3- Harry enters an agreement to buy a "chip and dip" plate from Pete for $100, payment in advance. Harry sends Pete a (good) check, but Pete refuses to send Harry the plate. Harry wants to sue Pete for breach of contract. Can he?

Select one:

a.

Yes, a condition precedent triggered the duty to perform

b.

Yes, a condition concurrent triggered the duty to perform

c.

Yes, a condition subsequent affected performance

4- Harry has hired Joan to be his TV assistant, but shortly before Joan is due to start, she takes another, better-paying job at a rival advertising firm. Harry contracted with Joan for two years at a salary of $5,000/month, but now has to hire Peggy instead, for two years at a salary of $7,000/month. Harry sues Joan for breach of contract. What result?

Select one:

a.

No recovery; Harry found another employee

b.

Harry wins compensatory damages of $24,000

c.

Harry wins compensatory damages of $48,000

d.

Harry wins compensatory damages of $72,000

5- Betty needs certain herbs for her herbal tea, and so on Monday she makes a written offer to Jiang Qing: "I will buy Magic Herb #2, price, quantity and delivery date to be determined." Have Betty and Jiang made an agreement, sufficient to support the formation of a contract?

Select one:

a.

No: common law applies, no definite terms

b.

No: UCC applies, no definite price term

c.

No: UCC applies, no definite quantity term

d.

Yes

6- Bert is catering an upcoming firm party and contracts with Wine Cheaper, a wine merchant, to buy some bottles of fine Champagne. Wine Cheaper sets aside the Champagne, notifies Bert that it is ready, but an unexpected earthquake destroys it before Bert can pick it up. As between Bert and Wine Cheaper, who bears the risk of loss?

Select one:

a.

Bert: seller delivered

b.

Bert: seller tendered delivery

c.

Wine Cheaper: no delivery

d.

Wine Cheaper: no tender of delivery

7- Ken is a car salesman at Big Al's Automotive Emporium. One day he sells a Cadillac to Peggy for $10,000. She has told Ken that she really needs the car to accelerate fast, but Ken says nothing about the acceleration. One month later, Peggy is driving by the golf course near her home when she sees Duck lining up his shot. She tries to accelerate, but the car stalls and Duck's ball smashes her windshield. Peggy sues Big Al for breach of express warranty (EW), implied warranty of merchantability (IW/M) and implied warranty of fitness for particular purpose (IW/F). Who wins?

Select one:

a.

Peggy: breach of IW/M

b.

Peggy: breach of IW/M and IW/F

c.

Peggy: breach of EW and IW/F

d.

Ken: no actionable warranties

8- Ken is again working as a car salesman for Big Al, and is trying to sell Pete a used BMW. Big Al has told Ken that the car was involved in a major accident and was later repaired. However, Ken is eager to make the sale and deliberately tells Pete that the car had never been in any accidents. Pete buys the car, learns about the prior accident, and sues both Ken and Big Al for intentional misrepresentation. Does Pete win?

Select one:

a.

Yes, against Ken

b.

Yes, against Big Al

c.

Yes, against both Ken and Big Al

d.

No

9- Harry, George, Bert and Roger have formed a general partnership. Harry has contributed $1,000 and does much of the physical work. George has contributed $1,000 and does much of the planning. Bert has contributed $2,000 but does not do much of anything. Roger has promised to contribute $2,000, but has not done so, and tells the others he should not have to pay since he is so valuable to the business. George has entered into a contract that proves to be a bad deal for the partnership and results in a loss of $6,000. What is the potential liability of Harry for this loss?

Select one:

a.

0 (George bears full liability)

b.

$1,000 (partnership stake)

c.

$1,500 (equal division among partners)

d.

$6,000 (joint liability)

10- Betty has formed Bicycle Fish, Inc., a California C Corporation. Betty has issued 10,000 shares of common stock. She holds 6,000 shares, and she has sold 2,000 shares each to Bert and Roger. Betty, Bert and Roger are the directors, and Betty (CEO/CFO) and Bert (Secretary) are the officers. Directors receive no compensation, but officers are paid a reasonable salary. It's been a good year for the Fish, which made a profit of $200,000, and the board declares a dividend of $5/share, the remaining profit to be retained by the corporation. What are the tax consequences for Betty personally?

Select one:

a.

No tax liability

b.

Tax liability on salary

c.

Tax liability on salary and dividends

d.

Tax liability on salary, dividends and retained earnings

11- Under the UCC, where do you see differences to the common law model of contracts in good offer?

Select one:

a.

Objective intent

b.

Definite terms

c.

Communication

d.

All of the other answers

12- Under the UCC, for the mirror image rule NOT to apply, and for a different acceptance to be effective, who needs to be a merchant?

Select one:

a.

Offeror

b.

Offeree

c.

Both offeror and offeree

d.

Neither offeror nor offeree