Business Law Test 4

Which of the following statues requires that commercial email not have deceptive headings and clearly indicate if the email is an advertisement?

CAN-SPAM

Andy's business is not able to pay its debts, and the prospects for its finances to improve are slim. Andy decides not to continue the business. In this case, Andy should file a voluntary petition for which type of bankruptcy?

Chapter 7.

Which of the following is NOT a provision of the Clean Air Act?

Consolidation of environmental regulation under one agency

Don received in the mail merchandise he never ordered. The package was addressed to him, and when he opened it he saw a brochure stating he could keep the products for only $19.95. If he chose not to keep the products he was instructed to mail them back within five days. Which of the following is correct?

Don can keep and use the merchandise without having to pay for it.

Under the Endangered Species Act, what federal agency in the Department of the Interior is responsible for preparing a list of species that are in danger of becoming extinct?

Fish and Wildlife Service

Sherry, a 12-year-old, visited a website that wanted to know her family size, her parents' educational level, and her weekly allowance. The site also asked Sherry's name, mailing and e-mail addresses, and age.

Under COPPA, the website must disclose how it will use the information it acquires from Sherry.

Mark signs a periodic tenancy lease at the River's Edge Warehouse for one year. After the year expires, Mark stays in the warehouse and the landlord acquiesces. Mark

has another one-year lease.

Under what circumstances is intrusion into someone's private life a tort?

if a reasonable person would find it offensive

Under the TILA, a qualified mortgage (QM)

limits all of a borrower's debt to 43 percent of his or her income.

What is spam?

unsolicited commercial email

Millie ordered clothes from a mail order catalog. No time was specified as to when the goods would be shipped. In such a case the FTC requires that the company must ship the goods to Millie

within 30 days after receipt of the order.

Under the federal Bankruptcy Code, the exemption amount for the debtor's personal residence is

$22,975.

The Children's Online Privacy Protection Act prohibits Internet operators from collecting information from children under what age without parental permission?

13

If a consumer cancels a door-to-door sale within the required time, how many days does the seller have to return the buyer's money?

3

The Fair Debt Collection Practices Act prohibits which of the following practices?

A debt collector falsely representing himself as a lawyer

Which of the following statements concerning a Chapter 11 reorganization plan is true?

A reorganization plan can be confirmed by the court over objections of some creditors if the court determines that the plan is feasible and fair.

Grand Lighting Co. has filed a petition for voluntary bankruptcy under Chapter 7 of the Code. Which of the following will prohibit creditors from collecting debts that Grand Lighting incurred before the petition was filed?

An automatic stay

What prevents the market system from achieving a clean environment on its own?

Externalities.

Mark and Cynthia work for Bryson Supply Co. If the company files for Chapter 7 bankruptcy before paying their last month of wages and benefits, will they be able to recover anything from the company? Why or Why not?

If Bryson Supply Co. files for Chapter 7 bankruptcy before paying their last month of wages and benefits, Mark and Cynthia, who work for the company, will be able to recover something from the company. The Bankruptcy Code ensures that creditors are paid correctly. The code developed three classes of bankruptcy and those are secured claims, priority claims, and unsecured claims. In this case, Mark and Cynthia's case would fall under the class of priority claims, therefore they are entitled to payments of employees for back wages and benefits for work performed during the 180 days prior to the filing of bankruptcy. This will only be true if alimony, child support and administrative expenses are paid in full first. If Bryson Supply Co. has enough funds to pay all the secured claims and then has money for priority claims, Mark and Cynthia will be able to recover something for their work performed and pension, health, or life insurance plans for work performed during the 180 days prior to the date of Bryson's petition.

Mabel is a single 40-year-old who has borrowed money on numerous occasions. Her payment record has been good, except she has been delinquent in paying a few bills. Which of the following is true regarding credit information gathered on Mabel?

Mabel has a right to have the information regarding her delinquency in paying a few loans stricken from her credit record because her record has generally been good.

Which of the following is NOT a core principle of the Fair Information Practices (FIPS)?

Privacy/Refusal

Sam, the chief executive officer of Boch Industries, was prosecuted for violating the Resource Conservation and Recovery Act. Which of the following is correct concerning the penalties?

Sam faces criminal fines as well as imprisonment.

Which of the following regulates deceptive practices regarding a company's privacy policy?

Section 5 of the FTC Act

Musical Productions has a privacy policy posted on its website but it does not follow the provisions contained within it. Musical Productions is in violation of

Section 5 of the FTC Act.

Which of the following types of concurrent ownership does not provide for rights of survivorship?

Tenancy in common.

Which agency establishes rules for treating both hazardous and nonhazardous forms of solid waste?

The Resource Conversation and Recovery Act

Who operates the business and develops a plan of reorganization in Chapter 11 bankruptcies?

The debtor in possession

Which of the following is a requirement for an involuntary Chapter 7 bankruptcy petition?

The debtor must have at least three creditors sign the petition if the debtor has 12 or more creditors.

Jeff leases an apartment in the expensive, but crime-ridden, area of Isla Vista. While Jeff was in class his apartment was broken into and his television, stereo and watch are stolen. The thief entered through a window which was closed but has a broken lock. A number of the windows in the apartment complex do not lock properly. Total loss is about $2500. Discuss the factors a court will consider when deciding the issue of whether Jeff's landlord is liable for this criminal attack. Based on the facts, how should a court decide.

The factors in which a court will consider when dealing with the issue of whether Jeff's landlord is liable for this criminal attack or not are: the nature of the crime, the reasonable person standard, foreseeability, and prevalence of crime in the area. Due to the fact that Isla Vista is a nice area, but has a high crime rate the landlord should have been able to foresee that an apartment with a number of windows that do not lock properly is a major risk for theft and liability. Any reasonable landlord would have taken the effort to fix the locks, especially in this area, therefore the court will most likely side in favor Jeff, the tenant, and ask the landlord to pay compensatory damages (most likely at least the $2500 in direct damages).

Sandra and Joe own a farm property as tenants in common. They also own a vacation home as joint tenants. What is the difference between the tenancy in common and joint tenancy?

The major difference between tenancy in common and joint tenancy is that joint tenancy has rights of survivorship, which means one of the co-owners dies, the deceased's interest passes to the surviving joint tenant. Under tenancy in common, the deceased co-tenant's interest passes to their beneficiaries, which would be named in their will. In addition, a tenant in common can express his interest at any point during ownership. However, in joint tenancy, an expression by one of the joint tenants will destroy the rights of survivorship and create a tenancy in common.

Which of the following statements regarding the Foreign Intelligence Surveillance Act (FISA) is true?

To spy on people located in the United States who are communicating abroad, the government must obtain permission from a secret Foreign Intelligence Surveillance Court.

Trent was the production manager at HGB, Inc. Under his supervision, HGB filled in an area of wetlands on the company's property without a permit. Has Trent violated the law? What penalties might he face?

Trent, as the production manager at HGB, Inc., filled in an area of wetlands on the company's property without a permit and has violated the law. Trent may be tried criminally, and may have to serve prison time since he knowingly violated the law. Wetlands play a vital role in the aquatic world; they are natural habitats for many wildlife species, and serve as a filter fir neighboring bodies of water, trapping chemicals and sediments. They are essential to flood control since they absorb large amounts of water and release it slowly. The CWA, Clean Water Act, prohibits any discharge of dredge and fill material into wetlands without a permit. Due to the fact that Trent violated the CWA, he may face criminal fines issued by the court and possibly even jail time.

Brooke uses her credit card to purchase a lawn mower at the local "big box" hardware store, but when she tries to use the mower for the first time, she finds it is not self-propelled as advertised. Does she have any recourse with the credit card company? If so, what is it?

Under the TILA, Truth in Lending Act, Brooke is protected because she used her credit card for the purchase. Between a merchant and a customer, if there is a dispute, the credit card company can't bill the customer (in this case Brooke) as long as the customer makes good faith effort to resolve the dispute at hand. Especially because the dispute in this case is over $50 dollars and the merchant and the customer are in the same state/within 100 miles of the customer's place of residence.

Daniel went onto an Internet message board and found that his ex-wife, Faye, had posted a message calling him a fat, insensitive jerk who only cared about watching sports on TV. Does Daniel have any protection against Faye's making such statements to a potentially large number of readers, some of whom may know Daniel and some of whom may not?

Under the first amendment, Faye's postings are protected due to the protection of free speech, as long as she refrains from defamation of any sort. Due to court rulings, which often find these statements to be opinion, they are protected. The idea that a statement maybe offensive to someone is not enough reason to take it down or suppress the opinion.

Which of the following is a heat source of water pollution?

Water that has been used as a coolant in a factory and returned to the waterways

A landlord's substantial interference with a tenant's use of the property is considered

a constructive eviction

The CAN-SPAM Act

applies to virtually all promotional e-mails, whether or not the sender has a pre-existing relationship with the recipient.

The practice of inferring needs and preferences from a consumer's online behavior and then targeting related advertisements to them is referred to as

behavioral marketing.

Chapter 13 bankruptcy

can be used only by individuals with a regular source of income

Agnes plans to file for bankruptcy under Chapter 7. One month prior to filing, Agnes gives Joe's Filling Station $700 to apply to her gas bill. Joe has been so kind to let her charge the gas she needed for her car over the past year. The bankruptcy trustee appointed to the case

can cancel the payment to Joe as a voidable preference.

Unsolicited commercial e-mail (UCE) or unsolicited bulk e-mail (UBE) messages

constitute about 90 percent of all e-mail.

Iris received a discharge under a Chapter 7 bankruptcy. She cannot receive another discharge under Chapter 7 for at least

eight years after the prior filing.

Debts that cannot be discharged in bankruptcy include all EXCEPT

money owed to utility companies.

The right of the tenant to the undisturbed possession of the leased property is known as

quiet enjoyment

A Chapter 7 debtor's agreement to pay a creditor on a debt after receiving a discharge in bankruptcy is called a

reaffirmation

The correct order of payment of claims from the debtor's estate would be

secured claims, priority claims, unsecured claims.

The maximum rate of interest for credit transactions is established by

state law.

Chapter 7 bankruptcy is also known as

straight bankruptcy

A tenancy with no fixed duration is a

tenancy at will.

MoneyMaker Toy Company violated the safety standards set forth by the Consumer Product Safety Commission when it produced a toy gun that caused injury to hundreds of children. Because of MoneyMaker's actions

the CPSC can impose civil penalties on the company. the CPSC can impose criminal penalties on the company. users can sue for damages, including attorney's fees, if MoneyMaker knew it was violating a consumer product safety rule when it produced the guns.

Under the Truth In Lending Act, a lender must disclose all of the following EXCEPT

the average percentage rate charged by competitors.

The start of the bankruptcy process is

the bankruptcy court's issuance of an order for relief

The public disclosure tort requires the plaintiff to show all of the following EXCEPT

the disclosed facts were a legitimate concern to the public.

Marla applies for and receives a three-year loan through Sharkey Lenders for $5,000 at 27% APR.If the loan agreement violates the applicable usury statute, Marla may be able to keep

the interest that exceeds the usury limit. all of the interest on the loan. the interest and the $5,000. Any of the answer choices are possible, depending on where the loan was made.

What is net neutrality?

the principle that all information which flows on the Internet must receive equal treatment.

A tenant's foremost obligation is

to pay rent.