Archives: Quiz

A minor may not disaffirm an executed contract. A restrictive covenant is temporary and binds only the present owner of property. Answer: F Stock with no printed value is known as ____________________ stock. Answer: no-par A bearer instrument is negotiated […]

A tenant remains obligated on a lease even though the tenant subleases the premises. Unreasonable personal conduct that causes damage to someone else is called ____________________. Answer: nuisance Law actually refers to the duties imposed upon people requiring them to […]

The owners of several stores in a shopping center agreed on certain hours during which they would remain open. Is this an unfair trade practice? Why or why not? A voidable contract is completely enforceable against all parties unless and […]

Most civil cases are settled before they go to trial. Ordinarily, if an agreement is completely executory, the minor’s failure to act after reaching majority is considered an act of ____________________. Answer: disaffirmance ____________________ is defamation expressed in writing. Answer: […]

The right to cut down trees on a neighbor’s land is called a license. Only real property that is owned by private interests can be acquired through adverse possession. Answer: T One who receives benefits from a trust is called […]

Hospital, surgical, and medical insurance are often combined into one basic health insurance policy. A certificate of deposit is actually a loan by a depositor to a bank. Answer: T The purchase of a home is usually financed by a […]

Generally, the trend in modern court cases is that anyone who is injured by a defective product may sue. The landlord is always liable to a guest injured in the tenant’s apartment. Answer: F If a contract is rescinded, the […]

One type of relationship between a bank and a depositor is that of debtor-creditor. A court must enforce the terms of a written sales contract, even if they are unfair. Answer: F If two parties enter into an agreement that […]

A signed instrument lacking some piece of information may be transferred to another person with the authority to complete the instrument according to instructions. Two remedies available to persons at equity are ____________________ and ____________________. Answer: injunction; specific performance specific […]

Wilkes, a wealthy man, took out a life insurance policy and named his doctor, Byron, as the beneficiary. At Wilkes’s death, may Byron collect the proceeds? If both parties to an illegal agreement are in pari delicto, neither party can […]

Any increased risk caused by the insured releases the insurer from liability. Goods that are fit for the purpose for which they would ordinarily be used are called ____________________. Answer: merchantable goods> Under what circumstances can the parol evidence rule […]

The savings feature of life insurance is called the cash value. The rights and duties of the landlord and the tenant set out in a lease are known as warranties. Answer: F The formal, written accusation by a grand jury […]

Jurors selected to serve on a civil trial jury are called grand jurors. Preferred stockholders have first claim on the assets of a corporation if the corporation dissolves. Answer: F A(n) ____________________ occurs when a group of investors buy all […]

A person who buys stolen property may be guilty of conversion. Remedies for breach of sales contract under the UCC are intended to place the injured party in as good a position as if the contract had not been breached. […]

A written contract needs at least one witness to establish its existence and its terms. What is identity theft? What can individuals do to make this crime more difficult for criminals? Answer: Refer to pages 57 and 58 of the […]

An executory contract is one that has not been fully performed by one or all of the parties. Clauses in contracts prohibiting assignments and delegations are invalid. Answer: F An actual ____________________ of ____________________ occurs when one party to a […]

Administrative regulations have the same force and effect as statutes and court decisions. A person can be both an agent and an employee at the same time. Answer: T Only the buyer may insert contingencies in the contract of sale. […]

It is more difficult for a(n) ____________________ to prove libel or slander than it is for a private citizen. The right of a minor or other incompetent party to avoid a contract is called ____________________. Answer: disaffirmance The principal usually […]

An employer has the right to ask potential employees questions about their race, religion, and nationality. Mistakes about a contract may be either unilateral or mutual. Answer: T If a person unknowingly deals with an unlicensed individual, the courts will […]

Tax liens are granted to a government agency to ensure the payment of property taxes. An agency that may not be unilaterally revoked by the principal is a(n) ____________________. Answer: agency coupled with an interest Offering to take someone to […]

An unconscionable agreement is one that is grossly unfair. A witness is willing to give evidence in court that would be helpful to one of the parties to a lawsuit. However, she lives in another state and is unable to […]

Violations of business ethics occur only in large corporations. Duress and undue influence have the same meaning. Answer: F In many states, usury is a crime. Answer: T Braun issued a $35 check to Rice. Rice took the check to […]

Laws enacted by both state and federal governments to prevent monopolies are called ____________________. An architect not paid for services may file an artisan’s lien. Answer: F Liability for injuries on flights within the United States is determined by ____________________. […]

Usury laws protect borrowers from paying excessively high interest rates. Remedies for breach of sales contract under the UCC are available only to the buyer. Answer: F In a civil lawsuit during a pretrial proceeding, if the defendant’s attorney claims […]

If the seller breaches the contract but no real damages occur, a court is likely to award punitive damages to the buyer. A secondary party cannot limit her or his liability by a qualified indorsement. Answer: F A carrier may […]

To be valid, a gift must be made in writing. A misdemeanor is the most serious offense against the state. Answer: F Prior to an offer being made by one party, the parties may talk back and forth. This procedure […]

Property damaged by a hit-and-run driver is covered by uninsured motorist insurance. Money damages awarded for a breach of contract are an example of a legal remedy. Answer: T Exculpatory clauses relieve a party in advance for liability for the […]

The ____________________ is the agreed-upon amount of a loss paid by the insured. If your neighbors continue to do things on their property that disturb you, you can sue them for the tort of nuisance. Answer: T The chapter of […]

Nonwage extras given to employees by employers are called ____________________. Business Ethics is the inquiry into the moral judgment people make in deciding what is right or good in their daily lives. Answer: F Udall issued a $400 check to […]

____________________ is acquiring real property by occupying it for a long period of time without the owner’s consent. A principal is liable only for acts the agent is authorized to perform. Answer: F A cooperative may be treated as either […]

If a person wishes to join an existing partnership, all existing partners must agree to admit that person. Accidentally killing a person while driving in an intoxicated condition is an example of a situation in which the family of the […]

If the contract put in writing is intended to be the final and complete agreement between the parties then it is considered as a(n) ____________________contract. The UCC allows a sales contract to be enforced as long as the parties intended […]

A bailment that benefits only one party is known as a(n) ____________________ bailment. A secured creditor may repossess the debtor’s property and sell it to pay the debt. Answer: T A buyer may sue for ____________________ to obtain the goods […]

The Occupational Safety and Health Administration is a state administrative agency. Indorsers of negotiable instruments are primarily liable for payment of the instrument. Answer: F If a contract is required to be in writing, an assignment of that contract must […]

A partnership can be formed only by the express agreement of the parties. The Magnuson-Moss Warranty Act requires manufacturers to provide written warranties. Answer: F> A creditor has an absolute right ____________________. Answer: to get paid Emancipated minors are generally […]

Crane sold a house to O’Brien, unaware that there was asbestos in the walls. May O’Brien sue Crane for fraud or to rescind the contract of sale? A(n) ____________________ is a transfer by a tenant to another of his or […]

A bank may refuse to pay a depositor’s check for any reason. Courts enforce law by imposing punishment for violations or awarding damages to ones who have been injured. Answer: T In order to protect the environment, government may regulate […]

Black and Conway owned an office building as tenants in common. Black died. To whom does Black’s interest in the office building pass? An employer who violates the Occupational Safety and Health Act may be fined and may be subject […]

Why does the law protect minors in their dealings with adults? Obtaining an easement by ____________________ is similar to the concept of adverse possession. Answer: prescription If a creditor believes that a debtor may sell or transfer assets, the creditor […]

In a breach of warranty suit, damages are the amount needed to correct the defect. What makes an exculpatory clause illegal and against public policy? Answer: When the person or organization succeeds in its demand that an exculpatory clause be […]

Harris Manufacturing delivered goods to a railroad for shipment to a customer. While in transit, the goods were destroyed in a fire caused by lightning. Is the railroad liable for the loss? Defenses are the reasons offered by a defendant […]

While skiing, Carey fell and broke his leg and was unable to work for two months. What type of insurance would cover Carey’s medical bills and loss of income? A(n) ____________________ is a guarantee by a seller that a product […]

Ruth, an agent, was asked by her principal to also sign a contract involving the sale of merchandise to Flower. If the contract is breached, may Flower sue both Ruth and her principal for damages? Part of the purchase price […]

An assignment has no effect until the obligor is notified. What conditions must be met in order for a person to be accused of a material alteration? Answer: An alteration is material if the rights or duties of the parties […]

Under the UCC, a change in an existing contract must be based on consideration. Under the common law, a contract can be discharged for circumstances beyond the control of the parties if the contract contains a(n) ____________________. Answer: contingency clause […]

A debtor’s property may be seized and sold to pay off a debt. Under Article 2 of the UCC, a purchaser obtains only such ____________________ to goods as the seller had. Answer: title A limited partnership is a hybrid between […]

What is the difference between an express warranty and an implied warranty? The qualifications of potential jurors are determined through a process called voir dire. Answer: T An executor’s written promise to pay a deceased person’s debts out of personal […]

____________________ of a promissory note back to the maker will cancel it. A power of attorney is an example of express authority. Answer: T ____________________ govern the types of transactions that can be performed on Sunday. Answer: Sunday laws; Blue […]

Major medical insurance protects against the high costs of serious illness. A promise to pay a reward to a police officer for capturing a criminal is not legally enforceable. Answer: T A void contract has no legal effect. Answer: T […]

The rights read to a suspect upon arrest are called the ____________________. A(n) ____________________ agent has the authority to perform acts that relate to all business affairs of the principal. Answer: general Services of an attorney are personal in nature, […]