Jose and Mei Entered into What Appeared to Be a Contract

question 27

Multiple Choice

Jose and Mei entered into what appeared to be a contract for the sale of an antique automobile.Jose agreed to pay the purchase price and Mei agreed to deliver the car to Jose's garage.Secretly,however,Mei planned to keep the car for herself.Will a court enforce the agreement?

• A)A court will not enforce the agreement because the existence of Mei's secret plan meant that the parties did not really agree to the same thing.
• B)A court will not enforce the agreement because Mei expected to keep the automobile and contract law tries to protect reasonable expectations.
• C)A court will enforce the agreement because a reasonable person would have concluded that the parties entered into an exchange of promises for value.
• D)A court will enforce the agreement because Mei behaved badly and the court wants to punish that type of behaviour.
• E)A court will not enforce the agreement because business people must be able to rely on outward appearances.

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Definitions:

Truth-in-Lending Act

U.S. federal law designed to promote transparency in consumer credit by requiring lenders to disclose important terms and costs of loans to borrowers.

Secured by Mortgage

Describes a loan or obligation guaranteed with the collateral of real estate property through a legal agreement.

Real Estate

Property consisting of land and the buildings on it, along with its natural resources, typically categorized into residential, commercial, or industrial properties.

Lemon Laws

Laws designed to protect consumers from fraudulently represented defective vehicles, allowing buyers to get a refund or replacement for a "lemon" car.