Sample Midterm Exam Questions

Sample Midterm Exam Questions

Law 3800

Fall 07

Questions 1 and 2 are based upon the following facts:

The Baseball Marketing Company (BMC) markets, distributes and sells basketball apparel and related products. BMC signed a long-term endorsement contract with a 16 year old Serbian player, Darko Milicic, who was virtually unknown in the U.S. Two years later, Milicic became second pick in the NBA draft, making him an immensely marketable young man.

Four days after his 18th birthday, Milicic made a buy out offer to BMC, seeking release from his contract so that he could arrange a more lucrative one elsewhere. BMC refused to release him. Milicic notified BMC in writing that he was disaffirming the contract, and returned all money and goods he had received from the company. BMC again refused to release Milicic.

Believing that Milicic was negotiating an endorsement deal with either Reebok or Adidas, BMC sent both companies a letter that it had an enforceable endorsement deal with Milicic that was valid for several more years. Because of BMC’s letter, Adidas ceased negotiating with Milicic just short of signing a contract. Milicic sued BMC seeking a preliminary injunction that would prohibit BMC sending such letters to competitors. Milicic v Basketball Marketing company, Inc.

1.  Which of the following statements best describes the likelihood of Milicic being granted the injunction?

a.  Milicic has a strong likelihood of success in obtaining his injunction; he has exercised his power to avoid the contract within a reasonable time after he has reached the age of majority (age 18).

b.  Milicic cannot now claim to disavow the contract; he has reached the age of majority (age 18).

c.  Milicic will not be granted an injunction because it is an equity remedy, and this is a contracts case.

d.  None of the above.

2.  The court will consider four factors in deciding whether or not to grant Milicic’s request for an injunction. They are:

1. The injunction would restore the parties to status quo which existed before the wrongful conduct. Injunctive relief is necessary to prevent immediate and irreparable harm. Greater injury would have occurred from denying the injunction that granting it. Milicic’s case is weak, and without the injunction, he will likely not win the case on its merits.
2. Milcic has a strong likelihood of success on the merits of his case. Injunctive relief is necessary in order to prevent immediate and irreparable harm. Greater injury will occur from denying the injunction than from granting it. The preliminary injunction will restore the parties to the status quo that existed before the wrongful conduct.
3. Milicic’s status as a minor. Milicic’s status as a Serbian citizen. The amount in controversy. Milicic’s return of all consideration.
4. None of the above.

A written contract for the sale of goods over $5,000 in value contains the following clause: “This written document is intended to be the final and exclusive terms and conditions of the agreement between the parties, and the parties agree that any prior or contemporaneous oral agreements or negotiations not reduced to writing and incorporated herein are of no force and effect, and not binding upon either party.”

3. This clause is:

a. Called a “consolidation clause”.

b. Called a “merger clause”.

c. Intended to enforce the Parol Evidence Rule.

d. a and c above.

e. b and c above.

John makes an offer to sell to Bob, John’s very rare 1967 Advanti sports car. John says he will sell it to Bob for $24,800. Bob agrees, and they reduce their contract to a written document. The contract meets the requirements of the UCC and is enforceable. In accordance with the terms of the contract, Bob presents John with a cashier’s check for the $24,800, and asks John to give him the car. John refuses, saying he has changed his mind, and is going to keep the car.

4. Bob sues John for breach of the contract. He wants the Advanti. Which of the follow legal doctrines should his attorney base his lawsuit upon?

a. Prommisory Estoppel.

b.Quasi Contract

c. Detrimental Reliance

d. Unjust Enrichment

e. None of the Above..

5. Which of the following equity remedies should Bob’s attorney ask the court to order?

a. Specific Performance.

b. Quasi Contract.

c. Claim and Delivery.

d. Substituted Performance.

e. None of the Above.

William and Terrelle negotiate a contract for the sale of a used industrial forklift for

$499. They reduce their contract to writing. Their written Contract cdoes not contain a “Merger Clause”. One of the terms in their contract specifies

that the forklift is to be delivered to Terrelle’s place of business on December 1st

Subsequent to the signing of the contract, William who is the seller, discovers that he

won’t be able to deliver the forklift until December 15th, due to a parts shortage. William

calls Terrelle on the telephone and asks Terrelle for oral extension of the time for

delivery. Terrelle gives his oral approval. No Written modification is prepared or signed.

When William misses the December 1st date for delivery contained in the written

contract, Terrelle starts a lawsuit against William for breach of the contract.

6. a. Terrelle will win because of the requirements of the Parol Evidence Rule.

b. Terrelle will win because William cannot contradict the written contract in this case by using evidence of the oral agreement to modify the contract.

c. The Statute of Frauds applies to this contract, and thus an oral modification is unenforceable.

d. Both a and b Above.

e. None of the Above.

Jack and Jill enter into a sales of goods contract, and the third term of their written

agreement reads as follows:

“Seller and Buyer agree that time of delivery of the goods covered by this agreement is critical to the buyer. If the goods are not delivered by the date specified in this agreement, Buyer may consider buyer released from any further obligation to accept the goods, and may seek cover, as well as buyer’s reasonable incidental damages, but not buyer shall not be entitled to any consequential damages.”

7. This clause is:

a. A Condition Subsequent.

b. A Term.

c. A condition Precedent.

d. A Merger Clause.

e. None of the Above.