Suisse Internationale, a Swiss maker of athletic equipment, enters into a price fixing
agreement with Total World Sports, a U.S. wholesaler of Suisse’s products. U.S. courts
will apply U.S. antitrust laws if
a. the agreement was made in Switzerland.
b. the agreement was made in the United States.
c. the price fixing has a substantial effect on U.S. commerce.
d. the Swiss government agrees to be sued in the United States.
State legislatures create state agencies through
a. enabling acts, similar to federal enabling legislation.
b. the Federal Trade Commission, through the rulemaking process.
c. the president, through an executive order.
d. the governor, through a petition.
Delta, Inc., agrees to assume a debt of Excel Company to First State Bank. The
agreement is not in writing. To be enforceable, the promise must be for the benefit of
a. any party.
b. Delta.
c. Excel.
d. First State.
Fact Pattern 25-2
Tom draws a check, on his account in State Bank in New York, payable to Digital
Media, Inc., in San Francisco. Digital deposits the check in its account at First National
Bank.
Refer to Fact Pattern 25-2. Digital’s bank is
a. the cashing bank.
b. the depositary bank.
c. the intermediary bank.
d. the payor bank.
Odell is a director of Price Rite, Inc. As a director, with respect to the corporation, Odell
is
a. a fiduciary.
b. a forum.
c. a proxy.
d. a quorum.
Julia owes Ryan $10,000. When the debt comes due, Julia refuses to pay. Ryan obtains
a judgment against Julia to collect the debt, but she still refuses to pay. Using a writ of
execution, the court orders the sheriff to seize Julia’s motor boat and sell it to pay the
debt. The boat sells for $15,000. Ryan
a. will receive $15,000 and Julia will receive nothing.
b. will receive $10,000 and Julia will receive $5,000.
c. will receive $7,500 and Julia will receive $7,500.
d. will receive $10,000 and the court will receive $5,000.
Cody and Dora enter into an oral contract under which Cody agrees to work on Dora’s
farm for not less than one week. This contract is enforceable by
a. Cody only.
b. Dora only.
c. either party.
d. neither party.
Gregory obtains a consumer loan from Finance Bank at an interest rate that exceeds the
state’s maximum. Finance has
a. calculated the optimum rate that the market will bear.
b engaged in a restraint of trade.
c. underestimated the risk of the loan’s nonpayment.
d. violated the usury laws.
Owen is a holder of a promissory note obtained from Purchase Money, Inc. Regarding
the defenses against payment of the note to which Purchase Money is subject, Owen, as
an ordinary holder, is subject to
a. more defenses.
b. no defenses.
c. some defenses, but not as many.
d. the same defenses.
Good Tire Company and Hiway Auto Service enter into a contract for a sale of tires.
Good Tire is a merchant who deals in goods of the kind sold. Under the UCC, an
implied warranty of merchantability arises
a. automatically in sales contracts.
b. only if the buyer asks for it.
c. only if the seller does not expressly disclaim it.
d. only in conjunction with lease contracts, not sales contracts.
Pine Mills Corporation and Ur-Choice Lumberyards enter into a contract for a sale of
plywood. Under a destination contract, the seller must
a. allow the buyer to reject the goods for any reason.
b. deliver the goods to a particular destination.
c. inspect the goods before tendering their delivery.
d. place the goods into the hands of a carrier.
Silas Paving Co. contracts to buy some construction machinery from Massive
Earthmovers, Inc. Before either party performs, Massive sells its assets to Phoenix
Equipment Corp. On learning of the sale, Silas is concerned about its contract with
Massive. Silas should
a. demand assurances of performance from Massive.
b. consider the contract repudiated and sue Massive for breach.
c. buy the machinery from a different supplier and bill Massive for the price.
d. buy the machinery from a different supplier and bill Phoenix for the price.
A petition for a discharge in bankruptcy under Chapter 13 may be filed by
a. Gracie, the sole proprietor of Home Net Services.
b. Internet Portals & Pages, a partnership.
c. World Web Services, Inc., a corporation.
d. Internet Portals & Pages or World Web Services, Inc..
With respect to Egor’s land, Fig has an easement, Gabe has a profit, and Huck has a
license. A right to possess the land is owned by
a. Egor, Fig, and Gabe only.
b. Egor and Gabe only.
c. Egor only.
d. Fig, Gabe, and Huck only.
Joe files a voluntary petition for Chapter 7 bankruptcy. His petition does NOT need to
include
a. a list of Joe’s secured creditors.
b. a list of Joe’s unsecured creditors.
c. a list of the occupations of all Joe’s creditors.
d. the addresses of all Joe’s creditors.
Grover contracts to sell two tracts of land to Hank. Both parties believe that the two
tracts are adjacent, but in fact they are not. Grover is still willing to sell the land, but
under these circumstances the deal would adversely affect Hank.
Refer to Fact Pattern 13-2. The parties’ belief about the adjacency of the property is
a. a bilateral mistake.
b. a fraudulent misrepresentation.
c. a unilateral mistake.
d. unconscionable.
Elsa participates in a Title VII investigation at the firm where she works. As a result,
Elsa’s employer demotes her. Elsa can file a
a. harassment complaint.
b. retaliation claim.
c. constructive discharge claim.
d. disparate-impact discrimination claim.
Rollo promises to perform, for a price, shoe repair services in affiliation with Togs “n
Things, a clothing store. To support a contract, the consideration exchanged by the
parties must be
a. adequately considerate.
b. equally valuable.
c. legally sufficient.
d. wisely priced.
Svetlana, a fifty-five-year-old member of a racial minority with a disability, believes
that she is a victim of employment discrimination. Potentially the most widespread
form of discrimination is based on
a. age.
b. disability.
c. gender.
d. race.
A specific grade of corn that fills BioFuel Cooperative’s silo is fungible. This means
that the corn is
a. alike naturally or by agreement or trade usage.
b. fundamentally different.
c. fundamentally edible.
d. perishable.
Sabin and Tyler agree while talking on the phone to form a partnership. Their
partnership agreement is legally binding
a. only if a third person knows of the agreement.
b. only if the agreement is reduced to writing.
c. only if the parties exchange valid consideration.
d. without more.
Kip, a representative for Lite-Weight Shipping Company, delivers a bill of lading to
Meg, the owner of Capacity Storage Warehouse. A bill of lading is
a. an invoice for payment for loading and carting.
b. an order to ship goods by carrier to a certain destination.
c. a receipt for goods signed by a carrier.
d. a receipt issued by a warehouser for goods in a warehouse.
Lee is seventy years old and Mira is gay. Based on this information, members of
protected classes include
a. Lee and Mira.
b. Lee only.
c. Mira only.
d. neither Lee nor Mira.
Jillian and Ruth are neighbors. In the ordinary course of their respective businesses,
neither Jillian nor Ruth lend money, sell on credit or arrange for the extension of credit.
Jillian sells Ruth a lawn mower that Ruth must pay for through six months of monthly
payments. The sale is
a. covered by the Truth-in-Lending Act.
b. not covered by the Truth-in-Lending Act.
c. illegal under the Truth-in-Lending Act.
d. covered by the Truth-in-Lending Act only if the price of the
lawnmower exceeds $500.
Richard is an adult. He enters into a contract to sell sixteen-year-old Jane his car for
$3,000. The next day Richard receives an offer of $4,000 for his car from
twenty-year-old Bill. Richard
a. cannot disaffirm his contract with Jane because he is an adult.
b. can disaffirm his contract with Jane because Bill is an adult and contracts with adults
take precedence over contracts with minors.
c. cannot disaffirm his contract with Jane because she is a minor.
d. can disaffirm his contract with Jane because the contract has not been ratified.
Eric owns a beach house in California. His ownership is considered fee simple absolute.
Eric’s fee simple
a. is potentially infinite in duration.
b. will end with his death.
c. will last for fifty years.
d. will last for seventy-five years.
Sudan seizes the assets of Triage Medical, Inc., a U.S. firm. Triage’s recovery from
Sudan in a U.S. court may be prevented by
a. the act of state doctrine.
b. the doctrine of sovereign immunity.
c. the Foreign Corrupt Practices Act.
d. the principle of comity.
Shelby wants to sell his Bobcat Skidsteer for $21,000. He emails Dave and offers to sell
Dave the Bobcat. Due to a typo, Shelby tells Dave that he wants $20,100 for the
Bobcat. Dave accepts the offer and pays Shelby $20,100. Shelby is
a. not bound by the contract due to a unilateral mistake.
b. not bound by the contract due to a bilateral mistake.
c. not bound by the contract due to a mistake of value.
d. bound by the contract.
Ginny obtains a health-insurance policy for her family from Hope Insurance Company.
The policy includes an incontestability clause. Under such a clause, after a policy has
been in force for a specified period or time, such as two or three years
a. Ginny cannot enter a contest sponsored by Hope or its affiliate.
b. Ginny cannot contest Hope’s refusal to pay a claim under the policy.
c. Hope cannot contest Ginny’s eligibility for continued coverage.
d. Hope cannot contest Ginny’s statements in the application.
Paychex Loan Company extends credit in the ordinary course of its business. Under the
Truth-in-Lending Act, Paychex must inform potential borrowers of
a. credit terms offered by other lenders and its own credit terms.
b. only credit terms offered by other lenders.
c. only its own credit terms.
d. only the credit terms that will convince borrowers to “close the deal.”
Mena applies for a homeowners’ insurance policy on her house with Neighbors
Insurance Company through Obie, an agent who works for Neighbors. In this
transaction, Obie is
a. an agent for both parties.
b. Mena’s agent, and not Neighbors’s agent.
c. Neighbors’s agent, and not Mena’s agent.
d. not an agent.
A disclosed principal is a principal whose identity is not known by the third party at the
time the contract is made by the agent.
Owners in common are owners with an undivided share of the whole.
Once the time for performance under the contract has expired, the seller or lessor can
never exercise the right to cure.
Only federal law governs drug tests of private-sector employees.
A lottery is an example of an offer for an unilateral contract.
A party is entitled to cancel a contract based on the other party’s material breach.
Eppie gives a check to Fund Investments to buy 100 shares of stock in GR8 Tech
Corporation for Eppie. The price of the shares is constantly fluctuating. Fund
Investments asks Eppie to leave the amount of the check blank and allow it to fill in the
price when making the purchase. Eppie agrees. Fund Investments buys the stock when
the price is $4,000, but fills in the check for $5,000. The check is negotiated as payment
for a $5,000 debt to Hasty Accounting Services, which takes the check in good faith and
without notice of Fund Investments’ act. Hasty later learns that Fund Investments was
not authorized to fill in the check for $1,000 over the price. Is Hasty an HDC? If so, for
how much?
A person who receives unsolicited merchandise and keeps it without notifying the
sender does NOT commit mail fraud.
False imprisonment occurs when a person restrains another intentionally and without
justification.
Liability insurance provides indemnity against losses in trade or losses caused by the
dishonesty of employees.
According to the Foreign Sovereign Immunities Act, a foreign state that has committed
a tort in the United States is protected from the jurisdiction of the U.S. courts.
Plant life is considered to be real property.
Under the Statute of Frauds, all written contracts are enforceable.
The chief aim of the European Union and other trade organizations is to minimize trade
barriers among their members.
A transfer of contract duties to a third party is an assignment.
Once a discharge is granted, it may not be revoked, even if, for example, a debtor
concealed property to defraud a creditor.
A false statement by an expert to a naive buyer about a technical detail will usually
entitle the buyer to rescind or reform a contract.