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Which of the following was the result in Family Winemakers of California v. Jenkins,
the case brought by winemakers from California challenging a Massachusetts law
distinguishing between how large and small winemakers could distribute their wines in
Massachusetts?
A. That the law impermissibly discriminated against out-of-state winemakers in
violation of the Commerce Clause.
B. That the law permissibly discriminated against out-of-state winemakers and did not
violate the commerce clause.
C. That the law impermissibly discriminated against out-of-state winemakers in
violation of the Twenty-first Amendment to the U.S. Constitution.
D. That the law impermissibly discriminated against out-of-state winemakers in
violation of the Webb-Kenyon Acts.
E. That the law did not discriminate against out-of-state winemakers and that, therefore,
no violation occurred.
A[n] _____ is any description of the good's physical nature or its use, either in general
or specific circumstances, that becomes part of the contract.
A. Express warranty
B. Implied warranty
C. Acknowledged warranty
D. Claimed warranty
E. Consequential warranty
According to the UCC, which of the following should a financing statement list?
A. The names and addresses of all parties involved only.
B. Two items: (1) the names and addresses of all the parties involved and (2) a
description of the collateral.
C. Three items: (1) the names and addresses of all the parties involved, (2) a description
of the collateral, and (3) the signature of the debtor.
D. Three items: (1) the name of the financing bank, (2) the name of the debtor, and (3) a
description of the collateral only.
E. Three items: (1) the name of the financing bank, (2) the signature of the debtor, and
(3) a description of the collateral.
"Accidental Sale." Robby entrusted his automobile to ABC Motors for repair. The
manager of ABC Motors, who did a very poor job with inventory, accidentally sold the
car to Connie. Connie, who paid cash for the car, had no idea that the car did not belong
to ABC Motors and paid fair market value for it. When Robby went to pick up the car,
he was very upset that it was gone. The manager of ABC Motors told him that he was
very sorry, but that his only recourse would be against Connie.
Which of the following is a proper identifying term for Connie?
A. A good-faith purchaser
B. A valid purchaser
C. A void purchaser
D. A voidable purchaser
E. An interested purchaser for value
According to the Revised Uniform Limited Partnership Act, which of the following is
not a reason for which a limited partnership can be dissolved?
A. The expiration of the term established in the certificate of limited partnership.
B. The completion of the objective established in the certificate.
C. The withdrawal of the general partner (unless the certificate establishes that other
general partners will continue).
D. An act of the court.
E. The written consent of a majority of all partners (limited and general).
"Miracle Face." Tara developed a great new type of face cream guaranteed to provide
total sun protection, remove wrinkles, and result in anyone looking at least ten years
younger. Her product, Miracle Face, became extremely popular in the U.S., where she
has several shops, and also in other countries to which it was shipped. Tara has a
number of individuals in other countries seeking to team with her in selling Miracle
Face. Sam, a citizen of Mexico, asks that she grant him permission to use her name and
any associated trademarks, and allow him to sell Miracle Face in Mexico. Tara has an
offer, however, from another Mexican citizen, Maria. Maria proposes that she and Tara
associate together, open a business to sell Miracle Face, and share profits and
management responsibilities. Tara has also thought about opening her own business in
Mexico in conformity with Mexican laws. She would then, hire employees in Mexico to
sell the product. Another matter Tara has considered is simply arranging for her
products to be shipped to Mexico for sale, and she is interested in the effect of any trade
agreements in effect between the U.S. and Mexico.
Assuming that Tara decides to proceed as Maria proposes, their arrangement would be
a[n] ______.
A. Franchisee-franchisor arrangement
B. Affiliator-affiliatee arrangement
C. Joint venture
D. Licensing agreement
E. Subsidiary agreement
"Painted House." Billy had a contract to paint Jan's house for $800 including the duty to
clean up any debris. The contract between Billy and Jan did not address assignment in
any way. Billy, who was very busy, assigned the contract, specifying that it included the
right to receive the money and the duty to paint the house, to Richard who was
interested in making some extra money and had experience painting. Billy did not tell
Jan about the assignment because he did not want any trouble nor did Richard mention
the assignment to her. In fact, Richard never met Jan because he painted while she was
at work. After Richard did a good job painting the house, Jan sent a check to Billy for
$800. Billy needed the money to pay some bills, so he spent it. He thought he would
have money coming in with which to pay Richard, but that did not happen. Richard
asked Jan for $800 when it was not forthcoming from Billy. Jan refused. Richard said
that he was going to sue her. Jan called Billy and told him that he had no right to assign
the contract. Another problem involved disposal of debris. Although Richard was a
good, competent painter, he forgot and left some old paint cans at Jan's house. Jan
demanded that Billy come and properly dispose of the paint cans because they could
not simply be put in the trash. Billy refused and told her that she would have to get
Richard to dispose of the paint cans because that was his responsibility. Jan called
Richard who told her that he was busy and that clearing out the paint cans was Billy's
responsibility.
Which of the following is true regarding Billy's claim that he had no duty to pick up the
paint cans?
A. Billy is correct because he validly delegated that duty to Billy.
B. Billy is incorrect because the job was a personal service, and he had no right to
assign either rights or duties under the contract.
C. Billy is incorrect but only because the job was for under $1,000.
D. Billy is correct only because Richard properly painted the house and was, therefore,
responsible for ancillaries. If Richard had improperly painted the house, Billy would
have had remaining duties.
E. Billy is incorrect because his delegation did not affect his obligation to Jan.
"Business Law Rocks." Business law teacher Penny ordered 50 T-shirts for her classes
that said "Business Law Rocks" on the front. She wanted to give them out on the last
day of class and contracted with Frank, who owned a T-shirt business, for the shirts to
arrive by that day. The shirts arrived on Thursday, just before the last day of classes on
Friday. Unfortunately, the shirts said "Business Law Yuck" on the front. Frank told
Penny that he would remedy and fix the problem and that he had the right to do so. She
told him, however, that she had to have the shirts the next day because the students
would be gone after that. Penny had also ordered some pamphlets on employment law
to be used the next fall semester. The seller had agreed to provide the pamphlets 30
days before spring semester ended. The seller, however, erred and sent pamphlets on
environmental law which arrived 28 days before spring semester ended. The seller
attempted to remedy the problem by sending the correct pamphlets on employment law,
but they did not arrive until 27 days before spring semester ended. None of the parties
had any prior dealings.
Which of the following is true regarding the efforts of the seller of the employment law
pamphlets to remedy the problem with the incorrect pamphlets?
A. The seller could not exercise the right to cure once the contract time for performance
had ended because the seller did not have reasonable grounds to believe that the
nonconforming tender of environmental pamphlets would be acceptable to Penny.
B. The seller could likely exercise the right to cure once the contract time for
performance had ended because the seller would have had reasonable grounds to
believe that Penny would not have objected to the tender of the correct item at the time
it was tendered.
C. The seller correctly acted to remedy the problem because he had up to 10 days under
the UCC to fix any problem.
D. The seller correctly acted to remedy the problem because he had up to 20 days under
the UCC to fix any problem.
E. The seller could not act to remedy the problem because he did not have assurance
from Penny in writing that she would allow additional time in which to cure.
Which of the following is a statement in which a company agrees with the Federal
Trade Commission to stop disputed behavior but does not admit it broke the law?
A. Agreed stoppage
B. Command order
C. Consent order
D. Agreed order
E. Approved acknowledgement
The UCC requires that buyers are obligated to accept and pay for ______ in accordance
with the contract.
A. Reasonably conforming goods
B. Select conforming goods
C. Materially conforming goods
D. Significantly conforming goods
E. Conforming goods
A defendant uses a[n] ______ when her or his answer admits that the facts contained in
the complaint are accurate but also includes additional facts that justify the defendant's
actions and provide a legally sound reason to deny relief to the plaintiff.
A. Secondary answer
B. Pleading defense
C. Affirmative defense
D. Formal answer
E. Personam answer
Which of the following doctrines arose from cases in England in which parties who had
contracted for rooms along a parade route for a king's coronation, received their money
back when the coronation was canceled because the king became ill?
A. Frustration of purpose
B. Commercial impracticability
C. Alteration of the contract
D. Anticipatory repudiation
E. Anticipatory renunciation
Which of the following was the result in In re Hydro-Action Inc., the bankruptcy case in
the text involving whether a claimant was entitled to a lien upon a conveyor belt system
that it installed?
A. The court found that a lien was foreclosed because the claimant did not qualify as a
mechanic, artisan, or materialman.
B. The court found that a lien was foreclosed because the transaction did not involve the
manufacturing or repairing of an "article" or "building" as required under applicable
law.
C. The court found that a lien was foreclosed because the bankruptcy trustee had
priority.
D. The court found that a lien was available because the claimant qualified as a
materialman engaged in manufacturing an article for the debtor thereby satisfying
applicable law.
E. The court found that a lien was available because under principles of equity, it would
be unjust to deny the claimant a recovery.
Which of the following types of insurance protects contractors against liability for
injuries that might occur while completing a job, excluding injuries to employees?
A. Professional liability
B. Compensation insurance
C. Contractors' liability
D. Building liability
E. Harm liability
Which of the following is true if a debtor engaged in fraud in order to convince a surety
or guarantor to enter into a contract with a third party?
A. Because the third party is innocent, neither the surety nor the guarantor is released
from liability.
B. The surety is released from liability, but the guarantor is not.
C. The guarantor is released from liability, but the surety is not.
D. Both the guarantor and the surety will likely be released from liability.
E. Both the guarantor and the surety will likely be released from liability on interest due
on the contract, but not for the principle amount.
Which of the following states that in the case of multiple assignments of the same right,
the first assignee to give notice of assignment to the obligor is the party with rights to
the contract?
A. The first-assignment-in-time rule
B. The last-assignment-in-time rule
C. The English rule
D. The French rule
E. The American rule
Which of the following is true once a guardian has been appointed for a person who has
been adjudicated insane?
A. If a person has been adjudicated insane and has a guardian appointed, that person has
no capacity to enter into contracts and any contract he does attempt to enter into is void.
B. If a person has been adjudicated insane and has a guardian appointed, that person has
no capacity to enter into contracts and any contract he does attempt to enter into is
voidable.
C. If a person has been adjudicated insane and has a guardian appointed, that person
retains capacity to enter into contracts so long as the other party to the contract is aware
of the guardian's status.
D. If a person has been adjudicated insane and has a guardian appointed, that person
retains capacity to enter into contracts so long as the other party to the contract is aware
of the insanity issue.
E. If a person has been adjudicated insane and has a guardian appointed, that person
retains capacity to enter into contracts so long as the other party to the contract is aware
of the guardian's status and also the insanity issue.
Which of the following torts seek to compensate people wrongfully subjected to
litigation?
A. Malicious prosecution, wrongful civil proceedings, and abuse of process.
B. Wrongful civil proceedings but not malicious prosecution or abuse of process.
C. Abuse of process but not malicious prosecution or wrongful civil proceedings.
D. Malicious prosecution and wrongful civil proceedings, but not abuse of process.
E. Malicious prosecution and abuse of process but not wrongful civil proceedings.
Negotiable instruments payable to whoever is bearing them are known as ______
instruments.
A. Demand
B. Order
C. Transactional
D. Bearer
E. Payor
Without legal assent a contract may be ____.
A. Unmarketable
B. Unchargeable
C. Void
D. Illegal
E. Voidable
Which of the following is an example of a formal contract?
A. Contracts under seal but not executed contracts or letters of credit.
B. Executed contracts but not contracts under sale or letters of credit.
C. Letters of credit and contracts under seal, but not executed contracts.
D. Contracts under seal letters of credit, but not executory contracts.
E. Contracts under seal, letters of credit, and also executed contracts.
Which of the following is generally false when a consolidation occurs?
A. The new corporation has independent legal status.
B. The original corporations continue to exist legally.
C. The consolidated entity assumes the debts of the original corporations.
D. The consolidated entity obtains the original corporations' assets.
E. The consolidated entity takes on the rights of the original companies.
"Employment law." Clare, who has a successful pet grooming business, is planning to
expand her operations from the U.S. into Canada and perhaps Mexico. A friend of hers,
Bill, told her that she should carefully investigate the laws in those countries before she
proceeded. Clare responded, however, that she was not concerned because by
international treaty, and under NAFTA, so long as she is a U.S. citizen, she only has to
obey the U.S. laws. Laws of other countries would not apply to her business operations.
Clare also replied that any other country would have the same strict employment-at-will
standard as exists in the U.S. She tells him the strict employment-at-will standard has
not changed over the years, and that the nature of the relationship between employer
and employee remains untouched.
Which of the following is true regarding Clare's statement that so long as she obeys the
laws of the U.S., she does not need to be concerned about laws of other countries?
A. She is accurate.
B. She is accurate, but only in regard to laws pertaining to employment.
C. She is inaccurate.
D. She is accurate, but only in regard to laws involved with the Uniform Commercial
Code.
E. She is accurate, but only if countries are signatories to NAFTA.
"Employment law." Clare, who has a successful pet grooming business, is planning to
expand her operations from the U.S. into Canada and perhaps Mexico. A friend of hers,
Bill, told her that she should carefully investigate the laws in those countries before she
proceeded. Clare responded, however, that she was not concerned because by
international treaty, and under NAFTA, so long as she is a U.S. citizen, she only has to
obey the U.S. laws. Laws of other countries would not apply to her business operations.
Clare also replied that any other country would have the same strict employment-at-will
standard as exists in the U.S. She tells him the strict employment-at-will standard has
not changed over the years, and that the nature of the relationship between employer
and employee remains untouched.
What concept is Clare referencing when she mentions employment-at-will?
A. The right of the employer or the employee to terminate the employment relationship
at any time.
B. The requirement that an employer have good cause before discharging an employee.
C. The requirement that an employee give notice before quitting.
D. The requirement that employers may at will require employees to work overtime
without pay.
E. The requirement that employers allow employees to take breaks at will only after six
hours of work.
After a significant amount of responsibility for the bankruptcy of ____________
Corporation was placed on the firms that provided accounting services for the
corporation, the role of accountants became a question of significant public interest.
A. Enron
B. Acron
C. Selinas
D. Prolific
E. Deltoid
Which of the following is a federal law regulating the payment of wages and overtime?
A. The Fair Pay Act
B. The Fair Labor Standards Act
C. The Regulatory Wage Act
D. The Subsistence Pay Act
E. The Legal Pay Act
Which of the following is true regarding types of liens?
A. Types of liens include consensual, statutory, and judgment, but not approved or
evaluated.
B. Types of liens include consensual and statutory, but not judgment, approved, or
evaluated.
C. Types of liens include consensual and judgment, but not statutory, approved, or
evaluated.
D. Types of liens include judgment, statutory, approved, and evaluated but not
consensual.
E. Types of liens include consensual, statutory, judgment, approved, and evaluated.
Which of the following types of insurance protects the producer or manufacturer of a
good from loss incurred by people who are injured using the good?
A. Contractors' liability
B. Strict liability
C. Product liability
D. Business operations
E. Consumer protection
What is the basic premise of contract law?
A. To effectuate the expectations of the parties to an agreement
B. To promote commerce
C. To promote economic growth
D. To promote interstate commerce
E. To encourage a free-market society and greater financial security for the parties
Which of the following was the result on appeal in Gotlin v. Lederman, the case in the
text involving whether the defendants misrepresented the effectiveness of a particular
form of cancer treatment, Fractionated Stereotactic Radiosurgery (FSR), in violation of
New York's consumer protection law?
A. The court ruled that plaintiff was unable to recover because there was no evidence of
deceptive statements made on the part of the defendants.
B. The court ruled that the plaintiff was unable to recover because the consumer
protection law at issue did not apply to the provision of medical services.
C. The court ruled that the plaintiff was unable to recover because of the absence of
expert medical testimony establishing that the treatment was ineffective.
D. The court ruled that as a matter of law the plaintiff was entitled to recover because
evidence indicating the ineffectiveness of the treatment was presented.
E. The court ruled that the case was wrongfully dismissed prior to trial because issues
of material fact were presented regarding the plaintiff's injuries and whether the
marketing of the treatment was deceptive treatment.
