Omni Corporation is a Pennsylvania-based firm that does business throughout the
United States. With respect to this circumstance, the UCC has been adopted by, and
applies in,
a. a few of the states.
b. all of the states, in whole or in part.
c. half of the states.
d. none of the states, to date.
Brick Products, Inc., files a suit against City Trucking Service for breach of contract,
based on what Brick claims was City’s offer. For a court to determine if a contract has
been breached, under the common law, the offer must include terms that are
a. exactly precise.
b. reasonably definite.
c. unequivocally approximate.
d. vague or uncertain.
Transnational Corporation and UniShip, Inc., agree to a contract that includes an
arbitration clause. If a dispute arises, a court having jurisdiction may
a. monitor any arbitration until it concludes.
b. order an arbitrator to rule in a particular way.
c. order a party to bring the dispute to court.
d. order a party to submit to arbitration.
Lightspeed Inc. makes computers, each of which is packaged with a shrink-wrap
agreement. Milo buys a Lightspeed laptop. The terms of the shrink-wrap agreement are
most likely enforceable if
a. Milo buys the computer directly from Lightspeed.
b. Milo uses the computer after reading the terms.
c. Milo pays for the computer before reading the terms.
d. the terms concern warranties.
Heidi and Ian are directors and shareholders of Globe Software, Inc. Heidi’s written
authorization to Ian to vote Heidi’s shares at a Globe shareholders’ meeting is
a. a violation of the duty of loyalty.
b. a preemptive right.
c. a proxy.
d. a quorum.
In making business decisions, Glenda, personnel manager for HVAC Maintenance, Inc.,
applies his belief that all persons have fundamental rights. This is
a. a religious rule.
b. the categorical imperative.
c. the principle of rights.
d. utilitarianism.
Luann and Mace are partners in Networx, a computer peripherals firm.
Mace dissociates from Networx. Luann signs a contract with Physik Drives, a
wholesale component supplier, apparently on Networx’s behalf. Physik does not know
of Mace’s dissociation. The contract is binding on
a. Luann, Mace, and Networx.
b. Luann only.
c. Networx only.
d. Physik only.
It is possible to copyright an idea.
Modern Clothing, Inc., and National Denim Corporation use the mark “Made by
Members of the U.S. Textile Workers Union” on the tags of their products to indicate
the participation of the union in the manufacture. Modern and National are not in
business together and do not own this mark. The mark is
a. a certification mark.
b. a collective mark.
c. a service mark.
d. trade dress.
Gina induces Hugh to enter into a contract for the purchase of a condominium about
which Gina knowingly misrepresents a number of material features. When Hugh
discovers the truth, he can
a. not rescind the contract.
b. rescind the contract on the basis of fraud.
c. rescind the contract on the basis of mistake.
d. rescind the contract on the basis of undue influence.
Don, a salesperson for Excel Autos, promises Fern that a certain car will give her a
‘smooth ride.” Don offers a test drive, which Fern declines. She buys the car but soon
realizes that its suspension is in poor condition. Fern
a. can rescind the contract on the ground of fraud.
b. can rescind the contract on the ground of misrepresentation.
c. can rescind the contract on the ground of mistake.
d. was not defrauded.
Phil enters into a contract with Quality Resorts, Inc., to work as a chef. Under the plain
meaning rule, the meaning of this contract must be determined by reference to
a. any available evidence.
b. any relevant extrinsic evidence.
c. the face of the instrument.
d. the later testimony of the parties.
Sunshine Cell Phone Company offers to buy a laser printer, with a case of paper and an
extra cartridge, from Office Products, Inc. (OPI), for $200. Paul, OPI’s representative,
says, “Okay, but no paper and no extra cartridge.” Paul has
a. accepted the offer.
b. made a counteroffer without rejecting the offer.
c. rejected the offer and made a counteroffer.
d. rejected the offer without making a counteroffer.
Leo slips and falls in Mornin” Breakfast Café and is injured. Leo files a suit against
Mornin” for $50,000. If Leo is 20 percent at fault and Mornin” is 80 percent, under a
contributory negligence doctrine, Leo would recover
a. $0.
b. $25,000.
c. $40,000.
d. $50,000.
Vernon claims that his contract with Ulani for catering services is voidable. If their
contract is avoided
a. both parties are released from it.
b. both parties must fully perform their obligations under it.
c. a wholly different contract is agreed to.
d. a wholly different contract is imposed “as if” the parties had agreed.
Peak & Vale Accountants provides other firms with accounting services. Questions of
what is ethical involve the extent to which Peak & Vale has
a. a legal duty beyond those duties mandated by ethics.
b. an ethical duty beyond those duties mandated by law.
c. any duty beyond those mandated by both ethics and the law.
d. any duty when it is uncertain whether a legal duty exists.
Global Shipping Corporation enters into contracts with distributors and other buyers in
e-commerce and in traditional commerce. The UETA applies, if at all, only to those
transactions in which the parties agree to use
a. electronic means.
b. paper documents.
c. updates and cross-checks to orally verify any e-terms.
d. notarized documents.
A contract between Donald and Chloe to lease commercial property contains an excul-
patory clause. This clause is
a. enforceable as a matter of public policy.
b. enforceable if either party is in a business important to the public.
c. enforceable if an event occurs to which the clause applies.
d. generally unenforceable.
The Federal Trade Commission is a government agency that issues rules, orders, and
decisions. The Georgia state legislature enacts statutes. The Jackson County Board and
the Peach City Council enacts ordinances. Administrative law includes
a. all law that affects a business’s operation.
b. the rules, orders, and decisions of the Federal Trade Commission.
c. statutes enacted by the Georgia state legislature.
d. ordinances created by the Jackson County Board and the city council of Peach City,
Georgia.
International 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. International’s place of business.
b. JOI’s place of business.
c. the Annual Gems and Jewels Convention.
d. the U.S. Postal Service office nearest to JOI’s place of business.
Based on Bluto’s conduct, Cass reasonably believes that Dee has the authority to act on
Bluto’s behalf even though Dee does not have the actual authority to do so. Bluto has
a. apparent authority.
b. equal authority.
c. express authority.
d. implied authority.
Clarice pays Damien $10,000 to design an ad campaign for her Sweetwater Coffee
Stand chain. The next day, Damien tells Clarice that he has accepted a job in New York
and cannot design her campaign. She files a suit against Damien. As compensatory
damages, she can recover
a. $100,000.
b. $10,000.
c. $1,000.
d. $0.
Mariah wins her suit against Variety Products Company. Variety’s best ground for
appeal is the trial court’s interpretation of
a. the conduct of the witnesses during the trial.
b. the credibility of the evidence that Mariah presented.
c. the dealings between the parties before the suit.
d. the law that applied to the issues in the case.
Deb buys a song through eSongs, an online music vendor. Before completing the
purchase and downloading the song, Deb must agree to a provision not to make and sell
copies of the song. This provision is
a. a browse-wrap term.
b. a click-on agreement.
c. a shrink-wrap agreement.
d. a choice-of-law clause.
In 2012, Online Marketing Corporation registers its trademark as provided by federal
law. After the first renewal, this registration
a. is renewable every ten years.
b. is renewable every twenty years.
c. runs for the life of the corporation plus seventy years.
d. runs forever.
Bret contracts to work for City Construction Corporation (CCC) during July for $4,500.
On June 30, CCC cancels the contract. Bret declines a similar job with Downtown
Builders, Inc., which would have paid $4,000. Bret files a suit against CCC. As
compensatory damages, Bret can recover
a. $4,500.
b. $4,000.
c. $500.
d. $0.
Fay is mentally incompetent but has not been so adjudged by a court. Any contract Fay
enters into is
a. voidable if Fay has a lucid interval at the time of contracting.
b. voidable if Fay lacks the capacity to comprehend the consequences.
c. voidable if the other party does not realize that Fay is incompetent.
d. unavoidable.
Haruko, who owns and operates Garden Orchard, agrees to sell Fresh Produce
Cooperative ten bushels of apples.
When the market price for apples exceeds the price in the contract with Fresh Produce,
Haruko decides not to deliver the apples. This
a. breaches the contract.
b. discharges the contract.
c. has no effect on the contract.
d. suspends the contract.
Brad stands in front of Rustler’s Round-Up Café, shouting “fighting words” that are
likely to incite Rustler’s patrons to respond violently. The First Amendment protects
such speech
a. all of the time.
b. none of the time.
c. only if it is noncommercial.
d. only if it is symbolic.
Rashad accesses Quant Company’s computer system without authority to obtain
protected financial data. Under federal law, this is
a. a felony if it is committed for a commercial purpose.
b. a felony if Quant brings a civil suit against Rashad.
c. not a crime.
d. a crime, but not a felony.
Posing as Platinum Bank, Oswald e-mails Nadia, asking her to update her personal
banking information through a link in the e-mail. She clicks on the link and types in the
data, which Oswald promptly sells to Moe. This is
a. no crime.
b. employment fraud.
c. phishing.
d. vishing.
On May 1, City Auto & Truck Sales agrees to sell a car to Dino. Five days later, Dino
refuses delivery and cancels the contract. City is entitled to
a. force Dino to accept the car.
b. recover any damages from Dino but not resell the car.
c. resell the car and recover any damages from Dino.
d. resell the car but not recover any damages from Dino.
Silky Material Corporation in New Jersey sells fifty tons of fabric to Tattered Clothing,
Inc., in Ohio, “F.O.B. New Jersey.” The cost of transporting the fabric to Ohio will be
paid by
a. Silky Material.
b. Tattered Clothing.
c. New Jersey.
d. Ohio.
Sweet Candy, Inc., and Tasty Treats Stores enter into a contract for a sale of candy.
Sweet, a merchant who deals in goods of the kind sold, makes express warranties in
connection with the sale. Under the UCC, at the time a contract is formed, an express
warranty can be disclaimed or modified
a. by clear, conspicuous language called to the buyer’s attention.
b. by implied affirmations of fact relating to the goods.
c. in any way that the seller sees fit for the ordinary purpose.
d. in no way.
Biff wrongfully takes an unopened carton from a Cold Storage Warehouse loading
dock, puts the carton in his car, and drives away. This is
a. burglary.
b. robbery.
c. larceny.
d. no crime.
Adhesion contracts are often held to be contrary to public policy.
A contract involving property of any kind must be in writing to be enforceable.
In many states, an operating agreement is not required for a limited liability company to
exist.
Federal law permits a partnership to be treated as an entity in suits in federal courts.
A business organization and its actions cannot be based on trust.
Browse-wrap terms are often unenforceable.
A buyer who obtains substitute goods to replace goods that a seller did not deliver can
also recover damages from the seller.
Mediation is adversarial in nature.
Contracts that are executory on both sides can be rescinded by agreement.
An executed contract is one that has been fully performed.
Tender must occur at a reasonable hour and in a reasonable manner.
A state law that treats nonresidents different from residents may violate the privileges
and immunities clause.
On the breach of a contract involving the sale of land, money damages is always the
most appropriate remedy.
The legality of an action is always clear.
A state law that conflicts with the U.S. Constitution will be deemed unconstitutional.
An agent has the implied authority to do what is reasonably necessary to carry out
express authority.