MULTIPLE CHOICE QUESTIONS

7. In preparation for the annual convention of the Association of Life Insurance Agents which was to be held on January 9, Committee ordered 500 ball point pens from Penco at a total price of $285, paying for them in advance. Because the pens were to be given to conventioneers as souvenirs, they were to be imprinted with the name and slogan of the association, and were to be delivered to Committee on or before January 8. Penco and Committee entered into a written contract containing the above terms on November 16. Penco tendered 475 ball point pens to Committee on January 8. Which of the following correctly states the legal relationship between Committee and Penco on January 8?

(A) Committee must accept the tendered delivery of 475 pens, but may successfully sue for damages resulting from breach of contract.

(B) Committee may elect to accept the tendered delivery of 475 pens, but may not successfully sue for breach of contract if it does so.

(C) Committee may reject the tendered delivery of 475 pens, but may successfully sue only for the return of its advance payment if it does so.

(D) Committee may reject the tendered delivery of 475 pens, and may successfully sue for the return of its advance payment and for damages resulting from breach of contract if it does so.

8. Ace, a construction contractor, was planning to submit a bid for the renovation of a county office building. Ace called Wire, a subcontractor who had done electrical work for Ace in the past, and described the proposed project. Ace told Wire about the electrical work that would be required, and asked Wire to state the price that Wire would charge to do the electrical work for Ace. Wire inspected the office building on which the work was to be performed, and spent six hours estimating the cost of the job. Wire mailed Ace a letter describing the work to be performed, and containing the following statement: “I will do the work described for a total price of $16,000. This price is not subject to change until one week after the county awards the contract.” Wire subsequently purchased materials in anticipation of the job.

Ace submitted a bid for renovating the building, and was awarded the contract. Ace called Wire, offering to pay $12,000 for the electrical work. When Wire refused to accept anything less than $16,000, Ace hired Lectric to do the work instead of Wire.

If Wire sues Ace for the cost of the materials which Wire purchased in anticipation of the job, the court should find for

(A) Wire, if Ace relied on Wire’s offer in bidding on the job.

(B) Wire, if the materials which Wire purchased will not otherwise be used in the ordinary course of Wire’s business.

(C) Wire, if he purchased the materials in reliance on the belief that Ace would hire him upon receiving the contract from the county.

(D) Ace, because he had no agreement with Wire concerning the electrical work.