1. Mr. Johnson states in a letter to his niece, Carla, "If you're interested, as soon as I purchase a new car, you can have my old one." Carla immediately writes back and enthusiastically agrees to his proposal. One month later, Mr. Johnson buys a new car and uses the old one as a trade-in. Is Mr. Johnson in breach of contract with Carla?

2. Baxter Fence Company agrees to erect a six foot chain link fence around the perimeter of Buddy's residential property in Menomonie in exchange for $5,000. The next day, Buddy discovers that he is prohibited by city ordinance from erecting such a fence in the part of Menomonie where his home is located. Is Buddy in breach of contract with Baxter Fence Company? 10 Points

3. Capacity to Contract-Minor-

On June 1st, seventeen year old Allie Jones signed a one-year lease with Nice Homes Property Management for a one bedroom apartment. The lease term was to begin September 1st at a rent of $400 per month. Allie moved into the apartment on Sept. 1st and lived there for three months. Then she realized she couldn't afford to live on her own and moved back in with her parents. Allie immediately notified Nice Homes that she was disaffirming the contract, returned the keys and asked for a refund of all rent paid. Nice Homes re-rented the apartment four months later and then contacted Allie to collect the four months' rent that they lost. Allie refused to pay. Nice Homes has now sued Allie for the lost rent. Answer the following questions, explaining your answers in full.

a. Did Allie lack capacity at the time of entering into the lease?

b. Would the apartment be a necessary under these circumstances?

c. If Allie turned eighteen during the three months that she lived in the apartment, what affect would that have on your answers?