Posted: August 1st, 2024

BMGT 380 – Final ExamQuestions

BMGT
380 - Final ExamQuestions
INSTRUCTIONS:
THINK. CHOOSE THE ONE BEST ANSWERTO
THE MULTIPLE CHOICE QUESTION. PLACE YOUR ANSWER
ON THE ANSWERSHEET BELOW.
SUBMIT YOUR ANSWERSHEET THROUGH
YOUR ASSIGNMENT FOLDER IN LEO. THERE IS ONLY ONE CORRECT ANSWER. MAKE SURE I CANFIND YOUR ANSWERS.

PROVIDE
SHORT, TO THE POINT, FULL ANSWERS TO THE FIVE ESSAY
QUESTIONS. SUBMIT YOUR ANSWERSVIA
YOUR ASSIGNMENT FOLDER IN LEO.

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YOUR ANSWERSMUSTBE
SUBMITTED BY11:59 PM ON MAY8,2016. Time is of the essence.READand
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Multiple Choice= 40points:
1.
Samorallyagreed
tosellJamiesomelandfor$500,000.
JamiepaidSamthe$500,000;
SamgaveJamiethedeedtotheland.Jamietookpossessionofthelandandbeganbuilding
a cabin on it. One monthlater,
Sam tried to retakepossessionof theland by arguing that the
contract forthesale was
invalid because it was oral, not written.
Samsued Jamie to invalidate the
contractand retake theland.
ThecourtwilllikelyconcludethatSamwill:
a) Win;
thesale exceeded $500 so the contract must be writtento be
valid underthe
StatuteofFrauds.
b)
Win;all land sales contracts must bewritten.
c)
Lose;becausethecontractwas
fullyexecutedSamcannotrescind
thecontract.
d)
Lose;becauseJamiehadbegunbuildingacabinontheproperty,
Samcannotrescind thecontract.

2.
On Tuesday, Jon offeredto sell his CD collection to Sandy for $100. Sandyreplied, "I'm interested.I'll thinkit overand let
you know Thursday whetherI wantto buy
theCDs."OnWednesday,Jonagreed
toselltheCDstoJason,
andJasonimmediatelygaveJona letter thatstated:
"Jon,IwillbuyyourCDcollectionfor$100.Asweagreed,IwillpayyouonFriday
whenI pick up theCDs.
Yours truly,Jason."
UponJon'sreceiptofthisletter
onWednesday,whatbestdescribes
Jon’scontractagreement(s)?
a)
Byforming
anagreementwithJason,Jonbreached
hiscontractwithSandybecause
he didnoteffectivelyrevokehisoffertoSandy.

b)
Jonhas
formedcontractswithbothJasonandSandybecauseJondidnoteffectively
revokehisoffertoSandyandcreated
anenforceablewrittenagreement
withJason.
c).JonandJasonhaveformedavalid,
enforceablecontract;Jon’soffertoSandywas
properlyrevoked.
d) Joneffectively revokedhis offerto Sandy, buthas not formedanenforceable
contract with Jason because Jasonhas
notyet paid fortheCDcollection.

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3.
MacandRhamadsigned
abusinesscontract
withaclausethatprovides
thatifadispute
arises they must submitto binding arbitrationto resolve the dispute. After theyhad been doing business together fora year, a dispute arose under the termsof the contract. Ratherthan submitto arbitration,Mac filed a lawsuit against Rhamad. Mostlikely
the courtwill:
a)
Hearthelawsuitbecause
Maccannotbecompelledtosubmit
toarbitration;heis
constitutionallyentitled
toajurytrialifherequestsatrial.
b) Conductahearing,thenorderaremedywithout
compellingMactosubmitto
arbitrationortoajurytrial.
c) CompelMac to submitto arbitrationto
resolve thedispute.
d)Hearthelawsuitinatrial,
thencompelMactosubmittoarbitration,ifMacisnot satisfied with the trialdecision.

4.
Roxy,while
drivingthroughWyomingtoherhomeinMontana,accidentallylostcontrol
of her car and droveit througha window intoa store ownedby
Colt. Colt sued Roxyin a Wyoming
courtfordamages
tohisstore.
WilltheWyoming
courtlikelybeabletoexercise
jurisdictionoverRoxy?
a) No,becauseWyominghasnoinpersonam
(personal)jurisdictionoverRoxy,andcannot
exerciseitslongarmstatute
onlyincasesinvolvingautomobileaccidents.
b)
No,becauseWyominghasnoinpersonam
jurisdictionoverRoxy,andcannotjustify
minimum contactsin thiscase.
c)
Yes,Wyoming
canexercisejurisdictioninthiscasebecause
thereisafederal
question involveddue to the diversity of citizenshipbetween theparties.
d) Yes,
becauseWyomingcanassertinpersonamjurisdictionoverRoxyundertheminimum contactstest.

5.
Assumea salesperson
intentionallymade oneof the following statements- knowingthat the statementwas false - to a customer
consideringa purchase. Which
statementcould createliabilityforfraudulentmisrepresentationifthecustomer
madethepurchase?
a) “Inmyopinion,
thiscarisinflawless
mechanicalcondition.”
b) “Thiscrane
willprobablyliftabout10,000
pounds.”
c) “Thiscarisarealgem.”
d) “This is an original paintingby
theartist,
PabloPicasso.”

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6.
Ram was walking downthesidewalk bya constructionproject
sitein a downtownarea. Theprojectwasownedandoperated
byModernConstruction,Inc.andwassurroundedby orangeplasticfencingtypicallyusedforconstructionprojects. Ram
stoppedtowatcha metal beam being lifted bya crane on theconstructionsite.
As thebeam swungthrough theair,Ramthoughtitwasgoingtofallandjumpedforwardquickly
offthesidewalk
and into theconstructionproject property,falling intoand smashing theorange
plastic fencing. AsRam landed insidethe
construction project,thebeam fell near Ram. The beam did nothit Ram butsomerocks
were thrownontoRam as thebeam fell, cuttinghis
armsothatitrequired35stitches.
IfRamsuesModelConstructionfornegligence,thelikely
resultwillbethatRamwill:
a) Lose,
because he assumed the riskas
a trespasseron theconstruction
siteand
trespasserscanneverrecover
damages.
b)
Lose,becausepedestriansarealwaysliable
undercontributorynegligenceinsuchcases involvingtrespassing.
c)
Win,becauseitisalways
foreseeablethatabeamcouldfallonarescuing
pedestrian.
d)
Win,ifthebeamfellbecause
ofModelConstruction’snegligence.

7.
Kim carelessly parked her car ona steep hill, leaving thecar
in neutraland failing to engage the parkingbrake. Thecar rolled down thehill
and knocked downan electric line.
The sparks from the brokenline
ignited a grass firethat spread to
a barn several yards away. The roofof
the burning barnfell and damaged a passingcar ownedby Ray. Can Ray likelyrecoverdamages
fromKimunderordinarynegligence?
a)
Yes,becauseKimwasnegligent
inparkingthecar.
b) Yes,becauseKimsetinmotion
thechainofevents
thatresultedindamagetoRay’scar, eventhoughKimdidnotdirectly
hitthecar.
c) No,because of the unforeseeable intervening forcedoctrine.
d) No,regardlessofKim’snegligenceinparking
thecarashernegligencewasnotthe proximatecauseoftheaccident
andharmthatoccurred
toRay.

8.
Lee sued Donin
negligence. Lee’s losses total $100,000.Under
a contributorynegligencesystem,ifLeeisfoundtobecontributorilynegligentforherowninjuries,
what damages will Lee like recoverfromDon?
a)None.
b)$100,000.
c)
$100,000,less
thepercentageoffault(e.g.,
20%,60%,etc.)forwhichLiwas
responsible.
d)
$100,000,less
thepercentageoffault
forwhichLiwasresponsible,solongasLiwas
not
morethan50%responsiblefortheinjuries.

9.
Don promisedto buy
his girlfriend, Sophie,a new
car so Sophiesold her old car. Don now
refusestobuySophiethecar.Sophiehasajobthatrequires
hertohaveacartoget

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to work.If
Sophiesues Donto enforce the promise,thelikely resultis that the promisewill:
a) Be enforced
under promissory estoppel because
Sophiereasonably relied onDon's
promise,to her
detriment.
b)
Notbe
enforcedbecause
Sophiereceivedmoneyfromthesaleofheroldcar;ifshealso
receivedthenewcarfromDon,shewouldbeunjustly
enriched.
c)
Beenforced
becausethecarisanecessity
forSophieandallcontractsfornecessities arebindingandenforceableforallpartiesevenifcontractformationisflawed.
d)
NotbeenforcedasDon’spromisewasagifttoSophie;Sophiegaveconsideration,but Dondidnot.

10.
XandYagreedthatXwouldsellYhissmallbusiness,
includingthelandonwhichthe
businesswas situated, for$500,000.
BothX and Y knewat the time the
contractwas formed that the
businesswas actually worth$800,000.
Is this a valid, enforceable contract?
a) Yes, provided
the contractwas in writing,in
accordance with theStatuteof Fraudsand
theparties freelyconsented.
b)
Yes,provided
thecontractwasinaccordancewithstatestatutorylawthatpermitsreal estatesales
for40%ormorebelow
marketvalue.
c)
No,because$500,000isnotvalidconsiderationforabusiness
worth$800,000.
d)
No,becauseXhasnopre-existinglegaldutytosellhisbusiness.

11.
FineArtCorp. sentawritten
offertobuy10,000pencils
foratotalof$10,000
fromFaber Pencil Co. Bothparties
are merchants. Faber can accept the offer
by:
a) Promisingto shipthepencils.
b) Promptly
shippingthepencils.
c) Accepting
the offer onFaber’s
own written standardformcontract.
d)
Alloftheabovecould
bevalidacceptance.

12.
Ralph, a 16-year old minor,
is manager forthehigh school
footballteam. Ralph signedacontracttopurchase
alcoholicbeveragesfromLiquormart,Inc.fortheteam
party.
This contractis:
a) Voidasamatteroflawbecauseitisillegal
tosellalcoholtominorsbystatelaw.
b) Void
onlyifRalphmisrepresentedhisageandtoldLiquormarthewasanadult.
c) Valid
andenforceable,butRalph
hastherighttodisaffirm
becauseheisaminor.
d)
Validandenforceable,ifLiquormartknewthatRalphwasaminor.

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13.
Whichofthefollowing
activitiesmayinvolvetheuseofacontract,and/orconstitute
a salescontract?
a) Purchasing
medications fromapharmacy.
b) Hiringa contractor
to make homerepairs.
c)
Purchasing insurancepolicies froman insuranceagent.

d) Selling booksto customersin
abookstore.
e)
All of theabove.

14.
Fay was admitted to Global Associates,
an existinggeneral partnership on January,2014.In August,
2014, a partnershipdebt thatwas incurred in October, 2013came due. Fayis:
a) Notliableforthedebtbecause
thedebtwasincurred
priortoherjoiningthepartnership.
b)
Onlyliableforthedebtuptotheamountofhercapitalcontributiontothe partnership.
c) Personallyliableonlyfor50%ofthetotaldebtif50%oftheotherpartners
donotpay.
d) Personallyliableforthefullextent
ofthedebtiftheotherpartners
donotpay.

15.
Kelly, Lars and Monaagreed
to be partnersin NeighborhoodDeliveries (ND), all splitting the profitsequally. Kelly contributed70% of thecapital uponformationof the partnership.Later, the
partnersagreed to dissolve the
partnershipas it was notas profitableastheyhadexpected,anditsliabilitiesweregreaterthanitsassets.
The lossesare paidby:
a) All the
partnersin proportiontotheir capitalcontributions.
b) All the
partnersin proportionto
their shareof theprofits.
c) Kelly
alonebecauseshecontributedthemostcapital.
d) Lars
andMonabecausetheycontributedtheleastamountofcapital.

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16.
CC’sDaySpa,LLC,isamember-managedlimitedliabilitycompany.Solongasitisin
accordance with statelaw, and
unless the members previouslyagreed
otherwise, voting rightswill be apportioned accordingto:
a) Participationinmanagement.
b) Capitalcontributions.
c) The numberof
members.
d) Each
individualtransactionoftheLLC,andwillvarywitheachtransaction.

17.
Jim and Kiley are architects
and general partnersof JK Designs.Jim andKiley superviseLuc,
an employee ofJK Designs. As partners,Jim andKiley
a)
Arepersonallyliableforany/alltort(s)committedbyLuc.
b)
Maybeliable
formalpractice,butnottorts,committed
byLucwhileLucisworking within the scopeof his job atJK.
c) May be
liable fortortscommitted
by Luc while Luc is working within
the scopeofhis
job at
JK.
d) Have
noliability forany tortscommitted
by Luc at anytime.

18.
KishaoperatesRiverValleySoccer,anathleticequipmentshop,asasole proprietorship.
Taxes on the business’s incomeare
paidby
a) Noone;
since it is a sole proprietorship thereare
no businesstaxes.
b) Kishaas the soleowner.
c)
ThestateorfederalgovernmentifKishaholdsaSmallBusinessAdministrationloan acquired to startherbusiness.
d)
Thebusiness
entityofRiverValley
Soccer,notKishapersonally.

19.
Assumethat Virginia enacted a law prohibiting, until further notice,all
grocery storesin Virginia fromselling all powderedspices manufactured
in, or shipped from,Maryland.
This law was enacted because it was discovered
that thespices recently manufacturedin Maryland were infected withbacteria. Determine the constitutionalityof the
Virginia statute. The statuteis:
.gif">olates grocery store owners’ substantive and proceduraldue

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b)
Unconstitutional; the statute imposesan undue
burdenon interstatecommerce.
c)
Constitutional;itisavalidexerciseofVirginia’spolicepower.
d)
Constitutional; the statute
involvesthesale of goods whichis valid under UCC rules, thus,the stateconstitutiondoes notapply.

20.
Distinguishwhich
ofthefollowing
isanadvantageoflimitedliabilitycompanies(LLCs)
overcorporations.
a)
OnlyonememberofaLLCmusthaveunlimitedliabilityascompared
withcorporationsinwhichallshareholdershaveunlimited
liability.

b) LLCs
canbeformedwithoutanyspecificstepsbeing
takenbytheownersascompared
withcorporationsthatmustfileArticles
ofIncorporationwiththeState.

c)
Inmostcases,aLLCcanchoose
whethertobetaxedasapartnershiporcorporation,
ascomparedwithcorporationsthataresubject
todoublecorporate
taxation.

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d) LLCs
canchoosewhether
tosellsharespublicallytoinvestors,ascomparedtoprivate corporationsthatmustsellsharespublicallytoinvestors.
21.
Pete, whocollects
antiquecars, hired Annas his agent to findand purchase
a 1965 Ford Mustangon his
behalf. Annfounda Mustang
just like Pete wanted, butAnnfell in
love with thecar and purchasedit forherself.
Whichof the followingillustrates Ann’sliability, if any, in her duty as
agent to Pete in this situation?
a)
Annhas
notviolatedthedutyofloyalty
toPete;shecanfindanother
Mustangforhim.

b)
Annhasnotengaged
inself-dealingbecause
shedidnotpurchase
theMustangwithPete’sfunds.

c)
AnnusurpedanopportunityforPete,
buthasnotviolatedthedutyofloyaltytoPeteby
competing withPete’sinterests.

d)AnnviolatedthedutyofloyaltytoPetebycompeting
withPete’sinterests,andhas
usurpedan opportunity forPete.

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22.
Ed hired Frankie, whois
13 years old, to buya computeron Ed’s behalf. Whichofthefollowingidentifiesthelegal
relationshipbetween
EdandFrankie?
a)
Thisisavalidagency
relationshipeventhough
Frankieisaminor,
andEdwouldbe boundbyauthorizedcontractsFrankie
entersintoonEd’sbehalf.

b)
Thisisavalidagency
relationshipeventhoughFrankieisaminor,butEdwouldhavethe
optionofdisaffirminganycontracts
FrankieentersintoonEd’sbehalf.

c)
Thisisavalidagency
relationshipeventhough
Frankieisaminor,butFrankiewouldnotbe
entitledtoanypayment
underthetermsoftheagencybecauseheisaminor.

d)
Thisisaninvalidagency
relationshipbecause
Frankieisaminor.

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23.
Mediation might be more
reasonableand appropriate than a trial
in which of the followingsituations?
a)
Alawsuitchallengingtheconstitutionalityofanewstatestatute.
b)
A disputebetween
neighborsover aproperty
boundary.
c)
Anallegedtheftofpatiofurniture
fromthepatioofahouse.
d)
Noneof the
aboveare appropriate formediation.

Answer questions24-25 regarding the followingscenario:
Scenario:Jones,a resident of Arizona, booked reservations fora vacation at World
Hotels,Inc. in Cabo Mar, Mexico. World
Hotels is an international hotel chain
incorporated in Delaware with hotelsin
Northand SouthAmerica; World Hotelshas
no hotels in Arizonabutdoes advertise
and book reservations forall
its hotelsover the internet,in any state. World Hotelshas booked reservationsin the past with residentsof Arizona.
While a guest in the hotelin
Cabo Mar, Joneswas walking across the hotel lobby,and slipped and
fell on thewet marble floorthat had been just washedby the maintenance staff. The staffhad placed a “wet floor”sign on the lobby floorby theside
wall of the lobby.

Joneswas
taken to thenearest Mexican hospital where surgerywas necessary to
place a pin in his brokenleg. Anxiousto return homeand
see his regular doctor, Jonesflew outof Mexico shortlyafter the surgery.
Herequired twoplane seats
and an ambulance to meet him at various
airports.His health insurancewould
notcover his hospitalstay in Mexico as it was located outside theU.S. Whenback in Arizona, Joneswas
unable to work for 8 weeks and required another surgeryto remove thepin. Healso
required several weeks of physicaltherapy.

24.
Jones wantsto sue
World Hotels,Inc. fornegligence
for $450,000 torecover all his
medical expenses in Mexico and the US; for$50,000
for the costof theplane trip fromMexico to Arizona,
the2 plane seats and ambulance costs
in various airports; $10,000
for 8 weeks of lostwages; and $50,000 forpain and suffering resultingfrom theinjury. Can he suein
federalcourt?
a) Yes,
becausefederalcourtalwayshasjurisdictionovercitizens
ofdifferentstates.
b)
No,because federal courtdoes not have jurisdictionin cases that do not involve federallaws.
c) Yes, because thefederal courtmay have jurisdictionover
citizens of different states
andthelawsuitinvolvesdamages
greaterthan$75,000.
d) No,because thefederal courthas no jurisdictionover
an accident that occurred in Mexico.

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25.
It would beeasier
for Jonesto bringthelawsuit in Arizonastate court, buthe wondersif
the courtcan get World Hotelsto cometo Arizona.Can the
Arizona state court
impose jurisdictionoverWorldHotels
tobringthe companytocourtinArizona?
a) No,becausethesubjectofthelawsuittookplace
inaforeigncountry.
b)
No,because thecorporation does not have
sufficient minimum contacts withArizona
to allowtheArizona
courttousethelongarmstatutetoestablish
jurisdictioninArizona.
c)
Yes,becausetheJonesisaresidentofArizonaandheistheplaintiffinthelawsuit.
d) Yes, because World Hotelshas sufficient
minimum contact with the stateof Arizona to
justify the court’s useof the longarmstatute.

26.
Dan went to Doctorto
havean x-ray. Dan did notsign a written contract, and Dan and Doctordid not makean oral agreement regarding
thex-ray. When Doctorbilled
Dan $500for the x-ray, Dan refusedto pay. Doctorsued Dan to recover the
$500. Which of the followingis
true about Doctor'slawsuit?
a)
Doctorcan
recoverunderthequasi-contracttheoryofpromissory
estoppel.
b)
Doctorcan
recoverunderanimplied
contracttheory.
c)
Doctorcannotrecoverbecausetherewasnoexpresscontract.
d)
DoctorcannotrecoverbecauseDandidnotgiveconsiderationforthebargain.
27.
Under theUCC, Section
2-207 (the"battle of theforms"
provision), it is providedthat,whenbothpartiestoacontractaremerchants,anyadditionaltermsadded
inthe

acceptance ofa standard
form contractcan properly,validly
becomepart of the contractualagreementUNLESS:
a)
Theoriginal
offerexpresslylimitsanyacceptanceonlytothetermsintheoriginal
standard formoffer.
b) The
additionalterms
intheacceptancemateriallyalterthetermsoftheoriginal
standard formoffer.
c) The
offerornotifiedtheofferee,
withinareasonableperiod
oftime,thatthe
additional termswere notacceptable.
d) All of theabovecould betrue. e)
28.
If Earl, a nonmerchant,
offeredto sell a chair to Isaac, a nonmerchant.
Earl's housecaught fire and destroyed thechair beforeIsaac accepted Earl's offer to buy thechair. Consequently,
a)
Thedestructionofthechairconstitutesanautomatic
validrevocationoftheoffer.
b)
Thefiredoesnotautomaticallyrevoketheoffer,butbecause
neitherEarlnorIsaacis
amerchant,theofferisrevocable
atanytimeatEarl'soption.
c)
Earldidnotvalidly
communicatearevocationtoIsaac,soIsaacstillhastheoptionof accepting Earl's offer;if Isaac accepts the offer,Earl must obtaina similar chair for
IsaacorpayIsaactheequivalentvalueofthechair.
d)
Earl'sofferisautomaticallyrevokedbythefire,unlesstheofferwasafirmoffer.

29.
Regoffered
tosellhismotorcycletoThelma
for$8,000.Thelmareplied,
"Yourprice is too high.I will purchase your motorcyclefor$7,000".Reg agreed and they committed
theiragreementtowriting.
Thistransactioncanbecharacterizedas:

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a) Anenforceablecontractbecause
Reg'sacceptanceofThelma'sofferwasaclearly communicatedacceptance.
b) Anenforceablecontractbecause
Thelma'scounterofferwaslessthanReg'soriginal
offer
c) AnunenforceablecontractbecauseThelma'sofferwasnotthemirrorimageofReg's originalofferasisrequired
undercommonlawcontract
rules.
d)
AnunenforceablecontractunlesseitherRegorThelmaisamerchant,
asdefinedby the
UCC, becausesale of personal property contractsare valid only
if oneof theparties to the contractis
amerchant.
30.
A ordered 100 19-inch color
TV sets fromB, and requested
prompt shipmentof the goods.B promptly shipped toA 100 21-inch colorTV sets. Prior toshipment,
B did not
notifyA that he was shipping nonconforming
TVs as an accommodation. Assuming
bothA andBaremerchants,under
UCCrules,inthiscase:
a)
ThereisnovalidacceptancebyB;shippingnonconforminggoodsactsasacounteroffer,andthus,cannotconstituteanacceptanceorcreateavalid,enforceablecontract.

b)
AlthoughB shipped
nonconformingTVs,A is boundto pay thereasonable
value of the21-inchnonconformingTVsetsbecause
B'sshipmentconstitutedavalidacceptance,anda binding contractwas formedat the time thegoods wereshipped.
c)Although
BshippednonconformingTVs,ifAaccepts
andlatersells
the21-inchTVs,A
hasvalidlyaccepted
thenonconforminggoodsandisboundtopayBreasonablevalue
for
the21-inch
TVs.
d) There is
no contract becauseB’s acceptance
(by shipping the goods)is nota
mirrorimage of A’soffer.

31.
Contractsinvolvingthesale
ofgoodsvalued
atover$500mustbeinwriting
inorder to be enforceable? True
orFalse.
32.
B & B Tape Co. orally agreed to sell 2,000 boxesof tape
to Office Supply,Inc. (Office)at a rate of $1.00 per box, fora total of$2,000. Office orally agreed to thedeal. B & B
delivered 1,000 boxes, totaling
$1,000. Office accepted the delivery and used and sold thetape, butrefused to pay forthegoods, citing the Statute ofFrauds. Under
these circumstances, Officeis obligated topay:
a)
Nothing,andmaykeepthetapebecausetheagreement
isunenforceablebecauseitwas
not
written.
b)
$1,000forthe1,000boxesthatOfficeaccepted,butisnotobligatedtoaccept,
orpay for,any moretapes.
c) $2,000as
Officeisboundtobuytheentire2,000
boxesoftape.
d) $1,000forthe1,000
boxesthatOffice
alreadyaccepted,plus$500forone-halfof the
remaining 1,000boxes.
33.
Employer promised to pay Employee a $10,000 annual pension for theremainder of Employee's life, uponEmployee’s retirement.In return,
Employee promisedto pay Employer $100 per year for each of theyears he works until retirement. Employeerelied on this
promiseand took outa
mortgage on a retirement house.Three
years later, Employer refused to honorhis promise
to pay Employeethe$10,000 annual pension.Employer's promise
probablyis:
a.
Notbindingunlesstheagreementwasinwriting;suchanagreementissubject
tothe StatuteofFrauds
becauseitisacontract
thatcannotpossibly
beperformedwithin
1 year.
b. Notbindingbecausethe$100peryeargivenbyEmployee
isinadequateconsiderationcomparedto$10,000
annualpension
tobepaidbyEmployer.
c. Notbindingbecausethepensionwastobepaidinthefuture,
thus,therewasno
presentintenttobeboundthatisnecessaryforavalidcontract.
d.
Is binding,
underthe circumstances, if all the
otherelements of a contract are present.

34.
Someonewhorecoversdamagesforbreachofcontract
typicallycanrecover:
a) Onlythosecompensatory
damages/lossesthat
can be proven with reasonablecertainty.

b)
Forall consequences
of the breach,e.g., pain and
suffering, whether or not thedamages
areforeseeable.
c)
Only forforeseeabledamages.
d)
Punitivedamages.

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35.
A orally offeredto
sell B 100 premium-grade blue ink ballpoint pens, but neglected to state theprice. B accepted via letter. A
received theacceptance letter, butimmediately thereafter,A tried to get out
of thedeal. Assumethat A and
B are bothmerchants,as defined under the UCC. Atthis pointwhich of the followingis mostlikely to be true about thisagreementbetween
AandB?
a) There is no valid contractbecause
the offeris tooindefinite.
b)
Thereisnovalidcontractbecause
anyofferforthesaleofgoodsmustbeinwriting
and signed by bothparties.
c)
Thereisavalid,enforceablecontract.
d)
Thereisavalid,enforceablecontractonlyifeitherAorBareengaged
ininternational businesswhichmakestheagreementsubjecttoCISG(Contract
forInternationalSaleof
Goods)rules.
36.
Leon,a bank vice president,joined FitnessCenter, Inc. (FC). He
signeda contract stating,among
other things,an exculpatoryclause that FC…“shall notbeliable
forany claim, demand, cause of actionof any kind whatsoever for,or on account
of death, personal injury, propertydamage
or lossof any kindresulting from or related toMember’s useof facilitiesorparticipationinanysport,exercise
oractivitywithin
theclubpremises…”
Leon sustainedhead
injuries when a treadmill on which he was walking collapsed at FC. Leon sued FC forhis injuries.The
court mostlikely willrule:
a)
InfavorofLeonbecause
theexculpatoryclause
isagainstpublicpolicy.
b)
InfavorofLeonbecause
theexculpatoryclauseistoobroadinscope.
c) In
favorofFCbecause
theexculpatoryclauseisnotunconscionableunderthecircumstances.
d)In favorof FC because it had a valid enforceable contract withLeon as Leon knowingly
signed thecontract.
37.
Supermarket offeredto
buy1000 boxesof yogurt fromFoods
Co. The offerdid not statea specific deliverydate. 9 weeks later, Supermarketstill had notheard from Foods, norhad Foods shipped
the goods. Atthis point,Supermarket:
a)
Can do nothing butwait
to hear an acceptance or rejection fromFoods
before Supermarketcan revoke theoffer.
b) Can assume
that Foods does not intend toaccept
the contractand is free to buyto yogurt from another supplier.
c)
Mustacceptthegoods
whentheyarrive,
unlessSupermarkethasrelocated.
d)
MustacceptthegoodswhentheyarriveunlessFoodshasclearly
rejectedtheoffer.

38.
Ed and Norasigned a
contractthat included a statement, “Noevidence of oral negotiationsmay be used to change the termsof this contractual writing.”
Later Ed sued Nora fora breach of contract.In court, Nora testified that shedid notbreach their agreement because, after signingthe written contract, sheand Ed orally agreed to change the contract terms. Nora’s testimonywill:
a)
Beadmittedbythecourtasevidence
thatNoradidnotbreach
thecontract.
b) BeadmittedasavalidexceptionundertheParolEvidenceRule.
c) BeadmittedifNoraisaminorbecause
theParolEvidence
Ruledoesnotapplyto
contracts withminors.
d) Notbe admitted under the ParolEvidenceRule.

39.
A city ordinance permits
street vendorsto operate only withincertain commercial
areas of the cityto prevent dangerous traffic congestion. Thestreet vendorssued thecityclaiming
thattherestrictionswereaviolationoftheirequalprotectionrightsasother businessesarenotrestrictedtooperating
onlyincertaincommercialareaswithinthecity.

Howwould you classify theordinance?

a.
Constitutional;becausethecityhasajustifiablepurposeinenacting
theordinance,it doesnotviolatetheequal
protectionrightsofstreetvendors.
b.
Constitutional;becausestreetvendors
areprivatebusinesses,theyarenotprotectedby theequal protectionclause
of the14thAmendment.
c.
Unconstitutional;theordinance
unduly discriminates againststreetvendorsas
compared
tootherbusiness
ownersandthus,violatesthevendors’equalprotection
rights.
d. Unconstitutional;privately
owned vendors, unlikepublic businesses, havea constitutionalrighttoconduct
businessinanycommercialareaoftheirchoice.
40.
Charlie Customer boughtan
airline ticketon BartAir through TinaTravel Agent.Identifythelegal
relationshipofCharlie,BartAirandTinaregardingthistransaction.
a)
Charlieistheprincipal;TinaishisagentrepresentinghimwithBartAir.
b)
BartAiristheprincipal;Tinaisitsagentinthesaleoftheairline
tickettoCharlie.
c)
TinaisnottheagentofBartAir
orCharlie,butTina’s
employer,thetravelagency,
is
theagent forCharlie.
d)
Tinais
theagent for both BartAirand Charlie.
Essay =60points: YOUMUST ANSWER ALL5ESSAYS
1.
Refertothescenario
forMultipleChoicequestions24-25abovetoanswer
thefollowingessay question#1only:
JonessuedWorldHotels,
Inc.fornegligencetorecoverdamages
forhisinjuriesresulting
fromthefall in theCabo
Mar hotel.Will Joneslikely be successfulin thenegligence
lawsuit against World Hotels? Explain fully why or why not. What elements must
be proven by the Plaintiff in order to prevail? What defensesexist?

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The issue in this case is whether or not each of the
defendants, severally or jointly, is liable for negligence. Jennifer Travels
(senior) is likely to be held negligent for allowing a minor to sign a
contract, thus potentially nullifying it. It is possible Jennifer Senior may
also be criminally liable for fraud and Jones should consider that. Windell
Travel had an exclusive contract with Jennifer Travels (senior). One presumes
that they re-did the contract with Jennifer Jr. If not, that contract would not
be valid because the company is listed as a sole proprietorship.
Windell
Travels and Windell Hotels will undoubtedly bring suit against Jennifer Travels
(Senior) for the cost of the whole shebang, for negligently and fraudulently
collecting monies on an illegal contract and putting them in this position.
Windell Hotel is likely to be liable for the initial fall and medical care (but
not the flight to the US immediately after surgery, because that was personal
choice). That issue of negligence will be separate from contract issues.
Windell Hotels might consider suing Windell Travels because of their negligent use
of Jennifer Travels (Senior) as their agent. That would be one way to spread
any possible loss a little thinner for tax purposes.
Because
I like to consider every possibility, I believe that Windell Hotels should use
the defense to negligence that Jones was in such a snit he failed to take
ordinary care crossing the lobby and failed to see the sign that he should
reasonably have seen. Marble, after all, is slippery always, not just when
being washed.
Although
I don’t think the parties will prevail against Jennifer (Junior) she should be
included as an additional party, to cover all the bases.
Finally,
Jennifer (senior and junior), and Windell Travel and Windell Hotels should sue
the newspapers and their parent chain
who posted the initial ad, saying that the newspaper should have known the
rules about disclaimers and made the text bigger so that it met UCC
requirements. Always follow the deep pockets.

2.
Clarkson and Lee did not
havea contract, butClarkson
completed extensivelandscapinginLee’syardbymistakewhile
Leewasawayonvacation.ClarksonsentLee abillforthelandscapingservicebutLeerefusedtopay.
DeterminethelikelyresultifClarksonsuesLeetorecoverthecostsofthelandscaping.
Wouldtheoutcomebedifferent
ifLeewassitting
onthebackporchdrinking
sweettea while he watched
Clarkson do the work?Why?

3.
Dan,Fran and Stan wantto establisha
bikesales and rentalshop.
Dan and Fran will be actively involved
in managing the business operations,
and Stanis investing mostof the money. The3 want to use
a formof business organizationthat will givelimited liability to each of them. Discusswhat would be the best type of business organizationto
limittheir liability,andwhy?Whataretheadvantagesanddisadvantagesofthatform?

4.
Fran, Joe, and Mike formed
a general partnershipto operatea flower shopcalled Fresher Flowers. One
of Fran’s jobsis to make
deliveries using the partnership truck.In
one
suchdelivery,Frannegligentlyranastopsign,strikingacardriven
byPeggy,causing
damagetothecarandinjurytoPeggy.
Analyzeand describe (1) the personalliability of Fran, Joe, and
Mike, (2) theliability of the
partnership,FresherFlowers.

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5.
Ted was hired by In Flite, Inc. to purchasean airplane on itsbehalf. Without mentioning
that he was makingthepurchase
on behalf of theprincipal,
In Flite, Ted bought
a Cessna310 from Sam. 2 weeks later, In Flite declared bankruptcyand cannot now buy theairplane. Compareand contrastIn
Flite’s liability under the contractto
purchasetheCessnawithTed’s
liabilityunderthecontracttopurchase
theCessna.

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