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Mr. Green purchases a treadmill from Mr. Brown. Mr. Green tells Mr. Brown that he is
purchasing the treadmill to jog and sprint. The treadmill that Mr. Green purchases does
not allow for speeds faster than walking. Mr. Green should be able to recover his
purchase money or receive a different machine based on the UCC warrant for specific
purpose.
It is possible to create a corporation without a government's permission.
To be within the scope of employment, the agent's conduct must have been completely
motivated by the desire to serve his employer.
A partner in a trading partnership ordinarily has implied authority to borrow money for
the partnership.
The purpose behind the Model Business Corporation Act is to exploit the maximum
potential of workers in a corporation.
The professional's duty to exercise reasonable care is a subset of the negligence
standard of tort law.
When a judge's sentencing decision is challenged on appeal, the governing standard will
be one of reasonableness.
Warranties do not apply without the indorsement of the transferor.
The intent to accept is objectively demonstrated by words or conduct or a combination
of the two.
A person who at the time of the contract lacked capacity due to mental impairment can
ratify the contract once he/she regains his/her normal mental faculties.
When an offer is unclear about the form of acceptance it requires, ideally it must not be
accepted.
If Grant promises to sell his regular season football tickets to Carson on condition that
Indiana University wins the Rose Bowl, Indiana's winning the Rose Bowl is an express
condition of Grant's duty to sell the tickets.
Unlike the inventions protected by patent law, copyrightable works need not be novel.
When determining the risk of loss, it makes no difference whether the goods delivered
by the seller conform to the contract or not.
The passage of the antitrust laws reflected a congressional assumption that competition
was most likely to exist in an oligopolistic industrial structure.
According to the Magnuson-Moss Warranty Act of 1975, a consumer is a buyer or
transferee who either uses the product himself or sells it to another consumer.
Courts will always enforce an exculpatory clause from a properly executed contract.
The Fifth Amendment guarantees indigent defendants the right to court-appointed
counsel.
The do-not-call registry is unconstitutional because it discriminates and does not apply
to charitable and political callers.
The EPA bears the primary responsibility for the siting and regulation of solid waste
disposal.
The Federal Trade Commission's (FTC) principal mission is to ensure that the economy
is free and fair.
The term estate is the reference to an individual's interest in a real property.
The World Intellectual Property Organization is a leading provider of conciliation for
bad faith action.
One partner leaving a limited partnership will not cause the partnership to be dissolved.
In 1990, Revised Article 3 of the UCC was developed, which now has been adopted by
all the states.
Article 9 of the Uniform Commercial Code deals with provisions regarding security
interests involved in personal property.
In case of a dispute between the common law and a precedent that has been properly
distinguished, the common law prevails.
Normally, a motion for summary judgment requires that a court decide there are
genuine questions of fact and questions of law.
A fee simple absolute gives a person the right to possess and use property for a time
measured by his or another person's lifetime.
Authority is an agent's ability to handle the legal issue of a principal.
If a buyer accepts a part of a commercial unit of goods, he is considered to have
accepted only that part of the unit.
When determining whether a manufacturer was negligent in adopting a particular
design, courts frequently supplement the above factors with an analysis known as the
utilitarian test.
Consideration on an insurance contract is the premium paid by the individual being
insured and the promise by the insurance for future coverage in the event of a peril.
According to Revised Article 3 if a bank pays a check that contains a forged
indorsement:
A. the bank has converted the check by wrongfully paying it.
B. the person whose indorsement was forged has converted the check.
C. the person whose indorsement was forged is liable to the bank.
D. the forger is liable to the person whose indorsement was forged.
Congress enacted the Freedom of Information Act (FOIA) to enable private citizens to
obtain access to documents in the government's possession.
Humorous or satirical accounts ordinarily are not considered to be defamation unless:
A. a reasonable reader believes them to be real events.
B. they are political in nature.
C. the plaintiff can prove that they are about him/her.
D. they expressly state so.
One of the differences between fraud and misrepresentation is that:
A. there is a requirement of materiality in fraud cases.
B. in fraud cases, the injured party has the option of suing for monetary damages.
C. misrepresentation requires scienter.
D. a false statement of opinion cannot be the basis for a claim of misrepresentation.
Boris borrowed Martha's lawnmower to cut his grass. Boris will be liable for damage to
the lawnmower if he:
A. owns a lawnmower and borrowed another from Martha.
B. has not given Martha any consideration.
C. did not use greater than ordinary care to protect it.
D. he is sued by Martha.
Ms. Bunny has been denied disability by the Social Security Administration (SSA). In
her denial letter it indicates she has the right to an appeal before an agency law judge.
Ms. Bunny decides to sue in district court. Her case will likely be dismissed for failing
to be ripe.
Mike, a minor, buys some real estate as investment. The contract obligates Mike to
make monthly installment payments for 10 years. Mike reaches the age of majority one
month after making the contract. After this, Mike makes 25 monthly payments under
the contract, but then decides that he wants to rescind the deal. Which of the following
is most true?
A. Mike can disaffirm.
B. Mike cannot disaffirm because contracts for the sale of land can only be disaffirmed
before the age of majority.
C. Mike cannot disaffirm because contracts for the sale of land must be disaffirmed
within one year of the age of majority.
D. Mike cannot disaffirm because he has already ratified the contract.
Justin agrees to start a life-size portrait of Julia beginning 2nd November. On the 28th of
October he writes to Julia that due to unforeseeable circumstances he would not be able
to perform his promise, Justin has used the doctrine of:
A. accord and satisfaction.
B. anticipatory repudiation.
C. specific performance.
D. quasi-contract.
In January 2003, Evan sold a television set that he stated was "HDTV ready" to Zora.
Three months later, Zora learned that the television set was not "HDTV ready." For
each of the three major views on the "part of the basis-of-the-bargain" requirement for
express warranty liability under UCC Section 2-313, explain what the court will need to
know before making a decision.
Cey Corp. entered into a contract to sell parts to Deck, Ltd. The contract provided that
the goods would be shipped "FOB Cey's warehouse." Cey shipped parts different from
those specified in the contract. Deck rejected the parts. A few hours after Deck
informed Cey that the parts were rejected, they were destroyed by fire in Deck's
warehouse. Cey believed that the parts were conforming to the contract. Which of the
following statements is correct?
A. Regardless of whether the parts were conforming, Deck will bear the loss because
the contract was a shipment contract.
B. If the parts were nonconforming, Deck had the right to reject them, but the risk of
loss remains with Deck until Cey takes possession of the parts.
C. If the parts were conforming, risk of loss does not pass to Deck until a reasonable
period of time after they are delivered to Deck.
D. If the parts were nonconforming, Cey will bear the risk of loss, even though the
contract was a shipment contract.
The First Amendment provides that "Congress shall make no law … abridging the
freedom of speech." What is often described as being at the "core" of the First
Amendment?
A. Commercial speech
B. Artistic speech
C. Advertisements
D. Political speech
Lee, a landlord, hires Shomo, a repairman, to fix a broken staircase in the house
occupied by his tenants, the Grants. However, Mrs. Grant has an accident while
climbing down the stairs and injures herself severely. It was found that Shomo had not
fixed the staircase properly, which caused this accident. Which of the following is true
of this situation?
A. The Grants can file a lawsuit against Shomo, since Shomo was an agent and did not
perform his duties properly.
B. Lee will be held liable under the doctrine of respondeat superior for the
non-performance of Shomo.
C. The Grants can hold Lee directly liable for Shomo's tortious behavior, since Shomo
was Lee's employee.
D. Lee will be held directly liable for Shomo's failure to perform, since Shomo was
Lee's nonemployee agent.
Which of the following is true of the Code's rules on title to goods?
A. Buyers may reject the goods and yet keep title to them.
B. Sellers are less important title holders to the goods in a contract.
C. Parties cannot use a negotiable document of title for professional carriers.
D. Title passes to a buyer only when the seller performs his duties completely.
N-Ext Corp. (NEC) was defectively organized. As a result, even a corporation by
estoppel could not be formed. As representatives of NEC, Pete (a shareholder manager)
and Dave (a nonshareholder manager) made a contract with a vendor for supplying raw
materials to NEC. The vendor did not get paid as per the contract. Who is liable in this
situation?
A. NEC
B. Dave and NEC
C. Pete, Dave, and the management of NEC
D. Pete and NEC
Cases in administrative proceedings are heard by a(n):
A. adjudicating chairperson.
B. administrative law judge.
C. executive judge.
D. judicial commissioner.
The _____ was the first administrative agency created by Congress.
A. Interstate Commerce Commission
B. Occupational Safety and Health Administration
C. Food and Drug Administration
D. Internal Revenue Service
The Fair Labor Standards Act (FLSA) regulates wages and hours by entitling covered
employees to a time-and-a half rate for work exceeding _____ hours per week.
A. 55
B. 50
C. 45
D. 40
When Tammy rented an apartment, she and the landlord agreed that she would pay rent
on the first of every month. However, they did not agree on the duration of the lease.
Under these circumstances, what sort of tenancy was created?
A. A tenancy at will
B. A tenancy at sufferance
C. A periodic tenancy
D. A fee simple tenancy
Termination of the agency relationship at the option of the principal is known as _____.
A. revocation
B. renunciation
C. falsification
D. liquidation
Under the 1933 Act, which of the following is allowed to state the price at which the
securities will be offered?
A. A notice about a prospective offering published during the pre-filing period
B. A tombstone ad
C. A free-writing prospectus
D. A preliminary prospectus
The two most common classes of shareholders are:
A. Government and common
B. Common and preferred
C. Preferred and government
D. Watered down and common
In which of the following situations can a buyer revoke acceptance of nonconforming
goods?
A. The buyer accepted them with the knowledge of the nonconformity, because they
were the only option available in the market.
B. The buyer accepted the goods because of the seller's assurances that it would cure
the defect.
C. The price of the goods fell in the general market.
D. The buyer accepted the nonconforming goods because the seller couldn't cure the
defect.
Which of the following characterizes a tenancy in common?
A. Each tenant has equal right to possess and use the property.
B. The tenants must be a married couple.
C. It grants the right of survivorship.
D. Tenants are not allowed to divide the property.
Even though no one else had developed an invention like that of the patent applicant,
the application will be denied if, at the time of the invention, the invention would have
been obvious to a person having ordinary skills in the area.
Not-for-profit corporations are regulated primarily by the:
A. states.
B. federal court.
C. federal government.
D. Supreme Court.
Property insurance policies are in the nature of:
A. partnership contracts.
B. negotiation contracts.
C. indemnity contracts.
D. lease contracts.
Northern Company is a small issuer who wishes to solicit investors to buy its securities
during the pre-filing period. As the advertising budget of the company is not large,
Northern has decided to advertise during the pre-filing period by using a Website. This
solicitation of shares is:
A. in violation of the Prohibition of Solicitation Act.
B. permitted as the Internet has strong potential for attracting investors.
C. in violation of Rule 505 and Rule 506 of Regulation D.
D. allowed provided SEC gives written permission.
What form of liability exists when a party is only responsible to pay on a negotiable
instrument in case of default of the party who shoulders the obligation of liability for
the instrument?
A. Primary Liability
B. Secondary Liability
C. Accidental Liability
D. International Liability
Who amongst the following owes a fiduciary duty to the corporation?
A. Directors
B. Employees
C. Shareholders
D. Secretary of state
Which of the following characterizes emancipation?
A. It allows parents to receive services from the child.
B. It occurs only through parents' consent.
C. Most states grant an emancipated minor the capacity to contract.
D. There are no formal requirements for it.
The means test is designed to determine the:
A. debtor's ability to repay general unsecured claims.
B. creditor's ability to recover unpaid claims from the debtor.
C. court's ability to guarantee exemptions for the debtor.
D. government's ability to bar corporations from availing the provision of discharge of
debts.
Which of the following is most likely to constitute undue influence?
A. A firm demanding more in terms of pricing by withholding essential supplies.
B. A clergyman using a parishioner's emotional susceptibility to get the parishioner to
contract with the clergyman.
C. Threatening to commence a frivolous criminal prosecution against someone, in order
to get them to contract with you.
D. Grabbing someone's hand and forcing them to sign on a contract you have prepared.
Amanda and Sally are close friends who form a limited partnership to open a salon.
They refuse to put a buyout clause for withdrawing partners in the limited partnership
agreement, assuming that their friendship and business will last forever. Amanda, as a
general partner, contributes $100,000 and Sally, as a limited partner, contributes
$125,000. Two years later, Sally accuses Amanda of falsifying the data and withdraws
from the limited partnership. How much will Sally receive from the limited
partnership?
A. $125,000
B. $10,000
C. $100,000
D. $0
The Environmental Protection Agency (EPA) sets a "primary standard" for air pollution.
This standard is designed to protect against harm to:
A. human health.
B. animal health.
C. plant health.
D. climate health.
Under the Model Business Corporation Act (MBCA), shareholders have a qualified but
not absolute right to inspect:
A. the articles of incorporation and bylaws.
B. an alphabetical listing of the shareholders entitled to notice of a meeting.
C. the number of shares owned by the shareholders.
D. shareholder minutes more than three years old.
Briefly discuss the four tests courts use to determine if an employee's conduct was
within his or her scope of employment.
Mike contracts with Bob to purchase Bob's boat. Mike promises to pay Bob $5,000
upon delivery of the boat to Mike's beach house. Bob arrives at Mike's house without
the boat, and demands full payment before the boat is to be delivered. Is Mike obligated
to pay Bob the money? Why or why not?
Karla retires from Orton Associates, a partnership. The business is continued by the
remaining partners and Wes, a new partner who has agreed to assume Karla's liability
for partnership obligations. Creditors have not been notified of Karla's retirement. What
are Karla's and Wes's liabilities to the creditors?
In entering into contracts for services, customers might be influenced by statements
made by sales representatives. Businesses offering services often use standardized form
contracts. Under the parol evidence rule, pre-contract statements made in these
circumstances are effectively unenforceable. How can a business effectively and
ethically use standardized form contracts and the parol evidence rule?
What are the various ways through which a corporation can be dissolved?
The Ace Corporation is involuntarily petitioned into a Chapter 7 bankruptcy on March
1, 1994. On January 10, 1994, Ace paid the Highstate Gas Company its $1,700 utility
bill for natural gas supplied during December of 1993. Is this payment preferential?
Why or why not?
Mr. White contracts with Mr. Green for 100 black coffee mugs for a party. Mr. White
decides he needs the mugs faster than the time allotted in the contract, and asks for a
rush shipment. Mr. Green notifies Mr. White that he will ship 100 coffee mugs but that
the only ones available are red. A court will find that the shipment of red mugs under
the UCC is not a breach of the original agreement.
Homeowner Ann Jameson entered into a 90-day exclusive right to sell listing agreement
with a real estate broker, Bill Boor. One week later, Jameson sold the house to her
neighbor, Jerry Mateo, who learned that the property was for sale when he saw the "for
sale" sign in Jameson's yard. Boor contends that he is entitled to a commission on the
sale. Is Boor entitled to a commission? Why or why not?
Dee sues Gerry for defamation. Dee thinks that the facts clearly are not as stated in
Gerry's complaint and that, given Dee's version of the facts, Gerry cannot recover for
defamation. What motion gives Gerry the best chance of winning the case early? What
does it involve?
In general, settlements of liquidated debts are not binding due to the absence of
consideration, while settlements of unliquidated debts are a binding accord and
satisfaction. As a matter of technical consideration law, what justifies this distinction?
Owen once owed Carl a $1,000 debt, but the statute of limitations ran on that
obligation, discharging Owen. Later, Owen promises in writing to pay Carl the debt.
Why is there no consideration for this promise? Why is it binding anyway? What
additional requirement do some states impose to make the promise binding?
Describe the different approaches taken to transnational insolvencies. What is the
approach taken currently?
Amber Blue owns a small hotel of the "bed & breakfast" variety. Hunter Greene, a
tenant at Blue's bed & breakfast, sustained severe physical injuries when an intruder
broke into Greene's room and attacked him with a baseball bat. The intruder neither was
an employee of Blue's nor otherwise had any connection with the bed & breakfast.
Green filed a tort action against Blue in an effort to collect damages for the medical
expenses, lost earnings, and pain and suffering he experienced as a result of the
intruder's attack. Greene argued that owners of commercial property such as a bed &
breakfast are liable, as a matter of law, whenever guests are injured while on the
premises. Blue argued that such property owners cannot be held liable when the guest's
injuries were directly (and criminally) inflicted by a third-party attacker. Evaluate the
arguments made, respectively, by Greene and Blue. Explain your supporting reasoning.
The term Parol Evidence means that outside conversations cannot be used to add or
modify a completely integrated contract.
Joe has recently learnt about the Privacy Act of 1974 from his friend Shawn. That has
reassured him that his personal tax documents available with the Internal Revenue
Service are unlikely to be disclosed by IRS to third parties without his written consent.
Is Joe right?
Jill Homeowner contracts with Ralph Roofer for Ralph to reshingle Jill's roof. Midway
through the job, Ralph says that he cannot finish unless Jill promises to pay him an
additional $500. There is no real basis for this demand; Ralph just wants more money.
Even though she could have gotten one of six other roofers to finish the job at a
reasonable price, Jill gives in and promises to pay the $500, after which Ralph
completes the job. Later, Jill refuses to pay the additional $500, and Ralph sues her. Jill
defends on the basis of duress. What are the chances of this defense working?
