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When may a buyer revoke acceptance if a nonconformity substantially impairs the
value of goods?
A. For any reason within 24 hours of acceptance.
B. For any reason within 48 hours of acceptance.
C. For any reason within 7 days of acceptance.
D. For any reason within 30 days of acceptance.
E. Only if the buyer had a legitimate reason for the initial acceptance.
The ______ requirement ensures that courts do not render advisory opinions.
A. Attachment
B. Subject-matter jurisdiction
C. Case or controversy
D. In rem
E. In personam
Which of the following titles of the United States Code contains the Bankruptcy Code?
A. Title 9
B. Title 11
C. Title 7
D. Title 15
E. Title 34
When the articles of partnership do not address the matter, which of the following is
true regarding a partner's right to sell a partnership interest to a creditor?
A. A partner can sell his or her interest in a partnership to a creditor.
B. A partner cannot sell any of his or her interest in a partnership to a creditor.
C. A partner can sell only up to 75% of his or her interest in a partnership to a creditor.
D. A partner can sell only up to 50% of his or her interest in a partnership to a creditor.
E. A partner can sell only up to 25% of his or her interest in a partnership to a creditor.
For how long does registration on the Federal Trade Commission's "Do Not Call"
registry last?
A. Two years
B. Three years
C. Four years
D. Five years
E. There is no set expiration date
Which of the following is false regarding the Mexican Securities Market?
A. Existing laws permit non-Mexican entities to issue securities.
B. Existing laws do not limit investments in securities outside Mexico by Mexican
individuals or companies.
C. The Mexican Stock Exchange is a private sector corporation owned and operated by
authorized brokerage dealers.
D. The Mexican Stock Exchange requires that dealers complete all transactions on a
cash basis and settle them within a 48-hour period.
E. The National Security Commission (CNV) regulates public offerings and securities
trading.
"Boat Tow." Donnie went to a new car dealership and told the salesperson, Sally, who
was not the manager, that he needed a new car that would get good gas mileage and
would also pull his big boat. Sally encouraged him to buy a smaller car that she
promised would pull the boat. Sally was new to the job and did not realize that the
small car did not have sufficient power to pull the boat for any distance. Donnie bought
the car and used it to pull the boat. Unfortunately, the heavy pull on the car did
significant damage to the car's engine. Donnie complained to the Sally who denied any
liability. Donnie, who had half a semester of business law, informed Sally that along
with the sale of the car he also received an express warranty, an implied warranty of
merchantability, and an implied warranty of fitness for a particular purpose; and that he
could recover under any of those theories. Sally truthfully said that no explicit promises
regarding warranties were ever made orally or in writing.
Is Donnie correct that the car was sold with an implied warranty of fitness for a
particular purpose?
A. Yes, because it was promised that the car would pull the boat.
B. No, because Sally was only engaged in puffing.
C. No, because only the manager can make such a warranty.
D. No, because Sally made only a warranty of merchantability, not a warranty of fitness
for a particular purpose.
E. No, because no implications were made.
Which of the following requires that the breaching party fulfill the terms of the
agreement?
A. Specific obligation
B. Specific performance
C. Absolute obligation
D. Identified obligation
E. Absolute performance
"Contraceptive Injuries." Drug company ABC Drugs came out with a new birth control
pill guaranteed to prevent pregnancy for one year after the consumption of one pill. The
FDA approved warnings of the drug's side effects including nausea and headache to be
provided with the pill. After it was initially put on the market, the company became
aware of some risks of dizziness from taking the drug. The company, however, did not
warn of that risk because the company was concerned that individuals might not buy
the pill, and federal law did not specifically require a warning regarding dizziness.
Belinda thought the pill was a great idea and obtained a prescription for it at a date after
the company became aware of the issues involving dizziness. She took one and felt fine
for a few days. Then, however, she began feeling dizzy. Her dizziness caused her to fall
breaking her leg on some steps. She later discovered that the birth control pill likely
made her dizzy. Belinda decided to sue under a state law claim for failure to warn,
however, she waited a number of years before bringing her action. The drug company
claimed that it had no duty to list dizziness as a risk because its warning complied with
all FDA requirements. The drug company also claimed that the time in which it could
be sued had expired both because Belinda waited too long after she was injured and
also too long from the date of product purchase. What is the most likely result regarding
the company's position that it had no duty to warn of the risk of dizziness because it
complied with FDA requirements?
A. That the Federal Food, Drug, and Cosmetic Act (FDCA) establishes both a floor and
a ceiling for drug regulation and that no additional warning requirements regarding
dizziness could be imposed.
B. That absent clear evidence that the FDA would not have approved a change in the
warning to include dizziness, a state law cause of action based on failure to warn would
be allowed.
C. That no warning regarding dizziness could be required in addition to FDA approved
warnings because dizziness is not a serious condition causing a "black box" type of
warning involving risk of serious injury death.
D. That a state law cause of action would be allowed to go forward only upon the
submission of clear evidence that a regulatory agency of the state had requested that the
warning label be revised to warn of dizziness.
E. That while the plaintiff could go forward with a federal claim in relation to the lack
of a warning regarding dizziness, a state law cause of action would be barred because of
the company's compliance with FDA regulations.
"Disputed Ring." While working in the yard Tina found a beat up ring. Becca, an
eighteen-year-old teenager and neighbor, came over to visit and liked the ring. Tina
said, "You can have this old thing if you would like." Becca replied, "I really like it -
Maybe it's a real diamond!" Tina laughingly told her that there was a one in a billion
chance of that and that Tina was more likely to win the lottery. A few months later
Becca ran over to Tina's house and told Tina that the ring was actually a diamond worth
thousands! Becca gave Tina the ring to examine. Tina put it in her pocket and told
Becca that she would never have given it to her if she had realized its value and that
possession was back where it had always belonged. Tina also told Becca that Becca
failed legally to accept the gift because neither party knew its true value and that
because Tina did not sign any document turning over title, it was impossible for legal
ownership to pass. Becca sues.
Which of the following is true regarding Tina's statement that she was entitled to the
ring because she would not have given it to Becca if she had known the true value?
A. Tina is entitled to ownership of the ring if she can prove that she did not realize its
true value.
B. Tina is entitled to ownership of the ring only if she can prove that she did not realize
its true value, and also that there was a difference of at least $1,000 between what she
believed the value to be and its true value.
C. Tina is entitled to ownership of the ring only if a jury determines that she was not
negligent in failing to recognize its value.
D. Tina is not entitled to ownership of the ring because she admitted that there was at
least some chance (one in a billion) that it was a genuine diamond.
E. Being ignorant of the value of the ring does not entitle Tina to ownership of it.
Which of the following involves the legal enforcement of an otherwise unenforceable
contract due to a party's detrimental reliance on the contract?
A. Promissory estoppel
B. Substantial estoppel
C. Promissory rule
D. Reliance rule
E. Promissory reliance
Which of the following was the result in Almetals Inc., v. Wickeder Westfalenstahl,
GMBH, the case in the text involving the sale of a specialty metal in which the plaintiff
sued the defendant for breach of contract seeking specific performance?
A. That specific performance was unavailable because real estate was not involved.
B. That specific performance was unavailable because a foreign defendant was involved
and jurisdiction for specific performance was, therefore, lacking.
C. That specific performance was unavailable because the goods at issue were scarce.
D. That specific performance was unavailable because a requirements contract was
involved.
E. That specific performance was the appropriate remedy because the goods at issue
were unique with no known alternative sources of supply.
When a plant emits particulates that fall on a person's property, defacing the house and
making it difficult for family members to breathe, which of the following is a theory on
which the homeowner would most likely proceed?
A. Negligence
B. Strict liability
C. Abatement
D. Nuisance
E. Trespass
A person with an interest in a will, such as that of a potential beneficiary is said to have
_____.
A. Standing
B. Vesting
C. Heirship
D. Acknowledgement
E. Consideration
Which of the following was the result in the case in the text Adone v. Paletto involving
the rejection of a purported acceptance of an offer of compromise because it was not
made within the time limit of 10 days specified in the offer?
A. Rejection of the acceptance was unjustified because offers of compromise may not
contain time limits.
B. Rejection of the acceptance was unjustified because allowing only 10 days for
acceptance is unreasonable.
C. Rejection of the acceptance was unjustified because of the plaintiff's severe injuries.
D. Rejection of the acceptance was enforceable because a trial had already been held.
E. Rejection of the acceptance was enforceable because the 10 days in which the other
party had to accept had expired.
Once a financing statement has been filed with a correct agency, for how long is the
statement valid under the UCC?
A. 1 year
B. 2 years
C. 3 years
D. 4 years
E. 5 years
Which of the following is true of the term "tort"?
A. It is a French word meaning "wrong."
B. It is a German word meaning "mistake."
C. It is a Latin word meaning "misfeasance."
D. It is an English word meaning "negligence."
E. It is a civil law term meaning "liability."
Under the UCC, courts allow parties to explain or supplement a written contract with
which of the following?
A. Additional terms that are consistent with the terms in the agreement, evidence that
helps the court interpret the agreement, and any evidence as to price.
B. Evidence that helps the court interpret the agreement, but not additional terms that
are consistent with the terms in the agreement or any evidence as to price.
C. Any evidence as to price, but not additional terms that are consistent with the terms
in the agreement or evidence that helps the court interpret the agreement.
D. Additional terms that are consistent with the terms in the agreement, but not
evidence that helps the court interpret the agreement or any evidence as to price.
E. Additional terms that are consistent with the terms in the agreement and evidence
that helps the court interpret the agreement, but not any evidence as to price.
In an auction _________, the seller is treated as making an offer to accept the highest
bid.
A. Without controls
B. With controls
C. Without reserve
D. With reserve
E. Without qualifications
"DUI Charge." Monique was licensed by her state to train massage therapists. The state
licensing agency, the Aesthetic and Massage Commission, took very seriously its role
of enforcing the state statute enabling the Commission to do its work and providing that
licensed massage therapists must refrain from "any act or conduct indicating bad faith,
incompetence, dishonesty, or improper dealing." Rules were passed authorizing the
agency to revoke the license of anyone found guilty of such acts or conduct. Monique,
while driving home late one night from a party, was stopped by the police and arrested
for driving under the influence of alcohol. She pled guilty to the offense. When the
Aesthetic and Massage Commission discovered the offense, the officials of the agency
met, decided that Monique might drink on the job, and that she might pose a danger to
students. Accordingly, her license to teach massage therapy was revoked. Monique
threatened to sue to retain her license and was told by the agency head that she had no
right to appeal to court because, based on her admission of guilt, no factual dispute was
involved. The agency official went on to say that even if an appealable issue existed,
agency action may only be overturned when there is clear and convincing evidence that
the agency exceeded its discretion. The administrative system in Monique's state is
identical to the federal system.
Which of the following would likely be the result if Monique appeals to court after she
is unable to resolve the issue through the agency?
A. Her appeal would be immediately dismissed by the judge because she had no right to
an appeal a decision of an agency of this type.
B. She would lose unless she could establish that she was singled out for unfair
treatment based on a review of others in her position who pled guilty to similar charges.
C. She would lose unless she could establish bias against her because of her race, color,
gender, age, or national origin.
D. She would lose because courts will review agency interpretations of regulations only
when there is clear and convincing evidence of a factual dispute which is nonexistent
because she pled guilty to the DUI charge.
E. She would likely win because it appears that the agency exceeded its authority under
the statute in that her DUI conviction did not involve matters, such as honesty, that the
statute was meant to protect.
Selma agreed to buy a used car from Hillary for $2,000. Hillary drew up the contract
providing that the exchange would occur the next week. Unfortunately, Hillary was not
very good with the keyboard and typed in $1,200 as the price of the car. Selma noticed
that the contract said $1,200, not $2,000, and was very pleased. She signed it without
saying anything. When it was time to make the exchange, Selma gave Hillary $1,200.
In response to Hillary's inquiry regarding an additional $800, Selma pulled out the
contract and showed her that it said $1,200. Hillary immediately responded that she had
made a typographical error. Selma said that there was no mistake on her part because
she knew exactly what she was doing and that she thought that Hillary had decided to
give her a deal on the car. Which of the following is Hillary's best argument for a
rescission of the contract?
A. That a unilateral mistake was involved and that courts typically allow relief in
situations involving unilateral mistakes as opposed to mutual mistakes.
B. That the mistake resulted from a sale of goods, as opposed to the provision of
services, and that courts are more likely to grant relief for a mistake when actual
physical work is not involved.
C. That because a bilateral contract, as well as a unilateral mistake was involved, most
courts would grant relief.
D. That the mistake resulted from an accidental clerical error and that it would be
unconscionable to enforce the contract.
E. That duress was involved because of Selma's wrongful behavior.
"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 Jan's statement to Billy that he had no right to
assign the contract?
A. Jan is correct because a personal type of service was involved.
B. Jan is correct because the contract did not specifically give Billy the right to assign
the contract.
C. Jan is correct because a delegation as well as an assignment was involved.
D. Jan is incorrect because the contract was not a personal service, and there was no
requirement that the contract specifically reference the right to assign rights and duties.
E. Jan is incorrect only because the contract and assignment were for an amount under
$1,000. Otherwise, Billy had no right to assign the contract without her permission.
"Weeds." Susie developed a product guaranteed to immediately kill weeds, but
absolutely no other type of grass or shrub. She has encountered several individuals and
businesses in other countries who would like to enter into contracts with her and market
her products internationally. She went to Willie, who just graduated law school and has
yet to pass the bar, and asks him for advice regarding those contracts. Willie proceeded
to tell her that she should simply enter into the same type of contract with international
businesses and individuals from other countries as she would if those individuals and
businesses were located in the United States. He tells her that if there is any problem,
then they will simply have to come to the United States to settle the matter, and that any
issues would be determined in Susie's home county, in her home state, and under her
state's law. He also mentions to her that she should consider contacting local foreign
officials in the areas in which she would like her product sold and suggest to them that
she can contribute heavily to election campaigns if she is allowed without any hassles
to obtain necessary business licenses and approvals to do business.
Assuming Susie wants some additional protection to guarantee that any dispute with
international business will be resolved in her state in the U.S., what should she do?
A. There is nothing she can do.
B. She should put a forum selection agreement clause within the contract.
C. She should put a choice of law provision in the contract.
D. She should put a choice of general jurisdiction clause in the contract.
E. She should put a Hague clause in the contract.
Assuming a buyer that is insolvent has breached a contract by not paying for goods that
are in transit, which of the following may occur?
A. The carrier may stop delivery on the entire shipment.
B. The carrier may stop delivery only if the quantity shipped is a large shipment such as
a carload or truckload.
C. The carrier may stop delivery only if a signed writing exists by which the buyer
agreed to the remedy of stopping shipment.
D. The carrier may stop delivery only if ordered to do so by the bankruptcy judge.
E. The carrier may not stop delivery under any circumstances.
Under which of the following does a principal give authority to an agent only for the
specific areas or purposes listed in the agency agreement?
A. A specific power of attorney
B. An exact order of authority
C. An exact legal empowerment
D. A limited power of responeat superior
E. A specific power of order
"Pet Pig Farm." Marcy wanted to buy Lucy's land and use it to breed small pigs to be
kept as pets. Marcy told Lucy that having water on the property was very important
although she did not mention to Lucy her plan to breed small pigs. Lucy assured her
that a spring ran through one corner of the property. Therefore, Marcy agreed to buy the
farm. Marcy, who loved pigs, assumed that the neighbors would be pleased with the
pigs being in the area. Lucy also agreed to sell Marcy a used truck for $5,000. After the
contract for the land sale was entered into, Marcy had a land survey done, and it was
discovered that actually the spring did not run through the corner of Lucy's property.
The area in which the spring ran actually belonged to a neighbor. Additionally, when
Lucy brought Marcy the used truck, Marcy said, "That's not the truck!" It was
discovered that Lucy, who had two trucks, thought that Marcy had bought the older
truck although Marcy thought she had purchased the newer truck. Marcy was also
surprised when she received a petition signed by all surrounding landowners objecting
to the presence of the pigs and threatening to sue Marcy for nuisance. It will cost Marcy
more than she had agreed to pay Lucy in order for Marcy to obtain a similar farm which
actually has a spring on it.
Which of the following is the most likely result in the dispute between Marcy and Lucy
regarding which used truck was sold assuming that both Marcy and Lucy were
innocently mistaken and did not intend to defraud the other?
A. The contract will be rescinded.
B. Marcy will be allowed to pick the truck she wants to buy because she is the buyer,
and she may also recover damages.
C. Lucy will be allowed to pick the truck she wants to sell because she is the seller.
D. Marcy will be allowed to pick the truck she wants to buy because she also had a
contract on the ancillary farm.
E. Marcy will be allowed to pick the truck she wants to buy because she is the buyer,
but she may not recover damages.
Which of the following is true regarding an award of attorney fees under Title VII?
A. Attorney fees are always awarded to the prevailing party in Title VII cases.
B. Similar to attorney fees in a motor vehicle accident lawsuit, attorney fees are never
awarded to the prevailing party in Title VII cases.
C. Attorney fees may be awarded to a successful plaintiff in a Title VII case and are
typically denied only when special circumstances would render the award unjust, but
attorney fees are not awarded to prevailing defendant.
D. Attorney fees are not awarded to prevailing plaintiff; but if it is determined that a
plaintiff's action was frivolous, unreasonable, or without foundation, the courts may
award attorney fees to the prevailing defendant.
E. Attorney fees may be awarded to a successful plaintiff in a Title VII case and are
typically denied only when special circumstances would render the award unjust; and if
it is determined that a plaintiff's action was frivolous, unreasonable, or without
foundation, the courts may award attorney fees to the prevailing defendant.
What was the result on appeal in the case in the text Alaska Pacific Trading Co. v.
Eagon Forest Products Inc. in which the defendant rejected a shipment of logs, and the
plaintiff/seller claimed that its late shipment was excused because the contract did not
specify that time was of the essence?
A. That by not shipping the logs in a timely manner according to the contract, the seller
failed to satisfy the perfect tender rule thereby releasing the defendant buyer from its
duty to accept the logs.
B. That the seller satisfied the perfect tender rule although the logs were late and that
the defendant buyer breached the contract by refusing to accept the logs.
C. That the seller was entitled to rely on the common law doctrine of material breach
but that the seller did not substantially perform thereby releasing the buyer from
contractual duties.
D. That the seller was entitled to rely on the common law doctrine of material breach,
that the seller substantially performed, and that the buyer was in breach.
E. That the seller was entitled to rely on the perfect tender rule and that the buyer
materially breached the contract by refusing to accept the logs.
Which of the following are outside directors who have business contacts with the
corporation?
A. Approved directors
B. Associated directors
C. Inside directors
D. Affiliated directors
E. Unaffiliated directors
"Book Sale." Beverly offered to sell Rick a used business law book for $50. She told
him that he could use it in his upcoming business law class the next semester. In fact,
there was a problem with the book; it was several editions old. Rick was not aware of
that fact, and neither was Beverly. When Rick took the book to class and realized the
problem, he went back to Beverly requesting a refund. Beverly refused to return his
money. She claimed that subjectively she thought that the book was correct, that she did
not commit fraud, and that a binding contract existed. The book, however, is outdated
and cannot be appropriately used in the class.
Which of the following would describe Beverly's role in the transaction?
A. She was the offeror.
B. She was the offeree.
C. She was the assentor.
D. She was the assentee.
E. She was the offeree and the assentee.
Which of the following was the result in Paula E. Rossman v. Fleet Bank (R.I.)
National Association, the case in the text in which the plaintiff sued the defendant after
she opened a credit card account based on the promise that no annual fee would be
charged; but the policy was changed shortly thereafter, and she was charged an annual
fee?
A. That the defendant was liable to the plaintiff because it engaged in a bait-and-switch
scheme.
B. That the defendant was liable to the plaintiff because it violated provisions of the
Truth in Lending Act.
C. That the defendant committed no violation of the law because it was entitled to
change its policies at will.
D. That the defendant committed no violation of the law because its offer disclosed that
terms and policies could be changed.
E. That the defendant committed no violation because it was not required to disclose
future fees, only current ones.
Which of the following is not a reason for which leave may be requested under the
Family and Medical Leave Act?
A. The care of a seriously ill parent.
B. The birth of a child.
C. The adoption of a child.
D. The need for fertility treatments in order to conceive.
E. The placement of a foster child in the employee's care.
Which of the following is true regarding what is considered an interest in land within
the statute of frauds?
A. Interests in land within the statute of frauds include promises to sell crops annually
and agreements between parties for profit sharing from the sale of real property, but not
boundary disputes that have been settled through the use of land.
B. Interests in land within the statute of frauds include promises to sell crops annually,
but not agreements between parties for profit sharing from the sale of real property or
boundary disputes that have been settled through the use of land.
C. Interests in land within the statute of frauds include boundary disputes that have been
settled through the use of land, but not promises to sell crops annually or agreements
between parties for profit sharing from the sale of real property.
D. Interests in land within the statute of frauds include boundary disputes that have
been settled through the use of land and promises to sell crops annually, but not
agreements between parties for profit sharing from the sale of real property.
E. Interests in land within the statute of frauds include promises to sell crops annually,
agreements between parties for profit sharing from the sale of real property, and
boundary disputes that have been settled through the use of land.
