A Makes a Contract Under Which B Company Is to Repair

question 100

Multiple Choice

A makes a contract under which B Company is to repair and repaint A's pier.Under the contract,A has the right to specify the materials to be used.B Company induces A to specify the use of a particular paint that it made,giving A assurances of its quality.The paint is supplied by B Company,but it is found to be unsuitable,and A has to spend $40 000.00 to correct the matter.In a lawsuit by A against B

• A)the court will find that the inducement of the quality of paint was a collateral contract that formed the consideration for the main contract to repair and repaint A's pier.
• B)the court will find that B Company's inducement of the quality of the paint was a mere invitation to treat and nothing more.
• C)the court will be unable to get around the parol evidence rule and A will lose her or his law suit.
• D)the court will find that A should have ensured that the inducement of the quality of the paint was put into the written contract.
• E)the court will find that B Company's assurances about the quality of the paint is a condition precedent to the contract.

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Definitions:

Management Fee

A charge levied by an investment manager for managing an investment fund.

Fair Value Gain

Positive changes in the fair market value of investments or assets, reflecting increased worth.

Available-for-sale Financial Assets

Financial assets not classified as held for trading, held to maturity, or loans and receivables, and are thus measured at fair value with changes recognized in other comprehensive income.

Consolidated Statements

Financial statements that present the assets, liabilities, equity, income, expenses, and cash flows of a parent company and its subsidiaries as a single economic entity.