Question 1

Although the sole proprietor's entire personal fortune is at risk,insurance may offset that risk.

Accepted Answer

A) True 
 B)False

Question 2

Paul and Laurie both worked at the mall.They often discussed how frequently they made the decision for the customer as to what should be bought as a gift.They concluded that knowing the merchandise in all the stores as well as they did,they could make a lot of money by doing Christmas shopping for customers.They discussed the idea at length.Laurie's mom,a buyer for a department store in the mall,referred some customers to them.As they gained more and more customers,they wanted to quit their jobs and devote more time to this new business.Laurie's mother would give them $2000,but doesn't want her liability to go beyond that.Given these facts,which of the following is true?

Accepted Answer

A)  Laurie's mother cannot be a limited partner, because it takes four or more general partners before a firm can have a limited partner. 
B)  As long as Laurie's mother does not buy on behalf of the customers hiring Paul and Laurie, she can continue to provide services to them, such as by sending them customers, and can advise them on marketing and other management problems, and not lose a limited partnership status. 
C)  If Laurie's mother does not follow the statutory provisions governing limited partnerships, she could be deemed a general partner and liable for claims beyond her $2000 investment. 
D)  The only way to limit one's liability is to incorporate. 
E)  To protect themselves, all of them should be limited partners. 
A)  Laurie's mother cannot be a limited partner, because it takes four or more general partners before a firm can have a limited partner. 
B)  As long as Laurie's mother does not buy on behalf of the customers hiring Paul and Laurie, she can continue to provide services to them, such as by sending them customers, and can advise them on marketing and other management problems, and not lose a limited partnership status. 
C)  If Laurie's mother does not follow the statutory provisions governing limited partnerships, she could be deemed a general partner and liable for claims beyond her $2000 investment. 
D)  The only way to limit one's liability is to incorporate. 
E)  To protect themselves, all of them should be limited partners.

Question 3

The biggest issue for a sole proprietor is unlimited liability.

Accepted Answer

A) True 
 B)False

Question 4

Gordon was hired to add CD-ROM capacity to Alison Lo's computer.Gordon was instructed to buy (1)a sound card,(2)speakers,and (3)a CD-ROM drive at ROMready,a firm with which Alison had credit.Alison visited the company and said Gordon had authority to act as his agent for the purpose of buying "computer components." While working on the computer,Gordon decided that Alison needed a new and better-designed mouse and a better printer.Gordon went to ROMready and purchased the mouse as an agent of Hank.Not satisfied with printers available at ROMready,he went to Printerhaven Ltd.and bought a printer "as agent for Alison Lo." Given these facts,which of the following is true?

Accepted Answer

A)  When Gordon bought the mouse from ROMready, he exceeded his express authority, but Alison would have to pay for it anyway. 
B)  When Gordon bought the printer from Printerhaven Ltd., Gordon exceeded his express authority, but Alison would have to pay for it anyway. 
C)  If Alison refused to pay for the printer, Printerhaven Ltd. could sue Gordon for breach of contract; Gordon has bought himself a printer and has to pay for it. 
D)  In determining whether or not Gordon could bind Alison in a contract, the law poses this question: Did the acts and words of Gordon lead the company to think that Gordon was an agent for Alison? 
E)  If Gordon exceeds his authority, Hank would sue him for "breach of warranty of authority." 
A)  When Gordon bought the mouse from ROMready, he exceeded his express authority, but Alison would have to pay for it anyway. 
B)  When Gordon bought the printer from Printerhaven Ltd., Gordon exceeded his express authority, but Alison would have to pay for it anyway. 
C)  If Alison refused to pay for the printer, Printerhaven Ltd. could sue Gordon for breach of contract; Gordon has bought himself a printer and has to pay for it. 
D)  In determining whether or not Gordon could bind Alison in a contract, the law poses this question: Did the acts and words of Gordon lead the company to think that Gordon was an agent for Alison? 
E)  If Gordon exceeds his authority, Hank would sue him for "breach of warranty of authority."

Question 5

Discuss the extent of the obligations of the agent to the principal based on her fiduciary duty.

Accepted Answer

It is very important that students under

Question 6

If you hire Gnowsky to act as your agent,which of the following is true with regard to the duties which he owes to you?

Accepted Answer

A)  Gnowsky need not use reasonable care, skill, and diligence in his service to you. 
B)  Even when Gnowsky is acting as your agent, he need not put your interest above his own. 
C)  An agent may delegate his authority without the authorization of his principal. 
D)  His failure to obey you and to act within the authority given him would allow you to sue him for breach of contract. 
E)  Gnowsky need not tell you everything relevant to his task that a reasonable person would consider might affect your decision making. 
A)  Gnowsky need not use reasonable care, skill, and diligence in his service to you. 
B)  Even when Gnowsky is acting as your agent, he need not put your interest above his own. 
C)  An agent may delegate his authority without the authorization of his principal. 
D)  His failure to obey you and to act within the authority given him would allow you to sue him for breach of contract. 
E)  Gnowsky need not tell you everything relevant to his task that a reasonable person would consider might affect your decision making.

Question 7

Explain how the authority of an agent may be terminated.

Accepted Answer

Such authority is usually terminated by

Question 8

Which of the following is correct with respect to the law of partnership?

Accepted Answer

A)  All partnerships must be registered. 
B)  Partnership is generally a less costly method of carrying on business than incorporation. 
C)  All partners have a right to an equal say in the management of the partnership and this cannot be changed by agreement. 
D)  The partnership relationship is governed by legislation that states that profits and losses are to be shared equally, and this cannot be modified by agreement. 
E)  Any major change in the partnership must be made by unanimous agreement, and this cannot be changed by partnership agreement. 
A)  All partnerships must be registered. 
B)  Partnership is generally a less costly method of carrying on business than incorporation. 
C)  All partners have a right to an equal say in the management of the partnership and this cannot be changed by agreement. 
D)  The partnership relationship is governed by legislation that states that profits and losses are to be shared equally, and this cannot be modified by agreement. 
E)  Any major change in the partnership must be made by unanimous agreement, and this cannot be changed by partnership agreement.

Question 9

It is only where a principal consciously ratifies that a contract can be effectively ratified.

Accepted Answer

A) True 
 B)False

Question 10

Novada worked as a salesperson for White Water Yachts Inc.Yates,who was looking at a 30-foot sailboat called the "Mostly Toad," approached him.Yates asked Novada if the boat has been surveyed (inspected)recently,and he was told that it had been just last year and it was in great shape.In fact,it had never been surveyed and had serious fiberglass delaminating problems below in the bilge.Yates bought the boat,and in the first month of sailing the boat delaminated and sank.Yates and his family survived,but both he and his wife suffered some serious long-term injuries.Which of the following is correct with respect to the legal position of the parties?

Accepted Answer

A)  If Novada knew what he was saying was false, Yates could sue Novada and White Water for fraud even if Novada was an independent agent rather than an employee. 
B)  If Novada didn't know what he was saying was false, having mixed this boat up with another, Yates can cannot sue either Novada or White Water for negligence, even if Novada was an independent agent rather than an employee. Salespeople are expected to be enthusiastic. 
C)  Since this is a used boat, this is a "buyer beware" situation, and Yates should have had the boat inspected himself. He has no action against Novada or White Water in these circumstances. 
D)  Yates can only sue White Water if the contract itself specifically referred to a recent survey and this information was inaccurate. 
E)  Yates can sue only the agent in this situation, not the principal. 
A)  If Novada knew what he was saying was false, Yates could sue Novada and White Water for fraud even if Novada was an independent agent rather than an employee. 
B)  If Novada didn't know what he was saying was false, having mixed this boat up with another, Yates can cannot sue either Novada or White Water for negligence, even if Novada was an independent agent rather than an employee. Salespeople are expected to be enthusiastic. 
C)  Since this is a used boat, this is a "buyer beware" situation, and Yates should have had the boat inspected himself. He has no action against Novada or White Water in these circumstances. 
D)  Yates can only sue White Water if the contract itself specifically referred to a recent survey and this information was inaccurate. 
E)  Yates can sue only the agent in this situation, not the principal.

Question 11

If an agency agreement lacks consideration,any agreement the agent enters into on the principal's behalf will be void.

Accepted Answer

A) True 
 B)False

Question 12

A person owing a fiduciary duty must submerge personal interests in favour of the interests of the principal he or she represents.

Accepted Answer

A) True 
 B)False

Question 13

"Partners in a limited liability partnership (LLP)are not liable for the liability of the partnership." Discuss the accuracy of this statement.

Accepted Answer

This statement is not accurate.Professio

Question 14

If a person wants to invest in a partnership but avoid the obligations associated with partnership,what can she do?

Accepted Answer

She can invest as a limited partner.To d

Question 15

Apparent authority is determined by the representation of the agent.

Accepted Answer

A) True 
 B)False

Question 16

Which of the following is correct with respect to limited partnerships?

Accepted Answer

A)  Limited partnership refers to the fact that no more than five people are allowed to be partners in such partnerships. 
B)  Limited partnership refers to the fact that limited partnerships can only carry on in certain kinds of businesses. 
C)  Limited partnership refers to the fact that some partners have limited liability. 
D)  Limited partnership refers to the fact that some partnerships are only created for a limited period of time. 
E)  Limited partnership refers to the fact that the partnership can only issue common shares. 
A)  Limited partnership refers to the fact that no more than five people are allowed to be partners in such partnerships. 
B)  Limited partnership refers to the fact that limited partnerships can only carry on in certain kinds of businesses. 
C)  Limited partnership refers to the fact that some partners have limited liability. 
D)  Limited partnership refers to the fact that some partnerships are only created for a limited period of time. 
E)  Limited partnership refers to the fact that the partnership can only issue common shares.

Question 17

Jones is a partner in a law firm in a small town,and he is also doing legal work out of his home in the evening for himself.Explain the rights of his partners in this situation.

Accepted Answer

He is in the business of practising law

Question 18

Joe was a lawyer and agreed to pay Sam,a banker,25 percent of any fees that he received as a result of mortgage referral business directed his way by Sam.Because of Joe's carelessness,one of the customers referred to him by Sam lost his property.The customer sued both Joe and Sam.Explain the likelihood of his success.

Accepted Answer

No partnership has been create

Question 19

What is the effect of a partnership agreement with a term making it clear that each partner will only be responsible for one-third of the debts and obligations?

Accepted Answer

A partnership agreement cannot change th

Question 20

A principal whose identity is concealed from the third parties with whom the agent is dealing is known as ________.

Accepted Answer

undisclose

Although the sole proprietor's entire personal fortune is at risk,insurance may offset that risk.

The biggest issue for a sole proprietor is unlimited liability.

Discuss the extent of the obligations of the agent to the principal based on her fiduciary duty.

If you hire Gnowsky to act as your agent,which of the following is true with regard to the duties which he owes to you?

Explain how the authority of an agent may be terminated.

Which of the following is correct with respect to the law of partnership?

It is only where a principal consciously ratifies that a contract can be effectively ratified.

If an agency agreement lacks consideration,any agreement the agent enters into on the principal's behalf will be void.

A person owing a fiduciary duty must submerge personal interests in favour of the interests of the principal he or she represents.

"Partners in a limited liability partnership (LLP)are not liable for the liability of the partnership." Discuss the accuracy of this statement.

If a person wants to invest in a partnership but avoid the obligations associated with partnership,what can she do?

Apparent authority is determined by the representation of the agent.

Which of the following is correct with respect to limited partnerships?

Jones is a partner in a law firm in a small town,and he is also doing legal work out of his home in the evening for himself.Explain the rights of his partners in this situation.

What is the effect of a partnership agreement with a term making it clear that each partner will only be responsible for one-third of the debts and obligations?

A principal whose identity is concealed from the third parties with whom the agent is dealing is known as ________.

Managing Your Legal Affairs

Introduction to the Legal System

The Resolution of Disputesthe Courts and Alternatives to Litigation

Intentional Torts and Torts Impacting Business

Negligence, Professional Liability, and Insurance

The Elements of a Contractconsensus and Consideration

The Elements of a Contract capacity, Legality, and Intention

Factors Affecting the Contractual Relationship

The End of the Contractual Relationship

Employment

Corporations

Real, Personal, and Intellectual Property

Information Technology and the Internet

Sales and Consumer Protection

Priority of Creditors

Filters

Exam 11: Agency and Partnership

Although the sole proprietor's entire personal fortune is at risk,insurance may offset that risk.

The biggest issue for a sole proprietor is unlimited liability.

Discuss the extent of the obligations of the agent to the principal based on her fiduciary duty.

If you hire Gnowsky to act as your agent,which of the following is true with regard to the duties which he owes to you?

Explain how the authority of an agent may be terminated.

Which of the following is correct with respect to the law of partnership?

It is only where a principal consciously ratifies that a contract can be effectively ratified.

If an agency agreement lacks consideration,any agreement the agent enters into on the principal's behalf will be void.

A person owing a fiduciary duty must submerge personal interests in favour of the interests of the principal he or she represents.

"Partners in a limited liability partnership (LLP)are not liable for the liability of the partnership." Discuss the accuracy of this statement.

If a person wants to invest in a partnership but avoid the obligations associated with partnership,what can she do?

Apparent authority is determined by the representation of the agent.

Which of the following is correct with respect to limited partnerships?

Jones is a partner in a law firm in a small town,and he is also doing legal work out of his home in the evening for himself.Explain the rights of his partners in this situation.

What is the effect of a partnership agreement with a term making it clear that each partner will only be responsible for one-third of the debts and obligations?

A principal whose identity is concealed from the third parties with whom the agent is dealing is known as ________.

Managing Your Legal Affairs

Introduction to the Legal System

The Resolution of Disputesthe Courts and Alternatives to Litigation

Intentional Torts and Torts Impacting Business

Negligence, Professional Liability, and Insurance

The Elements of a Contractconsensus and Consideration

The Elements of a Contract capacity, Legality, and Intention

Factors Affecting the Contractual Relationship

The End of the Contractual Relationship

Employment

Corporations

Real, Personal, and Intellectual Property

Information Technology and the Internet

Sales and Consumer Protection

Priority of Creditors

Filters