Southwestern Foods Corporation operates a packaging plant near the border between
the United States and Mexico. Due to the location, it would be easier for Southwestern
to employ noncitizens. It is legal for a U.S. employer to
a. hire persons not authorized to work in the United States.
b. recruit persons not authorized to work in the United States.
c. refer for a fee persons not authorized to work in the United States.
d. none of the choices.
Johnny writes a check to Katie as payment for a 3D DVD player but soon discovers the
player is broken. He goes to the drawee bank and orally authorizes Sissy, a bank officer,
to stop payment on the check. This order is valid for
a. fourteen days.
b. fourteen months.
c. six days.
d. six months.
Fact Pattern 3-A3
Liz files a suit against Moe in a state court. The case proceeds to trial, after which the
court renders a verdict.
If either party appeals, the clerk of the trial court will send to the clerk of the appellate
court within a prescribed period of time
a. a brief including the arguments of both parties.
b. a copy of the record on appeal.
c. an explanation for the verdict.
d. a statement of the grounds for reversal.
Consumer Mortgage Loans provides Demi with a mortgage to buy a home. Under the
terms, Demi can choose to pay only the interest portion of the monthly payments and
forgo paying of the principal for five years. This is
a. a fixed-rate mortgage.
b. an adjustable-rate mortgage.
c. an interest-only mortgage.
d. a violation of the law.
Boz, a clerk for a Cheezy Burger, Inc., restaurant goes out on strike with the other
employees. After the strike, Boz must be given his job back if there is still work at the
restaurant and the strike was
a. a lawful economic strike.
b. an “excuse for a few days off.
c. an unjustified strike.
d. an unlawful “practice strike.
An antitrust action is brought against Tri-State Transport Company, alleging the offense
of attempted monopolization. To be guilty of this offense, Tri-States attempt must have
a. a dangerous probability of success.
b. a deadly guaranty of success.
c. a distant possibility of success.
d. a distinct improbability of success.
Lex, a salesperson for Macro Corporation, learns that Macro will increase the dividend
it pays to shareholders. Lex buys 1,000 shares of Macro stock. When the price
increases, Lex sells his shares for a profit. Lex would not be liable for insider trading if
the information about the dividend was
a. material when he sold the stock.
b. public after he bought the stock.
c. public before he bought the stock.
d. too speculative when he bought the stock.
VeriVisual Company makes HD 3D film and video equipment. VeriVisual is like most
corporations in that its officers are hired by the firms
a. board of directors.
b. incorporators.
c. other officers.
d. shareholders.
Consumer Payments Processing Corporation (CPPC) and Mall Kiosk Company make a
deal for CPPCs services, via e-records. Under the UETA, an e-record is considered
received when
a. it enters the recipients processing system in a readable form.
b. the recipient is aware of its receipt.
c. the recipient is aware that it has been sent.
d. it leaves the senders control.
Ozzy is an officer of Prudent Financial Corporation. Ozzy serves in a representative
capacity for Prudent Financials owners. With respect to binding Prudent Financial to
contracts, Ozzy is
a. an agent and has the authority.
b. an agent but does not have the authority.
c. not an agent and does not have the authority.
d. not an agent but does have the authority.
Kettlecorn Investments, Inc., and Lone Tree Bank are secured parties with security
interests in property owned by Metal Fabrication Corporation. Priority between these
security interests is generally determined by
a. the amount of the claim.
b. the custom in the trade.
c. the time of perfection or attachment.
d. the “float of the liens.
As a joke, Fran hides Garys business law textbook so that he cannot find it during the
week before the exam. Fran is liable for
a. appropriation.
b. disparagement of property.
c. trespass to personal property.
d. wrongful interference with a business relationship.
To protect its trade secrets, Gnu Processes, Inc., may require employees that have
access to the secrets to agree in their employment contracts not to
a. compete with Gnu.
b. memorize the trade secrets.
c. quit working for Gnu.
d. think about the trade secrets after work.
Mall Stores Corporation owns 95 percent of the shares of Niche Shoppes Corporation.
Through a certain transaction, Mall Stores combines with Niche Shoppes, but only Mall
Stores continues to exist. This is
a. a consolidation.
b. a share exchange.
c. a short-form merger.
d. a termination.
Beyond-the-Sea Corporation and Homeport Company make a deal for Homeports
products, via e-records. Under the UETA, an e-record is considered sent when it
a. is signed and encrypted, and will be sent without changes.
b. is stored in the senders back-up system.
c. is composed on the senders computer.
d. leaves the senders control.
Denise and Elke do business as Final Curtain Decorators. In most states, for purposes of
holding title to property, this partnership would be treated as
a. an aggregate of the individual partners.
b. a natural person.
c. an entity.
d. a non-existent party.
Ulrich, a citizen of Virginia, wants to enforce in the state of Washington certain rights
that he has under a contract with Xtreme SnoBoards Inc. A Washington state court is
most likely to enforce such rights under
a. no provision in the U.S. Constitution.
b. the commerce clause.
c. the full faith and credit clause.
d. the privileges and immunities clause.
Toni files a suit against Universal Media Corporation for defamation. Actual malice
must be shown for recovery of damages if Toni is
a. a corporate officer.
b. a non-employee.
c. a private individual.
d. a public figure.
Ryan signs an instrument using an “R with a circle around it. With this mark for a
signature, the instrument is
a. negotiable.
b. nonnegotiable, because an initial does not state the signers name.
c. nonnegotiable, because this mark is a symbol, not a signature.
d. nonnegotiable, because a simple mark implies a lack of serious intent.
Pharma Meds Corporation employs Ogilvie under an employment contract that sets out
a specific amount of money to be paid for certain results over a stated period of time.
During the term of the contract, it becomes clear that the results are not likely to be
attained. Pharma then gives Ogilvie the option of accepting a lesser position with fewer
duties for less money. Ogilvie accepts via e-mail, but soon files a suit against Pharma
for breach of the original contract. The court is most likely to rule that Ogilvies e-mail
a. showed only an agreement to agree.
b. accepted the proposed modification of the employment contract.
c. constituted a non-binding, non-contractual communication.
d. contained an acceptance but is unenforceable because it is electronic.
Owen takes a Paisley-made pinball machine to Quality Games, Inc., for repair. Lacking
certain parts, Quality ships the game to Regal Company. While in Regals possession,
the game is damaged. Quality can recover for the damage from
a. no one.
b. Owen.
c. Paisley.
d. Regal.
Spreadeagle, Inc., is a publicly held company. Spreadeagles executives include Tybalt,
who serves as the firms chief financial officer. The Sarbanes-Oxley Act of 2002
provided for the establishment and appointment of a federal Public Company
Accounting Oversight Board (PCAOB). The PCAOB was created to
a. set and police auditing standards for publicly held companies.
b. oversee presidential appointees to federal accounting positions.
c. regulate the salaries of public company executives and others.
d. issue a revised set of international financial reporting standards.
SealCoat Paving enters into a contract with Royal Golf & Tennis Club to provide
surface material for Royals tennis courts by April 1 for a tournament to begin May The
contract specifies an amount to be paid if the contract is breached. This is a liquidated
damages clause if the amount is
a. meant to pay for additional liquid sealant in the event of damage.
b. a reasonable estimate of the loss on a breach.
c. designed to penalize the breaching party.
d. intended to quickly provide cash to the nonbreaching party.
Fast Food Corporation and Giant Potatoes, Inc., enter into a contract for Giants sale to
Fast of all of the potatoes that Fast needs. The amount of potatoes that Giant must
supply is
a. all of Fasts requirements that may occur in good faith.
b. all of Giants output that is not commercially impracticable.
c. the greatest quantity that is not unconscionable.
d. the greatest quantity that makes the contract a ‘square deal.
Green Glass Corporation makes glass bottles for food and beverage makers to package
their products for wholesale distribution and retail sale. Liability may be imposed on
Green Glass based on
a. the “reasonableness of the manufacturers quality control efforts.
b. the type of the manufacturers insurance coverage.
c. a manufacturing defect.
d. the opinion and testimony of non-experts.
Real Events Promotion Corporation licenses trademarks to Stadium Souvenirs, Inc., to
use in selling caps, sweatshirts, and similar goods. This is
a. a franchise.
b. an entrepreneur.
c. a principal-agent relationship.
d. a sole proprietorship.
The United Association of Video Game Designers, which does not include all video
game makers, refuses to deal with any parties who do not carry the products of its
members. This group boycott is
a. a situation that neither restrains trade or harms competition.
b. a legal restraint of trade.
c. a per se violation of antitrust law.
d. subject to analysis under the rule of reason.
Myra owns a house, which she advertises for sale for $400,000. On May 1, Nico offers
Myra $380,000 for the house. On May 5, Myra has delivered to Nico at his office a
form that includes additional terms but does not state a price. At 9 a.m. on May 6, Nico
signs the form and gives it to Odell, his administrative assistant, with instructions to
mail it. At 10 a.m., Myra calls to tell Nico that the deal is off. The next day, Odell mails
the signed form to Myra. When she refuses to sell the house to Nico, he files a suit
against her, alleging breach of contract. Myra claims that there was no contract. What
are arguments supporting each partys position? What is the court likely to rule?
Explain.
Gene steals Hilarys brooch and sells it to Imelda. Hilary can recover the brooch from
Imelda
a. only if Imelda did not know that the brooch was stolen.
b. only if Imelda did not give sufficient consideration for the brooch.
c. only if Imelda knew that the brooch was stolen.
d. under any circumstances.
Jack and Kyra are partners in Law Firm, LLP, a limited liability partnership. Jack
supervises Kyra, who negligently fails to appear in court on behalf of Milo, a client.
Liability to Milo rests with
a. Jack and Kyra.
b. Jack only.
c. Kyra only.
d. neither Jack nor Kyra.
Fact Pattern 19-A1
Olisa enters into a contract to buy a stove from Pay-to-Own Appliance store with the
price to be paid in monthly installments. After thirty-six months of payments, Olisa has
paid more than twice the price of a similar stove. Eighteen payments remain due under
the contract.
Under the UCC, the court can evaluate the contract to determine whether it was
unreasonably unfair and one sided
a. at the time it was made.
b. at the end of its term.
c. in the middle of its performance.
d. at the time of Gails suit.
A person whose name is forged on an instrument is liable to pay only a holder in due
course the value of the forged instrument.
The Americans with Disabilities Act of 1990 requires that employers accommodate the
needs of applicants or employees with disabilities who are not otherwise qualified for
the work
A promise to do what one already has a legal duty to do is legally sufficient
consideration.
Only the U.S. Department of Justice can prosecute violations of all of the antitrust laws.
A contract may include a clause stating that no damages can be recovered for a certain
type of breach.
In defense against payment, an insurance company can raise any of the defenses that
would be valid in an ordinary action on a contract.
A bill of lading serves as a contract for the transportation of goods.
A case is remanded when it is sent back for further proceedings to the court that
originally heard the case.
To be legally sufficient, consideration must include something of economic value.
A creditors composition agreement is usually held to be unenforceable.
Delivery of intangible personal property must always be accomplished by actual
delivery.
On default, a secured party who chooses not to retain the collateral must dispose of it in
a commercially reasonable manner.
The possession of monopoly power is only one element of the offense of
monopolization.
Oral evidence of the modification of a contract after its making can be introduced at a
trial.
An acceptance subject to new conditions implicitly rejects the offer.