Business Law Quiz 3, Business Law Final Exam

Eviction

-A landlord's act of depriving a tenant of possession of the leased premises. -In NC it is called "Summary Ejectment" -No self help - meaning judicial process must be followed if eviction occurs

What are the types of bailments?

-Bailment for the sole benefit of the bailer -Bailment for the sole benefit of the bailee -Mutual benefit bailment

Are there any restrictions on naming your business?

-Check with the Secretary of State's office about the rules and restrictions for business names -Conduct a corporate name search and a trademark search

What are the rules for finders of property?

-Finder of lost property can claim title to the property against the whole world - except the true owner. -Finder of abandoned property can claim title to the property against the whole world - including the true owner.

What is the duty to warn of defects?

-If the bailor receives a benefit from the bailment, then he has a duty to inform the bailee of known defects and to make a reasonable inspection for other defects. -If the bailor does not receive any benefit, however, then his only duty is to inform the bailee of known defects.

Life insurance policy requirements

-Insurable interest -Consent

Consequences of material misrepresentations

-Misrepresentation is basically an error(s) that the policyholder provided to the insurance company at the time of the policy being issued. -the insurance company will void the contract and return the premium, leaving the driver or homeowner uninsured from the time the policy was applied for (which could theoretically be up to any number of years). -when the insurance company determines material misrepresentation and voids the contract, the insurance company may decide that insurance fraud has occurred if the investigators believe the misrepresentation was intentional. In this case, the investigators may also turn over the case to legal authorities and prosecution may occur.

What are the different types of tenancies?

-Tenancy for years (a set period of time) -Tenancy from year to year (a periodic tenancy, revolving) -Tenancy at will (as long as both parties want it to last) -Tenancy at sufferance (has no lease left, tenant is just still living there, and landlord may sue)

What is the function of shareholders?

-They make a financial investment in the corporation, which entitles those with voting shares to elect the directors. -Shareholders do not normally have any rights to be involved directly in company management. Their connection to company management is typically via the Board of Directors as described above.

What is piercing the corporate veil? What do you need to show to pierce the corporate veil?

-This is when the Court disregards corporate entity and holds shareholders personally liable for the corporate debts and obligations. Factors are : -Tricking someone into dealing with the corporation instead of the individual. -Corporation is too thinly capitalized. -Statutory corporate formalities not followed. -Personal and corporate interests commingled such that corp has no separate identity.

Tenant's Duties

-To pay rent -To protect and preserve the premises

Landlord's Duties

-To pay taxes and assessments -To protect the tenant from concealed defects -To mitigate damages upon abandonment by the tenant

Trade Fixtures VS Fixtures

-Trade Fixtures - Used for business and go with you -Fixtures - remain on the property

What is a bailment?

A bailment is formed by the delivery of personal property, without transfer of title, by one person, called a bailor, to another, called a bailee. -3 elements: 1. Personal Property 2. Delivery of possession without title 3. Agreement that the property will be returned to the bailor or otherwise disposed of according to the owner's directions.

Alien Corporation

A company organized or incorporated under the laws of any foreign nation, province, or territory.

Foreign Corporation

A company within the state in which it is NOT chartered and in which its home office is NOT located.

Domestic Corporation

A company within the state in which it is chartered and in which its home office is located.

What is a self-help eviction and what are the rules?

A self-help eviction occurs when a landlord retakes possession of a property without using the eviction process. The use of self-help may amount to landlord harassment. Nearly every state prohibits a landlord from using self-help to evict a tenant.

Adverse possession

A way of obtaining title to land without delivery of a deed and without the consent of - or payment to- the true owner. Requirements: -Actual and exclusive -Open and notorious -Continuous -Hostile

How many members and/or managers must an LLC have?

An LLC can have 1 or more members, and is not required to have managers.

What is the function of a registered agent?

An individual or business entity responsible for receiving important legal documents on behalf of your business.

Easement by prescription

Arises when one person exercises an easement on another person's land without the landowners consent.

What is the key moment of formation of a corporation?

File articles of incorporation with Secretary of State

Where should you check to do your due diligence regarding naming your business?

File articles of incorporation with the Secretary of State

What are the rules for security deposits

If the landlord does not return the security deposit, they must itemize any damage with the balance of the security deposit on later than 30 days after rental termination.

Insurable interest

Interest that exists when a person benefits from the preservation of the health or life of the insured or the property to be insured

What is the advantage of a corporation?

Limited liability. The shareholders of a corporation are only liable up to the amount of their investments. The corporate entity shields them from any further liability, so their personal assets are protected.

What is the difference between a limited partner and general partner?

Limited partnerships will still have at least one general partner to man the day-to-day operations of the business. A general partner may invest money into the company. However, a general partner may also be personally liable for the debts of the company, while the limited partner is not

What is the difference between lost and abandoned property?

Lost property - Finder of lost property can claim title to the property against the whole world - except the true owner Abandoned Property: Finder of abandoned property can claim title to the property against the whole world, including the true owner.

Can the landlord/tenant statutes provisions be waived?

No, if you have a provision in the lease that says something different than the statute then the provision will be void as against public policy.

Can landlords retaliate for complaints?

No, the landlord is obligated to repair what is needed.

What is the function of officers?

Officers are responsible for the management and day-to-day operations of the corporation.

How are officers selected?

Officers are usually appointed by the corporation's board of directors

What is the timeline for filing a complaint in summary ejectment?

Once the landlord makes a demand for past-due rent from the tenant, the landlord must wait 10 days before filing an evicion action and must be a clear demand.

What is the difference between real and personal property?

Real property is the land or anything permanently attached to it. Personal property is NOT on land or anything permanently attached to it.

What are the standards of case for the different types of bailments?

The bailor's duty to revel defects: -Sole Benefit of Bailee: Notify of all known defects -Mutual Benefit: Notify of all known defects and any hidden defects that bailor knows or could have discovered with reasonable diligence and proper inspection

What is the function of directors?

The board of directors are in charge of the management of the company's business; they make the strategic and operational decisions of the company and are responsible for ensuring that the company meets its statutory obligations.

If a partnership does not have a partnership agreement, what are the default rules for sharing profits and losses?

This means that the partners share equally in profits or losses

In a partnership, how are profits and losses split?

When forming a partnership, the business owners have the option of creating an agreement that dictates how profits or losses pass through to members of the partnership. Absent an agreement, the partners will share profits and losses equally. If an agreement exists, partners divide profits based on the terms specified.

Interpreting the insurance contract - policy ambiguity

When there is an ambiguity in the policy, the provision generally is interpreted against the insurance company

Who is a bailee?

person who has lawful possession of another person's property

How do you form a corporation? What is the key moment of formation?

1. Select state of incorporation 2. Secure corporate name 3. Prepare articles of incorporation 4. File articles of incorporation with Secretary of State(KEY MOMENT OF FORMATION!!) 5. Hold first organization meeting

What are the rules for naming an LP, LLP, LLC, or a corporation?

The name can not be substantially similar to that of another corporations. You can check on the site online. Limited Liability organizations are always filed with the secretary of state.

Who is a bailer?

The person who is delivering the personal property without transfer of title

How is a corporation taxed?

The profit of a corporation is taxed to the corporation when earned, and then is taxed to the shareholders when distributed as dividends. This creates a double taxation.

Easement

The right of a person to make limited use of another person's real property wihtout taking anything from the property.

Who owns a corporation?

The shareholders

How are directors selected?

The shareholders elect the Board of Directors.