Fresh Harvest Company, which is based on Georgia, packages and sells vegetables.
Jack, who is a resident of North Carolina, buys a Fresh Harvest product, eats it, and
suffers severe food poisoning. Jack wants to file a suit against Fresh Harvest. The
diversity of citizenship between these parties means that
a. federal and state courts have concurrent jurisdiction.
b. federal courts have exclusive jurisdiction.
c. no court has jurisdiction.
d. state courts have exclusive jurisdiction.
Bill orders 1,000 nails from Super Hardware, Inc. Super Hardware keeps its nails in
packages of 100,000. Bill and the agent for Super Hardware both sign the contract for
the sale of the nails on Monday. The agent separates 1,000 nails on Wednesday. The
agent delivers the nails to Bill on Thursday morning, and Bill pays for the nails on
Friday. Identification of the nails took place on
a. Monday.
b. Wednesday.
c. Thursday.
d. Friday.
To resolve a dispute, Amy in Boston and Chris in Denver utilize E-Solution, an online
dispute resolution (ODR) service. This limits these partie’ recourse to the courts
a. not at all.
b. until the ODR service has issued a decision.
c. with respect to any dispute arising between them.
d. with respect to this dispute only.
Clancy sells shares in Darling Pool & Spa Company to Eton. Clancy does not deliver
the actual possession of the shares to Eton, but gives him the key to a safety-deposit box
in First State Bank in which the stock certificates are locked. Presenting the key is
a. real delivery.
b. constructive delivery.
c. delivery by agent .
d. no delivery.
Vehicle Leasing Agency (VLA) and Wander Trucking Company enter into a contract
for a lease of eight cargo vans. VLA delivers eight vans, but they are not cargo-sized.
Wander
a. cannot reject the entire shipment.
b. can reject the entire shipment.
c. must accept the entire shipment.
d. must reject the entire shipment.
Finance Bank receives a check drawn on the account of Get-Rich Industries, Inc., one
of the bank’s customers, at 3 p.m. Friday. Hildy, the presenter of the check, is not one of
the bank’s customers. The bank uses deferred posting with a 2 p.m. cutoff hour. If it
decides to dishonor the check, it must do so by midnight
a. Saturday.
b. Sunday.
c. Monday.
d. Tuesday.
Jacob owns five acres of land in northern California. On his land Jacob has a house and
a toolshed. There are ten large maple trees around the house that were there when Jacob
bought the land. Since buying the land, Jacob has planted an apple tree. Jacob’s real
property includes
a. the house and toolshed only.
b. the house only.
c. the house, toolshed and maple trees only.
d. the house, toolshed, maple tress and apple tree.
Rig Heli-Pads, Inc., enters into a contract to employ Scott as an on-site project manager
for two years. If Rig breaches the contract, Scott has a duty to
a. do nothing.
b. reduce the damages that Scott might otherwise suffer.
c. rescind the contract with Rig.
d. punish Rig and set an example to deter others from similar acts.
The Uniform Commercial Code has been adopted, at least in part, in
a. all states.
b. forty-five states.
c. thirty-five states.
d. no state.
Niche Stores, Inc., must hold a shareholder’ meeting
a. once a month.
b. once a year.
c. once every two years.
d. only when it is called by the board of directors.
Will is an agent for MaryElise. MaryElise gives Will clear instructions to only enter into
contracts on Mondays, Wednesdays, or Fridays. Will enters into a contract on
MaryElise’s behalf on Tuesday. Will has breached
a. the duty of performance.
b. the duty of loyalty.
c. no duty.
d. the duty of obedience.
Flo tells Ginger during a phone call that she will buy her textbook from last semester
for $65. Ginger agrees. These parties have
a. no contract.
b. an express contract.
c. an implied contract.
d. a quasi contract.
Drew and Earl are brothers. They agree to act as guarantors on a loan made by their
sister, Flo. Flo defaults on the payments and Drew refuses to pay. Earl pays the debt.
Earl can recover from
a. Drew and Flo under the right of proportionate liability.
b. Drew and Flo under the right of reimbursement.
c. Drew under the right of contribution and Flo under the right of subrogation.
d. no one, because the parties are brothers and sister.
Kitsch Niche Corporation is a noninvestment company that wants to issue $3 million of
stock in a twelve-month period. Kitsch Niche, with less than $20 million in annual
sales, qualifies as a small business issuer. Before Kitsch Niche sells the stock, it must
provide investors with
a. an offering circular.
b. a notice of the issue.
c. a red herring prospectus.
d. a tombstone ad.
Lebron, an attorney, allows a statute of limitations to lapse on a claim by Midwest
Metal Fabrication Company, a client. Lebron
a. can be held liable for malpractice.
b. has violated an ethical standard but cannot be held liable.
c. is subject to criminal penalties under the statute of limitations.
d. will be automatically disbarred.
Ben files a suit in a federal district court against Cathy. Cathy loses the suit, appeals to
the U.S. Court of Appeals for the Second Circuit, and loses again. Cathy asks the
United States Supreme Court to hear the case. The Court agrees to hear the case. This
means that
a. at least four justices approve of hearing the case.
b. Cathy’s petition does not raise a possibility of an important constitutional question.
c. the amount in controversy in Cathy’s suit is greater than $100,000.
d. the Court feels that the lower court’ judgments were erroneous.
Beth is a minor. She buys a set of sessions with a personal trainer, and a water bottle
and some weights from a fitness store. Later, Beth decides that she does not want the
water bottle or weights. In most states, Beth
a. can disaffirm the contract and return the water bottle and weights, but keep the
training sessions.
b. can only disaffirm the contract if she returns all the goods.
c. cannot disaffirm the contract.
d. can disaffirm the contract and keep all the goods.
Sparkling Gem Corporation agrees to sell Jewel Outlets, Inc. (JOI), fifty new diamonds,
but the contract does not specify a place of delivery. JOI is expected to pick up the
goods. The place of delivery is
a. Sparkling’s place of business.
b. JOI’s place of business.
c. the Annual Gems and Jewels Convention in New York City.
d. the U.S. Postal Service office nearest to JOI’s place of business.
GR8 Marketing Company and Brainfreeze Tunes, Inc., sign a document that states GR8
agrees to create a marketing campaign for Brainfreeze, which agrees to pay GR8 for the
service. GR8 and Brainfreeze have
a. an executed contract.
b. an express contract.
c. an implied contract.
d. a quasi contract.
Dom, an EZ Baked Goods salesperson, follows Flora, a salesperson for Goody Pastries,
Inc., as she attempts to make sales to food stores. Dom solicits each of Flora’s
customers. Dom is most likely liable for wrongful interference with a
a. bargaining relationship.
b. business relationship.
c. contractual relationship.
d. customer relationship.
Kenneth has a periodic tenancy that requires him to pay rent weekly. Kenneth wishes to
terminate his tenancy. Under the common law, he must give his landlord
a. at least one week’s notice.
b. at least two week’ notice.
c. at least thirty day’ notice.
d. at least sixty day’ notice.
Wiley incorporates his business as Wiley Wire Corporation in Texas. He and his group
of shareholders intend to make a profit from their sales of fencing wire. Wiley Wire
Corporation is
a. a nonprofit corporation.
b. not a corporation.
c. an alien corporation.
d. a private corporation.
A common ethical dilemma faced by the management of Spencer Hydraulics
Corporation involves the effect that its decision will have on
a. one group as opposed to another.
b. the firm’s competitors.
c. the government.
d. the U.S. Chamber of Commerce.
Plato works for Quirky Squirters, Inc. During work hours, Plato ‘steals” time, space, and
data on his employer’s computer system to start up his own business, Rowdy Drenchers.
This is
a. burglary.
b. robbery.
c. larceny.
d. no crime.
Jordana is a member of Klondike Coffee, LLC, a limited liability company. Jordana is
liable for Klondike’s debts
a. in proportion to the total number of members.
b. to the extent of his capital contribution.
c. to the extent that the other members do not pay the debts.
d. to the full extent.
Jon, a law enforcement official, monitors Kelsey’s Internet activities’e-mail and Web
site visits’to gain access to her personal financial data and student information. This
may violate Kelsey’s right to
a. equal protection of the law.
b. privacy.
c. procedural due process.
d. substantive due process.
Echo enters into an agreement with Deep Pan Pies, Inc., to operate a franchise in Centre
City. Later, Deep grants franchises to others within the city. Echo files a suit to close
them. If the court rules in Echo’s favor it will most likely be on the ground that
a. Deep violated the antitrust laws.
b. Deep violated the implied covenant of good faith and fair dealing.
c. Echo paid a franchise fee.
d. Echo was the first Deep franchisee in Centre City.
Hadley, an accountant, accumulates working papers while performing an audit for Ilene.
After the audit, these documents belong to
a. Hadley, with Ilene having a right of access to the papers.
b. Ilene, with Hadley having a right of access to the papers.
c. neither Hadley nor Ilenethe papers must be disposed of.
d. the Public Company Accounting Oversight Board.
Bayou Boats, Inc., contracts for the sale of seven swamp boats to Eventide Fishing
Tours. Bayou repudiates the contract. Eventide’s recovery is measured at the time
a. Bayou advertised the goods.
b. Eventide ordered the goods.
c. Eventide learned of the breach.
d. Bayou knew that it would repudiate the contract.
Fact Pattern 14-1
Bella Homes enters into a contract to buy 132 acres from Watershed Holdings to
subdivide and sell in fifth-acre lots for Pristine Meadow, a residential development.
Refer to Fact Pattern 14-1. If Watershed breaches the contract, Bella’s remedy would
most likely be
a. a certain ratio of the amount that Watershed has in liquidated funds.
b. a percentage of Watershed’s unrealized profit.
c. the difference between the land’s contract and market prices.
d. specific performance.
Venture Capital, LP, is a limited partnership. Its limited partners include more than 150
sophisticated investors and investment professionals. A Venture limited partner loses his
or her limited liability if he or she
a. acts as the firm’s manager.
b. does not participate in the firm’s management.
c. invests in Unified Fund, one of Venture’s competitors.
d. votes on the firm’s sale or dissolution.
In making a decision as chief executive officer of Straightarrow Archery Supplies,
Robin always considers whether he would feel any guilt about a particular action. As a
guide, Robin is using
a. the categorical imperative.
b. internal company policies.
c. the law.
d. his conscience.
Eli, a minor, buys an automobile insurance policy from Faithful Insurance Company
and pays a $1,000 premium. If Eli can disaffirm the contract, he can most likely recover
a. $500.
b. $1,000.
c. $1,500.
d. nothing.
Generally, a foreign government cannot sue under U.S. antitrust laws in U.S. courts.
On a motion for judgment on the pleadings, a court may consider evidence outside the
pleadings.
ADR proceedings are always strictly regulated by federal statutes.
Americans with a Better Cause (ABC), a nonprofit organization, files a suit against the
U.S. Department of Justice (DOJ), claiming that a certain federal statute the DOJ is
empowered to enforce conflicts with the U.S. Constitution and with a state constitution.
In each situation, which source of law has priority?
Lenders are required to charge prepayment penalties on most subprime mortgages and
home equity loans.
Criminal law focuses on duties that exist between persons.
Quorum requirements are the same in all jurisdictions.
Ellen contracts to buy six cases of vintage Fertile Valley wine from Grapes & Vines
Winery for $1,200. The contract states that delivery is to be made at Ellen’s residence
“on or before May 1, to be used for daughter’s wedding reception on May ” On May 1,
Grapes & Vines’s delivery van is involved in an accident, no wine is delivered that day,
and no one from Grapes & Vines tells Ellen. On the morning of May 2, Ellen buys the
wine from Happy Hill Winery. That afternoon, just before the reception, Grapes &
Vines tenders delivery of the wine at Ellen’s residence. She refuses tender. Grapes &
Vines sues her for breach of contract. How is the court most likely to rule?
Corporate governance can be defined as the relationship between a corporation and its
directors.
If goods identified to a contract are destroyed through no fault of either party, both
parties are excused from performance.
The key federal statute regulating the credit and credit-card industries is basically a
disclosure law.
Any relevant material, except information stored electronically, can be the object of a
discovery request.
A motion for a directed verdict is also known as a motion for judgment as a matter of
law.
One purpose of criminal sanctions is to deter others from committing similar crimes in
the future.
Constructive delivery satisfies the delivery requirement for an effective bailment.
A syndicate may exist in the form of a partnership but not a corporation.
Business ethics is not more complicated than personal ethics.
Bubbly Bottling Company is engaged in the soft-drink bottling and distribution industry
in the states of New York and New Jersey. The firm currently has about 40 percent of
the market for these products and related services. Carbonate Distribution Corporation
competes with Bubbly in the same states. Carbonate has about 35 percent of the market.
If Bubbly were to acquire the stock and assets of Carbonate, would Bubbly be in
violation of any of the antitrust laws? If so, which one? Discuss fully.
An accountant normally will be held liable to the client for incorrect judgment.
Personal defenses are used to avoid payment to an ordinary holder of a negotiable
instrument, but not to an HDC or a holder through an HDC.