Which of the following are generally considered to be legal offers?
a. placing an item up for auction
b. catalog advertisements
c. price lists
d. a note scribbled on a restaurant napkin that includes the details of the offer
Nevada passed a law banning all commercial billboards along state highways to
improve the appearance of the environment. If this law were to be challenged, which of
the following would a court examine to determine if the law is constitutional?
a. It would have to be established that the law furthers an interest of the state of Nevada
to create a more aesthetically pleasing environment.
b. It would have to be shown that the law directly and materially advances the state’s
goal of a more aesthetically pleasing environment.
c. It would have to be shown that the law reaches no further than necessary to promote
the state goal.
d. All of the above.
A plaintiff sues in negligence but has no direct proof that the defendant behaved
unreasonably. Which of the following is most likely to help the plaintiff?
a. Res judicata
b. Stare decisis
c. Res ipsa loquitur
d. Mens rea
A manager who has engaged in self-dealing has violated the duty of loyalty to the
corporation, unless the self-dealing was entirely fair to the corporation.
a. True
b. False
Your co-worker, Bill, comes into the office and tells you that he is going to play
“hooky” and go golfing believing that the boss will think he is out calling on clients.
When your boss comes in, he asks you where Bill is and you reply “I saw him in the
office earlier this morning, but I haven’t seen him lately.” What would Kant call this
misleading statement?
a. a palter
b. a categorical imperative
c. a veil of ignorance
d. an ethical omission
Contemporary laws principle of collective responsibility, such as all partners being
personally responsible for the debts of the partnership, had its roots in the
a. Anglo-Saxon method of ensuring public order through tithing.
b. Anglo-Saxon practice of using “oath helpers.
c. English use of ‘shire reeves.
d. English system of feudalism.
The Supreme Court in the Teresa Harris v. Forklift Systems, Inc. case held that
a. for there to be sexual harassment, the conduct must affect an employee’s
psychological well-being.
b. conduct need not affect an employee’s psychological well-being to constitute sexual
harassment.
c. Title VII does not apply to sexual harassment cases.
d. Title VII does not apply to same-sex harassment.
Overall, directors get paid very little for the amount of work they perform.
a. True
b. False
If Rudy offers Oscar $200 for his laptop valued at $600 and Oscar agrees, a court will
probably
a. set aside the agreement as being unfair.
b. set aside the agreement because the consideration is inadequate.
c. not set aside the agreement based on the adequacy of the consideration.
d. not set aside the agreement because of the UCC.
To be valid, an agreement not to compete must be ancillary to a legitimate bargain.
a. True
b. False
Which of the following acts resulting in injury would be negligence per se?
a. Joe sold fireworks from his Indiana store (a legal activity) to Steve, an Illinois
resident (a state that has made owning fireworks illegal).
b. June,while driving the speed limit, sideswiped the car next to her.
c. A retailer sold glue containing benzene to a 14-year-old boy in violation of state law.
d. Tammy accidentally dropped a heavy carton on Sasha’s foot while at work.
A corporation must have a registered agent within the state of incorporation only if the
corporation maintains an office in that state.
a. True
b. False
The requirements for a patent include all of the following EXCEPT
a. the invention must be novel.
b. the invention must be nonobvious.
c. the invention must be commercially valuable.
d. the invention must be useful.
At least once every three years, companies must take a nonbinding shareholder vote on
the compensation of the five highest-paid executives. This is referred to as
a. clawback pay action.
b. voting out the directors.
c. activist investing.
d. say-on-pay.
A form of due process that holds that certain rights are so fundamental that the
government may not eliminate them is referred to as
a. procedural due process.
b. judicial restraint.
c. substantive due process.
d. eminent domain.
In which of the following cases will the federal accountant-client privilege protect the
information from being disclosed?
a. A criminal case
b. A case involving the SEC
c. A case concerning the preparation of tax returns
d. A civil case involving the IRS
To recover for an alleged violation of SEC Rule 10(b)-5, a plaintiff is required to prove
reliance on a misstatement or omission relative to the purchase of the security.
a. True
b. False
The case calledKuehn v. Pub Zonewould reveal that Kuehn is the plaintiff, since the
plaintiff is always listed first.
a. True
b. False
While shopping at the mall, Everett’s wallet fell out of his pocket. Jon found the wallet.
The wallet is abandoned property and Jon may keep it.
a. True
b. False
Landscaper Lottie used her machinery, employee labor, and her expertise to landscape
Opal’s new guest home. Opal fails to pay for the landscaping because she has run out of
money. Lottie files a lien against the real property. This lien is called
a. an artisan’s lien; her landscape design is a work of art.
b. a landlord’s lien; Opal is planning to rent the guest house to a tenant.
c. a mechanic’s lien; it was created by improving real property.
d. a purchase money security interest.
Under the Uniform Anatomical Gift Act,
a. an individual may indicate the desire to be an organ donor by putting a provision in
his will. The provision will take effect after probate of the will.
b. the willingness to be an organ donor may be indicated by signing an organ donation
card in the presence of one disinterested witness.
c. family members of a decedent have no right to make a gift of the decedents organs if
the decedent did not make an affirmative indication of the desire to be a donor during
her lifetime.
d. an effective donation may be made by an individual in a will or on a witnessed
organ-donation card or by family members after the persons death as long as the person
did not indicate a desire not to be a donor.
Marco agrees to sell Clowns R Us some balloons. The contract states that Clowns may
buy as many balloons as it wishes. This agreement is
a. a requirements contract.
b. an output contract.
c. an illusory contract.
d. an enforceable contract.
The Employee Retirement Income Security Act (ERISA) requires employers to
establish pension plans for employees.
a. True
b. False
Chapter 7 bankruptcy petitions may only be filed voluntarily.
a. True
b. False
The U.S. Supreme Courts holding in Wards Cove Packing v. Atonio
a. differed from the holding in Griggs v. Duke Power Co. partly because the Court was
more conservative at the time Wards Cove was decided.
b. upheld the ruling in Griggs v. Duke Power Co.
c. found that overt racial discrimination existed.
d. set forth a “business necessity requirement for employment hiring practices.
The percentage of a decendent’s estate that a spouse can claim is called a forced share.
a. True
b. False
When Shoes International went out of business after some serious and unethical
accounting errors, its accounting company also closed its doors. 123Jump, a French
company, was concerned that the unethical behaviors that occurred were an American
problem, so it cancelled its business with another American accounting company and
used a French one instead. Who was harmed by Shoes International’s unethical
behavior?
a. only Shoes International
b. only Shoes International and the accounting firm it used
c. Shoes International, the accounting industry and the United States
d. only 123Jump
Vicki entered into a written contract to buy a car from Valley Motors. During the
negotiations, the sales representative said that the car had a two-year full warranty. The
written contract included a provision that stated, “This writing is the full and final
expression of the parties’ agreement; anything said before signing or while signing is
irrelevant.” The written contract did not include a warranty. Two months after Vicki
took delivery of the car, she discovered that the transmission needed to be replaced.
Vicki claimed that it was covered by the full warranty. Will Vicki be able to present
evidence as to the sales representative’s statements concerning the warranty?
a. No. The parol evidence rule will most likely exclude any evidence of the discussion
of the warranty.
b. Yes. The leading object rule will allow evidence as to the discussion of the warranty.
c. Yes. The evidence is needed because the contract is ambiguous.
d. No, because the contract was fully executed.
Jane received a check as payment for her performance at a night club. In turn, she gives
the check to Paul as a gift, but the check turns out to be worthless when he tries to cash
it 45 days later. Does Paul have a claim against Jane?
a. Yes, because he is the holder of the instrument.
b. No, because warranties apply only if the instrument has been transferred for
consideration.
c. No, because he did not make a warranty claim within 30 days.
d. Yes, because Jane should have made sure the check was valid before she gave it to
Paul.
The main difference between the UCC requirement for a writing for a contract for the
sale of goods and the common-law rule is that the
a. UCC requires the signature of only one party.
b. UCC does not require all the terms of the agreement to be in writing.
c. common-law requires only an indication that the parties reached an agreement.
d. common-law requires only the signature of the defendant and the quantity of goods
being sold.
A crime is a violation of statutory law.
a. True
b. False
Oxtron, Inc. is considering establishing a program that actively encourages ethical
behavior. What reasons would support Oxtron’s adoption of an ethics program?
Kris, a shareholder of E-Max, Inc., claimed that the business was being mismanaged.
Kris notified the board of directors that the corporation has been wronged and asked the
board to bring suit in the name of the corporation directly. In response to Kris’ demand,
what actions may the board take? What could Kris’s response be to each alternative?
J.T. Tidwell entered into an oral contract with Robert Anthony for the purchase of 100
head of cattle at a price of $500 each. When the oral contract was made, Tidwell gave
Anthony a check for $1000 as “earnest money or good faith money towards the
purchase of the cattle.” Anthony sold the cattle to someone else. Tidwell sued, asking
the court to either compel Anthony to perform the contract or to pay damages that
Tidwell suffered from the alleged breach of contract. What issues do you see and how
would you resolve those issues?
Jackie purchased a condominium. When she bought it, she realized the homeowner’s
association had a variety of rules and regulations that she would need to follow. One
regulation was that no children were allowed to live in the complex. Two years after
buying the condominium, Jackie gave birth to a child. She was immediately served with
papers notifying her to move out of the complex. Discuss the constitutionality of the
homeowner association’s action.
Sean of Sean’s Shrimp House was enjoying a cup of cappuccino while visiting with
Ollie at Ollie’s Ocean Front Bar & Grill. During the course of their conversation, Sean
agreed to supply 100 pounds of shrimp per month for the next year to Ollie’s restaurant
at the price of $2.50 per pound. When Sean got back to his office, he sent a written
confirmation of the agreement to Ollie. Six weeks after receiving the confirmation Ollie
wrote back, stating that he had not agreed to the price of $2.50 per pound. Is Ollie
bound to the confirmation?
Because negotiable instruments are more valuable than non-negotiable ones, it is
importantfor buyers and sellers to be able to tell, easily and accurately, if an instrument
is indeednegotiable. What six standards must an instrument meet in order for it to be
negotiable?
What is the definition of the business judgment rule?
Jerry knows that Lucy has coveted his classic car for quite some time. Finally willing to
sell it, he sends a letter to Lucy offering to sell the car for $15,000. Lucy responds by
saying she needs time to arrange financing. Lucy offers Jerry $100 to keep the offer
open for two weeks. Jerry agrees, taking the $100. Three days later, Roberta contacts
Jerry saying she is interested in buying the car and has the cash to buy it outright. Jerry
is concerned that if he doesn’t sell the car to Roberta now, she may not be interested
later. Furthermore, Lucy may never be able to arrange financing. Jerry is afraid he may
end up with no buyer at all. He comes to you for advice. What do you advise?
A common problem in cases of express warranty is being able to separate statements
that create express warranties from statements that do not. Discuss what type of
statements create an express warranty and four indications that a statement is likely to
create an express warranty.
Trudy wishes to buy a national franchise. What information is the seller legally required
to provide before she buys the franchise?
Discuss the potential liability differences between a delegation and a novation.
In order to obtain limited liability, Tom and Doris formed an LLC to operate their
catering business. They sometimes deposited the proceeds from catering jobs into their
personal checking accounts and if they needed to pay personal bills and were short of
funds, they used the business account. If creditors of the business cannot get payment
for their invoices, is there anything a court can do to help the creditors?
Vernon and David are the controlling shareholders in E-treme, Inc. Discuss the
obligations that Vernon and David owe to the minority shareholders.
Singleton, an eighty-year-old widower, remarried. The next day, he made a will leaving
everything to his son, Joey. A week after his marriage, Singleton died. How will his
estate be handled?
What are the three tests or elements used by the FTC to determine whether a particular
act is an unfair trade practice?
The city of Richmond needs land owned by the Neelans to expand a middle school. The
Neelans do not want to sell. Discuss what course of action the city can take and the
basis for this action.
Brooke uses her credit card to purchase a lawn mower at the local “big box hardware
store, but when she tries to use the mower for the first time, she finds it is not
self-propelled as advertised. Does she have any recourse?
Explain when presentment warranties apply. Identify the presentment warranties on a
check and a promissory note.