Jackson Lumber hires Owen to purchase wood from various sources on behalf of
Jackson Lumber. In this relationship, Jackson Lumber is the
a. employee.
b. independent contractor.
c. principal.
d. agent.
Megan goes to visit her friend Kathleen. While visiting, Megan downloads Kathleen’s
copy of Photoshop onto her computer’s random access memory without Kathleen’s
permission. Megan is guilty of
a. copyright infringement.
b. patent infringement.
c. cybersquatting.
d. trademark dilution.
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.
Nouveau Riche Corporation’s officers, directors, and shareholders buy and sell
securities. SEC Rule 10b-5 applies to
a. only the purchase or sale of a security by a financial corporation.
b. only the purchase or sale of a security involving an officer or director.
c. only the purchase or sale of a security involving a shareholder.
d. the purchase or sale of any security.
Beef Burgers, Inc. contracts to buy five hundred steers from Fattening Feedlots. Before
Fattening Feedlots can deliver the steers, there is an outbreak of disease in the feedlot,
and all the cattle are quarantined. In this case the perfect tender rule
a. applies to both parties.
b. does not apply.
c. applies only to Beef Burgers.
d. applies only to Fattening Feedlots.
A common ethical dilemma faced by the management of Spencer Hydraulics
Corporation involves the effect that its decision will have on
a. one group as opposed to another.
b. the firm’s competitors.
c. the government.
d. the U.S. Chamber of Commerce.
Nina is a director of Omega, Inc. Under the standard of due care owed by directors of a
corporation, Nina’s decisions must be
a. ambiguous and questionable.
b. arguable and defensible.
c. informed and reasonable.
d. perfect and unassailable.
Doug agrees with Elinor to sell methamphetamine to patrons of Elinor’s nightclub
Garden of Eden for 25 percent of the take. Doug sells the drugs but keeps all of the
money. Elinor can
a. recover her share of the money only if she did not aid in the crime.
b. not enforce the deal.
c. recover the total amount of the sales.
d. recover her costs but none of the illegal profit.
Dahlia borrows $125,000 from Clearview Credit Union to buy a home. The interest rate
and other terms that are required to be disclosed under federal law must be
a. based on uniform formulas of calculation.
b. expressed in lenders’ language.
c. set out in a formula unique to each loan.
d. stated in “legalese.”
Elinor sells Cathy a horse for $2,000. When Elinor goes to the bank to deposit Cathy’s
check, the check bounces. Elinor is furious and files suit against Cathy. Elinor probably
filed her suit in
a. a small claims court.
b. a domestic relations court.
c. a municipal court.
d. a probate court.
Nika owns land in Ohio. Her ownership rights include the right to sell or give away the
property without restriction, and the right to commit waste, if she chooses.
Refer to Fact Pattern 24-1. Nika deeds some of her land to Polly. The deed states, “To
Polly, for life, then to Quay.” Nika has given Polly
a. a fee simple absolute.
b. a fixed-term tenancy.
c. a life estate.
d. an easement.
Equipment Rental Corporation and Floodlights, Inc., are parties to an oral agreement
for a lease of goods with payments in excess of $10,000. They may satisfy the Statute
of Frauds by
a. mutually agreeing not to commit fraud.
b. restating the terms in a phone call.
c. setting out the terms in an e-mail.
d. shaking hands on the deal.
Southwestern Foods Corporation operates a packaging plant near the border between
the United States and Mexico. Due to the location, it would be easier for Southwestern
to employ noncitizens. With respect to persons not authorized to work in the United
States, an employer can
a. hire them.
b. recruit them.
c. refer them for a fee.
d. not hire them, recruit them, or refer them for a fee.
Fact Pattern 15-1
Mary’s home is in a state that has a $30,000 homestead exemption. Mary defaults on a
$60,000 debt that she owes to Nina. Mary’s home is sold at auction for $80,000.
Refer to Fact Pattern 15-1. Mary will receive
a. $0.
b. $30,000.
c. $50,000.
d. $60,000.
George has a badly infected right foot. Herb, George’s physician, prescribes amputation.
George agrees. During the operation, Herb amputates the left foot. In George’s suit
against Herb, George’s best theory for recovery is
a. assumption of risk.
b. negligence per se.
c. res ipsa loquitur.
d. strict liability.
In some cases, foreign states are not immune from the jurisdiction of U.S. courts. These
circumstances are governed by the
a. Uniform Commercial Code.
b. Foreign Sovereign Immunities Act.
c. European Union.
d. North American Free Trade Agreement.
Mackenzie, an agent for Lindsay, signs an agreement with Kirk on Lindsay’s behalf but
neglects to tell her that the agreement requires the payment of a certain tax. The
government prosecutes Lindsay for failing to pay the tax. She is
a. liable, because notice to Mackenzie is notice to Lindsay.
b. liable, because notice to Kirk is notice to Lindsay.
c. not liable, because Mackenzie did not tell Lindsay about the tax.
d. not liable, because Kirk did not tell Lindsay about the tax.
Fay pays $800 for a new iPad to Global Goods, Inc. Global holds the iPad until Fay
picks it up. Global is
a. a bailee.
b. a consignee.
c. a lessee.
d. a seller.
Bild-It-Rite Corporation is a public company that is preparing to issue securities that do
not qualify for an exemption from registration. This means that Bild-It-Rite must
a. file a registration statement with the SEC.
b. issue the securities through an online registration site.
c. refrain from issuing the securities to unregistered investors.
d. register the securities with a national stock exchange.
Screen Perfect, Inc., and TV Stores enter into a contract for a sale of high-definition
television sets. Screen Perfect ships goods that do not exactly conform to the contract in
some details. TV Stores
a. cannot reject the entire shipment.
b. can reject the entire shipment.
c. must accept the entire shipment.
d. must reject the entire shipment.
Wilson wants to file an ordinary, or straight, bankruptcy. Wilson should file using
a. Chapter 7.
b. Chapter 11.
c. Chapter 13.
d. his state’s bankruptcy code.
Dizzy is not Edwina’s agent but enters into a contract with Frida on Edwina’s behalf.
Edwina later contacts Frida to affirm the contract. This is
a. an agency by agreement.
b. an agency by estoppel.
c. an agency by ratification.
d. not the creation of an agency relationship.
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.
Byron agrees to sell to Charity, for $1,500, a remote parcel of land. They believe the
land to be worthless, but beneath it is a gold mine. A court would
a. cancel the contract due to Byron’s failure to know the land’s value.
b. cancel the contract due to Charity’s failure to know the land’s price.
c. cancel the contract due to the difference between the contract price and the market
price.
d. enforce the contract.
Network Industries, Inc., wants to monitor its employees’ electronic communications.
To avoid liability under laws related to employee monitoring, Network should announce
the monitoring to
a. no one.
b. the employees.
c. the government.
d. the public generally.
BBQ, Inc., makes and sells grills to Grill Mart, a retailer, which sells one of the grills to
Hope, a consumer. BBQ and Grill Mart include in their contracts a limitation on
consequential damages for personal injuries arising from a breach of warranty. This is
prima facie unconscionable with respect to
a. all of these parties.
b. BBQ and Grill Mart, but not Hope.
c. Hope only.
d. none of these parties.
As a judge, Bonnie applies common law rules. These rules develop from
a. administrative regulations.
b. court decisions.
c. federal and state statutes.
d. proposed uniform laws.
Caf Cuisine Dining, Inc., employs one hundred workers at three locations in two states.
Under federal law, Caf Cuisine must provide its employees, during any twelve-month
period, family or medical leave of up to
a. twelve days.
b. twelve weeks.
c. twelve months.
d. twelve years.
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.
Dewey is the payee for a check written by Fred. Cash Credit Corporation (CCC)
accepts the check from Dewey as part of a payment. CCC cannot become a HDC if
a. the check has been transferred more than once.
b. the check has been outstanding for one week.
c. the check has been outstanding for more than ninety days.
d. there are bankruptcy proceedings against Fred.
Forest & Field Company makes and leases a backhoe to Zac. Due to a defect
attributable to Forest & Field’s negligence, Zac is injured in an accident in which his
neighbor Aaron is also hurt. In a product liability suit based on negligence, Forest &
Field may be liable to
a. Aaron only.
b. no one.
c. Zac and Aaron.
d. Zac only.
Brenda is a purchasing agent for Commodities Exchange Corporation. Dennis, a
Commodities corporate officer, gives Brenda written authority to buy for the firm as
many computers and peripheral devices as necessary. The next day, Dennis calls Brenda
and tells her to buy only fifty notebook computers and nothing else. Brenda shows the
written authority to E-Products, Inc., and enters into a contract with E-Products to buy
sixty notebook computers and a selection of printers, scanners, and extra storage media.
E-Products ships the order to Commodities. Is Commodities liable to E-Products under
the contract? Is Brenda liable? In each case, if so, why? If not, why not?
Plato works for Quirky Squirters, Inc. During work hours, Plato ‘steals” time, space, and
data on his employer’s computer system to start up his own business, Rowdy Drenchers.
This is
a. burglary.
b. robbery.
c. larceny.
d. no crime.
Machismo Motor Sales Corporation regularly advertises its off-the-road vehicles,
all-terrain vehicles, and other products. Under the First Amendment, these ads and other
commercial speech are given
a. less extensive protection than noncommercial speech.
b. more extensive protection than symbolic speech.
c. no protection.
d. the same protection as defamatory speech.
Commercial banking practices consider a check that has been outstanding for three
months to be a stale check.
In a contract for a sale of goods, the usual measure of compensatory damages is the
difference between the contract price and the market price.
A warranty deed provides the most protection against defects of title.
Remedies of the agent for breach of duty by the principal arise out of contract and tort
law.
The possession of monopoly power alone does not constitute the offense of
monopolization.
When a U.S. firm wishes to increase its involvement in an international market, it
normally establishes an agency relationship with a foreign firm.
A liquidated damages provision specifies that a certain amount to be paid in the event of
a future default or breach of contract.
Each member country of the TRIPS agreement must include in its domestic laws
intellectual property rights.
Liquidated damages provisions are usually not enforceable.
Congress creates an administrative agency by enacting enabling legislation.
Title VII of the Civil Rights Act of 1964 prohibits only intentional discrimination.
It is estimated that over 70 percent of the goods imported to the United States are
counterfeit.
Some companies set up confidential systems for employees to “raise red flags” about
suspected unethical practices.
The dangers associated with using sharp knives are so commonly known that
manufacturers need not warn users of those dangers
A finder of mislaid property is an involuntary bailee.
A principal who causes a third person to believe that another person is the principal’s
agent can be estopped from denying the agency relationship.
Interrogatories are written questions for which written answers are prepared and signed
under oath.
A buyer and a seller cannot normally have an insurable interest in identical goods at the
same time.