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A contract to sell life insurance is covered by Article 2 of the Uniform Commercial
Code.
a. True
b. False
Steven owes Theresa $100 for a used computer which he bought last year at Theresa's
garage sale. The two agree that the debt can be paid by Steven's shoveling Theresa's
driveway from January through March. The new contract is a(n):
a. accord.
b. satisfaction.
c. novation.
d. rescission.
RICO provides for criminal penalties, but contains no provision for civil penalties.
a. True
b. False
Automatic perfection means that:
a. no financing statement need be filed.
b. no agreement need be made between the debtor and the secured party.
c. no value need be advanced.
d. All of these.
An output contract is a special form of an illusory contract.
a. True
b. False
The legal effect of a usurious loan varies from state to state.
a. True
b. False
When the rights under a contract are highly personal, they are not assignable.
a. True
b. False
There are four major types of deeds.
a. True
b. False
To be effective, an offer must:
a. be sufficiently definite and certain.
b. be communicated to the offeree.
c. manifest an intent to enter into a contract.
d. All of these.
e. None of these.
The earned surplus test for the issuance of dividends by a corporation is less restrictive
than the surplus test.
a. True
b. False
The Bankruptcy Code grants to U.S. District Courts original and exclusive jurisdiction
over all bankruptcy cases.
a. True
b. False
Bill's car broke down on a dark, rainy night. Along came Andy in his service station's
four-wheel drive truck with tools and supplies in the back. Bill didn't have any credit
cards and only $3.25 cash, so Andy told him to write a check or an IOU. Neither Andy
nor Bill had any paper, so Bill wrote on the cover of Andy's lunchbox: "If my car is
fixed right by Andy Walcott, I will pay him $150. (Signed) Bill Boyd." Andy indorses
the note and takes it to a commercial factor for negotiation. The factor refuses, saying it
is non-negotiable because it:
a. is written on a lunchbox.
b. is conditional on satisfactory repair of the car.
c. mentions the existence of a contract to repair the car.
d. All of these.
e. None of these.
An accommodation party's liability is determined by the capacity in which he signs.
a. True
b. False
Intangible property does not exist in a physical form.
a. True
b. False
Ryan is interested in purchasing two dozen L.E.D. signs from Superior Sign Co. If the
signs are damaged:
a. and destroyed before Ryans offer to buy them is accepted, Superior must create new
signs to replace the ones Ryan wanted.
b. after the contract of sale is formed and after the risk of loss passed to Ryan, then
Ryan has no option but must pay the entire contract price of the signs.
c. without fault of either party before the risk of loss passes to Ryan and the goods were
identified when the contract was made, the contract is avoided whether the signs are
totally or partially destroyed.
d. All of these.
EDGAR is the computer system established by the SEC to perform automated
collection, validation, and dissemination of required reports.
a. True
b. False
The intermediate equal protection test:
a. does not require governmental classification to bear a substantial relationship to an
important governmental objective.
b. eliminates the strong presumption of constitutionality that exists under the rational
relationship test.
c. does not allow taking into legislative consideration the natural physical differences of
gender.
d. requires that men and women be treated exactly the same with regard to
governmental action.
An implied warranty exists by operation of law.
a. True
b. False
Monopoly power is tested by determining how big the corporation is in terms of total
assets.
a. True
b. False
Invasion of privacy is in reality a collection of four distinct torts.
a. True
b. False
Francenie was digging a trench to install a drainage pipe along her property line and she
accidentally tunneled under a small area on her neighbors property. The entry onto the
neighbors property:
a. cannot be a trespass because it was beneath the surface of the land.
b. is not a trespass unless there was some actual damage to the neighbors land.
c. is a trespass.
d. is not a trespass because Francenie was under the reasonable belief that she owned all
of the land on which she was digging.
If Barker Co. buys 51% of the shares of Carter Co.:
a. Carter Co.'s board would have to approve the sale.
b. Barker Co.'s board would have to approve the sale.
c. both boards would have to approve the sale.
d. both sets of shareholders would have to approve the sale.
Relationships that may lead to a courts careful scrutinization of contracts between the
parties to make sure undue influence was not present include all but:
a. agent and principal.
b. salesperson and customer.
c. parent and child.
d. doctor and patient.
Fines imposed on individuals for violating the Foreign Corrupt Practices Act may be
paid, either directly or indirectly, by the domestic concern on whose behalf they acted.
a. True
b. False
All ALJ decisions must include a statement of findings of fact and conclusions of law
and the reasons or basis for them, as well as a statement of the appropriate relief.
a. True
b. False
Generally, only a public representative, such as the attorney general, may sue to stop a
public nuisance.
a. True
b. False
The 1990 amendments to the Clean Air Act:
a. require the EPA to decide whether an SIP is complete; if it is, the EPA must approve
or disapprove the plan within six months.
b. attempt to halt environmental destruction caused by acid rain.
c. do not permit utilities to sell their emission allowances.
d. allot sulfur dioxide emission allowances to utilities based on the "bubble concept.
Barbara, a wealthy widow, promises the pastor of her church that she will donate
$30,000 to the church to help pay off its mortgage if the stewardship committee can
obtain enough pledges for the balance of the $60,000 mortgage. Other pledges are
obtained to pay off the mortgage, but now Barbara has changed her mind and plans to
take an around-the-world cruise instead. In this case:
a. Barbara's promise to pay $30,000 is enforceable because it was a promise made to
satisfy a preexisting moral obligation.
b. the promise to pay $30,000 is a promise to give a gift and is therefore not
enforceable.
c. under the Restatement of Contracts, Barbara's promise is enforceable.
d. Two of these.
Administrative hearings are held before a jury, just as are court hearings.
a. True
b. False
If the general partnership is bound by a contract, then each individual general partner
has unlimited personal liability for that obligation.
a. True
b. False
Under the Second Restatement, a possessor of land must warn licensees of dangerous
conditions of which the possessor has knowledge and the licensees do not and which
they are not likely to discover.
a. True
b. False
On the due date, Merrel makes proper tender of full payment of a note to Russell, who
is entitled to payment. If Russell refuses payment, Merrel is discharged from liability
for:
a. the face amount of the note.
b. any interest accrued until the time of tender.
c. interest after the due date.
d. All of these are correct.
The U.S. Supreme Court:
a. has only appellate jurisdiction, as the nation's highest tribunal.
b. must accept for review any decision appealed under a writ of certiorari.
c. has original jurisdiction over certain types of cases.
d. hears most of its cases through an appeal by right.
Discuss the concept of ratification and the ways in which a minor may ratify a contract.
Give an example.
Identify the elements a plaintiff must prove in an action for negligence.
What transactions are enforceable even though they are not supported by consideration?
Define legal detriment.
Ken, a research chemist, has been promised a fellowship with a stipend of $10,000 to
do research on synthetic fuel oil. Under the terms of the fellowship, Ken is free to use
the money as he sees fit. Ken decides to build his own laboratory, so he will not have to
rent one. He hires a carpenter who begins working on shelving and cabinets in the
laboratory. Then Ken receives a telegram saying the fellowship has been canceled. No
reason is given for the cancellation. If Ken sues, will he be able to collect the money
from the foundation which promised the fellowship? Explain your answer using legal
terminology.
The All-Power Gas and Electric Company cleared a right of way across Larry's land
and put up a power line, which it has maintained for the past 20 years. Now the
company wants to replace the old line with a new one, and Larry has decided he doesn't
want them on his land. Does the company have a recognizable interest in Larrys land?
Can Larry keep the company from installing a new line?
Name the two basic types of authority with regard to agents and explain the difference
between them.
Discuss the effect of a court's declaring someone incompetent and appointing a
guardian.
Explain how state courts are affected by federal court decisions under the doctrine of
stare decisis.
Lance has a contract with Smith to resurface a driveway at the Smith residence. Lance
by mistake stops at the Jones residence and resurfaces Jones' driveway. Jones lives next
door to Smith and knows that Lance is at the wrong residence. Jones, however, says
nothing and watches while Lance resurfaces his driveway. Is Jones under any
contractual obligation to pay Lance for resurfacing his driveway? Explain your answer.
What is an administrative agency? What powers does an administrative agency
possess?
What is electronic funds transfer? Why do banks like it? What provisions are in the law
to protect the customer who uses electronic funds transfer?
Discuss the role of judicial review in relation to administrative agencies.
Describe how a criminal case is commenced. What are the various stages in the
proceeding? Be sure to use the correct terminology.
What are the two major issues that the NEPA (National Environmental Policy Act)
addresses?
Give an example of an assignment of rights and explain the relationship of the parties.
Discuss the concept of adequacy of consideration.
Discuss common problems related to private causes of action with reference to the
environment.
