Revised Article 1 of the UCC states that the “money requirement for a negotiable
instrument means the current official currency of the government, not just a medium of
exchange authorized or adopted by a sovereign government as part of its currency.
a. True
b. False
The First Amendment guarantee of free speech applies not only to individuals but also
to corporations.
a. True
b. False
Disaffirmance must be express; it may not be implied.
a. True
b. False
a. What are the basic requirements of a writing within the statute of frauds in Article 2
of the UCC?
b. In what three cases does Article 2 of the UCC permit an oral contract?
The case of In re The Score Board, Inc. involved the issue of:
a. a minor’s liability for misrepresentation of age.
b. whether an incompetent person’s contracts are void or voidable.
c. ratification of a contract upon attaining majority.
d. liability for necessaries.
An “X” or a thumbprint could constitute a signature within the meaning of the term in
the Code.
a. True
b. False
The Securities Enforcement Remedies and Penny Stock Reform Act of 1990 granted
the SEC the power to impose administrative, civil penalties up to the current
inflation-adjusted amount of $725,000.
a. True
b. False
A creditor of a limited partner may obtain a charging order against a partner’s interest in
the partnership, thereby obtaining the rights of an assignee of the partnership interest.
a. True
b. False
Austin withdraws from a partnership and the remaining three partners decide to
continue in business. Discuss the effect of the withdrawal on the partnership and on
creditors rights under the UPA.
William Blackstone, an English jurist, defined law as “a rule of civil conduct prescribed
by the supreme power in a state, commanding what is right, and prohibiting what is
wrong.
a. True
b. False
There is currently a law promoting the purchase, development, and use of industrially
polluted property.
a. True
b. False
Identify the type of indorsement each of the following represents.
a. Pay to Bill, for collection.
b. Pay to the order of The American Bank for deposit only.
c. Pay to Albert, without recourse.
d. John Smith.
A principal’s intention to permit the agent to delegate granted authority may only be
gathered from the express authorization of the principal.
a. True
b. False
The U.S. Constitution was adopted in 1791 by representatives of the thirteen newly
created states.
a. True
b. False
Randy, Mona, and Richard are partners. Under the UPA, a creditor of their partnership
must name all three partners as defendants in a suit on a contract obligation of the
partnership.
a. True
b. False
Directors who are also officers or employees of a publicly held corporation are
“affiliated directors.”
a. True
b. False
Kellie owes a duty to Grant and Kellie delegates the duty to Hank. Hank:
a. is not obligated to either Kellie or Grant to perform the duty unless Hank agrees to do
so.
b. becomes liable for nonperformance to both Kellie and Grant only if Hank promises
both Kellie and Grant that he will perform Kellies duty.
c. cannot create contractual rights in Grant.
d. All of these.
The causes of dissolution and the priorities in the distribution of assets for a limited
partnership are the same as those of a general partnership.
a. True
b. False
Victor negligently led Gus to believe that Brenda had the authority to act on Victors
behalf. If Brenda had no authority but Gus reasonably and in good faith relied on
Brendas apparent authority:
a. Victor can be liable to Gus for Guss loss suffered because of his reliance.
b. Victor cannot be held liable to Gus because Brenda had no actual authority.
c. only Brenda can be held liable for any loss Gus suffered because of his reliance.
d. Gus must bear any loss because he did not determine the extent or existence of
Brendaa authority.
After an FOIA request has been made, an agency has __________ working days within
which to indicate whether it intends to comply.
a. 3
b. 10
c. 21
d. 30
Partners may elect whether or not the partnership will be taxed as a separate entity.
a. True
b. False
Percy, age 17, purchased a used mobile home from a mobile home dealer for $20,000.
This price, however, is twice the reasonable value of that mobile home. Several months
later, Percy wants to disaffirm the contract. If the mobile home is considered a
necessary item:
a. Percy can disaffirm the contract based on the wrongful act of the dealer.
b. Percy can disaffirm the contract because the minor can live in an apartment rather
than a mobile home.
c. Percy is only liable for the reasonable value of the mobile home.
d. Percy must keep the mobile home and abide by the original terms of the contract.
Tort liability is civil liability that is voluntarily assumed.
a. True
b. False
A gratuitous promise is a promise made without consideration.
a. True
b. False
a. Discuss the rights of an injured employee against her employer under common law.
b. How have workers’ compensation acts changed this? Explain your answer.
The Federal Employee Polygraph Protection Act:
a. prohibits private employers (with some exceptions) from using lie detector tests or
test results as grounds for adverse employment decisions.
b. prohibits only the federal government’s use of polygraphs for making employment
decisions.
c. allows polygraphs of employees only to determine illegal drug use by them.
d. completely prohibits all use of polygraphs by employers.
The Fair Debt Collection Practices Act requires a debt collector to provide the
consumer with a written notice. What information must be contained in this notice?
a. The amount of the debt, with interest and penalties clearly delineated.
b. The name and phone number of the current creditor and former creditor.
c. A statement telling the consumer that he can request verification of the alleged debt.
d. A copy of the original credit contract with the original creditor.
In some states, minors are liable for contracts involving bank accounts and student
loans and cannot avoid these contracts even though they can avoid other types of
contracts.
a. True
b. False
Under Revised Article 4, if a bank pays a postdated instrument prior to its date, it will
be a proper debit to the drawer’s account, unless the drawer had timely informed the
drawee that the check was postdated.
a. True
b. False
A thief stole Harold’s car and installed a tape deck in it. Later the police caught the thief
and returned the car to Harold. Harold now owns the tape deck by accession.
a. True
b. False
Holly, who is married to Grant, applies for a credit card from Marlin’s Department
Store, but she is turned down because she is a married woman and the store’s policy is
to only issue cards in the name of the husband in such situations. What are her legal
rights in this situation?
Delbert won a $500 bet with Samuel on the outcome of the World Series, but Samuel
refuses to pay. Discuss what recourse Delbert has. If Delbert had instead bought a ticket
from a state-operated lottery, would his recourse be different?
What are the essential elements of a contract? List and discuss them.
Define and discuss the doctrine of ‘sovereign immunity.” Discuss how the Foreign
Sovereign Immunities Act of 1976 has codified this area of law. Give examples of how
the Act works.
How does the liability of a common carrier differ from that of an ordinary bailee with
regard to property that is lost or damaged while in possession of the carrier?
Discuss the similarity between a management buyout and a cash-out combination.
The SEC would like to adopt some new rules to protect investors. What factors should
it consider as part of the administrative process?
List the services that the Sarbanes-Oxley Act prohibits accounting firms from
performing for audit clients.
In providing services for his client, an accountant obtains information concerning the
client’s business affairs. What are the legal issues concerning this client information?
Jesse purchases 50 shares of Mountain Ridge Corporation stock. Explain what, if any,
liability Jesse has to the corporation or its creditors with respect to the shares.
On June 1, Edward visited a bicycle sales and service center. Edward spotted a used
bike he liked and was told by the dealer that he could have the bike for $100 cash. Since
Edward needed a few days to get the money, Edward got a signed, written statement by
the dealer that Edward could buy the bike for $100 at anytime on or before June 15. On
June 10 Edward came to the dealer with the money, but the bike had been sold to
another customer. Was the dealer under any obligation to Edward to keep this offer
open until June 15? Give legal reasoning for your answer.
What are the requisite elements of fraud?
Mary receives her monthly bank statement on December 30th. She looks at it quickly,
then sets it aside. Three days later, she examines it again and discovers a forged check.
What must she do to avoid responsibility for the check?
Describe an LLC and the rights of its members.
What are the two types of fraud and what is the effect of each on the contract involved?
Give an example of each type of fraud.