1) Which of the following is a distinguishing feature of a common law legal system?
A. An appeal process
B. The making of law by the judges and the following of precedent
C. The sole source of law is a comprehensive civil code
D. Requiring guilt be proven beyond a reasonable doubt
2) Which of the following is true about litigating commercial disputes?
A. A few states have established specialized trial courts for commercial disputes.
B. Businesses generally dislike the concept of specialized trial courts for commercial disputes because the large numbers of consumers who sue businesses in these courts have led the judges to become generally biased against businesses.
C. Commercial disputes, because of their specialized nature, are first heard at the appellate court level.
D. Nearly all states have specialized trial courts that hear commercial disputes.
3) The school of jurisprudence that believes that free market forces should determine the outcome to lawsuits is:
A. The Critical Legal Studies school
B. The Law and Economics school
C. The Sociological school
D. The Command school
4) Which of the following is true with regards to arbitration?
A. The arbitrator’s decisions are never binding.
B. Many states have adopted the General Arbitration Doctrine in an effort to promote arbitration of disputes at the state level.
C. Arbitrators enter awards after reaching a decision.
D. More formal evidentiary rules are applied to arbitration hearings.
5) This form of alternative dispute resolution allows both parties to see the strengths and weaknesses of both sides of the case.
D. Judicial referee
6) ________ is a form of alternative dispute resolution that is often used when the parties involved do not want to face one another.
7) What is the result of the “effects on interstate commerce” test?
A. Commercial speech protections apply only to speech that has an effect on interstate commerce.
B. Prior to enacting laws, states were required to indentify any effects that the law might have on interstate commerce.
C. The federal government can regulate a business activity that takes place within a single state if the activity has an effect on interstate commerce even though the regulated activity itself does not involve interstate commerce.
D. The federal government can regulate all interstate commerce that actually crosses state lines.
8) If there is an area of interstate commerce that the federal government has not chosen to regulate, the states can:
A. Regulate in that area so long as it first gets the requisite approval from Congress.
B. Not regulate in that area because states cannot pass laws affecting interstate commerce.
C. Regulate in that area so long as the state law does not unduly burden interstate commerce.
D. Regulate without restriction in that area.
9) What are sellers responsible to provide for regarding the assembly of products they sell?
A. Adequate instructions for use of the product
B. Adequate instructions for safe assembly and use of the product.
C. Adequate instructions for safe assembly
10) If a plaintiff voluntarily enters into or participates into a risk activity that results in injury, what is the most likely defense that he or she may use to a defendant’s claim that the plaintiff assumed the risk?
A. Defendant assumed the risk under the “danger invites rescue” doctrine
B. Defendant was negligent per se
C. Contributory negligence
D. Comparative negligence
11) Which of the following is true about comparative negligence and contributory negligence?
A. Comparative negligence is used with intentional torts and contributory negligence is used with unintentional torts.
B. In order to avoid liability for an unintentional tort, the defendant must prove the presence of both defenses.
C. They are two names for the same defense.
D. Comparative negligence allows the plaintiff to make a partial recovery whereas contributory negligence does not.
12) The legal effect of the presence of a superceding event is that:
A. The burden of proof shifts from the plaintiff to the defendant
B. The plaintiff and defendant will share liability
C. The defendant is not liable even if the plaintiff has proved all the elements of negligence.
D. Intent must be proven in addition to elements of negligence
13) Based on the law of product liability, which of the following is correct?
A. A manufacturer should design its products to take into account all possible misuse by the initial purchaser, but need not worry about misuse by other users.
B. A manufacturer should design its products to take into account all possible misuse.
C. A manufacturer should design its products to take into account feasible misuse.
D. A manufacturer need only take into account the intended use of its products.
14) Power Tool Company manufactures table saws. These saws have several safety devices including a permanent blade guard. The guard keeps the user’s hands from touching the blade while it is moving. Ralph buys a Power table saw, but he takes the blade guard off because it inhibits the type of work he wants to do. Later Ralph is injured while using the saw. If the blade guard had been left on, Ralph would not have been injured. Ralph sues Power Tool Co. under a strict liability theory. The best defense that Power could raise based on these facts is:
A. Generally known dangers
B. Assumption of risk
C. Supervening event
D. Misuse of the product
15) Paul purchased a deluxe motorhome from Wide Open Spaces Motorhomes. In a product liability suit against Wide Open Spaces Motorhome Corporation, Paul must show which of the following in order to recover:
A. A defect made the motorhome unreasonably dangerous, leading to an injury.
B. The negligence of Wide Open Spaces led to Paul’s injury
C. Wide Open Spaces was the manufacturer of the motor home and not just a dealer.
D. Paul was not misusing the motorhome when the injury occurred.
16) Mary applied for a permit with a federal administrative agency to operate a business within the boundaries of a popular national forest. The agency grants a limited number of these permits that allow operation of the business during the busy tourist season. The agency has turned down Mary’s application even though she received a permit in the prior year, paid the related fees on time, and violated none of the permit’s conditions. The agency granted a permit to a different applicant who had never run this type of business previously. If Mary appeals the decision to a court, what standard of review will it most likely use?
A. The unwarranted by the facts test
B. The substantial evidence test
C. The arbitrary and capricious abuse of process test
D. The unfair results test
17) Which of the following statements best describes the procedures under the Clean Air Act?
A. The federal government sets the standard; the state government enforces the standards; if the state governments do not adequately enforce the standards, the federal government may enforce them.
B. The state governments set and enforce the standards.
C. The federal government sets and enforces the standards
D. Both the federal and state governments set standards and each enforces its own standards.
18) Unfair and deceptive trade practices are general regulated by the:
A. Securities and Exchange Commission
B. Food and Drug Administration
C. Federal Trade Commission
D. Consumer Product Safety Commission
19) George, an employee, breaches a fixed-term employment contract by quitting before the end of the term. What can his employer, MNO Inc. recover as damages?
A. Only amounts paid to the employee for which the employee has not yet done the work.
B. All amounts already paid to the employee under the contract.
C. Nothing, because courts do not order anyone to perform a job against his or her will.
D. The costs of hiring a replacement employee plus any increase in salary paid to the replacement employee.
20) Which of the following is correct regarding a counteroffer?
A. It operates as both an offer and acceptance.
B. It is not really an offer, but operates as the revocation of an offer.
C. It is no different from any other offer.
D. It is treated as both a rejection of an offer and a new offer.
21) Mary, the seller, and Jane contract for the sale of 500 sweaters. They agree on color and style, but not on price or time of delivery. Mary refuses to deliver the sweaters and Jane sues. What results?
A. Mary wins; the courts will fill in many missing terms, but never price.
B. Jane wins; the courts will fill in all the above-mentioned missing terms.
C. Mary wins; because all these terms were omitted from the agreement, the contract is not definite enough to be valid.
D. Mary wins; the courts will fill in many missing terms, but never time of delivery.
22) If a judge rules that a party lost its case because of the Statute of Frauds, the judge has essentially stated which of the following?
A. The losing party cannot enforce an oral contract that should have been in writing.
B. The losing party will not be allowed to introduce evidence to contradict a written agreement.
C. The losing party purposely deceived the other party about a material fact.
D. The losing party was found by the court to have lied, and therefore will lose the case.
23) John is president and sole shareholder of Photo, Inc. Photo, Inc. wishes to borrow money, but to do so, the bank requires John to orally guarantee to repay the loan if Photo, Inc. cannot. John’s guaranty to repay is:
A. Unenforceable, because in general, guaranty contracts need to be in writing.
B. Enforceable, because the main purpose of the loan and the guarantee was to benefit John.
C. Enforceable, because in general, guaranty contracts do not need to be in writing.
D. Unenforceable, because John did not sign any agreement.
24) A contract for the sale of land:
A. Must be in writing to be enforceable.
B. Must be in writing only if the value of the land exceeds $500.
C. Requires at least two promisors.
D. Is governed exclusively by the Uniform Commercial Code.
25) Under the Anti-Cybersquatting Consumer Protection Act, which of the following is true?
A. A plaintiff must show that the defendant acted in bad faith in order to recover.
B. Prior approval by the affected celebrity is needed to obtain a domain name that is similar to a celebrity’s name.
C. Penalties are imposed for obtaining any domain name that infringes on a valid trademark.
D. Domain names are granted only after ensuring that they do not infringe on a valid existing trademark.
26) Under the Uniform Computer Information Transactions Act, tender of performance is:
A. The offer to complete the performance of contractual duties made by a party who is willing and able to perform.
B. A party’s unequivocal indication of intent to perform.
C. A party’s agreement to perform
D. The actual completion of a party’s obligations under the contract.
27) Licensing of informational rights can best be described as:
A. The granting of limited rights to use that cannot be simultaneously granted to others.
B. A sale of underlying intellectual property rights.
C. A lease of tangible personal property to the licensee.
D. The granting of any rights to use information, which can differ greatly in scope and duration.
28) Which is true about the two kinds of discrimination that are actionable under Title VII?
A. Disparate impact refers to individuals and disparte treatment refers to protected classes.
B. Disparate impact and disparate treatment are both based on how the employer treats a specific individual.
C. Disparate treatment refers to individuals and disparate impact refers to protected classes.
D. Disparate impact and disparate treatment are both based on how the employer treats a protected class.
29) Which is true if someone believes he was fired from a job because of his religion?
A. He will not have a claim if the employer has a disproportionately high number of employees of the same religion.
B. He must prove that the person who fired him is of a different religion.
C. He must first file a complaint with the Equal Employment Opportunity Commission or an equivalent state agency prior to being able to file a suit in court.
D. He must prove that he is a reasonably active practitioner of his religion.
30) In a hostile work environment sexual harassment claim, the employer will have a successful defense if the employer can show which of the following?
A. There were no adverse consequences to the employee’s work status, such as demotion or denied promotion.
B. The employer took reasonable care to prevent or correct the conduct and the employee did not take advantage of corrective or preventative opportunities of the employer to remedy the situation.
C. The employee was offended by conduct that the employer in good faith did not consider to be offensive.
D. The employee stands to personally gain if the persons engaging in the sexual harassment are reprimanded.
31) Under the Occupational Safety and Health Act, which of the following is true?
A. Complaints are handled by the Equal Employment Opportunity Commission.
B. Purchasers of a company’s products are assured they are safe for use in the home.
C. A company can be found to be in violation even if a specific safety regulation is not violated.
D. Very few safety standards have actually been adopted.
32) The primary goal of establishing workers’ compensation systems is:
A. To discourage workers from filing frivolous claims relating to workplace injuries
B. Provide more certain method for employees to recover for workplace injuries
C. To protect the court system from being burdened with lawsuits relating to workplace injuries
D. To prevent injuries in the workplace
33) Minimum wage, hours of employment, and child labor are regulated by the:
A. Federal Employment Act of 1940
B. Right to Work Laws
C. Regulated Hours Act
D. Fair Labor Standards Act
34) Which of the following is true when someone accidentally makes an improvement to the personal property of another where the owner was unaware of the improvement until after it had been made?
A. The party who made the improvement can remove it if this is possible, otherwise the owner of the property gets to keep the improvement and is not required to pay for it.
B. The property owner gets to keep the improvement in all circumstances and is not required to pay for it.
C. The property owner gets to keep the improvement in all cases, but must pay the party who improved it the reasonable value of the improvement.
D. The party who made the improvement can remove it if this is possible, otherwise the owner of the property gets to keep the improvement and must pay the party who improved it the reasonable value of the improvement.
35) George, an employee, breaches a fixed-term employment contract by quitting before the end of the term. What can his employer, MNO Inc. recover as damages?
A. Only amounts paid to the employee for which the employee has not yet done the work.
B. Nothing, because courts do not order anyone to perform a job against his or her will.
C. All amounts already paid to the employee under the contract.
D. The costs of hiring a replacement employee plus any increase in salary paid to the replacement employee.
36) A bailment is:
A. Required to be in writing in order to be effective
B. Usually the preliminary step to a permanent transfer of goods
C. The rightful possession of goods by someone other than the owner
D. Characterized by a splitting of title into legal and beneficial components
37) Which of the following is true about misappropriation of trade secrets?
A. The plaintiff can recover only if the defendant acquired the secret through illegal means.
B. Injunctions are generally not available to protect trade secrets.
C. Although it is not necessary that the trade secret be patented, the secret must be such that it could be patented.
D. Trade secrets are protected regardless of the actions of the trade secret owner.
38) What is the major convention that provides international protection to patents?
A. The General Agreement on Tariffs and Trade (GATT)
B. The Paris Convention
C. The Berne Convention of 1886
D. The 1997 WIPO Treaty
39) What was accomplished by the Visual Artists Rights Act?
A. Copyright protection for visual artwork no longer needed a copyright notice.
B. Artists retained certain rights to limit the reproduction and modification of their works even if the work or copyright is old.
C. Copyright protection was extended to visual creative works.
D. The fair use doctrine was eliminated with respect to visual works of art.
40) How does an easement appurtenant differ from an easement in gross?
A. The dominant estate of an easement appurtenant is adjacent to the servient estate.
B. An easement appurtenant must be recorded.
C. An easement appurtenant is in writing.
D. An easement appurtenant is permanent
41) Which of the following would prevent someone from acquiring land by adverse possession?
A. The person lived on the land without the original owner’s permission.
B. The person was the only person who lived on the land in question.
C. The person never had to fight the original owner in order to remain on the land.
D. The person lived on the land secretly so that the original owner would not find out he or she was there.
42) The landlord has the right to enter the leased premises:
A. To inspect for waste
B. To inspect for illegal use
C. Only if specifically provided in the lease
D. To make necessary repairs
43) If a corporation is properly incorporated in one state and wants to do business in second state, the corporation:
A. Register with the Interstate Corporation Commission.
B. May be required to obtain a certificate of authority from the second state.
C. Must incorporate in the second state.
D. Must do nothing because being incorporated in one state entitles the corporation to do business in all states.
44) If an LLC fails to follow formalities such as keeping minutes of meetings, then which of the following is true?
A. This failure will not result in imposing personal liability on any member.
B. Only the parties responsible for the failure will lose limited liability.
C. Only the managers of a manager-managed LLC will lose limited liability.
D. All members will lose their limited liability.
45) Limited partners can lose their limited liability by:
A. Actively managing the business of the limited partnership.
B. Breaching the fiduciary duty to the limited partnership.
C. Investing too much in the partnership.
D. Withdrawing from a limited partnership contrary to provisions in the limited partnership agreement.
46) The Sarbanes-Oxley Act provides for the establishment of the _____________ to over see audits of public companies. This will be done to protect the interests of shareholders and investors.
A. Accounting Inspection Committee
B. Public Company Accounting Oversight Board
C. Corporate Audit Committee
D. Internal Auditing Investigation Board
47) The Sarbanes-Oxley Act was enacted as the result of:
A. The failure of the savings and loans in the 1980s.
B. The collapse of the housing market in the late 2000s.
C. The terrorist attacks of Sept 11, 2001.
D. The high profile accounting fraud cases in the 1990s and early 2000s.
48) This is prohibited under the Sarbanes-Oxley Act:
A. Public companies making personal loans to their directors and executives.
B. Directors and executives attending board meetings on a regular basis.
C. High salaries for corporate executives.
D. Using an independent accounting firm for audit purposes.
49) Which of the following is likely to be a breach of a corporate officer’s/director’s duty of care?
A. Failing to predict the startup of a new competitor.
B. Failing to foresee a severe rise in the interest rate.
C. Failing to anticipate a drop in consumer demand of the company’s product.
D. Failing to make a reasonable investigation of relevant facts.
50) Officers of a corporation typically have which types of agency authority?
A. Express and apparent only
B. Implied and apparent only
C. Express only
D. Express, implied, and apparent
51) Self-dealing by a director of a corporaton can best be described as:
A. A breach of a director’s duty of care.
B. A breach of a director’s duty of loyalty.
C. A duty of the director to use her own expertise whenever possible.
D. A duty of the director to not overly rely on others.