Which of the following may be used to redress the ultra vires acts committed by a
corporation?
a. Proceeding by shareholders for an injunction.
b. Suit by the corporation or shareholders derivatively against present or former
directors or officers for commission of the acts.
c. A proceeding by the attorney general of the state of incorporation to enjoin it from the
transaction of unauthorized business.
d. All of these may be used.
Concurrent conditions occur when mutual duties of performance are to take place
simultaneously.
a. True
b. False
Injunctive relief is a common remedy under the Lanham Act.
a. True
b. False
Conversion of an instrument will occur if:
a. a bank cashes a check with a forged indorsement.
b. a bank refuses to return a canceled check.
c. a bank takes a check from another bank.
d. an indorser gives a check to the bank.
A certificate of deposit differs from a promissory note in that:
a. the maker is always a bank.
b. there are three parties to the transaction.
c. the payee of a CD must be paid on demand.
d. Both the maker is always a bankand the payee of a CD must be paid on demand.
Yields on “junk bonds are higher than the rate of safe government bonds.
a. True
b. False
In DiLorenzo v. Valve & Primer Corporation, the court held:
a. DiLorenzo gave consideration for the stock option.
b. Valve & Primer conditioned the alleged stock option on DiLorenzos promise to
remain in its employment.
c. promissory estoppel applied because there was detrimental reliance on DiLorenzos
part.
d. there was no consideration for the stock option, and promissory estoppel did not
apply because detrimental reliance was not proven.
The statutory provisions governing dissolution and liquidation usually prescribe
procedures to safeguard the interests of the corporation’s creditors. These procedures
include:
a. the required mailing of notice to known creditors.
b. a general publication of notice.
c. the preservation of claims against the corporation.
d. All of these.
A tenancy for years must have a duration of at least two years, and notice to terminate
must be given at least one month before ending the lease.
a. True
b. False
a. Arthur brings his new computer to the Quick Fix Repair Shop to be fixed. Two days
later, a buyer comes into the shop, and Quick Fix inadvertently sells Arthur’s computer.
Arthur now wants his computer back. Can Arthur get his computer back? Explain.
b. Why do you think the Code follows this rule in situations such as the one above?
Explain.
In 1990, Congress enacted the Administrative Dispute Resolution Act. This Act does
not:
a. encourage the federal agencies to use arbitration.
b. authorize federal agencies to use mediation and conciliation.
c. require the agencies to use alternative dispute resolution.
d. All of the above.
A warranty creates a duty on the seller’s part that the goods and services she sells will
conform to certain qualities, characteristics, or conditions.
a. True
b. False
Charles says to Wes, “If you will mow my lawn, I will give you $15.” Wes says nothing,
but he mows the lawn. No contract exists under this fact situation, because Wes did not
accept Charles’s offer.
a. True
b. False
If no performance is rendered at all under a contract, then the damages will be the loss
of value of the promised performance.
a. True
b. False
Limited partners have limited liability for partnership obligations.
a. True
b. False
Courts have responded by piercing the veil when the shareholders have:
a. not followed the formalities of corporate procedures.
b. not provided an adequate financial basis for the business.
c. used the corporation to defraud.
d. All of these.
e. Not followed the formalities of corporate procedures orused the corporation to
defraud.
Under Chapter ___________, the bankruptcy estate does not include wages earned after
commencement of the case.
a. 7
b. 11
c. 13
d. All of the above
Wes, who is an art collector, offered to buy a print from Le Monde Gallery. Le Monde
balked at the price, sending Wes a letter of rejection. That day it discovered that the
print was not as highly valued as originally thought. Le Monde immediately telephoned
Wes to accept his offer. Is there a contract?
a. Yes, since the acceptance was received before the rejection.
b. No, because the rejection was effective upon dispatch.
c. No, because the rejection terminated the offer.
d. Yes, because the acceptance is always effective upon dispatch.
In an assignment for the benefit of creditors, if each creditor is paid a pro rata share of
his original obligation, the debtor is then discharged from any further obligation to the
creditor.
a. True
b. False
An accountant can ethically disclose a client’s confidential information if the accountant
complies with:
a. the client’s request.
b. Generally Accepted Auditing Standards requirements.
c. a court order.
d. All of these.
A compulsory share exchange happens when two companies wish to merge into one.
a. True
b. False
“Perfection” is required in order for the secured party to enforce rights against the
debtor.
a. True
b. False
Harms or injuries that are tortious may be inflicted:
a. intentionally.
b. negligently.
c. without fault.
d. In all of these ways.
The Revised Act takes the position that consolidations are, for all practical purposes,
obsolete.
a. True
b. False
a. State and local governments require licenses for certain businesses and professional
activities. Explain the difference between a regulatory licensing statute and a licensing
statute enacted to raise revenue.
b. Explain the significance in contract law between a regulatory license and a revenue
raising license.
c. Give an example of each type of licensing statute.
The rule which permits the jury to infer both negligent conduct and causation from the
mere occurrence of certain events is:
a. proximate cause.
b. res ipsa loquitur.
c. causation in fact.
d. comparative negligence.
A totten trust is revocable by the creator.
a. True
b. False
Big Burger Co. sues Bakum Corporation for breach of contract for $1,000 of hamburger
buns that were not delivered. Bakum may assert as a defense to payment that Big
Burger is not a de jure corporation.
a. True
b. False
Judicial review:
a. scrutinizes actions of federal, but not state, governments.
b. is a check by the judicial branch on legislative action.
c. is a check by the judicial branch on executive action.
d. is a check by the judicial branch on both legislative and executive action.
The Code and the Restatement both contain definitions of what constitutes
“unconscionable” conduct.
a. True
b. False
The Magnuson-Moss Warranty Act is administered by the Federal Trade Commission.
a. True
b. False