Vieux Carré S.A., a French firm, imports its goods into the United States and offers
those goods for sale at “less than fair value.” “Fair value” is the price of
a. comparable goods in a select “basket” of other countries.
b. Vieux Carré’s goods in France.
c. Vieux Carré’s goods in the United States.
d. Vieux Carré’s goods on the world market.
Louis’larger and stronger than Micathreatens to hit Mica before hitting and injuring
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. neither assault nor battery.
Master Manufacturing Corporation has exclusive control over the market for its
product. Under the Sherman Act, this is
a. a per se violation.
b. a violation if it acquired this power through “business acumen.”
c. a violation if it acquired this power through “anticompetitive means.”
d. not a violation.
Sable and Rex agree while talking on the phone to form a partnership to deal in
transfers of real property. Their partnership agreement is legally binding
a. only if a copy of the agreement is filed in the appropriate state office.
b. only if the agreement is reduced to writing.
c. only if the parties exchange valid consideration.
d. without more.
Pronto Tacos LLC grants a franchise to Omar to open and operate a Pronto Tacos
restaurant. Pronto will likely charge Omar
a. an initial fee or lump sum price for the franchise license.
b. a percentage of Omar’s weekly payroll expense.
c. an amount of Omar’s monthly overhead savings, if any.
d. none of the choices.
Elmo pays First National Bank $1,000 plus a service fee to draw a check on itself made
payable to Go Delivery Service. This is
a. a cashier’s check.
b. an overdraft.
c. a stale check.
d. a stop-payment order.
Denise borrows $90,000 from Clear Lake Credit Union to buy a home. Denise loses her
job and fails to make payments on the mortgage, but assures Clear Lake Credit that she
will soon secure a new job. The lender agrees to postpone the payments. This is
a. a bridge loan.
b. forbearance.
c. a reamortization.
d. a restructure.
Scott presents an instrument that states “pay to the order of Scott” to Town Bank for
payment. This instrument is the most common type of negotiable instrument, which is
a. a commercial wire transfer.
b. a check.
c. a note.
d. a substitute check.
To obtain office supplies for All-Care Medical Clinic, Britney executes a draft in favor
of Chris. A draft is
a. a conditional promise to pay money.
b. an unconditional written order to pay money.
c. a qualified promise to set aside a sum of money.
d. a restricted promise to deliver goods at a future date.
Ilsa and Jiffy Loan Company enter into an oral contract under which Ilsa agrees to pay
Kyle’s debt if he does not. Ilsa does not get any personal benefit from the agreement.
This contract is enforceable by
a. any party.
b. Jiffy only.
c. Jiffy or Kyle.
d. none of the parties.
Genetic Seed Company hires Howie to work on Genetic’s shipping dock, accepting
deliveries and dealing with other companie’ drivers. With respect to Genetic, Howie is
most likely
a. an agent.
b. an independent contractor.
c. a principal.
d. a work for hire.
Mary writes a check drawn on County Bank for $400 “payable to Bill” on May 1. Mary
dies on May 3. Bill presents the check to County Bank on May 5. County Bank
a. may not pay the check.
b. may pay the check.
c. must consult with Mary’s heirs before paying the check.
d. must read Mary’s will before paying the check.
Picabo drives a truck as an employee for Quik Delivery, Inc. Picabo would most likely
be considered acting outside the scope of her employment if she
a. crashed into a car at the airport while off duty.
b. hit a pedestrian in a parking lot during a “working” lunch.
c. ran over an attendant at Quik’s gas station while refueling the truck.
d. smashed into a store-front while intoxicated on-duty.
To initiate a lawsuit, Darla files a complaint against E-Sales Company, which responds
with an answer. Together, the complaint and answer are
a. a motion to dismiss.
b. a summons.
c. a writ of certiorari.
d. the pleadings.
Efron transfers an instrument to First Citizens Bank. This is not a negotiation unless
a. the parties bargained over the amount paid for the instrument.
b. the transfer is an assignment.
c. the instrument is a negotiable instrument.
d. the transfer includes rights under a contract.
Genuine Seed Company and Hillside Farmers Cooperative enter into a contract for a
sale of hybrid seeds. Under the perfect tender rule, Genuine Seed must ship or tender
seeds to Hillside that
a. approximately conform to all of the details of the contract.
b. entirely conform to the contract except in one or two details.
c. exactly conform to the contract in every detail.
d. substantially conform to the contract in most details.
Sigrud buys spiked mountain-climbing shoes from Rockridge Gear store. The spikes
come out of the shoes when Sigrud is on the side of a mountain, causing her to be
injured in a fall. Rockridge breached
a. an express warranty.
b. an implied warranty of fitness for a particular purpose.
c. an implied warranty of merchantability.
d. a warranty of title.
Violet negotiates with Urban Credit Corporation to obtain a loan for $85,000 to buy a
home. During the negotiations, Urban Credit orally misrepresents the terms, but
provides the required documents, which accurately state the terms. Violet does not read
the documents. The party or parties most likely liable for a violation of the law is
a. neither party.
b. Urban Credit.
c. Urban Credit and Violet.
d. Violet.
At 1 a.m., on the sidewalk in front of Ace Credit Corporation, which is closed, Ben
buys a $500 promissory note for $50 from Curt. When presented with Ben’s demand for
payment, Diann, the maker of the note, could successfully claim that Ben
a. acquired the note with notice that it was overdue.
b. did not acquire the instrument in good faith.
c. did not give value for the instrument.
d. none of the choices.
Fact Pattern 36-1
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.
Refer to Fact Pattern 36-1. Nika’s ownership interest is
a. a fee simple absolute.
b. a leasehold estate.
c. a life estate.
d. an easement.
Sally is the secured party in a transaction with Lilly, who is the debtor. Sally files a
financing statement with the appropriate state official. The financing statement must
contain
a. Lilly’s signature.
b. Sally’s bank account information.
c. Lilly’s credit report.
d. a photograph of the collateral.
Myron and Norah would like to form Originals, Inc., to do business in the art market.
Generally, the articles of incorporation for a corporation do not include
a. the corporate name.
b. the nature and purpose of the corporation.
c. the capital structure of the corporation.
d. the minutes of the first organizational meeting.
Patricia commits an act via e-mail against Othman Finance Company, a business in
California, where the act is a cyber crime. Patricia resides in New York where the act is
not a crime. Prosecution of Patricia in California involves questions of
a. jurisdiction.
b. “maximum contacts.”
c. the immunity of Internet service providers.
d. encryption.
Hal contracts with Credit Services, Inc. (CSI), to pay $500 for its services. After CSI
performs, they sign an accord, in which Hal promises to pay $400 within ten days
instead of the $500. Hal does not pay. CSI can sue Hal under
a. neither the accord nor the contract.
b. the accord only.
c. the accord or the contract.
d. the contract only.
Erin and Dooley, a married couple, borrow $120,000 from Capital & Credit Bank to
buy a home. When Erin and Dooley divorce, they are unable to make payments on the
mortgage. The market value of the home has declined to less than the balance of the
loan. Capital & Credit agrees to a sale of the property for this amount. This is
a. a deed in lieu of foreclosure.
b. a home equity loan.
c. a reverse mortgage.
d. a short sale.
Barbara and Johann are parties to a contract. They agree on a novation. The novation
requires
a. the existence of a previous, valid obligation.
b. consideration greater than $5,000.
c. performance of the original contract by all of the parties.
d. an accord and satisfaction.
Jeannie runs a dude ranch called J Bar B Dude Ranch and has a Web site called
www,jbarbduderanch.com. Ben starts another dude ranch and registers a Web site called
www,jbarbduderanch.com. Ben is
a. cybersquatting.
b. cyberstalking.
c. not doing anything illegal.
d. counterfeiting.
Bee Hive Honey, LLC’s members include Chad. For purposes of suing and being sued,
Bee Hive Honey is
a. an aggregate of Chad and the other members.
b. a natural person in the member’ “family.”
c. a legal entity apart from the owners.
d. a non-participating third party.
Cleaners & Solvents, Inc. (CSI), engages in deceptive advertising when it markets its
product Dirt Remover as able to kill germs over long periods of time. In an action
against CSI regarding Dirt Remover, the firm is ordered to stop its false advertising of
Dirt Remover and other products. This is
a. a counteradvertising order.
b. a multiple product order.
c. a “cooling-off” law.
d. a validation notice.
Mace copies Nick’s book, Mumbai Monsoon, in its entirety and sells it to Parkland
Books, Inc., without Nick’s permission. Parkland publishes it under Mace’s name. This
is
a. copyright infringement.
b. fair use.
c. licensing.
d. protected expression.
Digital Products Company includes a shrink-wrap agreement in a transaction with
Eagle Engineering Corporation. A shrink-wrap agreement is an agreement whose terms
are expressed
a. in code at the end of a computer program .
b. inside a box in which goods are packaged.
c. in small print at the end of a paper contract signed by both parties.
d. on a computer screen.
To raise $12 million to expand operations, Star Corporation makes a stock offering
directly to sixty accredited investors and twenty sophisticated, but unaccredited
investors. Star plans to notify the SEC of sales. Under the Securities Act of 1933, this
issue may qualify as an “exempt” transaction
a. as is.
b. if all of the investors are also given certain material information.
c. if the offering is also made available to the general public.
d. under no circumstances.
Joint venturers have the authority to enter into contracts for the business that will bind
the joint venture.
A financing statement must include the creditor’s signature.
A bank has no right to charge a customer’s account for the amount of a stale check.
Securities of nonprofit, educational, and charitable organizations are not exempt from
the registration requirement of the 1933 Securities Act.
An adjustable-rate mortgage is a standard mortgage with an unchanging rate of interest.
A plaintiff who proves unlawful discrimination may be awarded reinstatement, back
pay, but not retroactive promotions.
Restrictions on imports may include quotas.
An order for relief in a bankruptcy proceeding amounts to a discharge of the debts of
the party petitioning for bankruptcy protection.
A merchant is a person who deals in goods of the kind involved in the sales contract or
who holds herself or himself out as having skill or knowledge peculiar to the practices
or goods being purchased or sold.
Today, most checks are processed manually.
An illusory promise is unenforceable.
The Fifth Amendment prohibits unreasonable searches and seizures of persons or
property.
International law is a body of law that governs relations between and among citizens,
not countries.
A manufacturer’s duty of care extends to the inspection and testing of products bought
to incorporate in the final product.
Counteradvertising requires a company to advertise the products of its competitor to
counter its own false claims.
According to utilitarianism, an action that affects the majority adversely is morally
wrong.