Exam 14: Legality

E-mation,Inc.hires Marvin to steal trade secrets from one of its competitors for $10,000.Marvin demands half of the money up front.E-mation pays Marvin $5,000,but Marvin decides not to pursue theft of the trade secrets.E-mation sues Marvin for the return of the $5,000.What will the court do with this contract?

Which of the following can be characterized as an exculpatory clause?

The UCC deals with unconscionability in a contract by providing that a court may

When a licensing requirement is designed merely to raise revenue,a contract made by an unlicensed person is generally enforceable.

Barbara,a skilled welder,was hired at Mainco Enterprises for a welding position.She was asked to sign a non-compete clause limiting future employment if she left Mainco.A court would be very likely to enforce the non-compete clause unless the time or geographic restriction is unreasonable.

According to Section 2-302 of the UCC,if a court finds as a matter of law that a clause of a contract was unconscionable at the time the contract was made,the court must refuse to enforce the contract.

A gambling contract is illegal unless it is a type of wagering specifically authorized by state statute.

Virginia borrowed money from G & L Lending at 35% interest per year.The state maximum interest rate is 20% per year.Virginia defaulted on the loan.What amount can G & L collect from Virginia?

When Randy,an electrician,accepted a job with Buren Construction,Randy signed the following agreement: "Upon termination of my employment with Buren Construction,I agree never to work for another employer as an electrician." If Randy resigns from Buren Construction,this agreement would be upheld under the theory of freedom of contract.

Usury laws are designed to protect consumers from

Differentiate between licensing requirements designed to protect the public and those designed to generate revenue.

In a non-compete agreement,the term "ancillary" means that

Rudolph overhears Macy's plans to go skydiving over spring break.Not really knowing Macy,but figuring it's worth a chance,Rudolph rushes out and buys an insurance policy for $100,000 on Macy's life.Macy does in fact meet her demise jumping out of the airplane.Rudolph can collect the $100,000.

What are the two most common settings for legitimate non-compete agreements?

Marcy and Elliot are both sophisticated merchants who deal in diamonds.Marcy contracted to purchase a diamond for $20,000.The day after the purchase,Marcy took the diamond to a jeweler's show but the highest offer for the diamond was only $10,000.Is Marcy's contract for purchase of the diamond for $20,000 unconscionable?

An exculpatory clause is generally unenforceable when

Wendell,new to the area,selects a doctor from the telephone book and visits that doctor to have a splinter extracted.Unbeknownst to Wendell,the doctor has never passed the state licensing exams.Later,when Wendell discovers the truth,he refuses to pay his bill.If the doctor sues for recovery of the fee,will the court support the doctor's claim?

Asher buys a linen suit from Miriam and gives it to his father,Moises.Moises takes the suit to Vanessa,who runs a local dry cleaner,to have the suit cleaned and pressed.Who is the bailee?

Cynthia and Brian were friends.Brian was a dare devil.Because of his antics,Cynthia thought that Brian wasn't long for this life.Cynthia purchased a life insurance policy on Brian's life.Subsequently,Brian was killed in a car accident.Since Cynthia and Brian were friends,Cynthia had an insurable interest in his life and will be entitled to the insurance proceeds.

An insurance contract is NOT considered to be an illegal form of "wagering" because