Contracts C9-10 Capacity & Legality

All contracts that involve an illegal act are unenforceable.

• True
• False

Contracts in which one person pays another to commit a felony are unenforceable.

• True
• False

Gambling arises when luck is the determinant of whether you can collect on the agreement.

• True
• False

Charging interest at a rate higher than allowed by law is called

• compounding a crime
• wagering
• excessive interest
• usury

If you agreed to pay a witness to be sure that she testified for you at a trial, this agreement would be unenforceable.

• True
• False

Restitution is 

• the enforcement of an agreement
• getting back something you have given

Illegal agreements are not enforceable unless one party has performed all of the obligations.

• True
• False

A party to an illegal contract can either enforce the agreement or obtain restitution if they

• are excusable ignorant
• are a protected victim
• rescind before the illegal act occurs
• none of the above

In general, illegal agreements cannot be enforced but restitution is available.

• True
• False

_____ is the ability to incur legal obligations and acquire legal rights. 

• A.  Capacity  
• B.  Emancipation 
• C.  Necessity  
• D.  Disaffirmance