BLAW 2nd MIDTERM REVIEW QUESTIONS
What is "due diligence" with respect to liability?
"Due diligence" is a defense to personal liability, which can be used if the officer or director can prove that he or she did all that was reasonable in the circumstances to ensure that the corporation acted responsibly. This defense of due diligence can be supported by evidence of corporate policies and procedures in place to prevent such events.
Unlike general partnerships, limited partnerships and limited liability partnerships are legal entities separate from the partners.
False
Agents may have more than one principal.
True
All partners are agents of their partnership.
True
All the ordinary rules of contract law apply, except where they are modified by the BPCPA
True
A consumer inspects a leather couch and agrees to buy it from a business. The business immediately moves the leather couch to the loading docks for shipping, the title passes to the consumer a. as soon as the contract is concluded. b. whenever the contract obliges the consumer to pay. c. whenever the contract requires the couch be delivered. d. as soon as the buyer receives notice that the couch has shipped.
A
A limited partner does not risk opening herself up to liability as a general partner when a. acting as an agent in circumstances described in the partnership agreement. b. overstepping the rules applicable to her role in the firm. c. taking on a managerial role with respect to the partnership's business. d. being involved in the partnership's decision making.
A
If a business systematically offers different pricing terms and conditions to competing customers on sales of equal volume, under the Competition Act it may be found to be engaging in a. price discrimination. b. predatory pricing. c. price maintenance. d. exclusive dealing.
A
The owners of a corporation are a. the shareholders. b. the incorporators. c. the employees. d. the stakeholders.
A
Which of the following business structures would be considered the least expensive or complex to set up and run? a. general partnership b. limited partnership c. limited liability partnership d. private corporation
A
What is a "franchise"?
A franchise is a right to operate a business using the name, products, business methods, and advertising of another business.
Briefly describe the legal characteristics of a general partnership
A general partnership is not an independent legal entity. It cannot, therefore, enter legally binding contracts or protect its owners (the partners) from legal liabilities for injuries (either physical or financial) caused by the firm. As a result, the individual partners in a general partnership are jointly and severally liable for the actions of the firm. This means that they divide liability equally, and are also each entirely liable for the firm's actions. If you decide to run your business as a general partnership, you may be liable for the conduct of each of your partners. The law views you as representing — or as acting as an agent for — both the firm and each of your partners individually. As a result, if one of your partners makes a serious error that harms a client, you and every other partner in your firm could be legally responsible for compensating the client for all losses that result from the error. As in the case of a sole proprietorship, each partner may be liable to the full extent of her personal assets for all debts and other obligations of the partnership. This means that you could lose your home, your investments, and all your savings if any of the partners in your farm makes a serious error.
Briefly describe the legal characteristics of a general partnership.
A general partnership is not an independent legal entity. It cannot, therefore, enter legally binding contracts or protect its owners (the partners) from legal liabilities for injuries (either physical or financial) caused by the firm. As a result, the individual partners in a general partnership are jointly and severally liable for the actions of the firm. This means that they divide liability equally, and are also each entirely liable for the firm's actions. If you decide to run your business as a general partnership, you may be liable for the conduct of each of your partners. The law views you as representing — or as acting as an agent for — both the firm and each of your partners individually. As a result, if one of your partners makes a serious error that harms a client, you and every other partner in your firm could be legally responsible for compensating the client for all losses that result from the error. As in the case of a sole proprietorship, each partner may be liable to the full extent of her personal assets for all debts and other obligations of the partnership. This means that you could lose your home, your investments, and all your savings if any of the partners in your farm makes a serious error.
What are the consequences if a limited partner assumes management responsibilities?
A limited partner who assumes management responsibilities will lose the limited liability status and become a general partner — with full risk of liability.
Briefly describe the legal characteristics of a sole proprietorship.
A sole proprietorship has no legal existence apart from its owner. It therefore cannot sue another individual or business, nor can it be sued on its own behalf. The owner is the legal entity that must sue on behalf of the business, and that will be sued for the misdeeds of the business. A sole proprietorship cannot enter contracts; rather, its owner enters contracts on its behalf and is responsible for fulfilling any contractual obligations related to the business. It does not file its own income tax return; instead, its owner claims income derived from the business and deducts business expenses on her personal tax return.
An advantage of a general partnership over other types of partnerships is a. general liability of the partners. b. flexibility and simplicity. c. protection from liability for the negligence of other partners. d. liability of partners limited to their individual investment in the firm.
B
To emphasize its concern for clarity, the BPCPA codifies the common-law rule that any ambiguous contractual information or provisions drafted by the business are to be interpreted a. in a non-biased way for all parties. b. to the benefit of the consumer. c. to the benefit of the business. d. in favour of the drafter of the agreement.
B
Which of the following is not a condition implied into contracts by the British Columbia BPCPA? a. Any goods sold by description are of reasonable quality, taking into account their price. b. The seller is liable to the buyer for reasonably discoverable defects if the buyer accepts the goods after inspecting them. c. The goods are fit for the purpose for which the buyer purchases them if the seller is aware of the buyer's purpose. d. The goods must be owned or will be owned in the future by the seller, when the seller will be able to transfer ownership in the goods to the buyer.
B
Which of the following is not a way directors and officers of a corporation may be subject to liability? a. Not taking reasonable care to prevent the corporation from polluting contrary to the Environmental Protection Act. b. Being held personally liable for debts of the corporation if it is forced into bankruptcy. c. Not taking reasonable care to ensure that the corporation complies with the Occupational Health and Safety Act. d. Being held jointly and severally liable for wages in certain circumstances if the corporation is insolvent.
B
Which type of partnerships requires a partnership agreement? a. limited Partnership b. limited Liability Partnership c. all types of partnerships requires a partnership agreement. d. all types of partnership may operate without a partnership agreement.
B
A buyer is entitled to the use the goods she has bought without interference from third parties who might claim an interest in them. This refers to which implied warranty under the BPCPA? a. goods free of encumbrances b. fitness for purchase c. quiet possession of goods d. right to purchase
C
Businesses that come together under a joint venture a. must register the name of the joint venture. b. create a separate legal entity for the duration of the project. c. part ways at the end the project with no impact on their individual legal status. d. use a written partnership agreement to define and govern their relationship in the project.
C
If a business person makes an agreement with a consumer, and the business person knows or ought to know that the consumer is not reasonably able to protect their interests because of disability, the business person has made a. a deceptive representation. b. a misleading representation. c. an unconscionable representation. d. a false representation.
C
Three lawyers create a partnership. Two of the lawyers are liable only for the general debts of the firm and not for the professional negligence of the other partners. This is what kind of partnership? a. general Partnership b. limited Partnership c. limited Liability Partnership d. general Liability Partnership
C
Under the BPCPA, if the seller delivers a quantity of goods that is materially less than the buyer agreed to purchase, which of the following is not an option? a. The buyer may reject the whole shipment. b. The buyer may complete the transaction at the contract rate. c. The buyer may apply for specific performance of the contract. d. all of the above
C
Which of the following is a criminal offence under the Competition Act? a. using loss leaders b. telemarketing c. bid-rigging d. operating a multi-level marketing plan
C
Which of the following is true regarding mergers under the Competition Act? a. It is an offence for a business to become dominant in the marketplace. b. Mergers, as a feature of a free market, are never reviewable. c. A merger may be a reviewable practice if it is likely to lessen competition substantially. d. It is an offence if a combined enterprise is able to control half or more of the market.
C
What is the meaning and significance of "caveat emptor"?
Caveat emptor means buyer beware. It is a common law principle that provided that buyers and sellers were expected to conduct whatever investigations were appropriate and to include whatever contractual terms necessary to protect their interests. So, if a product turned out to be shoddy, the buyer would suffer the burden.
A franchise agreement may be made between a. two sole proprietorships. b. a sole proprietorship and a corporation. c. a sole proprietorship and a partnership. d. all of the above
D
A limited liability partnership may be attractive to lawyers and accountants because a. they are not legally permitted to form corporations to practise their profession. b. it avoids the disadvantage of unlimited liability for all partners. c. partners are not liable for negligent acts or omissions of other partners in the firm. d. all of the above
D
According to the federal act and provincial law, a. electronic documents and signatures are the equivalent of written contracts signed by hand. b. any contract that can entered into writing on paper can be entered into electronically. c. electronic documents and signature equivalents that are protected by password or encryption are recognized. d. all of the above
D
An agency relationship a. may be implied from the circumstances. b. may exist from past behaviour. c. is established with a formal agency agreement. d. all of the above
D
At law, the timing for the formation of contract entered into electronically is, a. an offer exists as soon as the party making the offer hits "send." b. acceptance occurs when the acceptance message is received. c. acceptance occurs whether or not the acceptance message is opened and read. d. all of the above
D
Before shares in a public corporation are offered for sale to the public, the incorporators or the corporation must prepare and distribute a document called a. a shareholders' agreement. b. a share certificate. c. the articles of incorporation. d. a prospectus.
D
In a general partnership, a. at least one general partner must be fully liable for the debts of the firm and any negligence of the other partners. b. liability of the partners is limited to their capital investment. c. some of a the partners may be liable for only the debts of the firm, and not for any negligence of the other partners. d. all partners are jointly and severally liable for each others' debts and negligence.
D
Which of the following is an activity prohibited by the Food and Drugs Act? a. false labelling or advertising b. misleading drug claims c. importation between provinces of food that does not meet prescribed standards d. all of the above
D
Which of the following persons of a corporation would owe a fiduciary duty? a. president b. chief operations officer c. director d. all of the above
D
Without its owner, a sole proprietorship may a. enter into contracts. b. may sue other individuals or businesses. c. file an income tax return. d. none of the above
D
You, the owner of a business, tell your sales agent that he is not authorized to offer discounts to customers. Your agent negotiates a contract with a customer that involves a discount. a. All contracts negotiated by your agent are enforceable, regardless whether they have real authority. b. The customer cannot assume that your agent has real authority. c. You cannot be bound to the contract because your agent has no real authority. d. The contract may be enforceable if the customer is allowed to assume that your agent has real authority.
D
What is directors' and officers' liability and why is it significant?
Every director and officer of a corporation must use reasonable care, diligence, and skill in the course of carrying out their duties, or face liability for breach of fiduciary duty of care. Generally, it is not enough for a director or officer to say that she tried her best; she must be seen to act as responsibly as a reasonable officer or director would act. Directors and officers also have obligations, and are subject to liability, under legislation intended to protect the public — such as environmental protection statutes and workplace statutes that protect employees. This liability can be substantial, such as hundreds of thousands of dollars in fines, and even prison terms.
A "prospectus" is a document that usually must be filed with the articles of incorporation of private corporations.
False
A franchise is a chain of stores all owned by the same corporation, using the same name, and selling the same products.
False
A limited liability partnership can be used as a method of raising capital from a silent investor.
False
A partnership agreement is required to give a partnership the status of a separate legal entity.
False
A shareholder, or group of shareholders, "own" the corporation if they hold a majority of the corporation's shares.
False
A written employment contract is called a "collective agreement."
False
An intention to discriminate is an essential element of the prohibited act under human rights legislation.
False
Consumer protection law is much narrower in scope than sale of goods law.
False
Future goods are goods that are not yet set aside and identifiable as the subject of the contract at the time the contract is made.
False
If an agent is made aware of the scope of his or her authority, the principal is unlikely to be found liable for contracts made with third parties outside the scope of authority.
False
Partnerships are legally independent from the people who compose them.
False
Shareholders owe a fiduciary duty that requires that they put the corporation's interests before their own personal financial interests.
False
The name of a sole proprietorship must be registered with the Provincial Government.
False
The oppression remedy allows partners to apply to the court to enforce the terms of the partnership agreement.
False
The physical transfer of property is deemed transfer of ownership rights.
False
What is the crucial difference between a general partnership and limited liability partnership?
In a limited liability partnership a partner is not liable for the professional negligence of the other partners.
What is joint and several liability?
Joint and several liability is financial responsibility requiring all parties to contribute equally but also making each party responsible for the entire amount owed.
What is the most important advantage of using a corporation to operate a business?
The most important advantage is the protection it provides to shareholders, employees, officers, and directors from personal liability for the debts and obligations of the business.
What is the purpose of a prospectus?
The purpose of a prospectus is to ensure that any member of the public who is contemplating spending his money to purchase shares in the corporation has sufficient reliable information about the corporation, its financial health, and its future prospects to make the decision wisely.
What is the difference between private corporations and public corporations?
The shares of private corporations are held by a small group of people who usually know each other, such as family members or business associates. Public corporations sell their shares to the public at large, and are subject to a much greater degree of government regulation as a result.
Why is it important to determine when title to goods passes from a seller to a buyer?
Transfer of title determines transfer of risk and responsibility for loss.
A cooling-off period is a period during which consumers can cancel their contracts without providing businesses with any justification for doing so.
True
A limited partnership has one or more general partners and one or more limited partners.
True
A seller's breach of an implied condition in a contract for the sale of goods allows the buyer to reject the goods and ignore all further contractual obligations.
True
A share certificate is a document that represents the ownership of shares in the corporation.
True
A sole proprietorship is created as soon as someone opens a business that interacts with the public.
True
A unanimous shareholders' agreement allows a private corporation to enjoy the flexibility that a partnership offers, while still taking advantage of the benefits of incorporation.
True
About 90% of employees in Canada are governed by provincial employment legislation.
True
An agent acts on a principal's behalf in an interaction with a third party and affects the legal position or interests of the principal.
True
By signing a personal guarantee, a shareholder may undermine the protection against liability that incorporation offers.
True
Clicking an icon may bind you to a legally enforceable contract.
True
Damages are the only remedy for breach of warranty, regardless of whether the warranty is express or implied by statute.
True
Directors are elected by shareholders and must report to shareholders at regular shareholders' meetings.
True
If a seller fails to deliver goods, the buyer can buy the goods elsewhere and sue the seller for the difference between the contract price and the price that the buyer actually paid.
True
If the people who created a corporation die, the corporation continues to exist.
True
In BC, the Business Practices and Consumer Protection Act is the principal statute that governs commercial sales transactions.
True
In a sole proprietorship there is no legal separation between the person and the business.
True
Issues of concern with respect to joint ventures include how to share profits or losses and how to deal with liabilities.
True
Laws governing the workplace rights of employers and employees are found both in statute and in common law.
True
Price estimates for repairing vehicles and other goods must be in writing and contain specifics about the repairer, the vehicle to be repaired, and the parts and services required, and it must provide an itemized list of costs.
True
The Hazardous Products Act provides at a variety of categories of "restricted" products that must be labelled in a specific manner or meet certain standards to be legally sold in Canada.
True
The Personal Information Protection and Privacy Act applies to businesses that collect, use, or disclose personal information in the course of commercial activities.
True
The partners in a partnership may be individuals, corporations, sole proprietorships, or other partnerships.
True
The penalties for failure to comply with the Food and Drugs Act are particularly harsh with respect to food, in which case the maximum fine is $250,000 and the maximum jail term is three years.
True
When repairing vehicles and other goods, a business is obliged to provide a written estimate unless the consumer declines the offer, or authorizes a maximum payment that is not exceeded.
True
Workplace law encompasses human rights law, contract law, employment standards law, health and safety law, equity law, privacy law, labour relations law, and tort law.
True
Describe three contract issues relevant to those engaged in e-commerce.
a. Authenticity of documents and electronic signatures: PIPEDA and provincial electronic commerce statutes such as Ontario's ECA recognize electronic documents and "signature equivalents" that are protected by password or encryption. Any contract that can be entered into on paper can be entered into electronically. b. Place for dispute resolution: Some Internet contracts have tried to create predictability about the place where disputes will be resolved by specifying the place for resolution in the contract. c. Applicable law for dispute resolution: Statutes and regulations differ in different jurisdictions. A governing law clause may specify which law is to apply. d. Timing of formation of contract: Statutes such as Ontario's ECA have adopted the rule that unless the parties specify otherwise, an offer exists as soon as the party making the offer hits the "send" button, and acceptance occurs when the acceptance message is received (whether or not it is opened and read). Clicking an icon is also effective offer and acceptance. e. Protection of privacy: Privacy legislation
Identify and describe an advantage and disadvantages of running a business as a sole proprietorship.
a. Cost and complexity: Simplicity is the key advantage of carrying on business as a sole proprietorship. You may require business and other licences required by the municipality in which you operate, but you have no other requirements to fulfill. You can decide to open a business, and be up and running almost immediately as a sole proprietor. You can make important decisions about your business easily — without changing documentation, obtaining approvals, or consulting others. b. Taxation implications: The tax department treats a sole proprietorship as a source of income (or as a business loss) for its owner. Any profit (income minus legitimate expenses) earned by the business is added to the total income of the owner for income tax purposes. On the other hand, losses incurred by the business can be set off against the owner's income from other sources in order to reduce tax. In other words, the tax department simply treats income from your sole proprietorship as another source of your personal income, alongside income from employment, property, or investments. Like other types of business, a sole proprietorship allows you — as owner — to employ people, including members of your family. This can work as an income-splitting arrangement, giving you an opportunity to save tax by diverting income from your pocket to that of a family member who pays tax at a lower rate than you do. In this manner, your business income stays in your family, and may be subject to lower tax rates. c. Liability issues: The main disadvantage of choosing to operate a business as a sole proprietorship is the legal liability of the owner. Because the owner and the business are one in the eyes of the law, the owner is legally liable for any injury (whether physical or financial) that the business may cause to others. This means that the owner is personally subject to unlimited liability. Because your sole proprietorship is unable to enter contracts, you— as owner— become responsible for all contractual obligations of your business, and you become personally liable for any breaches of contract. d. Considerations concerning expansion: Only one person can own a sole proprietorship. If the business expands significantly — or if it requires an infusion of money to continue to operate or to expand — the owner may wish to bring other individuals in as co-owners. In order to do this, it is necessary to convert the business to a structure other than a sole proprietorship: either a partnership or a corporation.
Identify and describe a major advantage and disadvantage of running a business as a general partnership versus a limited liability partnership.
a. Cost and complexity: The general partnership has the advantage of simplicity when smaller groups of people choose to work together. A general partnership is easy to set up and easy to run. As long as it remains small, its operations can be flexible. The limited partnership is a more complex organization than the general partnership, and it requires more documentation. For example, the Limited Partnerships Act in Ontario requires that a current record of the limited partners be kept on the premises, and made available for inspection by the public. This record includes names and contact information of all limited partners, and the amount of money or value of property contributed to the partnership by each limited partner. b. Tax implications: Like the sole proprietorship, any kind of partnership allows business profits to flow into the personal income of its owners — the partners — for the purpose of income tax. The firm keeps accounts of its income and expenses in order to calculate its annual profit (or loss). The profit (or loss) is then apportioned to each partner either equally, if there is no provision to the contrary in the partnership agreement, or unequally in accordance with the terms of the agreement. Each partner then includes her share of the firm's profits as business income in her own personal tax return. The tax implications for a limited partnership are substantially the same as for a general partnership. The partnership's financial information is combined with the partners' personal finances to calculate taxes. c. Liability issues: The biggest disadvantage of the general partnership is general liability. Each partner is personally liable for the debts and obligations of the firm. Each partner's liability is limitless, which means that each partner will have to honour the firm's obligations until all her assets are depleted. This liability exists even if the firm is sued as a result of a single partner's error. In this regard, every partner acts as a sort of insurer for the mistakes of the others. Limitless liability may be less of a concern in a two-person firm, where the partners trust and are able to monitor each other, than in a larger firm. Of course, the larger the firm, the more partners there are to share the cost of mistakes. Where the general partners have unlimited liability for the debts and obligations of the partnership, the liability of the limited partner is usually limited to his investment in the firm. d. Considerations concerning investment: A limited partnership has many of the advantages of a general partnership. It has the additional advantage of allowing people to become involved in the business without assuming the risks or responsibilities of a full general partner. This increases the firm's ability to attract investors, or "silent partners," as an inexpensive and low-risk method of obtaining capital.
List three steps a business can take to avoid committing unfair business practices.
a. Ensure that you and your staff communicate clearly and truthfully with consumers when discussing your products and services. b. Resist the urge to make exaggerated or ambiguous claims, even if consumers appear to be inviting them. c. Take particular care when consumers have language difficulties, mental disabilities, or other impediments that make them particularly vulnerable. d. Allow the prices specified in your contracts to govern your dealings. e. Establish a competent customer relations program to deal with complaints and act as an early warning system for the need to re-educate staff.
List three steps you can take to reduce your risk when entering a partnership.
a. Know the people with whom you enter a partnership. b. Ensure that their personal ethics, professional abilities, and styles of doing business accord with your own. c. Register your partnership's name if it differs from the personal names of the individual partners. d. Carry sufficient insurance to cover whatever liabilities are likely to arise in the course of doing business. e. Create a partnership agreement to ensure that your expectations and those of your partners are in accord.
Describe one of the two implied warranties under the BPCPA.
a. Quiet possession of goods: It is implied that the buyer is entitled to use the goods she has bought without interference from third parties who might claim an interest in them. b. Goods free of encumbrances: It is implied that the goods are sold free of any charge or encumbrance in favour of any third party, not declared or known to the buyer, before or at the time when the contract is made.
Describe three of the major conditions implied into contracts by the BPCPA.
a. Right to sell: It is implied that the seller has the right to sell the goods. They must be owned by the seller such that the seller is able to transfer them. b. Sale by description: It is implied that goods sold by description match the description. c. Fitness for purpose: It is implied that the goods are reasonably fit for the buyer's purpose, provided the seller is aware, or should have been aware of what that purpose is. d. Merchantable quality: It is implied that the goods are of reasonable quality, taking into account the price. e. Sale by sample: It is implied that goods sold by sample match the sample.
List five terms typically found in franchise agreements.
a. The requirement that the franchisee sell only products supplied by the franchiser, in the form in which they are supplied, to the standards set by the franchiser; b. The requirement that the franchisee set up and decorate the business premises exactly as required by the franchiser so that the outlet resembles all other franchises; c. The requirement that the franchisee pay both an initial franchise fee and a periodic royalty to the franchiser, often a percentage of the profit of the franchise; d. The requirement that the franchisee provide audited financial statements to the franchiser on a regular basis; e. The requirement that the franchisee contribute a certain amount of money to the franchiser's advertising fund, which the franchiser then uses to advertise the franchise across its territory (national, provincial, or local); f. The requirement that the franchisee offer specials and discounts only as directed by the franchiser; g. The requirement that the franchisee limit her business to a given territory (when, for example, delivering fast foods); h. The requirement that the franchisee maintain the business premises, the service offered to the public, and the products offered for sale to the standards of the franchiser; i. The requirement that the franchisee establish and maintain sufficient liability insurance on the business and protect the franchiser from any legal liabilities that may arise; j. The requirement that the franchisee participate in any group scheme or organization that the franchiser might set up (for example, the central call center of a pizza business); and k. An acknowledgment that the franchiser may, at any time, revoke the franchise agreement if the franchisee fails to live up to any of her obligations under the agreement.
List four of the rights that shareholders may have.
a. To vote in the election of the directors of the corporation; b. To share in the profits of the corporation in the form of dividends; c. To sell some or all of his shares to others; d. To share in the assets of the corporation if it is wound up; e. To be protected from oppressive acts of the directors or other shareholders; and f. To review the corporation's accounts
Describe three of the five rules that determine when title to goods passes from seller to buyer.
a. Transfer of specific goods in deliverable state: When there is an unconditional sale of specific goods in a deliverable state, title passes to the buyer when the contract is made. It is irrelevant whether the time of payment or the time of delivery is postponed. Specific goods are goods that are identified and agreed upon at the time the contract is made. A deliverable state is a state in which the goods are ready to go — nothing further, such as packaging, needs to be done. b. Goods must be put in deliverable state: When a contract for sale of specific goods requires the seller to do something to the goods to put them in a deliverable state, title does not pass until that thing is done and the buyer receives notice that it has been done. c. Seller must do something to ascertain price: When a contract for sale of specified goods in a deliverable state requires a seller to weigh, measure, test, or perform another act to ascertain the price of the goods, title does not pass until the act is performed and the buyer has notice that it has been performed. d. Goods on approval: When a seller delivers goods to a buyer on approval, property passes to the buyer: • When the buyer signifies approval or acceptance; • When the time fixed for return of the goods passes and the buyer keeps the goods, without giving notice of rejection; or, • When a reasonable time for the return of the goods passes, the contract contains no fixed time for returning the goods and the buyer keeps the goods, without giving notice of rejection. e. Unascertained goods: In a contract that calls for the sale of unascertained or future goods by description, title to the goods passes to the buyer once the goods are unconditionally acquired in a deliverable state.
Describe three false, misleading, or deceptive representations prohibited by the Consumer Protection Legislation.
a. that the goods or services have sponsorship, approval, performance characteristics, accessories, uses, ingredients, benefits, or qualities they do not have; b. that the goods or services are of a particular standard, quality, grade, style, or model, if they are not; c. that the goods are new, or unused, if they are not (this excludes the reasonable use of goods to test or prepare them for delivery); d. that the goods have been used to an extent that is materially different from the fact; e. that the goods or services are available for a reason that does not exist; f. that the goods or services are available or can be delivered or performed when the person making the representation knows or ought to know they are not available or cannot be delivered or performed; g. that a service, part, replacement, or repair is needed or advisable, if it is not; h. that a specific price advantage exists, if it does not; i. that misrepresents the authority of a salesperson to negotiate the final terms of an agreement; j. that uses exaggeration, innuendo, or ambiguity about a material fact, or that fails to state a material fact if the use or failure deceives or tends to deceive; k. that misrepresents the purpose or intent of any solicitation or of any communication with a consumer; l. that misrepresents the purpose of any charge or proposed charge; and m. that misrepresents or exaggerates the benefits that are likely to flow to a consumer if the consumer helps a person obtain new or potential customers.
An enforceable contract designed to govern how the corporation will be managed and operated is referred to as a. a shareholders' agreement. b. a share certificate. c. the articles of incorporation. d. a prospectus.
A
The "minds" of the corporation are a. the directors. b. the officers. c. the incorporators. d. the shareholders.
A