Seymour borrows $350,000 from Reliable Bank to buy a home. Seymour stops making
payments on the loan ten months later. After the bank repossesses the property securing
the loan but before it is sold, Seymour wants to buy it. This is
a. a deficiency judgment.
b. a reverse mortgage.
c. a violation of the law.
d. the right of redemption.
In making a decision as chief executive officer of Straightarrow Archery Supplies,
Robin always considers whether he would feel any guilt about a particular action. As a
guide, Robin is using
a. the categorical imperative.
b. internal company policies.
c. the law.
d. his conscience.
Dru signs a check “pay to the order of Eppie” drawn on Dru’s account in Bayside Bank.
Greta forges Eppie’s indorsement. Bayside pays the check. Most likely
a. Dru will be liable for the amount.
b. Eppie will have to pay Dru for the amount.
c. Bayside will have to recredit Dru’s account.
d. the Federal Reserve will reimburse all parties for their costs.
Popular Movies Corporation wants to gain control of Quality Films, Inc. The companies
negotiate for several months, without coming to terms. Popular Movies decides to
pursue a takeover attempt. Quality Films decides to resist.
Quality Films issues shares that its shareholders can exchange for cash if a takeover is
successful, intending to make Popular Movies’s takeover attempt too expensive. This is
a
a. crown jewel defense.
b. Pac-Man defense.
c. poison pill defense.
d. white knight defense.
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.
Mitchell orally agrees to pay Lorena to plant and harvest a quarter of Mitchell’s farm
acreage for four soybean seasons. After Lorena prepares the land and plants the first
crop, Mitchell says that their deal is off. Lorena can most likely recover
a. in quasi contract.
b. nothing.
c. in restitution.
d. on the parties’ existing contract.
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.
Jack owns the surface rights for Rocky Ridge Ranch, but does not own the subsurface
rights. Ginny owns the subsurface rights. Rocky Ridge Ranch has a historic barn, which
is damaged when Ginny is excavating minerals from the ranch. Who is most likely
responsible for the damage to the barn?
a. Ginny only
b. Jack only
c. Ginny and Jack
d. no one
Global Services Corporation engages in trade practices that may violate antitrust law.
The Federal Trade Commission has the power to act against unfair trade practices under
a. the Clayton Act.
b. the Federal Trade Commission Act.
c. the Sherman Act.
d. no law.
Rocko owes Sybil $1,000 for yard work Sybil performed for Rocko. The money is due
on May 1. On April 30, Rocko goes to the bank to get the money and discovers that the
bank will be closed until May 2. Rocko
a. will be in breach of contract when he fails to pay Sybil on May 1.
b. will not be in breach of contract when he fails to pay Sybil on May 1 due to objective
impossibility.
c. is discharged from any contractual liability to Sybil.
d. will not be in breach of contract when he fails to pay Sybil on May 1 as long as he
pays the $1,000 plus ten percent interest on May 2.
Fresh Cream, Inc., wants to make an initial public offering of securities. Fresh believes
that it qualifies for an exemption under Regulation A from the full registration
requirement of the federal Securities Act of 1933.
If Fresh is exempt from the federal registration requirement, Fresh is
a. automatically exempt from any state registration requirement.
b. not subject to any state securities laws.
c. not necessarily exempt under a state registration requirement.
d. automatically subject to all state registration requirements.
Jo files a suit against Lara in a Missouri state court. Lara’s only connection to Missouri
is an ad on the Web originating in Nebraska. For Missouri to exercise jurisdiction, the
issue is whether Lara, through her ad, has
a. a commercial cyber presence in Missouri.
b. conducted substantial business with Missouri residents.
c. general maximum contact with Missouri.
d. solicited virtual business in Missouri.
Daphne defaults on a debt to Country Loan Corporation (CLC). As a creditor, CLC can
place liens on all of Daphne’s property except
a. motor vehicles used to commute to work.
b. stock in various corporations.
c. items that the debtor selects.
d. vacant commercial property.
Lora files a suit in Michigan against Ned over the ownership of a boat docked in a
Michigan harbor. Lora and Ned are residents of Ohio. Ned could ask for a change of
venue on the ground that Ohio
a. has a sufficient stake in the matter.
b. has jurisdiction.
c. has sufficient minimum contacts with the parties.
d. is a more convenient location to hold the trial.
Algorhythm Stock Trades, Inc., and Big Data Market Analyses, Inc., plan to merge.
Most likely, the articles of merger will be filed with
a. the county recording office.
b. the local chamber of commerce.
c. the state’s secretary of state.
d. the Securities and Exchange Commission.
The Federal Emergency Management Agency (FEMA) discovers that Goodnuff
Trailers, Inc., is violating a FEMA regulation. If this situation is resolved like most such
disputes, the outcome will be
a. a negotiated settlement.
b. a trial and a fine.
c. a trial and an appeal to a higher authority.
d. a trial and the dissolution of the business.
Scott, a State Bank employee, deposits into his account checks that are given to him by
bank customers to deposit into their accounts. This is
a. embezzlement.
b. larceny.
c. money laundering.
d. no crime.
Cal sells “DownSize,” a weight-reduction program, from a Web site, in competition
with Eat-Less Inc.’s product “Fit “n Trim.” Eat-Less files a suit against Cal, alleging in
part that he is a sole proprietor, but his enterprise should be deemed a different form of
business. Cal’s enterprise should most likely be considered
a. a corporation because DownSize is sold online.
b. a franchisee because DownSize is sold in competition to Fit “n Trim.
c. a sole proprietorship because Cal is a sole proprietor.
d. no form of business entity because Cal has no formal organization.
Tom and Bill are partners in Tough Trucks Towing. James is not a partner. In dealing
with Fred, James holds himself out to be a partner in Tough Trucks Towing and Fred
contracts to have Tough Trucks Towing tow some vehicles for him. If Tough Trucks
fails to tow the vehicles, a court may conclude that
a. a partnership by estoppel exists and James is liable to Fred.
b. no partnership exists and James is not liable to Fred.
c. a partnership by estoppel exists and Fred has all partnership rights.
d. no partnership exists, but Tom and Bill are liable to Fred.
Tami’s Tasty Tacos, a fast food outfit, files a suit against the state of Texas, claiming that
a Texas state law violates the commerce clause. The court will agree if the statute
imposes a substantial burden on
a. a local government.
b. interstate commerce.
c. noneconomic activity.
d. the state.
Juli types onto a computer what she intends to be “My Will” and prints it out. Juli has
capacity. “My Will” is
a. invalid.
b. valid if Juli signs it.
c. valid if Juli signs it and has three witnesses sign it.
d. valid if Juli signs it, has three witnesses sign it, and files it in a certain state office.
Odina signs a covenant not to compete with her employer, Penultimate Sales
Corporation. A court decides that the covenant is overly restrictive. The court will likely
a. enforce it as written so as not to undercut the freedom of contract.
b. enforce it but evaluate its effects over time.
c. reform its terms to prevent any undue burden.
d. refuse to enforce it unless Penultimate pays additional consideration.
Trademarks are protected from use on noncompeting goods by
a. the Federal Trademark Dilution Act.
b. the America Invents Act.
c. the Anticybersquatting Consumer Protection Act.
d. the Copyright Act.
Jean is playing a video game on a defective disk that melts in her game player, starting
a fire that injures her hands. Jean files a suit against K-Tech, Inc., the game’s
manufacturer. K-Tech is held liable under the doctrine of strict liability. A significant
application of this doctrine is in the area of
a. cyber torts.
b. intentional torts.
c. product liability.
d. unintentional torts.
Toyoda Company buys gas pedals and other parts from suppliers and puts them in its
vehicles without changing their composition. If the pedals or other parts are defective,
strictly liable for any damage caused by the defects are
a. neither Toyoda nor the suppliers.
b. Toyoda and the suppliers.
c. the suppliers only.
d. Toyoda only.
Ozzy is an officer of Prudent Financial Corporation. Ozzy serves in a representative
capacity for Prudent Financial’s owners. With respect to binding Prudent Financial to
contracts, Ozzy is
a. an agent and has the authority.
b. an agent but does not have the authority.
c. not an agent and does not have the authority.
d. not an agent but does have the authority.
Industrial Engineering, Inc., promises to give stock options to Jasmine for processes she
has already designed for the firm. This promise is enforceable
a. because it is a new contract.
b. because it is an illusory promise.
c. because it is supported by past consideration.
d. under no circumstances.
Double D Ranch and Esau enter into a contract on August 1 for the sale of 200 cattle.
Esau cancels the contract ten days later. Double D is unable to sell the cattle to another
buyer. Double D is entitled to
a. force Esau to accept the cattle and recover the contract price.
b. keep the cattle and recover the contract price from Esau.
c. keep the cattle only.
d. recover the contract price from Esau but must destroy the cattle.
Raven is a shareholder of Quantum Mechanix Corporation. Raven could normally
exercise appraisal rights if Quantum participated in
a. a consolidation.
b. a dissolution.
c. a liquidation.
d. a winding up.
Kelly signs an instrument in favor of Leo that states it is “subject to a certain agreement
between Kelly and Mona.” This instrument is
a. negotiable.
b. nonnegotiable, because it is made subject to a separate agreement.
c. nonnegotiable, because it refers to a separate agreement.
d. nonnegotiable, because Kelly and Mona are not the same persons.
Peter and Ray are riding their horses together. Peter jokingly tells Ray that Ray’s horse
is too slow. Ray laughs and jokingly responds “Yes, he is too slow! I would sell him for
$5!” Peter hands Ray $5. This is
a. a valid acceptance because Peter gave Ray the money in a reasonable time.
b. a valid acceptance because there is consideration on both sides.
c. not a valid acceptance because Ray’s offer was made in jest.
d. not a valid acceptance because Ray’s horse is worth more than $5.
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.
Constructive delivery satisfies the delivery requirement for an effective bailment.
The officers and other employees of each corporation involved must approve a share
exchange plan.
Sunn Energy, Inc., needs funds to meet its payroll, to make other current operating
expenses, and to pay its creditors. Terence, Sunn’s only shareholder, loans the company
$100,000 and accepts a promissory note signed on behalf of Sunn by Ulrich, the firm’s
accountant. Sunn’s financial problems continue, however, and the firm’s creditors file an
involuntary petition to force it into bankruptcy. Is Terence entitled to repayment of the
loan to Sunn? If so, what is the priority of the claim?
Most limited liability company statutes have no provisions regarding members’
meetings.
Expenses that are caused directly by a breach of contractsuch as those incurred to
obtain performance from another sourceare compensatory damages.
International Exports, L.P., is a limited partnership, with $100,000 in declared but
unpaid profits. International’s creditors include Friendly Credit Corporation for $5,000
and Gwen, one of International’s limited partners, also for $5,000. When Harry, one of
International’s general partners, decides to retire, the other general partners vote to
liquidate and dissolve the firm. The limited partners, who are not asked their opinions,
want International to continue in business and file a suit against the general partners to
compel this result. Can the court order International to continue? If not, what is the
priority of the distribution of International’s assets on its dissolution?
An executor is a personal representative appointed by a court for a decedent who dies
without a will.
Under rules of professional misconduct, an attorney should not engage in conduct
involving deceit.
Special requirements must be met to discharge toxic chemicals into surface waters.
Dennis is a promoter for the soon-to-be-incorporated firm of eBroadcast Sports, Inc.
Dennis signs a contract with Fitz & Geraldo, Accountants, to render their services
before eBroadcast Sports is incorporated and for one year after the incorporation.
eBroadcast Sports is incorporated. Three months later, after Fitz & Geraldo has
continued performing under the contract, the eBroadcast Sports board of directors tells
the accountants that it is canceling their contract. Fitz & Geraldo files a suit against
Dennis and eBroadcast Sports, alleging breach of contract. Will Fitz & Geraldo prevail?
A life insurance contract involves an intended beneficiary.
Most bailments are created by agreement, but not necessarily by contract.
Rubber stamp signatures can be legally binding signatures.
Administrative agencies cannot make legislative rules, or substantive rules, that are as
legally binding as laws that the Congress passes.
State employers are not immune from private suits brought by employees under the Age
Discrimination in Employment Act of 1967.
A right can be assigned even if the assignment will significantly alter the risks or duties
of the obligor.