1) The party against whom a lawsuit is brought is the plaintiff or petitioner.
2) Most states do not allow automobile repair shops to hold a customer’s car when the
customer refuses to pay for repairs already completed.
3) A bank may not charge a postdated check against a customer’s account unless the
customer notifies the bank, in a timely manner, to pay the check before the stated date.
4) The protection of an individual’s right to his or her property has become one of our
most important rights.
5) The checks and balances in the U.S. Constitution prevent any one branch of
government from exercising too much power.
6) A sole proprietor is free to make any decision he or she wishes concerning the
business.
7) An exception to liability for copyright infringement is made under the “fair use”
doctrine.
8) A transfer of contract duties to a third party is an assignment.
9) Under the Madrid Protocol, a company can register its trademark in more than one
country with a single application.
10) Penalties for aiding or assisting in the preparation of false tax returns are limited to
one penalty per taxpayer per tax year.
11) A seller with voidable title has the power to transfer good title to a good faith
purchaser for value.
12) Fact Pattern 3-B2
Martin files a suit against Nichelle in a state court over payment due on a short-term
employment contract. The case proceeds to trial, after which the court renders a verdict.
The case is appealed to an appellate court.
Refer to Fact Pattern 3-B2. After a final determination in the case of Martin v. Nichelle,
any judgment will be satisfied
a.if the losing party pays the judgment.
b.if the winning party has sufficient assets to cover the amount of damages sought.
c.if the losing party proves that he or she is unable to pay the judgment.
d.all of the choices.
13) La-Z Days Motels, Inc., and Beds R Us Corporation enter into a contract that does
not specify the payment terms. Payment may be made in
a.any commercially normal or acceptable means except credit card.
b.cash only.
c.any commercially normal or acceptable means.
d.cash or check only.
14) Gliding Light, LLC, and Hang Gliders, Inc., are parties to a contract. They subse-
quently agree that High Riders Inc. should take Gliding Light’s place and assume all of
its rights and duties under the contract. This is
a.a mutual agreement to rescind.
b.an accord and satisfaction.
c.a novation.
d.a settlement agreement.
15) SmartPhone Company’s ad states that its product is “The Best that Money Can
Buy.” Because of this ad, the Federal Trade Commission is most likely to issue
a.a cease-and-desist order.
b. a counteradvertising order.
c.a multiple product order.
d.none of the choices.
16) Reed prepares federal corporate income tax returns for Shopping Malls, Inc., and
other firms. Under the Internal Revenue Code, with respect to an understatement of a
client€s tax liability, Reed may be liable for
a.negligent or willful misconduct.
b.no misconduct.
c.only negligent misconduct.
d.only willful misconduct.
17) Fact Pattern 9-B1
Great Looks Clothing Corporation sends daily e-mail ads to its previous customers and
those who have opted to receive the notices. Hot Trends Inc. sends e-mail ads to any
e-mail address that Hot Trends can find on the Web or otherwise generate. Ilene sends
e-mail notes to her friends, relatives, and co-workers, discussing personal issues and
recommending products or services that she likes.
Refer to Fact Pattern 9-B1. Great Looks and Hot Trends are subject to the laws of the
states in which they are located and do business. Many states
a.prohibit false and deceptive e-mailing practices.
b.require the use of spam by business entities.
c.ban the use of spam altogether.
d.preempt the application of federal law to commercial e-mail.
18) Facetime Social Media Inc. sells its users’ personal information. This may violate
a.businesses’ duties to their customers.
b.individuals’ rights to their privacy.
c.governments’ duties and rights with respect to public welfare.
d.no rights or duties.
19) Drake enters into a contract with Eve, who claims to have access to a stock-trading
algorithm that will multiply an investment many times over. When the results do not
match this promise, Drake learns that Eve does not have access to any unique software
and files a suit against her, alleging fraud. Proof of an injury is required to
a.recover damages.
b.rescind the contract.
c.undo Eve’s influence.
d.punish the defendant.
20) Loading Ramps Plus Inc. contracts to sell sixteen aluminum loading ramps to
Moving Services, Inc. Loading Ramps ships the ramps, which Moving Services accepts
but does not pay for. Loading Ramps can
a.sue to recover the purchase price plus incidental damages.
b.sue to recover the purchase price minus incidental damages.
c.resell the ramps to any buyer willing to reclaim them from Moving Services.
d.require Moving Services to revoke its acceptance of the ramps.
21) Willy deposits $5,000 with Home State Bank on July 1, 2012 . Home State Bank
promises to repay Willy the $5,000 plus 3 percent annual interest on July 1, 2017 . This
is
a.a certificate of deposit.
b.a cashier’s check.
c.none of the choices.
d.a draft.
22) A holder cannot become an HDC if he or she has notice of any claim to the
instrument or defense against it.
23) In a lawsuit between Cloud Computing Corporation and Digital Enterprises, Inc.,
the court applies the doctrine of stare decisis. What is this doctrine? What does this
doctrine have to do with the American legal system?
24) Members of limited liability companies are shielded from personal liability in many
situations.
25) Performance can be accomplished by tender.
26) Francesca works for Glassworks Inc. Near her workstation is a conveyor belt that
runs into a large industrial oven. Some workers, including Harry, Francesca’s
supervisor, use the oven to heat food. One day, when the conveyor is not moving,
Francesca uses the oven to cook her lunch. As she removes the food from the oven, the
conveyor comes on and Francesca is pulled partially into the oven and suffers serious
burns. Francesca seeks recovery under the state workers’ compensation law. Should she
recover? Why or why not?
27) 8.Under the supremacy clause, a valid federal statute or regulation will take
precedence over a conflicting state or local law or regulation on the same general
subject.
28) A court€s review of an arbitrator€s award may be restricted.
29) A covenant not to sue does not always bar further recovery.