Legislative reform at both the state and federal levels have facilitated e-commerce by
revising traditional contract rules to include new contract rules for electronic
transactions made over the Internet.
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To make a third party a donee beneficiary, the creation of a gift (intended for the third
party) of the contracted performance must be the promisee’s primary purpose in
contracting.
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Crimes are private wrongs, pursued by private attorneys.
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An illegally paid dividend may be recovered from a shareholder who received it with
knowledge of the illegality.
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The function of bylaws is to establish rules for the conduct of the internal affairs of the
corporation.
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Anyone who buys the interest of an LLP partner is automatically a partner.
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To recover for negligent infliction of emotional distress as a third party, the plaintiff
does not always have to establish some physical symptoms resulting from the said
distress.
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Constructive eviction enables a tenant to terminate the lease on a property because she
has effectively been evicted as a result of the poor condition or the objectionable
circumstances there.
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Agents may use the formulas, processes, and mechanisms they have acquired while
employed by their principal to benefit themselves.
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A bank may pay a postdated check unless it has received notice from the customer not
to pay until the instrument’s date.
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A person who is primarily liable has agreed to pay the negotiable instrument.
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Between the agent and the principal, it is the principal who is ultimately liable for the
acts of the subagent.
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A person’s promise made on an original contract is identical to the promise a third party
makes on a guaranty contract.
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The legal effect of the agent’s action on behalf of the principal is usually the same as if
the principal had done the act.
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The “Restatement (Second) of Contracts” carries the force of law.
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When issuing a stop-payment order, banks claim that the “reasonable certainty” with
which customers must describe the check in question should have the dollar amount
exact to the penny because the computers they program require such precision.
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Mediators make decisions based on the merits of a dispute.
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The court is most likely to find a disclaimer of warranty unconscionable:
A. if the goods sold “as is” or “with all faults” are sold without any warranties.
B. if the the plaintiff is a merchant trying to recover for property damage or economic
loss.
C. if the disclaimer is conspicuous.
D. in the case of a personally injured consumer.
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“One who waits too long to complain has indicated satisfaction with the agreement
despite the initial lack of TRUE consent” is the idea behind the doctrine of:
A. ratification.
B. forbearance.
C. rescission.
D. emancipation.
Answer:
Robert files a case against Richard for non payment of dues. Before the trial, Richard is
examined under oath in the presence of Robert’s attorney. What is this process of
examination known as?
A. Deposition
B. Discovery
C. Pretrial conference
D. Default judgment
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“COD” stands for:
A. cash on delivery.
B. cargo on date.
C. certificate of deposit.
D. cash on details.
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What is the term used for the willingness of adults who indicate an intent to be bound
by contracts entered while still minors?
A. Ratification
B. Disaffirmance
C. Emancipation
D. Forbearance
Answer:
Identify the statement which is TRUE of Rule 10b-5.
A. Securities need not be registered under the 1933 Act or the 1934 Act for Rule 10b-5
to apply.
B. The rule applies only to transactions executed on a securities exchange.
C. The rule applies only to face-to-face transactions.
D. A misstatement or omission of material fact, scienter, and reliance are not elements
of Rule 10b-5.
Answer:
The new federal sentencing guidelines implemented as part of Sarbanes-Oxley:
A. apply both to individual board members and the corporation itself.
B. assign specific oversight responsibilities to directors.
C. are designed to give management immunity.
D. call for special committees of the board to be assigned similar functions.
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An incidental beneficiary can:
A. sue for nonperformance.
B. acquire rights under the contract.
C. enforce the contract.
D. be a member of the general public.
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When parties to an oral contract have both fully performed their obligations under the
contract, the parties are:
A. allowed to rescind the contract.
B. not allowed to rescind the contract.
C. allowed to seek compensatory damages.
D. not allowed to recover the value of performance.
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A minor’s contract for necessaries is:
A. unenforceable.
B. estoppable.
C. voidable.
D. binding on a quasi contract theory.
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When a contracting party runs into unforeseeable difficulties that make his/her
performance impossible, courts will:
A. not enforce a modification that is not supported by new consideration.
B. prosecute the contracting party on criminal charges.
C. enforce a modification in the interest of fairness.
D. will make the contracting party pay up in full.
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A bankrupt person’s estate is administered by ___.
A. the creditors
B. the creditors’ committee
C. the trustee
D. the bankruptcy judge
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People who contract to furnish labor or materials to improve real estate:
A. can claim a lien on the property until they are paid.
B. cannot claim any lien on the property.
C. can claim any lien on a property irrespective of statutory requirements.
D. cannot foreclose their lien on the property.
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The Equal Employment Opportunity Commission:
A. permits mandatory binding arbitration as a condition of employment.
B. can initiate action under Title VII on its own.
C. is not supportive of alternative dispute resolution.
D. is based on the laissez-faire values of the 19th century.
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Generally, the role of appellate courts is to:
A. review the proceeding in the trial court and correct legal errors made by the trial
judge.
B. accept the findings of the trial court with minor changes even if it goes against all the
evidence.
C. hear witnesses once again and establish new facts.
D. review all proceedings in the trial court and penalize the trial court judges for wrong
decisions.
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The same statement regarding a product might be interpreted as either an opinion or an
express warranty depending on:
A. whether the contract is oral or written.
B. the relative knowledge of the parties involved.
C. whether the contract contains a disclaimer.
D. the type of goods or services dealt with.
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Which of the following statements is TRUE?
A. Personal service contracts, like all contracts, terminate with the promisor’s death.
B. Personal service contracts are the only contracts which terminate with the promisor’s
death.
C. Personal service contracts are the only contracts which cannot terminate with the
promisor’s death.
D. Personal service contracts can terminate under any circumstance.
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If a partnership has been dissolved in violation of the partnership agreement:
A. the court, by itself, liquidates the assets of the business.
B. the court appoints a representative as receiver to wind up the business.
C. the remaining partners forfeit the right to wind up the business.
D. the innocent partners have the right to liquidate the partnership assets.
Answer:
Which of the following prohibits the federal government from depriving any person “of
life, liberty, or property, without due process of law”?
A. The Fifth Amendment Due Process Clause
B. The Commerce Clause
C. The Fourteenth Amendment Due Process Clause
D. The Seventh Amendment
Answer:
Under the UCC Rule 2-207 for the sale of goods when a contract is made by the
exchange of forms, when the acceptance form has terms additional to or different from
the offer:
A. no contract will result because the acceptance form will be considered as a
counteroffer and thus an implicit rejection of the offer.
B. a contract can result, but the differing terms may not be part of the contract.
C. a contract can result, and the differing terms must be included as part of that
contract.
D. no contract will result because the acceptance form will not be considered as a
counteroffer.
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According to the concept of ____, a 13-year old accused of shoplifting cannot be
convicted.
A. infancy
B. insanity
C. premeditation
D. intoxication
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The most common way of perfecting a security interest is by:
A. automatic perfection.
B. filing a financing statement in the appropriate public office.
C. posting private notice of the interest.
D. mere attachment of the security interest.
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If an instrument is payable to the order of a specific payee, it is called a(n):
A. order paper.
B. bearer paper.
C. cashier’s check.
D. teller’s check.
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How can a copyright holder recover under the theory of contributory copyright
infringement?
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Name the kinds of contracts courts often hold to be illegal because they violate public
policy.
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An underground water main burst in Manhattan and flooded the building where the
Acme electric company has an electricity supply substation. A fire resulted and
disrupted electric power for four days. This occurred during the biannual “Buyers
Week” when merchandisers from around the world were in town to visit fashion
showrooms and place orders for future seasons. Some 200 merchandisers brought suit
against Acme. Some of the businesses had no direct contractual relationship with Acme.
They argued that their lease agreements with their landlords, who were the direct
contracting entities with Acme, obligated them to pay a share of the electricity expenses
and therefore they could sue under the contracts between the landlords and Acme. Are
they correct?
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Explain personal defenses against the payment of negotiable instruments. Give suitable
examples.
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Title VII prohibits quid pro quo sexual harassment involving some express or implied
connection between the employee’s submission to sexually-oriented behavior and job
benefits. What other type of sexual harassment does Title VII prohibit?
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Explain forbearance to sue in relation to consideration.
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What is a quasi-contract?
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Why are property insurance policies generally nonassignable?
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What are the factors that influence the reasonable length of an offer?
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Myron bought a valuable painting from Williams and paid for it with a bad check.
Myron then sold the painting to Olive, who paid a large sum of money for it and who
did not know that Myron had bought it with a bad check. Can Williams recover the
painting from Olive? Why or why not?
Answer: