BUS I FINAL EXAM

Certain employers are required to keep occupational injury and health records for each employee, but due to privacy concerns, no employer is permitted to electronically post those records

False

Every party who signs a negotiable instrument is primarily liable for payment of that instrument when it comes due

False

In a case involving Internet transactions, jurisdiction is proper only when the defendant conducts substantial business in the jurisdiction online.

False

In a successful tort suit, an individual is awarded compensatory damages to put him or her in a better position than the party who committed the tort.

False

Odell is an employee of Packing Corporation. She uses social media in a way that violates her employer's stated social media policies. Packing disciplines Odell and then, after a second transgression, fires her. This is

within the employer's rights

Actual authority in an agency relationship arises from what a principal makes clear to a third party.

False

Cybersquatting is illegal only if a domain name is identical to the trademark of another, not if the name is merely confusingly similar.

False

Decision makers need to consider what they can and will do before they consider what they should do.

False

Even if it conflicts with the U.S. Constitution, a state constitution is supreme within that states' borders.

False

If a debtor's income falls below the median income in the area in which the debtor lives, there is a presumption of bankruptcy abuse

False

If a party is already bound by contract to perform a certain duty, that duty can serve as consideration for a second contract.

False

In a criminal case, typically only three-fourths of the jurors need to agree in order to convict the defendant

False

Service marks are not protected in the same way as trademarks.

False

The lack or failure of consideration is a personal defense and can be used to avoid payment to an ordinary holder, an HDC, and a holder through an HDC

False

To constitute the crime of bribery, the bribe must consist of money

False

Under the UCC, good faith can never be disclaimed

False

A trade name is used to indicate all or part of a business's name.

True

A truck driver who drives a company truck on a regular basis is most likely an employee.

True

Any debtor who is eligible for bankruptcy relief under Chapter 7 is eligible under Chapter 11.

True

Business as we know it could not exist without secured transactions because otherwise sellers and lenders would be less likely to sell and lend on credit

True

In a case based on diversity of citizenship, a federal court will apply the relevant state law.

True

Ken presents an instrument that states "pay to the order of Laura" to Metro Bank for payment. The most common type of negotiable instrument, this is

a check

A Chapter 13 proceeding is more expensive and complicated than a Chapter 11 or Chapter 7 proceeding

False

A statute is a secondary source of law

False

Any court can exercise jurisdiction over any property wherever it is located.

False

Appellate courts have no discretionary power to reject an appeal—appellate courts must accept all appeals

False

Because it may be unclear how a court will interpret and apply a law, companies can ensure decisions are viewed as ethical by documenting their own interpretation of the law

False

Both parties to an agency relationship have the power and the right to terminate the relationship at any time

False

Cybersquatting is legal when the person offering for sale a domain name that is the same as another's trademark intends to profit from the sale

False

Cybersquatting occurs when the owner of a trademark registers the mark as a domain name but does not use it for that purpose

False

If a bank pays a stale check in good faith but without consulting the customer, the bank has no right to charge the customer's account for the amount

False

One element necessary for an effective offer is the terms must be reasonable

False

Shipping Inc. employs five hundred workers. For the Occupational Safety and Health Administration, Shipping must do all of the following except

pay employees higher wages for working in more dangerous areas.

A principal has a duty to pay an agent in a timely manner the customary compensation for services rendered

True

Ethical decision makers should test and reflect on the outcome of their decisions.

True

If a court determines that a contract involving both goods and services is primarily a goods contract, any dispute over the deal will be decided under the UCC

True

If the evidence of a defendant's guilt was obtained improperly, it normally cannot be used against the defendant in court

True

In response to an order for a hundred baseballs, the shipment of a hundred basketballs is both an acceptance of the offer and a breach of the contract

True

It is frequently companies, rather than courts, that define the privacy rights of the companies' online users

True

Most crimes require an act of commission

True

Taking personal property from its owner, without permission or just cause, is trespass—retaining it is conversion

True

The contractual rights and duties of the bank and the customer depend on the nature of the transaction

True

Under the Statute of Frauds, a contract involving an interest in land must be in writing to be enforceable.

True

Under the principles of agency law, any sale of goods by a salesperson in a store to a customer can be binding on the owner of the store.

True

Debts that remain after a liquidation are not discharged, and the debtor retains his or her obligation to pay them

False

Even if the defects on a piece of property are obvious, the buyer can justifiably rely on the seller's misrepresentations concerning those defects

False

The shelter principle promotes the marketability of instruments by permitting a holder with notice of a claim or defense to attain HDC status by reacquiring the instrument from a later HDC

False

Those who do not make goods, but only sell or lease them, cannot be held liable for harm caused by those goods to a consumer.

False

To succeed in a suit for trademark infringement, the owner must show that the infringer acted intentionally

False

Under the Age Discrimination in Employment Act, the plaintiff must show that unlawful discrimination was only one of the reasons for an adverse employment action.

False

To succeed in a suit against a potential employer for discrimination under the Americans with Disabilities Act, a job applicant must show that he or she

was not hired solely because of a disability

A party to a contract who has no reason to know that the contract is illegal can often obtain restitution on a partially executed contract

True

Fiesta LLC contracts to buy 1,000 balloons from Gas Bags Inc. for $1 per item. When the market price decreases to 50 cents per balloon, Fiesta refuses to go through with the deal. Gas Bags can recover

$500

Grocers Mart buys one hundred cases of berries from Hilltop Farms. The parties agree that the berries will be transported "F.O.B. Hilltop Farms" via Refrigerated Trucking Company. Refrigerated's truck and the berries are lost in a fire following an accident. The loss of the berries is suffered by

Grocers

A bank must re-credit a customer's account when the bank pays a check on which the drawer's signature is forged

True

Business Sales Inc.'s debt to Cartage Company is past due. Cartage brings a legal action against Business Sales to collect. To ensure that a judgment in the creditor's favor will be collectible, Cartage asks the court to order the seizure of the debtor's property. This is a request for

a writ of attachment

Refresh Inc.'s debt to Spring Water Company is past due. Spring brings a legal action against Refresh to collect the debt. Spring asks the court to order Tempo Bank, in which Refresh has an account, to pay a portion of the funds to Spring. This is a request for

an order of garnishment

Brass Instruments, Inc., sells seventy-six trombones to Community Band. To avoid liability for most implied warranties, Brass should state in writing that the trombones are sold

as is

Candy Corporation orders Double Chocolate Bars from Edible Distribution Company. Edible identifies the goods. Before they are shipped to Candy, an insurable interest in the goods exists in

both Candy and Edible

Bottling Company enters into a contract with Chug's Brewery to provide certain bottling and delivery services. Before Bottling starts to work, the market price rises for the fuel for glass ovens. Bottling tells Chug's that due to the added cost it will not perform their deal. Bottling's contractual obligation to Chug's is

breached

Without the permission of the copyright owner, Faye copies the literary expression of Game of Thrones, changes the names of the main characters, and publishes the result as her own work. This is

copyright infringement

Obtaining a court order to close down the domain name of a website is an effective tool that U.S. officials use to combat online sales of

counterfeit goods

Via the Internet, Britta enters false code into the computer control system of Chicken Company, a food maker, to alter the levels of ingredients so that consumers of the food become ill. Britta is

cyberterrorist

Sloane drives into Tire Service and asks to have a tire replaced on her car. After the service replaces the tire, but before Sloane pays for it, any contract between them is

executory

Don enters into a contract to buy Ezra's office building for a certain price subject to an appraiser's evaluation of the structure's condition. If the appraiser deems the condition to be substandard, the parties' obligations will be

discharged

Quint files a suit against Ranchland Corporation. Ranchland believes that even if Quint's statement of the facts is true, according to the law Ranchland is not liable. Ranchland should

file a motion to dismiss

Volatile Investments Inc. sends e-mail ads to any e-mail address that the sender can find on the Web or otherwise generate. Under federal law, Volatile's marketing method

is prohibited

Emmett, an agent for Fridley, signs an agreement with Glover on Fridley's behalf but neglects to tell him that the agreement requires the payment of a certain tax. The government prosecutes Fridley for failing to pay the tax. He is

liable, because notice to Emmett is notice to Fridley

Fred has six nieces, ages five to sixteen. He writes an order instrument for $50 that states "Pay to the order of my niece." The order instrument is

nonnegotiable, because there is no specific person identified

Edna is the payee of a bearer instrument—a promissory note in the amount of $10,000. Flem offers to irrigate Edna's ranch next week in exchange for the note. She agrees and delivers the note to Flem. Flem is

not an HDC, because he did not yet give value for the instrument.

To be protected under the Copyright Act, a work must be

original and fixed in a durable medium

Lake City enacts an ordinance that bans the distribution of all printed materials on city streets. Mackenzie opposes the city's latest "revenue-enhancing" measure and wants to protest by distributing handbills. In her suit against Lake City, a court would likely hold the ban on printed materials to be

unconstitutional under the First Amendment.

Viaduct Corporation used untested and risky construction techniques to build a bridge under budget. The techniques were legal but the bridge collapsed, killing several people. Viaduct's actions were

unethical and may result in legislation to ensure it does not happen again.

On July 10, Bob's Pet Supply Store orders fifty small dog collars from Canine Collars, Inc. to be delivered by July 15. On July 13, Canine Collars tenders fifty large dog collars. Bob's rejects the shipment. Canine Collars has

until July 15 to cure

A merchant who is in the business of selling certain goods makes an implied warranty of merchantability every time she sells any type of merchandise

False

Corky pays Debit Bank $500 plus a service fee to draw a check on itself payable to Electric Company. The party responsible for paying the check is

Debit Bank only

Cato is driving a car in which Diego is a passenger when an accident occurs. Diego is not injured. In Diego's tort action against Cato for negligence, Cato can most likely assert as a successful defense that

Diego was not injured.

Erin indicates that she is acting as an agent on behalf of an unidentified client—Flight Services Inc.—when she enters into a contract with Go Airlines. Liability to Go for nonperformance of the contract may be imposed on

Erin and Flight Services

A customer can refuse to accept a substitute check created from the digital image of an original check as proof of payment

False

A holder who takes a negotiable instrument from a thief cannot become an HDC even if the item was acquired in good faith and there was no reason to be suspicious of the transaction

False

Heber, Irma, and Jon apply to work for Kitchen Chicken Inc. in Louisiana. These individuals' eligibility to work must be verified by

Kitchen Chicken

Lumber LLC files a suit against Mill Company to enforce an oral contract that would otherwise be unenforceable under the Statute of Frauds. The court could enforce such a contract if

Lumber foreseeably and justifiably relied on Mill's promise

Runners Feet, a shoe store, orders one hundred pair of athletic shoes from Speedster Inc. Absent a contrary agreement between the parties, title will pass to Runners Feet when

Speedster physically delivers the goods

In deciding whether conduct is sufficiently outrageous to support an action for infringement of emotional distress, a court looks at the pattern of the conduct.

True

Warranties of title arise automatically in most sales contracts and a thief breaches the warranty by selling stolen goods.

True

State University provides housing on campus and in some adjacent off-campus neighborhoods. To lease a university house or apartment, a person must be a student at State. This requirement is

a condition

Laura is the only female employee in the maintenance department of Motor Service Inc. Her supervisor teases and plays tricks on her so relentlessly that she feels compelled to quit. This is

a constructive discharge

Ana signs a check payable to Boz, who indorses the back, gives it to Credit Union, and receives cash. The transfer of the check from Boz to Credit Union is

a negotiation

Promises that are legally binding include

a promise to pay for items ordered online

Business Rents LLC and Cartage Trucking Inc. enter into a contract for a lease of ten hydraulic lifts. Under the perfect tender rule, Business Rents must ship or tender lifts to Cartage that, with regard to the contract specifications, conform

in every way

Metro Holdings Inc. contracts to sell a commercial parking garage to New Property LLC. The contract provides that if Metro does not close the deal by a certain date, it must pay the buyer one-half of the value of the property. This provision is not enforceable if it is

designed to penalize Metro

Chuck signs Dolly's name, without her authorization, to the back of her paycheck, which was issued by Eastside Market. This is

forgery

Gillis writes a check to Harley as payment for a game player but soon discovers it is broken. He goes to the drawee bank and orally authorizes Ilene, a bank officer, to stop payment on the check. This order is valid for

fourteen days

The members of Citizens Aware believe that a recently enacted federal law is unconstitutional. They write and sign a petition to the government to repeal the law, refuse to obey it, and stop others from complying with it. Under the First Amendment, these individuals have a right to

petition the government.

To create an enforceable security interest between Mortgage Bank and Nations Property Company with a written security agreement, the agreement must be signed by

the debtor

When processing a check, Platinum Bank encodes information, such as the amount of the check, on the item. Platinum thereby warrants to any subsequent bank or payor

the encoded information is correct

Retail Company is located in Seattle, Washington, where the city and the state have minimum wage laws. Retail pays its starting employees the legal minimum rate, which, among the governing laws, is

the highest minimum wage

Compliance with the law is not always sufficient to determine "right" behavior because

the law does not codify all ethical requirements.

Hale, research manager for Investor Fund, Inc., adheres to utilitarian ethics in making business and ethical decisions that involve the actions of the firm. According to this standard, an action is morally correct when it produces the greatest good for

the most people

Big Dig LLC makes an offer to perform an excavation and related tasks for Commercial Development Corporation, but due to a substantial mathematical mistake, significantly underprices the work. Commercial accepts the offer. Data Big's best defense against enforcement of the contract is that Commercial knew

the price was below the prices of comparable services

Farmers Pantry Products Inc. and Market Grocers LLC dispute a term in their contract. Because the parties have a long-standing business relationship that they would like to continue, they could settle their dispute through mediation because

the process is not as adversarial as litigation.

Riverside Mill and Standard Contractors enter into a contract for a sale of lumber. The mill knows the purpose for which the buyer will use the goods. Under the UCC, an implied warranty of fitness of a particular purpose arises if

the seller is a merchant who deals in goods of the kind sold

On a challenge to a provision in a state constitution that conflicts with a provision in the U.S. Constitution

the state provision will not be enforced.

Under the U.S. Constitution, the federal government has the power to regulate commercial activities among the states. This grant implies that the regulation of such activities is not within the authority of

the states

A contract is an implied contract if the conduct of the parties creates and defines some of the terms.

True

A landlord is expected to use reasonable care to ensure that his or her tenants are not harmed in common areas.

True

A party may have the capacity to enter into a valid contract and the right to avoid liability under it.

True

A person who transfers an instrument for consideration warrants to all subsequent transferees and holders who take the instrument in good faith that all signatures on the item are authentic and authorized

True

Erma enters into a contract to buy a tract of lakefront property from Forest Acres to build and sell a residential development. Forest Acres fails to close the sale. Erma's remedy is most likely

specific performance

Sal is mentally incompetent but has not been adjudged by a court to be incompetent. Sal enters into a contract with Tony for the cleaning and maintenance of Uptown Office building. Most likely, the contract is

voidable if Sal did not comprehend the consequences