Deck 7: Business Torts and Product Liability

Question 1

Intentional torts occur when:

A)the tortfeasor is found to have intended to invade a protected interest and the tortfeasor knew,or should have known,of the consequences of the act that resulted in an injury
B)the tortfeasor is found to have intended to invade a protected interest and the tortfeasor could not have known of the consequences of the act that resulted in an injury
C)the tortfeasor is found to have unintentionally invaded a protected interest and the tortfeasor knew,or should have known,of the consequences of the act that resulted in an injury
D)the tortfeasor is found to have unintentionally invaded a protected interest and could not have known of the consequences of the act that resulted in an injury
E)none of the other choices are correct

Answer 1

A

Question 2

Business organizations lobby Congress to impose federal statutory limits on tort damages because they claim that:

A)many of the awards are excessive
B)many of the awards are unjustified
C)the costs of the awards are making American business less competitive
D)all of the other specific choices are correct
E)none of the other specific choices are correct

Answer 2

D

Question 3

When a person suffers an injury due to deliberate deception,there may be a tort of:

A)fraud
B)assault
C)battery
D)all of the other specific choices
E)none of the other specific choices

Answer 3

A

Question 4

Compensation for injured parties accounts for _____________ of the total cost of the tort system.

A)about two-thirds
B)less than half
C)more than half
D)about three-fourths
E)over eighty percent

Question 5

Businesses can:

A)only be involved in negligence torts
B)only be involved in intentional torts
C)can be involved in both negligence and intentional torts
D)are always the plaintiff in intentional tort cases
E)are always the defendant in negligence court cases

Question 6

Which of the following is not needed to establish the tort of intentional misrepresentation:

A)scienter or intent to defraud
B)intent to induce reliance
C)justifiable reliance by the plaintiff on the misrepresentation
D)relationship between the parties
E)all of the other choices are necessary elements to show the tort existed

Question 7

In a intentional misrepresentation suit,the facts alleged to be presented falsely:

A)must be material
B)need not be material
C)must not be material
D)must be unrelated
E)need not be related to the injury

Question 8

Which of the following is not needed to establish the tort of intentional misrepresentation:

A)scienter or intent to defraud.
B)intent to induce reliance.
C)justifiable reliance by the plaintiff on the misrepresentation.
D)use of force by defendant.
E)all of the other choices are necessary elements to show the tort existed.

Question 9

When a person suffers an injury due to deliberate deception,there may be a tort of:

A)fraud
B)misrepresentation
C)fraudulent misrepresentation
D)deceit
E)all of the other choices may be correct

Question 10

Each year about one-half million tort suits are filed.Most are in __________ courts.

A)federal
B)state
C)municipal
D)small claims
E)appellate

Question 11

Compensation for injured parties accounts for _____________ of the total cost of the tort system.

A)about two-thirds
B)over 80%
C)more than half
D)about three-fourths
E)none of the other choices are correct

Question 12

Most tort suits are filed in:

A)state courts
B)federal courts
C)appellate courts
D)small claims courts
E)municipal courts

Question 13

When false information is intentionally presented as fact there may be a tort of:

A)battery
B)assault
C)intentional misrepresentation
D)unintentional misrepresentation
E)intentional equivocating

Question 14

Experts estimate the annual cost of the tort system at:

A)one to two billion dollars
B)ten to twenty billion dollars
C)twenty to forty billion dollars
D)about a quarter trillion dollars
E)no estimates are available

Question 15

Each year about one-half million tort suits are filed.Most are in __________ courts.

A)federal
B)appellate
C)municipal
D)small claims
E)none of the other choices

Question 16

One element of fraud or intentional misrepresentation is scienter.That means:

A)false information about an important fact was passed on
B)the defendant knew there was false information being passed on
C)the defendant wanted the plaintiff to believe the falsehood
D)there was a relationship between the parties that created a legal obligation
E)the extent of damages caused

Question 17

Most tort suits are filed in:

A)municipal courts
B)federal courts
C)appellate courts
D)small claims courts
E)none of the other choices are correct

Question 18

Negligence is:

A)the cause of an intentional tort
B)carelessness in a legal sense
C)failure to file tax returns properly
D)a business term for an accident
E)none of the other choices are correct

Question 19

Fraud,misrepresentation,fraudulent misrepresentation and deceit are all examples of torts caused by:

A)deliberate deception
B)accidental deception
C)intentional battery
D)premeditated harm
E)tax evasion

Question 20

Which of the following is not usually asserted by business about tort awards:

A)they are not costly
B)they are often excessive
C)they make American businesses less competitive
D)the federal government should limit such awards
E)all of the other choices

Question 21

In Lightle v.Real Estate Commission,involving a real estate agent in a dispute over a house sale,the Alaska high court held that the claim of fraudulent misrepresentation against Lightle was justified because:

A)Lightle wanted to buy the house and so misled other buyers
B)Lightle failed to tell the sellers that there were offers on the house
C)Lightle made a partial disclosure that failed to reveal facts that "might have affected the recipient's conduct in the transaction in hand."
D Lightle made a full disclosure that revealed facts that "might have affected the recipient's conduct in the transaction in hand."
E)none of the other choices are correct

Question 22

The intent to defraud is called:

A)defamation
B)fraudulence
C)scienter
D)dishonesty
E)none of the other choices are correct

Question 23

The tort of misrepresentation can be based on:

A)negligence or intent
B)negligence,but not intent
C)intent,but not negligence
D)neither intent or negligence;it requires fraud
E)deceit only

Question 24

In Lightle v.Real Estate Commission,involving a real estate agent in a dispute over a house sale,the Alaska high court held that the claim of fraudulent misrepresentation against Lightle:

A)failed because Lightle only recommended the purchase of a particular house
B)failed because Lightle obtained no financial gain from the problem that occurred
C)failed because the plaintiff is a sophisticated purchaser who could evaluate the situation
D)was justified because Lightle used force to make the deal happen
E)none of the other choices

Question 25

In Lightle v.Real Estate Commission,involving a real estate agent in a dispute over a house sale,the Alaska high court held that the claim of fraudulent misrepresentation against Lightle:

A)failed because Lightle only recommended the purchase of a particular house
B)failed because Lightle obtained no financial gain from the problem that occurred
C)failed because the plaintiff is a sophisticated purchaser who could evaluate the situation
D)was justified because Lightle knowingly passed false information
E)was justified because Lightle used force to make the deal happen

Question 26

The tort of misrepresentation can be based on:

A)negligence,but not intent
B)intent,but not negligence
C)neither intent or negligence;it requires fraud
D)deceit only
E)none of the other choices

Question 27

In Lightle v.Real Estate Commission,involving a real estate agent in a dispute over a house sale,which of the following was not an element of fraudulent misrepresentation noted by the Alaska high court:

A)misrepresentation of facts
B)scienter
C)intent to cause economic loss by foreseeable persons
D)the expectation of reliance by others
E)justifiable reliance by others on misinformation

Question 28

Key element(s)of the tort of intentional interference with contractual relations is (are):

A)a contract between the injured party and the defendant
B)losses were incurred
C)malice by the defendant must be shown
D)a warranty of performance in a contract is breached
E)all of the other specific choices

Question 29

In ASC Construction Equipment USA v.City Commercial Real Estate,where City sued ASC for tortious interference with business relations,the appeals court held that City:

A)could not sue for tortious interference because ASC was not a stranger to the business
Relationship at issue
B)could sue for tortious interference because ASC was not a stranger to the business
Relationship at issue
C)had be defrauded by ASC
D)could not sue ASC because one business cannot sue another
E)none of the other choices are correct

Question 30

Key element(s)of the tort of intentional interference with contractual relations is (are):

A)a contract between the injured party and the defendant
B)the defendant knew about a contract between the injured party and another party
C)malice by the defendant must be shown
D)a warranty of performance in a contract is breached
E)all of the other specific choices

Question 31

Key element(s)of the tort of intentional interference with contractual relations is (are):

A)a contract between the injured party and the defendant
B)the defendant intentionally interfered with a contract between the injured party and another party
C)malice by the defendant must be shown
D)a warranty of performance in a contract is breached
E)all of the other specific choices

Question 32

In Lightle v.Real Estate Commission,involving a real estate agent in a dispute over a house sale,the Alaska high court held that the claim of fraudulent misrepresentation against Lightle was justified because:

A)Lightle wanted to buy the house and so misled other buyers
B)Lightle failed to tell the sellers that there were offers on the house
C)Lightle made racist remarks about the potential buyers
D Lightle made a full disclosure that revealed facts that "might have affected the recipient's conduct in the transaction in hand."
E)none of the other choices are correct

Question 33

In Lightle v.Real Estate Commission,involving a real estate agent in a dispute over a house sale,the agent was sued for:

A)defamation
B)warranty breach
C)fraudulent misrepresentation
D)negligent misrepresentation
E)none of the other choices

Question 34

Scienter is:

A)the intent to defraud
B)the intent to befriend
C)the lack of intent to defraud
D)the ability to defraud
E)none of the other choices are correct

Question 35

One element of fraud or intentional misrepresentation is scienter.That means:

A)false information about an important fact was passed on
B)the defendant wanted the plaintiff to believe the falsehood
C)there was a relationship between the parties that created a legal obligation
D)the extent of damages caused
E)none of the other choices

Question 36

In Lightle v.Real Estate Commission,involving a real estate agent in a dispute over a house sale,the agent was sued for:

A)defamation
B)breach of warranty
C)negligent misrepresentation
D)conversion
E)none of the other choices

Question 37

If a third party observes a fraud:

A)they cannot sue
B)they can sue
C)they can sue,but not recover any damages
D)they can sue on the behalf of the injured party if they split the damage award with the injured party
E)they can sue in some states,but not others

Question 38

Scienter is:

A)the intent to prosecute
B)the intent to befriend
C)the lack of intent to defraud
D)the ability to defraud
E)none of the other choices are correct

Question 39

The key element(s)of the tort of intentional interference with contractual relations is (are):

A)a contract between the injured party and another party (not the defendant)
B)the defendant knew about a contract between the injured party and another party
C)the defendant intentionally interfered with a contract between the injured party and another party
D)losses were incurred
E)all of the other choices

Question 40

If the plaintiff in a fraud case was aware that the key information was false,but went ahead with the deal anyway,then:

A)the damage award will not be as high
B)there is no fraud
C)the defendant will not have to pay damages,but will have to pay the plaintiff's attorney fees
D)the case will go on to a higher court
E)the court's decision cannot be appealed

Question 41

In MDM Group v.CX Reinsurance,CX refused to write ski season insurance policies and was sued by MDM for interference with prospective business.The appeals court held that CX:

A)was not liable as it was prohibited by the state from doing insurance business any longer
B)was liable as it stole clients away from MDM that it had cultivated
C)was liable as it prohibited MDM from continuing its relationships with clients
D)was liable as it induced MDM to develop business relationships that were suddenly cancelled
E)none of the other choices

Question 42

In a case of intentional interference with contractual relations the claim is:

A)the injured business's contractual relations caused them to lose money
B)the injured business's contractual relations were rightfully interfered with by another party
C)the injured business's contractual relations were illegal
D)the injured business's contractual relations were hindered by international regulations
E)none of the other choices are correct

Question 43

The elements of the tort of interference with a prospective advantage (relationship)include:

A)fraud
B)manipulation of the securities market for personal gain
C)predatory behavior
D)defamation of a competitor
E)all of the other choices

Question 44

In a case of intentional interference with contractual relations the claim is:

A)the injured business's contractual relations were wrongfully interfered with by another party
B)the injured business's contractual relations were rightfully interfered with by another party
C)the injured business's contractual relations were illegal
D)the injured business's contractual relations were hindered by international regulations
E)none of the other choices are correct

Question 45

Meddling with another's business in an unreasonable and improper manner to improve one's own place in the market it an example of the tort of:

A)interference with prospective advantage
B)interference with competition
C)interference with business practices
D)interference with intent
E)none of the other choices

Question 46

In MDM Group v.CX Reinsurance,after several years of doing business CX refused to write ski season insurance policies and was sued by MDM for:

A)trespass of business property
B)fraud
C)interference with prospective business
D)negligent misrepresentation
E)none of the other choices

Question 47

The elements of the tort of intentional interference with contractual relations include:

A)the existence of a contractual relationship between the injured business and another party
B)the wrongdoer's knowledge of the contractual relationship between the injured business and another party
C)intentional interference with the contractual relationship
D)all of the other specific choices are correct
E)none of the other specific choices are correct

Question 48

In MDM Group v.CX Reinsurance,CX refused to write ski season insurance policies and was sued by MDM for interference with prospective business.The appeals court held that CX:

A)was not liable for interference with prospective business because there was no third party
B)was liable for interference with prospective business because there was a third party
C)was liable as it prohibited MDM from continuing its relationships with clients
D)was liable as it induced MDM to develop business relationships that were suddenly cancelled
E)none of the other choices

Question 49

One well-known business torts is:

A)intentional interference with contractual relations
B)unintentional interference with contractual relations
C)forced interference with contractual relations
D)interference with advantaged clients
E)interference with intent

Question 50

Which tort is concerned with a business attempting to improve itself in the market by interfering with another's business in an unreasonable and improper manner:

A)interference with prospective advantage
B)interference with competition
C)interference with business practices
D)interference with intent
E)none of the other choices

Question 51

In MDM Group v.CX Reinsurance,CX refused to write ski season insurance policies and was sued by MDM for interference with prospective business.The appeals court held that CX:

A)was not liable as it had no obligation to write policies
B)was not liable as it was prohibited by the state from doing insurance business any longer
C)was liable as it prohibited MDM from continuing its relationships with clients
D)was liable as it induced MDM to develop business relationships that were suddenly cancelled
E)none of the other choices

Question 52

The law of product liability is primarily concerned with:

A)harms suffered by stockholders when the value of their investment falls
B)harms suffered by sellers of defective products
C)harms suffered by businesses for interference with their relations
D)contractual harms suffered by institutional investors
E)none of these

Question 53

The law of product liability is primarily concerned with:

A)harms suffered by stockholders when the value of their investment falls
B)harms suffered by buyers and other persons who use defective products
C)harms suffered by businesses for interference with their relations
D)contractual harms suffered by institutional investors
E)none of these

Question 54

The ___________________ is primarily concerned with harms suffered by buyers and other persons who use defective products.

A)law of stock protection
B)law of malpractice liability
C)law of seller liability
D)law of commercial liability
E)none of the other choices are completely correct

Question 55

In MDM Group v.CX Reinsurance,after several years of doing business CX refused to write ski season insurance policies and was sued by MDM for:

A)trespass of business property
B)fraud
C)breach of commercial contract
D)negligent misrepresentation
E)none of the other choices

Question 56

Privity is:

A)a legal relationship
B)a written relationship
C)an unwritten contract
D)an understanding between partners
E)none of the other choices are correct

Question 57

In ASC Construction Equipment USA v.City Commercial Real Estate,where City sued ASC for tortious interference with business relations,the appeals court held that ASC could not be made to pay punitive damages because:

A)punitive damages are inappropriate for tortious interference suits
B)punitive damages must be less than the amount the plaintiff lost
C)punitive damages are illegal in Georgia
D)ASC was not a stranger to the business relationship at issue and so could not be sued for tortious interference,which was the only claim put forward that could result in punitive damage awards
E)ASC was a stranger to the business relationship at issue and so could not be sued for tortious interference,which was the only claim put forward that could result in punitive damage awards

Question 58

In MDM Group v.CX Reinsurance,CX refused to write ski season insurance policies and was sued by MDM for interference with prospective business.The appeals court held that:

A)a defendant cannot be liable for interference with its own contract
B)the defendant was liable for interference with prospective business because there was a third party
C)the defendant was liable as it prohibited MDM from continuing its relationships with clients
D)the damages awarded by the court were too low
E)none of the other choices

Question 59

In product liability law,privity refers to:

A)the relationship that exists between the plaintiff and the defendant
B)the relationship that exists between the plaintiff and his attorney
C)the relationship that exists between contracting parties
D)the relationship that exists between the judge and jury
E)the relationship that exists between construction crews and their contractors

Question 60

The ___________________ is primarily concerned with harms suffered by buyers and other persons who use defective products.

A)law of stock protection
B)law of product liability
C)law of seller liability
D)law of commercial liability
E)law of malpractice liability

Question 61

For a contractual relationship,it is essential that:

A)privity exists between the parties
B)the parties are well acquainted
C)the parties both have attorneys
D)the parties are both from the same state
E)the parties have both suffered some kind of injury

Question 62

Under the rule of caveat emptor,the producer of a defective product that caused injury to a consumer was:

A)not liable unless there was a contractual relationship between producer and injured party
B)liable in tort law to any injured consumer if negligence by the producer could be shown
C)liable in tort law to consumers who bought the good under the rule of strict liability
D)liable in contract to all consumers who used the product under the rule of res ipsa loquitur
E)not liable in tort or in contract law

Question 63

Privity is:

A)an agreement to privacy
B)an understanding between friends
C)a "gentlemen's agreement"
D)an agreement to agree in the future
E)none of the other choices are accurate

Question 64

The rule that "The manufacturer of a product is liable in the production and sale of a product for negligence,if the product may reasonably be expected to inflict harm on the user if the product is defective" originated from:

A)MacPherson v.Buick Motor
B)Paterson v.Buick Motor
C)Morriss v.Chevrolet
D)MDM Group Associates v.CX Reinsurance Company
E)none of the other choices are correct

Question 65

The term privity of contract refers to:

A)damage awards provided by juries in products liability cases
B)the requirement that products liability law have its origin in the common law of contracts
C)the risk that a product is of adequate legal quality
D)the requirement that products liability litigation must be brought by private citizens
E)none of the other choices

Question 66

Under the rule of ___________,the producer of a defective product that caused injury to a consumer was not liable unless there was a contractual relationship between producer and injured party.

A)res ipsa loquitur
B)stare decisis
C)manufacturer liability
D)proximate cause
E)none of the other choices

Question 67

In MacPherson v.Buick Motor the court held for MacPherson for injuries caused by defective wheels on his Buick.This case allowed for negligence for product liability:

A)only when privity existed
B)with exception for contract warranty
C)with implied warranty
D)without exception
E)except for commercial sales

Question 68

Unless a consumer buys a product directly from the producer:

A)there is no privity between consumer and producer
B)there is privity between consumer and producer
C)there cannot be a case of battery
D)there cannot be a damage award greater than $100,000
E)none of the other choices are correct

Question 69

In MacPherson v.Buick,where the wheel on a new Buick collapsed,causing the car to crash,injuring MacPherson,the court of appeals held MacPherson could sue Buick because:

A)Buick was a manufacturer of automobiles and responsible for the finished product
B)Buick was a wealthy enough company to afford paying damages
C)Buick was liable because it advertised that the wheels were safe on every vehicle
D)MacPherson's injuries were life-threatening
E)none of the other choices are correct

Question 70

Under the rule of caveat emptor,the producer of a defective product that caused injury to a consumer was:

A)not liable in either tort law or contract law
B)liable in tort law to any injured consumer if negligence by the producer could be shown
C)liable in tort law to consumers who bought the good under the rule of strict liability
D)liable in contract to all consumers who used the product under the rule of res ipsa loquitur
E)none of the other choices

Question 71

In MacPherson v.Buick,where the wheel on a new Buick collapsed,causing the car to crash,injuring MacPherson,the court of appeals held that:

A)Buick was not responsible to the consumer because it did not make the defective wheel
B)the wheel manufacturer was liable for negligence for making a defective wheel
C)Buick was not liable because it did not have privity with MacPherson,the buyer
D)Buick was not liable;the dealer was liable as the seller of the finished product
E)none of the other choices

Question 72

In MacPherson v.Buick,where the wheel on a new Buick collapsed,causing the car to crash,injuring MacPherson,the court of appeals held MacPherson could sue Buick because:

A)Buick was only a dealer of automobiles,but still was responsible for the finished product
B)Buick was a wealthy enough company to afford paying damages
C)Buick was liable because it advertised that the wheels were safe on every vehicle
D)MacPherson's injuries were life-threatening
E)none of the other choices are correct

Question 73

In MacPherson v.Buick,where the wheel on a new Buick collapsed,causing the car to crash,injuring MacPherson,the court of appeals held that:

A)Buick was not responsible to the consumer because it did not make the defective wheel
B)the wheel manufacturer was liable for negligence for making a defective wheel
C)Buick was liable to the consumer for the finished product
D)Buick was not liable;the dealer was liable as the seller of the finished product
E)none of the other choices

Question 74

The term privity of contract refers to:

A)the relationship that exists between the parties to a contract
B)damage awards provided by juries in products liability cases
C)the requirement that products liability law have its origin in the common law of contracts
D)the risk that a product is of adequate legal quality
E)the requirement that products liability litigation must be brought by private citizens

Question 75

Under the rule of ___________,the producer of a defective product that caused injury to a consumer was not liable unless there was a contractual relationship between producer and injured party.

A)res ipsa loquitur
B)stare decisis
C)caveat emptor
D)proximate cause
E)none of the other choices

Question 76

During the 19th century,parties injured by a defective product,who did not have a contractual relationship with the seller,were under the rule of:

A)res ipsa loquitur
B)stare decisis
C)caveat emptor
D)proximate cause
E)none of the other choices

Question 77

In MacPherson v.Buick,where the wheel on a new Buick collapsed,causing the car to crash,injuring MacPherson,the court of appeals held MacPherson could sue:

A)Buick for negligence under contract law
B)Buick for negligence under tort law
C)Buick for strict liability under contract law
D)Buick for strict liability under tort law
E)the wheel maker,not Buick,for negligence in product construction

Question 78

During the 19th century,parties injured by a defective product,who did not have a contractual relationship with the seller,were under the rule of:

A)res ipsa loquitur
B)stare decisis
C)strict liability
D)proximate cause
E)none of the other choices

Question 79

In MacPherson v.Buick Motor the court held for MacPherson for injuries caused by defective wheels on his Buick.This case allowed for negligence for product liability:

A)with privity
B)with exception
C)with implied warranty
D)without privity
E)without exception

Question 80

In MacPherson v.Buick,where the wheel on a new Buick collapsed,causing the car to crash,injuring MacPherson,the court of appeals held MacPherson could sue:

A)Buick for negligence under contract law
B)Buick for deceptive sales practices
C)Buick for strict liability under contract law
D)Buick for strict liability under tort law
E)none of the other choices