Through a certain transaction, Coffee Bean Cafs, Inc., acquires all of the shares of Deli
Dining Corporation for some of Coffee Bean’s shares. Both Coffee Bean and Deli
Dining continue to exist. This is
a. a consolidation.
b. a share exchange.
c. a short-form merger.
d. a purchase of assets.
Northeast Bank makes mortgage loans to consumers, including Mai, to buy homes.
Under federal law, disclosures with respect to one of Northeast’s loans must be provided
a. a certain number of days after the loan is finalized.
b. a certain number of days before the loan is finalized.
c. at the same time at which the loan is finalized.
d. at whatever time is most rational and appropriate.
Sweetwater Caf defaults on debts to Town & Country Bank and Uno Loan Company.
Town & Country perfected its security interest before Uno. Town & Country takes
possession of the collateral in which it has a security interest. On a sale of the collateral,
the proceeds will be applied first to
a. Sweetwater’s previous payments on the debts.
b. Sweetwater’s unpaid payments on the debts.
c. the balance of Sweetwater’s debt to Town & Country.
d. the balance of Sweetwater’s debt to Uno.
Ted and Svetlana orally agree to several different oral contracts. The Statute of Frauds
will bar enforcement of an oral contract for
a. a deal that will be performed within a year.
b. a primary obligation.
c. a sale of goods for $100.
d. a sale of land.
David, an Alabama resident, files a suit in an Alabama court against QuickAds, an
Internet company based in Georgia that provides advertising services. QuickAds only
contact with persons in Alabama has been through QuickAds’s passive advertising. The
Alabama court is
a. likely to have jurisdiction over the case.
b. not likely to have jurisdiction over the case.
c. likely to refer the case to a higher district court.
d. likely to refer the case to an appellate court.
Josh is a director of Sippy Soups, Inc. Josh opposes a tender offer that is in Sippy’s best
interest because its acceptance would cost him his position as a director. Josh is liable
for a breach of duty of
a. no duty or rule.
b. the business judgment rule.
c. the duty of care.
d. the duty of loyalty.
Jim files a uniform financing statement giving notice to the public that he has a secured
interest in collateral belonging to Phil, who is the debtor named in the statement. This
uniform statement form is now used in
a. all states.
b. no states.
c. only one statePennsylvania.
d. some states with several different forms used in other states.
Karen writes on a piece of paper, “I owe you $600,” signs it, and gives it to Lou. This
instrument is
a. negotiable.
b. nonnegotiable, because it does not include an express promise to pay.
c. nonnegotiable, because it does not recite any consideration.
d. nonnegotiable, because it does not state any conditions to payment.
A-1 Furnishings, Inc., agrees to lease a desk to Business Resources, Inc. (BRI), which
requests that the desk be left outside City Warehouse for BRI to pick up. Before BRI
retrieves the desk, it is stolen. The loss is suffered by
a. A-1 Furnishings and BRI, but not City Warehouse.
b. A-1 Furnishings, BRI, and City Warehouse.
c. A-1 Furnishings only.
d. BRI only.
On Monday, Michelle deposits in her account at Fiscal Bank a local check for $500.
After 5:00 p.m. on Friday, from these funds, Michelle can withdraw no more than
a. $100.
b. $400.
c. $500.
d. $600.
Edna and Flavia buy a boat that they dock in a marina near Gulfport, Mississippi. On
the death of either owner, that owner’s interest in the boat passes to her heirs. This is
a. a joint tenancy.
b. community property.
c. a tenancy in common.
d. ownership in fee simple.
Forrest makes and sells furniture. Forrest and Glenda enter into a contract for the
delivery of Forrest ‘s products to Glenda’s Gear retail locations for which she agrees to
pay the invoiced price. Forrest transfers the right to payment under the contract to
Haulers Trucks & Trailers. This transfer is
a. a delegation.
b. an assignment.
c. a third party beneficiary contract.
d. prohibited.
Great Gates, Inc. has a board of ten directors. Great Gates’ bylaws do not state any
quorum requirements. In most states, a quorum for Great Gates will be defined as
a. two directors.
b. six directors.
c. nine directors.
d. ten directors.
Valerie is a pilot for Wayfarer Airlines. Wayfarer’s policy is to restrict Valerie and its
other pilots from flight responsibilities after a certain age. This is most likely
a. a legitimate bona fide occupational qualification.
b. discrimination on the basis of age.
c. reverse discrimination.
d. discrimination on the basis of disability.
Bobby has fifteen creditors. To force Bobby into bankruptcy proceedings, at least three
creditors must join the petition and their unsecured claims must add up to at least
a. $500.
b. $10,250.
c. $14,425.
d. $50,000.
Fruits & Vegetables, Inc., employs hundreds of seasonal and permanent workers, both
skilled and unskilled, in seven states. Fruits & Vegetables can hire illegal immigrants
a. if either the employer or the immigrants file special forms.
b. only if the employer files a special form.
c. only if the immigrants file special forms.
d. under no circumstances.
Tyro has the right to drive across Ula’s land, which is next to Tyro’s property, to reach
an access road. Tyro’s right is
a. an easement appurtenant.
b. an easement in gross.
c. a profit appurtenant.
d. a profit in gross.
Thermo Gas, Inc., and Uno Oil Corporation refine and sell gasoline and other
petroleum products. To limit the supply of gas on the market and thereby raise prices,
Thermo Gas and Uno Oil agree to buy “excess” supplies from dealers and “dispose” of
it. This is
a. a deal that neither restrains trade or harms competition.
b. a legal restraint of trade.
c. a per se violation of the Sherman Act.
d. subject to analysis under the rule of reason.
The Merit Systems Protection Board issues a rule. Like other administrative agencies’
“legislative rules,” this rule is as
a. binding as a law passed by Congress.
b. persuasive as an expert’s opinion.
c. suggestive as a newspaper’s editorial.
d. unenforceable as a salesperson’s puffery.
Quik Collection Agency calls Pat several times a day, and sometimes in the middle of
the night, about an overdue bill that Regal Sporting Goods turned over to Quik for
collection. This is a violation of
a. no federal law.
b. the Fair and Accurate Credit Transactions Act.
c. the Fair Debt Collection Practices Act.
d. the Truth-in-Lending Act.
Nika owns land in Ohio. Her ownership rights include the right to sell or give away the
property without restriction, and the right to commit waste, if she chooses.
Nika deeds some of her land to Polly. The deed states, “To Polly, for life, then to Quay.”
Nika has given Polly
a. a fee simple absolute.
b. a leasehold estate.
c. a life estate.
d. an easement.
Cardio, Inc., makes and sells Drawdown, the most prescribed name-brand heart
medication. Emitate Corporation has the potential to make a generic version of the
same drug.
Cardio pays Emitate not to sell its product. This is
a. a customer restriction.
b. a joint venture.
c. an exclusive-dealing contract.
d. a price-fixing agreement.
Larry is a shareholder for Custom Colors, Inc. If Custom Colors fails, Larry will
a. be liable for Custom Colors’ debts.
b. not be liable for Custom Colors’ debts.
c. be able to reclaim his initial investment in Custom Colors.
d. be able to reclaim his initial investment in Custom Colors plus damages.
Four-Square Construction Company enters into a contract with Ben to remodel Carol’s
Home Store, using products from Delta Building Supplies. Eatery Caf is next to Carol’s
Home Store. The remodeling is a gift from Ben to Carol.
The value of Eatery’s property will increase after Carol’s store is remodeled. Eatery is
a. a delegatee.
b. an assignee.
c. an incidental beneficiary.
d. an intended beneficiary.
Mineral Mining Corporation is a U.S. employer. Mineral, and other U.S. employers,
must perform I-9 verifications for
a. a random selection of new hires.
b. every other new hire.
c. new hires with certain racial or ethnic characteristics.
d. each new hire.
Amelia executes a separate written instrument to amend her prior will. This separate
document is
a. a codicil.
b. a holographic will.
c. a living will.
d. a nuncupative will.
Jack buys a Kitchens, Inc., franchise, which the franchisor later terminates. In
determining whether the termination was proper, a court will generally
a. balance the rights of both parties.
b. emphasize the right of Kitchens, Inc., to its business operation.
c. focus on the right of Jack to be dealt with fairly.
d. underscore the interest of consumers in affordability.
Gina sells “Bulk Up” steroids over the Internet. She is arrested and charged with the
sale of a controlled substance. This is cyber crime, which is
a. a new category of crime that is not related to older types of crime.
b. a crime that occurs the virtual community of the Internet.
c. a crime that is less real than the same crime in the physical world.
d. no crime.
The best definition of a precedent is
a. a law developed from custom.
b. a judicial proceeding for the determination of a dispute between parties in which
rights are enforced or protected.
c. a proceeding by one person against another in court.
d. a court decision that furnishes an example or authority for deciding subsequent cases
involving identical or similar facts.
Clara is a salesperson in The Corner Store. When Carla makes a sale to Jenny, the sale
is
a. binding on The Corner Store.
b. binding on Carla.
c. binding on The Corner Store only if the owner of The Corner Store is present when
the sale is made.
d. not binding on anyone.
Quinn is an employee of Regional Industries, Inc. Quinn is threatened with a discharge
when he refuses a transfer to a Regional department in which several employees
suffered serious injuries from exposure to hazardous chemicals. Quinn may be entitled
to protection from discharge under
a. no law.
b. the Family and Medical Leave Act.
c. the Occupational Safety and Health Act.
d. the state workers’ compensation act.
Luminescent Silicon Corporation, which controls 40 percent of the computer-chip
market in the United States, merges with Micro Processors, Inc., which controls 15
percent of the same market. This merger is a violation
a. only if the result more clearly concentrates the market.
b. only if the result makes it more difficult for potential competitors to enter the market.
c. if the result more clearly concentrates the market and makes it more difficult for
potential competitors to enter the market.
d. under no circumstances.
Rolling Transport & Storage Corporation wants to insure its warehouse to obtain the
maximum possible recovery for the lowest possible premium. To obtain the maximum
recovery under a coinsurance clause, the percentage of the value of the property that
should be insured is
a. 80 percent.
b. 90 percent.
c. 100 percent.
d. 120 percent.
An attorney may be liable in negligence to any third party who the attorney knows will
rely on the attorney’s work.
In most cases, a corporation’s common stockholders need to approve a merger.
If the meaning of a statute’s language is unclear and an agency interprets it, a court must
overturn the interpretation.
A party seeking to recover compensatory damages cannot also recover incidental
damages.
A surety is primarily liable for the debt of a principal.
A promise to give value in the future is sufficient to confer the rights of an HDC on one
in possession of a negotiable instrument.
A franchise agreement may specify that the premises for the business must be leased.
To execute a valid will, a testator must remember the “natural objects of his or her
bounty.”
A plaintiff alleging wage discrimination must file a complaint within a certain period of
time of the decision that set the discriminatory pay.
The privacy rights of private-sector employees are governed by state law, which varies
widely.
Whether financial statements created by an accountant need to be verified for accuracy
is not a legal question.
Under the UCC, parties to sales and lease contracts are not free to establish whatever
terms they wish.
A release bars any further recovery beyond the terms stated in the release.
The TRIPS agreement covers computer programs.
A free-writing prospectus may be used before the Securities and Exchange Commission
completes its review of a related registration statement.
To use attachment as a remedy, a creditor must have an enforceable right to payment of
the debt.
Shippers Dispatch Corporation orders office equipment from Office Outfitters, Inc.,
which has an unperfected security interest in the equipment until it is paid for.
Meanwhile, Shippers Dispatch takes out a loan from Capital Credit, Inc., subject to a
security interest in Shippers Dispatch’s building and equipment, which Capital perfects.
Shippers Dispatch files a bankruptcy petition under Chapter 7. If the petition is granted,
in what order will Shippers Dispatch’s creditors be paid?
To resist a takeover, a target company can make a self-tender.
All unemployed workers who are willing and able to work are eligible for
unemployment compensation.