The Dodd-Frank Act amends the 1933 and 1934 Acts to require knowledge as the
mental state required for the SEC to bring aiding and abetting cases.
a. True
b. False
When delivery is to be made without moving the goods, unless otherwise agreed, title
passes:
a. at the time and place of contracting under all circumstances.
b. when a document of title is created if a negotiable document of title is involved.
c. when the goods are identified if they were not identified at the time of contracting.
d. at the time the seller completes performance.
The Fourth Amendment to the Constitution:
a. requires a speedy trial.
b. prevents double jeopardy.
c. prohibits unreasonable search and seizure.
d. All of these.
A court may meet the requirement of jurisdiction over a defendant in all but which of
the following ways?
a. In personam jurisdiction.
b. Voluntary submission to the courts power by the partys filing pleadings with the
court.
c. In rem jurisdiction.
d. Attachment jurisdiction.
A writ of execution is issued after a judgment against the debtor is entered in court.
a. True
b. False
Lyle offers to sell his house to Dennis for $95,000. Dennis responds, “I will pay you
$95,000 for the house if you first paint the second floor.” This response could best be
described as:
a. an acceptance.
b. a counteroffer.
c. a rejection.
d. an invitation.
With respect to horizontal privity, the strict liability in tort of manufacturers and other
sellers extends to only buyers, users, and consumers, but not to injured bystanders.
a. True
b. False
Typically, members of a limited liability company have the right to vote on proposals
to:
a. adopt or amend the operating agreement.
b. admit any person as a member.
c. sell all or substantially all of the limited liability company’s assets prior to
dissolution.
d. merge the limited liability company with another limited liability company.
e. All of these.
To accomplish the basic purposes of contract remedies, which of the following
limitations have not been imposed upon monetary damages?
a. Foreseeability.
b. Certainty.
c. Mitigation.
d. Restitution.
If a court finds a contract unconscionable:
a. the court may refuse to enforce only the unconscionable part.
b. it must, in all states, be found both substantively and procedurally unconscionable to
be unenforceable.
c. the court must refuse to enforce the contract.
d. the contract must fall strictly within the Codes or the Restatements definition of
“unconscionable to be unenforceable.
During the twentieth century it became easier to enter into a contract as well as to get
out of one.
a. True
b. False
In the Berardi v. Meadowbrook Mall Company case, the court found:
a. plaintiffs must produce subjective evidence of their duress to win a case of economic
duress.
b. duress is readily accepted by the courts as a reason to avoid a contract.
c. economic duress must leave the plaintiff no reasonable alternative but to acquiesce to
the terms of the contract.
d. plaintiffs who prove economic duress may void the transaction, and this is their
complete remedy.
The executor or administrator does not occupy a fiduciary relationship with regard to
the estate.
a. True
b. False
The remedies for infringement under the Patent Act are:
a. treble damages, when appropriate.
b. fines, in cases of knowing infringement.
c. imprisonment, in cases of knowing infringement.
d. All of these.
No apparent authority exists where the third party knows that the agent has no actual
authority.
a. True
b. False
Lostowne was economically depressed until Sally’s Firecracker Corp. moved its factory
there. Test explosions and the acrid smell of sulfur then interfered with Bob’s enjoyment
of the old family home. Bob sues Sally for nuisance and seeks a court-ordered
injunction to close down the factory. In determining whether the injunction is
appropriate, the court will:
a. “balance the equities.”
b. consider the gravity of harm to Bob and his family.
c. consider the social value of Sally’s business.
d. consider the public interest in the jobs created by Sally’s and the economic upturn in
Lostowne.
e. All of these.
Title insurance policies may be issued to protect the interests of mortgagees or tenants
of property.
a. True
b. False
Brad wrote a check to Clara for $1,000 on his account at First Bank. He then took it to
his bank for certification. The bank wrote “certified” on the face of the check. Brad then
gave the check to Clara. When Clara took the check to First Bank, they refused to pay,
claiming that there was not enough money in Brad’s account to cover the check. Which
of the following is correct?
a. First Bank is primarily liable on the check, because it has already accepted it.
b. Clara has no recourse under the circumstances.
c. Brad is secondarily liable on the check, because he is the drawer.
d. First Bank must pay the check, but they may charge Brad a fee to do so.
A factor demanding the ethical and social responsibility of business is:
a. the “invisible hand” of competition.
b. the sheer size and power of individual corporations.
c. the fact that self-regulation has been effective in achieving social goals.
d. great amounts of wealth and economic power are controlled by a small number of
shareholders who own and exercise tight control over a large number of corporations.
Anders Builders builds and sells new residences. According to the law in all states,
Anders impliedly warrants to the original purchasers and to subsequent buyers for a
reasonable time that the houses are free of latent defects.
a. True
b. False
The Commerce Clause in combination with the __________ limits the power of the
states to tax.
a. Fifth and Fourteenth Amendments
b. Equal Protection Clause of the Fourteenth Amendment
c. Takings Clause
d. Import-Export Clause
B& B, Inc. pays an attorney to draft and lobby for a bill which will greatly lessen B &
B’s tax liability to the state and federal governments. B&B gives the attorney $20,000 in
cash to pay legislators for taking the time to listen to him. This is an agreement which is
a violation of public policy.
a. True
b. False
Gary hires Doug to burn off his fields to kill the weeds. If the fire gets out of control
because of Dougs negligence and the fire damages Philips wood fence:
a. Gary has no liability because Doug was an independent contractor.
b. Doug bears sole responsibility for damage to the fence because it was his negligence
that caused the fire to escape the intended boundaries.
c. Gary is vicariously liable because he authorized an abnormally dangerous activity.
d. Philip cannot hold Gary liable unless Gary was personally involved in the act of
burning the fields.
Former partners, as well as current partners, have some rights to access partnership
books and records.
a. True
b. False
American jurists __________ and __________ defined law in a functional sense as
predictions of the way that a court will decide specific legal questions.
a. Roscoe Pound and Alexander Hamilton
b. Blackstone and Austin
c. Roscoe Pound and Benjamin Cardozo
d. Oliver Wendell Holmes and Benjamin Cardozo
Corporations today outnumber unincorporated business associations plus sole
proprietorships.
a. True
b. False
If Elizabeth, agent for Wade, finds out one of Wades customers has become insolvent,
she has the duty to communicate this information to Wade.
a. True
b. False
Marilyn, George, and Christine pool their money to buy land to operate a vegetable
farm from which they plan to sell the produce and share the profits or losses. Are they
partners?
a. Yes, since they are associating to carry on a for-profit business which they co-own.
b. No, because they each control the use of the land.
c. Yes, because if there is a loss in the land’s value, they will all share that loss.
d. No, they are merely joint venturers.
The validity, under antitrust law, of a joint venture depends on the competitors’ purpose
in forming it.
a. True
b. False
Notes and certificates of deposit are orders to pay money.
a. True
b. False
A promoter is a person who takes the preliminary steps to organize a corporation.
a. True
b. False
If the instrument is order paper, how can a person become a holder?
a. Transfer of its possession.
b. Its indorsement by the appropriate parties.
c. Both a transfer of its possessionand its indorsement by the appropriate partiesare
necessary.
d. None of these.
a. What are the two types of duress and what is the effect of each on the contract
involved?
b. Give an example of each type of duress.
c. Who does the law intend to protect by reason of the defense of duress? Why does the
law protect this type of person?
According to the UCC, an enforceable agreement involving the transfer of title of goods
from a seller to a buyer for a price is called a(n):
a. commercial contract.
b. express contract.
c. formal contract.
d. sale.