Question 1

Explain what is meant by a "chose in action."

Accepted Answer

A chose in action is a non-tangible form of personal property where one person has a right or a claim against another that has some value, such a debt.

Question 2

Owen borrowed money from a credit union, guaranteed by his father, to buy a car. The credit union also registered a security interest under the Personal Property Security Act against the vehicle. Owen defaulted and, instead of repossessing the vehicle, the credit union demanded payment from the father. Explain the legal position of the father under these circumstances.

Accepted Answer

The credit union has every right to demand payment from the father instead of repossessing the car. Once the father pays, however, he steps into the shoes of the credit union and has the right to repossess the car and have it sold, just like the credit union did.

Question 3

A "confirmed letter of credit" is another name for a "standby letter of credit."

Accepted Answer

A) True 
 B)False  False

Question 4

Which one of the following statements about bankruptcy is False?

Accepted Answer

A)  Bankruptcy law is identical in every province of Canada. 
B)  Bankruptcy refers to a situation in which a debtor who cannot pay debts transfers his assets to a trustee who acts on behalf of creditors. 
C)  Bankruptcy law may allow a debtor to escape from having to pay his debts. 
D)  All creditors of a bankrupt debtor are treated equally and will receive shares of the assets directly in proportion to how much is owed to each of them. 
E)  A debtor who has been discharged from bankruptcy is released from his previous financial obligations. 
A)  Bankruptcy law is identical in every province of Canada. 
B)  Bankruptcy refers to a situation in which a debtor who cannot pay debts transfers his assets to a trustee who acts on behalf of creditors. 
C)  Bankruptcy law may allow a debtor to escape from having to pay his debts. 
D)  All creditors of a bankrupt debtor are treated equally and will receive shares of the assets directly in proportion to how much is owed to each of them. 
E)  A debtor who has been discharged from bankruptcy is released from his previous financial obligations.

Question 5

What is the effect of a payment made in preference to one creditor over another?

Accepted Answer

The answer of What is the effect of a payment...

Question 6

With regard to bankruptcy and debt collection, which of the following is False?

Accepted Answer

A)  The Bankruptcy and Insolvency Act provides for a procedure for an insolvent debtor to make a proposal to his creditors that may or may not result in bankruptcy for the debtor. 
B)  Both fraudulent conveyance and fraudulent preferences acts attempt to prohibit the debtor from delaying, hindering, or defrauding the creditor. 
C)  Corporations that go into receivership may not be involved in bankruptcy; the receivership may be based on contract. 
D)  The commission of a bankruptcy offence could prevent a bankrupt debtor from being discharged. 
E)  Any assets obtained by a discharged bankrupt can still be claimed by former unsecured creditors who placed the former bankrupt into bankruptcy. 
A)  The Bankruptcy and Insolvency Act provides for a procedure for an insolvent debtor to make a proposal to his creditors that may or may not result in bankruptcy for the debtor. 
B)  Both fraudulent conveyance and fraudulent preferences acts attempt to prohibit the debtor from delaying, hindering, or defrauding the creditor. 
C)  Corporations that go into receivership may not be involved in bankruptcy; the receivership may be based on contract. 
D)  The commission of a bankruptcy offence could prevent a bankrupt debtor from being discharged. 
E)  Any assets obtained by a discharged bankrupt can still be claimed by former unsecured creditors who placed the former bankrupt into bankruptcy.

Question 7

What is the primary remedy available when goods have been used to secure a loan which has been defaulted?

Accepted Answer

Seizure of

Question 8

Owen bought a car from Ace Fancy Cars Ltd. on time. The salesman claimed that it had a new engine and a new transmission. Security was registered against the vehicle under the Personal Property Security Act, and Owen's father was required to sign a guarantee to support the debt. Two months later, the car broke down, and upon inspection, it was discovered that, in fact, a used motor and transmission had been installed, not a new one. Owen refused to make any further payments and demanded his money back. The car dealership ignored their right to repossess the vehicle and demanded payment from Owen's father. Explain Owen's father's rights in these circumstances.

Accepted Answer

Owen's father has the same defences avai

Question 9

What are the practical consequences affecting the individual who declares personal bankruptcy?

Accepted Answer

If he becomes bankrupt, he will lose mos

Question 10

Explain how, in a creditor/debtor transaction, the exposure of a guarantor is limited and his rights protected.

Accepted Answer

A guarantor is in a unique position and

Question 11

A continuing guarantee

Accepted Answer

A)  allows a creditor to advance further funds without affecting the obligation of the guarantor to pay in the event of default. 
B)  is a primary obligation of a third party to pay a debt along with a debtor. 
C)  is a written commitment not to pursue a legal claim against another. 
D)  is an equitable principle assuring that when security is repossessed, there will be a period of time during which the debtor can still make payment. 
E)  allows a breaching party to pay an amount specified in a contract, rather than facing a lawsuit for damages. 
A)  allows a creditor to advance further funds without affecting the obligation of the guarantor to pay in the event of default. 
B)  is a primary obligation of a third party to pay a debt along with a debtor. 
C)  is a written commitment not to pursue a legal claim against another. 
D)  is an equitable principle assuring that when security is repossessed, there will be a period of time during which the debtor can still make payment. 
E)  allows a breaching party to pay an amount specified in a contract, rather than facing a lawsuit for damages.

Question 12

The practice of paying out one creditor over another is known as fraudulent preference.

Accepted Answer

A) True 
 B)False

Question 13

Both a chattel and a chose in action can be used to secure a debt.

Accepted Answer

A) True 
 B)False

Question 14

What alternatives are available to the bankruptcy process?

Accepted Answer

The Bankruptcy and Insolvency Act allows

Question 15

Crops still in the ground and products in the process of being made can be used by Chartered Banks as security.

Accepted Answer

A) True 
 B)False

Question 16

"The main purpose of security is to provide some recourse to the person claiming to be paid if some dispute arises about the quality of the performance of the contract." Discuss the accuracy of this statement.

Accepted Answer

This statement is inaccurate.

Question 17

"Joe bought a car from Harry's Fine Cars on time secured by a Security Agreement. It ran fine for a while, then he had a series of problems with it that made Joe regret ever entering into the transaction. Joe simply stopped paying, knowing that the only thing that Harry could do was repossess the goods." Explain the accuracy of the final statement.

Accepted Answer

The statement is inaccurate. In fact, Ha

Question 18

Greg told Rick that he would be willing to pay a high rate of interest for a two-month loan of $2000. Rick agreed to lend Greg this amount at an annual rate of 20%, repayable March 1, 2016. Greg agreed to these terms. Greg did not pay on March 1. Rick learned that Greg had recently completed some work for Martinson for which Greg was owed $2000. Now that Greg is in default, which of the following is False?

Accepted Answer

A)  Rick could sue Greg for breach of contract. 
B)  Rick could execute against Greg even if Rick had not obtained judgment against him. 
C)  Rick could not place Greg into bankruptcy unless Greg had committed an act of bankruptcy. 
D)  If Rick obtained a judgment against Greg, he could compel him to be examined about his income, property, and debts. 
E)  Once he has obtained judgment, Rick can garnishee the money owed to Greg by Martinson. 
A)  Rick could sue Greg for breach of contract. 
B)  Rick could execute against Greg even if Rick had not obtained judgment against him. 
C)  Rick could not place Greg into bankruptcy unless Greg had committed an act of bankruptcy. 
D)  If Rick obtained a judgment against Greg, he could compel him to be examined about his income, property, and debts. 
E)  Once he has obtained judgment, Rick can garnishee the money owed to Greg by Martinson.

Question 19

After a creditor has taken possession of collateral, the debtor's right to reclaim it on payment of any money owing is known as a

Accepted Answer

A)  right to salvage. 
B)  right of settlement. 
C)  right to redeem. 
D)  constructive trust. 
E)  collateral contract. 
A)  right to salvage. 
B)  right of settlement. 
C)  right to redeem. 
D)  constructive trust. 
E)  collateral contract.

Question 20

If you want to buy a car from a private party (other than a dealer), which of the following is False?

Accepted Answer

A)  If you request a search and the Personal Property Registry states that the car is free and clear of liens and encumbrances, then title is clear. 
B)  If the seller tells you that the car is free and clear, and two months later a holder of a properly perfected and attached security interest claims a right to the car, you could lose the car. 
C)  Even if both the seller and the Personal Property Registry indicate to you that the car's title is clear, you could still lose it to a third party. 
D)  If the seller indicates to you that the title is clear, but after the sale the car is seized by someone with the legal right to do so, you could still sue the seller. 
E)  If the seller makes no representations whatsoever about the car and the car is seized by a creditor, you can still sue the seller because he had an obligation to deliver good title. 
A)  If you request a search and the Personal Property Registry states that the car is free and clear of liens and encumbrances, then title is clear. 
B)  If the seller tells you that the car is free and clear, and two months later a holder of a properly perfected and attached security interest claims a right to the car, you could lose the car. 
C)  Even if both the seller and the Personal Property Registry indicate to you that the car's title is clear, you could still lose it to a third party. 
D)  If the seller indicates to you that the title is clear, but after the sale the car is seized by someone with the legal right to do so, you could still sue the seller. 
E)  If the seller makes no representations whatsoever about the car and the car is seized by a creditor, you can still sue the seller because he had an obligation to deliver good title.

Explain what is meant by a "chose in action."

A "confirmed letter of credit" is another name for a "standby letter of credit."

Which one of the following statements about bankruptcy is False?

What is the effect of a payment made in preference to one creditor over another?

With regard to bankruptcy and debt collection, which of the following is False?

What is the primary remedy available when goods have been used to secure a loan which has been defaulted?

What are the practical consequences affecting the individual who declares personal bankruptcy?

Explain how, in a creditor/debtor transaction, the exposure of a guarantor is limited and his rights protected.

A continuing guarantee

The practice of paying out one creditor over another is known as fraudulent preference.

Both a chattel and a chose in action can be used to secure a debt.

What alternatives are available to the bankruptcy process?

Crops still in the ground and products in the process of being made can be used by Chartered Banks as security.

"The main purpose of security is to provide some recourse to the person claiming to be paid if some dispute arises about the quality of the performance of the contract." Discuss the accuracy of this statement.

After a creditor has taken possession of collateral, the debtor's right to reclaim it on payment of any money owing is known as a

If you want to buy a car from a private party (other than a dealer), which of the following is False?

Managing Your Legal Affairs

Introduction to the Legal System

The Resolution of Disputes: the Courts and Alternatives to Litigation

Intentional Torts and Torts Impacting Business

Negligence, Professional Liability, and Insurance

The Elements of a Contract: Consensus and Consideration

The Elements of a Contract: Capacity, Legality, and Intention

Factors Affecting the Contractual Relationship

The End of the Contractual Relationship

Agency and Partnership

Corporations

Employment

Intellectual Property

Real and Personal Property and Protection of the Environment

Sales and Consumer Protection

Filters

Exam 15: Priority of Creditors

Explain what is meant by a "chose in action."

A "confirmed letter of credit" is another name for a "standby letter of credit."

Which one of the following statements about bankruptcy is False?

What is the effect of a payment made in preference to one creditor over another?

With regard to bankruptcy and debt collection, which of the following is False?

What is the primary remedy available when goods have been used to secure a loan which has been defaulted?

What are the practical consequences affecting the individual who declares personal bankruptcy?

Explain how, in a creditor/debtor transaction, the exposure of a guarantor is limited and his rights protected.

A continuing guarantee

The practice of paying out one creditor over another is known as fraudulent preference.

Both a chattel and a chose in action can be used to secure a debt.

What alternatives are available to the bankruptcy process?

Crops still in the ground and products in the process of being made can be used by Chartered Banks as security.

"The main purpose of security is to provide some recourse to the person claiming to be paid if some dispute arises about the quality of the performance of the contract." Discuss the accuracy of this statement.

After a creditor has taken possession of collateral, the debtor's right to reclaim it on payment of any money owing is known as a

If you want to buy a car from a private party (other than a dealer), which of the following is False?

Managing Your Legal Affairs

Introduction to the Legal System

The Resolution of Disputes: the Courts and Alternatives to Litigation

Intentional Torts and Torts Impacting Business

Negligence, Professional Liability, and Insurance

The Elements of a Contract: Consensus and Consideration

The Elements of a Contract: Capacity, Legality, and Intention

Factors Affecting the Contractual Relationship

The End of the Contractual Relationship

Agency and Partnership

Corporations

Employment

Intellectual Property

Real and Personal Property and Protection of the Environment

Sales and Consumer Protection

Filters