Business Law Chapters 10-12,19, & 43

A(n) _____ is most commonly used when a grantor, for some reason, does not want to know exactly what is in the trust, but wants to retain the benfit of the property.

blind trust

A(n) _____ is one that the seller did not make but is imposed by the law.

implied warranty

Which of the following is an example of a contract contrary to public policy?

A agrees to appoint B as sheriff, provided he helps him win local elections

Which of the following is an example of a contract discharged by impossibility of performance?

A new law makes the contract illegal

Which of the following best describes a legatee?

A person receiving a gift of personal property

Which of the following is true of the parol evidence rule?

It allows written contract to be modified by oral testamony if there is evidence of fraud

Which of the following statements best describes a several conractt?

It is a contract where two or more people individually agree to perform an obligation

WHich of the following is an advantage of a written contract over an oral one?

The existence of a contract cannot be denied if it is in writing

Which of following constitutes an exception to the Statute of Frauds requirement that. contract be in writing?

The promise to pay one's own debt, rather than a promise to pay the debt or another

A(n) _____ occurs when a testator makes bequests of money in the will and the estate does not have enough money to pay all the bequests so they are paid proportionally.

abatement

A contract must be for a lawful purpose, which must be achieved in a lawful manner, otherwise the contract is:

void

Which of the following warranties applies to all sellers?

warranty of title

Who may elect to take a share of decedent's estate regardless of the terms of the will?

A surviving spouse

Which of the following is true of contracts that limit the freedom of marriage?

An agreement not to marry during minority is validn

AB Developers signs a contract with CL Corp., agreeing to build a $20 million office for the corporation. The construction contract was substantially performed. There were, however, a few minor breaches of the contract by AB Developers that made CL Corp. incur damages worth $10,000. Which of the following is most likely to be true in this scenario?

CL Corp. needs to pay the full price under the contract less the damages suffered by it

The _____ requires creditors to notify a potential recipent of credit whenever any adverse action or denial of credit was based on a credit report.

Fair Credit Reporting Act

Which of the following statements is true of statutes of limitations?

In the case of running accounts, such as purchases from the department stores, the statute starts from the date of purchase

Which of the following best describes a probate?

It is a court procedure that determines the validity of a will and distrubution of estate

What is the Statute of Frauds?

It is a law requiring certain contracts to be put in writing

Which of the following statements best describes the term "assignment"?

It is the conveyance of rights in a contract to a person who is not a party

Which of the following statments best describes specfic performance?

It refers to the carrying out of the specific terms of a contract

Jack, a second-hand dealer of cars, provides his clients with the opportunity to examine them. Jenny test-drove a car and got it checked by her mechanic as well. However, the mechanic missed a broken valve and the car broke down after the purchase. Which of the following is likely to happen in this scenario?

Jack is exempt from prosecution as the principle caveat emptor applies

Ownership of property in trust can be described as a division at the same time of what two ownership interests?

Legal and beneficial

When a contract contains the words "time is of the essence," which of the following is true?

Performance on the exact date is deemed vital

Which of the following warranties does an assignor make when he assigns rights under a contract to an assignee for value?

That there are no defenses available to the debtor that have not been diclosed to the assignee

A contract not to compete is valid in which of the following instances?

The buyer of a businesss prohibiting the seller from engaging in the same business in a certain town

Which of the following is true of sale of food or drink?

The sale carries an implied warranty that the food is fit for consumption

Which of the following is truw of Sunday contracts?

Their laws are a result of statutes

In which of the following situtations is a state most likely to enforce a usury law?

X charges a very high rate of interest on money borrowed by Y

A seller's warranty that the goods shall be delivered free from any security interest or any other lien of which the buyer at the time of making the sales contract had no knowledge is known as a _____.

a warranty against encumrances

A force majeure clause in a contract is a contract provision that excuses performance by a party when:

an extraordinary event outside the party's control occurs

In a written contract, Sheldon agrees to tutor the children of Mrs. Smith for a cerain period of time. However, Sheldon, prior to starting classes, announced that he would not be able to tutor the children due to other commitments of his. In this case, there has been a(n)

anticipatory breach

If a contract is divisible so that legal parts can be performed separately from the illegal parts, then the legal parts of contract are:

enforceable

The statement of the seller in which the article sold is warranted or guaranteed is known as an _____.

express warranty

_____ wills are written entirely in longhand by the testator.

holographic

Blake agreed to renovate Jane's house, and they drafted a written contract. However, Blake was unable to complete the renovation due to an accident. Blake's friend, Tom, agreed to complete the job, and Jane agreed to release Blake from the contract. The terms of the old contract remained the same. This process of substitution of contract is known as a(n):

novation

Parol evidence refers to:

spoken words

An offer to pay money in satisfaction of a debt or claim when one has the ability to pay is a :

tender payment

The legal rate of interest is a rate:

that is applied when no rate is specfied

When a party sues to enforce an alleged contract that falls under the Statute of Frauds, the law requires that:

there be a note in writing signed by the party against whom the claim for breach of contract is made

An donee beneficiary is best described as a person:

who is a third-party beneficiary and for whom performance is a gift

A(n) _____ is an instrument prepared in the form prescribed by law that provides for the disposition form of a person's porperty and takes effect after death.

will

Which of the following is true of a warranty of merchantability?

Warranty of merchantability relates only to the fitness of the product made or sold

Default refers to:

a breach of any contractual obligation

A joint contract is one in which:

each obligor is bound for the performance of the entire obligation

A person not party to contract but whom parties intended to benfit is known as a(n):

third-party beneficiary

Which of the following types of agreements according to the Statute of Frauds need to be in writing?

An agreement containing a promise in consideration of marriage

_____ is information that law presumes everyone knows by virtue of the fact that it is filed or recorded on the public record.

Constructive notice

When an assignment is made by acts of the parties, which of the following is true?

If the original contract was required be in writing, the assignment must also be in writing

In which of the following cases will a court refuse to enforce the provision of liquated damages on a party?

When the amount of liquidated damages fixed by the contract is unreasonable