LAW MID
Why would a businessperson use contractual terms as a planning feature of the law? 1) to limit liability and block the use of the parole evidence rule 2) to limit liability and shield against possible future events 3) to limit liability and prevent collateral oral agreements 4) to limit liability and buffer against certain future events
2
A batch of food packaging was incorrectly labeled sulphate-free when sulphate was a standard ingredient. Which functional area of the business would be considered responsible for this error? Question options: 1) labeling 2) production 3) marketing 4) human resources
3
In which of the following circumstances would a risk manager be most likely to consider risk avoidance? 1) where the risk associated with an activity is easily absorbed 2) where the risk associated with an activity is minimal 3) where the undesirable result of an activity is greater than its advantages 4) where the undesirable result of an activity is less than its advantages
3
Which of the following is a required element in the procedure for passing federal legislation through Parliament? 1) a majority vote by Commons committee and approval by Senate 2) a quorum vote in the House of Commons and by the Senate 3) a majority vote of the members in the House of Commons and in the Senate 4) an approval by the House of Commons and by the Senate committee
3
Which of the following is the term "in-house lawyer" used to describe? 1) a lawyer working from home 2) a lawyer specializing in home sales 3) a lawyer working inside the business 4) a lawyer working in a law firm
3
Which of the following statements is correct regarding the duty of the plaintiff to mitigate his or her damages? 1) The duty to mitigate is no longer part of the law of Canada. 2) The plaintiff is relieved of the duty to mitigate if the case involves a breach of a major term of the contract. 3) Everyone who suffers a breach of contract has a duty to mitigate. 4) A party will be relieved from the duty to mitigate if it will require a cash outlay.
3
Which two approaches are recommended for businesses to effectively manage their interaction with the law and legal issues? Question options: 1) precautionary and reactionary 2) risk aversive and risk detractive 3) preventive and reactive 4) managerial and risk detention
3
Who holds the office of chief executive of the federal government? 1) the appointed governor general 2) Elizabeth II, as reigning Queen of England 3) the duly elected prime minister of Canada 4) the appointed chief senatorial officer
3
Why does one assess the severity of potential losses when creating a legal risk management plan? 1) to establish insurance policies for employees exposed to greater risk 2) to delegate responsibility for devising the risk management plan 3) to prioritize identified risks and guide a given risk through the process 4) to identify mechanisms to adopt, avoid, or eliminate existing risks
3
What type of law is the vehicle for ensuring that those affected by a failed business are treated fairly, reasonably, and in accordance with agreed rules? Question 4 options: 1) bankruptcy law 2) contract law 3) criminal law 4) corporate law
1
Which legislative body in Canada is composed of the House of Commons and the Senate? 1) the Parliament of Canada 2) the House of Assembly 3) the Supreme Court of Canada 4) the Legislative Assembly
1
Which of the following are usually classified as functional areas of a business? 1) production, human resources, finance, information systems 2) finance, accounting, training, legal 3) marketing, education systems, finance, business decisions 4) accounting, marketing, training, transactions
1
Which of the following best describes how law protects members of society? Question 39 options: 1) setting rules with penalties and making those who break the law accountable 2) establishing ethical rules and minimizing risks before they materialize 3) constraining business activity and regulating commercial relationships 4) minimizing unknown contingencies to avoid irreconcilable disputes between businesses
1
Which of the following best describes the relationship between bargaining power and the law of contract? 1) The law of contract is not generally concerned with the parties' relative bargaining power. 2) The law of contract seeks to correct inequalities in bargaining power. 3) The law of contract is very concerned with the relative bargaining power of the parties. 4) The goal of the law of contract is to reduce the bargaining power of the parties.
1
Which of the following best exemplifies a protective element of Canadian law? Question 29 options: 1) It seeks to make those who break the law accountable. 2) It sets rules in order to encourage complexity. 3) It sets rules in order to encourage complacence. 4) It provides rules that prohibit making commitments.
1
Which of the following has the greatest influence on creating the flexible relationship that exists between contract law and economic reality? 1) Contractual obligations must be performed or compensation paid for non-performance. 2) Courts assess the fairness of the contract terms chosen by the parties. 3) A party's need for judicial assistance or judicial intervention must be justified. 4) Parties must be responsible for themselves and work to maximize self-interest.
1
Why is the inclusion of a limitation of liability clause in a commercial contract considered to be an effective solution for business legal risk management? Question options: 1) It removes the liability from a standard form commercial contracts 2) It creates equity because it imposes the same terms on every customer 3) It limits financial responsibility for damages if there is a breach of contract 4) It transfers risk from the business owners to the customers
3
A business finds that employees are involved in many road accidents. To lower its premiums, the business decides to raise its insurance deductible to $1,500 per vehicle. Which approach to risk management does this plan reflect? Question options: 1) risk avoidance 2) risk reduction 3) risk transference 4) risk retention
4
Which of the following is a distinguishing feature of a "condition" in a contract? 1) It is a minor term that, if breached, gives the innocent party the right to sue for damages. 2) It is a term in a contract that cannot be easily classified as major or minor. 3) It is a term in a contract that, if breached, will entitle the innocent party to the remedy of specific performance. 4) It is a major term that, if breached, gives the innocent party the right to terminate the contract and sue for damages.
4
Which of the following is a good reason to use a contract as opposed to having a casual understanding? 1) Casual understandings require lengthy negotiations and time to perform. 2) All contracts typically involve arrangements that are unlikely to be repeated. 3) Casual understandings are casually conducted and completed instantly. 4) All contracts are subject to the same set of compulsory legal rules and are enforceable in a court of law.
4
Which of the following is an example of an alternative method of dealing with a breach of contract, rather than starting a lawsuit? 1) Treat the subject matter of the contract as a standard or ordinary commodity. 2) Maintain the project's profitability by insisting on full compensation for any loss. 3) Seek sufficient compensation for any resulting loss, but extend the time for payment. 4) Show respect for the other party while seeking a standard of reasonableness in return.
4
Which of the following is an example of risk transference? Question options: 1) insurance policy deductibles 2) self-insurance 3) noninsurance 4) insurance
4
Which of the following is more characteristic of in-house legal counsel than of outside counsel? Question options: 1) traditionally more circumscribed; only called when an event has occurred 2) traditionally plays a reactive rather than a preventative role 3) offers an independence that comes from membership in a professional body 4) increasingly seen as part of the management team
4
Which of the following is the best way to reduce the risk of non-payment associated with extending credit to customers? Question options: 1) Include a limitation of liability clause in all contracts 2) Take out credit insurance 3) Charge accounts receivable losses as expenses 4) Perform regular customer credit checks
4
Which of the following would automatically end a contract with a supplier if the buyer's sales fall below a stated level? 1) an exemption clause 2) a condition precedent 3) a liquidated damages clause 4) a condition subsequent
4
Which of the following would give rise to the ability of one party to terminate a contract and bring an action for damages? 1) breach of an express term of the contract 2) breach of an innominate term of the contract 3) breach of a warranty of the contract 4) breach of a condition of the contract
4
How does Canadian law require businesses to protect their customer's private information? Question 42 options: 1) Businesses are prohibited by federal legislation from collecting information about their customers. 2) Federal legislation prohibits all disclosure of any information about customers. 3) Businesses are required by provincial legislation to destroy all information about customers. 4) Federal and provincial legislation govern the collection, use, and disclosure of personal information.
2
How should a manufacturer try to salvage its reputation after it has been discovered to have knowingly produced and sold a defective product to the public? 1) Deny any wrongdoing and obtain top lawyers to defend against litigation. 2) Take ownership for the problem and voluntarily compensate affected customers. 3) Hire bloggers to create confusion about the facts on social networking websites. 4) Have a top executive issue an official apology and resignation on national television.
2
I'mNottaSoSmart Inc. overlooked the proper registration of its patent for a unique relay component used in its new software before release for public sale. A year later it discovered a competitor had used the component in its just-released patented software. Which of the following best describes the consequences to the competitor for its actions? Question 19 options: 1) Unprotected intellectual property can be used with impunity. 2) Theft of business property is a criminal offence. 3) Patent law infringements are punishable offences. 4) Losses due to theft of business property are recoverable.
2
If there is a high probability that a particular loss-causing event will occur, what should also be considered during the risk evaluation process? 1) which business function will be responsible for the loss 2) the potential severity of the loss 3) which functional area will be responsible for the loss 4) what action should be taken after the loss-causing event
2
What are the basic levels of courts that make up the Canadian court system? 1) trial, informal appeal, and final appeal courts 2) trial, intermediate appeal, and final court of appeal 3) informal trial, formal trial, and final appeal courts 4) pre-trial, trial, and appeal courts
2
What are the standard forms of business structure available to entrepreneurs to facilitate creation of a for-profit business enterprise? Question 27 options: 1) sole owner, proprietor, and partnership 2) sole proprietor, partnership, and corporation 3) sole partnership, proprietor, and corporation 4) sole owner, proprietor, and corporation
2
What form of private law is applied in Quebec courts? 1) the Civic Code of Quebec 2) the Civil Code of Quebec 3) the Quebec Civil Law Code 4) the Civil Law Code
2
What is the definition of "duress" with respect to contractual relationships? 1) inequality between the parties 2) the threat of physical or economic harm that results in a contract 3) unfair manipulation 4) unfair criminal activity that seriously undermines a contract
2
What is the judicial branch of government in Canada composed of? 1) the system of various levels of courts in Canada 2) the judiciary and the system of various levels of courts 3) a judiciary appointed by the governor general 4) the judiciary and federal and provincial prosecutors
2
What is the least likely source of law in Canada? 1) common law 2) public opinion 3) Civil Code 4) royal prerogative
2
What is the legal term given to a provision in a contract whereby the parties agree in advance the amount to be paid in the event of a contract breach? 1) an applied term 2) a liquidated damages clause 3) a punitive clause 4) an exemption clause
2
What is the meaning of the statement "Promissory estoppel may be used as a shield and not as a sword" with respect to the classical application of the common law doctrine of promissory estoppel? 1) The doctrine is unavailable as a defence in a lawsuit. 2) The doctrine can only be used as a defence to legal claims made by the promise-breaker. 3) The doctrine is only available to Captain America. 4) The doctrine is unavailable to a person who has broken a promise.
2
What is the name given to a clause in which the parties agree that their contract is complete as written? 1) parol evidence clause 2) entire contract clause 3) express term 4) exclusion clause
2
What is the overall primary objective of the legal risk management process? Question options: 1) prevention of loss 2) reduction of risk 3) transfer of risk 4) eliminating loss
2
What is the primary benefit of contract law to business? 1) Contract law allows businesses to transfer risk. 2) Once a contract is created, it permits both parties to rely on the terms they have negotiated and plan their business affairs accordingly. 3) Contract law guarantees that others will follow through with their promises. 4) It ensures that businesses treat each other as equals and do not take advantage of one another in business relationships.
2
What is the role of business ethics? Question 1 options: 1) to provide a comprehensive plan for dealing with legal risk 2) to establish principles and values for determining right and wrong in the business world 3) to resolve disputes between conflicting parties 4) to impose legal responsibility for an event or loss that has occurred
2
What is the source of the law that governs lawmaking authority within the Canadian legal system? 1) parliamentary bills 2) constitutional law 3) the Civil Code 4) constitutional conventions
2
What is the term given to the guiding principles for interpreting the terms of a contract? 1) Thompson's Rules 2) The Rules of Construction 3) The Rules of Interpretation 4) The Parol Evidence Rules
2
What legal consequence might a business face were it to advertise an untrue statement of fact about its competitor? Question 41 options: 1) mandatory arbitration 2) a lawsuit for defamation 3) a lawsuit for passing off 4) prosecution under the Criminal Code
2
What level of government possesses the required constitutional jurisdiction to change laws that affect property? 1) federal; paramount jurisdiction 2) provincial; exclusive jurisdiction 3) municipal; concurrent jurisdiction 4) provincial; delegated jurisdiction
2
Where circumstances surrounding a proposed commercial transaction involve an unsophisticated party, what would a court most likely accept as undisputable evidence that that party has proceeded with the transaction on a free and informed basis? 1) a certificate of individuality 2) a certificate of independent legal advice 3) a certificate of indisputable legal autonomy 4) a certificate of understanding
2
Which of the following are competing goals that contract law attempts to balance when enforcing contracts? 1) the goal of providing remedies, and the goal that contractual terms are reasonable 2) the goal of preventing people from avoiding contractual obligations, and the goal of ensuring the contract reflects the real agreement between the parties 3) the endeavour to preserve the real agreement reached by the parties, and the goal of preventing mistakes 4) the goal of ensuring equal power between the parties, and the goal of ensuring contract negotiations are successful
2
Which of the following best defines business law? Question 33 options: 1) legal responsibility for the occurrence of an event causing loss 2) rules governing commercial relationships and the enforcement of rights 3) rules governing procedures involved when one person sues another 4) rules providing members of a society with established rights
2
Which of the following elements would a court consider when determining the enforceability of a non-competition clause on the grounds of reasonableness? 1) contravention of the Real Estate and Business Brokers Act 2) the reasonableness of location and time restrictions 3) contravention of anti-price maintenance legislation 4) the need to maintain free and open competition
2
Which of the following is a distinguishing characteristic of a "condition precedent"? 1) It prevents a contract from coming into existence if a particular condition is not met. 2) It relieves a party from performing a contract if a particular condition is not met. 3) It is a term that, if breached, entitles the other party to cancel the contract. 4) It permits a party to limit liability for damages.
2
Which of the following is a distinguishing feature of all contracts that are void due to illegality? 1) They contain restrictive covenants. 2) They are contrary to statute law and/or violate public policy. 3) They are unconscionable. 4) They are contrary to the Criminal Code.
2
Which of the following is a distinguishing feature of force majeure clauses? 1) They are rarely enforced by the courts. 2) They allow parties to decide whether a particular event amounts to frustration. 3) They can be used to force parties to mitigate their damages. 4) They ensure parties are liable in the event of frustration.
2
Which of the following is an example of a provincially appointed administrative body? Question 5 options: 1) the Radio-television and Telecommunications Commission (CRTC) 2) the Securities Commission 3) the Food and Drug Agency 4) the Atomic Energy Commission
2
Which of the following might prove that a contract was freely entered into by the parties? 1) evidence the contract was signed in the presence of a witness 2) evidence the weaker party received independent legal advice 3) evidence there has only been presumed pressure but not actual pressure 4) evidence that the terms of the contracts are fair
2
Which of the following outcomes is dictated by the doctrine of paramountcy in circumstances where conflicting federal and provincial laws cannot be reconciled? Question 16 options: 1) The federal law prevails, except in Quebec. 2) The superior law prevails. 3) Concurrent provincial law prevails. 4) The provincial law prevails.
2
Which of the following statements accurately reflects the principles of the doctrine of unconscionability? 1) It is based on the assumption that the parties to a contract should have equal bargaining power. 2) Proof of unconscionability involves proof of inequality between the parties AND proof of an improvident bargain or exploitation. 3) The court will only intervene if there is evidence of mental incapacity of one of the parties. 4) The doctrine of unconscionability imposes a positive duty to disclose information.
2
Which of the following statements regarding contract terms is correct? 1) Contract terms are an aid for a court to interpret a business arrangement. 2) Contract terms may be express or implied. 3) Contract terms must be in writing to be effective. 4) Contract terms must be reasonable.
2
Which one of the following should be assigned the highest priority when measuring legal risk? Question options: 1) a low-probability event that could result in a relatively small loss 2) a high-probability event that could result in a relatively high loss 3) a low-probability event that could result in a relatively high loss 4) a high-probability event that could result in a relatively small loss
2
Why do the courts subject restrictive covenants in the employment context to greater scrutiny than those arising in the sale of a business? 1) because the clauses are typically ambiguous 2) because there is typically a power imbalance in employment situations 3) because such agreements offend human rights legislation 4) because such clauses violate the Competition Act
2
Why should companies expend substantial effort when seeking a commercial law firm to handle its legal services? 1) to reduce stress level put on in-house counsel 2) to establish a productive, long-term relationship 3) to allow the risk to remain outside the business 4) to delegate risk management to outside source
2
A browse-wrap licence instructs the user to review the terms prior to assenting by clicking an "I accept" icon, and the user typically cannot proceed any further without agreeing to the licence terms. 1) True 2) False
f
Consideration must always flow from one party in a contract to the other party. 1) True 2) False
f
In every type of business dispute resolution, Canadian law requires that a judge must decide the amount of the loss to prevent hard feelings between the parties and allow the business relationship to be maintained. Question 17 options: 1) True 2) False
f
Litigation is usually the most cost-effective method for resolving legal disputes. Question 10 options: 1) True 2) False
f
Once made, an offer cannot be revoked. 1) True 2) False
f
The courts will not imply a duty to act in good faith in commercial contracts. 1) True 2) False
f
The creation of complexity in business relationships is one of the most important contributions the law can make to the commercial arena. Question 5 options: 1) True 2) False
f
The mediation process is only available in limited circumstances and is usually more time-consuming and costly than litigation. Question 2 options: 1) True 2) False
f
A business that neglects to protect its intellectual property may have its ideas taken with impunity by a competitor. Question 12 options: 1) True 2) False
t
A contract provides the legal backdrop to commercial relationships by defining the rights and obligations of the parties, but it is the business relationship itself that will determine whether, in a conflict, the parties will insist upon strict enforcement of their legal rights. Question 7 options: 1) True 2) False
t
A tanning salon that permits underage tanning may face prosecution under provincial legislation. Question 8 options: 1) True 2) False
t
An implied term may be imposed by the court in order to give effect to the parties' intentions. 1) True 2) False
t
Canada offers an attractive commercial environment for entrepreneurs because it has an established set of laws comprised of rules and principles intended to guide conduct in business relationships and protect the property of persons and business. Question 23 options: 1) True 2) False
t
Contract law refers to a collection of rules used to establish contracts as binding agreements between contracting parties and to ensure their obligations can be legally enforced. Question 25 options: 1) True 2) False
t
Litigation is an expensive and lengthy process that involves one business entity attempting to find a resolution for a conflict caused by the other party to the contract by actively engaging in negotiations aided by a neutral party. Question 43 options: 1) True 2) False
t
Novation of a contract will result in the termination of the original contract. 1) True 2) False
t
Parties that agree to submit disputes to a neutral party who will ultimately make a binding decision to resolve the dispute are agreeing to participate in the arbitration process. Question 28 options: 1) True 2) False
t
The parol evidence rule limits the evidence a party can introduce concerning the contents of a contract. 1) True 2) False
t
Which of the following would most likely have the greatest influence in orchestrating the occurrence of an economic breach in a contractual business relationship? 1) seeking methods of maintaining profits when entering into new business relationships 2) taking an intractable position and forcing an ultimate favourable settlement 3) finding practical ways of interpreting contracts to arrive at higher profit margins 4) deciding to secure greater profits through non-performance of an existing contract
4
Why is it important for the parties involved in contractual negotiations to know that an offer has been rejected? 1) The risk in rejecting an offer is that it may not be renewed. 2) A counteroffer is legally recognized as a form of acceptance. 3) The distinction between rejection and acceptance can be unclear. 4) The offer is automatically terminated upon rejection by the offeree.
4
What category of actionable misrepresentation restricts the innocent party to the common law remedy of rescission of the contract? 1) innocent misrepresentation 2) negligent misrepresentation 3) fraudulent misrepresentation 4) material misrepresentation
1
What characteristic distinguishes Quebec's civil law from Canada's common law? 1) Civil law courts are not bound by earlier interpretations of the Code. 2) Civil law courts hear only matters of public law disputes. 3) Civil law judges are provincially elected for one five-year term. 4) Civil law courts do not have to consider legislation.
1
What is the meant by the statement that an offer "has lapsed"? 1) that the time for acceptance by the offeror has passed 2) that the offer must be available for acceptance 3) that the offeror has lost the capacity to fulfill the contract 4) that the rejection of the offer has occurred
1
Jim has retained a lawyer to file a lawsuit claiming economic loss due to theft of business revenues by his partner. What form of dispute resolution has Jim undertaken? Question 24 options: 1) arbitration 2) mediation 3) litigation 4) reconciliation
1
Leslie offered to pay Murray $100 a day to show her dog in an upcoming three-day competition. Murray accepted and showed the young male dog, winning best of breed during each day's competition. Leslie paid Murray $300. What is the present status of their contractual arrangement? 1) The contract has been terminated by performance. 2) The termination of the competition frustrated the contract. 3) The payment of the settlement ended the contract. 4) The contract terminated by agreement of the parties.
1
What law regulates the use of tanning beds in Nova Scotia? Question 11 options: 1) the Tanning Beds Act 2) the Consumer Protection Act 3) the Criminal Code of Canada 4) the Constitution of the World Health Organization
1
What type of clause will a court simply disregard in assessing damages for a breach of contract if it sets an exorbitant amount as a remedy for the innocent party? 1) Penalty Clause 2) Liquidated Damages Clause 3) Limitation of Liability Clause 4) Exemption Clause
1
Marty has made his acceptance of an offer to purchase his house subject to his lawyer's approval. Why did Marty's lawyer advise him that it was essential for him to do so? 1) to ensure contractual obligations Marty incurs are limited to certain circumstances 2) to ensure that buyer is serious about the purchase offer 3) to ensure that Marty will receive a fair price without losing the sale altogether 4) to avoid having to negotiate a higher price to compensate for market changes
1
Nathan is the owner of a small drapery manufacturing business. He has a written contract with a fabric supplier, but some aspects of their agreement were never put into the written document. Why will Nathan have difficulty enforcing the verbal aspects of their agreement? 1) because the parol evidence rule forbids outside evidence as to the terms of the contract when the written contract is clear 2) because verbal promises cannot form the basis of contractual obligations 3) because the contra proferentum rule will result in a court rejecting the verbal terms of the agreement 4) because the court cannot imply terms into a contract
1
One of the goals of Canadian law is to ensure that losses are paid for by the parties responsible for creating them. Question 30 options: 1) True 2) False
1
Organic Veggies'4'U Inc. has entered into a one-year, extendable supplier contract with EcoWise Fertilizers Ltd. for the delivery of 1.5-ton pallets of worm castings fertilizer at a price of $2,000 per ton in March and June. What type of role do contract law and its contributions to the establishment of this business relationship have? Question 15 options: 1) a facilitating role, providing definition, context, and certainty 2) an ethical role, facilitating better environmental practices 3) a litigation role, defining clear areas of liability for breach 4) a governing role, providing a comprehensive action plan
1
Rules of equity focus on what would be fair given the specific circumstances of the case, as opposed to which of the following? Question 4 options: 1) what the strict rules of common law might dictate 2) law that governs relations between states 3) the internal set of laws of a given country 4) law governing agreements between states
1
The decisions of the Supreme Court of Canada are best described as: 1) binding on all other courts in all Canadian jurisdictions 2) limited to constitutional matters 3) binding only on the government 4) always appeals from the Federal Court of Canada
1
To succeed in its action for breach of contract, the plaintiff is obligated to demonstrate which of the following elements on the balance of probabilities? Privity, breach and entitlement to remedy Duty to mitigate and specific performance Improper behaviour by the plaintiff Server hardship and restitution quantum meruit
1
What are four approaches to managing legal risk? Question options: 1) avoid, reduce, transfer, and absorb 2) divert, decrease, transfer, and align 3) avert, tolerate, lessen, and lose 4) reduce, shift, diversify, and amalgamate
1
What are the commonly used alternative dispute resolution methods for avoiding litigation? Question 16 options: 1) intervention, negotiation, and reconciliation 2) intervention, arbitration, and mediation 3) negotiation, mediation, and adjudication 4) direct negotiation, mediation, and arbitration
1
What attribute distinguishes substantive law from other forms of law? 1) It defines rights, duties, and liabilities. 2) It defines international legal status. 3) It defines the relationship between governments. 4) It defines procedures under the Charter.
1
A province wants to challenge an appeal court's decision regarding the prevention of continued ground water contamination now posing a significant health risk to people, wildlife, and plants living in the ecosystem to the Supreme Court. Which of the following would immediately signify the Supreme Court's agreement to hear the challenge, and why it would consider this appeal? Question 13 options: 1) leave to appeal; significant or national concern 2) consent to appeal; provincial challenges 3) consent to appeal; jurisdiction 4) permission to appeal; national public concern
1
A senior partner delegated the drafting and filing of a statement of claim to a first-year lawyer employed by the firm. The first-year lawyer erroneously sued the wrong parties. How will the law assign responsibility for the obligation with regard to the quality of the work performed? 1) The employer will be held responsible in law for the incompetent performance. 2) Both parties will be jointly held responsible for their combined incompetence. 3) The law will hold each party proportionately responsible for the incompetence. 4) The employee will be held responsible in law for the incompetent performance.
1
A small group of entrepreneurs undertaking a business venture have agreed on the roles each will assume in the business, but they must now determine the form of business structure for the enterprise. What does the law facilitate by offering entrepreneurs different business structure options? Question 35 options: 1) choice of degree of exposure to liability for business risks 2) rules that make written agreements between parties binding 3) opportunities to maximize the protections that the law extends 4) legal certainty for activities conducted in the commercial arena
1
ABC Electrical Inc. has a contract with a building contractor that provides that in the event of breach, ABC will be entitled to damages of $10,000. Which of the following best describes this type of contract term? 1) a liquidated damages clause 2) a condition precedent 3) an exemption clause 4) a limitation of liability clause
1
Avatar Productions Ltd. has had a long and successful relationship with Facades Inc., a set designing company. Recently, Facades failed to complete one of its contractual obligations within the time limit set out in the contract. What overriding factor should Avatar consider when deciding whether to sue Facades? 1) whether it makes business sense to sue Facades 2) that failure to immediately sue Facades will result in giving up its right to sue 3) the cost of legal counsel 4) whether it can prove that the breach was due to negligence on the part of Facades
1
Canadian environmental activists are sometimes charged with offences for actions taken during their protests. Which of the following might constitute a basis for activists to challenge convictions arising out of their protest activities? 1) the Charter rights of freedom of peaceful assembly and freedom of association 2) the doctrine of paramountcy 3) the common law right to freedom of expression 4) the notwithstanding clause
1
Champion Well Drilling Inc. is being sued for rupturing a gas line while drilling a well on a customer's property. How might Champion best avoid similar risks in the future? Question 36 options: 1) by developing and implementing a legal risk management plan 2) by limiting itself to zero-risk projects 3) by ensuring it has sufficient resources set aside to pay out future judgments 4) by hiring a mediator to assist in resolving future legal disputes
1
Compliance with legal requirements and anticipation of changes in the legal environment are distinguishing characteristics of which approach to managing interaction with the law and legal issues? Question options: 1) preventative 2) anticipatory 3) precautionary 4) reactionary
1
Evergreen Solutions Inc. intends to sell its database of customer contact information to a telemarketing firm. What infraction might Evergreen Solutions Inc. be committing if it proceeds with this plan? Question 20 options: 1) privacy breach 2) Criminal Code conflict 3) conflict of interest 4) financially profitable
1
How can a legal risk management plan be an effective tool for a business experiencing a security breach of customer data? Question options: 1) it can provide a defined process for staff to follow 2) it can transfer the risk from sales to human resources 3) it can help in tracking down those responsible 4) it can be used in a court of law to force hackers to return the data
1
How does misrepresentation differ from a breach of contract? 1) Misrepresentation refers to statements made prior to entering into a contract. 2) Misrepresentation must be intentional in order to be actionable. 3) Misrepresentation only applies if the parties are in a relationship of utmost good faith. 4) Proof of misrepresentation alone is insufficient for the courts to rescind a contract.
1
In determining a constitutional challenge, the Supreme Court of Canada upheld the federal government's bilingual language rights legislation. Which of the following exemplifies the reason for the Court's decision? 1) The Supreme Court's decision follows the doctrine of paramountcy. 2) The Court's decision does not apply in the province of Quebec. 3) Regulating language law falls within federal government jurisdiction. 4) The Supreme Court's decisions must uphold the public interest.
1
In which of the following situations might a court be inclined to grant an injunction? 1) where the contract contains a promise not to engage in specified activities 2) where the plaintiff does not have "clean hands" 3) where the plaintiff is undeserving of damages 4) where the court wishes to force a party to complete their performance of the contract
1
Jedco Wholesalers Ltd. and BigGrocer Inc. have agreed that Jedco will supply BigGrocer with 400 kilos of watermelon when the crop is harvested. Rather than agree on a set price, they have agreed that the price of the watermelon will be based on the cost of the watermelon to Jedco plus 25 percent. Would this contract be enforceable in court? 1) Yes, because it is not necessary to set out final price in the contract as long as the price can be determined in some way, for example, by a formula. 2) No, because price is an essential term, and the parties have not clearly expressed the final price in their contract. 3) Yes, because the parties have agreed on a fair price. 4) No, because price must be decided at the time the contract is entered into and cannot be determined at a future date.
1
Which of the following is a possible legal justification for upholding a provincial law that prohibits the display of tobacco products in retail outlets? 1) If the government can show that the law reduces the incidence of smoking, the law may constitute a reasonable limit on freedom of expression. 2) The provincial government has sole jurisdiction over business activity. 3) The provincial governments have delegated jurisdiction. 4) The new tobacco law is constitutional because it protects health, and health concerns always override business concerns.
1
Which of the following is an example of how business law guides business conduct? Question 14 options: 1) The law sets rules and penalties to encourage compliance. 2) The law sets specific codes of ethics to guide conduct. 3) The law seeks levels of compensation exceeding losses. 4) The law limits executive compensation to guide conduct.
1
Which of the following is not a typical lawyer's fee structure? Question options: 1) "prix fixe" that includes all taxes and gratuities 2) billing at an hourly rate 3) annual retainer 4) percentage fee
1
Which of the following remedies would a court most likely award to restore parties to their original pre-contractual positions? 1) contractual rescission 2) injunctive performance 3) interlocutory performance 4) restitutionary quantum meruit
1
Which of the following situations might give rise to a "voidable contract"? 1) a contract entered into under duress 2) an illegal contract 3) a contract between spouses 4) a contract between partners in a partnership
1
Why is it important for businesses to monitor government policy? Question 9 options: 1) Rules and regulations are periodically revised. 2) It is the machinery that regulates government. 3) It provides rulings that resolve existing disputes. 4) It can be overwhelming and very technical.
1
A machine breakdown in one of Mr. Crustie's cookie plants resulted in a loss of production and an inability to fulfill some orders. Which functional area would be considered responsible for any legal consequences? Question options: 1) shipping & receiving 2) production 3) marketing 4) accounting
2
A staff member has received a number of sexually harassing telephone calls from a sales representative of a new supplier. Which functional area of the business may be exposed to legal risk? Question options: 1) purchasing 2) human resources 3) sales and marketing 4) information systems
2
Alpha Textile Ltd. has developed a line of clothing and is considering using the brand name Kalvin Clein in order to take advantage of the familiarity of its target market with a well-known designer named Calvin Klein. What legal consequences might Alpha Textile Ltd. face if it proceeds with its plan? Question 37 options: 1) being sued for negligence by its customers 2) criminal proceedings for breach of trademark legislation 3) being sued for damages by Calvin Klein 4) There are no legal consequences because it is not actually using the name Calvin Klein.
2
Dontally Imports Inc.'s overseas supplier is anxious to renew its expiring contract. However, shortages from this supplier have caused difficulties in the past. If Dontally contracted with a reliable new supplier instead of renewing the existing supplier contract, what would it do to its risk? Question options: 1) reduce the risk 2) eliminate the risk 3) transfer the risk 4) retain the risk
2
Each party to a contract must give something of value in exchange for receiving something of value from the other party. What is this called? 1) Deliberation 2) Consideration 3) Mutual Benefit 4) Agreement
2
EcoGrow Inc. contractually agreed to deliver two tons of organic fertilizer on March 16 to Organics Inc. The contract provided for the payment of $1000 for each day the delivery may be delayed. An ice storm closed highways, causing Eco to deliver four days late. What could you likely expect a lawyer representing Organics to argue before the court hearing a dispute over the non-payment of the late fee? 1) to have the court apply the parole evidence rule to the contract 2) to ignore the parties' intentions and apply the plain-meaning rule 3) to have the court apply the rules of construction to the contract 4) to ignore the rules of construction and apply the entire contract rule
2
Fatima needs to copy and bind five sets of legal submissions with beige covers, but none are left in the supply cabinet. The office manager offers to reimburse Fatima for the cost of the covers and buy her lunch from petty cash if she will dash to the nearby office supply store to buy them. Fatima agrees. What is the nature of the arrangement negotiated between Fatima and the office manager? 1) a formal accord 2) an informal business arrangement 3) a haphazard promise 4) a binding agreement
2
In a recent 2009 ruling, the Supreme Court of Canada found it necessary to direct that judges in lower courts were prohibited from redrafting overly broad non-competition clauses to make them legal and enforceable, stating that such clauses are simply and utterly unenforceable. Why did the Supreme Court find it necessary to invoke this prohibition? 1) to restate policy that vague or ambiguous clauses are unenforceable 2) because such clauses improperly bind employees unable to afford litigation costs 3) because such clauses are difficult to prove when the meaning is in fact unclear 4) to restate a central policy objective to facilitate drafting of broad clauses
2
In what manner could you reasonably expect a court to apply the parol evidence rule when asked to interpret the meaning of a nebulous term in a written contract? 1) Abide by the rule and use its discretion to infer a clarification of the term. 2) Disregard the rule and allow extrinsic evidence to resolve the ambiguity. 3) Abide by the rule and use its discretion to apply implied terms for clarification. 4) Disregard the rule and apply the reasonable person test to interpret the term.
2
In what way is SPAM different from marketing? Question 32 options: 1) SPAM is solicited by the recipient. 2) SPAM is electronic messaging that is unsolicited by the recipient. 3) SPAM is customized to the recipient for maximum effectiveness. 4) SPAM is expensive because it is directed to a large number of recipients.
2
Kamal is a computer technician who is about to enter into a one-year contract to provide IT services to a real estate agency. From Kamal's perspective, what is the most important function of this contract? Question 26 options: 1) to establish penalties for non-compliance 2) to deal fairly with unexpected events 3) to resolve conflicts 4) to plan for the future and enforce expectations
2
Matt purchases a car for his son from an auto dealership. A week later, his son discovers a defect that renders the car unsafe. The defect is one that a court would consider to be a breach of contract. What legal recourse is available to remedy this problem? 1) The court's resistance to imposing ethical business standards leaves no recourse. 2) Matt may commence a lawsuit against the dealer for breach of contract. 3) Matt's son may file a lawsuit against the auto dealer for breach of contract. 4) Matt's son can sue the manufacturer of the car for breach of contract.
2
Novel Swings Inc. has a contract to begin construction of a school's swing set on June 15th, and work is to be completed by August 1st. After weeks of wet weather, the ground was unsuitable for work to begin in June and Novel will not meet the completion deadline. Which of the following best describes the legal statutes of the contractual relationship between Novel Swings and the school? Question 22 options: 1) The contract is void due to wet weather. 2) The contract requires renegotiation. 3) The contract is in good standing. 4) The contract has been breached.
2
Olivia is suing a supplier for breach of contract. Assuming she is successful, what remedy might she expect to receive from the court? Question 18 options: 1) restitution 2) punitive damages based on the seriousness of the contract breach 3) aggravated damages 4) a sum of money that will put her in the position that she would have been had the contract been fulfilled
2
Recent legislation in some provincial jurisdictions overrides the common law that governed the acceptance of a payment of a lesser amount in full satisfaction of a debt. What is the policy rationale for the legislation? 1) to allow debtors to pay by instalments over time 2) to promote the settlement of debts on a final basis 3) to allow creditors to increase the collection of debts 4) to promote a reduction in consumer debt
2
Rumie paid a $5000 retainer to a lawyer to commence a lawsuit on her behalf. After rendering two $1000 accounts for research, the lawyer advised the claim was too small for him to attend to. He recommended another lawyer to Rumie. How does the law allow Rumie to proceed? 1) She must forfeit the full retainer and hire a different lawyer. 2) She must treat the contract as ended and sue for breach. 3) She must sue the lawyer to recover the balance of the retainer. 4) She must retain the lawyer that has now been recommended.
2
The Province of Newfoundland and Labrador enacted new regulations to better control hazardous waste disposal throughout the province. What type of law should specialized waste control businesses operating in Newfoundland and Labrador refer to in order to ensure their commercial activities are legally compliant? 1) civil law 2) statute law 3) equitable law 4) common law
2
The government enacted new legislation prohibiting retailers from displaying tobacco products except at the moment of sale at the till. Which of the following best describes the legal basis for a business to challenge the new law? 1) The new law is a violation of the commercial freedom of businesses and is therefore unconstitutional. 2) The new law interferes with freedom of expression, which is protected under section 2 (b) of the Canadian Charter of Rights and Freedoms. 3) The new law is likely to be ineffective in reducing the number of people who smoke or take up smoking. 4) The government has no legal right to control how businesses choose to display a legal product, because such matters are private law, not public law.
2
The purchase of stationery supplies from a retailer for cash, without an invoice or a receipt being provided in return, is an example of which of the following? 1) an incomplete agreement 2) a formal contract 3) a standard form agreement 4) an informal agreement
2
The shifting of risk to someone else through a contract is an example of what type of risk management strategy? 1) risk avoidance 2) risk transference 3) risk retention 4) risk acceptance
2
Threatening to withhold care from an elderly person in order to pressure them to enter into contract exemplifies which of the following legally exceptional circumstances? 1) unconscionability resulting from presumed pressure 2) undue influence resulting from actual pressure 3) misrepresentation resulting from presumed pressure 4) undue inducement resulting from actual pressure
2
Under which of the following circumstances would a court be likely to set a contract aside? 1) if there is a lack of sufficient equality of the benefits received by each party 2) if there is an attempt to take advantage of a handicapped, vulnerable person 3) if there were witnesses to the contract 4) if the parties put their contract in writing
2
A cancer hospital asked its privately owned medical isotope source to arrange an earlier shipment of an urgent order. The private supplier confirmed an earlier shipment was possible for a 30 percent surcharge on the contractual price. Because the hospital's cancer patients needed the isotopes desperately, the hospital faxed a written acceptance of the varied terms. The hospital subsequently refused to pay the price increase. What would a New Brunswick court hearing the ensuing dispute be most likely to determine? 1) Contractual variation supported by pre-existing duties is enforceable. 2) Where there is consent to a gratuitous variation, it is enforceable. 3) Contractual variation was supported by consideration, and therefore the variation is enforceable. 4) Contractual variation unsupported by consideration is enforceable.
3
A consumer conducting business with a bank must accept the standard set of terms expressed in the loan agreement, even though those terms are non-negotiable and typically favour the bank. Why would a modern-day court most likely continue to uphold these contractual "take it or leave it" arrangements? 1) the law expects a bank to show goodwill toward its customers 2) the agreement does not require further elaboration or clarification 3) the law expects people to take care of themselves 4) consumers accept the bank's unconditional offer
3
A hospital board of directors granted absolute authority to physicians to arbitrarily withdraw life support from patients. The board's authority to grant such power was quickly challenged and overturned in the courts. What type of law had to be applied to constrain the hospital board's authority? Question 17 options: 1) criminal law 2) constitutional law 3) administrative law 4) equity law
3
A judge has determined that offending portions of a contract can be severed and the remaining portions saved. What type of common law contractual infraction is this judge resolving? 1) a mistaken contract 2) a fraudulent contract 3) an illegal contract 4) a negligent contract
3
Although Maybelle's insurance excluded coverage for jewelry loss, her insurer mistakenly sent her a cheque to compensate her for the loss of an expensive piece of jewelry. What legal doctrine might the insurer use to recover the money that was mistakenly paid to Maybelle? 1) frustration 2) the duty to mitigate 3) unjust enrichment 4) misrepresentation
3
An accomplished lawyer accepts an appointment by the justice minister to the position of judge in the Provincial Court of Manitoba. What gives the minister authority to appoint this court's judges? 1) Provinces have jurisdiction to appoint judges to superior courts. 2) The province can use parliamentary prerogative to appoint judges. 3) Provinces have jurisdiction to appoint judges to inferior courts. 4) Canada's governments share concurrent jurisdiction to appoint judges.
3
An accomplished lawyer accepts an appointment by the justice minister to the position of judge in the Provincial Court of Manitoba. What gives the minister authority to appoint this court's judges? Question 10 options: 1) Provinces have jurisdiction to appoint judges to superior courts. 2) The province can use parliamentary prerogative to appoint judges. 3) Provinces have jurisdiction to appoint judges to inferior courts. 4) Canada's governments share concurrent jurisdiction to appoint judges.
3
Donelle agreed to rent her cottage to Juan for the first two weeks of June. Juan paid Donelle the rent due on May 29 by certified cheque. On the last day in May, a forest fire burned the cottage to the ground. What is the role of the doctrine of frustration with respect to the status of the contract? 1) It applies because Donelle has breached the contract. 2) It is not applicable; performance can be postponed. 3) It applies, as performance is no longer practical. 4) It is not applicable; the settled amount has been paid.
3
Fatalia is a party to a contract with Juno. She has initiated a claim for damages arising from breach relating the quality of workmanship. What type of breach is involved? 1) breach of innominate term 2) fundamental breach 3) breach of warranty 4) breach of condition
3
Gandrel received an offer to purchase on his home. The offer provided for the payment of the asking price but required Gandrel's new appliances and riding lawnmower to be included in the purchase price. Does Gandrel's offer to sell his home still have legal substance? 1) Yes, the original offer could be conditionally accepted. 2) No, the lapse of time automatically terminates the original offer. 3) Yes, it forms the basis of the purchaser's counter-offer. 4) No, a counteroffer is a terminal rejection of an original offer.
3
How does Canadian contract law protect minors and mentally incapacitated individuals? 1) by ensuring that they cannot enter into legally binding contracts 2) by requiring the courts to approve their contracts 3) by providing that only certain types of contracts are enforceable against minors and those who lack mental capacity 4) by ensuring both groups are represented by guardians when entering into contracts
3
How does the common law classify a situation in which both parties to an agreement have shared the same fundamental mistake in order to provide a remedy? 1) as a mistake at law 2) as a shared mistake 3) as a common mistake 4) as a mutual mistake
3
In his decision, Lord Wilberforce stated, "No universal rule can cover all such cases; they must be resolved by reference to the intention of the parties, by sound business practice and in some cases by a judgment of where the risks should lie...." What legal rule did Lord Wilberforce establish in his ruling on this case? 1) the postage rule 2) the postman rule 3) the postbox rule 4) the post office rule
3
In order to ensure certainty and form the basis for a contract, an offer must satisfy what condition? 1) It must be in writing. 2) It must contain a request. 3) It must contain all essential terms. 4) It must state when the offer will expire.
3
In the case of R. v. Ron Engineering & Construction Ltd. [1981] 1 S.C.R. 111, the Supreme Court of Canada reformed the legal structure concerning the tendering process in Canada. What did the Supreme Court state would form an element of the reformed legal structure? 1) Every party submitting a tender is accepting the offer of Contract B. 2) The only successful tenderer would enter into a Contract A with the owner. 3) The call for tender offered a preliminary contract called Contract A. 4) The call for tender offered a preliminary contract forming Contract B.
3
Mariam offered to sell her horse to Shia for $5000, but Shia counter-offered with a price of $4500. Mariam rejected Shia's counter-offer. What is the effect of Shia's counter-offer on Mariam's original offer? 1) Mariam's original offer is still available for acceptance until Mariam specifically revokes it. 2) The original offer is no longer available because it has lapsed. 3) Mariam's original offer is no longer available for acceptance because Shia's counter-offer is a rejection of the original offer. 4) Mariam's original offer is still available because she has not replaced it with a new offer.
3
To which level of government would a business make an application for a property zoning variance, and why? 1) municipal government; direct constitutional jurisdiction 2) municipal government; concurrent constitutional jurisdiction 3) municipal government; provincial constitutional delegation of authority 4) federal government; exclusive jurisdiction to regulate zoning
3
Under what circumstances would a court apply the objective standard test? 1) when deciding the amount of damages to award the winning party 2) if there is inequality of bargaining power between the parties 3) where it is unclear whether the parties intended to form a contract 4) if the enforcement of the contract might cause harm to a third party
3
What are the rules of equity? Question 15 options: 1) rules that set out the correct procedures to follow in court 2) rules that require wrongdoers to compensate their victims for losses 3) rules that focus on what would be fair given the specific circumstances of the case 4) strict rules that dictate the outcome of particular disputes
3
What common distinguishing characteristic may be attributed to both an option agreement and a counteroffer? 1) Both can result in a lawsuit for damages if deliberately rejected by the offeror. 2) Both are subject to revocation by the offeror prior to a lapse of a set period of time. 3) Both form a separate contract that may or may not lead to the acceptance of an offer. 4) Both serve to prohibit the lapse of an offer before a set time period has expired.
3
What is the defining characteristic of procedural law? Question 8 options: 1) It is a set of laws defining individual rights, duties, and liabilities. 2) It regulates the relationship between persons and governments. 3) It governs procedure for the enforcement of rights, duties, and liabilities. 4) It governs procedure for the enforcement of the Civil Code.
3
What is the definition of the legal term "assignment"? 1) the substitution of parties or replacement of one contract with another 2) the right to a remedy for breach when a party has sustained a loss 3) the transfer of contractual rights from one party to someone else 4) the transfer of a contractual right by an assignee to an assignor
3
What is the function of an express term with respect to a contract? 1) It gives effect to the parties' intentions. 2) It brings an existing contract to an end. 3) It explicitly states contractual promises. 4) It implicitly states contractual promises.
3
What is the goal of the common law remedy of rescission? 1) It seeks to provide redress to the innocent party. 2) It seeks to provide monetary redress for harm incurred. 3) It seeks to return parties to their pre-contractual positions. 4) It seeks to enforce good faith in commercial transactions.
3
What is the legal definition of "mistake"? 1) the threat of physical or economic harm that results in a contract 2) an unfair manipulation that compromises someone's free will 3) an error made by one or both parties that seriously undermines a contract 4) a false statement of fact that causes someone to enter a contract
3
What is the modern-day rationale for enforcing a gratuitous promise if the promisor has placed a seal beside his or her signature? 1) The presence of the seal protects against forgery. 2) The application of the seal suggests that the promisor has the power to compel fulfillment of the contract 3) The presence of the seal is taken as evidence of serious intent by the promisor. 4) The seal serves to verify the identity of the parties.
3
What key ingredient must be present in order to distinguish a legally enforceable promise from one that is legally unenforceable? 1) acceptance 2) formalization 3) consideration 4) Revocation
3
What test will a court apply when asked to determine whether or not a contract had been formed between two parties? 1) whether the contract is sufficiently complete to provide certainty to the court 2) whether the terms of the contract provide sufficient mutuality 3) whether a reasonable person could conclude that an offer and acceptance occurred 4) whether the parties to the agreement have duly informed legal counsel of their intentions
3
What types of employees should a company's head of risk management choose when putting together a negotiating team? 1) executives with highly developed abilities to deceive when necessary in order to secure a favourable agreement 2) experienced individuals who want to win and are willing to bluff and bluff hard to have a successful career 3) individuals with adequate legal knowledge for the negotiation of an enforceable contract that meets needs and protects interests 4) individuals who know the game and are not shy in demonstrating a complete lack of ethical standards
3
Which of the following best describes the nature of the mediation process? Question 34 options: 1) submission to litigation of the dispute before a judge in court 2) negotiated resolution with the assistance of a neutral person 3) submission to an arbitrator's binding decision to resolve a dispute 4) renegotiation of the contract with the assistance of a judge
3
Which of the following best explains the requirement that "contracts must be supported by mutual consideration"? 1) There must always be at least two parties to a contract. 2) Contracts require that the parties treat each other fairly. 3) A contract involves a bargain or exchange between the parties. 4) Contracts must be in writing to be enforceable.
3
Which of the following is NOT an example of an invitation to treat? 1) a newspaper advertisement 2) a display of goods in a retail store 3) a lost and found advertisement 4) an expression of interest to enter negotiations
3
A large greenhouse grower that wants to source a suitable organic liquid fertilizer contacts Organics . The grower is willing to pay a premium price for Organics's product. Accepting the order would mean Organics will not be able to completely fill existing orders to its current customers. Organics desires the new business but wants to maintain its existing customer base. Which of the following strategies should Organics use to solve this problem? 1) Abandon all but the most important of the existing orders and fill the new order. 2) Present an ultimatum on existing orders offering delivery on a later date or nothing at all. 3) Comply with existing obligations, fill the orders, and offer the new business what is left. 4) Offer a price break on existing orders in return for varying quantity and delivery date.
4
A legal risk management team meets with its manager to discuss its inability to complete its assignment because it has been waiting for an outstanding legal opinion for weeks. What selection criterion was most likely missed when this company's lawyer was hired? Question options: 1) willingness to communicate 2) scope of legal services required 3) understanding of the business 4) knowledge of the industry
4
A seller unknowingly made a misrepresentation during negotiations to sell his car. Now that the seller is aware of the misrepresentation and the prospective buyer is returning to make an offer, what recourse is available to rectify the situation and accept the offer without risking an ensuing lawsuit? 1) The seller has no recourse; once information is offered, it must be completely accurate. 2) The seller can remain silent to secure the best price and plead mistake as a defence. 3) The seller should simply forego the deal with this buyer and look for a new buyer. 4) The seller must attend to the prompt disclosure of the correct facts to the prospective buyer.
4
Amanda has agreed to attend Rebecca's home and provide her with biology tutoring for three hours per week for a flat fee of $50. What is the legal term for Rebecca's promise to pay Amanda $50 each week? 1) gratuitous promise 2) nominal fee 3) ratification 4) consideration
4
Benta recently purchased a business that has been providing cleaning services to a number of large office building operators. Which of the following actions would immediately alert Benta of potential legal risks with its new company's customers? 1) consult with a law firm to devise a legal strategy 2) consult and arrange insurance to cover legal risks 3) schedule introductory meetings with customers 4) review contracts and customer payment history
4
Even though Dalbert knew Rahim had consumed copious amounts of alcohol during the afternoon, both signed a contract written on a napkin whereby Rahim agreed to buy Dalbert's old car for top dollar. Upon regaining his legal capacity, if Rahim opts to repudiate the contract on the basis of an improvident agreement, how must he proceed to void the contract? 1) He must claim relief due to the effects of duress. 2) He must claim relief due to economic duress. 3) He must claim relief due to undue influence. 4) He must claim relief due to unconscionability.
4
Globe Investment Inc. has discovered that one of its employees has been overcharging clients for the company's services. The employee has been terminated. What type of law determined the employee's punishment? Question 6 options: 1) employment law 2) business law 3) criminal law 4) contract law
4
Groot Industries Inc. requires more space in order to expand its business. Which of the following is a legal decision that Groot Industries Inc. must now undertake? Question 21 options: 1) who should be hired to construct a new building 2) whether its new premises will be regulated by health and fire regulations 3) whether to buy, build, or lease additional premises 4) whether to obtain insurance for its new premises
4
How does a legal contract contribute to a business relationship? Question 38 options: 1) It contributes uncertainty of liability in the relationship. 2) It defines the moral principles and values of the relationship. 3) It provides principles of paramount to govern the relationship. 4) It gives structure, predictability, and security to the relationship.
4
In order to avoid having a court impose a classification of a contractual obligation as an innominate term, which of the following actions would be appropriate? 1) Ensure that all contractual obligations are clearly described in the contract. 2) Avoid the use of ambiguous language that leads to erroneous assumptions. 3) Avoid the use of contractual promises that hold less significance or importance. 4) Clearly set out the consequences of the breach at the time the contract is created.
4
In what way are promises between family members treated differently than promises between other parties? 1) Contracts between family members are prohibited. 2) Family members cannot sue one another for breach of contract. 3) Promises between family members are always treated as gratuitous promises. 4) The law presumes promises between family members are non-contractual.
4
In what way is mediation different from arbitration and litigation? Question 31 options: 1) Mediation is free and does not require the assistance of a lawyer. 2) Mediation is time-consuming and tends to be ineffective. 3) Mediation results in an informal, non-binding decision. 4) Mediation involves the use of a neutral party to assist with resolution of the dispute.
4
Jaspreet agreed to hire Zen Home Builders Ltd. (Zen) to construct his new home. Jaspreet, Zen, and their lawyers met to review and sign a contract that provided for specific types of environmentally safe construction materials to be used. In many instances, Zen failed to use the stipulated "green" construction materials. Faced with determining a resolution to the ensuing dispute, what would a court rely on the existence of to establish that a contract was in place? 1) Jaspreet's entitlement to rescind the contract due to poor contractual performance. 2) A framework of rules created by the parties and which judges automatically enforce. 3) Mandatory rules which every type of contract is subject to. 4) An intention between the parties to create a legal relationship.
4
Of the following statements, which is most accurate regarding the executive branch of government? 1) The executive branch of government consists of the prime minister and the premiers of the provinces and territories. 2) The executive branch of government provides rulings to resolve existing legal conflicts. 3) The executive branch of government passes laws that impact business operations. 4) The executive branch of government includes the formal executive and the political executive.
4
Prior to completing the financing arrangements needed to fund the purchase of an IT consulting firm, Albert Brinkman met several times with his bank and his accountant to re the terms of the bank's financing offer against the business's financial statements. What activity and corresponding step in the legal risk management process is this? Question options: 1) avoiding the possibility of loss; first step 2) transferring legal risk; fourth step 3) evaluating severity of potential loss; third step 4) identifying risk in business decisions; first step
4
Quest Electrical Engineers Inc. contractually committed to provide specialized services to a construction project with specified deadlines for completion. Quest has to meet deadlines or face penalties. What type of law governs the relationship and conduct of the parties to this contract? 1) common law 2) corporate law 3) public law 4) private law
4
Shadow Awning Inc.'s employee attended a client's home to install an awning over a window. What has just occurred? 1) novational performance 2) substitutional performance 3) assigned performance 4) vicarious performance
4
Toyota Motor Corp. recalled 8.8 million cars after some of its vehicles were found to have unintended acceleration problems. Which goal of a legal risk management plan were Toyota's actions meant to achieve? 1) to eliminate risk 2) to identify potential risk 3) to evaluate risk 4) to reduce impact
4
What does the term "legal risk" mean in the business environment? Question options: 1) risk of being held liable under the civil law 2) the risk of breaking the law 3) the risk of conviction of a white collar crime 4) any business risk with legal implications
4
What is a distinguishing characteristic of the principle of precedent law? 1) It is based on a Civil Code. 2) It applies only in Quebec courts. 3) Individual freedoms are valued. 4) Like cases should be treated alike.
4
What is the definition of an "anticipatory breach"? 1) a breach that occurs purely for ethical reasons 2) a breach that occurs purely for economic reasons 3) a breach that creates anticipation 4) a breach that occurs before the date for performance
4
What is the legal term for a remedy in which the court uses its jurisdiction to order an injunction for a stated period of time? 1) specific injunction 2) interim injunction 3) temporary injunction 4) interlocutory injunction
4
What is the main goal of the Canadian legal system? Question 40 options: 1) to facilitate commerce and mediation of disputes 2) to facilitate arbitration and free trade 3) to facilitate free trade and planning for the future 4) to facilitate planning, protection, dispute resolution, and justice
4
What is the objective of a limitation of liability clause in a contract? Question options: 1) avoid the risk, be legally enforceable, and be acceptable to the other party 2) transfer the risk, be legally enforceable, and be acceptable to the other party 3) reduce the risk, limit the liability, and be acceptable the other party 4) reduce the risk, be legally enforceable, and be acceptable the other party
4
What is the paramount function of Canadian constitutional law? 1) It sets a parliamentary code of ethics. 2) It creates structure for ceremonial policy. 3) It establishes Canada's deference to British Parliament. 4) It establishes Canada's structure of legal authority.
4
What is the purpose of contract law? Question 3 options: 1) to ensure litigation of parties committing contractual breach 2) to prescribe principles and values for use in society 3) to determine right and wrong in the business world 4) to enforce expectations and facilitate planning
4
What is the third step in the legal risk management process? 1) hire a legal professional or insurance consultant to identify potential risks 2) carry out the plan, monitor, and revise the plan 3) assess the probability of loss 4) devise a risk management plan
4
What is the traditional view regarding the recovery of non-pecuniary damages in the context of contract law? 1) They are recoverable unless the plaintiff has failed to mitigate. 2) They should be awarded in cases of malicious, oppressive, and high-handed conduct. 3) They are regarded as a natural consequence of a contract breach. 4) Recovery is regarded as historically unusual.
4
What position, if any, would a lawyer have on the risk management team? 1) professional risk management supervisor 2) part of the executive management team 3) excluded from team; acts as legal consultant 4) part of the team or a consultant to the team
4
What principle could you reasonably expect Canadian common law courts to apply when faced with cases dealing with standard form contracts? 1) Customers' continued use amounts to acceptance of unilateral amendments. 2) Terms are to be set out in plain language, and legalese must be absent. 3) Pre-printed terms are put inside a box to which reference is made on the outside. 4) Ambiguous terms should be construed against the party that prepared the contract.
4
When resolving contractual conflicts, what laws do the courts usually apply? 1) the Contracts Act 2) the Sale of Goods Act 3) Judges make all decisions based on the principles of fairness and equity. 4) Judges apply common law and occasionally statutory law.
4
Which governing bodies are the primary regulators of business activities in Canada? 1) the federal and municipal governments 2) the Senates of the federal and provincial governments 3) the federal and provincial governments 4) the provincial and municipal governments
4
Which legislature is the lower chamber to the Senate? 1) the Legislative Assembly of British Columbia 2) the Parliament of Canada 3) the House of Assembly of Nova Scotia 4) the House of Commons
4
Which of the following is NOT an objective of business law? Question 9 options: 1) protection of business ideas and tangible property 2) ensuring losses are borne by those who cause them 3) imposition of fines on those who breach contracts 4) facilitating planning by ensuring compliance with commitments
4
An entire contract clause could be used to prevent a court from using outside evidence to interpret a contract. 1) True 2) False
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