At an auction for the first time, Dulcineabids on a one-hundred-year-old Edison-brand
phonograph, believing that it is worth more than the price asked. When the item proves
to be less valuable, Dulcinea is
a. liable on the bid.
b. not liable on the bid because Dulcinea overestimated the value of the auctioned item.
c. not liable on the bid because the auctioneer overstated the value of the auctioned
item.
d. not liable on the bid because this was Dulcineas first auction.
Economy Bank issues a letter of credit in favor of Finish & Refining Company, a U.S.
firm, to facilitate an international sales contract to buy resources from Global Mining,
Ltd., a British company.
In this letter of credit, the account party is
a. Global Mining.
b. Finish & Refining.
c. Economy Bank.
d. Great Britain.
Business Enterprise Company agrees to sell a commercial office building and parking
garage to City Investments, Inc., which assigns the rights to the realty to Downtown
Properties, LLC. Downtown Properties does not yet exist, but once itis created and
comes into existence, the contract on novation will most likely be
a. quasi.
b. voidable.
c. void.
d. enforceable.
Street Bikes, Inc., makes and sells a bicycle to Theo. Street Bikes fails to exercise “due
care to make the bicycle safe, however, and Theo is injured as a result. Street Bikes is
most likely liable for
a. market-share liability.
b. none of the choices.
c. negligence.
d. product misuse.
The Long-haul Truckers Association wants the federal government to spend funds to
build a new highway.Congress can spend revenues
a. only to carry out its enumerated powers.
b. to promote any objective that it deems worthwhile.
c. as long as the funds are spent uniformly among the states.
d. without regard to whether the expense violates the Constitution.
Julia, a world-famous chef, signs a contract to give lessons in French cooking to Kyle.
Julia wants to transfer her duties under the contract to Leila, a short-order cook at
Moms Café. The transfer is
a. valid because the performance required is of a nonpersonal nature.
b. valid if Leila is a highly regarded short-order cook.
c. not valid because performance depends on Julias personal skills.
d. not valid if Kyle does not hold Leila in high regard.
App Developers, Inc. (ADI), enters into a contract with Carmen, the chief executive
officer of SalesCorp, to create an app for the firm. To fulfill the contract, ADI hires Max
and ten other student interns. With respect to the contract, Max is
a. an intended beneficiary.
b. an incidental beneficiary.
c. a delegatee.
d. an assignee.
InfoFreeInc., makes and sells devices and services for the circumvention of encryption
software and other technological antipiracy protection. Under the Digital Millennium
Copyright Act, this is
a. a violation of copyright law.
b. prohibited but not a violation of copyright law.
c. a “fair use exception to the provisions of the act.
d. permitted for reconsideration every three years.
Omni Insurance Company violates a state licensing statute when selling an insurance
policy to Petra, in whose state Omni is not licensed to sell insurance. As a member of
the class of persons protected by the statute, Petra can
a. do nothing with respect to the policy.
b. enforce the policy or recover the amount of the premiums paid.
c. only enforce the policy.
d. only recover the amount of the premiums paid.
Global Outfitters Outlet and Hyacinth, a consumer, enter into a contract for a sale of
ultra-weather camping gear. If the contract includes a clause that is perceived as grossly
unfair to Hyacinth, its enforcement may be challenged under
a. the mirror image rule.
b. the principle of fair trade.
c. thepredominant-factor test.
d. thedoctrine of unconscionability.
Ambrose enters into a contract to buy 350 acres from Belle Vista Farms to cultivate
grapes and open a winery.
If Belle Vista breaches the contract, Ambroses remedy would most likely be
a. a certain ratio of the amount that Ambrose expected to invest in the project.
b. a percentage of Belle Vistas unrealized profit.
c. the difference between the lands contract and market prices.
d. specific performance.
At age seventeen,Daryl enters into a contract to buy a dozen movies from eHD Stream,
Inc., an online video service. Soon after reaching the age of majority, Daryl attempts to
disaffirm the contract. eHD files a suit against him. The court will most likely consider
the contract ratified if it is
a. executed.
b. exculpatory.
c. express or implied.
d. emancipated.
Bryn, Cornell, and Duke are general partners in Equity Lending, a consumer credit,
mortgage, and investment firm. Their agreement states that it is a breach of the
agreement for any partner to assign his or her interest to a creditor without the consent
of the other partners.
Cornells assignment of his interest in Equity Lendingto Financial Consultants
Corporation results in
a. nothing with respect to Cornellor Equity Lending.
b. the automatic termination of Equity Lendingslegal existence.
c. Cornells liability for all of Equity Lendingsdebts.
d. Cornells wrongful dissociation and liability for any damages.
Ballpark Sportsfield, Inc., files a suit against Concessions & Tailgate Services. The
document that informs Concessions & Tailgate that it must file an answer within a
specified time period is
a. the answer.
b. the complaint.
c. thewrit of certiorari.
d. the summons.
Dreem Land Corporation and EZ Investments Company transfer their property to
Financial Managers, Inc., which manages the property and distributes the profits to
Dreem and EZ. This form of a business organization is
a. a business trust.
b. a joint stock company.
c. a joint venture.
d. a syndicate.
When Maja, an attorney and a U.S. citizen, crosses the border between the United
States and Canada, she expects the U.S. Department of Homeland Security to search
her laptop. To avoid disclosing confidential client data during the search, Maja could
a. keep client files on a device that she does not take abroad.
b. carry client files abroad only in hard copy.
c. refuse to consent to a border search of her laptop.
d. assert her right to be free from unwarranted government intrusion.
Esmeralda promises to pay Fiorello $400 because “he does not have as much money as
other people. Esmeraldas promise isnot enforceable because
a. societydoes not want gifts cheapened by making them legally enforceable.
b. the redistribution of wealth on a one-to-one basis is nota valid social goal.
c. Esmeralda could have paid more.
d. Fiorello has not given consideration in return.
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.
Garth owns two all-terrain vehicles (ATVs), worth $1,000 and $500, respectively. Helen
agrees to buy “Garths ATV for $750. Garth believes, in good faith, that he is selling the
$500 ATV. Helen believes, in good faith, that she is buying the $1,000 ATV. In this
situation
a. Garth is entitled to $750 for the $500 ATV.
b. Helen is entitled to the $1,000 ATV for $750.
c. Helen must buy both ATVs for $1,500.
d. there is no contract.
OK Dry-Cleaning advertises so effectively that the regular customers of its competitor
Purity Cleaners patronize OK instead of Purity. This is
a. appropriation.
b. wrongful interference with a contractual relationship.
c. no tort.
d. wrongful interference with a business relationship.
As the trustee of a business trust, Bertoldi is required to
a. distribute the trusts profits.
b. assume responsibility for the trusts debts.
c. draft a written trust agreement.
d. none of the choices.
Valley Paragliders Association files a suit against Wing Designers, Inc., claiming that
the consideration for their contract is inadequate. The court will most likely not
examine the adequacy of the consideration if
a. there is a large disparity in the amount of consideration exchanged.
b. the consideration involves the performance of services.
c. something of value passed between the parties.
d. the consideration is worth less than $100.
Alainand Briesign a contract for the sale of Alains Coffee Café to Brie. The parties
intend their written contract to be a final statement of most, but not all, of the terms of
their agreementAlain must first buy the building from Developed Commercial
Properties, Inc., after which Alain and Brie will negotiate a price.
The writing that Alain and Brie signed is
a. a completely integrated contract.
b. a conditionally integrated contract.
c. a partially integrated contract.
d. a supplemental integrated contract.
Bay City Mall requires its tenants to sign a lease that includes a clause releasing Metro
from liability in the event of monetary or physical injury no matter who is at fault.
Cocos Chocolate Creations signs a lease with Bay City that contains the clause.
This clause is
a. a covenant not to compete.
b. an adhesion contract.
c. an exculpatory clause.
d. an illusory promise.
Rudyfiles a suit against Shakes & Shingles, Roofing Contractor, Inc., under the doctrine
of promissory estoppel. Rudy must show that
a. he justifiably refused to fulfill a promise to Shakes & Shingles.
b. he justifiably relied on Shakes & Shinglespromise to his detriment.
c. Shakes & Shinglesjustifiably refused to fulfill a promise to him.
d. Shakes & Shinglesjustifiably relied on his promise to its detriment.
Port Harbor City enacts an ordinance that bans the distribution of all printed materials
on city streets. Later, after the city enacts a new “revenue-enhancing measure, Quint
distributes handbills protesting that measure. When Quint is charged with violating the
printed-materials ban, he files a suit against the city arguing that the city lacked a
compelling interest in banning handbills. Most likely, the court will hold that the ban is
a. an unconstitutional restriction of speech.
b. constitutional under the First Amendment.
c. justified by the need to protect individual rights.
d. necessary to protect national interests.
Ryland, an officer for Sports Park, Inc., attempts to apply a duty-based approach to
ethical reasoning in conflicts that occur on the job. This approach is based on the idea
that a person must
a. achieve the greatest good for the most people.
b. avoid unethical behavior regardless of the consequences.
c. conform to societys ethical standards.
d. place his or her employers interest first.
Renewable Resources, Inc., files a suit against Sunrich Utility Company and seeks to
examine certain documents in Sunrichs possession. A legitimate reason for this
examination is that the documents contain
a. information that is relevant to the case.
b. private information about Sunrichs operations.
c. public information about energy generation.
d. irrelevant data that can be eliminated from consideration.
Outdoor Outfitters Store contracts to buy fifty tents from Pitched Camp, Inc. Unless the
contract states otherwise, it is assumed to be
a. none of the choices.
b. a destination contract.
c. a shipment contract.
d. a delivery ex-ship.
Bilbo signs a lease agreement for an apartment with Cato, who owns and manages the
Deer Creek Apartments complex. These parties have
a. an express contract.
b. an implied contract.
c. a quasi contract.
d. no contract.
The basis for India to give effect to the laws and court decisions of the United States is
primarily
a. courtesy and respect.
b. fear and intimidation.
c. admiration and envy.
d. payments of cash and exchanges of property.
Duffy is a passenger in a car that Caleb is driving when an accident occurs. Both Caleb
and Duffy are emotionally rattled, but neither is physically hurt. Caleb is not liable to
Dufy on a negligence theory because
a. both parties were emotionally rattled.
b. Caleb apparently did not intend to cause an accident.
c. Duffy must have been comparatively negligent.
d. Duffy was not injured.
Boutique Bodega Corporation would like to change its corporate status to that of an S
corporation to avoid income taxes at the corporate level. To qualify, the shareholders
must not be
a. corporations.
b. estates.
c. individuals.
d. partnerships.
Situations in which employers face ethical issues with respect to social media platforms
include
a. conducting an Internet search to discover what a job candidate has posted.
b. judging a job candidate based on what he or she does outside the work environment.
c. rejecting a job candidate if he or she does not participate in any social media.
d. all of the choices.
A limited liability partnership may exempt its partners from personal liability for any
partnership obligation.
Even if the terms of a contract express such certainty of performance that the promisor
has not definitely promised to do anything, the promise binds the promisor.
Because fraud actions necessarily involve wrongful conduct, courts may award punitive
damages.
A limited liability company must be managed by nonmembers.
The doctrine of quasi contract generally can only be used when there is an actual
contract that covers the matter in controversy.
A limited liability limited partnership is a type of limited partnership.
To rescind a contract, the parties must make a second agreement that satisfies the legal
requirements for a contract.
A court can exercise jurisdiction over property that is located within its boundaries.
Failure to live up to a standard of care may be an act or an omission.
An Internet service provider (ISP) is not liable for copyright infringement by its
customer unless the ISP is aware of the subscribers violation.
Commerce & Trade Corporation and Distance Shipping & Transport, Inc., form a
business trust. eCharge Auto Company and Fleet Electric Corporation form a joint stock
company. Green AgriCorp and Harvest Farms, Inc., form an incorporated cooperative.
What features do these combinations of business organization have in common?
A contract entered into by an intoxicated person is never valid.
The term fiduciary is at the heart of agency law.
Hearsay evidence is what someone heard someone else say.
Trademarks may be registered only with the federal government.
In a limited partnership, a limited partner has full responsibility for the partnership and
for all its debts.