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Quizzes > Society & Culture > Politics & Civics

Put Your Contract Law Knowledge to the Test!

Think you can ace this contract law quiz? Dive in and tackle essential contract law questions!

Difficulty: Moderate
2-5mins
Learning OutcomesCheat Sheet
Paper art illustration of contract law quiz concept showing papers, scales of justice, pen on dark blue background.

This contract law quiz helps you work through test questions on offer and acceptance, consideration, and capacity so you can see what you know in minutes. Use it to check gaps before an exam, with extra multiple-choice practice and a short capacity check along the way.

What constitutes a valid offer in contract law?
A request for information
A mere invitation to treat
An expression of willingness to contract on specific terms
A statement of future intention
A valid offer is an expression of willingness to contract on specific terms whereby the offeror is prepared to be bound once the offeree accepts. Invitations to treat, statements of intention, or requests for information do not create binding obligations. Knowing this distinction is essential to identifying when a contract can form.
Which of the following best describes acceptance in contract law?
Performance without communication of assent
A request for clarification before agreeing
A counter-proposal suggesting different terms
Unqualified assent to all the terms of the offer
Acceptance must be a clear and unqualified assent to the exact terms of the offer. A counter-proposal or request for clarification does not amount to acceptance but rather rejects the original offer. Only a definite assent creates a binding contract.
What is consideration in contract law?
A written memorandum of the agreement
A party's unilateral promise without exchange
A judicial decree enforcing the contract
Something of value exchanged between the parties
Consideration is the benefit or detriment exchanged between parties, forming the price for which the promise is bought. Without consideration, most contracts are unenforceable. It ensures that each party has given something up or promised action.
Which category of persons generally lacks capacity to enter into a binding contract?
Minors under the age of majority
Incorporated companies
Sole proprietorships
Government agencies
Minors (those under the age of majority) lack full legal capacity to enter binding contracts, though contracts for necessities are enforceable. Incorporated companies and government agencies have capacity through statutory authority. Capacity rules protect vulnerable parties.
In which type of agreement is there a presumption of intention to create legal relations?
Agreements in a domestic setting
Social promises between friends
Informal household arrangements
Commercial agreements between businesses
Courts presume commercial agreements carry an intention to create legal relations because businesses act on economic incentives. Social or domestic agreements typically lack this presumption unless clear evidence shows otherwise. This rule helps distinguish legally enforceable contracts.
What does the mirror image rule require in contract formation?
Acceptance may add new terms
Counter-offers are valid acceptances
Performance without notice is always valid
Acceptance must exactly match the terms of the offer
Under the mirror image rule, acceptance must be identical to the offer's terms; any variation constitutes a counter-offer, not acceptance. This ensures there is mutual agreement on the same contract terms. The rule helps prevent misunderstandings.
A contract entered into under duress is generally:
Unenforceable only if in writing
Fully enforceable despite the duress
Automatically void
Voidable at the option of the coerced party
When a party enters a contract under duress, the contract is voidable, allowing the coerced party to affirm or rescind it. It is not automatically void but can be set aside. This protects individuals from unfair pressure.
What distinguishes a unilateral contract from a bilateral contract?
It must be in writing
No consideration is required
A promise in exchange for performance
Two promises exchanged
A unilateral contract involves one party's promise in exchange for the other party's performance, such as a reward offer. A bilateral contract involves mutual promises by both parties. Consideration arises differently in each.
What doctrine prevents a promisor from denying a promise when the promisee has reasonably relied on it to their detriment?
Promissory estoppel
Consideration
Frustration
Parol evidence rule
Promissory estoppel stops a promisor from reneging when the promisee has relied on a clear promise to their detriment. It substitutes for consideration when enforcing non-contractual promises. This equitable doctrine ensures fairness.
Why is past consideration typically not valid in contract law?
Only gifts are valid consideration
Past acts are expressly allowed by statute
It must be of equal value
It is not given in exchange for the current promise
Past consideration is something provided before the promise and was not given in exchange for the current promise, so it cannot form the basis of enforceable consideration. The bargain principle requires a quid pro quo.
Which doctrine addresses the enforcement of contractual promises by third parties?
Invitation to treat
Quantum meruit
Promissory estoppel
Privity of contract
The doctrine of privity of contract holds that only parties to a contract can enforce its terms. Third-party beneficiaries typically lack standing unless specific exceptions apply. This preserves contractual autonomy.
Under the Statute of Frauds, which type of contract must be in writing to be enforceable?
Contracts for sale of land
All oral employment agreements
Non-disclosure agreements
Bilateral gift promises
The Statute of Frauds requires certain contracts, including those for the sale of land, to be in writing to prevent fraud and misunderstandings. Other agreements may be oral. This statute sets formal requirements for enforceability.
What factor distinguishes duress from undue influence in contract law?
Duress requires physical compulsion only
Undue influence always voids the contract; duress does not
Duress involves external threats; undue influence involves abuse of a relationship
Undue influence applies only to minors
Duress involves coercion by threats or violence, while undue influence arises from abuse of a position of trust or power. Both can render a contract voidable, but their evidentiary requirements differ.
Which event allows a contract to be discharged by frustration?
A simple delay in performance
A change in market price
An unforeseen event making performance impossible
One party's financial difficulty
Frustration occurs when an unforeseen event beyond the parties' control renders contractual obligations impossible or radically different. Financial hardship or market changes do not usually qualify. This doctrine discharges future obligations.
What does the parol evidence rule generally prohibit?
Admission of prior oral agreements that contradict a written contract
Evidence of subsequent conduct
Testimony about future modifications
All oral evidence in any contract dispute
The parol evidence rule bars the use of prior or contemporaneous oral statements to contradict or modify the terms of a fully integrated written contract. It preserves the integrity of written agreements.
Which of the following is a characteristic of a valid liquidated damages clause?
A penalty far exceeding probable damages
A reasonable estimate of anticipated loss at contract formation
An unenforceable provision under all circumstances
An arbitrary sum set by one party after breach
A valid liquidated damages clause sets a genuine pre-estimate of loss anticipated at the time of contracting. Clauses designed as deterrents (penalties) are unenforceable. Reasonableness is assessed at formation.
Under the Sale of Goods Act, breaching which type of term entitles the buyer to reject the goods?
Warranty
Condition
Collateral term
Innominate term
Conditions are fundamental terms; breach of a condition allows the innocent party to reject the goods and treat the contract as at an end. Warranties only give rise to damages. The distinction is key in sale of goods disputes.
Which type of misrepresentation gives the right to rescind and claim damages for deceit?
Fraudulent misrepresentation
Statutory misrepresentation
Innocent misrepresentation
Negligent misrepresentation
Fraudulent misrepresentation occurs when a false statement is made knowingly or recklessly. It allows the claimant to rescind and seek damages for deceit. Other types may offer different remedies.
What is the main element distinguishing undue influence from ordinary persuasion?
Reliance on written notices
Offering better terms after agreement
Use of threatening language
Abuse of a position of trust or power
Undue influence arises when one party abuses a position of trust or authority to procure a contract. Ordinary persuasion involves free will and fair negotiation. Courts look for a relationship dynamic.
When can a party claim quantum meruit?
Only under written agreements
In cases of fraudulent misrepresentation
To recover reasonable value for work performed when no contract price is set
As a penalty for breach
Quantum meruit allows recovery of the reasonable value of services rendered when a contract does not specify remuneration. It prevents unjust enrichment. This remedy applies in quasi-contract scenarios.
Which statement about assignment of contractual rights is correct?
Assignments must always be in writing to be valid
Obligations can be assigned freely in the same way
No rights can be assigned without the other party's consent
Rights can be assigned unless it materially increases the obligor's burden
A party may assign contractual rights unless the assignment materially changes the obligor's duty or increases risk. Obligations generally require consent. Writing is not always mandatory except by statute.
Under the U.S. Electronic Signatures in Global and National Commerce Act (E-SIGN), electronic contracts are:
Limited to government transactions
As enforceable as their paper counterparts
Valid only with digital certificates
Unenforceable unless notarized
The E-SIGN Act gives legal effect to electronic records and signatures, making electronic contracts as enforceable as paper ones if certain consent requirements are met. It applies broadly, not just to government.
Which remedy is discretionary and may be granted when damages are inadequate?
Nominal damages
Specific performance
Quantum meruit
Liquidated damages
Specific performance is an equitable remedy compelling actual performance of the contract and is granted when damages are inadequate, such as in unique property cases. Courts have discretion in its application.
Under the Unfair Contract Terms Act (UCTA), when is an exclusion clause considered reasonable?
Only if approved by a court in advance
If it is in bold print only
When it passes a balance of bargaining power and knowledge test
Whenever one party signs the contract
UCTA requires that exclusion clauses be reasonable, considering factors like bargaining strength, availability of alternatives, and notice. Simply formatting a term in bold does not suffice. This ensures fairness.
Which test is used to imply terms necessary to give business efficacy to a contract?
The reasonable person's test
The best evidence rule
The officious bystander test
The economic duress test
The officious bystander test asks whether a term is so obvious that it goes without saying, and necessary for business efficacy. If so, courts may imply it. This helps fill gaps in contracts.
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Study Outcomes

  1. Understand Offer and Acceptance -

    Grasp the core principles of how offers are made and accepted in contract formation, equipping you to tackle contract law test questions with confidence.

  2. Analyze Consideration and Enforceability -

    Break down the concept of consideration and the requirements for a contract's enforceability, vital for success on any contract law quiz.

  3. Differentiate Types of Contracts -

    Identify and compare various contract forms - bilateral, unilateral, expressed, and implied - to master types of contracts questions effectively.

  4. Apply Legal Principles to Scenarios -

    Use real-world examples to apply contract law rules and answer practical contract law questions accurately.

  5. Evaluate Defenses and Remedies -

    Assess common defenses to contract enforcement and available remedies, ensuring you're prepared for any contract law test.

Cheat Sheet

  1. Offer and Acceptance -

    Offer and Acceptance form the mutual assent needed for a binding contract. Under the Mirror Image Rule (Restatement §59), acceptance must match the offer exactly - think "no surprises" to seal the deal (e.g., Lucy v. Zehmer). In contract law test questions, always identify the offeror, offeree, and the time acceptance was communicated.

  2. Consideration -

    Consideration requires a bargained-for exchange of legal value - both parties must give a benefit or incur a detriment (Restatement §71). Remember the "peppercorn rule": courts won't second-guess adequacy so long as something of value exists. When tackling contract law questions, always verify each promise has distinct consideration.

  3. Capacity and Legality -

    Parties must have legal capacity and the contract's purpose must be lawful (Restatement §§12 - 15). Minors can disaffirm most contracts; similarly, agreements for illegal acts or against public policy are void. Keep an eye out for infancy, intoxication, duress, or ex turpi causa in your contract law test questions.

  4. Statute of Frauds and Writing Requirements -

    Certain contracts (e.g., land sales, goods over $500 under UCC §2-201, or agreements not performable within one year) must be in writing to be enforceable. The writing need only include essential terms and a signature - remember "MYLEGS": Marriage, Year, Land, Executor, Goods >500, Surety. Quiz yourself by spotting missing elements in sample contract law quiz scenarios.

  5. Remedies and Defenses -

    When a contract is breached, remedies include expectation damages, restitution, and specific performance (see Hadley v. Baxendale for foreseeability). Defenses like unconscionability, mistake, or impossibility can bar enforcement (UCC §2-609). In contract law questions, match the remedy type to the breach facts and check for valid defenses.

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