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Molly and Craig are the original parties to a contract. Craig is obligated to design a
Website for Molly. They subsequently make an agreement with Eric that Eric should
take the place of Craig and assume all of Craig's rights and duties under the contract.
The agreement releases Craig from his obligations under the contract. This agreement
is:
a. a novation.
b. an accord and satisfaction.
c. an assignment.
d. a nullification.
Mega Corp is negotiating a collective bargaining agreement with a union. The company
claims it is not financially able to pay the wage increase the union is demanding. Which
statement is correct?
a. The union has a legal right to inspect the financial records of the company to verify
that the employer cannot pay the proposed wage increase.
b. It is an unfair labor practice if the employer claims it cannot pay the higher wages but
refuses to allow the union to inspect its financial records.
c. Both of the above are correct.
d. None of the above.
Liability insurance would cover:
a. injuries sustained in a fight on your property
b. damage done by a drunk driver
c. intentional poisoning committed on your property
d. an injury to a guest on your property caused by a tree limb falling on them
Betty's BBQ orally contracts with Denny's Design House for 10,000 matchbooks at the
price of 10 cents per matchbook. The matchbooks are to be embossed with a logo to be
designed by Denny's Design promoting Betty's BBQ. Price, payment terms, delivery
terms are agreed upon between the parties. Denny's Design creates the logo, gets Betty's
BBQ's approval of the design and begins applying the logo on the matchbook covers.
Denny's Design has almost finished the order when Betty's BBQ calls to say it has
decided to make the eatery a smoke-free restaurant and cancels the order. Denny's
Design sues, but Betty's BBQ states that the agreement is unenforceable under the
statute of frauds. Who wins?
a. Denny's Design House wins. This situation falls under an exception to the statute of
frauds.
b. Denny's Design House wins. This is a service contract for design of a logo.
Therefore, the UCC, including the statute of frauds provisions of Article 2, does not
apply.
c. Betty's BBQ wins. This is a contract for $1000. The statute of frauds requires all sales
contracts in excess of $500 be in writing.
d. Betty's BBQ wins. The statute of frauds only applies to merchants. Betty's BBQ is
not a merchant in this instance because it intended to give the matchbooks away and not
sell them.
Circus Pizza contracted with Art to run its birthday parties. Art's responsibilities
included supervising the children and organizing the games. Circus did not investigate
Art's background, which included a history of assaulting children. Art assaulted a
7-year-old girl in the restaurant's kitchen during a birthday party. Circus Pizza:
a. cannot be liable for the damages because Art committed an unforeseeable intentional
tort.
b. cannot be held liable for the damages because Art's conduct was not in the scope of
employment.
c. may be held liable on the basis of negligent hiring.
d. may be held liable only if Circus actually knew of Art's background.
Which of the following is NOT one of the three ways to amend a written contract?
a. write and sign an amendment document.
b. verbally agreeing to the changes and shaking hands on the deal.
c. crossing out the mistakes and writing in the corrections.
d. writing a totally new contract with the correct provisions.
Ted and Janet were married and owned a piece of jungle property in a joint tenancy.
When Janet died, her will left of all her real property to T.J., their adult son. T.J. claims
he is the sole owner of the jungle property. Ted objects and files a lawsuit for sole
ownership of the jungle property.
a. Ted will win because property owned in a joint tenancy which includes rights of
survivorship for the surviving spouse. Ted will get the title to the entire property.
b. Ted will win only a one-half interest in the jungle property. T.J. will own the other
one-half interest because Janet had the right to will her half of the property to anyone
she chose.
c. Ted will lose and forfeit his entire interest in the whole property because a joint
tenancy means that one party owns only part of the property.
d. None of these answers are correct
Betsy's elderly father gave her written authority her to sell the family house. Her father
lived in Arizona and she lived in Minnesota. After about two months she found a buyer
for the house and signed an acceptance of the offer on March 21. Later that same day
she learned her father had died the day before (March 20). Other members of the family
did not want the family house sold and claimed that the acceptance Betsy signed was
void. The buyer of the house claims Betsy had the legal authority to sell the house and
that the contract is binding. Who is right?
Dersett Trucking hauls granite for the major granite companies in Minnesota. Dersett
Trucking does not make its trucking services available to the general public. Dersett
Trucking is a contract carrier and does not incur strict liability.
Wally owns 200 acres of land. Wally offers to sell the land to Robert for $1,500 per
acre. Robert replies that he does not need 200 acres of land but would like to buy 40
acres at $1,500 per acre. Wally agrees to sell but does not identify which 40 acres.
Later, Wally refuses to sell any land to Robert. What is the result?
a. Robert wins; this is an enforceable contract with complete and definite terms.
b. Robert wins; the UCC will decide which 40 acres are to be sold.
c. Wally wins; the original offer was not intended to be an offer but merely an invitation
to negotiate.
d. Wally wins; this agreement is too indefinite since it does not identify which 40 acres
are to be sold.
Ethical companies:
a. tend to earn higher returns than companies that engage in wrong-doing.
b. tend to have more creative employees than companies that engage in wrong-doing.
c. are guaranteed to be more profitable in the long run than companies that engage in
wrong-doing.
d. All of the above..
e. Both (a) and (b).
When an appeal is filed with the U.S. Supreme Court, the Supreme Court:
a. must hear the case if the validity of a federal statute is in question.
b. must hear the case if two or more U.S. courts of appeals have decided the legal issue
differently.
c. has discretion as to which cases it hears.
d. must hear all cases.
A policy that makes payments to the owner monthly for her entire life is called:
a. whole life insurance
b. universal life insurance
c. an annuity
d. disability insurance
A Chapter 7 debtor's agreement to pay a creditor on a debt after receiving a discharge in
bankruptcy is called a:
a. voidable preference.
b. reaffirmation.
c. fresh start.
d. redemption.
Victoria registered a trademark under the Lanham Act. Six years later Don noticed
Victoria's trademark and filed a lawsuit to enjoin her from using it. He proved he had
registered the mark in several states more than ten years before Victoria obtained her
trademark. Will Don prevail?
a. Yes. Don did not have to register the trademark to enforce it.
b. Federal law specifically states a federal trademark is not valid for any lawful owner
of the same mark under state law.
c. No. Don will not prevail and Victoria can continue to use the mark.
d. None of the above.
Antoine makes a check out to cash and delivers it to Barley. What is it?
a. A promissory note
b. A check
c. Bearer paper
d. Order paper.
E-trex, Inc. wanted Prince, a professional basketball player, to endorse its products.
Prince, however, was not interested. E-trex was not deterred and hired a person who
looked and sounded liked Prince for its commercials.
a. E-trex has defamed Prince.
b. E-trex has interfered with a contract.
c. E-trex has interfered with a prospective advantage.
d. E-trex's conduct raises the issue of commercial exploitation.
The doctrine of stare decisis:
a. makes the legal process more expensive.
b. is an equitable remedy.
c. makes the law more predictable.
d. is unimportant to the common law.
Which of the following does a defendant have to do in person?
a. Interrogatories
b. Subpoena
c. Production
d. Deposition
The movers have to bring the piano in through the open window on the third floor. The
rope breaks and falls on Carmens car. Under what theory can she recover damages.
a. assumption of risk
b. strict liability
c. res ipsa loquitur
d. negligence per se
Myron had two children, Cheryl and Pete, who predeceased him. Cheryl had three
children and Pete had one child. Myron died testate. Which of the following is true?
a. If Myron's will indicates that the issue are to inherit per stirpes, Pete's child will
receive one half of Myron's estate.
b. If Myron's will indicates that the issue are to inherit per stirpes, Pete's child will
receive one fourth of Myron's estate.
c. If Myron's will indicates that the issue are to inherit per capita, Pete's child will
receive one half of Myron's estate.
d. If Myron's will indicates the issue are to inherit per capita, each of Cheryl's children
will receive one sixth of Myron's estate.
Megan was employed by a large company. Her supervisor told her to falsify
government reports. She refused and was fired. She sued for wrongful discharge. Her
employer claimed that, since Megan was an at-will employee, she had no legal right to
claim the company was liable for damages. Is the employer right?
a. Yes. An at-will employee does not have a legal right to claim wrongful discharge of
employment.
b. Yes. As an employee, Megan owes a duty of loyalty to her employer. If the company
was found to have acted illegally by falsifying the reports, it (not Megan) would be
liable.
c. No. Even though Megan was an at-will employee, such employees may not be fired
without just cause.
d. No. Though at-will employees do not have extensive rights relative to job security,
they may not be legally fired for refusing to perform an illegal act.
Angela sued Tom for battery. Angela was awarded $30,000 for future medical expenses.
Five years after the award, Angela realizes that her medical expenses will far exceed
$30,000. Under the single recovery principle:
a. Angela will be able to submit the additional medical bills to the court for payment.
b. Tom will have to pay the additional medical bills.
c. Tom will have a qualified privilege and only have to pay a portion of the additional
medical expenses.
d. Angela will have no recourse against Tom or the court for the medical expenses as
long as the original award was reasonable.
What are the duties of the secured party when it is disposing of collateral upon a
default.
a. sell the collateral in a public sale only.
b. dispose of the collateral in any reasonably manner
c. no duty of further notice to the defaulting debtor.
d. all of the above
Which of the following is correct?
a. A copyright can be renewed once it expires.
b. A patent can be renewed once it expires.
c. A trademark can be renewed as long as the mark is still in use.
d. None of the above.
Which of the following is an example of a purchase money security interest in
consumer goods?
a. A doctor purchasing a computer on credit to create a Webpage to make services and
information available to her patients.
b. A doctor purchasing on credit a blood glucose monitor to check his own blood sugar
levels.
c. A doctor purchasing a TV/VCR unit on credit to place in her office waiting room.
d. A doctor purchasing an exercise bike for his employees to use over the lunch hour.
A jury decision in a civil case:
a. must be unanimous.
b. must be reached in the same day the case is heard.
c. depends on whether or not the parties have agreed to have their case decided by less
than a unanimous verdict.
d. is achieved by informal deliberations.
If in 1900 the Minnesota Supreme Court ruled that a minor can void a contract at any
time during minority and in 2008 the courts in Minnesota still follow this ruling, this is
an example of:
a. stare decisis.
b. the bystander rule.
c. statutory law.
d. enabling legislation.
Daniel, his parents, and three brothers own all the stock of their family farm
corporation. This corporation, which is taxed as a corporation, is probably:
a. an S corporation.
b. a C corporation.
c. a closely held corporation.
d. an LLC.
A rock group assigns its payment under a performance contract to the Costume Shop, a
business that has supplied the group with outrageous stage outfits, and to which the
group owes a great sum of money. Under this arrangement the rock group is the:
a. assignor.
b. assignee.
c. delegator.
d. delegatee.
Which of the following is a valid defense to a defamation claim?
a. The statement was true.
b. The statement was only an opinion.
c. The person making the statement made it only to the plaintiff, not to any third parties.
d. All of the above.
Standard provisions in a contract that are often listed under the heading "Miscellaneous
are called:
a. boilerroom.
b. boilerplate.
c. boilerpot.
d. boilerplate.
Charlie Sheens drug use and violent behavior:
a. were bad enough that to warrant CBSs firing of him from a hit TV show.
b. have no impact on his job as an actor.
c. enhance his reputation as a "tough guy and should be tolerated.
d. are false accusations.
The Jesperson v. Harrahs case involved the issue:
a. Whether female bartenders could be force to work only in the restaurant area behind
the scenes when they were pregnant.
b. Whether female employees could be forced to wear makeup while working.
c. Could be forced to change jobs to cocktail waitress when the image of the club was
changed.
d. Could wear her body piercing at work.
Briefly discuss the enforceability of contracts by third parties.
Karen has filed for bankruptcy. Who has the authority to confirm or reject a plan of
payment, and what factors will be considered when deciding whether to approve a
repayment plan under Chapter 13?
Wilmas arm is broken when Paula knocks her down during an argument. If Wilma sues
Paula for battery, what damages is Wilma likely to receive?
A consumer credit contract is one between two consumers to buy and sell goods.
Brad was having financial difficulties and thought bankruptcy might be in his future. He
transferred his sports car to his brother with the agreement that if he didnt file for
bankruptcy within the next 18 months, his brother would return the car to him. Brad did
file for bankruptcy in ten months. The bankruptcy trustee can bring the car back into
Brads estate for the purpose of providing assets for Brads creditors.
Probate refers to the process of carrying out the terms of a will.
Mislaid property is distinguished from lost property by the intent of the true owner.
Management is entitled to tell the employees that it is opposed to a union and why.
Taking a personal property without paying for it is a common type of larceny.
The Sixth Amendment declares that a person cannot be tried twice for the same
criminal offense.
A party does not need to register a deed or take other legal steps, but he can act as
though he is the sole owner to adversely possess a property.
Per se violations are subject to both civil and criminal penalties.
Under the Electronic Communications Privacy Act an employer may under certain
conditions monitor employees telephone calls and email messages.
Congress revised and reauthorized the Patriot Act, but the secret national security letter
provisions were later limited by a federal appeals court.
The federal government has preempted the field of online privacy, so states may not
pass their own online privacy statutes.
An employer may not disqualify a job applicant because of a disability if they can
perform the essential functions of the job with reasonable accommodation.
Lian contracted for financial services from E-wise. This contract is governed by Article
2 of the UCC.
Richard received his credit card bill and noticed an error. He wrote to the company the
next week, pointing out the error in his bill. Under the law, what is the credit card's
obligation once it receives Richard's letter?
