Unit 3 Quiz Principles of Contract Interpretation

What do we mean when a contract is “silent” on an issue?

Which of the following would most likely be considered “equitable relief”?

Which of the following has the closest meaning to “meeting of the minds”?

Which of the following best expresses the function of courts in interpreting contracts?

Which of the following is not generally an element of contract formation?

Which of the following best explains  “looking to the four corners” of a contract for the contract’s meaning?

When is a contract term ambiguous?

If ambiguity is a question of law, who decides whether a term is ambiguous or not?

Which of the following most accurately refers to evidence outside the four corners of the contract?

On which of the following would a party most likey rely to exclude parol evidence?

Which of the following has the closest meaning to an integration clause?

Which is the most likely reason a party to a contract might insist that the contract state that it was drafted by both parties?

True or False. U. S. contracts are very formalistic, require lawyers to write them, and must be approved by notary publics before they can be signed by non-lawyers.

U. S. contracts for selling goods or services can be valid, even if they are not in writing, with certain exceptions.

Exceptions to the validity of oral contracts are found in statutes of frauds

Every valid oral contract can be easily proven in a court case.

True or False. Statutes of frauds are enacted by corporations and approved by their boards of directors.

True or False. Statutes of frauds establish time periods for filing court claims for breaches of legal duties.

True or False. Statutes of limitations establish time periods for filing court claims for breaches of legal duties.

True or False. Parties can agree on which State’s law governs their contract and include that agreement in
their contracts.

True or False. If parties do not state in their contract which State’s law governs the contract, then federal
(national) law governs the contract.

True or False. U. S. case law can only be found by going to the courthouses where the courts are located and
making copies of the legal decisions.

True or False. In contract cases, courts have the power to determine whether a contract exists and, if so, their
role is to determine what parties meant by hearing them testify about what they really intended,
regardless of the words in the contract.

True or False. Courts can freely substitute their own interpretation of a contract for what the parties intended
by their words.

True or False. When courts interpret contracts the best evidence of what the parties intended is the testimony
of expert witnesses about what the parties intended.

New York is the State with the highest level of trade with Mexico.

True or False. Each State has its own set of statutes and case law which govern contracts, which makes them
completely different from each other, with almost no similarities, even concerning basic
principles.

True or False. An offer to perform a service by one party in a contract is generally enforceable, even if the
other party has made no promise or payment in return.

True or False. Courts use a subjective standard, not an objective standard in interpreting contracts..

True or False. The “four corners” rule applies only in areas where four different States boundaries come
together (intersect).

True or False. The subjective standard of interpreting contracts is called the “two corners” rule.

True or False. The parol evidence rule states that if a contract is unambiguous (its words cannot be reasonably
interpreted to have more than one clear meaning) evidence outside the contract itself is not
admissible in court to interpret the contract.

True or False. Examples of parol evidence used to determine the meaning of ambiguities in contracts include
testimony by parties and prior drafts or communications between the parties.

True or False. Rule of interpretation or canons of construction originated in U. S. law and were unheard of
under English law.

True or False. Under the rule of interpretation called contra proferentem in Latin, contracts are always
construed in favor of the parties which drafted them and against the other party.