Question 1

Sam hires Joe to negotiate and sign a contract with Ken on Sam's behalf.Which of the following is true?

Accepted Answer

A)  If Joe acts outside his express authority and negotiates and signs the contract with Ken, Sam may not be a party to that contract. 
B)  If Joe acts outside his implied and express authority, Sam will owe him for his services. 
C)  If Joe acts within his apparent authority, but outside his express or implied authority, Sam will be bound by the contract, but may sue Joe for breach of his agency contract. 
D)  If Joe acts outside express, implied, and apparent authority, Sam is not bound by the contract, even if he ratifies the contract. 
E)  If Joe acts outside his express, implied, and apparent authority, he could be sued by Sam, but not by Ken, because he has no contractual relationship with Ken. 
A)  If Joe acts outside his express authority and negotiates and signs the contract with Ken, Sam may not be a party to that contract. 
B)  If Joe acts outside his implied and express authority, Sam will owe him for his services. 
C)  If Joe acts within his apparent authority, but outside his express or implied authority, Sam will be bound by the contract, but may sue Joe for breach of his agency contract. 
D)  If Joe acts outside express, implied, and apparent authority, Sam is not bound by the contract, even if he ratifies the contract. 
E)  If Joe acts outside his express, implied, and apparent authority, he could be sued by Sam, but not by Ken, because he has no contractual relationship with Ken.

Question 2

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

Accepted Answer

A)  A partnership cannot be created inadvertently. 
B)  Joint and several liability means that each partner can be sued several times. 
C)  Each partner is vicariously liable for the wrongful acts of their partners committed in the course of the partnership business. 
D)  Partners are only liable for the torts of their partners if they in fact knew that the wrongful conduct was taking place. 
E)  Partners have unlimited liability, meaning that they can lose up to the amount they have invested in the business. 
A)  A partnership cannot be created inadvertently. 
B)  Joint and several liability means that each partner can be sued several times. 
C)  Each partner is vicariously liable for the wrongful acts of their partners committed in the course of the partnership business. 
D)  Partners are only liable for the torts of their partners if they in fact knew that the wrongful conduct was taking place. 
E)  Partners have unlimited liability, meaning that they can lose up to the amount they have invested in the business.

Question 3

Jones is a partner in a law firm in a small town,and is also doing legal work out of his home in the evening for himself.Which of the following statements is correct with respect to his responsibility for the money he earns?

Accepted Answer

A)  Jones has no responsibility; the money he makes by this extra work is his. 
B)  If Jones did not have the consent of his partners, Jones must pay over all the money he makes through his business at home to the partnership. 
C)  If Jones is a one-third partner in the law firm, he need only pay over one-third of what he makes. 
D)  Such conduct will automatically dissolve the partnership, but he can keep what he has made. 
E)  Jones has a duty to tell the other partners, but the money is his and he can keep up the extra work regardless of the other partners consent. 
A)  Jones has no responsibility; the money he makes by this extra work is his. 
B)  If Jones did not have the consent of his partners, Jones must pay over all the money he makes through his business at home to the partnership. 
C)  If Jones is a one-third partner in the law firm, he need only pay over one-third of what he makes. 
D)  Such conduct will automatically dissolve the partnership, but he can keep what he has made. 
E)  Jones has a duty to tell the other partners, but the money is his and he can keep up the extra work regardless of the other partners consent.

Question 4

A recent article in the Lawyers Weekly began "Step aside,wrongful dismissal: the law of fiduciary duties is where you'll find the hottest legal action these days"! Which of the following is false with regard to the meaning of "fiduciary duty"?

Accepted Answer

A)  Fiduciary law is based on the principle of acting with utmost good faith. 
B)  Fiduciary law governs situations in which one party places trust and confidence in another who consents to act in accordance with that trust. 
C)  In some fields, fiduciary duties are imposed both by the common law and by statute. 
D)  An agent must place the interests of his principal above all except the law. 
E)  The principal owes the agent a fiduciary duty just as the agent owes it to his principal. 
A)  Fiduciary law is based on the principle of acting with utmost good faith. 
B)  Fiduciary law governs situations in which one party places trust and confidence in another who consents to act in accordance with that trust. 
C)  In some fields, fiduciary duties are imposed both by the common law and by statute. 
D)  An agent must place the interests of his principal above all except the law. 
E)  The principal owes the agent a fiduciary duty just as the agent owes it to his principal.

Question 5

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

Accepted Answer

A)  Every partner is responsible for every contract entered into by his or her partner. 
B)  Partners are only responsible for contracts entered into by their partnership if the third party knew that the person they were dealing with was a partner in the partnership. 
C)  Partners are responsible for any contracts entered into by their partners related to the partnership business. 
D)  A partner is responsible for contracts with third parties entered into by their partners only where it has been clearly stated by the partner to the third party that he is entering the contract on behalf of the partnership. 
E)  Partners cannot bind their partners in contract without specific written authority. 
A)  Every partner is responsible for every contract entered into by his or her partner. 
B)  Partners are only responsible for contracts entered into by their partnership if the third party knew that the person they were dealing with was a partner in the partnership. 
C)  Partners are responsible for any contracts entered into by their partners related to the partnership business. 
D)  A partner is responsible for contracts with third parties entered into by their partners only where it has been clearly stated by the partner to the third party that he is entering the contract on behalf of the partnership. 
E)  Partners cannot bind their partners in contract without specific written authority.

Question 6

Joe R.notified his partners in writing that he would be retiring from the business partnership at the end of 2011.It was acknowledged and agreed upon and,at year end,the remaining partners paid him for his interest in the partnership.In February 2012,one of the remaining partners misapplied some trust funds that a long-time client had placed in the care of the partnership for the purchase of a hotel.The partnership was sued,but the assets of the partnership were not sufficient to satisfy the judgment.The successful plaintiff went against the personal assets of the partners,including those of Joe R.What is the likely outcome?

Accepted Answer

A)  Joe R. is not liable because he had retired from the partnership at year end and had properly notified his partners. 
B)  Joe R. is not liable because he had had nothing whatsoever to do with the misapplication of the trust money. 
C)  Joe R. is liable if he failed to give proper notice to outsiders, namely, the long-time client whose funds were misapplied. 
D)  Joe R. is only liable for his share of the losses even if the other partners don't have the assets to pay. 
E)  Joe R. is not liable since he was not a partner when the misapplication happened. 
A)  Joe R. is not liable because he had retired from the partnership at year end and had properly notified his partners. 
B)  Joe R. is not liable because he had had nothing whatsoever to do with the misapplication of the trust money. 
C)  Joe R. is liable if he failed to give proper notice to outsiders, namely, the long-time client whose funds were misapplied. 
D)  Joe R. is only liable for his share of the losses even if the other partners don't have the assets to pay. 
E)  Joe R. is not liable since he was not a partner when the misapplication happened.

Question 7

Which of the following is the proper definition of a partnership as set out in the Partnership Act?

Accepted Answer

A)  Partnership exists where two or more persons carry on business together with a view towards profits. 
B)  A partnership exists where any business is carried on with a view towards profits. 
C)  A partnership is created where a corporation with shareholders is registered with the federal government. 
D)  A partnership is only created where the partners actually share the profits from a business. 
E)  A partnership exists only where two or more people enter into a written agreement to be partners. 
A)  Partnership exists where two or more persons carry on business together with a view towards profits. 
B)  A partnership exists where any business is carried on with a view towards profits. 
C)  A partnership is created where a corporation with shareholders is registered with the federal government. 
D)  A partnership is only created where the partners actually share the profits from a business. 
E)  A partnership exists only where two or more people enter into a written agreement to be partners.

Question 8

Distinguish between a sole proprietorship and a corporation.

Accepted Answer

The sole proprietorship is sim

Question 9

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

Accepted Answer

A)  A limited partnership is created where all of the partners state in the partnership agreement that they will not be responsible for debts arising out of the partnership business and register as such with the government. 
B)  A limited partner is totally protected and can lose no money. 
C)  A limited partner can lose his status as a limited partner if he participates in the management of the business. 
D)  There can be no limited partnerships in Canada. If limited liability is desired, a corporation must be created. 
E)  There can be only one limited partner in any partnership, no matter how many partners are involved. 
A)  A limited partnership is created where all of the partners state in the partnership agreement that they will not be responsible for debts arising out of the partnership business and register as such with the government. 
B)  A limited partner is totally protected and can lose no money. 
C)  A limited partner can lose his status as a limited partner if he participates in the management of the business. 
D)  There can be no limited partnerships in Canada. If limited liability is desired, a corporation must be created. 
E)  There can be only one limited partner in any partnership, no matter how many partners are involved.

Question 10

Explain under what circumstances a principal who is not an employer will be held responsible for the wrongful acts of his agent.

Accepted Answer

Where the agent has

Question 11

Which one of the following statements is correct with respect to sole proprietorships?

Accepted Answer

A)  A sole proprietorship is a separate legal entity with one shareholder. 
B)  A sole proprietorship involves limited liability. 
C)  The sole proprietor is a society under the Societies Act. 
D)  A sole proprietorship involves unlimited liability for the proprietor. 
E)  The sole proprietor is restricted to service type businesses. 
A)  A sole proprietorship is a separate legal entity with one shareholder. 
B)  A sole proprietorship involves limited liability. 
C)  The sole proprietor is a society under the Societies Act. 
D)  A sole proprietorship involves unlimited liability for the proprietor. 
E)  The sole proprietor is restricted to service type businesses.

Question 12

What are the advantages and disadvantages of being a sole proprietor?

Accepted Answer

Advantages-little outside inte

Question 13

Chris was a systems analyst hired to determine the best system for a retail china shop.After a careful analysis of the shop's needs and the available software,Chris presented a written reportthat was approved by the owner of the business.Chris was paid his fee and was asked by the owner if he would act as his agent in purchasing the hardware and software recommended in the report.The purchase was not to exceed $40 000 and the commission was to be $1000.Chris agreed.Read each of the following separately and indicate which is true.

Accepted Answer

A)  The agreement to act as agent fails to be a valid agency contract because it is not in writing. 
B)  If Chris buys the hardware and software himself for $36 000 and sells it to the owner for $39 000, he is entitled to his commission because the price to the owner is still within the price allowed. 
C)  Chris will not be in breach of his fiduciary duty if he buys the recommended system from a firm in which he has an interest, even if he does not mention that fact to the owner. 
D)  Chris could be in breach of his duties if he delegated the task to someone else. 
E)  Chris is entitled to accept a commission from both the seller and the purchaser, as long as the total price paid by the purchaser is less than $40 000 and the hardware and software is comparable to that recommended in the report. 
A)  The agreement to act as agent fails to be a valid agency contract because it is not in writing. 
B)  If Chris buys the hardware and software himself for $36 000 and sells it to the owner for $39 000, he is entitled to his commission because the price to the owner is still within the price allowed. 
C)  Chris will not be in breach of his fiduciary duty if he buys the recommended system from a firm in which he has an interest, even if he does not mention that fact to the owner. 
D)  Chris could be in breach of his duties if he delegated the task to someone else. 
E)  Chris is entitled to accept a commission from both the seller and the purchaser, as long as the total price paid by the purchaser is less than $40 000 and the hardware and software is comparable to that recommended in the report.

Question 14

Which one of the following statements is correct with respect to the creation of a partnership agreement?

Accepted Answer

A)  Where two people agree to enter into a partnership, there is no partnership created unless all of the elements of a contract are present. 
B)  A partnership can be created only by contract. 
C)  For a partnership to exist, the relationship giving rise to it must be of an ongoing business nature, not a one-time promotion. 
D)  A partnership can be created by an intention to share the revenues between the partners. 
E)  For a person to be a limited partner, there must be at least two general partners. 
A)  Where two people agree to enter into a partnership, there is no partnership created unless all of the elements of a contract are present. 
B)  A partnership can be created only by contract. 
C)  For a partnership to exist, the relationship giving rise to it must be of an ongoing business nature, not a one-time promotion. 
D)  A partnership can be created by an intention to share the revenues between the partners. 
E)  For a person to be a limited partner, there must be at least two general partners.

Question 15

One advantage of sole proprietorships is that under the principle of vicarious liability,the sole proprietor is not responsible for any tort committed by an employee during the course of employment.

Accepted Answer

A) True 
 B)False

Question 16

Which one of the following situations will result in a partnership existing? Assume no corporation has been created.

Accepted Answer

A)  Joe and Mary own a house together and share the income from it. 
B)  Joe pays back a debt to Harry by giving Harry a percentage of the profits from his business. 
C)  Joe and Mary own a shoe store business together and share the profits. 
D)  Employees are given bonuses because of increased profits. 
E)  A lawyer and a real estate agent split the commission. 
A)  Joe and Mary own a house together and share the income from it. 
B)  Joe pays back a debt to Harry by giving Harry a percentage of the profits from his business. 
C)  Joe and Mary own a shoe store business together and share the profits. 
D)  Employees are given bonuses because of increased profits. 
E)  A lawyer and a real estate agent split the commission.

Question 17

Which one of the following statements is correct with respect to sole proprietorships?

Accepted Answer

A)  The sole proprietor has limited liability. 
B)  The sole proprietor need not adhere to any licensing and government regulations. 
C)  The sole proprietor must consult with the other owners before making any major decisions regarding the business. 
D)  The sole proprietor has the same extent of liability as a shareholder. 
E)  The sole proprietor is responsible for the torts committed by an employee that take place during the course of business. 
A)  The sole proprietor has limited liability. 
B)  The sole proprietor need not adhere to any licensing and government regulations. 
C)  The sole proprietor must consult with the other owners before making any major decisions regarding the business. 
D)  The sole proprietor has the same extent of liability as a shareholder. 
E)  The sole proprietor is responsible for the torts committed by an employee that take place during the course of business.

Question 18

Joe was a salesperson,newly hired by Radio Hut.On his first day on the job,he was left in charge of the store while the manager and the other salesmen went to lunch.They specifically told him not to sell anything over $50 but to just tell the customer to come back in an hour when they would have returned.While they were at lunch,a customer came in and decided to purchase a new stereo TV set and several accessories.The total sales price was $1600,and the customer couldn't wait.Joe sold her the merchandise at a $400 discount.When the customer returned the next day to pick up the goods,the manager refused to go through with the deal.Explain the manager's legal obligations in these circumstances.

Accepted Answer

Joe had apparent authority and

Question 19

When two people enter into a partnership by agreement but neglect to set out the terms of such agreement,or where the parties becomes partners inadvertently,the terms and arrangements of that partnership are set out where?

Accepted Answer

The answer of When two people enter into a partnership...

Question 20

In the process of assembling land for Ace Construction Ltd.to build a supermarket,Joe entered into a contract with the seller Sam.In which of the following situations would Sam be able to sue the principal Ace?

Accepted Answer

A)  Where Joe revealed that he was acting as an agent, but did not disclose that he was acting for Ace in particular, and exceeded both his apparent and real authority. Ace did not ratify the contract. 
B)  Where Joe disclosed that he was acting for Ace but made the contract "subject to ratification." 
C)  Where Joe was acting outside his authority and did not disclose that he was acting for the Ace. Sam was aware of Joe acting independently at the time he entered into the contract. 
D)  Where Joe exceeded his actual authority but where Ace had led Sam to believe Joe had the authority. 
E)  Where Joe exceeded his apparent and actual authority. 
A)  Where Joe revealed that he was acting as an agent, but did not disclose that he was acting for Ace in particular, and exceeded both his apparent and real authority. Ace did not ratify the contract. 
B)  Where Joe disclosed that he was acting for Ace but made the contract "subject to ratification." 
C)  Where Joe was acting outside his authority and did not disclose that he was acting for the Ace. Sam was aware of Joe acting independently at the time he entered into the contract. 
D)  Where Joe exceeded his actual authority but where Ace had led Sam to believe Joe had the authority. 
E)  Where Joe exceeded his apparent and actual authority.

Sam hires Joe to negotiate and sign a contract with Ken on Sam's behalf.Which of the following is true?

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

Jones is a partner in a law firm in a small town,and is also doing legal work out of his home in the evening for himself.Which of the following statements is correct with respect to his responsibility for the money he earns?

A recent article in the Lawyers Weekly began "Step aside,wrongful dismissal: the law of fiduciary duties is where you'll find the hottest legal action these days"! Which of the following is false with regard to the meaning of "fiduciary duty"?

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

Which of the following is the proper definition of a partnership as set out in the Partnership Act?

Distinguish between a sole proprietorship and a corporation.

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

Explain under what circumstances a principal who is not an employer will be held responsible for the wrongful acts of his agent.

Which one of the following statements is correct with respect to sole proprietorships?

What are the advantages and disadvantages of being a sole proprietor?

Which one of the following statements is correct with respect to the creation of a partnership agreement?

One advantage of sole proprietorships is that under the principle of vicarious liability,the sole proprietor is not responsible for any tort committed by an employee during the course of employment.

Which one of the following situations will result in a partnership existing? Assume no corporation has been created.

Which one of the following statements is correct with respect to sole proprietorships?

When two people enter into a partnership by agreement but neglect to set out the terms of such agreement,or where the parties becomes partners inadvertently,the terms and arrangements of that partnership are set out where?

In the process of assembling land for Ace Construction Ltd.to build a supermarket,Joe entered into a contract with the seller Sam.In which of the following situations would Sam be able to sue the principal Ace?

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

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Corporations

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Exam 11: Agency and Partnership

Sam hires Joe to negotiate and sign a contract with Ken on Sam's behalf.Which of the following is true?

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

Jones is a partner in a law firm in a small town,and is also doing legal work out of his home in the evening for himself.Which of the following statements is correct with respect to his responsibility for the money he earns?

A recent article in the Lawyers Weekly began "Step aside,wrongful dismissal: the law of fiduciary duties is where you'll find the hottest legal action these days"! Which of the following is false with regard to the meaning of "fiduciary duty"?

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

Which of the following is the proper definition of a partnership as set out in the Partnership Act?

Distinguish between a sole proprietorship and a corporation.

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

Explain under what circumstances a principal who is not an employer will be held responsible for the wrongful acts of his agent.

Which one of the following statements is correct with respect to sole proprietorships?

What are the advantages and disadvantages of being a sole proprietor?

Which one of the following statements is correct with respect to the creation of a partnership agreement?

One advantage of sole proprietorships is that under the principle of vicarious liability,the sole proprietor is not responsible for any tort committed by an employee during the course of employment.

Which one of the following situations will result in a partnership existing? Assume no corporation has been created.

Which one of the following statements is correct with respect to sole proprietorships?

When two people enter into a partnership by agreement but neglect to set out the terms of such agreement,or where the parties becomes partners inadvertently,the terms and arrangements of that partnership are set out where?

In the process of assembling land for Ace Construction Ltd.to build a supermarket,Joe entered into a contract with the seller Sam.In which of the following situations would Sam be able to sue the principal Ace?

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