Chapter 4; Business - Business Law

1

Consider this statement: "Non-lawyer ‘legal assistants or paralegals' should be authorized to offer legal services directly to the public.". What are the pros and cons of this proposition?

2

Under Article 3 of the UCC, a check is:

3

Who has settlement authority in a minitrial?

4

Vertical maximum price fixing is generally legal under the antitrust laws

5

Bari deeds Blackacre to Adam, Charlie, and David as joint tenants with the right of survivorship. Adam then sells his interest in Blackacre to Sally. Soon after, Charlie dies. Who now owns Blackacre? In what form(s)? Discuss.

6

Explain how worker's compensation in the U.S. works

7

Theresa agrees to mow Huan's yard for $300 for the summer. Huan wishes to assign the contract to his grandmother. Theresa objects because Huan's yard is very small while his grandmother's yard is over an acre. Which of the following is the correct legal outcome for the dispute between Theresa and Huan?

8

An implied warranty of fitness for a particular purpose is breached if the goods do not meet the buyer's or lessee's expressed needs

9

Restrictions on imports may include tariffs.

10

Mary contracted to buy 100 table lamps. Under the terms of the agreement, Mary is to pay for the lamps upon delivery. This is an example of a

11

To be valid, an agency agreement must be in writing

12

In contracts involving a carrier, a seller can complete performance through a shipment contract or a destination contract.

13

Sound Financials Corporation sends daily e-mail ads to its previous customers and those who have opted to receive the notices.Instable Investments, Inc, sends e-mail ads to any e-mail address that Instable can find on the Web or otherwise generate. Far & Wide Corporation uses the trademark of Google Inc in a meta tag without Google's permission. This is A) cybersquatting

14

________ property is a resource that you own as an individual.

15

What is insider trading?

The definition of insider trading is trading by shareholders who hold private inside information that would materially impact the value of the stock and that allows them to benefit from buying or selling stock. Illegal insider trading also occurs when corporate insiders provide "tips" to family members, friends, or others and those parties buy or sell the company's stock based on that information. "Private information" would include privileged information that has not yet been released to the public. That information is deemed material if it could possibly have a financial impact on a company's short- or long-term performance or if it would be important to a prudent investor in making an investment decision.
Insider trading may also be based on a claim of unethical misappropriation of proprietary knowledge, that is, knowledge only those in the firm should have, knowledge owned by the firm and not to be used by abusing one's fiduciary responsibilities to the firm. Insider trading is considered patently unfair and unethical because it precludes fair pricing based on equal access to public information. If market participants know that one party may have an advantage over another via information that is not available to all players, pure price competition will not be possible and the faith upon which the market is based will be lost.

16

Answer the following statement(s) true (T) or false (F)

17

Fleet Trucking Inc transports hazardous waste. Gary is a Fleet driver. The company knows that Gary drives longer hours than federal regulations permit. One night, he exceeds the limit and has an accident near Home City. Spilled chemicals contaminate the

18

Ethical lapses involve gradual decision processes

19

Nikita operates a sole proprietorship, a corporation, and a partnership. Nikita wants to obtain relief for her individual debts and the debts of her corporation and partnership. For each of these, Nikita may file a petition in bankruptcy for relief through

20

The Brooks Peanut Co. v. Great Southern Peanut LLC case involved an issue of

21

Which of the following statements is true with regard to termination of liability?

22

A decision of an appeals court in Minnesota would be recorded in the:

23

Past actions that were not bargained for by the parties can become valid consideration for a contract

24

Answer the following: a. Who selects the officers of a corporation under most state corporate statutes? Who removes them? Explain. b. What duties do the officers and directors of a corporation owe to the corporation? Explain

a.
Under most state statutes, the officers of a corporation are both selected and removed by the board of directors. Though shareholders can voice their disapproval in a particular officer, the only people with the authority to select and remove officers are board members acting as a unit.

b. Directors and officers owe the duties of obedience, diligence, and loyalty to the corporation. The duty of obedience means directors and officers must act within their respective authority. In most states the duty of diligence requires the discharge of duties in good faith, with the care an ordinarily prudent person in a like position would exercise under similar circumstances, and in a manner she reasonably believes to be in the best interests of the corporation. The duty of loyalty is a fiduciary duty to the corporation and to its shareholders. Directors and officers must subordinate self-interest to the interest of the corporation. Directors are expected to attend board meetings and become informed on corporate matters. Officers and directors must disclose fully any corporate opportunity or any possible conflict of interest that may arise in any transaction. Over and above all these duties, officers have the duty of managing daily business affairs in the corporation's best interest.

25

List the services that the Sarbanes-Oxley Act prohibits accounting firms from performing for audit clients

26

Shares issued through reorganizations must be registered

27

Considerations can only be monetary or economic in nature

28

Assumption of risk is a defense to the tort of negligence

29

Because market power arises from access to consumer data, collecting such information is an antitrust violation.

30

The clearance and settlement procedure is uniform throughout the world

31

Brewster, the chief executive officer of Cog & Gear Lubricants Corporation, wants to ensure that Cog & Gear's activities are legal and ethical. The best course for Brewster and Cog & Gear is to act

32

A person cannot be both an independent contractor and an agent.

33

The Environmental Protection Agency can prohibit altogether a toxic substance that poses an imminent hazard.

34

A federally protected trademark can be "abandoned" and lose protection through non-use

35

Star Flights Inc. launches exploratory and commercial space flights from its base in the United States. In the event of a collision with other space objects, under the Outer Space Treaty, liability for injury or damage

36

What is true about union formation?

37

[Lead paint] Alessia grew up in an old house. When Alessia was 25 years old, she was diagnosed with permanent kidney and nervous system damage, which doctors determined was linked to the lead paint she chipped off her windows and digested when she was a younger child. In order to offset some of the continuing medical costs, Alessia wants to sue the lead paint manufacturer, however, she doesn't know what brand of paint was used in her home. The most popular brand of lead paint in her area at the time the interior of her house was painted was made by ColorCo, but PaintCo and BrightCo were significant producers also with PaintCo having sales just behind ColorCo.Can Alessia sue only ColorCo, the largest lead paint manufacturer who manufactured the type of paint in her home, even though there

38

Julie is sales manager for Kelso's Concrete & Stone Products, Inc. In applying ethical principles to the business of the firm, Kelso's and Julie will most likely evaluate

39

An agent is always liable for his or her own torts committed within the scope of the agency relationship

40

Identify and discuss the exceptions to the warrant requirement

•    A law enforcement officer may arrest a person without a warrant when that person is in the process of committing a misdemeanor. This "caught-in-the-act" exception allows officers to respond quickly to lesser crimes in progress without having to leave the scene.
•    Officers may arrest a person without a warrant when they have probable cause to believe he or she has committed a felony.
•    Exigent circumstances arise when a situation requires immediate or unusual actions. Such situations do not allow time for the officer to obtain a warrant. Exigent circumstances include destruction of evidence, mobility of the suspect (such as being in a car), or the presence of weapons at a crime scene. The officers must have probable cause and they
•    A related warrant exception is hot pursuit. When an officer is actively involved in chasing down a suspect, just because the suspect enters a building does not mean that the officer must stop and get a warrant. The officer may enter the building to continue his or her pursuit of the suspect.
•    Another search warrant exception is the plain-view doctrine. An officer may seize any contraband (items that are illegal), such as cocaine. However, the officer must legally be in sight of the items to seize them. For example, if an officer illegally entered a house and found cocaine lying on the kitchen counter, that seizure of the cocaine is illegal because the officer did not have the legal right to be in a position to see the cocaine.

41

A complainant may file his or her employment discrimination claim with the ________ instead of the EEOC.

42

Joe walks up behind Mary while at work. Joe grabs Mary and caresses her. Mary thinks Joe is a jerk and has never encouraged him. She runs away. Mary could sue Joe for the tort of:

43

Steve Templeton, the CEO of Rolland Motor Company, is contemplating the shutdown of a plant in Kantron. The plant has been unprofitable for some time now, and there is an increasing pressure from shareholders to shut it down so as to balance the loss being incurred by the shareholders. Closing the plant would result in the employees losing their jobs and the local suppliers losing a major buyer. It will also have an adverse effect on the community of Kantron as the plant is one of the main sources of employment for the locals. Steve considers all these factors before deciding the fate of the plant. After considering all the factors, if Steve finds that the loss to the employees and the community is far greater than that incurred by the shareholders and decides to keep the plant open,

44

A. Is employment discrimination based on sex prohibited by federal law? Explain. b. Can an employer refuse to hire a married woman for a job? Explain. Can an employer refuse to hire a pregnant woman for a job? Explain. Can an employer fire a single woman because she is pregnant? Explain

45

In order for Johanna to receive a permit for her plastic factory in a nonattainment area, she must show that the factory's emission rates will be within the average range for the industry

46

The state of Ohio can regulate building contractors and building codes in the state under its

47

Corporations and other business entities receive the same level of constitutional protection as individuals.

48

If a shareholder borrows money and delivers stock as collateral security, the creditor has a perfected security interest in the stock without any filing by the creditor

49

Bill and Charlene enter into a contract for the clearing, plowing, and preparing of Charlene’s 100-acre tract for which she agrees to pay $1,000. Bill transfers his duty under this contract to Dewey. With respect to the duties under the original contract, this transfer