1.Zehra is an employee of Claire. It is payday, but Claire does not have the money to pay Zehra right away, so she signs a simple statement that says:

"I owe Zehra $500 for her work this week." Claire then hands this paper to Zehra. This document is:

a. A worthless piece of paper.

b. A check.

c. A negotiable instrument.

d. A promissory note.

e. An "I Owe You" - just evidence of a debt owed.

2.Wanda borrows $2,000 from her friend Jack, and signs a Promissory Note in which she agrees to pay Jack $100.00 per month until the debt is paid back (along with 10% interest on the unpaid balance).Wanda makes two payments as agreed, then makes no further payments.After repeated efforts to collect the money from Wanda, Jack finds out that Wanda has declared a Chapter 7 Bankruptcy, and has listed the $1,800 balance that she still owed Jack, as one of her debts to be discharged!Assuming that Wanda has no assets left (other than her clothes), what will Jack get from Wanda's bankruptcy estate, or from Wanda in the future?

a. Jack is out of luck!If there are no assets belonging to the person who has declared bankruptcy, the unsecured creditors like Jack will get nothing.

b. Jack is a secured creditor, so his debt cannot be discharged in bankruptcy.

3.Hanalei owns Hanalei's Security Company, which is in business to provide security for private elementary schools in Seattle.One of the security guards hired by the company recently sexually abused a child at one of the schools that the company has a contract with.It turns out that no background check was ever done on this guard, because he was a high-school buddy of the owner of the company, Hanalei.Assuming the child's parents file a lawsuit against both the guard and the company:

a.the guard will be the only defendant liable

b.the company will be the only defendant liable

c.both the guard and the company will be liable

d.neither the guard nor the company will be liable

4.You have found evidence that your company Vice President of Finance has been hiring independent-contractor truck drivers to take toxic waste from the company manufacturing plant, with directions for the drivers to take this waste out to the desert near Yakima, and dump it there, rather than to a toxic-waste disposal site.This has saved the company about $100,000 in disposal costs, so the Net Profit looks better this year.The VP of Finance will be due for a $5,000 bonus, based on this "cost savings," although of course if anyone in the public finds out about it, the VP and the company itself could be charged with both state and federal crimes. Assuming that you report these facts to the state or federal government, who will be able to charge the VP with the criminal behavior?

a.the company alone

b.the government alone

c.the government and the company have to agree

5. Rob (a Single man) works as an appliance-repair technician for a nationwide appliance-service company, but the office he works for is located in Seattle.The company has given Rob an "Employee's Handbook" that lists all of the employment benefits available to employees who have made it successfully through the first 6 months of employment.Rob has just completed his first 6 months with the company. In the Handbook, Rob sees that Married employees are to be provided with 100% pre-paid health-insurance for the Employee and the Employee's spouse, and any children under the age of 21 still living at home.For Single employees (never married or divorced or widowed), the company will only give $50 per month for the Employee to use to cover part of the costs of health insurance.Rob checks around and finds out that he will need at least $300 per month to cover his health insurance.

Rob can challenge these discriminatory benefits, based on the following Revised Code of Washington statute:

a.RCW 49.60.030

b.RCW 49.60.180

c.RCW 49.44.090

6.The city has offered to purchase your house for $200,000, because they want to expand a city park that is right next to your house.You do not want to sell to the city, and besides, you think the house is really worth $300,000.

a.The city is out of luck.

b.The city can force you to sell for $200,000, under the power of eminent domain.

c.The city can force you to sell for $200,000, under the power of foreclosure.

d.The city can force you to sell for $200,000, under the power of judicial review.

e.The city can force you sell, but you have the right to a trial to establish the fair market value of the property.

7.On February 15, 2020, Bill makes a written offer to buy Barbara's 4-unit apartment house, for $500,000, with the purchase to close on April 30, 2020.Barbara signs the agreement, and sends back one copy to Bill.If Barbara changes her mind, and refuses to sell, Bill can go to court and get a court to force Barbara to sell the property, under the legal concept of:

a.eminent domain

b.specific performance

c.absolute performance

d.partial performance

8.True or False The Uniform Commercial Code (UCC) governs basic employment contracts between employers and employees.

9. Jennifer applies for, and receives an interview appointment with a prospective employer for a real-estate loan officer position.Jennifer is in a wheelchair, as she had polio when she was a child, and her use of her legs is quite limited. When she arrives, the interviewer says:"Oh, sorry, we only employ people who can stand upright, because they have to be able to greet our customers "eye-to-eye" when the customers come in the see us."Jennifer is not interviewed, and not offered a job.She meets all of the advertised requirements for the job, and has excellent references and previous job experiences, and excellent educational background for this position.Does Jennifer have a valid legal claim under federal law, against this employer?The employer is a bank with several branches, and about 200 employees.

a.No, Jennifer does not have a valid legal claim, as the employer is not discriminating against her on the basis of race, color, religion, national origin, or sex as provided by the federal Civil Rights Act of 1964.

b.No, Jennifer does not have a valid legal claim, as the employer does not have enough employees to be covered by the federal Civil Rights Act of 1964.

c.Yes, Jennifer does have a valid legal claim against the employer, on the basis of the Federal Equal Pay Act.

d.Yes, Jennifer does have a valid legal claim against the employer, on the basis of the Americans with Disabilities Act.

10. Which one of the following statements could create an express warranty?

a."This is the best car on the market!"

b."This is a classic car - its value should just go up over time!"

c."These tires have at least 10,000 miles of legal wear left!"

d."This is a cream-puff car!"

e.None of the above

11. True or FalseUnder the UCC, an express warranty may be created by a Seller showing a sample of a particular item to a Buyer, and the Buyer relying on that sample to make a purchase decision.

12.Which one of the following warranties only applies if the Seller is a Merchant?

a.Express warranties

b.Implied warranty of fitness for a particular purpose

c.Implied warranty of merchantability

d.Implied warranty of good title

e.None of the above

13.True or FalseRonald and Bill have entered into a written contract, dated February 13, 2020, whereby Bill will pay Ronald $10,000 for Ronald's car, on March 1, 2020.At this price, Ronald will have made a profit on the sale of the car, in the amount of $4,000 over what he paid for it!3 days later, Bill sends Ronald a letter in which he states:"I have changed my mind - I will not be buying your car."When Ronald tries to sell the car to someone else, the highest price he can get is $9,000.Ronald has a valid claim against Bill for $1,000 in "lost profits."

14. Marnie is a contractor who builds smaller housing developments like duplexes, triplexes, and sometimes up to 12 units.Vy enters into a contract with Marnie for Marnie to build Vy a 10-unit apartment building, located on a property that Vy owns in the U District in Seattle. The construction materials will cost about 30% of the total costs.Labor to build the building will cost about 70% of the total costs.

A) this contract will probably not be covered by the UCC, because the dominant element of the contract will be the construction services.

B) this contract will probably be covered by the UCC, because this is a "sale of goods"

FACTS for 15 & 16.Dianna makes an oral offer to Luisa:"If you cater my Thanksgiving-Day dinner for 10 guests, with traditional dishes like roast turkey with stuffing, baked yams, sauted green beans, egg nog, apple sauce, apple cider, and pumpkin pie with whipped cream, I will pay you $1,000 on the Monday after the holiday."Luisa accepts and promises to be there!Luisa does a great job with the catering, and all the guests tell Dianna how wonderful the meal was.On Monday following the holiday, Luisa asks Dianna for payment. Dianna hands over a check for just $600.00, saying:"Well, what you did bring over was good, but technically you breached the contract, since you neglected to bring any egg nog, so I am deducting a reasonable amount from the total."You can assume that $50 would be enough to usually cover the cost of egg nog.Luisa comes to you for advice, because she wants the remaining $400 due on their agreement!

15.First - what kind of contract did they have, if any?

a. a unilateral oral contract for sale of goods

b.a unilateral oral contract for services

c.a bilateral oral contract for sale of goods

d.a bilateral oral contract for services

e.no contract at all - but Luisa should still win by Quasi-contract

16. IF Luisa takes this to court, we would expect the judge to:

A.Rule that Luisa committed a substantial breach of their agreement, so refuse to order Dianna to pay Luisa any more compensation.

B.Rule that Luisa committed a minor breach of their agreement.The judge would deduct a reasonable sum ($50 or so) from the total contract price, and order Dianna to pay Luisa the remaining part of the contract price (about $350).

C.Rule that there was no breach of the agreement, and order Dianna to pay the full remaining balance of the contract price ($400).

17.True or FalseUnder the Washington state "statute of frauds" (a copy is in Canvas under Files - Washington State requirements for written contracts), an apartment lease for 3 years would have to be in writing.

18.On January 1, 2020, Marty calls his neighbor Ned over, and says:"I have something for you - I think you will like it!"He hands Ned a wrapped package, and says "Happy Birthday, Ned!"Ned opens the package, and finds 2 tickets to the 2020 SuperBowl.Ned thanks Marty, they have a beer together, then Ned goes home.Two days later, Marty finds out Ned was the one who had been sending Marty obscene e-mail messages for several months.Marty demands the SuperBowl tickets back, but Ned refuses.Result if this goes to court?

a.There was a completed gift from Marty to Ned, and Ned does not have to return the tickets.

b.There was a completed gift from Marty to Ned, but Ned will still have to return the tickets.

c.This is not a "gift" issue at all - the issue is whether there was a bailment of the tickets!

19.Roger offers, in writing, to sell Luanne 20,000 shares of stock in Costco, Inc., for $200,000 total.Luanne sends Roger a written acceptance.Later on, if there is any dispute regarding this agreement, the court will refer to which set of laws to resolve this matter?

a.The UCC Article 2A.

b.The UCC Article 9.

c.The UCC Article 2.

d.The common-law of contracts.

20.On September 12, 2019, Damon orally agrees to paint the exterior of Matt's Warehouse building in Boise, Idaho, for $30,000, to be completed by November 1, 2019.Matt promises to pay Damon by November 5, 2019, assuming the work has been completed.Damon and his assistants work very diligently, and complete the project early - on October 23!Matt still has not paid Damon as ofDecember 1, 2019, and he sent Damon a note indicating that he would not be paying Damon.If Damon has to take Matt to court on this matter:

a.Matt will win, as the contract price was over $500, and it was not in writing, so not enforceable!

b.Matt will lose, as Damon had a binding, enforceable contract, and Damon fully performed on the contract.

21.Emmett has promised to wash Erica's car every Saturday from now (February 15, 2020) through Erica's graduation - on June 20, 2020.Erica has promised to pay Emmett $20 each week for this work.They are both over 18.The promises are oral.This is an example of a(n) _______________ contract.

A)void

B)unenforceable

C)formal

D)executed

E)valid, oral

22.John is 80, and was thinking of selling his house and moving to a smaller house or apartment.He casually mentions this to his next-door neighbor Olena.Olena immediately offers to buy John's house for $175,000.John has owned the house for many years, and only paid $20,000 for it, so he thinks this is a good deal.They sign a simple real-estate sales contract form.Later, John lets his children know what he has done, and they are outraged - they let John know that the house is probably worth $250,000 or more.John should be able to get out of this agreement, on the basis of "lack of mutual consideration" on the part of Olena. True or False

23. Morgan is a student at NSC.She has two laptop computers, and decides she only needs one.She puts an advertisement out on one of the NSC bulletin boards, offering to sell one of the laptops for half of what she bought it for - just $1,000, and indicating that the price would be good until 5 pm on February 20, 2020.CJ sees the ad, and calls Morgan at noon on February 18, and tells Morgan that he wants to buy Morgan's computer, at the price shown on the bulletin board.Morgan tells CJ that Morgan has changed her mind - she is not going to sell it at the $1,000 price after all - Morgan wants $1,300 now. CJ threatens to take Morgan to court - claiming that this situation is covered by the "firm offer rule."Is Morgan's advertisement covered by the firm offer rule of the UCC? This is the first time Morgan has ever tried to sell a computer.

a.yes - because the ad was in writing

b.yes - because Morgan qualifies as a merchant

c.no - because the ad was in writing

d.no - because Morgan qualifies as a merchant

e.no - because Morgan is not a merchant

24.There is a clause in a contract between a property owner and a building contractor (for the construction of a house for $250,000).It states that if the contractor does not complete the house by the agreed completion date (February 25, 2020), then there will be a $10,000 reduction in the total amount due to the contractor.This clause would be referred to as:

a.a specific performance clause

b.a liquidated damages clause

c.an unconscionable clause

d.an un-enforceable clause

25.Nita walks into Hank's Hardware Store and says, "I need metal storage shelves that can hold 500 pounds."Hank, the owner of the store, directs her to a metal storage shelving system, which Hank indicates will hold up to 800 pounds!Nita then buys the shelves.When Nita puts packages onto the bottom shelf, weighing 450 pounds, the shelf breaks, and Nita was hurt when the shelf broke.Hank's Hardware Store is liable for Nita's injuries under which legal theory:

a.breach of warranty of merchantability

b.breach of warranty of title

c.product liability

d.breach of warranty for particular purpose

e.breach of Magnuson-Moss Warranty Act

26.Which one of the following statements by a car seller could create an express warranty?

a."This is the best car on the market!"

b."This is a classic car - its value should just go up over time!"

c."These tires have at least 10,000 miles of legal wear left!"

d."This is a cream-puff car!"

e.None of the above

27.Marci went to an interview for a position with Mama Mia's Italian Kitchen in the Little Italy neighborhood in North Seattle.Mama Mia's has about 25 full-time employees.Mama, the owner of the restaurant, takes one look at Marci, and tells her to go home - saying:"We only hire people with Italian heritage in our restaurant - I can tell by your blonde hair and super-white skin that your heritage must be from Northern Europe - like Sweden or Finland or Norway or Denmark or something!"In fact, Marci's parents did emigrate to the US from Sweden.Marci wants to know if she has a valid legal claim against Mama Mia's?

a.Yes, Marci does have a valid legal claim, as the employer is discriminating against her in violation of the federal Civil Rights Act of 1964.

b.Yes, Marci does have a valid legal claim against the employer, based on the Washington State law:RCW 49.44.100

c. Yes, Marci does have a valid legal claim against the employer, based on the Washington State law:RCW 49.60.180

d.both A and C are true

e.No, Marci does not have a valid legal claim, as the employer does not have enough employees to be covered by either the federal Civil Rights Act of 1964 or the Washington State anti-discrimination laws.

28.Same facts as for Question 27.However in this case, the prospective employer only has 6 full-time employees.You may want to look at the definition of employer under this Washington law: RCW 49.60.040

a.Yes, Marci does have a valid legal claim, as the employer is discriminating against her in violation of the federal Civil Rights Act of 1964.

b.Yes, Marci does have a valid legal claim against the employer, based on the Washington State law:RCW 49.44.100

c.Yes, Marci does have a valid legal claim against the employer, based on the Washington State law:RCW 49.60.180

d.both A and C are true

e.No, Marci does not have a valid legal claim, as the employer does not have enough employees to be covered by either the federal Civil Rights Act of 1964 or the Washington State anti-discrimination laws.

29. Melvin borrows $10,000 from his best friend Martin, so that Melvin can buy a convertible Mustang (1965) that he has always wanted.Martin is happy to help Melvin, but he also wants to be smart about lending money, so he asks Melvin to give Martin collateral in the form of a security interest in the car.What documents should Martin use to protect himself with?

a.a Promissory Note that mentions the car should be sufficient for this.

b.a Promissory Note, and a UCC Financing Statement filed with the state Secretary of State's office in Olympia, Washington

c.a Promissory Note, and a Mortgage on the car, recorded with the county recorder.

30.Zaya is buying a small apartment house, with four units.He lives in one unit, and rents out the other three units.The rent he receives from the three rental units pays the entire monthly mortgage payment on the building, property taxes, insurance, and utilities, so Zaya gets to live there essentially for free!One of his units became available on March 1, 2020, so he advertised for a new renter.Bo has offered to rent the unit for just over one year (from March 1, 2020, until May 31, 2021), for $1,000 per month.

A.This agreement must be in writing to be enforceable in court.

B.This agreement can be oral, and still be enforceable in court.

31. True or FalseIn Washington state, in order to sue someone for payment of a real estate sales commission, the plaintiff must be licensed as a real estate broker. (You may want to read some of the following RCWs:18.85.301; 18.85.311; 18.85.321; 18.85.331; 18.85.411; for assistance in answering this question.)

32.A sole proprietorship is the most common form of doing business in the United States, probably because it is quick, cheap, and easy to set up!True or False

33. A sole proprietorship is also the safest form of business entity for the owner, because of the limited personal liability given to the owner. True or False

34.Bridget needed to buy a car, so she went to a car dealer (Reasonably Honest Bob's Used Cars), and signed a contract to buy a 2005 Honda for $10,000 total price.She had saved up $2,000, which she used as a "down payment" on the car.Then she went to her bank, and asked for a loan for the $8,000 balance on the contract.The Bank has done lots of loans to Bridget over the years, and they only asked Bridget to sign a Promissory Note to promise repayment of their $8,000 loan.This is an example of:

a. A secured loan

b. An unsecured loan

c. A mortgage

35.Second National Bank loaned $400,000 to Thomas, so that Thomas could buy inventory of 1,000 carpets for his Oriental Carpet Store at Northgate Mall.The Bank asked Thomas to sign a Promissory Note for the $400,000, and a UCC Financing Statement, giving the Bank a security interest in all of the inventory of carpets, in case Thomas defaulted.After Thomas had been in business for 6 months, he had only sold one carpet for $5,000.He used the $5,000 to pay one month's rent on his store space in the mall.Thomas made none of the monthly payments to the Bank like he had promised.If the mall sues Thomas for the unpaid rent on the mall store, and the Bank sues Thomas for the unpaid loan, who will have the best legal claim on the remaining inventory of carpets?

a.Whichever creditor completes their lawsuit, and gets a court Judgment against Thomas first will have top priority.

b.The mall will have top priority in claiming the proceeds from sale of the inventory.

c.Second National Bank will have top priority in claiming the proceeds from sale of the inventory.

36.True or False.Most credit cards issued by the banks are "unsecured lending" to the holders of those credit cards.

37.True or FalseA corporation is just another name for an LLC.

38.A regular corporation (also known as a "C-corporation") can have more than one "class" of stocks.For example, it could have one class of common stock with voting rights, and it could also have a class of preferred stock with no voting rights.True or False

39.First, read the definition of "employer" under RCW 49.60.040, which is part of the Washington Law Against Discrimination (the whole chapter is Chapter 49.60 of the Revised Code of Washington).Joshua (who is of Irish heritage) has just started a new small business in Seattle, and only has one employee so far, and it turns out that person also has Irish heritage.For his second employee, he is thinking of just hiring a person who is also of Irish heritage. Joshua only plans to have a total of five employees.It would be legal for him to only interview prospective employees who have Irish heritage.True or False

40.Robert was hired for a full-time teaching position at NSC in Art, starting Spring Quarter 2020.He was highly qualified (having both a Master's degree in Fine Arts, and many years' experience in the art world).Just before the quarter starts, Robert comes to school in a wheelchair - he has been injured in a car accident and will be in the wheelchair for about a year while he is healing and going through "rehabilitation."The Humanities Division Dean is concerned that Robert will not be able to effectively teach the class, maneuver around the Art classroom, etc.Robert explains that he will only need a wheelchair ramp built through part of the Art classroom, and he has gotten bids from two contractors, both for approximately $2,000.The ramp will also cost about $1,000 to remove after Robert has recovered from the accident and no longer in need of the ramp.You may assume that NSC has an annual equipment budget of about $300,000.Under the Americans with Disabilities Act (commonly known as the "ADA") is NSC obligated to provide the ramp for Robert, as a "reasonable accommodation" for Robert?

a.No, $2,000 to build, and $1,000 to remove the ramp, are too high a percentage of the NSC total annual equipment budget, to have to spend to assist just one employee.

b.NSC should only have to pay half of the cost, with Robert assuming the other half of the cost.