!.