Question 1

Courts can uphold an agreement that is partly legal and partly illegal.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following is true of a nondisclosure agreement?

Accepted Answer

A)  It requires employees to promise not to reveal any confidential trade secrets, should they leave their present employment. 
B)  It limits a worker's employment options after leaving his or her present job in order to protect the present employer's confidential matter. 
C)  It restricts the seller of a business to enter the same type of business during a reasonable time and within a reasonable geographical area. 
D)  It states that the party who wrote the contract will not be liable for any economic loss or physical injury, even if that party caused the loss or injury. 
A)  It requires employees to promise not to reveal any confidential trade secrets, should they leave their present employment. 
B)  It limits a worker's employment options after leaving his or her present job in order to protect the present employer's confidential matter. 
C)  It restricts the seller of a business to enter the same type of business during a reasonable time and within a reasonable geographical area. 
D)  It states that the party who wrote the contract will not be liable for any economic loss or physical injury, even if that party caused the loss or injury.

Question 3

The illegal practice of charging more than the amount of interest allowed by law is called:

Accepted Answer

A)  libel. 
B)  in pari delicto. 
C)  slander. 
D)  usury. 
A)  libel. 
B)  in pari delicto. 
C)  slander. 
D)  usury.

Question 4

When Julie, aged 27, took flu medication, she became very light-headed and confused. Alice, taking advantage of the situation, persuaded Julie to sell her watch that was worth $1,000 to her for $100. Julie later realized what Alice did and decided to take legal action. Which of the following is true as per contract laws?

Accepted Answer

A)  Julie cannot sue Alice since she, as an adult, voluntarily sold the watch. 
B)  Julie has the right to get her watch back without returning the $100. 
C)  Alice is allowed to keep the watch and Julie should return the $100. 
D)  Alice should return the watch and Julie should return the $100. 
A)  Julie cannot sue Alice since she, as an adult, voluntarily sold the watch. 
B)  Julie has the right to get her watch back without returning the $100. 
C)  Alice is allowed to keep the watch and Julie should return the $100. 
D)  Alice should return the watch and Julie should return the $100.

Question 5

Which of the following is true about the legality of an agreement?

Accepted Answer

A)  An agreement is not divisible if the legal part of a contract can be removed from the illegal part without changing the nature of the contract. 
B)  The court will not enforce any agreement or contract that is either fully or partially illegal. 
C)  An agreement can sometimes be partly legal and partly illegal. 
D)  A court has to enforce both the illegal and the legal parts of the contract. 
A)  An agreement is not divisible if the legal part of a contract can be removed from the illegal part without changing the nature of the contract. 
B)  The court will not enforce any agreement or contract that is either fully or partially illegal. 
C)  An agreement can sometimes be partly legal and partly illegal. 
D)  A court has to enforce both the illegal and the legal parts of the contract.

Question 6

Maria, aged 16, from a wealthy family, purchases designer jeans on credit for $300. The true fair market value for the jeans is $75. Which of the following is true of this case?

Accepted Answer

A)  Maria can disaffirm the purchase because designer jeans are not a necessary. 
B)  She cannot disaffirm, because her family is wealthy. 
C)  She is liable to pay $300, as per contract. 
D)  She may not disaffirm and is liable for $75. 
A)  Maria can disaffirm the purchase because designer jeans are not a necessary. 
B)  She cannot disaffirm, because her family is wealthy. 
C)  She is liable to pay $300, as per contract. 
D)  She may not disaffirm and is liable for $75.

Question 7

Lizzie works as an entertainment journalist for a tabloid newspaper. The editor of a competing tabloid tells her that if she produces a story defaming a television celebrity, she will be given a job at the competing tabloid. After Lizzie produces the article and publishes it in the tabloid she works for, the competing tabloid refuses to hire her. Lizzie wants to bring a breach of contract lawsuit against the competing tabloid for not hiring her. Which of the following is true of this case?

Accepted Answer

A)  Lizzie has committed a crime and hence, cannot file a lawsuit. 
B)  Lizzie can bring forth a lawsuit, as her contract with the competing tabloid contained all five elements. 
C)  Lizzie's contract has been executed; hence, the court is likely to award her damages for breach of contract. 
D)  Lizzie has committed a tort and her contract with the competing tabloid will not be upheld in the court. 
A)  Lizzie has committed a crime and hence, cannot file a lawsuit. 
B)  Lizzie can bring forth a lawsuit, as her contract with the competing tabloid contained all five elements. 
C)  Lizzie's contract has been executed; hence, the court is likely to award her damages for breach of contract. 
D)  Lizzie has committed a tort and her contract with the competing tabloid will not be upheld in the court.

Question 8

Special statutes allow small loan companies, pawn shops, and other lending agencies that accept high-risk applicants for credit to charge a higher rate of interest.

Accepted Answer

A) True 
 B)False

Question 9

Before Kramer entered a detoxification center for his alcoholism, he went to an electronics store and spent $500 on a new, nonrefundable television. He had several drinks before he went into the store, but was not intoxicated. After he was released from the costly center three months later, Kramer decided to return the television. He believed he could disaffirm the contract because he was drinking when he made the purchase. Analyze the case.

Accepted Answer

Kramer will have to prove that he was in

Question 10

A restrictive covenant in a contract for the sale of a business will be upheld if it is reasonable in time even if it extends beyond the areas where the business conducts business.

Accepted Answer

A) True 
 B)False

Question 11

Minors who become emancipated are responsible for their own contracts.

Accepted Answer

A) True 
 B)False

Question 12

By signing a nondisclosure agreement, an employee can be deprived of employment in the future in certain geographical areas.

Accepted Answer

A) True 
 B)False

Question 13

Brandon, a recent law school graduate, says he will provide affordable legal services to anyone who needs help. Although his bar exam results are not out yet, Brandon is certain that he has passed. Legally, are his clients required to pay for his legal services before he has received his license?

Accepted Answer

A)  Yes, a court will require that his clients pay in full for any legal services they receive from him. 
B)  Yes, but if Brandon fails the exam, he must return all consideration to the appropriate clients. 
C)  No, since it is against the law for anyone without the required state license to offer legal advice. 
D)  No, because Brandon has acted incompetently. 
A)  Yes, a court will require that his clients pay in full for any legal services they receive from him. 
B)  Yes, but if Brandon fails the exam, he must return all consideration to the appropriate clients. 
C)  No, since it is against the law for anyone without the required state license to offer legal advice. 
D)  No, because Brandon has acted incompetently.

Question 14

Ron, a fast-talking, used car salesperson, convinced Maureen, an elderly semi-invalid, to purchase an automobile worth $500 for $12,000. When Maureen later refused to pick up the car or pay the bill, the used car dealer sued her. Discuss the case.

Accepted Answer

The court is likely to rule that the con

Question 15

In a locality that restricts business on Sunday, which of the following is usually true regarding these restrictive laws?

Accepted Answer

A)  They invalidate all agreements made on Sunday. 
B)  They validate agreements made on Sunday for delivery of goods on a business day. 
C)  They validate agreements made on Sunday if the business in question has closed on Sunday. 
D)  They validate agreements made on Sunday requiring performance on a Sunday. 
A)  They invalidate all agreements made on Sunday. 
B)  They validate agreements made on Sunday for delivery of goods on a business day. 
C)  They validate agreements made on Sunday if the business in question has closed on Sunday. 
D)  They validate agreements made on Sunday requiring performance on a Sunday.

Question 16

Jeanie, a prosecutor, agrees with Martin not to prosecute Martin's son for drunk driving in exchange for Martin employing her in his law firm two years after the drunken driving charge is dismissed. This is a(n) ____________ that is ____________.

Accepted Answer

A)  nondisclosure agreement; void 
B)  usurious agreement; voidable 
C)  agreement to escape liability; voidable 
D)  agreement to obstruct justice; void 
A)  nondisclosure agreement; void 
B)  usurious agreement; voidable 
C)  agreement to escape liability; voidable 
D)  agreement to obstruct justice; void

Question 17

Larry, 17 years old, bought a moped from the RU-Ready-2-Drive Used Moped lot. The next day, he accidentally ran the moped into a telephone pole and seriously damaged the vehicle. Larry transported the damaged vehicle to RU-Ready-2-Drive and demanded a return on his money. Must RU-Ready-2-Drive comply with his request? Explain.

Accepted Answer

Yes. Since Larry was a minor when the mo

Question 18

____________ that have not been fully performed by both parties, may be repudiated by a minor at any time.

Accepted Answer

A)  Contracts for necessaries 
B)  In pari delicto contracts 
C)  Executed contracts 
D)  Executory contracts 
A)  Contracts for necessaries 
B)  In pari delicto contracts 
C)  Executed contracts 
D)  Executory contracts

Question 19

Eve, an experienced automotive engineer, signs a ____________ agreement with her employer, Environmental Auto Co., that she will never work in the auto industry after she leaves employment with Environmental. A court considering this agreement will ____________.

Accepted Answer

A)  noncompete; declare it void as geographical area is not specified 
B)  restrictive employment; enforce the agreement in any event 
C)  noncompete; only enforce the agreement if it resulted from a bargained-for exchange 
D)  noncompete; enforce the agreement only if such agreements are customary in the auto industry 
A)  noncompete; declare it void as geographical area is not specified 
B)  restrictive employment; enforce the agreement in any event 
C)  noncompete; only enforce the agreement if it resulted from a bargained-for exchange 
D)  noncompete; enforce the agreement only if such agreements are customary in the auto industry

Question 20

Which of the following contracts are not voidable by minors at their option?

Accepted Answer

A)  Executory contracts 
B)  Contracts for necessaries 
C)  Contracts with banks for educational loans 
D)  Contract to purchase land 
A)  Executory contracts 
B)  Contracts for necessaries 
C)  Contracts with banks for educational loans 
D)  Contract to purchase land

Exam 10: Capacity and Legality: The Final Elements

Courts can uphold an agreement that is partly legal and partly illegal.

Which of the following is true of a nondisclosure agreement?

The illegal practice of charging more than the amount of interest allowed by law is called:

Which of the following is true about the legality of an agreement?

Maria, aged 16, from a wealthy family, purchases designer jeans on credit for $300. The true fair market value for the jeans is $75. Which of the following is true of this case?

Special statutes allow small loan companies, pawn shops, and other lending agencies that accept high-risk applicants for credit to charge a higher rate of interest.

A restrictive covenant in a contract for the sale of a business will be upheld if it is reasonable in time even if it extends beyond the areas where the business conducts business.

Minors who become emancipated are responsible for their own contracts.

By signing a nondisclosure agreement, an employee can be deprived of employment in the future in certain geographical areas.

Brandon, a recent law school graduate, says he will provide affordable legal services to anyone who needs help. Although his bar exam results are not out yet, Brandon is certain that he has passed. Legally, are his clients required to pay for his legal services before he has received his license?

Ron, a fast-talking, used car salesperson, convinced Maureen, an elderly semi-invalid, to purchase an automobile worth $500 for $12,000. When Maureen later refused to pick up the car or pay the bill, the used car dealer sued her. Discuss the case.

In a locality that restricts business on Sunday, which of the following is usually true regarding these restrictive laws?

Jeanie, a prosecutor, agrees with Martin not to prosecute Martin's son for drunk driving in exchange for Martin employing her in his law firm two years after the drunken driving charge is dismissed. This is a(n) ____________ that is ____________.

____________ that have not been fully performed by both parties, may be repudiated by a minor at any time.

Eve, an experienced automotive engineer, signs a ____________ agreement with her employer, Environmental Auto Co., that she will never work in the auto industry after she leaves employment with Environmental. A court considering this agreement will ____________.

Which of the following contracts are not voidable by minors at their option?

Ethics, Social Responsibility, and the Law

Sources of the Law

The Judicial Process and Cyber-Procedure

Alternate Dispute Resolution

Criminal Law and Cybercrimes

Tort Law and Cybertorts

The Essentials of Contract Law

Offer, Acceptance, and Mutual Assent

Consideration and Cyber-Payments

Written Contracts and Cyber-Commerce

Third Parties, Discharge, and Remedies

Sales Contracts: Formation, Title, and Risk of Loss

Sales Contracts Rights, Duties, Breach, and Warranties

Product Liability and Consumer Protection

The Nature of Negotiable Instruments

Holders in Due Course Defenses and Liabilities

Bank-Depositor Relationships and Cyber-Banking

Insurance

Mortgages and Security Interests

Bankruptcy and Debt Adjustment

Agency Law

Employment Law

Labor Law

Sole Proprietorships and Partnerships

The Corporate Entity

Corporate Governance

Government Regulation of Corporate Business

Personal Property and Bailments

Real Property and Landlord and Tenant Law

Wills, Trusts, and Advanced Directives

Professional Liability

The Intersection of Law and Science

International Law

Filters

Jeanie, a prosecutor, agrees with Martin not to prosecute Martin's son for drunk driving in exchange for Martin employing her in his law firm two years after the drunken driving charge is dismissed. This is a(n) that is .

Eve, an experienced automotive engineer, signs a agreement with her employer, Environmental Auto Co., that she will never work in the auto industry after she leaves employment with Environmental. A court considering this agreement will .