Deck 8: Special Business Contracts and Consumer Protection

Question 1

Which of the following is a synonym for "bailment"?

A)release
B)guarantee
C)ownership
D)custody
E)liability

Answer 1

D

Question 2

You leave your jacket on a hook at the front of a restaurant, just below the sign that says "Not responsible for lost or stolen articles of clothing." During your meal, a waiter walks by the coat rack with a flaming drink, and your jacket catches fire. Can you sue the restaurant for the damage? Why or why not?

A)No. You must have seen the sign, which excludes liability.
B)Yes. There has been a fundamental breach of contract. Your meal was ruined.
C)Yes. The exclusion clause will be strictly construed, and your jacket was neither lost nor stolen.
D)No. The jacket never left your possession.
E)Both B and C

Answer 2

C

Question 3

Which of the following is NOT a bailment?

A)sending a box of books via Air Canada to Vancouver from Ottawa
B)leaving your lap top computer in your hotel room when you are at dinner
C)buying a ticket to a Blue Jays game
D)taking your computer into to Best Buy to be repaired
E)borrowing your neighbour's lawnmower to cut your grass

Answer 3

C

Question 4

Which of the following situations involves a bailment?

A)The sale of a clock to a consumer.
B)Bringing a computer in for repair
C)Giving a parcel to a courier for delivery
D)Both A and B
E)Both B and C

Question 5

The difference between bailment and sale is that in bailment:

A)There is always a change in ownership.
B)There is sometimes a change in ownership.
C)There is always a change in possession.
D)There is sometimes a change in possession.
E)Both A and C

Question 6

You stay overnight at the Flea Bag Motel and your Rolex watch is stolen from your room. You forgot to lock your room while you were out, and it seems likely that the thief entered it that time. There was a conspicuous notice on the door - although you didn't read it - under the Innkeepers Act, limiting its liability for loss or injury to goods to $40. Can you sue the motel for your loss beyond that amount? Why or why not?

A)No. It was your own negligence that caused your loss.
B)No. When you checked in, the motel did not expressly agree to accept responsibility for your personal possessions.
C)Yes. A motel is not an "inn".
D)Yes. The notice required by the Act was not brought to your attention.
E)No. The motel complied with and is protected by the Act.

Question 7

Which of the following describes the legal relationship when a person leaves their car at a repair shop to have the engine repaired?

A)lease
B)conditional sale
C)bailment
D)sale
E)trust

Question 8

Clyde's car breaks down on the way home from work. He has the tow truck driver tow it to Atlas Motors, a repair shop. The car is left in the parking lot, since the shop is closed, and Clyde leaves the keys in the car and a note under the door of the shop. Unfortunately, the lot is not very secure and the car is stolen that night. Which of the following is TRUE?

A)Atlas had a duty to show reasonable care for the car.
B)The onus will be on Atlas to show that the theft was not due to their negligence.
C)Atlas was a bailee for hire of the car
D)There was no bailment, since Atlas was not aware that Clyde had left the car with it.
E)All of the above.

Question 9

Jane takes her $15,000 car to Ace Auto Repairs to have a new transmission put in. When the repair was completed Ace gave Jane a bill for $2,000. Jane said she will pay $500 now and the rest when she gets a job. As a result, which of the following statements is TRUE?

A)Jane has the right to have the car returned to her right now
B)Ace has the right to keep her car until Ace is paid, but it cannot sell Jane's car
C)Ace has the right to sell Jane's car and keep all the money from the sale of the car
D)Ace has the right to sell Jane's car but can only keep the money that it is owed
E)Jane will be liable for $2,000 plus punitive damages

Question 10

A lien right is

A)the right of a transportation company to limit its liability
B)the right of a bailee to sue a customer if they are not paid
C)the right of a bailee to keep and sell the owner's goods if not paid
D)the right of the customer to get its money back if there is a breach of contract
E)the right of a bailee to transfer its duty to another company to fulfil a bailment contract

Question 11

Which of the following statements is FALSE? In a bill of lading

A)is a receipt showing a transportation company has goods to be delivered
B)usually include a term that limits the liability of the transportation company
C)courts no longer require that the bill of lading be signed to be valid
D)are governed by federal and provincial statutes
E)require that adequate notice has to be given to the customer for an exemption clause to be effective

Question 12

Dusty delivered his car to Gage's Garage for some routine repairs and at the time of delivery, was advised that the car would be ready in two days. That night, Dusty's car was stolen from the garage and was never recovered. If Dusty takes legal action against Gage in order to recover the value of the car, what will be the legal position?

A)Dusty will not be able to recover the value of the car from Gage as he will be deemed to have assumed the risk of its loss.
B)The garage operators will be deemed to have absolute liability for all goods lost in their possession.
C)Dusty will have to prove that the garage operators were involved in the theft.
D)Gage will not be found liable if it can show that it took reasonable measures to safeguard the car.
E)The court will impose a very high standard of care on Gage which must show that it took every precaution to safeguard the car.

Question 13

John's Repair Shop has fixed a stereo. The customer wants to take the stereo and pay for it in thirty days if the repair work is satisfactory. Which of the following is true?

A)John's has the right to keep the stereo until the customer pays for the repair.
B)John's can't keep the stereo, but must release it and sue on the contract if the customer doesn't pay.
C)John's must let the customer take the stereo and try it out to see if the repairs are satisfactory.
D)John call see the stereo if payment is not made within three days.
E)Both B and C

Question 14

Which of the following is a synonym for "bill of lading"?

A)Certificate of landing
B)Estoppel certificate
C)Bill of sale
D)Way bill
E)Exemption clause

Question 15

CN Rail agreed to transport $2 million worth of electronic parts for Sony Inc. The CN train derailed and the parts were completely destroyed. The limitation clause in the bill of lading limited CN's liability to $50,000. Sony noticed however that the bill of lading had not been signed. As a result

A)CN is fully liable for the $2 million loss as it was negligent
B)CN can use the limitation clause and is only liable for $50,000 even though it was not signed
C)Sony and CN will share the liability equally because the bill of lading was not signed
D)CN can only use the limitation clause if it brought the clause to Sony's attention when the deal was made
E)CN can only use the limitation clause if the bill of lading was signed and the clause was brought to Sony's attention

Question 16

Intangible personal property includes

A)furniture, cars and clothing
B)loans, debts, goodwill
C)fixtures and equipment
D)furniture and fixtures
E)copyrights, patents and equipment

Question 17

John sends his alarm clock, which he uses at home, back to the manufacturer for repair, by courier. Giving the clock to the courier is called :

A)a consumer sale.
B)a service agreement
C)a change of ownership but not possession
D)a bailment
E)an assignment

Question 18

A central concept in bailment is that:

A)The bailee becomes owner temporarily.
B)The bailee has no rights over the goods.
C)The goods need not be delivered.
D)The bailee has possession but not ownership
E)It must be for reward.

Question 19

Which of the following does a bailee (custodian)have?

A)Possession.
B)A right to a lien for unpaid work
C)Ownership
D)Both A and B
E)All of the above

Question 20

Marion was a guest at Hotel 9. She forgot her purse in her room while she was in the Hotel restaurant and upon returning, discovered that it had been stolen. Marion made a report to the hotel manager and advised him that she had valuables in her purse totaling approximately $10,000. The manager advised her that in accordance with the notice posted by the hotel on the back of the room door, the hotel's liability was limited to $100. Marion indicated that she had not read the notice and had no knowledge of its contents. Which of the following is TRUE?

A)The hotel is responsible for the full amount of Marion's loss as the law does not allow hotel operators to try and limit their liability to guests.
B)The notice posted by the hotel is effective to limit its liability to $100.
C)The hotel is liable for the full amount of Marion's loss only if it can be proven that it occurred as a result of its negligence.
D)The notice posted by the hotel is an exclusion clause which will be strictly interpreted by the courts.
E)The hotel could have by the notice, effectively limited its liability but as Marion has not read the notice, then it is liable for the full amount of her loss

Question 21

Susan Luckman decided to change her car and decided to purchase a white 2013Toyota Corolla from Brice Used Car Dealers. Two weeks later, Susan went to pick up her new car and discovered that the windshield wipers and lights were not working properly. Susan refused to accept the car and pay the remainder of the agreed purchase price. Which of the following statements is TRUE?

A)Susan must accept the car but can claim against Brice for the cost of the necessary repairs.
B)Brice breached a warranty of the contract and as such Susan has the right to terminate the contract and obtain a refund of the monies already paid.
C)Brice breached a condition of the contract and as such Susan will be entitled to terminate it and obtain a refund of the monies paid.
D)Brice has fundamentally breached the contract and Susan can seek punitive damages
E)Susan will be obliged to accept the car and pay the remainder of the price as the contract was substantively performed by Brice.

Question 22

Al Guardino ran a retail greenhouse. In the fall, he visited Heidi Green's plant and tree farm to place an order for the following season. He spent a lot of time examining her stock. It looked healthy, so he placed a large order to be delivered in the spring. When it arrived, he was busy and only glanced at the items, which he thought looked fine. After a few weeks in the greenhouse, however, he noticed some disease damage, which must have occurred before the plants were shipped. What are Al's remedies?

A)He can obtain damages for breach of warranty.
B)He has no remedy. He was able to compare the goods delivered with the sample and chose not to.
C)The defect in the goods delivered was not apparent on a reasonable examination of the sample.
D)He can rescind the contract for breach of condition.
E)Both C and D.

Question 23

In Your Face Inc. manufactures mirrors, and sold an order to a retailer, The Glass Company ("TGC"), on 90 days credit. There are no other terms mentioned. The order was delivered. TGC did not pay, and has been selling the mirrors. Which of the following is TRUE?

A)In Your Face is entitled to repossess the mirrors immediately because TGC has broken a condition of the agreement by not paying.
B)In Your Face is entitled to repossess the mirrors immediately because TGC has broken a warranty of the agreement by not paying.
C)In Your Face is entitled to repossess the mirrors immediately because TGC has broken a term of the agreement.
D)In Your Face is not entitled to repossess the mirrors.
E)In Your Face is entitled to rescind the contract.

Question 24

Real property is

A)land, buildings and fixtures
B)any hard asset
C)anything but intangible property
D)any asset that can be weighed or measured
E)all tangible and intangible property

Question 25

Which of the following is a warranty under the Sale of Goods Act?

A)Goods are of the quantity ordered.
B)Goods are free of liens
C)Goods are of merchantable quality
D)Time of payment for goods
E)Both B and D

Question 26

Vera Macullum decided to have a face lift and chose Dr. Harry Berry, a noted cosmetic surgeon to do the work. During the surgery, Dr, Berry who was highly distracted owing to some personal problems, made a bad incision which lead to Vera suffering permanent muscle damage on one side of her face. Vera filed a claim against Dr. Berry in negligence and for breach of contract and in particular, breach of the condition of merchantability under the Sale of Goods Act. Which of the following statements is TRUE?

A)Vera will likely recover damages on both of her claims as on the facts given Dr. Berry has no reasonable defence.
B)under the Sales of Goods Act, Vera can also recover punitive damages
C)Vera will likely succeed in her contract claim but not on her negligence claim as Dr. Berry could not reasonably have foreseen the results of his actions.
D)Vera can only succeed in a claim under contract law
E)The Sales of Goods Act does not apply to this transaction

Question 27

Pack-it Co. sold a packaging machine to Boxes Ltd. and nothing was said in the contract about any guarantee of quality or performance. The machine broke down after one day of use. Which of the following statements is true?

A)Boxes Ltd bought "as is" and must pay the cost of the repair itself.
B)The Sale of Goods Act implies a term of fitness for general use into the agreement even thought the parties said nothing about it.
C)The courts will imply a warranty into an agreement by common law principles.
D)Boxes may rely on Pack-it's express warranty.
E)None of the above.

Question 28

Genosha Limited ordered 500 pairs of jeans from Jeans Co. a company based in Sydney Australia. JeansCo's standard ordering form on which the order was made, provides that payment must be made within 10 days of the date of delivery. Genosha received the jeans but owing to financial difficulty, has been unable to complete the payment of the purchase price. Which of the following statements most accurately describes JeansCo's best legal position?

A)It can seek punitive damages against Genosha.
B)It can cancel the contract and sue for the recovery of the goods
C)It can sue for the recovery of the goods but cannot cancel the contract
D)It can seize the jeans as the law allows sellers some margin of self help.
E)It can sue Genosha for damages for breach of contract equivalent to the outstanding amount of the purchase price.

Question 29

To which of the following contracts does the Sale of Good Act not apply?

A)The purchase of a car.
B)The leasing of computer equipment
C)The purchase of a re-conditioned refrigerator
D)The installation of a deck on a house
E)Both B and D

Question 30

Susan Luckman decided to buy a used car from Brice Car Dealers. Susan made it clear that she wanted a Toyota Corolla white which was her favourite colour and that the model year should not be later than 2012. Two weeks later, Susan went to pick up her new car and discovered that the car dealer had sourced a 2010 Corolla which was green in colour. Susan refused to accept delivery of the vehicle and pay the remainder of the agreed purchase price. If Brice takes legal action against Susan to enforce the contract, what will be the likely result:

A)Brice breached a warranty of the contract and as such Susan has the right to terminate the contract and obtain a refund of the monies already paid.
B)Susan will be obliged to accept the vehicle and pay the remainder of the price as the contract was substantively performed by Brice.
C)Brice breached a condition of the contract and as such Susan will be entitled to terminate it and obtain a refund of the monies paid.
D)Brice has fundamentally breached the contract and Susan can seek punitive damages
E)If Susan refuses to accept the car and pay the remainder of the price, she will be in breach of the contract and Brice can forfeit her deposit.

Question 31

Which of the following does the Sale of Goods Act allow the parties to do by express agreement?

A)Exclude the implied warranties and conditions.
B)Specify terms to be conditions or warranties.
C)Specify terms to be conditions or warranties but not exclude those implied terms
D)Both B and C
E)Both A and B

Question 32

The Omega Company is thinking of buying computers for all its work stations. It wants to test them for 30 days before agreeing to buy. The supplier, Dall Computers, agrees to this arrangement. Omega still has the computers after 40 days and has not said what is going to do. Who now owns the computers? Why?

A)Omega. There was a contract between Omega and Dall, and ownership transferred to the purchaser as soon as the contract was made.
B)Dall. Ownership does not transfer to the purchaser until the price has been determined.
C)Dall. Ownership doesn't transfer to the purchaser in a sale on approval until he signifies his approval.
D)Omega. Ownership transferred because it kept the goods after the time fixed for returning them.
E)Since the contract was silent on when ownership transferred, the contract is void.

Question 33

Hikari owned a used car lot. In November she went to a snow blower dealership and told the salesperson that she required a snow blower that would be able to remove the snow from her outside display lot 5 meters by 10 meters in size in a half-hour. This salesperson recommended the "Maxim II" which sold for $1,800. In December Hikari used the snow blower three times to remove normal amounts of snow for that month. The snow blower, operating at maximum speed, took approximately 50 to 60 minutes to remove the snow from the lot. Which of the following best describes Hikari's position at law?

A)There has been a breach of warranty under the Sale of Goods Act and she can claim damages only.
B)There has been a breach of condition under the Sale of Goods Act and Hikari can cancel the contract.
C)The court will decide whether the snow blower's failure to clear the lot in 30 minutes is a condition or a warranty.
D)Because the parties did not specify whether this was to be a condition or warranty, the courts will make that decision.
E)Since this was a sale of a brand name item, Hikari has no recourse against the dealership.

Question 34

Mark sells an order of computers to Home Computing Inc. Home Computing says it will pay in 60 days. This term regarding time of payment is:

A)Deemed a warranty by the Sale of Goods Act.
B)Deemed a condition by the Sale of Goods Act.
C)An express warranty because the parties agreed it to be one.
D)An express condition because the parties agreed it to be one.
E)None of the above because the parties made no agreement about it.

Question 35

Maria's Distributing Inc. sells 20 fax machines to Bill's Electronics Ltd. for $2,000 to be paid in 30 days. No other terms are agreed to. The fax machines are delivered to Bill's the next day. Forty-five days later, Bill's puts up a going out of business sign and advertises these fax machines at $50 each. Bill's has not made one payment to Maria's. Which of the following is true?

A)Maria's Distributing Inc. is the owner of the fax machines.
B)Bill's Electronics Ltd. is the owner of the fax machines
C)Because Bill has not paid, Maria's Distributing Inc. can repossess the fax machines.
D)Both A and C.
E)Both B and C

Question 36

Renee signed the Acme T-shirt Company's purchase order for an order of 200T-shirts with the picture of a polar bear wearing sunglasses on the front to sell through her retail shop. The contract contained a term that stated "Seller warrants that the goods will be of merchantable quality." On receiving the T-shirts, Renee discovered the logo of the polar bear had been printed upside-down. Which of the following statements best describes Renee's legal position?

A)The court will decide whether the defective printing of the logo is a breach of a condition or a warranty.
B)The Sale of Goods Act will specify whether the defective logo is a breach of condition or warranty.
C)This is a breach of a condition and Renee can cancel the contract.
D)The terms of the purchase order will determine if this clause is a condition or a warranty.
E)Renee will be awarded pecuniary and punitive damages.

Question 37

Brian Pinsent was a fisherman on the West Coast. As a sideline, he repaired and sold used small boat engines. (He only sold three or four a year). His friend Jocko Stubbs purchased an engine from Brian, which Brian described as "ship shape", although he admitted it was 20 years old. Jocko wanted to use the engine to operate his tractor trailer, although he didn't tell Brian that. After the engine broke down, Brian would not take it back or repair it, so Jocko sued, relying on the B.C. sale of Goods Act. Which of the following statement is true?

A)Jocko could not rely on s. 18(a)of the Act because Brian was not in the business of selling engines.
B)Jocko could not rely on s. 18(b)of the Act because he did not tell Brian the intended use of the engine.
C)There was a breach of the implied condition of merchantability.
D)There was a breach of the implied condition of fitness for use.
E)Both A and B

Question 38

Benny Wong bought a BMW from Danny's Auto sales on Monday. He wanted the tires upgraded to a special racing model. The cost was worked into the purchase price. The whole purchase was financed over three years. Danny's called Benny at 5:00 p.m. on Thursday to tell him the tires were on and that he could pick up the car. Benny didn't actually receive this message until Friday at 8:00 a.m. Friday, the car was severely damaged in the hail storm. Who is responsible for repairing the car? Why?

A)Benny. He was the owner of the car as of Monday when the deal was completed.
B)Benny. He was the owner of the car as of Thursday at 5:00 p.m. when he was notified that the tires were on.
C)Danny's. Benny did not receive notice of completion until after the car was damaged.
D)Danny's. Benny would not become the owner until the price was determined.
E)Benny. The hail storm was an act of God for which Danny's can't be held responsible.

Question 39

Which of the following statements is TRUE?

A)A term of fitness for general use can be excluded by agreement of the parties.
B)A term of fitness for a particular use can be excluded by agreement of the parties.
C)A term that goods sold by description correspond with their description can be excluded by agreement of the parties.
D)Both A and B
E)All of the above

Question 40

Ollie's Orchards has dealt for many years with Trixie Coppola, who owns a catering company that specializes in desserts. He always bills her on a net 30 days basis. Ollie has just loaded a $5,000 shipment of grapes for Trixie onto the truck, when he receives a call from Frank's Fruit farms. Frank tells him that Trixie is months overdue on her accounts with him, and that he's also heard a rumour that Trixie is about to go "belly up". Which of the following statements is FALSE?

A)Trixie has done nothing that would allow Ollie to rescind the contract.
B)Ollie can hold the goods until payment is made.
C)Ollie can stop delivery on the basis that Trixie is insolvent
D)If Ollie stops delivery and Trixie is not insolvent, he will have to pay her damages for any loss she suffers as a result.
E)None of the above.

Question 41

Four major drug companies got together and decided to set the prices they would all charge for Vitamin B and they also divided up sales territories and determined how much each company would sell in each area. Which of the following statements is FALSE? Each company

A)could be found guilty of conspiracy
B)could be found guilty of price fixing
C)could be fined up to $25million and face up to 14 years in jail
D)face administrative monetary penalties of up to $10 million
E)could receive a prohibition order

Question 42

Laura Donen had a swimming pool installed in her back yard. It came with a warranty for materials and workmanship for two years, except for the filtration system. The warranty stated that it was in lieu of any other warranties or conditions, express or implied by law. The filtration system broke down within a week and had to be completely replaced. Can Laura sue the supplier for this? Why or why not?

A)No. The warranty specifically excluded the filtration system.
B)No. The Sale of Goods Act allows parties to exclude its implied conditions and warranties.
C)Yes. The implied conditions and warranties under the Sale of Goods Act take precedence over an express warranty in a contract.
D)Yes. The Consumer Protection Act (or equivalent)prohibits a consumer sale from excluding the implied conditions and warranties under the Sale of Goods Act.
E)Both A and B

Question 43

Ruby Dean, a fashion designer ordered 100 bales of cotton from Gemini Distributors, a noted textile dealer. Prior to agreeing upon the purchase price and the other terms of the sale, Ruby visited Gemini's warehouse and inspected the cotton but failed to notice a defect in the material that would make it unusable. Upon delivery of the cotton, Ruby noticed the defect and refused to accept and pay for the goods. Which of the following statements is TRUE?

A)Gemini has breached a condition of the contract.
B)Having taking advantage of the opportunity to inspect the goods, Ruby must pay for the goods.
C)Ruby can legally refuse to accept and pay for the goods as Gemini had a duty to supply useable goods.
D)Ruby can cancel the contract owing to the defect in the goods.
E)Gemini has breached a warranty of the contract.

Question 44

Computer City advertises that is has Dall Laptop Computers Model S600 regularly $800 on sale for $75. Jenna sees the ad and goes to Computer City as soon as the store opens only to be told they only had 2 Dall S600s in stock but told her that the Dall S700 was in stock and it was regularly $850 on sale for $400. As a result Computer City

A)has done nothing wrong as it had 2 Dall 600s for customers
B)is liable for price maintenance
C)bait and switch
D)predatory pricing
E)abuse of dominant position

Question 45

Jack Ripper, a thief, stole Samantha's car and sold it to Mary. Mary was unaware that the car had been stolen and believed Jack when he told her that it belonged to him. Two months after purchasing the car, Mary sold it to Albert who subsequently sold it to Charles. The police who had been investigating the theft of the car, eventually traced it to Charles. Which of the following statements is TRUE?

A)Charles can sue Albert, Mary and Jack for breach of contract
B)Because Mary was not aware that Jack Ripper had stolen the car she obtained a good title to it.
C)Albert as an innocent purchaser of the car could pass on a good title to it to Charles
D)Samantha does not have the legal right to recover the car from Charles as Charles was an innocent purchaser for value.
E)None of the above.

Question 46

Which of the following statements is TRUE? Misleading advertising

A)occurs if the false statement is made to even only one member of the public
B)occurs even is nobody is actually deceived by the ad
C)is tested by determining if a credulous and inexperienced consumer would believe the ad
D)can be an offence under the criminal matters or the civil reviewable matters section of the Competition Act
E)All of the above statements are true

Question 47

Which of the following statements is FALSE? The purpose of The Competition Act is

A)to ensure small and medium sized businesses have an equitable opportunity to participate in the Canadian economy
B)to provide consumers with competitive prices
C)to maintain and encourage competition among businesses
D)to ensure consumers are provided with product choices
E)to fund new businesses that will provide more competition in certain industries

Question 48

Which of the following is NOT a practice associated with abuse of dominant position?

A)price maintenance
B)false advertising
C)predatory pricing
D)exclusive dealing
E)tied selling

Question 49

Which of the following is a consumer sale under consumer protection legislation?

A)The purchase of an alarm clock for home use.
B)The purchase of an alarm clock for business use
C)The purchase of an alarm clock for resale to a friend
D)The purchase of an alarm clock for use in a business but which is occasionally also used at home.
E)Both A and D

Question 50

Sports Village advertises a sale of snowboards. It says that the Snow Knife board is regularly $800 and is on sale for $400. It turns out that the Snow Knife board sells at most stores in the city for $500. As a result which of the following statements is FALSE? Sports Village

A)is guilty of misleading advertising
B)has done nothing wrong as it had sold this board for $800 for the first week of the winter
C)could face an AMP of up to $10 million
D)could be ordered to publish a corrective notice
E)could face penalties under either the criminal matters section or the civil reviewable matters section of the Competition Act

Question 51

In the Competition Act which of the following offences falls exclusively under the Civil Reviewable Matters section?

A)conspiracy
B)price fixing
C)exclusive dealing
D)misleading advertising
E)market or supply allocation

Question 52

Richard received a letter in the mail that he had just won a cash prize of $2 million in a sweepstakes. The letter said all he had to do was return the winning entry coupon in time. In small print at the end of the letter it stated that the winner had been preselected by a computer and if the winner did not respond, then all the names of those who did respond would be put on a list for a draw for the prize and the odds of winning were 1in 130 million. Richard sent in his entry coupon but did not get the $2 million. When he contacted the company and asked where his money was they told him he had not won, but he insisted that the letter said he was a winner. If Richard wanted to take legal action most likely the result would be

A)Richard would get nothing as nobody would have believed they had won $2 million
B)the company would owe Richard $2 million
C)the company would have to pay Richard a small punitive award of about $15,000 to deter this practice
D)the company would have to pay $10 million AMP
E)the executives of the company that created this scheme would go to jail for up to 10 years

Question 53

Which of the following is NOT a remedy given by the Sale of Goods Act to an unpaid seller?

A)The right to reclaim possession of the goods while still in transit.
B)A right to seize the goods
C)The right to delay delivery of the goods until payment has been made.
D)A right to sue the purchaser for the purchase price
E)The right to retain any deposit received from the purchaser

Question 54

Martin takes a box of cookies to the cash register at his local Food Mart store. The price on the box is marked $2.99 but when the sales clerk scans the cookies it says $3.49. As a result Martin

A)gets the cookies for free
B)only has to pay $2.99 for the cookies
C)has to pay $3.49 for the cookies
D)get the cookies for free and a coupon for two more free boxes of cookies
D)will get the cookies for free is Food Mart has voluntarily adopted the Scanner Price Accuracy Voluntary Code set up by the Competition Bureau

Question 55

The ten hotels in Ottawa with 5 star ratings were each asked separately to give the federal government a price that it would charge per night for people associated with the federal government staying at their hotel. The 10 hotels then contacted each other and agreed that they would each tell the federal government that the special government room rate would be $110 per night. As a result which of the following statements is TRUE? The hotels

A)did nothing illegal as they have the right to discuss their pricing strategies
B)are guilty of an offence under the Civil Reviewable Matters section of the Competition Act
C)are guilty of abuse of dominant position
D)are guilty of bid rigging
E)could face penalties of up to 20 years in jail and maximum fines of $10 million

Question 56

Jack Ripper, a thief, stole Samantha's car and sold it to Mary. Mary was unaware that the car had been stolen and believed Jack when he told her that it belonged to him. Two months after purchasing the car, Mary sold it to Albert who subsequently sold it to Charles. The police, who had been investigating the theft of the car, eventually traced it to Charles. Which of the following statements is TRUE?

A)If Samantha recovers the car from Charles who subsequently claims against Albert, Albert can seek to recover from Mary the money that he paid to her.
B)If Samantha recovers the car from Charles, Charles can seek to recover the purchase price of the car from Albert.
C)Samantha has the legal right to recover the car from Charles
D)All of the above
E)Mary may not be able to recover any losses sustained unless she can find and make a claim against Jack Ripper.

Question 57

Buy It Now leases a snow blower for one year from Blow It Out Your Ear to clear the parking lot next to its retail outlet. The lease says the snow blower is leased "as is". After one week the snow blower breaks down completely. Buy It Now demands that Blow It Out Your Ear pay for the repair, but it points to the "as is" clause. Which of the following, if any, apply to this transaction?

A)The Sale of Goods Act.
B)The Consumer Protection Act (or equivalent)
C)The Occupier's Liability Act
D)The Hazardous Products Act
E)None of the above

Question 58

Four companies that dominated the Canadian market for frozen ice cream pies had repeatedly got together over 5 years and agreed on the prices they would charge for their products. Finally Alison Reid, the secretary to the president of Ice Treats Inc. called the Competition Bureau and said that the companies had been price fixing for 5 years. The Competition Bureau first contacted Ice Treats and it admitted what it had done and gave the Competition Bureau records it had showing their agreements with the other companies. As a result which of the following statements is FALSE?

A)Alison is a whistleblower and the Competition Bureau cannot reveal her name
B)Ice Treats can fire Alison for what she has done
C)Ice Treats my receive immunity or leniency from the Competition Bureau
D)executives at the company could face up to 14 years in jail and the companies could be fined up to $25 million
E)a class action could be brought against these four companies

Question 59

Jackie went to purchase a sweater at Chic Ltd. and there were two price tags on the sweater, one listed the price as $60 and the other tag listed the price as $40. When Jackie went to pay for the sweater the sales clerk said the sweater was $60 and that someone must have made a mistake putting the second wrong price tag on the sweater. As a result

A)Chic is guilty of double ticketing
B)Chic is guilty of an offence under the criminal matters under the Competition Act
C)Chic is guilty of an offence under the civil reviewable matters section of the Competition Act
D)All of the above
E)Jackie has to pay $60 if she wants the sweater as it is an honest mistake

Question 60

Enrico purchased a home stereo system from Wide Spectrum Sound for $4,000. When the components were all connected the sound produced was so muffled that it needed to be played at full volume in order to get a reasonable clarity. When Enrico returned to Wide Spectrum, the clerk pointed to a clause on the back of the sale receipt that stated: "There are no other warranties or conditions expressed or implied by common law, statute, or otherwise." The clerk also pointed out the same term in the manufacturer's warranty card included with the system. Which of the following would assist Enrico in obtaining a remedy for his defective sound system?

A)The Sale of Goods Act.
B)The fact that Enrico had not read the clause excluding warranties on the back of the sales slip.
C)Consumer protection laws.
D)Common law principles of contract
E)Self-help

Question 61

Bailment involves the transfer of the possession of property with the intent thereby
to transfer its ownership.

Question 62

Two large steel companies with combined assets of $900 million want to merge. Which of the following statements is FALSE? The two companies

A)can proceed with the merger and only have to notify the Competition Bureau if shareholders request it
B)can have the merger blocked by the Competition Bureau
C)can have terms imposed on the merger by the Competition Bureau
D)will be reviewed to determine if the merger substantially lessens competition
E)will be guilty of a criminal offence if they do not notify the Competition Bureau of the merger

Question 63

In a contract for the sale of goods, ownership and possession always pass to the buyer
at the same time.

Question 64

False advertising, conspiracy and abuse of dominant position are dual track offences under the Competition Act.

Question 65

If no annual interest rate is listed on a contract, just a monthly interest rate, the consumer does not have to pay any interest on the amount owed.

Question 66

All transactions of a commercial nature are subject to the Sale of Goods Act.

Question 67

In accordance with the principle of freedom of contract, the parties to a consumer sale
can agree that the application of the implied conditions of the Sale of Goods Act will not apply.

Question 68

If a final bill for a repair exceeds the original estimate by 15% the customer can insist that they only have to pay the estimated price.

Question 69

Breach of a warranty will entitle the innocent party to either claim for damages or refuse
to complete the contract.

Question 70

Innkeepers have unlimited liability for loss or damage to goods left by a guest in a room.

Question 71

There is an implied condition that the seller of goods has the legal right to sell the goods and there is an implied warranty that the goods are free from any charge or encumbrance.

Question 72

A mechanic, who repairs a motor car and is not paid for his services, can sell the car to
recover the cost of his services.

Question 73

The standard of care required of a custodian of goods who is in the business of bailment,
is to take the same steps to ensure the protection of the goods that any ordinary careful person would take.

Question 74

Under PIPEDA, which of the following statements is FALSE? Companies that collect information

A)have an obligation to retain the information only as long as required for the purpose identified at the time it was collected
B)have an obligation to maintain the accuracy of personal information
C)have an obligation to put security safeguards in place to protect the information
D)can face fines of up to $10 million and 10 years in jail if they leak private information
E)can be guilty of an offence if they accidentally leak customers' private information

Question 75

A major watch manufacturer, Time Out Inc., told retail stores that sold Time Out products that they had to sell the watches at set specific prices or else Time Out would refuse to supply them with watches. As a result Time Out

A)is guilty of tied selling
B)is guilty of exclusive dealing
C)is guilty of predatory pricing
D)is guilty of price maintenance
E)is guilty of nothing as it has the right to maintain the price and reputation of its products

Question 76

The purchase of twenty new computers by a university will be subject to consumer
protection legislation.

Question 77

In accordance with the Sale of Goods Act, the implied condition that the goods must be
of merchantable quality requires that the goods must be adequate but there can be defects.

Question 78

In a contract for the sale of goods, only those terms which the parties have expressly
agreed upon can ever become a part of the contract.

Question 79

Incoterms are used in purchase orders and determine who should insure goods and who bears the loss if the goods are lost or damaged.

Question 80

The leading major manufacturer of an artificial sweetener told its customers that it would not sell its sweetener to them if they purchased any sweeteners from any other suppliers. This is

A)tied selling
B)predatory pricing
C)exclusive dealing
D)market restriction
E)refusal to deal