QUESTION 11
1. Luxury Home Builders has a contract with Ricardo to build a luxury waterfront home for $17 million. The project is complete and fulfills all contract requirements, except the bathroom fixtures that were installed mistakenly were Sears fixtures instead of top-rated, gold-plated, clearly specified, Kohler ones. “My goodness, gracious, Sears,” Ricardo exclaims, when he discovers this! He is very insulted and incensed and refuses to pay a dime! Whereupon, Luxury sues him for breach of contract. The likely result will be:
Ricardo will prevail since the contract was breached as the contract specifications were not fulfilled perfectly.
Ricardo will prevail since his contract duties were completely discharged by Luxury’s breach of contract.
Ricardo will prevail and in addition to compensatory damages be able to cover emotional distress damages too.
Luxury will recover the contract price minus the amount necessary to replace the fixtures since it otherwise substantially performed and the deviation from the contract was caused by mistake.
0.5 points
QUESTION 12
1. Alpha Properties, Inc., makes an offer in a letter to Bob to sell a certain lot for $5,000, with the offer to stay open for thirty days. Bob would prefer to pay $4,000, if Alpha would sell at that price. To leave room for negotiation without reject¬ing the offer, Bob should reply
“I will not pay $5,000.”
“Will you take $4,000?”
“I will pay $4,000.”
“I will pay $4,500.”
0.5 points
QUESTION 13
1. Ann gives Bill the distinct impression that Carol is Ann’s agent, when in fact she is not. Bill deals with Carol as Ann’s agent. Regarding any agency relation¬ship, Ann
can deny it.
can deny it to the extent of any injury suffered by Bill.
can deny it to the extent of any liability that might be imposed on Ann.
cannot deny it.
0.5 points
QUESTION 14
1. Under the employment at will doctrine as a general rule:
either party may terminate the employment relationship at any time and for any reason.
the employer may terminate the employment relationship at any time and for any reason but must pay the employee severance pay
only the employee may terminate the employment relationship at any time and for any reason.
only the employer may terminate the employment relationship at any time and for any reason.
0.5 points
QUESTION 15
1. Rajiv, the owner of a very nice and successful Indian restaurant, House of India, in western Broward County, is going to retire. He plans to sell the business, together with good will and recipes, and with the current staff remaining, to the Patel family, who are new to the restaurant business. Although Rajiv says he is going back to India, the Patel family members are not so sure that Rajiv will return to Florida and open up a competing restaurant business in the near vicinity, thereby drawing back his old customers to the detriment of the Patel family. Accordingly, as part of the contract for the sale of the business, a covenant-not-to-compete clause is included wherein Rajiv promises not to compete directly or indirectly in the Indian restaurant business for two years and in a radius of 10 miles of the House of India. The likely legal effect of this covenant is:
a.
The covenant is illegal and void since it is a restraint of trade in violation of the Sherman Anti-trust Act.
b.
The covenant is illegal and void since it is against public policy, which favors competition.
c.
The covenant is legal since it appears reasonable in time and place.
d.
The covenant is illegal since it seems unreasonable in time and place.
0.5 points
QUESTION 16
1. Seller and buyer orally agree that Seller will manufacture and sell to Buyer 1000 “Success” model calendars at a price of $1000.00. The calendars are to have Buyer’s name and advertising slogan permanently imprinted thereon. After the Seller had completed production but before shipment was made, the Buyer canceled his order. Seller then sues Buyer for breach of contract. The most accurate statement regarding the resolution of this lawsuit is?
A.
Buyer prevails since the Uniform Commercial Code gives a buyer a right to cancel an agreement up to its full performance.
B.
Buyer prevails since the agreement needed to be in writing pursuant to the Uniform Commercial Code’s Statute of Frauds.
C.
Seller prevails due to the “specially manufactured goods” exception to the UCC Statute of Frauds.
D.
Seller prevails since the Buyer likely acted in a fraudulent manner.
0.5 points
QUESTION 17
1. Tomas is a business student with a very good business idea for academia. Tomas, with the help of his school’s entrepreneurship center, then develops a detailed business plan for an academic online course registration system. The faculty at the entrepreneurship center thinks that Tomas’ concept and plan have economic potential and thus are quite marketable. Tomas places on his business plan a Confidentiality statement, and also when he “shops” his plan to potential investors and school administrators he asks them to sign a Non-Disclosure Agreement. Based on the aforementioned facts, which statement is likely TRUE?
a.
Tomas has protected his business plan by means of federal patent law.
b.
Tomas has protected his business plan by means of federal copyright law.
c.
Tomas has failed to protect his business plan by trade secret law since a plan, concept, or idea is too “soft” information, as opposed to a “hard” formula or device, for legal trade secret protection.
d.
Tomas has protected his business plan by means of state trade secret law.
0.5 points
QUESTION 18
1. Beta, Inc., includes a shrink-¬wrap agreement with its products. A court would likely enforce this agreement if a buyer used the product
after having had an opportunity to read the agreement.
before having had an opportunity to read the agreement.
only after actually reading the agreement.
none of the above.
0.5 points
QUESTION 19
1. Omar buys a pre-owned car from Prestige Motors. The contract says that the car is sold “AS IS.” The car leaks oil. Omar wants to sue Prestige for breach of the implied warranty of merchantability. Omar likely will:
Lose if the “AS IS” disclaimer was conspicuous in the contract.
Win since AS IS disclaimers cannot eliminate implied warranties, only express.
Win because the car clearly is a “lemon.”
Win because it would not be fair for manufacturers and retailers to disclaim implied warranties which state legislatures gave to consumers.
0.5 points
QUESTION 20
1. Memorial Hospital hires Large Construction Company to renovate its emergency room. Construction Company submits plans that the Hospital approves. Construction Company completes the major renovation, paints the interior, and supplies the necessary fixtures, equipment, and furnishings. The Hospital, however, rejects some of the furnishings because, due to the lack of oversight of a Construction supervisor, they do not exactly match the plans. The Hospital subsequently refuses to allow Construction Company to finish the work or to collect any payment. Whereupon, Large Construction Company sues for breach of contract. The most accurate statement regarding the resolution of this lawsuit is?
A.
Hospital wins since Construction’s performance was not perfect according to the Perfect Tender rule
B.
Hospital wins Construction’s supervisor was negligent.
C.
Construction wins since Hospital acted in a deceitful manner.
D.
Construction wins and recovers the contract price minus the amount necessary to correct the defects and finish the work pursuant to the Substantial Performance doctrine.
