BLAW - EXAM 2

If the partnership dissolves, it is immediately terminated. 1.) True. Dissolution and termination have the same result. 2.) False. There is a step between dissolution and termination.

False. There is a step between dissolution and termination.

What are some factors that courts consider in piercing the corporate veil cases?

- Grossly inadequate capitalization - Insolvency at the time the debt was incurred - Commingling of personal/corporate assets - "Alter Ego" The results are the shareholders (not directors) lose limited liability - become personally liable for corporation's debt.

What are the two kinds of third party beneficiary?

- Intended third-party beneficiary ( ex. a life insurance policy - the beneficiaries have the right to sue in breach of contract) - Incidental third-party beneficiary (Does not have the right to sue for breach of contracts they stand to benefit from)

An administrative agency does what?

- Makes rules and regulations - Enforces rules and regulations - Resolves all disputes

What are the three necessary contract elements?

- Offer - Acceptance - Consideration

What elements are necessary to form a valid contract?

- Offer - Acceptance - Consideration

Lori's List, Inc., an online directory of goods and service providers, wants to hire Mei-Ling, a noncitizen. A temporary work visa is most likely to be set aside for a noncitizen who is: 1.) A "person of extraordinary ability" 2.) A "person of ethnic similarity to the employer's workforce" 3.) A "person with an extraordinary work ethic" 4.) A "person of ordinary ability and ambition.

A "person of extraordinary ability"

In agency law, "ripeness" means that: 1.) A court may not hear a case until the agency's action or decision is final 2.) A person must use all possible methods of appeal within an agency before a court will hear the case. 3.) An agency must have substantial evidence to support its findings 4.) An agency must act deliberately and legally rather than arbitrarily.

A court may not hear a case until the agency's action and decision is final.

Beth, acting within the scope of her authority for the Cake Bake Shop, contracts with Eden Valley Orchards to buy an assortment of fruit. Cake Bake is liable on the contract, and Beth is not, if Cake Bake is: 1.) Not a principal 2.) An undisclosed principal 3.) A partially disclosed principal 4.) A disclosed principal

A disclosed principal

Copper Circuit, Inc., and Direct Electric LLC sign an agreement that provides for the payment of "$1,000 by whichever party commits a material breach of the contract that creates damages difficult to estimate but approximately $1,000." This is: 1.) A penalty clause 2.) A nominal-damages clause 3.) A liquidated damages clause 4.) A waiver-of-breach clause

A liquidated damages clause

Custom Auto, LLC, is a limited liability company. Its members include Dennis and Emma. Like other LLCs with more than one member, unless indicated otherwise, the firm will automatically be taxed as: 1.) A person 2.) A corporation 3.) A partnership 4.) A sole proprietorship

A partnership

Elements of Adverse Possession

- "Open and notorious" - "Adverse" or hostile - Continuous - Farm it or fence it? Have to make use of the property. Lay more of a claim to it. - Taxes? This is a little tricky and requires more of a truly hostile intent.

Which of the following is correct? 1.) The disclose or refrain rule applies to anyone who trades on inside information 2.) The misappropriation rule applies to people who trade on information gain through a fiduciary relationship 3.) A tippee is only liable if the tipper would be liable 4.) All of the above 5.) 2 and 3 are correct

- 2 and 3 are correct

How is an offer terminated?

- Acceptance - Revocation (can be revoked at any time before acceptance) - Rejection - Counter-offer - Lapse of Time

Definition of partnership?

- An association of two or more people - As co-owners - To carry on a business for profit.

How does an offer and acceptance work?

- An offer must be communicated, be definite/explicit and show the offeror's intent to make an offer. - An offer can be revoked at any time before it is accepted. The only exception are firm offers and option contract.

When can someone other than one of the parties to a contract enforce it?

- Assignment or rights/ delegation of duties - Third party beneficiary contract.

What are the three groups involved in the corporation's structure and governance?

- Board of directors - Officers - Shareholders

Significant differences between partnerships and corporations:

- Corporations pay taxed on profits, partnerships do not. - The corporations owners have limited liability, which means they do not have personal liability for the corporation's debts. Partners are personally liable for partnership debt. - The corporation has perpetual existence, when an owner dies or sells their share, the corporation continues its existence. When a partner dies or withdraws, the partnership dissolves. - A corporation cannot be formed by accident. Anyone wishing to incorporate a business must comply with state requirements.

What four factors will courts consider to determine if harassment has created a hostile environment?

- Frequency of the conduct - Severity of the conduct - Whether it is physically threatening or humiliating - Whether it unreasonably interferes with the employee's work performance.

What contracts must be in writing because of the statute of frauds?

- Sale of real property - Goods over $500 - In contemplation of marriage - Cannot possibly be performed within one year - Collateral promise - guarantee another's debt

What contracts must be in writing because of the Statute of Frauds?

- Sale of real property - Goods over $500 - In contemplation of marriage - Cannot possibly be performed within one year - Collateral promise - guarantee another's debt.

Performance of a contract is discharged if:

- The parties agree (mutual rescission) - A condition has not been met - The allows for a discharge (4 situations) - Bankruptcy/statutes of limitations - Impossibility/commercial impracticability. - The other party has materially breach the contract - This means the non-breaching party does not get substantially what she bargained for.

Discharge can occur in what four instances?

- The parties agree to discharge each other's performance - The contract has a condition that has not been met - The law allows for a discharge - One of the parties breaches the contract

The general goal / measure of contract remedies:

- To give the parties the "benefit of their bargain" - To put non-breaching party into the positions they would have been in had the contract been performed as promised. - Money damages are measured by the difference between the contract as promised versus the contract as performed.

The general goal/ measure of contract remedies:

- To give the parties the "benefit of their bargain" - To put the non breaching party into the position they would have been in had the contract been performed - Money damages are measured by the difference between the contract as promised versus the contract as performed.

What are the three exceptions to at-will employment?

- Violation of public policy - Express or implied contract - Violation of implied covenant of good faith and fair dealing.

Securities may be advertised and sold immediately after the registration statement is filed with the SEC: 1.) True 2.) False

False -

Shareholders always have limited liability. 1.) True 2.) False

False - They almost always do. Shield the owner from lability but not always the case. Piercing the corporate veil is the exception.

Kosmo Kramer, an employee of H&H Bagels asked for time off to attend a Festivus party at the Costanzas. Festivus is a new holiday Mr. Costanza recently invented. His motto is "A Festivus for the Rest of Us!" Kosmo's boss refused to give him time off, but Kosmo felt the celebration was so important he went anyway. When he returned to work the next day, his boss fired him. To prove he was fired in violation of Title VII, what will Kosmo have to prove? 1.) that he holds his beliefs in Festivus with the strength of a traditional religious belief. 2.) That his employer failed to reasonably accommodate his religious belief. 3.) That he had been employed at H&H Bagels for a certain number of weeks in the preceding year 4.)Kosmo will have to prove all of the above 5.) Kosmo will only have to prove A & B above

Kosmo will only have to prove A & B above

Fact Pattern 16-1 Kristin and Lindsey are partners in Mobile Devise, an online marketing firm. Refer to Fact Pattern 16-1. Lindsey dissociates from Mobile. Kristin signs a contract with Organic Olives, a food seller, apparently on Mobile's behalf. Organic Olives does not know of Lindsey's dissociation. The contract is binding on: 1.) Kristin, Lindsey and Mobile 2.) Kristin only 3.) Mobile Only 4.) Organic Olives Only

Kristin, Lindsey and Mobile.

Data Accountants, a private employer, handles bookkeeping for small employers. In most circumstances, with exceptions, federal law clearly prohibits Data from subjecting its employees to: 1.) Lie-detector tests 2.) Job-skills test 3.) Drug test 4.) Monitoring of business communications

Lie-dectector tests

What is the concept of double taxation?

Means the corporation as a fully separate legal "person" must pay its own income taxes. If the corporation pays dividends to shareholders, the shareholders must pay personal income tax on that money. Thus the same money is taxed twice.

Workforce Comparison Method definition:

"involves a statistical comparison of the representation of the relevant protected group in the employer's workforce with the protected group's representation in the relevant labor market (the area from which the employer draws most of its employees -- it may be local or even national, depending on the job in question)."

Four types of ownership of real property:

- Fee simple absolute - Fee simple determinable - Fee simple subject to condition subsequent - Life estate - Future Interest

What is partnership property?

- Property purchased with partnership funds is presumed to be partnership property. - But ultimately... the partners' intent determines who owns property purchased with partnership funds. - If there's no evidence of intent, the above rule applies.

Corporate Structure?

- Shareholder - Board of directors - Officers

Performance of a contract is discharged if:

- The parties agree - A condition has not been met - The law allows for a discharge - The other party has materially breached the contract - This means the non-breaching party does not get substantially what she bargained for.

How will court determine which type of business entity is formed?

- Whether the people shared profits. - Whether these people shared the right to manage the partnership. - The most significant being profit sharing.

Main points of piercing the corporate veil:

-Piercing the corporate veil generally occurs when one or two dominant shareholders are running the whole show. - It only occurs when the corporation owes an outside third party money and doesn't have the assets to pay the debt. If there are enough corporate assets to satisfy the debt, the third party creditor would have no reason to want to satisfy the debt from the owners' personal assets! - Make sure you know the four factors courts will consider when deciding whether to allow a third party to pierce the corporate veil. - The result of piercing the corporate veil is that owners are liable for the debt. Piercing the corporate veil is not a director or officer question! Even though the dominant shareholders in question may also be directors and/or officers, they are liable in this situation as owners, not as directors or officers. So to figure out whether a particular case presents a piercing the corporate veil issue, ask yourself, "Who is suing whom?" If someone outside the company is suing the owners, it's a piercing the corporate veil question. If the shareholders are upset with the directors, that is not a piercing the corporate veil question - it's probably a breach of fiduciary duty issue instead (which is discussed below).

What is the EEOC's procedure for handling complaints?

1.) Investigate the complaint. This includes interviewing anyone who might have information. 2.) The agency will attempt to conciliate or negotiate a settlement between the two parties. 3.) If the parties do not settle the case, the agency MAY litigate the issue by filing a lawsuit in federal court on behalf of the employee.

What is a general agent?

A general agent is typically one who performs a wide range of duties for the principal and uses their own discretion in variety of areas (ex. an employee)

While driving a truck for AAA Co. (within the scope of employment) Vic causes an accident and injures Wendy. Wendy can recover from: 1.) AAA only 2.) Vic only 3.) AAA and/or Vic 4.) Her insurance company only

AAA and/or Vic

While driving a truck for AAA Co.(within the scope of employment) Vic causes an accident and injures Wendy. Wendy can recover from: 1.) AAA only 2.) Vic only 3.) AAA and/or Vic 4.) Her insurance company only

AAA and/or Vic

Aircraft Corporation employs aircraft mechanics, computer programmers, outside salespersons, and professionals, including pilots. Employees exempt from the Fair Labor Standards Act's overtime provisions include all of the following except: 1.) Outside salesperson 2.) Computer programmers 3.) Aircraft mechanics 4.) Professionals.

Aircraft mechanics

What is proof of claim?

Any creditor listed in the debtor's bankruptcy petition are of course notified and asked to file a proof of claim, stating the amount the creditor claims is due.

Jason and Kelly enter into a contract for Jason to renovate Kelly's house by a certain date. Jason never performs. After the applicable limitations period has passed, Kelly decides to bring a suit against Jason for breach. This suit: 1.) Must be filed within ten to twenty years, depending on state law 2.) Can no longer be brought 3.) Can be filed within four years after Kelly decides to sue 4.) Must be filed between four and five years after Kelly decides to sue.

Can no longer be brought.

Contract duties may be: 1.) Assigned 2.) Delegated 3.) Either assigned or delegated

Delegated

Cal employs Daily Employment Agency as an agent under a written agreement that describes the rights and duties of both parties. This describes: 1.) Apparent authority 2.) Equal authority 3.) Express authority 4.) Implied authority 5.) Ratification of authority

Express authority

Unlike any of the rest of the more complex business associations you will study (LLC, LLP, or corporation) a partnership does not require a formal agreement or formal documentation to create, is a?

Formation.

Belle is an employee of College Cafeterias, Inc., covered by federal overtime provisions, which apply only after an employee has worked more than​: 1.) Seven and a half hours in a day 2.) Eight hours in a day 3.) Forty hours in a week 4.) One year for the same employer

Forty hours in a week.

Alex, a famous baseball player, was asked to autograph a pad of paper held by Betty. Unknown to Alex, Betty had carefully concealed a contract for the sale of Alex's home to Betty in the pad that Alex signed. If Betty seeks to enforce the contract, Alex's best defense to have the contract declared void would be: 1.) Fraud in the inducement 2.) Fraud in the execution 3.) Statute of frauds 4.) Unilateral mistake

Fraud in the execution.

Idaho adopted the covenant of?

Good faith and fair dealing. "Any action by either party which violates, nullifies or significantly impairs any benefit of the employment contract"

When does the UCC allow the offeree to revoke acceptance of goods that do not conform to the contract?

If the non-conformity substantially impairs the value of the contract.

What is the mailbox rule?

It means that acceptance is effective at the moment it is sent, not when it is received.

What does at-will employment mean?

It means that an employee can quit their job at any time for any reason or no reason at all. And that their employer may terminate employment at any time for any reason or no reason at all. Exceptions are Title VII and 1964 Civil Rights Act, The Americans with Disabilities Act and the Age discrimination in Employment Act.

What is the Parol Evidence Rule?

It prohibits one party to the contract from testifying in court or otherwise introducing evidence about what the terms of the contract are if the contract is fully integrates, meaning containing their entire agreement.

What is a chapter 11 bankruptcy?

Mean the debtor hopes to reorganize his debt (pay as much of it as possible) and continue to operate his business.

What is a chapter 7 bankruptcy?

Means complete liquidation of all of the debtor's non-exempt assets, which are used to pay the debts.

What does Duty of Loyalty mean?

Means that directors must always act in the best interest of the corporation, instead of their own personal best interest.

Personal Liability:

Means that if the partnership cannot pay its debts, creditors who are owed money by the partnership can go after the partners' personal assets.

Implied contract is:

Might occur when the employer provides employees with a personnel or policy handbook. Now most employers who do provide employees with policy manual include a large disclaimer informing employees that the terms of the manual do not create a contract.

Hospital Corporation employs seven thousand workers in seven locations. These employees have the right to: 1.) Demand that Hospital Corporation be a closed shop 2.) Organize 3.) None of these choices 4.) Make "hot-cargo" agreements

Organize

Livia takes temporary family leave from her job at Manufacturers Corporation to care for a new baby. Assuming Livia is not a key employee, on Livia's return from the leave, Manufacturers must: 1.) Restore Livia to her same position or a comparable position 2.) Reimburse Livia for her expense while on leave 3.) Promote Livia to the status of a key employee 4.) Do nothing

Restore Livia to her same position or a comparable position.

Express employment contract is:

Simply a written contract which covers most or all of the terms of employment.

Adverse possession typically occurs when:

Small pieces of land in a boundary dispute.

The type of business entity in which there is no legal distinction between the owner and the business is called a: 1.) Partnership 2.) Limited partnership 3.) Limited liability company 4.) Corporation 5.) Sole proprietorship

Sole proprietorship

The Statute of Frauds means that: 1.) Contracts entered into because of fraud are voidable 2.) Some contracts have to be in writing or they are not enforceable 3.) Each of the above

Some contracts have to be in writing or they are not enforceable.

Gina believes that she is a victim of employment discrimination that falls under Title VII of the Civil Rights Act. Compliance with Title VII is monitored by: 1.) Employees and jobs applicants, not an administrative agency 2.) The courts and congress, not an administrative agency 3.) Employers and business, not an administrative agency 4.) The Equal Employment Opportunity Commission

The Equal Employment Opportunity Comission

To determine what law applies to a contract that contains both a good and a service, one must apply: 1.) The mirror image rule 2.) The Statute of Frauds 3.) The 4/5 rule 4.) The predominant purpose test

The predominant purpose test

Tom sold ad space for Boise Magazine for three years. Two days after he's laid off, he sells a 5" ad to Chronic Taco, an existing customer, who does not know he was fired. 1.) Tom had authority to sell the ad. Why? 2.) Tom did not have authority to sell the ad. Why? 3.) I need to review Chapter 8!!

Tom had the authority to sell the ad. Why? He had apparent authority. Two type of actual authority are express & implied. And apparent authority.

A principal will be liable for: 1.) Torts of an independent contractor 2.) Torts of an employee 3.) Torts of either an independent contract or an employee

Tort of an employee

Berry Fields, Inc., employs hundreds of seasonal and permanent workers, both skilled and unskilled, in three states. Under federal immigration law, Berry Fields can hire illegal immigrants​: 1.) If either the employer or the immigrants file special form 2.) Only if the employer files a special form 3.) Only if the immigrants file special forms 4.) Under no circumstances

Under no circumstances

Like the bylaws of other corporations, the bylaws of Rocks, Paper & Scissors, Inc: 1.) Establish the operating name of the corporation. 2.) Were submitted for approval to the public official in charge. 3.) Were adopted at its first organizational meeting. 4.) Establish the value and classes of corporate stock.

Were adopted at the first organizational meeting.

when does hostile-environment harassment occur?

When the harasser makes unwelcome sexual comments or taunts, or otherwise engages in unwelcome conduct of sexual nature.

What are the articles of partnership?

if the parties decide to form a partnership, the written contract .

What is the burden of proof?

the obligation to prove one's assertion/ the merits of their case.

What are the two types of sexual harrassment?

- Quid pro quo - Hostile environment

Title VII specifically prohibits employment discrimination on the basis of:

- Race - Color - Gender - Religion - National Origin

5 protected classes created by Title VII?

- Race - Color - Religion - Gender - National Origin

Alice replaces Ben in his job at the Commercial Business Corporation (CBC). Ben believes he has been discriminated against on the basis of his age. For the Age Discrimination in Employment Act (ADEA) to apply: 1.) Alice must be forty years of age or older 2.) All parties must be forty years of age or younger 3.) Ben must be forty years of age or older 4.) CBC must have been in existence for at least 40 years 5.) CBC must have at least 40 employees.

Ben must be forty years of age or older.

Adam is a sole proprietor. He must file for bankruptcy to reorganize his debt under a repayment plan so he can pay his creditors and continue operating his business. He should file a: 1.) Chapter 10 bankruptcy 2.) Chapter 7 bankruptcy 3.) Chapter 13 bankruptcy 4.) Chapter 12 bankruptcy

Chapter 13 bankruptcy.

Acceptance has to be the mirror image of an offer or else it is a?

Counter offer

Garry drives a truck as an employee for Heavy Hauling, Inc. Garry would most likely be considered acting outside the scope of his employment if he; 1.) Ran over an attendant at Quik's gas station while refueling the truck 2.) Hit a pedestrian in a parking lot during a "working" lunch 3.) Smashed into a store-front while intoxicated on-duty. 4.) Crashed into a car at the airport while off duty.

Crashed into a car at the airport while off duty.

What can never justify a BFOQ (Bona Fide Occupational Qualifications)?

Race and color.

When an agent acts with no authority at all (actual or apparent) to bind the principal to a contract. The principal will become bound to it if?

The principal ratifies it.

What is the appropriate state agency in Idaho?

Idaho Human Rights Commission.

Solar Panels Corporation requires its employees to have a high school diploma, claiming a connection between a high school education and job performance. In a suit against Solar under Title VII of the Civil Rights Act, this is shown to have a discriminatory effect. Solar has: 1.) A bona fide occupational qualification defense 2.) Seniority system defense 3.) A business necessity defense 4.) No defense

A business necessity defense

State University (SU) provides housing on campus and in some adjacent off-campus neighborhoods. To lease a university house or apartment, a person must be student at SU. This requirement is​: 1.) A discharge by performance 2.) A material alteration 3.) An accord and satisfaction 4.) A condition

A condition

National Labor Relationship Act (NLRA) applies to?

All employees (except those specifically exempt from the act) not simply those who have joined or are attempting to form a union.

Which statement is accurate? 1.) A contract is required to create an agency relationship. 2.) Agents and principals owe each other fiduciary duties. 3.) All employees are agents, but not all agents are employees. 4.) Principals always have the right to terminate an agency relationship.

All employees are agents, but not all agents are employees.

Revenue & Sales Corporation and Software, Inc., enter into a contract for the design of custom software for which Revenue & Sales agrees to pay $64,500. Software transfers the right to payment under the contract to CreditLine LLC. This transfer is: 1.) An assignment 2.) A delegation 3.) A third-party beneficiary contract 4.) Prohibited

An assignment

A partnership is defined as: 1.) A group of people operating to make to profit 2.) A group of people who operate a business and share profits and losses 3.) An association of two or more people, as co-owners, to carry on business for profit. 4.) An association of two or more people, as co-workers, to carry on a business for profit. 5.) A form of unincorporated business whose owners enjoy limited liability.

An association of two or more people, as co-owners, to carry on a business for profit.

What is a good example of "Sex-Plus"?

An example of "sex-plus" discrimination is an employer who refuses to hire women with young children, yet will hire men with children the same age, believing that women are more likely than men to be absent from work because of their children's needs.

Lyle and Miranda agree that Lyle will fix the refrigeration unit in Miranda's Buns n' Burgers in exchange for her payment of a debt that Lyle owes to New Credit Corporation. New Credit is​: 1.) A delegatee 2.) An intended beneficiary 3.) An incidental beneficiary 4.) An obligor

An intended beneficiary.

Cliff is a member of Dental Clinic, LLC. Cliff can participate in the firm's management to: 1.) The extent that he assumes liability for the firm's debts 2.) Any extent 3.) No extent 4.) The extent of his investment in the firm

Any extent

The best definition of security is:

Any financing scheme by which investors make profits through the efforts of others.

Nell is considering forms of business organization for Optic Center, a medical eye clinic. An advantage of a limited liability partnership is that, depending on the applicable state statute, partners can avoid personal liability for​: 1.) Their own wrongful acts 2.) Any partnership obligation 3.) Their own and other partners' wrongful acts 4.) None of the choices

Any partnership obligations

Based on Oona's conduct, Porcio reasonably believes that Qasim has the authority to act on Oona's behalf even though Qasim does not have the actual authority to do so. In this circumstance, Qasim has​: 1.) Implied authority 2.) Express authority 3.) No authority 4.) Apparent authority

Apparent authority

Respondeat Superior:

Applies to torts committed by employees: an employer is liable for torts committed by an employee if the employee was acting within the course and scope of employment at the time the tort occured.

David, a partner in the Tri-State Express Mail delivery partnership, negligently drove his delivery truck onto the curb during a rush-hour package delivery. Marlene was injured. Who of the following may be liable to Marlene for her injuries? 1.) Only David 2.) Tri-State express mail partnership 3.) Any partner, personally 4.) B and C 5.) Marlene will have to pay her damages herself

B & C

Which of the following is true of Section 7 of the National Labor Relations Act (NLRA)? 1.) It only applies to employees who are members of a union. 2.) It applies to all employees without regard to whether they are in a union. 3.) It gives covered employees the right to engage in concerted activity for their mutual aid and protection. This means, for example, that employer policies which prohibit employees from discussing their wages with each other may be illegal. 4.) A and C. 5.) B and C.

B and C

A grocery store clerk at Best Foods spills syrup on the floor and does not clean it up. A customer slips on the syrup and breaks her arm. Which statement is correct? 1.) Best Foods is liable because the clerk acted within the scope of her employment 2.) Best Foods is liable because of the "special agent" rule 3.) Best Foods is not liable because the clerk simply made a mistake are the customer had responsibility 4.) Best Foods is not liable because it was not negligent 5.) Only the clerk is liable for her own negligence.

Best Foods is liable because the clerk acted within the scope of her employment.

Ann and Bill form Consumer Sales, Inc. Ultimate responsibility for policy decisions necessary to the management of corporate affairs rests with Consumer's: 1.) Incorporators 2.) Promoters 3.) Officers 4.) Shareholders 5.) Board of directors

Board of directors

Katrina and Shannon form a general partnership to operate a gourmet kitchen business. In most states, if they do not specify their respective management rights then: 1.) One partner has superior management rights 2.) The partner who invested more capital has a greater voice in management 3.) Both partners have equal management rights 4.) One partner manages the business and the other provides the capital.

Both partners have equal management rights.

Adam is a partner in the ABC partnership. He owes a fiduciary duty to: 1.) The ABC partnership only since it is the principal 2.) Bob and Charlie 3.) Both the ABC partnership and Bob and Charlie

Both the ABC partnership and Bob and Charlie. He owes a duty to the principal. Partners owe each other a fiduciary duty as well because they personally own partnership debt.

Carolina files for Chapter 7 bankruptcy and the automatic stay goes into effect. Even so, which of the following creditors may continue to collect the debt owed by Carolina? 1.) The bank to whom she owed $250,000 on a mortgage for her home 2.) The car dealer from whom Carolina bought her Mercedes two years ago 3.) Carolina's credit card company to whom she owes $12,425 for a trip to Paris six months ago 4.) Carolina's first husband to whom she owes monthly support payments.

Carolina's first husband to whom she owes monthly support payments to.

Chet, a minor, signs a contract with Denise, an adult. The contract is voidable at the option of: 1.) Either party 2.) Neither party 3.) Chet only 4.) Denise only

Chet only

The primary federal statute regulating air pollution is: 1.) The National Environmental Policy Act 2.) Clean Air Act 3.) Air Quality Act 4.) National Air Quality Standards Act

Clean air act

Ron operates a scrap metal business and contracts to provide ten tons of scrap steel at $50 per ton to be delivered to Paul in six months. An unforeseen shortage of scrap steel suddenly develops, making it impossible for Ron to fulfill his contract for less than $500 per ton. Ron's best defense against performing the contract would be: 1.) The mirror image rule 2.) Impossibility of performance 3.) The mailbox rule 4.) Anticipatory repudiation

Commercial impracticability.

What is a unilateral contract?

Contains only one promise. And a contract only is formed when the other party accepts the offer by performing the task or promise.

Breach of duty is determined by applying the _______________ Rule. Which means that the directors may not take an opportunity the corporation might be interested in and use it for their own personal benefit. Essentially its fiduciary duty.

Corporate Opportunity Rule.

Dad and Adam own a rental house as joint tenants. Adam dies. Adam's will provides that Molly is his heir. Who now owns the house? 1.) Dad owns the house because of the right of survivorship 2.) Dad and Molly own the house because Molly is Adam's heir. 3.) Dad and Molly own the house because Molly had future interest.

Dad owns the house because of the right of survivorship. You can't leave interest in joint tenancy to your heirs.

What are incidental damages?

Damages incurred in an attempt to mitigate.

What are compensatory damages?

Damages which compensate or make the non-breaching party whole.

Contract duties may be: 1.) Assigned 2.) Delegated 3.) Either of the above

Delegated Note: Contract rights are assigned. Contract duties are delegated.

ABC Partnership has no agreement on how profits and losses will be divided. Adam invested 50% of the partnership start-up $$. Bob & Charlie each invested 25%. 1.) Adam will receive 50% of the profits, Bob and Charlie will each receive 25% 2.) Each partner will receive 33% of the profits.

Each partner will receive 33% of the profits. If you don't have agreement as to how profits will be divided, the Revised Uniform Partnership Act kicks in. Profits and losses will be shared equally in this act.

Termination of an agency occurs when?

Either the principal or the agent withdraws consent.

________ is a federal agency which administers and enforces Title VII.

Equal Employment Opportunity Commision (EEOC)

​Kali contracts to sell Leony her car for $3,000. This contract will be fully discharged when Kali and Leony: 1.) Sign a receipt 2.) Exchange the car for $3000 3.) Shake hands and go their separate ways 4.) Agree to sign a bill of sale

Exchange the car for the $3000

An agent always has the right to withdraw her consent and terminate the agency relationship. 1.) True 2.) False

False

Idaho is a right-to-work state. This means generally that employees can be fired for any reason. 1.) True 2.) False

False

Which of the following describes the duty of loyalty and good faith that is held by a person in a position of trust and confidence? 1.) Fiduciary duty 2.) Fellow servant duty 3.) Duty to act reasonably 4.) Duty to avoid harm 5.) Principal duty

Fiduciary duty

Dock Workers Union believes that Emerging Market Corporation has violated a federal labor law. The appropriate step is for the union to: 1.) Petition the president of the U.S 2.) File a suit in the appropriate federal court 3.) Call a strike 4.) File a complaint with the National Labor Relations Board

File a complaint with the National Labor Relations Board

Fixit Co., a four-person business, employees Wesley as a full-time mechanic. One day, while welding a frame modification on a sports car, Wesley paid no attention to a clearly visible oil leak dripping from the engine compartment of the car. The welding torch ignited the oil causing a fire in which Wesley was badly burned. Which of the following BEST describes the rights of the parties? 1.) Fixit is liable to Wesley under a workers' compensation statute despite the fact that Wesley may have been contributorily negligent when he ignored the oil leak. 2.) Wesley cannot recover worker's compensation since federal law requires that an employer have at least 15 employees before he must provide workers' compensation benefits. 3.) Fixit is not liable to pay Wesley workers comp since Wesley fell below a recognized standard of care by auto mechanics 4.) Wesley cannot recover workers' comp benefits but can sue fixit for failing to provide a safe working environment. 5.) Wesley will recover workers' comp benefits only if he tested positive on a drug test.

Fixit is liable to Wesley under a workers' compensation statute despite the fact that Wesley may have been contributorily negligent when he ignored the oil leak.

What does consideration mean?

Generally means that each party to the contract must give up something of value before the law will enforce their promises. Something of value refers to a promise to do something one is not otherwise legally obligated to do or to refrain from doing something one is legally privileged to do.

What is the business judgement rule?

If the board makes decisions by exercising business judgement, they will not be liable for their decisions, even those that turn out bad for the company.

What is the partnership rule?

If the parties do not have a written agreement, profits and losses will be shared equally, not according to the amount of each partners' initial contribution.

Chip Makers Union would like Digital Products, Inc., to require union membership of its job applicants as a condition for obtaining employment. This is: 1.) Illegal in all states 2.) Legal in any employment-at-will state 3.) Illegal only in states that have right-to-work laws 4.) Legal in all states 5.) Legal only in states that have right-to-work laws.

Illegal only in states that have right-to-work laws.

John contracts with Kelly to buy a certain number of cattle for Kelly's Circle K ranch. John makes a deal with Lawson, the owner of a local herd, and makes a down payment. Kelly fails to pay the rest of the price. Lawson sues John for breach of contract. John's right to hold Kelly liable for any damages that he has to pay is the right of: 1.) Indemnification 2.) Compensation 3.) Reimbursement 4.) Cooperation

Indemnification.

What is apparent authority?

Is an exception to the general rule that an agency relationship requires the consent of both agent and principal before the agent's actions bind the principal. Sometimes an agent can bind a principal even when he has no authority to do so.

Acceptance of an offer: 1.) Is determined when acceptance is received 2.) Is determined when acceptance is sent 3.) Must always be in writing 4.) Both A and C

Is determined when acceptance is sent.

Mike is a shareholder of NatGas, Inc. NatGas uses cumulative voting to elect directors. This means that the number of Mike's votes is determined by the number of; 1.) Years that he has been a shareholder 2.) Members of the board to be elected multiplied by the total number of voting shares that he holds 3.) Shareholders present at the shareholders' meeting 4.) Shareholders' meetings that he has attended.

Members of the board to be elected multiplied by the total number of voting shares that he holds.

Under common law, the ________________ rule applies, which means the acceptance must be identical to the offer to form a contract.

Mirror Image Rule (The mirror image rule does not apply under the UCC) (If the acceptance is different - then it is a counter offer instead of an acceptance.)

A lease is a: 1.) Freehold estate 2.) Non-freehold estate 3.) Concurrent interest 4.) Future interest

Non-freehold estate. Freehold implies ownership.

Quisa and Reilly are partners in Sport Bikes, which rents and sells bikes, bike accessories, and related gear. Quisa manages the business. Unless the partnership agreement states otherwise, Quisa is: 1.) Entitled to compensation in proportion to her capital contribution 2.) Not entitled to compensation 3.) Entitled to compensation in proportion to her effort 4.) Entitled to compensation in proportion to her effect on the business.

Not entitled to compensation

Carlos and David contract for the sale of five hundred head of Carlos's cattle for $95 per head. Unknown to either party, an unforeseen storm has struck the herd and many of the cattle have died. David is: 1.) Not required to pay due to bilateral mistake 2.) Not required to pay due to the unilateral mistake 3.) Required to pay because he assumed the risk the cattle might die 4.) Entitled to recover the value of the lost cattle.

Not required to pay due to the bilateral mistake.

What is an offer?

Occurs when the offeror indicates their willingness to enter into a bargain and to be bound by the offer if it is accepted. Typically, an offer may be withdrawn any time before it is accepted. The exceptions to that rule are under the common law, an option contract and a firm offer (does not require consideration) under the UCC.

Under the corporate opportunity rule: 1.) Officers and directors may personally benefit from an opportunity in which the corporation would have been interested. 2.) Officers and directors may not personally benefit from an opportunity in which the corporation would have been interested. 3.) Shareholders may not personally benefit from an opportunity in which the corporation would have been interested. 4.) Directors are bound to accept any reasonable offer by an outside investor for all or substantially all of the outstanding stock of the corporation. 5.) Directors are not required to accept a reasonable offer by an outside investor for all or substantially all of the outstanding stock of the corporation, if it would impair their ability to receive compensation under a golden parachute.

Officers and directors may not personally benefit from an opportunity in which the corporation would have been interested.

What is a bilateral contract?

One in which both parties exchange promises with each other to create a contract.

Cumulative voting means?

One vote per share times the number of board members to be elected.

Kay and Linda decide to do business as Marketing & Promotion. To be a partnership, this association can result from an agreement that is: 1.) Express, but not implied 2.) Written but not oral or implied 3.) Oral, written or implied by conduct 4.) Implied but not express.

Oral, written, or implied by conduct.

Quinn contracts to provide ten tons of scrap steel at $500 per ton to Rendered Materials, Inc. An unforeseen shortage of scrap steel suddenly develops, making it impossible for Quinn to fulfill the contract for less than $5,000 per ton. Quinn's best defense against performing the contract would be that: 1.) The law has rendered performance of the contract illegal 2.) Performance of the contract is commercially impracticable 3.) The specific subject matter of the contract has been destroyed 4.) Procuring the steel would force Quinn into bankruptcy.

Performance of the contract is commercially impracticable.

Jess and Keri are members of Livewire LLC, a limited liability company. In most situations, with respect to Livewire's debts, Jess and Keri are shielded from: 1.) Personal liability 2.) All liability 3.) No liability 4.) "Corporate veil" liability.

Personal Liability

Paul is driving a truck delivering goods for his partnership when he negligently backs into a customer's new Mercedes. The customer sues the partnership and recovers $5000 in damages. What liability do the other partners have for Paul's actions? 1.) No liability 2.) Liability based upon their initial capital contributions 3.) Personal liability 4.) Liability based upon what their written agreement provides 5.) I don't know what liability means.

Personal Liability.

Title VII was amended in 1978 to include the ___________, which requires all employers to treat pregnant employees the same as any employees suffering from non-pregnancy related temporary disabilities.

Pregnancy Discrimination Act

The employee Polygraph Protection Act of 1988 does what?

Prohibits almost all polygraph testing of employees. May be able to be administered under limited circumstances when investigating workplace theft.

What is an automatic stay?

Prohibits creditors from making any attempt to collect on debt, including filing or continuing a lawsuit.

Resort Hotel Company replaces Sharon, a forty-five-year-old employee, with Terry. Sharon files a suit against the employer under the Age Discrimination in Employment Act. To establish a prima facie case, she must show, among other things, that she is: 1.) Older than the person who replaced her 2.) Generally more dependable than the individual who replaced her 3.) Qualified for the position 4.) Deserving of higher pay than the individual who replaced her

Qualified for the position

Ruth is a supervisor for Subs, a restaurant. Tim is a Subs employee. The owner announces that some employees will be discharged. Ruth tells Tim that for sexual favors, she will give him an excellent performance review and recommend a raise. This is: 1.) Hostile-environment harassment 2.) Not harassment 3.) Harassment on the basis of sexual orientation 4.) Quid Pro Quo harassment

Quid Pro Quo harassment

Lauren files a suit against Moving Service for breach of contract, based on what Lauren claims was Moving's offer. For a court to determine if a contract has been breached, under the common law, the offer must include terms that are: 1.) Reasonably definite 2.) Vague or uncertain 3.) Unequivocally approximate 4.) Exactly precise

Reasonably definite

Inez files an employment discrimination suit against Jiffy Delivery Service, Inc., under the Civil Rights Act, based on Jiffy's discharge of Inez. Possible relief includes: 1.) Fines 2.) Reinstatement 3.) Imprisonment 4.) An order to shutdown the employer's business.

Reinstatement

Ann offers to buy a laser printer, with a case of paper and an extra cartridge, from Best Office Products, for $200. Curt, Best's representative, says, "OK, but no paper and no extra cartridge." Curt has: 1.) Accepted the offer 2.) Made a counteroffer without rejecting the offer 3.) Rejected the offer without making counteroffer 4.) Lost out on a good opportunity to get rid of that old printer cartridge.

Rejected the offer and made a counteroffer.

Sara owns a coffee shop. She hires Howard to manage the shop. Which of the following best describes their relationship? 1.) Sara, the employer is the general agent and Howard, the employee is the principal 2.) Sara, the employer, is the general agent. Howard, the employee is an independent contractor 3.) Sara is the general partner and Howard is the limited partner. 4.) Sara, the employer is the principal and Howard, the employee, is the general agent. 5.) Sara, the employer is the principal. Howard, the employee, is neither a general agent or an independent contractor, because he's a manager. Managers are exempt from agency law.

Sara, the employer, is the principal. Howard, the employee is the general agent.

Dane is a director of Eco Packing Company. Dane's rights, as a director, do not include a right to: 1.) Inspection 2.) Self-dealing 3.) Reimbursement 4.) Participation

Self-dealing

Duty of Care?

Shareholders have the right to expect the directors to exercise their responsibilities thoroughly and carefully. They also have the right to expect that all decisions will be researched and carefully made. The directors "duty of care" is to manage the corporation in a reasonable and competent manner.

An at-will employee can be fired for which of the following reasons? 1.) She's an Idaho Vandal who works on a team of Bronco Boosters 2.) She doesn't share her supervisor's religious beliefs. 3.) She's a juror on a six week murder trial 4.) 1 and 3 only

She's an Idaho Vandal who works on a team of Bronco Boosters.

The employees of Beverage Bottling Company designate Cola Cappers Union as their bargaining representative. The employer refuses to bargain with the union over wages and working conditions. This violates: 1.) The Fair Labor Standards Act 2.) The National Labor Relations Act 3.) No federal law 4.) The Social Security Act

The National Labor Relations Act

A contract for a new surf board would be governed by: 1.) The common law 2.) The Uniform Commercial Code (UCC)

The Uniform Commercial Code (UCC)

What are priority debts?

The bankruptcy court will order debts to be paid in a particular order of priority. The courts costs are paid first. Wages, salaries and commissions owed to the debtor's employees have high priority as well. Debt owed on a visa card ( unsecured debt) is the lowest priority in ranking.

What is a bankruptcy estate?

The bankruptcy estate includes all of the debtor's assets at the time the petition is filed. This also includes any preferential transfer, which is any assets transferred out of the estate 90 days prior to the filing of the petition.

The general measure of contract damages is:

The difference between the contract as promised and the contract as performed.

Ernie is a director of Five-Star Properties, Inc. Ernie is a property appraiser. Five-Star makes several purchases in which it pays too much. Ernie approves all the transactions without evaluating them. He is most likely liable for breach of: 1.) None of these choices 2.) The duty of care 3.) The business judgement rule 4.) The duty of loyalty.

The duty of care

Carlo is a director of Desserts Italiano, Inc. Carlo opposes a tender offer that is in the company's best interest because its acceptance would cost his position as a director. Carlo is most likely liable for a breach of: 1.) The business judgement rule 2.) None of these choices 3.) The duty of care 4.) The duty of loyalty.

The duty of loyalty.

Quid pro quo sexual harassment occurs when...

The employee's job status or benefits are conditioned on submission to requests for sexual favors.

Tim works for University Food Service, Inc. The employer's discharge of Tim outside the terms of an oral employment contract may result in: 1.) The employer's liability for breach of contract 2.) None of the choices 3.) The employee's ineligibility for unemployment compensation 4.) The imposition of an express employment contract on the employer.

The employer's liability for breach of contract.

Tim works for University Food Service, Inc. The employer's discharge of Tim outside the terms of an oral employment contract may result in: 1.) The employers liability for breach of contract 2.) The employee's ineligibility for unemployment compensation 3.) None of the choices 4.) The imposition of an express employment contract on the employer.

The employer's liability for breach of contract.

Avery wants to go into business as Boom! to make and market fireworks. When deciding which form of business organization would be most appropriate, Avery would normally take into account all of the following except: 1.) The need for capital 2.) The liability of the owners 3.) Tax considerations 4.) The forms of competitors' business organizations.

The forms of competitors' business organizations.

What is actual authority?

The principal has given the agent the authority to act. Express actual authority is clearly spelled out or expressed in the agreement or relationship between the agent and the principal. Implied actual authority is not expressly granted by the principal but is implied because of the nature of the agency.

Analytic Projections, Inc., a data analysis firm, wants to hire Benazir, a noncitizen. A work visa is most likely to be set aside for a noncitizen if: 1.) Hiring the worker will not adversely affect other workers similarly employed. 2.) There is no shortage of qualified U.S. workers capable of doing the work. 3.)The noncitizen is a "person with an extraordinary work ethic." 4.) The noncitizen is of "ethnic similarity to the employer's workforce."

There is no shortage of qualified US workers capable of doing the work.

I promise to pay you $2000 if you promise to have my bathroom remodeled by the 1st day of school: 1.) This would be a unilateral contract 2.) This would be a bilateral contract 3.) This contract is not supported by consideration because $2000 isn't enough.

This would be a bilateral contract.

Bob, a partner of XYZ Partnership, injures David while doing partnership business. XYZ is liable to David because of Bob's tort. 1.) True 2.) False

True - Partnership will be liable for torts committed by the partner if the partner was doing partnership business.

Sam, another partner in XYZ partnership, is personally liable to David because of Bob's tort. 1.) True 2.) False

True - why? All partners are personally liable for partnership debt. Because bob was carrying on personal business.

Promoters will be personally liable for contracts entered into on behalf of the corporation. 1.) True, unless or until the corporation adopts the contracts. 2.) False, the promoter was an agent and so cannot be liable for the contract.

True, unless or until the corporation adopts the contracts.

Cashing a check that says "payment in full" will stop the person from collecting more, even if the amount owed is disputed. 1.) True. If there is a dispute, don't cash the check! 2.) False. A debt is a debt. "Payment in full" generally does not work to satisfy the entire debt.

True. If there is a dispute, don't cash the check!

Industrial Engineering, Inc., promises to give stock options to Jasmine for processes she has already designed for the firm. This promise is enforceable: 1.) Because it is supported by past consideration 2.) Under no circumstances 3.) Because it is a new contract 4.) Because it is an illusory promise

Under no circumstances.

Gene, an accountant, convinces his client Hazel to sign a contract to invest her savings in 2Gether, a nonexistent social-networking Web site. There is clear and convincing evidence that Hazel did not act out of her free will. This is​: 1.) Duress 2.) Fraud 3.) Mistake 4.) Undue Influence

Undue influence.

A contract in which acceptance is expected in the form of the performance of some act by the offeree is a(n): 1.) Collateral contract 2.) Bilateral contract 3.) Conditional contract 4.) Unilateral contract

Unilateral contract.

What is a chapter 13 bankruptcy?

Usually filed by a debtor who typically accumulated debt because he was out of work (either laid off or ill) but now has a regular source of income with which to pay off some of the debt.

The public policy exception to employment at will means that "it is unlawful to terminate an employee for doing something that the official public policy of the state supports or promotes, such as refusing to break the law." is what?

Violation of Public Policy. An employee cannot be fired for doing something the law requires, such as jury duty.

Regarding administrative agencies, when does the "abuse of discretion rule" apply? 1.) When a court reviews the agency's findings of fact 2.) When a court reviews the agency's conclusion of law 3.) Both of the above

When a court reviews the agency's conclusion of law.

What is the most common way for a partnership to be terminated?

When one partner withdraws. (However a partnership is not terminated until the winding up period is completed.)

An agency relationship is created when?

When parties, agent and principal, consent to enter into such a relationship. The agent agrees that the acts they take on behalf of the principal will not be for their benefit but for the benefit of the principal. The principal has the right to specify the agent's duties and responsibilities.

Dilbert works for Crane Toys. The president of the company tells him repeatedly that his work is excellent, and that if his performance remains good, he can work for Crane as long as he likes. About one week after the most recent of these statements to Dilbert, his supervisor fires him, claiming that even though Dilbert does excellent work, he just does not like him. Does Dilbert have grounds for a claim of wrongful discharge for this termination? 1.) No, Dilbert has no grounds for a claim of wrongful discharge because no contract of employment is enforceable unless it is in writing. 2.) No, Dilbert has no grounds for a claim of wrongful discharge because an at will employee can be fired for any reason, and no exceptions apply. 3.) Yes, Dilbert has grounds for a claim of wrongful discharge because the termination was in violation of the public policy exception to at-will employment 4.) Yes, Dilbert has grounds for a claim of wrongful discharge because the company violated an implied employment contract created by the president's repeated statements.

Yes, Dilbert has grounds for a claim of wrongful discharge because the company violated an implied employment contract created by the president's repeated claims.

Martine is asked by her employer to falsify documents that are required by law to be submitted to the Nevada Department of Transportation. She refuses, and is fired for her refusal. Does Martine have grounds for a claim of wrongful discharge? 1.) Yes, under covenant of good faith and fair dealing exception to employment at will. 2.) Yes, under the public policy exception to employment at will 3.) Yes, under implied contract exception to employment at will 4.) No, because she was insubordinate 5.) No, there is no recognized basis upon which she might challenge her discharge.

Yes, under the public policy exception to employment at will.

Under the Bankruptcy Code, any transfer of value out of the estate of the debtor within ninety days of the filing of the petition is a(n): 1.) Contemporaneous exchange for value 2.) Preferential transfer 3.) Fraudulent transfer 4.) Exempt payment 5.) Pledge

preferential transfer