1) No contract can prohibit delegation of the duties of the contract.
2) Attempted monopolization is a violation of antitrust law.
3) Major credit reporting agencies must provide consumers with free copies of their
own credit reports every six months.
4) A sublease releases the tenant from his or her obligations under the lease.
5) A trade name can be protected under the common law, but only if it is unusual or
fancifully used.
6) A sanction known as counteradvertising requires a company to advertise anew to
inform the public about earlier misinformation.
7) Persons cannot share ownership rights simultaneously in particular property
(including real property and personal property) – one person’s interest is always
superior.
8) Fredrik signs a check “pay to the order of Gennifer” drawn on Fredrik’s account in
Harborside Bank to buy Gennifer’sjet ski. Fredrik asks the bank to indicate on the face
of the check that it will accept it when Gennifer presents it for payment. If the bank
agrees, this will be
a.a cashier’s check.
b.a certified check.
c.a teller’s check.
d.a traveler’s check.
9) Jon, a law enforcement official, monitors Kelsey€s Internet activities-e-mail and Web
site visits-to gain access to her personal financial data and student information. This
may violate Kelsey€s right to
a.equal protection of the law.
b.privacy.
c.procedural due process.
d.substantive due process.
10) Fact Pattern 30-1B
Resource Drilling Company buys equipment for use in its operations, borrowing $1
million from Security Finance Corporation for a security interest in the equipment. The
next day, Resource Drilling borrows $500,000 from Touchstone Loans, also for a
security interest in the equipment. Resource Drilling defaults on both loans.
Refer to Fact Pattern 30-1B. Suppose that two weeks after Resource Drilling takes
possession of the equipment, Security Finance and Touchstone Loans file financing
statements, with Touchstone Loans filing first. In that circumstance, the party with
priority to the equipment is
a.Resource Drilling.
b.Security Finance and Touchstone Loans proportionately.
c.Security Finance only.
d.Touchstone Loans only.
11) Medical Equipment Supply Company and Natural Rehabilitation Center enter into a
contract for a lease of a certain number of wheelchairs. Medical Equipment assures the
lessee that it has valid title to the goods. Under the UCC, this type of title warranty
arises
a.automatically.
b.only if the buyer asks for such a warranty.
c.only if the seller expresses such a warranty.
d.only if the seller actually has valid title to the goods.
12) Fact Pattern 9-B1
Great Looks Clothing Corporation sends daily e-mail ads to its previous customers and
those who have opted to receive the notices. Hot Trends Inc. sends e-mail ads to any
e-mail address that Hot Trends can find on the Web or otherwise generate. Ilene sends
e-mail notes to her friends, relatives, and co-workers, discussing personal issues and
recommending products or services that she likes.
Refer to Fact Pattern 9-B1. Federal law preempts state antispam laws
a.with no exceptions.
b.except for laws that require the use of spam by business entities.
c.except for statutes that ban the use of spam altogether.
d.except for provisions that prohibit false and deceptive e-mailing practices.
13) Merry Music Inc. and Nayda enter into a contract for Nayda to write six songs for
which Merry Music agrees to pay her. Nayda transfers her right to payment under the
contract to Omni Artists Agency. In the transfer of rights, Nayda is
a.a delegator.
b.an assignor.
c.an obligor.
d.an alien.
14) Sweet Treats, Inc., wants to market a new snack food. On the product′s label,
standard nutrition facts are
a.prohibited.
b.required.
c.strictly voluntary.
d.warranted by the nature of the food.
15) Jenna files a civil suit against Keshia. To succeed, Jenna must prove her case
a.beyond a reasonable doubt.
b.by a preponderance of the evidence.
c.by indisputable proof.
d.to the extent promised in her attorney’s opening statement.
16) The least expensive method of resolving a dispute between Ronald and Sharon may
be
a.arbitration because the case will be heard by a mini-jury.
b.litigation because each party will pay its own legal fees.
c.mediation because the dispute will be resolved by a non-expert.
d.negotiation because no third parties are needed.
17) Jackson pays Phil in good faith for a promissory note. Phil warrants that the draft
has not been altered. This is
a.a presentment warranty.
b.a transfer warranty.
c.a signature warranty.
d.a breach of warranty.
18) Bernadette enters into a contract to operate a Caramel Coffee franchise, which
Caramel Coffee agrees to support as long as Bernadette maintains her business license.
Caramel Coffee’s duty to perform is
a.not a condition.
b.a condition precedent.
c.a concurrent condition.
d.a condition subsequent.
19) Hu, Ivan, and Juana apply to work for King Poultry Company. These individuals’
identities and eligibility to work must be verified by
a.King Poultry.
b.Hu, Ivan, and Juana.
c.Hu, Ivan, and Juana’s countries of origin.
d.U.S. Citizenship and Immigration Services.
20) Fresh Dairy, Inc., is the offeror and Gelato Ice Cream Company is the offeree under
a unilateral sales contract in which Hector’s Helado Corporation is also interested.
Gelato is not notified of Fresh Dairy’s performance within a reasonable time. Gelato
a.may treat the offer as having lapsed.
b.must assume that Fresh Dairy has started to perform.
c.must contact Fresh Dairy.
d.must notify Hector’s.
21) Reliable Insurance Company employs Stuart as an agent. To terminate Stuart’s
authority, Reliable Insurance must notify
a.only third parties who are aware of the agency relationship.
b.the public generally.
c.Stuart and any third parties who are aware of the agency relationship.
d.Stuart only.
22) For Melinda’s will to be valid, she must be mentally competent at the time of
a.death.
b.the acquisition of the property to be distributed under the will.
c.the making of the will.
d.the probate of the will.
23) In Coastal Fishing Company’s suit against Dockside Marina, Inc., the jury returns a
verdict in Coastal’s favor. Dockside files a motion stating that even if the evidence is
viewed in the light most favorable to Coastal, a reasonable jury should not have found
in its favor. This is a motion for
a.a judgment in accordance with the verdict.
b.a judgment on the pleadings.
c.a new trial.
d.judgment n.o.v.
24) In the ordinary course of business, Loan2Buy Corporation offers credit to Mai and
other consumers and reports on the loans to credit agencies. To save time and money,
Loan2Buy generally does not correct or update its reported information. This is most
likely to result in
a.a levy of a nominal fine.
b.an assessment of damages.
c.an order of rescission of the loan contracts.
d.no sanctions.
25) Ray buys a rural vineyard from Sergio, who claims that it would be a prime site for
a housing subdivision. Ray later learns that the law does not permit the land to be used
for housing. Ray may
a.not rescind the contract.
b.rescind the contract only if Ray did not know the law before the deal.
c.rescind the contract only if Sergio knew about the law before the deal.
d.rescind the contract only if the law is not common knowledge.
26) Sonya and Taylor enter into an oral contract that is required to be in writing to be
enforceable. Such a contract is normally
a.voidable by a party who does not wish to follow through with it.
b.void.
c.valid.
d.voidable but only by consent of both parties.
27) If, before the time for contract performance, one party clearly communicates to the
other the intention not to perform, the other party must wait to see if the repudiating
party will decide to honor the contract despite the avowed intention to renege.
28) Raconteur Data Analysis Corporation in Seattle, Washington, offers a job to Trista,
who lives in Utah. Trista orally agrees to work for Raconteur for two years. She moves
her family to Seattle and begins work. Three months later, she is fired for no stated
cause. She files a suit against Raconteur for reinstatement or pay. Raconteur pleads the
lack of a written contract. In whose favor is the court likely to rule, and why?
29) A person who signs an instrument without authorization can be held personally
liable for payment by a holder in due course.
30) If a buyer wrongfully refuses to accept goods, the seller can bring an action to
recover the damages sustained.
31) A surety is entitled to receive from the debtor the actual amount of the debt paid to
the creditor on behalf of the surety ship arrangement but not other expenses incurred.