Drake pushes Evon into the path of an oncoming car driven by Flip. Gina tries to rescue
Evon, but the car hits both of them. Drake is liable for the injuries of
a. Evon and Gina.
b. Evon only.
c. Gina only.
d. neither Evon nor Gina.
Edy obtains a homeowners insurance policy with First Source Insurance Company.
First Source can cancel the policy
a. if Edy appears as a witness in a case against First Source.
b. if Edy fails to pay the premiums.
c. if Edy makes changes that add to the homes value.
d. under no circumstances.
Green River Energy Corporation wants to begin operations that include the discharge of
waste into navigable waters. Under the Clean Water Act, Green River must install
certain equipment
a. after beginning operations.
b. before beginning operations.
c. during operations.
d. only if a regulatory agency challenges the discharge.
Louislarger and stronger than Micathreatens to hit Mica and then hits and injures him.
Mica files a suit against Louis for assault and battery. Mica will most likely recover for
a. assault and battery.
b. assault but not battery.
c. battery but not assault.
d. not assault or battery.
Kip is Lulus agent and is authorized to write checks on Lulus account in Metro Bank.
Kip writes a check “pay to the order of Nemo. Kip signs the check “Lulu, by Kip, agent.
If Metro Bank dishonors the check, liability extends to
a. Kip and Lulu.
b. Kip only.
c. Lulu only.
d. no one.
Jerzy is an accountant whose clients include Kopper Kettle Restaurants, Inc. For a
violation of securities laws, Jerzy may be subject to
a. comprehensive liability.
b. corporate liability.
c. criminal liability.
d. no liability.
Nu-Tec Company contracts to sell fiber optic cable to Online Services, Inc. Nu-Tec
ships the cable, which Online accepts but does not pay for. Nu-Tec can
a. sue to recover the purchase price plus incidental damages.
b. sue to recover the purchase price minus incidental damages.
c. resell the cable to any buyer willing to reclaim it from Online.
d. require Online to revoke its acceptance of the cable.
The Food and Drug Administration (FDA) is investigating reports that Caplets
Pharmaceutical Corporation is putting potentially harmful additives in Doze, a new
pain-relief medication. The FDAs demands for particular documents from Caplets
a. must be specific and adequately describe the material being sought.
b. must be non-specific so an incriminating item is not overlooked.
c. must be general so as to force an uncooperative partys compliance.
d. may, but need not, be specific because the FDA is a federal agency.
Lia works for Media Marketing Company. Her job includes putting ‘spin on the firms
successes and failures. In this context, ethics consist of
a. “bad versus “good publicity.
b. questions of rightness and wrongness.
c. the firms quarterly revenue.
d. whatever is legal.
Orlys debts are discharged in a liquidation bankruptcy. Pester & Recover, Inc., buys the
discharged debt obligations. With respect to these debts, Pester
a. can do nothing.
b. can pressure Orly into paying them.
c. must give Orly additional help to rebuild her life after the discharge.
d. must report the debts to credit reporting agencies as “discharged.
The U.S. Congress enacts a new federal statute that imposes liability on businesses
emitting significant amounts of a certain pollutant into the environment. This statute
applies
a. only to matters not covered by state law.
b. only to those states that adopt the statute.
c. to all of the states.
d. to none of the states.
Start-Up Enterprises, Inc., completes its registration process and begins advertising the
availability of its new issue of securities. Start-Up places a tombstone ad in the financial
papers. This ad tells prospective investors
a. about investing.
b. about the company.
c. where to buy the securities.
d. where to obtain a prospectus.
Hu believes that he is a victim of a form of employment discrimination that falls under
the Civil Rights Act of 1964. Compliance with this statute is monitored by
a. employees and job applicants, not an administrative agency.
b. employers and businesses, not an administrative agency.
c. the courts and Congress, not an administrative agency.
d. the Equal Employment Opportunities Commission.
Clearview 3D HD TV Company grants its agent Blossom an exclusive territory in
which to sell Clearview products. Clearview cannot compete with Blossom in that
territory under the principals duty of
a. avoidance.
b. cooperation.
c. indemnification.
d. reimbursement.
Fact Pattern 14-A1
Linea, an employee of Hard Labor Industries (HLI), is injured in a work-related
accident. Based on the diagnosis of Newt, a doctor, Linea accepts $50,000 from HLI
and waives the right to future claims. Newts diagnosis later proves to have been wrong.
In terms of the impact on Lineas agreement with HLI, Newts misdiagnosis is
a. a mistake of fact.
b. an experts puffery.
c. innocent misrepresentation.
d. negligent misrepresentation.
Nick sees Opal, a stranger, in peril, but does not attempt to rescue her. Opal could
successfully sue Nick for
a. negligence per se.
b nothing.
c. a violation of the “danger invites rescue doctrine.
d. a violation of a Good Samaritan statute.
Fact Pattern 31-1B
Northeast Bank makes mortgage loans to consumers, including Mai, to buy homes.
required disclosures. Mai has a right to rescind the mortgage
a. at any time.
b. under no circumstances.
c. within three business days.
d. within whatever period is most rational and appropriate.
Bob, a salesperson at a Carpets Galore store, tells Dita, a customer, “Buy your carpet
here, and Ill install it for half of what the store would charge. Dita buys the carpet,
which Bob installs for half the stores price. Bob keeps the money. Bob has breached
a. no duty.
b. the duty of loyalty.
c. the duty of notification.
d. the duty of obedience.
Heavy Equipment Corporation leases six forklifts to Inland Refining Company, but as
the forklifts are delivered, they are lost in an explosion. Under the UCC, the parties
rights and obligations with respect to the loss depend on the concept of
a. identification.
b. insurable interest.
c. risk of loss.
d. title.
Riverview Bank makes a mortgage loan of $95,000 to Pomeroy to buy a home. Under
federal law, if Riverview fails to provide certain material disclosures with respect to the
loan, Pomeroys right to rescind the loan
a. expires at midnight on the day the loan is finalized.
b. is canceled immediately.
c. is extended for up to three years.
d. is tolled for the duration of the mortgage payments.
Chars daughter Delsey dies before Char, leaving Delseys son Egor. On Chars death, it is
learned that Chars will gives “to my daughter Delsey my ranch in Mesquite County,
Texas. Most likely, the gift of the ranch
a. abates.
b. will not lapse.
c. lapses in full.
d. lapses in part.
A Fact Pattern 17-A2
Evelyn, who owns and operates Eves Farm & Garden Company, agrees to sell Hill &
Dale Produce, Inc., fifty bushels of apples.
When the market price for apples exceeds the price in the contract with Hill & Dale,
Evelyn decides not to deliver the apples. Evelyns contract with Hill & Dale is
a. breached.
b. discharged.
c. not affected.
d. suspended.
Ruth, a minor, charges groceries at Sams Mini-Mart. Two days later, Ruth disaffirms the
purchase. Ruth owes Sams
a. the reasonable value of the groceries.
b. the retail value of the groceries.
c. the wholesale value of the groceries.
d. nothing.
Francies debt to Gage is past due. Gage brings a legal action against Francie to collect
the debt. To ensure that a judgment in Gages favor will be collectible, Gage asks the
court to order the seizure of Francies property. This is a request for
a. a guaranty (or suretyship) contract.
b. an order that would violate most state laws.
c. a writ of attachment.
d. an order of receivership.
Rico, an engineer for Shur-2-Gro Seed Corporation, learns that Shur-2-Gro has
developed a corn hybrid to triple the output of any farm. Rico buys 20,000 shares of
Shur-2-Gro stock. He tells Taylor, who buys 15,000 shares. After the new hybrid is
announced publicly, the price of Shur-2-Gro stock increases. Rico and Taylor sell their
shares for a profit. Under the Securities Exchange Act of 1934, liability may be
imposed on
a. none of these parties.
b. Rico and Taylor only.
c. Rico only.
d. Rico, Shur-2-Gro, and Taylor.
Fact Pattern 14-A2
Moore Properties, Inc., offers in writing to sell to New Development Corporation
(NDC) a certain half-acre of land for “$112,000. After New Development signs the
offer in acceptance and returns it, Moore discovers that the price should have been
stated as “$121,000.
Moores misstatement of the price is
a. a bilateral mistake.
b. a fraudulent misrepresentation.
c. a unilateral mistake.
d. unconscionable.
Reusable Energy Corporation regularly expresses opinions on political issues. Under
the First Amendment, corporate political speech is
a. discouraged.
b. forbidden.
c. protected.
d. required.
Penelope is an attorney. Penelopes conduct is governed by rules of professional conduct
established by the state in which she is licensed, and the Model Rules of Professional
Conduct drafted by
a. federal courts.
b. the American Bar Association.
c. the American Institute of Certified Public Accountants.
d. the International Accounting Standards Board.
Merchant Supply Company and National Discount Stores enter into a contract for a
lease of cash registers. Merchant assures National that it has valid title to the goods.
Under the UCC, this type of title warranty arises
a. automatically in most lease contracts.
b. only if the lessee asks for such a warranty.
c. only if the lessor expresses such a warranty.
d. only in conjunction with sales contracts, not lease contracts.
Grain from Harvest Farms is wrongfully commingled with grain from Idyllic Fields,
which obtains possession of all of the grain. This is
a. a bailment.
b. accession.
c. confusion.
d. production.
Fact Pattern 24-1A
Flik draws a check payable to “DeliMart to buy groceries.
Refer to Fact Pattern 24-1A. With respect to Fliks check, DeliMart is
a. the drawee.
b. the drawer.
c. the maker.
d. the payee.
A deal between Lou and Mike requires a transfer of stolen body building equipment for
counterfeit currency that Mike will attempt to spend at Now! Discount Mart. This
contract is
a. enforceable.
b. void.
c. voidable at the option of Lou or Mike.
d. voidable at the option of Now!
Xavier owns a duplex that he leases to Yves and Zeb. Xavier may sell
a. the duplex at any time.
b. the duplex, but only after the lease expires and the tenants move out.
c. the duplex, but only with the tenants permission.
d. the lease, but not the duplex.
Rick and Sandy are limited partners in Total Profit Enterprises, a limited partnership. To
avoid personal liability for partnership obligations, they must not
a. acquire an interest in the firm.
b. contribute property to the firm.
c. engage in activities independent of the firms business.
d. participate in the firms management.
On behalf of the rock group Uno, their manager Thalia agrees to a performance in
Seaside Amphitheatre on July 4. Rex, acting for Seaside, sends a written copy of the
agreement to Thalia to be signed. If Thalia signs the copy, the parties will have
a. an express contract.
b. an implied contract.
c. a quasi contract.
d. no contract.
Some companies have set up confidential systems for employees to “raise red flags
about suspected unethical practices.
A bank may charge a postdated check against a customers account.
A party can challenge an administrative regulation as so irrational as to be arbitrary and
capricious.
Foreign investors are not allowed to become limited liability company members.
Federal securities laws strictly control the terms, duration, and circumstances under
which most tender offers are made.
A limited liability company is not a citizen of any state.
The taxing and spending clause of the U.S. Constitution has had a greater impact on
business than any other clause in the Constitution.
Drew is an officer of Energy Fuel, Inc. Drew knows that an Energy engineer recently
developed a new, inexpensive method for converting hydrogen into fuel. Drew takes
advantage of this information to buy Energy stock from Gert and, after the discovery is
announced, to sell the stock to Holly at a profit. Gert claims that this is a violation of
federal law. Is Gert correct? If so, what federal law has Drew violated, and what are its
possible penalties?
A purchaser cannot become an HDC of an instrument so incomplete that an element of
negotiability is lacking.
A reasonable person standard determines whether a person could have avoided
suffering harm from anothers allegedly negligent act.
If a trust does not provide for its termination, it will not terminate.
The owner of a fee simple absolute has the right to use property for whatever purpose
he or she sees fit.
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.
The only requirement of a valid contract is that it be voluntarily entered into.
A certificate of deposit is a type of note.
Constitutional law includes only the U.S. Constitution.
A partners profit from a partnership is taxed as income to the firm.
A holder cannot become an HDC unless hr or she has notice of any claim to the
instrument or defense against it.