CONTRACTS §MYA

PROFESSOR JANICE KOSEL

MIDTERM EXAM

SPRING 2001


INSTRUCTIONS


This is a closed book exam. There are TWO PARTS to this examination -- MULTIPLE CHOICE and ESSAY.

PART I 

The MULTIPLE CHOICE segment, is WORTH 1/3 of your grade. Indicate the best answer on the Pat-SCORE Test Form provided.

PART II 

The ESSAY segment, is WORTH 2/3 of your grade. If you believe you lack sufficient facts to answer the question, please specify what additional

information you require and how it will affect your answer.

 

The total time for this exam is 3 hours. You may allocate your time as you wish.

Read, think and analyze before you begin to write.

Good luck and have a great holiday!

 

II

You are the general counsel of Golden State University. Yesterday a number of cases were presented to you, including:

A. Dorothy Donor, a wealthy 98 year old alumnae of the law school, died last week. Her heirs have indicated their unwillingness to honor her promised gift of $5 million to the institution because they believe the world already has enough lawyers. Dorothy announced her gift last May at graduation when she was named alumni of the year. She said the gift was in recognition of the superior education she had received at the school.

Unfortunately, in the meantime, the university has made several commitments for use of the funds, including a construction contract in the amount of $1 million for building renovations and promises of financial aid in the amount of $10,000 each to fifty entering students.

Can the university enforce Dorothy's gift? Why or why not?

 

B. Eager Eddie is one of the newly admitted law students orally promised a $10,000 scholarship by the director of admissions. Because the university does not have the money yet, it notified Eddie that it was withdrawing the scholarship offer but not the offer of admission. Unfortunately, in the meantime, Eddie has turned down three other law schools and paid a nonrefundable deposit of $500 at Golden State. Eddie is about to have a nervous breakdown.

Advise the law school about what liability, if any, they have to Eddie.

 

C. The contractor is secretly delighted that the university was unable to continue the construction contract. She seriously underestimated the cost of construction. Total costs were estimated to be $900,000. Already, costs in the amount of $300,000 have been incurred for work projected to cost only $175,000. The contractor intends to sue Golden State for $400,000.

Advise the law school about what liability they have to the contractor.