Question 1

Unlicensed persons cannot recover payment for services where he or she does not have the required license.

Accepted Answer

A) True 
 B)False  True

Question 2

What are licensing statutes?

Accepted Answer

All states have licensing statutes that require members of certain professions and occupations to be licensed by the state in which they practice.In most instances, a license is granted to a person who demonstrates that he or she has the proper schooling, experience, and moral character required by the relevant statute.Sometimes, a written examination is also required.Some statutes expressly provide that unlicensed persons cannot enforce contracts to provide these services.

Question 3

What are gambling statutes?

Accepted Answer

All states either prohibit or regulate gambling, wagering, lotteries, and games of chance via gambling statutes.States provide various criminal and civil penalties for illegal gambling.There are many exceptions to wagering laws.Many states have enacted statutes that permit games of chance under a certain dollar amount, bingo games, lotteries conducted by religious and charitable organizations, and the like.Many states also permit and regulate horse racing, harness racing, dog racing, and state-operated lotteries.

Question 4

Which of the following is true of a contract with an adjudged insane person?

Accepted Answer

A) The adjudged insane person is bound by the terms of the contract. 
B) The contract is void. 
C) Only the competent party can enforce the contract. 
D) The competent party is legally obligated to uphold the contract. 
A) The adjudged insane person is bound by the terms of the contract. 
B) The contract is void. 
C) Only the competent party can enforce the contract. 
D) The competent party is legally obligated to uphold the contract.

Question 5

A minor may not affirm one part of a contract and disaffirm another part.

Accepted Answer

A) True 
 B)False

Question 6

________ is a rule that states that a minor is obligated only to return the goods or property he or she has received from the adult in the condition it is in at the time of disaffirmance.

Accepted Answer

A) Duty of restoration 
B) Duty of restitution 
C) Infancy doctrine 
D) Emancipation doctrine 
A) Duty of restoration 
B) Duty of restitution 
C) Infancy doctrine 
D) Emancipation doctrine

Question 7

If both parties to a contract are minors, both parties have the right to disaffirm the contract.

Accepted Answer

A) True 
 B)False

Question 8

What is legal insanity?

Accepted Answer

The law protects people suffering from s

Question 9

In which of the following situations would the effect of illegality be an exception?

Accepted Answer

A) when both parties of an illegal contract execute their agreements 
B) when both parties of an illegal contract are considered in pari delicto 
C) when person is justifiably ignorant of the law or fact that made the contract illegal 
D) when a person completes his act of an illegal contract but is not paid for his consideration. 
A) when both parties of an illegal contract execute their agreements 
B) when both parties of an illegal contract are considered in pari delicto 
C) when person is justifiably ignorant of the law or fact that made the contract illegal 
D) when a person completes his act of an illegal contract but is not paid for his consideration.

Question 10

Any contract entered into by a person who has been adjudged insane is void.

Accepted Answer

A) True 
 B)False

Question 11

Damien, a first-year law student, offers his services to Mr.Jenkins to help draft his will.Mr.Jenkins agrees to Damien's offer, and promises to pay him $400 for his services.Damien completes the draft of the will.But when Damien goes to collect his payment, Mr.Jenkins refuses payment.Damien knew that he had no legal recourse to enforce the contract.What statute had Damien violated in his contract with Mr.Jenkins?

Accepted Answer

A) revenue-raising statute 
B) regulatory licensing statute 
C) usury statute 
D) ratification statute 
A) revenue-raising statute 
B) regulatory licensing statute 
C) usury statute 
D) ratification statute

Question 12

The infancy doctrine binds an adult to the minor's decision on a contract.

Accepted Answer

A) True 
 B)False

Question 13

________ is the act of a minor to rescind a contract under the infancy doctrine, either orally, in writing, or by the minor's conduct.

Accepted Answer

A) Ratification 
B) Disaffirmance 
C) Sanction 
D) Adherence 
A) Ratification 
B) Disaffirmance 
C) Sanction 
D) Adherence

Question 14

Which of the following elements has to be proved for a contract to be deemed unconscionable?

Accepted Answer

A) that the weaker party did not enter the contract under duress 
B) that the parties had equal bargaining power 
C) that the dominant party justly used its bargaining power 
D) that the adhering party had no reasonable alternative 
A) that the weaker party did not enter the contract under duress 
B) that the parties had equal bargaining power 
C) that the dominant party justly used its bargaining power 
D) that the adhering party had no reasonable alternative

Question 15

The state of Transas has set a maximum interest rate of 12 percent on loans.Matt borrows $10, 000 from Tony to pay off a gambling debt.Both are residents of Transas.They sign a contract, which states that Matt would have to pay $1, 500 as interest in one year to pay off the loan.Later Matt finds out the state usury limit and sues Tony.What is the nature of the contract between Matt and Tony?

Accepted Answer

A) It is illegal as it violates gambling statutes. 
B) It is legal as both parties were competent when the contract was signed. 
C) The contract is void as it violates usury laws. 
D) The contract is void as it is a contract to commit a crime. 
A) It is illegal as it violates gambling statutes. 
B) It is legal as both parties were competent when the contract was signed. 
C) The contract is void as it violates usury laws. 
D) The contract is void as it is a contract to commit a crime.

Question 16

How is the doctrine of unconscionability related to public policy?

Accepted Answer

A) The doctrine of unconscionability is derived from public policy. 
B) All contracts contrary to public policy are considered unconscionable. 
C) Both are used to save a contracting party from a bad bargain. 
D) Both are very distinctly defined by law. 
A) The doctrine of unconscionability is derived from public policy. 
B) All contracts contrary to public policy are considered unconscionable. 
C) Both are used to save a contracting party from a bad bargain. 
D) Both are very distinctly defined by law.

Question 17

Lenders can charge interests set higher than the state limit.

Accepted Answer

A) True 
 B)False

Question 18

Darren is a certified interior designer with a lucrative client list in the city of Kelsa, situated in the state of Touslon.His business affords him a substantial amount of goodwill from his clients.Darren sells his accounting interior designing business to Glenda.When he sells his business to Glenda, Darren agrees not to open another interior designing firm in the city of Kelsa for a 25-year period.
-Which of the following aspects of the contract would the courts find reasonable?

Accepted Answer

A) the line of business protected 
B) the geographic area protected 
C) the duration of the restriction 
D) the restriction of employment 
A) the line of business protected 
B) the geographic area protected 
C) the duration of the restriction 
D) the restriction of employment

Question 19

Darren is a certified interior designer with a lucrative client list in the city of Kelsa, situated in the state of Touslon.His business affords him a substantial amount of goodwill from his clients.Darren sells his accounting interior designing business to Glenda.When he sells his business to Glenda, Darren agrees not to open another interior designing firm in the city of Kelsa for a 25-year period.
-What kind of agreement exists between Darren and Glenda in this case?

Accepted Answer

A) contract in restraint of trade 
B) covenant not to compete 
C) unconscionable contract 
D) quasi-contract 
A) contract in restraint of trade 
B) covenant not to compete 
C) unconscionable contract 
D) quasi-contract

Question 20

What is the significance of the age of majority in relation to legal contracts?

Accepted Answer

A) People below the age of majority can directly enter into lawful contracts. 
B) Mentally incompetent persons need to achieve the age of majority in order to enter into a legal contract. 
C) It is the age above which people of capacity can enter into a legal contract. 
D) Minors who have entered the age of majority require his or her parents or guardian's consent to enter into a legal contract with adults. 
A) People below the age of majority can directly enter into lawful contracts. 
B) Mentally incompetent persons need to achieve the age of majority in order to enter into a legal contract. 
C) It is the age above which people of capacity can enter into a legal contract. 
D) Minors who have entered the age of majority require his or her parents or guardian's consent to enter into a legal contract with adults.

Exam 12: Capacity and Legality

Unlicensed persons cannot recover payment for services where he or she does not have the required license.

What are licensing statutes?

What are gambling statutes?

Which of the following is true of a contract with an adjudged insane person?

A minor may not affirm one part of a contract and disaffirm another part.

________ is a rule that states that a minor is obligated only to return the goods or property he or she has received from the adult in the condition it is in at the time of disaffirmance.

If both parties to a contract are minors, both parties have the right to disaffirm the contract.

What is legal insanity?

In which of the following situations would the effect of illegality be an exception?

Any contract entered into by a person who has been adjudged insane is void.

The infancy doctrine binds an adult to the minor's decision on a contract.

________ is the act of a minor to rescind a contract under the infancy doctrine, either orally, in writing, or by the minor's conduct.

Which of the following elements has to be proved for a contract to be deemed unconscionable?

How is the doctrine of unconscionability related to public policy?

Lenders can charge interests set higher than the state limit.

What is the significance of the age of majority in relation to legal contracts?

Legal Heritage and the Digital Age

Courts and Jurisdiction

Judicial,Alternative,and E-Dispute Resolution

Constitutional Law for Business and E-Commerce

Intentional Torts and Negligence

Product and Strict Liability

Intellectual Property and Cyber Piracy

Criminal Law and Cyber Crimes

Nature of Traditional and E-Contracts

Agreement

Consideration and Promissory Estoppel

Genuineness of Assent and Undue Influence

Statute of Frauds and Equitable Exceptions

Third-Party Rights and Discharge

Remedies for Breach of Traditional and E-Contracts

E-Commerce and Digital Law

Formation of Sales and Lease Contracts

Title to Goods and Risk of Loss

Remedies for Breach of Sales and Lease Contracts

Warranties

Creation of Negotiable Instruments

Holder in Due Course and Transferability

Liability, Defenses, and Discharge

Banks, E-Money, and Financial Reform

Credit,Mortgages,and Debtor's Rights

Secured Transactions and E-Filing

Bankruptcy and Reorganization

Agency Formation and Termination

Liability of Principals, Agents, and Independent Contractors

Employment, Worker Protection, and Immigration Law

Labor Law and Collective Bargaining

Equal Opportunity in Employment

Small Business, Entrepreneurship, and General Partnerships

Limited Partnerships and Special Partnerships

Corporate Formation and Financing

Corporate Governance and the Sarbanes-Oxley Act

Corporate Acquisitions and Multinational Corporations

Limited Liability Companies and Limited Liability Partnerships

Franchises and Special Forms of Businesses

Investor Protection, E-Securities, and Wall Street Reform

Ethics and Social Responsibility of Business

Administrative Law and Regulatory Agencies

Consumer Protection and Product Safety

Environmental Protection

Antitrust Law and Unfair Trade Practices

Personal Property and Bailment

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Landlord-Tenant Law and Land Use Regulation

Insurance

Accountants' Duties and Liability

Wills Trusts and Estates

Family Law

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