LAW 7107-02: CONTRACTS I
FINAL EXAMINATION -- FALL 1998

This exam consists of 3 questions. You have three hours in which to outline and write your answers. The questions count for various percentages of your final grade for this exam, so I advise you to allocate your time accordingly.

I strongly suggest that before you begin writing an answer you 1) read the question carefully; 2) think about exactly which issues you need to address; and 3) outline your answer. Good organization and good analysis almost always go hand-in-hand.

Please write your exam number above and turn in this exam with your answers. Use as many exam booklets as you need. Start your answer to each question in a new booklet and number the booklets so that I can easily follow their intended sequence. Write on one side only of each page, on every other line. For your benefit and my eyesight, please write as legibly as possible. I cannot grade what I cannot read.

This is an open book exam. You may use your casebook, statutory supplement, any material that I handed out in class, and any notes that you or your study group prepared. You may not use other materials, such as nutshells or commercial outlines.

Unless otherwise indicated, all events described below take place in a common law jurisdiction where the legislature has enacted the UCC. If you think it necessary to assume a fact in order to answer a question you may do so, but you should clearly indicate that you are making an assumption and briefly explain why you consider it reasonable to do so. If you have any procedural questions about taking this exam, please contact me in my office.

I've got a successful friend to whom people often say, "Gosh, you're lucky." She replies, "The harder I work, the luckier I get." May you, too, enjoy the success that your hard work merits.

Brown wanted to add some willow trees to the front yard of his house, so he called Green, the owner and operator of nursery business. Green offered to deliver and plant willow trees at $200 each. "I'll take two," said Brown.

The next morning, Green arrived as Brown was hurrying off for work. He told Green to deal with his gardener, Digs, who was standing nearby. To Digs he said, "I want the trees planted in a row along the road so that drivers cannot look into my front window." Brown then left.

Green handed Digs an invoice reading, "Two willow trees, delivered and planted, at $200 each. Total: $400." Digs signed the invoice and Green began unloading the trees. As Digs surveyed the situation, however, he realized that three trees would be necessary to satisfy Brown's demand for privacy. At Digs' request, Green pulled another willow tree off of her truck and planted all three trees. She edited the invoice solely by crossing out "$400" and writing "$600" in its place.

Brown was not pleased to see three willow trees in his front yard. "That extra tree will break my watering budget!" he complained. He called Green and demanded that she remove the unwanted tree. She refused to do so.

After Brown sent payment for only two of the trees, or $400, Green brought a contract suit for payment of another $200, for the delivery and planting of the third tree. Discuss the merits of her claim.

Buyer makes gumball machines. Seller makes mechanical coin sorters of the sort often used in gumball machines. Buyer called Seller to ask for a price quote on 1,000 coin sorters. Seller replied that she was having a special sale on coin sorters and could deliver 1,000 at a price of $1 each. Buyer asked if the usual 30-day warranty applied and Seller said that it did. Buyer said, "Great! Send us 1,000 of your coin sorters." "OK," said Seller.

The next day, Seller mailed one of its stock "Confirmation of Order" forms to Buyer. Seller had entered onto the form the price and quantity terms that she and Buyer had discussed. The bottom Seller's form said, "All special sale goods sold as is."

A few days later, Buyer sent a stock purchase order form to Seller. It made no reference to Seller's "Confirmation of Order" form but included identical price and quantity terms. The bottom of Buyer's form said, "All goods to carry the usual 30-day warranty. Payment due, per industry custom, within 30 days of receipt of goods."

Two weeks later, Seller delivered 1,000 coin sorters to Buyer. After another week had passed, Seller demanded payment. Buyer refused, saying that payment was not yet due. "In fact," said Buyer, "Because your coin sorters do not fit in our machines, we are going to return them to you without payment." Due to a series of bankruptcies among other buyers of mechanical coin sorters, Seller will find it quite hard to resell any sorters that Buyer returns to her.

Discuss the rights of Buyer and Seller.

Wall collects oil paintings. He has been trying for some years to commission a work from Muse, an artist well-known both for her brilliance and her eccentricity. Muse claims that "alien implants" have asked her to beautify Earth in preparation for their "Glorious Possession" of humankind. She has several times rejected generous offers from Wall on grounds that, as she said, "Your measly money will not suffice to advance my crusade on behalf of the Possessors."

Some people view Muse's proclamations as a mere publicity stunt whereas others think her quite sincere. Wall himself does not know whether Muse is cleverly bargaining for more money or genuinely seeking something less worldly. In August, he thus made her an offer calculated to cover both possibilities. "If you will prepare a painting for me," he wrote to her, "I will give you the choice between $1,000,000 (double my previous offer!) or my promise to put the painting on 1,000 billboards once my own alien implants tell me that the Glorious Possession is imminent. Please respond quickly. Signed, Wall."

Muse excitedly phoned Wall. She got a generic recording and left voice mail saying, "This is Muse. I accept your offer." Unbeknownst to her, Muse had called the wrong number and Wall never received her message. She immediately began to work on the painting.

In October Wall fell onto hard times. He wrote to Muse, saying, "I still want you to prepare a painting for me but I can no longer give you the option of accepting cash."

Muse received Wall's October letter but continued her work. As she did so, she reflected that Wall's offer demonstrated her growing fame and popularity. Her friends noticed that her eccentricities were becoming more pronounced. She began claiming to her friends that the "alien implants" were no longer merely encouraging her but ordering her to paint. By December she had finished Wall's painting. She wrote to him, "We the Possessors have seized control of Muse's body and have completed the painting that you requested. We will soon direct you to reproduce it on 1,000 billboards. Signed, Muse."

Surprised and pleased by this letter, Wall looked forward to receiving the painting. But it did not arrive after several weeks and Muse refused to return his messages. Wall has retained you as his attorney. Analyze the merits of Wall's contract claim against Muse and advise him on whether or not to bring suit.

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