Exam 3

Question 1

Can revocation of a contract be valid any time prior to acceptance?

Answer 1

Yes

Question 2

Do options require consideration to be valid?

Answer 2

Yes

Question 3

Under common law, is a counteroffer also a rejection?

Answer 3

Yes

Question 4

What contract subject matters would not be covered under the UCC?

Answer 4

A contract for the sale of a mobile home plus the lot where it sits.

Question 5

What is required for a valid UCC offer?

Answer 5

Quantity and subject matter are required for a valid UCC offer.

Question 6

What contract features are effective upon mailing or dispatch?

Answer 6

An offer must be communicated to the offeree before it is valid. A letter containing an offer is not effective until the letter reaches the offeree.

Question 7

To be valid, a UCC merchant’s firm offer must require what parts?

Answer 7

The offer must be evidenced by a record.

Question 8

Under both UCC and common law, a counteroffer is considered what?

Answer 8

A counter offer is also a rejection of the initial offer.

Question 9

What are the requirements for a merchant’s confirmation memorandum?

Answer 9

Evidenced by a record or an underlying oral agreement meet the requirements for a merchant’s confirmation memorandum.

Question 10

What are not risks associated with international contracting?

Answer 10

Currency exchange rates, transportation costs, or fee collection are not considered risks in international situations.

Question 11

When is contract with a minor voidable at the minor’s option?

Answer 11

Contracts entered into by a minor are voidable.

Question 12

Is a contract with a party who has been declared incompetent voidable?

Answer 12

Not always.

Question 13

What are the differences between compensatory damages, incidental damages, and liquidated damages?

Answer 13

Compensatory- special loss suffered

Incidental- costs of keeping any more damages from occuring

Liquidates- agreed in advance where the actual amount is difficult to ascertain

Question 14

Is material information considered something that would affect the decision to buy or sell?

Answer 14

Yes

Question 15

If a 17 year old enters into a contract to buy a car, does the contract present a voidable option?

Answer 15

Yes

Question 16

What are elements of dress?

Answer 16

The deprivation of a meaningful choice is the element of duress.

Question 17

Are any contracts with illegal subject matter considered enforceable?

Answer 17

No, they are void.

Question 18

A provision in a contract requiring that a buyer obtain financing before a deal can go through, is an example of what concept?

Answer 18

A condition precedent.

Question 19

What is force majeure clause?

Answer 19

A clause that serves to shift the risk of unforeseen events.

Question 20

What articles of a non-complete agreement in business sales contract considered not reasonable?

Answer 20

Covenants to not compete are allowed when terms are reasonable in time and geographic scope.

Question 21

What does Caveat emptor mean in latin?

Answer 21

“Let the buyer beware”

Question 22

Privity of contract describes what type of a direct contractual relationship between the parties?

Answer 22

A direct contractual relationship between the parties.

Question 23

When is the implied warranty of merchantability (unless disclaimed) given in a sale of goods?

Answer 23

Is given in every sale of goods by a merchant.

Question 24

Does the language “as is” disclaim the warranty of merchantability and the warranty of fitness for a particular purpose?

Answer 24

Yes

Question 25

What elements are requirements for an express warranty to be in effect?

Answer 25

A description or promise of performance

Question 26

What is required in the implied warranty of merchantability situation?

Answer 26

Proof that the seller is a merchant.

Question 27

The statement of "as is" written in a contract presents what features?

Answer 27

Serves to disclaim the implied warranty of merchantability and to disclaim fitness for a particular purpose.

Question 28

How does "privity" in negligence product liability cases apply?

Answer 28

Privity is not required in a negligence product liability case.

Question 29

What duties could not be a basis for a negligence suit?

Answer 29

Hotel to guest, physician to patient, and an accountant to client would not be a basis for a negligence suit.

Question 30

What describes the UCC "warranty of merchantability" concept?

Answer 30

The warranty of merchantability can be disclaimed by using the term "as is."

Question 31

Do al WTO members follow the 20 year old period of patent protection?

Answer 31

Yes

Question 32

Is the development of a process to extract new matter for other uses from existing matter considered patentable?

Answer 32

Yes

Question 33

Do software copyrights cover the underlying program features of software?

Answer 33

Yes

Question 34

What tort protects a business whose trade secrets have been taken without authorization?

Answer 34

Misappropriation

Question 35

How many states have adopted the Uniform Trade Secrets Act?

Answer 35

45 states

Question 36

What actions are considered to meet definition of "palming off" goods?

Answer 36

Palming off occurs when one seller recreates another seller's product.

Question 37

Knockoff goods have what characteristics?

Answer 37

Goods carrying a trademark without authorization.

Question 38

Goods sold by an authorized dealer beyond the dealer's authorized territory or quantity are identified as what type of goods?

Answer 38

Gray market goods.

Question 39

What are trade secrets, and what is considered their lifespan of enforcement?

Answer 39

Need not be registered to be protected, can be lists, customer information, data, or formulas. Can be information/acts that give a competitive edge to the business and are not generally known outside the business or in the public. Employees taking trade secrets away from the business when separating is an actionable offense.

Question 40

Which are elements of disparagement?

Answer 40

Untrue statements, publication, damages, and intent to injure are elements of disparagement.

Question 41

Violations of the Sherman Act can impose what consequences for violations?

Answer 41

Fines and imprisonment.

Question 42

Are competition restraints in commercial leases are generally valid?

Answer 42

Yes

Question 43

What act deals with price discrimination?

Answer 43

The Robinson-Patman Act

Question 44

What act prohibits unfair methods of competition?

Answer 44

Federal Trade Commission Act

Question 45

What are common elements that are found in non-compete covenants that are most likely to validate the agreement?

Answer 45

Reasonable, enforceable, and limited geographic conditions.

Question 46

When are treble damages often recoverable for actions brought under monopoly infractions?

Answer 46

Sherman Act

Question 47

Are superior skill, forseight, and industry a basis to allow a monopoly to exist?

Answer 47

Yes

Question 48

What are per se violations of anti-trust laws?

Answer 48

An act that violates the restrictions of anti-trust laws.

Question 49

What details are needed for an enforceable covenant not to complete?

Answer 49

Reasonable time and geographic limits.

Question 50

Which act contains prohibitions on monopolization?

Answer 50

Sherman Act