Business Law EXAM 1 Review (ch. 1, 3, 4, 7-9)

Eliza is a state court judge. Flora appears in a case in Eliza's court, claiming that Glover breached a contract. Which of the following actions may Eliza take? a. Award damages or issues a decree of specific performance b. Imprison Glover, but not Flora c. Imprison Flora, but not Glover d. Order the parties to pay Eliza to render a favorable ruling

Award damages or issues a decree of specific performance

A unilateral mistake always gives the mistaken party a right to relief from the contract

False

Any judgement is enforceable

False

Common law is the same as statutory law

False

Compensatory damages compensate the injured party for injuries sustained due to loss of the contract and also punish the party that breached the contract.

False

It is illegal for two parties to mutually agree to rescind a valid contract.

False

Normally, when a nonbreaching party has been damaged by a breach of contract, he or she does not have a duty to mitigate those damages.

False

States decisis is a doctrine obligating judges to help persons who have failed to protect their own rights

False

To avoid liability for negligence, a business owner must protect its patrons against all risks.

False

To commit an intentional tort, one person must intend to harm a certain person.

False

Under the Statute of frauds, oral contracts are void

False

Uniform laws apply in all states, including those in which the laws have not been adopted.

False

A contract is valid only if both of the parties entering into it have the capacity to do so.

True

A court's review of an arbitrator's award may be restricted

True

A liquidated damages provision specifies that a certain amount to be paid in the event of a future default or breach of contract

True

A mistake in value will rarely enable a party to a contract to avoid the contract

True

A prenuptial agreement must be in writing to be enforceable

True

Consideration is the value given in return for a promise.

True

Harm must be foreseeable to be considered the proximate cause of an injury in negligence.

True

If an offeror does not expressly authorize a certain mode of acceptance, then acceptance may be made by any reasonable means.

True

In a contract for a sale of goods, the usual measure of compensatory damages is the difference between the contract price and the market price.

True

In some states, misrepresentation of age by a minor is enough to prohibit disaffirmance

True

Interrogatories are written questions for which written answers are prepared and signed under oath

True

Objective impossibility discharges a contract.

True

Preemption occurs when Congress chooses to act exclusively in a concurrent area and a valid federal statue or regulation takes precedence over a conflicting state or local law.

True

Statutes are laws enacted by Congress and state legislatures and compromise one of the sources of American law

True

The mirror image rule requires an acceptance to adhere exactly to an offer to create a contract.

True

Through tort law, society compensates those who suffer injuries as a result of others' wrongful conduct.

True

Wrongfully taking personal property without the owner's permission is conversion.

True

Lora files a suit in Michigan against Ned over the ownership of a boat docked in a Michigan harbor. Lora and Ned are residents of Ohio. Ned could ask for a change of venue on the ground that Ohio a. has a sufficient stake in the matter. b. has jurisdiction. c. has sufficient minimum contacts with the parties. d. is a more convenient location to hold the trial.

a more convenient location to hold the trial

Chelsea is a state court judge. Like judges in most state courts, in a particular case, she may grant a. a remedy at law only b. a remedy in equity or a remedy at law, but not both c. a remedy in equity and remedy at law d. a remedy in equity only

a remedy in equity and remedy at law

Tristan promises to paint Katy's house in exchange for Lila's promise to plant trees on Tristan's property. This is a. a delegation b. an assignment c. a third party beneficiary contract d. none of the choices

a third party beneficiary contract

Livewire Company and McCoy's Candy, Inc., sign a document that states Livewire agrees to design a Web page for McCoy's, which agrees to pay for the service. This is a. an express contract b. no contract c. an implied contract d. a quasi contract

an express contract

App Developers, Inc. (ADI), enters into a contract with Carmen, the chief executive officer of SalesCorp, to create an app for the firm. To fulfill the contract, ADI hires Max and ten other student interns. With respect to the contract, Max is a. an intended beneficiary b. an incidental beneficiary c. a delegatee d. an assignee

an incidental beneficiary

Carol files a suit against Andy in a state trial court and loses. Carol a. cannot take her case any higher in the court system b. can insist that the United States Supreme court hear her case c. can plead her case before an appellate court d. can plead her case before a small claims court

can plead her case before an appellate court

Richard is an adult. He enters into a contract to sell sixteen-year-old Jane his car for $3,000. The next day Richard receives an offer of $4,000 for his car from twenty-year-old Bill. Richard a. cannot disaffirm his contract with Jane because he is an adult b. can disaffirm his contract with Jane because Bill is an adult and contracts with adults take precedence over contracts with minors c. cannot disaffirm his contract with Jane because she is a minor d. can disaffirm his contract with Jane because the contract has not been ratified

cannot disaffirm his contract with Jane because he is an adult

Bella owns a farm in Colorado. Doyle drives his sport utility vehicle off a highway and onto Bella's land. Doyle commits trespass if he a. does not have Bella's permission to drive on the property. b. drives onto the property for recreational purposes. c. harms the property in a material way. d. harms the property in any way.

does not have Bella's permission to drive on the property

Colleen is intoxicated, but still mentally capable of understanding the consequences of her actions when she signs a contract to sell the rights to her latest phone app design to Addie. The contract is a. enforceable only if Colleen does not attempt to disaffirm it b. enforceable even if Colleen attempts to disaffirm it c. unenforceable if Addie attempts to disaffirm it d. enforceable only if Addie does not attempt to disaffirm it

enforceable even if Colleen attempts to disaffirm it

The state of Illinois enacts a usury statute. The purpose is to a. establish a maximum rate of interest that may be charged for loans b. establish a minimum rate of interest that may be charged for loans c. prevent the misuse of money advanced as loans d. prevent the misuse of money paid back on loans

establish a maximum rate of interest that may be charged for loans

Drummond wants to make a federal case out of his dispute with Elena. Federal cases originate in a. federal court of appeals b. federal district courts c. state trial courts d. the United States Supreme Court

federal district courts

Ruthie, a minor, charges the cost of an expensive leather jacket at a Girl's Trend store. Two nights later, Ruthie loses the jacket at Minors Only Club. She disaffirms the jacket's purchase. Ruthie owes Girl's Trend the reasonable value of the jacket a. if it is deemed a "necessary" b. if it is deemed unnecessary c. under any circumstances d. under no circumstances

if it is deemed a "necessary"

Tami's Tasty Tacos, a fast food outfit, files a suit against the state of Texas, claiming that a Texas state law violates the commerce clause. The court will agree if the statute imposes a substantial burden on a. a local government. b. interstate commerce. c. noneconomic activity. d. the state.

interstate commerce

A Montana state court can exercise jurisdiction over Endurance Insurance Corporation, an out-of-state defendant, but the defendant must have a. minimum contacts with the state b. maximum contacts with the state c. legitimate contacts with the state d. legal contacts with the state

minimum contacts with the state

Obie accuses Portia, a broker with QT Financial Services, of fraudulently inducing him to invest in Risky Development Company, whose stock price declines in value. The reliance that gives rise to liability for fraud requires a. a subjective statement b. misrepresentation of a fact knowing that it is false c. puffery d. seller's talk

misrepresentation of a fact knowing that it is false

Juan and Isidro enter into a contract to buy, restore, and reopen the Coastal Park Carousel. Before either party begins to perform, they agree to cancel their deal. This is - a. substantial performance b. mutual rescission c. accord and satisfaction d. novation

mutual rescission

Jolie signs a contract with Keaton, an unlicensed physician, to perform a medical procedure. This contract is enforceable by a. Jolie b. Jolie's medical insurance company c. Keaton d. no one

no one

Liz trespasses on Mega Corporation's property. Through the use of reasonable force, Mega's security guard Ned detains Liz until the police arrive. Mega is liable for a. assault b. battery c. false imprisonment d. none of the choices

none of the choices

May tries to start her new car with no success. She yells that she will sell the car to anyone for $10. Nick, a passerby who owns Nick's Pre-owned Autos, hands May $10. This is a. a valid acceptance because May is seriously frustrated b. a valid acceptance because Nick is a car dealer c. not a valid acceptance because May does not seriously intend to sell d. not a valid acceptance because Nick is a car dealer

not a valid acceptance because May does not seriously intend to sell

Pastry Dough, Inc., sends its catalogue to Octavio and includes a "personalized" letter inviting him to buy any item in it at the advertised price. This is a. an offer because of the "personalized" letter b. an offer because there is no room for price negotiation c. an offer only if Octavio previously bought items from Pastry Dough d. not an offer

not an offer

Jim is an appliance salesperson. To make a sale, he asserts that a certain model of a Kitchen Helper refrigerator is the "best one ever made." This is a. fraud if the statement is the truth b. fraud if Jim believes that this statement is not true c. fraud if Jim is stating his opinion, not the facts d. not fraud

not fraud (puffery)

Dylan enters into a contract to manage the operations of Cash's accounting office for one year, renewable for subsequent one-year terms. If this contract is discharged like most contracts, it will be a. breached b. rescinded c. altered d. performed

performed

Pat, a world famous musician and composer, agrees to give ten piano lessons to Quinn in exchange for $1,000. Pat's attempt to delegate his contract to Ruth, an inexperienced pianist, will probably be a. permitted because contracts may be freely delegated b. permitted because the contract is concerned with music lessons c. prohibited because contracts may not be freely delegated d. prohibited because Pat and Ruth have very different skill levels

prohibited because Pat and Ruth have very different skill levels

Jim tells Dana that he will take her out to lunch on Thursday. Jim has made Dana a a. prediction b. promise c. bilateral contract d. void contract

promise

Reusable Energy Corporation regularly expresses opinions on political issues. Under the First Amendment, corporate political speech is a. discouraged b. forbidden c. protected d. required

protected

Tyler, a citizen of West Virginia, files a suit in a West Virginia state court against Louisville Sales Corporation, a Kentucky state company that does business in West Virginia. The court has original jurisdiction, which means that a. the case is being heard for the first time b. the court has a unique method of deciding whether to hear a case c. the court has unusual procedural rules d. the subject matter of the suit is interesting and new

the case is being heard for the first time

Phil agrees to work for Vacation Resorts, Inc., as a chef. In determining whether a contract has been formed, an element of prime importance is a. the parties' intent b. Phil's rate of pay c. Phil's education d. the terms of Phil's employment

the parties' intent

Jane enters into a contract with Jill to provide 100 roses for a dinner party. Jane fails to deliver the roses. Jill initiates a suit against Jane, asking the court to order Jane to deliver the roses. Jill is a. the plaintiff b. the defendant c. the binding authority d. the persuasive authority

the plaintiff

Mary is angry with Julia so she waits outside Julia's house and hits Julia with a baseball bat as Julia leaves the house. When Julia sues Mary for battery, Mary will be considered a a. victim b. tortfeasor c. plantiff d. unreasonable person

tortfeasor