Business Law - Chapter 14 - Contractual
Capacity Exam Questions and Answers
1. Michael, a minor, operates a one-man automobile repair shop.
Anderson, having heard of Michael's good work on other cars, takes her
car to Michael's shop for a thorough engine overhaul. Michael, while
overhauling Anderson's engine, carelessly fits an unsuitable piston ring
on one of the pistons, with the result that Anderson's engine is seriously
damaged. Michael offers to return the sum that Anderson paid him for
his work, but refuses to pay for the damage. Can Anderson recover from
Michael in tort for the damage to her engine? Why? Correct Answer: Liability for
Tort Connected with Contract.
No. Decision for Michael. It is clear that the negligence by Michael in carelessly fitting an unsuitable
piston ring on one of the pistons, thereby seriously damaging the engine in Anderson's car, grew out of a
voidable contract (the contract of a minor— Michael); it would not have occurred had there been no
contract, and it is inextricably bound to and interwoven into the contract. To allow recovery for the tort
would indirectly enforce the contract, which the court would not permit.
2. Explain the outcome of each transaction.
(a)On March 20, Andy Small became seventeen years old, but he
appeared to be at least eighteen (the age of majority).
On April 1, he moved into a rooming house in Chicago where he orally
agreed to pay the landlady $300 a month for room and board, payable
at the end of each month. On April 30, he refused to pay his landlady for
his room and board for the month of April
(b)On April 4, he went to Honest Hal's Carfeteria and signed a contract to
buy a used car on credit with a small down payment. He made no
representation as to his age, but Honest Hal represented the car to be in
top condition, which it subsequently turned out not to be. . On April 25,
he returned the car to Honest Hal and demanded a refund of his down
payment.
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,Business Law - Chapter 14 - Contractual
Capacity Exam Questions and Answers
(c)On April 7, Andy sold and conveyed to Adam Smith a parcel of real estate
that he owned. On April 28, he demanded that Adam Smith reconvey the
lan Correct Answer: Liability
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Capacity Exam Questions and Answers
1. Michael, a minor, operates a one-man automobile repair shop.
Anderson, having heard of Michael's good work on other cars, takes her
car to Michael's shop for a thorough engine overhaul. Michael, while
overhauling Anderson's engine, carelessly fits an unsuitable piston ring
on one of the pistons, with the result that Anderson's engine is seriously
damaged. Michael offers to return the sum that Anderson paid him for
his work, but refuses to pay for the damage. Can Anderson recover from
Michael in tort for the damage to her engine? Why? Correct Answer: Liability for
Tort Connected with Contract.
No. Decision for Michael. It is clear that the negligence by Michael in carelessly fitting an unsuitable
piston ring on one of the pistons, thereby seriously damaging the engine in Anderson's car, grew out of a
voidable contract (the contract of a minor— Michael); it would not have occurred had there been no
contract, and it is inextricably bound to and interwoven into the contract. To allow recovery for the tort
would indirectly enforce the contract, which the court would not permit.
2. Explain the outcome of each transaction.
(a)On March 20, Andy Small became seventeen years old, but he
appeared to be at least eighteen (the age of majority).
On April 1, he moved into a rooming house in Chicago where he orally
agreed to pay the landlady $300 a month for room and board, payable
at the end of each month. On April 30, he refused to pay his landlady for
his room and board for the month of April
(b)On April 4, he went to Honest Hal's Carfeteria and signed a contract to
buy a used car on credit with a small down payment. He made no
representation as to his age, but Honest Hal represented the car to be in
top condition, which it subsequently turned out not to be. . On April 25,
he returned the car to Honest Hal and demanded a refund of his down
payment.
1/
8
,Business Law - Chapter 14 - Contractual
Capacity Exam Questions and Answers
(c)On April 7, Andy sold and conveyed to Adam Smith a parcel of real estate
that he owned. On April 28, he demanded that Adam Smith reconvey the
lan Correct Answer: Liability
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