The crime of involuntary manslaughter is an intent crime.
The lawfulness of government classifications that do not involve suspect or protected
classes is examined using an intermediate scrutiny test.
Adhering to a company’s code of ethics is a form of ethical fundamentalism.
The Federal Trade Commission Act (FTC Act) was enacted in 1970.
An acceptance is “a manifestation of assent by the offeror to the terms of the offer in a
manner invited or required by the acceptance, as measured by the subjective theory of
contracts.”
Many contracts involving gambling are considered to be illegal contracts.
In a case of unfinished goods, the seller or lessor may choose to complete the
manufacture of the goods and resell, release, or otherwise dispose of them to another
party.
In terms of the requirements for becoming a holder in due course, “good faith” means
honesty in fact in the conduct or transaction concerned.
An agreement requires an offer by the offeror and an acceptance of the offer by the
offeree.
The United States Congress initially authorized the development of limited liability
companies.
In making an offer, the offeror promises to do or refrain from doing something.
“Rule 144” provides that securities sold pursuant to the “private placement” or ‘small
offering” exemption must be held for six months from the date when the securities are
last sold by the issuer.
An I.O.U. is another form of note that is considered to be a promise to pay.
Under contract law, the general purpose of equitable remedies is to provide a fair
remedy when the legal remedy of damages does not adequately compensate the
non-breaching party.
The UCC’s Statute of Frauds applies to contracts for the sale of goods costing $500 or
more and to lease contracts involving payments of $1,000 or more.
Security interests may not be taken in intangible property.
The “American rule” provides that the first assignee to give notice to the obligor
prevails.
The Electronic Communications Privacy Act does not make it a crime to intercept an
electronic communication after receipt by the intended recipient.
Partnerships can be formed without any formalities, and the presence of the required
elements of a partnership can be based on the conduct of those in the business.
Allowing for the settlement of cases prior to trial is an example of the “providing a
basis for compromise” function of the law.
If a person dies without a will, property is distributed to his or her relatives pursuant to
the state’s testacy statute.
The only wire payment system is the Federal Reserve wire transfer network.
An illusory promise is an example of a promise that will be enforced even when
consideration is lacking.
Limited liability companies are creatures of federal law.
Jurors are sequestered in all superior court cases.
The United Nations (UN) was created by a multilateral treaty on October 24, 1975.
A shipment of nonconforming goods offered as an accommodation constitutes an
acceptance by the seller and a breach of contract.
Fraud in the inception occurs when a party is tricked into signing a negotiable
instrument while thinking he/she is signing something else.
The most common forms of implied warranties are the implied warranty of
merchantability, the implied warranty of fitness for human consumption, and the
implied warranty of fitness for a particular purpose.
Acceptance occurs when the buyer or lessee fails to effectively reject the goods within a
reasonable time after their delivery or tender by the seller or lessor.
The social justice theory has been criticized because its principles of justice are
supposed to be chosen by persons who do not know their position is society, something
that is unrealistic.
An organizational meeting of the initial directors of the corporation must be held after
the articles of incorporation are filed.
In a Chapter 11 bankruptcy case, the debtor usually continues to operate the business as
a debtor-in-possession.
The doctrine of unconscionability is based on public policy.
Which of the following can never be a valid statute of limitations in a written or oral
sales contract or lease?
A) 1 year
B) 2 years
C) 3 years
D) 4 years
E) 5 years
Fraud in the inception is also referred to as fraud in the ________.
A) factum
B) inducement
C) concealment
D) essence
E) totality of the circumstances
If the number of voting shares of the surviving corporation in a merger increases by
twenty percent or less, this eliminates which needed approvals when compared to
ordinary mergers, where the number of shares of the surviving corporation increases by
more than twenty percent?
A) shareholders of the surviving corporation
B) shareholders of both corporations
C) shareholders and the board of directors of the surviving corporation
D) shareholders and the board of directors of the corporation that does not survive
E) The approval requirements are the same, regardless of whether the increase in voting
shares of the surviving corporation is more or less than 20 percent.
Under the Securities Act of 1933, which of the following is true about activities of the
issuer during the “waiting period?”
A) The issuer cannot “condition” the market during the “post-effective” period.
B) The issuer can make preliminary sales to accredited investors during the waiting
period.
C) The issuer can distribute a preliminary prospectus during the waiting period.
D) The issuer cannot place “tombstone ads” during the waiting period.
E) The issuer cannot make any offers to sell the securities during the waiting period.
A creditor must file a ________ stating the amount of his or her claim against the
debtor.
A) proof of judgment
B) proof of claim
C) proof of equity
D) motion for directed verdict
E) motion for declaratory judgment
Which of the following is true regarding co-ownership of real property?
A) Joint tenancy and tenancy in common are two terms to describe the same legal
arrangement.
B) To create a joint tenancy, words that clearly show a person’s intent to create a joint
tenancy must be used.
C) Two owners who are married to each other cannot own the property as tenants in
common.
D) Tenancy by the entirety is often viewed as a special type of tenancy in common for
married persons.
E) When one joint tenant sells her interest to another party, the new party will also be a
joint tenant.
Alice purchases a home for $150,000. She borrows $100,000 from Local Bank, using
the house as collateral, and giving the bank a mortgage. The representative of Local
Bank forgets to record the mortgage. Alice sells the house to Bill after Bill reviews
records but finds no mortgage on the property. Alice does not tell him about the loan
from the bank, and leaves town soon after receiving the purchase money from Bill.
Alice does not pay Local Bank the remaining loan balance of her loan. Which of the
following is true?
A) Bill is liable on Alice’s loan to Local Bank, but the bank cannot foreclose on the
property.
B) Local Bank can foreclose on the property if it wants.
C) Local Bank can foreclose on the property only if it can establish that an honest
mistake was involved, and that its business practice was to record mortgages.
D) Bill takes free of the claim of the bank only if he can show that the bank had a habit
of not recording mortgages, and that the bank was negligent.
E) Bill owns the house free of any interest of Local Bank.
________ warranties are created when a seller or lessor affirms that the goods he or she
is selling or leasing meet certain standards of quality, description, performance, or
condition.
A) Express
B) Implied-in-fact
C) Equitable
D) Implied-in-law
E) Limited
The holder of a trade secret can sue the offending party for damages and obtain a(n)
________ to prohibit further unauthorized use of the trade secret.
A) injunction
B) declaration
C) corroboration
D) dissemination
E) affiliation
An employer is entitled to deny restoration of a previous job under the Family and
Medical Leave Act to:
A) any employee.
B) any hourly-paid employee.
C) any salaried employee, if the denial is necessary to prevent substantial and grievous
economic injury to the employer’s operations.
D) any salaried employee who is among the highest paid ten percent of that employer’s
employees, if the denial is necessary to prevent substantial and grievous economic
injury to the employer’s operations.
E) any salaried employee who is among the highest paid fifty percent of that employer’s
employees, if the denial is necessary to prevent substantial and grievous economic
injury to the employer’s operations.
Matt is a computer dealer in Italy. Marion owns an electronics store in the United
States. Matt agrees to sell Marion $10,000 worth of computers. Matt wants Marion to
provide him with a guarantee from a bank. The guarantee from the bank would require
the bank to pay Matt in the event that Marion fails to pay. What is the guarantee from
the bank called?
A) letter of credit
B) payment guarantee
C) lease guarantee
D) finance lease guarantee
E) sale guarantee
Sam has written a will with the following clause, “I leave $80,000 to Dave.” This gift is:
A) specific gift.
B) general gift.
C) residuary gift.
D) per capita gift.
E) per stirpes gift.
The United States Bankruptcy Code permits a ‘small business,” defined as one with
total debts of less than ________, to use a simplified, fast-track form of Chapter 11
reorganization bankruptcy.
A) $1,000,000
B) $1,343,300
C) $2,000,000
D) $2,343,300
E) $3,000,000
Someone who believes that law is a reflection of society’s morality, history, logic or
sociology believes in which school of jurisprudential thought?
A) the Natural School
B) the Historical School
C) the Analytical School
D) the Command School
E) the Psychological School
Intoxicated persons are liable ________ to pay for the reasonable value of necessaries
they receive.
A) in contract
B) in express contract
C) in implied-in-fact contract
D) in quasi-contract
E) in pari delicto
Which of the following is true about the Clean Air Act?
A) Congress established national ambient air quality standards for a number of
pollutants.
B) Congress set goals, but not standards, for a number of pollutants.
C) Congress directed the Environmental Protection Agency to set ambient air quality
standards for certain pollutants, but the Environmental Protection Agency has not yet
set the standards, due to scientific uncertainty.
D) Congress directed the Environmental Protection Agency to set ambient air quality
standards for certain pollutants, and standards have been set thus far for carbon
monoxide and sulfur oxide, among others.
E) Congress ordered the states to set ambient air quality standards, and most states have
thus far set at least some ambient air quality standards.
A type of security interest that does not just attach to a single piece of property, but can
also cover after-acquired property, is known as a:
A) temporary lien.
B) fixed lien.
C) transitory lien.
D) floating lien.
E) partial lien.
Sam owns a record store that buys and sells old vinyl records. Sam sells some records
to Tammy through eBay. Sam is considered a merchant. Sam ships the records to
Tammy. When Tammy receives the records they are smashed into a million pieces.
Tammy sues Sam for her money back, who wins?
A) Sam wins because the risk of loss passed to Tammy when he shipped the records.
B) Sam wins because as a merchant he is only responsible for shipping conforming
goods.
C) Tammy wins because Sam retained the risk of loss when he shipped the records.
D) Tammy wins because Sam is a merchant and therefore has an increased
responsibility to make sure the records arrive in one price.
E) Tammy and Sam are equally responsible.
The drawee becomes liable to pay a draft:
A) upon the drawer signing it.
B) automatically upon its creation.
C) upon accepting it.
D) upon the performance of the underlying obligation.
E) upon its presentation.
Brittany and Justin want to get married. Brittany is a resident of California, Justin is a
resident of Louisiana, and they want to get married in Nevada. They must meet the
legal requirements for marriage in:
A) California.
B) Louisiana.
C) Nevada.
D) California and Nevada.
E) Louisiana and Nevada.
What is an unconscionable contract?
A) any contract where the terms greatly favor one party
B) any contract that is contrary to public policy
C) a contract where a strong party to a contract misused his, her or its power to create
unfair contract terms
D) a contract that was entered into with both parties being fully aware of its illegality
E) any contract involving a minor or intoxicated person
Which of the following standards is generally used in determining whether personal
property has become a fixture?
A) whether the personal property has been attached to the real property
B) whether the personal property is used in the same manner as the real property
C) whether the personal property can be removed without damaging the real property
D) whether the item was attached before or after the party acquired the real property
E) whether the personal property adds to the value of the real property
Which of the following is not a defense to the Statute of Frauds?
A) There are no defenses to the Statute of Frauds.
B) course of performance
C) specifically manufactured goods
D) admissions in pleadings or court
E) partial acceptance
Which of the following is true about the Uniform Partnership Act?
A) It is the federal statute that addresses partnership law.
B) It has been adopted by all of the states.
C) It has been adopted by most states.
D) All of its provisions govern every partnership agreement formed in states where the
Act is applicable.
E) It is currently “persuasive authority” only, since it has not yet been adopted by any of
the states, and is therefore not legally binding.
Which of the following wills are recognized in some states even without witnesses?
A) a holographic will
B) a reciprocal will
C) a nuncupative will
D) a joint will
E) None of the above requires witnesses.
Which of the following statements best describes the procedures under the Clean Air
Act?
A) The federal government sets and enforces the standards.
B) The state governments set and enforce the standards.
C) The federal government sets the standards, and the state governments enforce the
standards; if the states do not adequately enforce the standards, the federal government
may enforce them.
D) The state governments set the standards, and the federal government enforces the
standards; if the federal government does not adequately enforce the standards, the
states may enforce them.
E) Both the federal and state governments set standards, and each enforces its own
standards.
Which of the following is false regarding a strategic alliance?
A) A strategic alliance is an arrangement between two or more companies in the same
industry, in which the companies agree to ally themselves to accomplish a designated
objective.
B) A strategic alliance allows the companies to share costs and combine technologies.
C) Companies often enter into a strategic alliance when they decide to expand
internationally into a foreign country.
D) A strategic alliance resembles a corporation in terms of its legal formation
requirements, organizational structure, and business purpose.
E) A strategic alliance partner is a potential competitor.
What role does a party’s subjective intent relative to the intent to form a contract play?
A) It determines whether an offer has been made.
B) It determines whether an offer is definite.
C) It determines whether a contract has come into existence.
D) It determines whether an offeree’s acceptance is valid.
E) It is irrelevant.
Business law teacher Susie Law copies 5 pages out of a 999-page book in the library for
use in class. Ms. Law did not want her students to have to purchase the entire book
because of the expense involved. A grumpy library assistant calls the publisher of the
book and informs on Ms. Law. Is Ms. Law in trouble?
A) Ms. Law will be liable for copyright violation, because the students should have
been required to buy the book.
B) Ms. Law will be liable for trademark violation, because the students should have
been required to buy the book.
C) It is unlikely that Ms. Law will be in trouble, because her use of a few pages would
probably constitute a “fair use” under copyright law.
D) It is unlikely that Ms. Law will be in trouble, because her use of a few pages would
probably constitute a “fair use” under trademark law.
E) Ms. Law will be liable for copyright violation, but only if she made a profit from the
use.
A farmer’s cooperative in North Dakota enters into a contract to sell wheat to the
government of Thailand. If a dispute arises under the contract, the farmers’ cooperative
can:
A) sue in a United States court, because neither the act of state doctrine nor sovereign
immunity would apply.
B) not sue in a United States court, because of the act of state doctrine.
C) not sue in a United States court, because of sovereign immunity.
D) not sue in a United States court, because of comity.
E) not sue in a United States court, because of international sovereignty.