Contracts Practice Exam

A domestic sale of movable office chairs is governed by a state's enacted UCC Article 2. The parties dispute a formation issue that an applicable Article 2 section directly resolves.

A student finds a different general rule in a Restatement illustration. Which authority controls that issue?

1. AThe Restatement, because it is federal contract legislation.
2. BThe applicable enacted Article 2 provision.
3. CWhichever source was published most recently.
4. DNeither source, because only merchant-to-merchant sales fall under Article 2.

A contract sells identified replacement equipment with installation to make it usable. Its language and commercial object concern acquiring that equipment. Applying Bonebrake's predominant-purpose approach, which is strongest?

1. AThe goods-sale purpose can bring the mixed transaction within Article 2 despite installation.
2. BSubstantial labor automatically excludes Article 2.
3. CAny mixed contract must be split mechanically by invoice line.
4. DA federal appellate decision makes the UCC federal legislation.

Lena and Omar discuss a kayak sale at a cookout, agree on the kayak and a $300 price, and sign a note stating those terms. Omar believes the sale is serious, although Lena later says she privately intended a joke. Which statement best analyzes assent, assuming no separate defense?

1. ANo assent exists unless Lena admits she privately intended the sale.
2. BA social setting makes a serious agreement legally impossible.
3. CThe negotiated terms and signatures support Omar's actual and reasonable understanding of agreement.
4. DOmar must pay a deposit before any words or signatures can manifest assent.

A land seller sends a form letter giving a location and price, explains that further assent is needed, and warns that another prospective buyer may decide shortly. The recipient replies that it accepts the listed price. Under Lonergan's reasoning, which is best?

1. AThe stated price alone made an offer.
2. BEvery form letter creates an acceptance power.
3. CThe seller's uncommunicated wishes control.
4. DThe reservation of further assent supports preliminary negotiation rather than an offer.

A store advertises two identified jackets for $10 each, available Saturday at 9 a.m., first come, first served. A customer arrives first and tenders the price. Considering offer and acceptance only, with mistake and other defenses reserved, which analysis follows Lefkowitz?

1. AAdvertisements can never create an acceptance power.
2. BThe specific goods, price and first-arrival condition support an offer accepted as invited.
3. CAny printing error automatically prevents an offer, even if the customer has no reason to recognize it.
4. DThe customer had to accept before the advertised time.

A seller makes a revocable land-sale offer with an unpaid decision deadline. Before the buyer accepts, a reliable witness tells the buyer that the seller has completed an inconsistent sale. Under Dickinson's reasoning, what follows if the buyer nevertheless attempts acceptance within the original deadline?

1. AThe deadline alone makes the offer irrevocable.
2. BKnowledge of the inconsistent sale before acceptance defeats the attempted acceptance on these facts.
3. COnly a personal message from the seller can matter.
4. DThe buyer automatically acquires the land by replying within the deadline.

A land seller promises a thirty-day hold-open period. The buyer supplies no consideration, and the writing recites none. Assume no statute, reliance or other basis for irrevocability.

On day ten the seller communicates withdrawal before the buyer attempts acceptance. Under the distinction between a supported option and a gratuitous deadline, which is best?

1. AWithdrawal was effective before acceptance because no stated basis makes the offer irrevocable.
2. BEvery land-sale offer is irrevocable.
3. CAny decision deadline creates a paid option.
4. DAbsence of a buyer signature alone resolves all formation issues.

A merchant wholesaler signs its own letter offering 500 hammers at $8 each and assuring a six-month hold-open period. No consideration or other irrevocability basis is supplied.

It attempts withdrawal after two months, and the retailer immediately accepts. Under model UCC 2-205, which is best?

1. AThe assurance has no effect without consideration.
2. BSection 2-205 alone protects the entire six months.
3. CEvery firm offer requires acceptance within ten days.
4. DThe attempted withdrawal during the first three months is ineffective under this section.

A buyer orders 80 blue mugs for prompt shipment. Under UCC § 2-206, the seller promptly sends 80 green mugs and seasonably states that this shipment is offered only as an accommodation. If the buyer rejects it, did the shipment itself accept the order?

1. AYes. Every shipment accepts an order, even with an accommodation notice.
2. BYes. The color difference is irrelevant to formation.
3. CNo. Every shipment of nonconforming goods is a rejection rather than an acceptance.
4. DNo. The seasonable accommodation notice prevents this nonconforming shipment from accepting the offer.

An outstanding offer expressly invites acceptance by mail without requiring receipt. The offeree mails the acceptance on May 3 with sufficient postage and the offeror's correct address; it is lost in transit. Assuming the dispatch approach described in Cantu and no separate defense, when does assent become effective?

1. AOnly if the offeror eventually reads the letter.
2. BNever, because all mailed acceptances require receipt.
3. COn dispatch on May 3.
4. DOnly if certified mail was used.

An option expressly requires written exercise to be received by Friday. Assume the governing law enforces that clear requirement and no excuse applies.

The holder mails the notice Thursday; it arrives Monday. Which conclusion best respects the option's stated terms?

1. AMailing always overrides an express receipt deadline.
2. BCertified mail would automatically make Monday receipt timely.
3. CThe exercise is late because receipt occurred after the agreed deadline.
4. DThe offeror's private hope, rather than the agreed condition, supplies the deadline.

An offer expressly invites acceptance only by completing a twenty-mile walk by Sunday. The offeree begins the invited walk Saturday and reaches mile five before receiving attempted revocation.

Apply the section 45 approach discussed in Drennan. Which statement is best?

1. ABeginning the invited performance protects an opportunity to finish, while payment remains conditional on completion.
2. BEvery offer remains revocable despite beginning its invited performance.
3. CStarting the walk immediately earns the entire reward, even if the walker stops.
4. DFive miles necessarily earns one-quarter of the reward under the offer.

A retailer orders 40 desks for prompt shipment. No words or circumstances restrict how the seller may accept. The seller promptly informs the retailer that it is committing to ship all forty desks the following day. Under UCC § 2-206, must the seller ship before a contract can form?

1. ANo. A prompt promise to ship can accept this offer, creating reciprocal obligations before shipment.
2. BYes. An order for goods always invites acceptance only by completed delivery.
3. CYes. An unperformed promise cannot be an acceptance.
4. DNo, but only because the retailer has already paid.

A consultant sends a business an unsolicited offer stating that no reply within ten days will mean acceptance. The business has no prior dealings with the consultant, takes no services and does nothing indicating agreement. Does the consultant's announcement alone bind it?

1. AYes, because any offeror can impose a duty to reject.
2. BYes, because every unanswered message proves assent.
3. CNo, because consulting agreements always need two signatures.
4. DNo. The stated inaction supplies no basis for treating silence as acceptance.

In a land sale governed by the common-law approach in Normile v. Miller, the seller returns the buyer's offer with a required larger down payment and a shorter repayment period. The buyer has not agreed to those changes.

What is the seller's response?

1. AAn acceptance on the original terms because the seller signed the form.
2. BAn acceptance that makes the buyer's silence assent to the new payment terms.
3. CA counteroffer rather than an acceptance of the buyer's original terms.
4. DA firm offer under UCC Article 2.

Merchants agree orally on a sale with warranty protection, but a later package disclaims it. The buyer never assents to the disclaimer and both parties perform; assume the disclaimer materially alters their agreement. Under Step-Saver's 2-207 analysis, which statement is best?

1. AThe last form automatically supplies the disclaimer.
2. BThe material disclaimer does not enter merely through delivery and use.
3. CAll added terms enter every merchant sale.
4. DThere is no contract because no final writing matches.

A merchant seller clearly refuses acceptance unless the buyer assents to a warranty disclaimer. The buyer never assents, orally, in writing or otherwise, but the seller nevertheless ships and the buyer receives and pays for the goods. Assuming the communications did not form a contract, what supplies its terms?

1. AEvery seller term, because delivery was accepted.
2. BAgreed written terms and UCC supplements under 2-207(3).
3. CEvery buyer term, solely because its order came first.
4. DNo contract can exist after a conditional response.

An aunt signs a note reciting value received. The parties agree she intended a gift and requested no act or promise in exchange. Which is the best consideration analysis?

1. AThe recital conclusively establishes consideration.
2. BThe promised amount is too small to be consideration.
3. CThe gift becomes a bargain whenever the recipient wants it.
4. DThe admitted gift facts rebut an exchange despite the recital.

A grandmother promises a graduation gift. The parties agree she requested no attendance, forbearance or other act in exchange; graduation is only the occasion for receiving the gift.

No reliance theory is asserted. What follows under the bargain requirement?

1. AThe condition alone does not supply a requested exchange.
2. BEvery family promise is unenforceable.
3. CA gift recital conclusively proves consideration.
4. DAny effort by the recipient necessarily supplies consideration.

Without a prior request or agreement, Tomas voluntarily plows Nia's driveway. After the work is complete, she promises $500 in gratitude. Considering bargained-for consideration only, with statutory, material-benefit and restitution theories reserved, which is best?

1. AAn oral promise automatically supplies consideration.
2. BAny completed benefit necessarily supports every later promise.
3. CThe earlier unrequested act was not exchanged for the later promise.
4. DNeighbors can never bargain for payment.

A roofer agrees to replace a roof for $12,000 but halfway through, with no unexpected problem, threatens to stop unless paid $15,000. The homeowner, who cannot find another roofer, agrees but pays only $12,000 after completion. At common law, is she liable for the extra $3,000?

1. AYes, because she agreed voluntarily.
2. BYes, because a promise to pay more for the same work is always enforceable.
3. CNo, because the roofer was already bound to do the work, and the new promise was not supported by consideration.
4. DNo, because oral modifications are always void.

A goods supplier and bakery agree to a price increase during a genuine shortage. Assume actual assent, good faith, signatures satisfying every applicable formality and no remaining defense. Under UCC 2-209(1), is new consideration additionally necessary?

1. ANo. A goods-contract modification needs no consideration under subsection (1).
2. BYes. An extra performance is always required.
3. CYes. All price modifications are forbidden.
4. DNo, because a cost increase alone automatically changes the price without agreement.

A homeowner owes a painter a fee, but they dispute the amount in good faith. The homeowner in good faith tenders a $500 check with a conspicuous full-satisfaction statement covering that disputed fee. The painter obtains payment.

Assume the claim is subject to a bona fide dispute, UCC 3-311 applies, and no subsection (c) or other exception preserves it. Which is best?

1. AThe fee claim can be discharged only if the painter separately signs a settlement.
2. BAn instrument can never settle a disputed amount.
3. CObtaining payment is irrelevant under this section.
4. DThe stated tender and payment satisfy the section's discharge conditions.

A board promises a longtime employee a pension whenever she chooses to retire, seeking neither further work nor retirement in exchange. She retires earlier than planned because of the promise, which the employer later repudiates. Assuming foreseeable reasonable reliance and injustice, her strongest stated theory is:

1. AA bargain requiring her retirement in exchange.
2. BPromissory estoppel based on the induced retirement.
3. CAutomatic restitution for all past salary.
4. DThe statute of frauds as an affirmative right to payment.

A bystander summons physicians to an unconscious accident victim. They perform necessary emergency surgery with due skill and care, but the patient dies without regaining consciousness.

Under Cotnam v. Wisdom, which analysis best describes their claim for reasonable compensation?

1. AAn obligation implied in law can support reasonable compensation despite the absence of actual assent and the unsuccessful outcome.
2. BThe patient's unconscious silence was an express promise to pay.
3. CThe physicians can recover only if they prove the operation saved the patient's life.
4. DThe value of the patient's estate automatically sets the fee.

A stranger voluntarily cares for an independent adult during an illness. The adult's parent neither requested the care nor owed a legal duty to pay for it.

After all services are complete, the grateful parent promises reimbursement, then refuses. Applying the reasoning of Mills v. Wyman, is gratitude alone sufficient consideration for that promise?

1. AYes, because every written promise is enforceable without consideration.
2. BNo. The past, unrequested care of the adult child supplies no bargained-for consideration from the parent.
3. CYes, because parents are automatically liable for every adult child's expenses.
4. DNo, because a promise made after any past event can never be enforced under any doctrine.

A caterer makes an oral agreement expressly requiring two full years of service from formation. Assume no qualifying writing, alternative performance within a year, or applicable exception. Under the one-year category in 12 V.S.A. 181(4), which statement is best?

1. AServices cannot fall within a writing requirement.
2. BThe agreement fits the category for a promise not performable within one year.
3. CEvery agreement lasting longer than a month needs a writing.
4. DEight months of service automatically completes the promised two-year performance.

After a disputed phone agreement for goods, a merchant promptly sends a signed confirmation sufficient against itself and stating quantity. The other merchant receives it, has reason to know its contents, and sends no written objection within ten days. What does UCC 2-201(2) establish?

1. AEvery term in the confirmation becomes an agreed term.
2. BSilence conclusively proves the disputed oral agreement.
3. CBoth parties must still sign to satisfy the statute.
4. DThe confirmation can satisfy the writing requirement against the recipient, while formation remains to be proved.

Two businesses intentionally sign a supply agreement electronically in interstate commerce. Assume the agreement is within E-SIGN's coverage and satisfies all other formation requirements.

One business argues that it is unenforceable solely because neither signature was put on paper. What does 15 U.S.C. § 7001 provide?

1. AElectronic signatures validate every agreement, even one lacking assent.
2. BElectronic signatures are effective only if both businesses are banks.
3. CElectronic form alone cannot justify denying this agreement legal effect.
4. DE-SIGN requires every business to accept electronic records in every future transaction.

Apply California Family Code 6710 as reproduced in the cited 2025 text. A person still under majority seeks to disaffirm a contract made during minority.

Assume no statutory exception. Which statement follows from this section alone?

1. AUse of the purchased item is an express exception stated in 6710.
2. BThe minor may disaffirm before majority; restitution consequences require separate analysis.
3. COnly an emancipated adult may invoke the minor's disaffirmance rule.
4. DThe section conclusively fixes every use and depreciation offset.

A contractor threatens in bad faith to abandon an existing building obligation unless the owner accepts a higher price. Assume the threat is improper under the governing sections 175-176 approach, induces the owner's assent, and leaves no reasonable alternative. Which defense follows?

1. AParol evidence, solely because the demand was spoken.
2. BAutomatic impossibility, because the contractor prefers more pay.
3. CA universal rule invalidating every price increase.
4. DDuress makes the induced agreement voidable under the stated approach.

An exhausted person alleges that several negotiators demanded an immediate signature late at night, emphasized disastrous consequences of waiting, and refused time for independent advice. Applying Odorizzi's analysis, which response best addresses an undue-influence claim?

1. ALack of a confidential relationship necessarily defeats the claim.
2. BVulnerability combined with excessive persuasion can support the claim; the alleged facts still must be proved.
3. CAny regretted bargain establishes undue influence.
4. DOnly an explicitly false factual statement can establish undue influence.

Under the innocent-material-misrepresentation analysis in Barrer, a buyer receives a materially false statement, justifiably relies on it in agreeing and suffers the additional detriment required by District of Columbia law. The speaker lacked fraudulent intent. Does that absence of intent necessarily defeat rescission?

1. ANo. Innocent material misrepresentation can support avoidance when its required elements are established.
2. BYes. Rescission always requires proof of an intentional lie.
3. CYes. Materiality eliminates the need to examine reliance, so rescission is unavailable.
4. DNo. Every innocent inaccuracy automatically voids every contract.

Under the residential-sale disclosure rule adopted in Hill v. Jones, a seller knows of concealed termite damage that materially affects a house's value. The buyer does not know, and the damage is not readily observable.

Does the buyer's failure to ask a specific termite question necessarily eliminate a disclosure duty?

1. AYes. Silence can never have legal consequences.
2. BYes. A duty exists only if the buyer uses the exact name of the defect.
3. CNo. Every seller must volunteer every fact, however immaterial.
4. DNo. The stated knowledge, materiality and lack of observability can require disclosure without that specific question.

A goods seller supplies a contract only after delivery, calls it a routine confirmation and prevents meaningful review. A hidden term gives its insurer exclusive control of arbitration rules and selection of arbitrators. Under a test requiring both procedural and substantive unconscionability, which analysis is strongest?

1. AArbitration is always unconscionable regardless of its procedures.
2. BThe failure to read automatically voids every term of the transaction.
3. CThe presentation supports a procedural objection, and exclusive control supplies a separate substantive objection.
4. DThe court cannot allow evidence about the commercial setting.

Assume California Civil Code § 1667 applies as reproduced in the cited 2025 Code. Two parties agree to an act that directly violates an express statute. One argues that the object becomes lawful because both signed and no contract term uses the word 'illegal.' Which answer addresses lawfulness under § 1667(1)?

1. AThe object is lawful because both parties consented.
2. BThe object is unlawful because it is contrary to an express provision of law.
3. CThe object is lawful unless the contract labels it illegal.
4. DThe section automatically determines every restitution and severability question as well.

A Massachusetts patient proves a surgeon made a specific promise of a result and breached it. The jury rejects negligence.

The surgeon argues that public policy categorically bars every action on a physician's promise. Which answer follows Sullivan v. O'Connor?

1. AThe argument succeeds because all physician-patient promises are legally void.
2. BThe negligence verdict necessarily defeats the separately proved contract claim.
3. CThe court permits the contract claim on clear proof rather than adopting a categorical public-policy bar.
4. DEvery encouraging medical remark necessarily creates an enforceable guarantee.

A buyer and seller both believe an apartment building can lawfully house tenants. A preexisting sanitation defect defeats that use, but the contract expressly allocates unknown physical-defect risk to the buyer. Under the Lenawee analysis, which answer is strongest?

1. AThe buyer’s assumption of the relevant risk can defeat rescission even though the shared mistake is fundamental.
2. BThe clause allocates the risk to the seller because the seller drafted it.
3. CThe shared mistake necessarily requires rescission despite the risk clause.
4. DThe problem is necessarily a post-contract event merely because discovery came later.

A subcontractor supplies a definite bid expecting a general contractor to use it in the main bid. The contractor reasonably does so and has no reason to recognize a computation error. After award the subcontractor tries to withdraw, and the contractor promptly seeks the subcontract as bid without shopping for a lower price.

Which analysis best follows Drennan?

1. AThe issue is necessarily frustration from a later event.
2. BBoth parties necessarily made the same calculation error.
3. CJustified reliance can protect a reasonable opportunity to accept; the bidding error does not automatically defeat that protection.
4. DEvery subcontract bid becomes irrevocable even without reliance.

A contract names the vessel Peerless without a sailing date. The buyer pleads that it meant the October vessel, while the seller offered cotton carried by a different Peerless sailing in December.

The seller challenges whether that pleading can be a defense. Which outcome matches the reported decision in Raffles v. Wichelhaus?

1. AThe seller wins because any vessel with the same name necessarily satisfies the bargain.
2. BThe buyer wins because every private misunderstanding defeats objective assent.
3. CThe court awards the buyer consequential damages for the late cotton.
4. DThe plea supplies a sufficient defense, and judgment is entered for the buyers.

A goods contract has no express term resolving delivery hour. Applicable course-of-performance evidence conflicts with prior course of dealing, and reasonable consistency is impossible.

No waiver or modification issue is presented. Under UCC 1-303(e), which source prevails between those two?

1. ACourse of performance prevails over course of dealing.
2. BTrade usage necessarily defeats both.
3. CA disputed phrase has no possible interpretation.
4. DPrior dealing always prevails over present performance.

A judge following Pacific Gas & Electric v. G.W. Thomas Drayage thinks a clause is clear on its face. A party offers credible surrounding-circumstances evidence to show a different meaning to which the words are reasonably susceptible.

May the judge reject that evidence solely because the judge's first reading seems clear?

1. AYes. The judge's initial linguistic impression conclusively fixes meaning.
2. BYes. Extrinsic evidence is never relevant to a written agreement.
3. CNo. The court must preliminarily consider credible interpretive evidence before deciding reasonable susceptibility.
4. DNo. Any proposed outside meaning must then be accepted, however inconsistent with the words.

A court finds a truck-sale writing intended as a complete and exclusive agreement. The buyer offers an earlier oral promise of extra tires only as a consistent additional term, with no separate interpretation, validity or usage claim. Under UCC 2-202(b), is that evidence admitted?

1. AYes, because every consistent term must be admitted.
2. BNo, because the complete and exclusive writing excludes that additional term.
3. CYes, because oral promises always override writings.
4. DNo, because tires cannot be part of a truck transaction.

A deed reserves an option and is silent about assignment. Grantees offer an alleged collateral agreement that the option was personal. Under the Masterson majority's reasoning, which conclusion is best?

1. ASilence conclusively proves that no other term exists.
2. BAdmission establishes the oral restriction as true.
3. COrdinary assignability is necessarily an express written promise.
4. DConsider intended integration and whether the collateral term might naturally be separate.

A court finds a written goods contract to be a complete and exclusive statement of the parties' agreement. The buyer offers evidence of an earlier oral promise to include free installation as an additional term, not as an interpretation based on trade usage or the parties' conduct. Under UCC § 2-202(b), may the buyer add the promise merely because it does not contradict the writing?

1. AYes. Every consistent oral term must be admitted, even after a finding of complete integration.
2. BNo. The complete-and-exclusive finding excludes consistent additional terms of this kind.
3. CNo. Section 2-202 bars all evidence, including every form of course of performance.
4. DYes. A buyer's oral statement always overrides a signed writing.

One contract calls for twelve monthly deliveries of flour but leaves delivery-hour terminology unclear. For six months the seller arrives at 5 p.m. The buyer knows the timing, has an opportunity to object, and accepts without objection.

Under UCC § 1-303, how should those six deliveries be classified?

1. ACourse of dealing, because any repeated conduct has that name.
2. BCourse of performance under this particular contract.
3. CUsage of trade, even without evidence of a trade-wide practice.
4. DIrrelevant conduct, because only negotiations can explain contract language.

During four earlier purchases, a wholesaler and shop consistently used 'case' to mean 24 bottles. A new order uses 'case' without defining it, and no delivery has yet occurred under that order. Which UCC § 1-303 category most directly covers the earlier purchases?

1. ACourse of performance, because this new order has already been performed four times.
2. BUsage of trade, established conclusively by any two parties' private habit.
3. CCourse of dealing that may supply a common basis for interpreting the new order.
4. DA modification of the new order made after formation.

A supplier offers evidence of a packaging practice regularly observed in the buyer's trade. The buyer should be aware of the practice, and it can reasonably be read consistently with the written contract. The supplier gives litigation notice sufficient to prevent unfair surprise.

Under UCC § 1-303, does the absence of a prior transaction between these parties alone bar the evidence?

1. AYes. Trade usage requires at least three earlier contracts between the same parties.
2. BYes. A writing automatically excludes all evidence of trade practices.
3. CNo. Every asserted practice is binding without proof of its existence or scope.
4. DNo. Trade usage may explain or supplement terms even without prior dealings between these parties.

A sales agreement governed by the UCC contains no paragraph labeled 'good faith.' During a dispute about performance, the seller argues that no good-faith obligation applies because the parties did not write one. Which answer best addresses that argument?

1. AUCC § 1-304 imposes good faith in performance and enforcement without requiring a separately written promise.
2. BGood faith applies only if the buyer paid separately for it.
3. CThe absence of a clause gives either party a statutory right to act dishonestly.
4. DSection 1-304 automatically makes every disputed performance a breach.

A letter states that no sublease will exist unless written landlord consent is delivered by June 1. Only oral notice arrives by that date; no waiver, estoppel or forfeiture ground is established. Under Oppenheimer, which statement is correct?

1. AOral notice necessarily satisfies the condition because it communicates the same information.
2. BEvery condition is only a promise, so damages replace compliance.
3. CSubstantial performance alone does not replace the required timely written delivery.
4. DA missed deadline automatically proves that the recipient waived it.

Under the majority's approach in Jacob & Youngs v. Kent, a builder's unintentional deviation is trivial in relation to a completed project. Replacement would require extensive demolition.

Assume the court finds substantial performance and the parties did not expressly make literal compliance with this term a condition of payment. What is the best analysis?

1. AEvery deviation necessarily defeats the entire payment obligation.
2. BSubstantial performance means no breach occurred and no damages are possible.
3. CThe builder may deliberately disregard any specification it considers unimportant.
4. DThe constructive condition may be satisfied by substantial performance, with an appropriate allowance for the defect.

A buyer waives a goods contract's remaining delivery deadline. The seller materially changes position in reliance on that waiver. The buyer later sends a demand for strict compliance.

Assume retracting the waiver would be unjust because of that reliance. Under UCC § 2-209(5), is notification alone enough to restore the original deadline?

1. AYes. Every waiver can be retracted regardless of reliance.
2. BYes. A waiver is ineffective unless supported by new consideration.
3. CNo. Retraction is unavailable on the stated facts because it would be unjust in view of the material reliance.
4. DNo. No waiver of an unperformed term can ever be retracted.

A builder is owed a final $20,000. Applying Jacob & Youngs, the court finds substantial performance, an innocent trivial brand deviation and no express condition requiring literal compliance. It also finds that $15,000 replacement work would be grossly disproportionate to the benefit and that the defect reduces value by $500.

With no other loss or offset, what remains payable?

1. A$5,000, because a stated $15,000 replacement expense must always be deducted.
2. BNothing, because every deviation forfeits the balance.
3. C$19,500 after the $500 damages allowance.
4. DThe full $20,000 because substantial performance eliminates every damages claim.

A noninstallment goods tender fails to conform. Assume no contrary agreed remedy limits and no acceptance yet. Under 2-601, subject to the seller's applicable cure rights, which is best?

1. AThe buyer can reject the whole, accept the whole, or accept commercial units and reject the rest.
2. BThe buyer must accept everything whenever most units conform.
3. CThe buyer can keep all goods without any payment or damages accounting.
4. DCommon-law materiality always replaces the statutory rejection rule.

Assume an uncured breach is material under Restatement 241, but the circumstances leave a timely cure opportunity under 242. Which legal conclusion follows under the Restatement approach discussed in Frazier?

1. ATreat cure as eliminating every damages claim for delay.
2. BDeclare every remaining duty permanently discharged immediately.
3. CSeparate suspension from final discharge and examine the remaining cure opportunity.
4. DApply Article 2 solely because the word material appears.

A court applying the divisible-contract doctrine discussed in Filet Menu finds that a contract pairs each completed design project with its own agreed fee. A designer completes one pair and then materially breaches an unperformed pair. Which statement best captures the consequence of divisibility?

1. AThe designer can claim the agreed compensation for the completed pair, subject to applicable damages or offsets; divisibility does not erase the later breach.
2. BThe later breach automatically forfeits every payment for completed pairs.
3. CEach pair must be treated as a wholly separate contract for every purpose.
4. DDivisibility gives the designer a right to payment for the unperformed pair too.

Before its next delivery is due, a repudiating goods seller clearly communicates that it intends to perform, including every justifiably demanded assurance. The buyer has not canceled, materially changed position or indicated final treatment. Under 2-611, which is best?

1. ARepudiation makes retraction permanently impossible.
2. BRetraction automatically erases all resulting buyer delay.
3. CRetraction remains possible indefinitely after delivery is due.
4. DRetraction can reinstate rights, with due excuse and allowance for delay caused to the buyer.

A goods seller has reasonable grounds for insecurity about a buyer's next payment. The seller has not received the agreed return for the delivery it proposes to suspend. Under UCC 2-609, which response is supported while adequate assurance is sought?

1. ACancel immediately merely because grounds for insecurity exist.
2. BMake a justified written demand and suspend the identified performance only if commercially reasonable.
3. CSuspend every unrelated duty even if its agreed return has already been received.
4. DTreat thirty days as a mandatory minimum period before any response can matter.

A promoter contracts for the use of one identified theater on four dates. An accidental fire destroys it before the first date, without either party's fault. Neither party promised a substitute or assumed the destruction risk.

Applying Taylor v. Caldwell's implied-condition analysis, what is the best result?

1. AThe owner must pay expectation damages because every promise is unconditional.
2. BThe promoter must pay all four fees because the owner was not negligent.
3. CThe destruction excuses the dependent performances because this identified theater's continued existence was a condition of the bargain.
4. DThe result would be identical if the owner had expressly guaranteed a substitute theater.

A farmer agrees to sell 1,000 bushels of corn at $5 per bushel. A regional drought raises the market price to $8, but the farmer’s contracted crop remains intact and delivery requires no added effort or expense. He refuses because selling elsewhere would be more profitable; which answer best applies UCC 2-615?

1. AThe drought automatically excuses delivery.
2. BNo excuse is shown: the event has not made this farmer’s agreed performance impracticable.
3. CThe buyer must pay the new market price.
4. DSeasonable notice alone creates an excuse.

Parties reserve a particular balcony solely to view a named procession on specified dates, discussing its distinctive view. The procession is later canceled, although access remains possible. Under Krell's reasoning, which is the best analysis?

1. APhysical access being possible ends every excuse argument.
2. BEvery disappointed private motive excuses payment.
3. CThe decision necessarily requires refund of every deposit.
4. DExamine the procession as the bargain's foundation and separately determine allocation of cancellation risk.

A buyer agrees to pay $80,000 for a machine. After the seller fails to deliver, the buyer makes a reasonable, prompt and good-faith substitute purchase for $95,000, plus $1,000 of additional commercially reasonable shipping expense. Assuming no saved expenses, other losses or contractual remedy limits, the buyer’s recovery under UCC 2-712 is:

1. A$16,000.
2. B$15,000.
3. C$96,000.
4. D$1,000.

Under the damages analysis discussed in Sullivan v. O'Connor, which proposed measure best describes the reliance interest, as distinct from restitution and expectation? Assume the identified losses are compensable in the particular case and no duplication is allowed.

1. ARestore the claimant's preagreement position by compensating detriments suffered in reliance on the agreement.
2. BReturn only the benefit the defendant received, regardless of other reliance detriment.
3. CGive the claimant the full value of the promised result regardless of the preagreement position.
4. DAward every requested loss merely because the defendant breached.

A buyer pays a $2,000 deposit on goods priced at $10,000, then breaches. The seller justifiably withholds delivery.

Assume UCC § 2-718 applies, there is no liquidated-damages term, and the seller establishes no damages or benefits to offset under subsection (3). How much of the deposit is the buyer entitled to recover under subsection (2)?

1. A$1,500, because the statutory retention is the smaller of $2,000 and $500.
2. B$0, because a breaching buyer never receives restitution.
3. C$2,000, because the statutory retention is always zero when no clause was written.
4. D$500, because the statute limits the buyer's refund, rather than the retention, to $500.

At contracting, a carrier is told that a mill is stopped and a broken shaft is urgently needed. Delay follows and the miller claims all shutdown profit. Under Hadley's reported facts and reasoning, which statement is best?

1. AThe report establishes the carrier received no notice of any stoppage.
2. BThe word urgent automatically proves every claimed profit.
3. CExamine whether the particular loss ordinarily followed or was made probable by the circumstances communicated, with amount and causation still requiring proof.
4. DEvery actual consequence of a delay is recoverable.

An entertainer proves breach of a surgeon's promise and a worsened appearance but provides no evidence that the change caused lost employment or earnings. Using Sullivan v. O'Connor's treatment of the lost-earnings item, what should the jury do with a request for lost earnings?

1. AInfer any amount the entertainer requests from the occupation alone.
2. BExclude the unsupported lost-earnings item without treating the absence of that proof as a bar to all other supported damages.
3. CDeny every item of contract damages because one item lacks proof.
4. DReplace lost earnings with punitive damages automatically.

After canceling a California musical role with director and screenplay approval rights, a studio offers the performer equal pay for a dramatic role abroad with fewer approval rights. Under Parker's majority analysis, which is best?

1. AEqual pay alone establishes an adequate substitute.
2. BRejecting any offered job forfeits every damages claim.
3. CDifferences in the work and contractual rights can defeat the studio's mitigation offset despite equal pay.
4. DThe decision proves an employee never needs to seek other suitable work.

A goods-sale agreement fixes a very large payment for any breach, from a trivial delay to total nondelivery. Under model UCC 2-718(1), what is the best analysis?

1. AEvaluate anticipated or actual harm, proof difficulty and adequacy of other remedies; an unreasonably large amount is a penalty.
2. BEnforce it solely because the label says liquidated damages.
3. CIgnore actual harm under every interpretation of the statute.
4. DInvalidate every stipulated damages amount.

A goods contract requires the buyer to pay $90,000 for any delay, including one day. For the one-day delay at issue, anticipated and actual harm are each about $200; proof and an adequate ordinary remedy present no difficulty. The court finds the stipulated amount unreasonably large under UCC § 2-718(1). What follows?

1. AThe court must enforce $90,000 because the buyer signed.
2. BThe seller must refund the entire contract price even if the goods were delivered properly.
3. CEvery liquidated-damages clause in a goods contract is void.
4. DThe $90,000 term is void as a penalty; any recovery must rest on another available basis.

A goods buyer seeks specific performance during a shortage. The goods are commercially manufactured rather than one of a kind. What does UCC 2-716(1) require the court to consider?

1. AManufactured goods are categorically excluded.
2. BAny breach automatically requires delivery by decree.
3. CThe buyer can always take the goods without paying.
4. DUniqueness or other proper circumstances, rather than uniqueness alone.

A debtor advances value to another in return for a promise to pay the debtor's identified creditor. The creditor did not personally supply that value. Under the Lawrence majority, which is best?

1. AOnly the debtor can ever enforce the promise.
2. BThe creditor can have an enforcement right despite the consideration coming from the debtor.
3. CEvery person benefiting indirectly acquires the same right.
4. DLack of consideration from the creditor alone makes the underlying promise a gift.

For a covered commercial account, a debtor receives effective authenticated notice identifying the assignment and directing full payment to the assignee. No statutory exception or unmet proof request applies. If the debtor pays the assignor anyway, what follows under 9-406(a)?

1. APayment to the original creditor always discharges the account.
2. BThe obligation remains unpaid as against the assignee, despite the money sent to the assignor.
3. CAssignment always destroys the debtor's transaction defenses.
4. DNo notification can affect whom the debtor pays.

Apply UCC 2-210(1). A goods buyer has a substantial interest in the named seller itself performing the agreed precision work, and no term authorizes replacement.

The seller delegates that work to another factory. Which is best?

1. AEvery contractual duty is freely delegable.
2. BNo seller may ever use another factory for any work.
3. CNotice to the buyer alone defeats the substantial-interest limit.
4. DThe buyer's stated substantial interest can prevent delegation of this performance.

Ana validly owes Bo $1,000, and Cy validly owes Ana $1,000. All three make a supported, valid agreement substituting Cy's obligation to Bo for both existing debts, expressly releasing Ana from Bo's claim.

Cy later defaults. Under the novation distinction discussed in Imperial Hotels, can Bo recover the released debt from Ana merely because Cy failed to pay?

1. ANo. A valid substitution extinguished Ana's old obligation.
2. BYes. Every delegation and novation leaves the original debtor liable.
3. CYes. Acceptance of Cy's first payment was the only possible evidence of release.
4. DNo, because Cy's undertaking necessarily lacks consideration.