Chapter Quiz with options. Need correct answers for it.

1.What is the difference between intentional torts and unintentional (negligence) torts?

Both can result in a lawsuit, but only intentional torts should concern businesspersons.

Intentional torts must have proof of actual damages to succeed, whereas negligence torts do not.

Negligence actions usually result in awards for exemplary damages, whereas such damages are not available for intentional torts.

Other than when strict liability applies, both require fault, but intentional torts require proof of willful action.

Fault is required for both, but a bad motive is required for negligence actions.

2.Which one of the following best describes the duty of care required for a successful negligence action?

The duty of care is established only by statutes passed by a legislature.

We owe a duty to persons we can reasonably predict could be affected by our actions.

We owe a standard of care to the reasonable person.

We owe a standard of care to the reasonable victim.

We owe a standard of care to the reasonable defendant.

3.Various factors affect the assessment of standard of care in a negligence action. Which one of the following is not a correct statement about the factors used to assess the standard of care?

Standards of care are dependent in part on the alertness of the individual defendant.

The expense to achieve an appropriate standard of care in respect of an adult defendant is a relevant consideration.

The skill and understanding of an adult defendant is relevant to assessing the standard of care.

If a public official states that his or her conduct that led to injury was justified, then the court will not look any further into the case.

A minor will have a standard of care that may not be the same as an adult's standard of care.

4.Occasionally the courts are presented with a new situation where the duty of care owed is not clear. When this occurs, the courts

determine if a duty would normally be owed and then consider if there is a social policy reason not to enforce that duty in the new situation.

dismiss the case because the courts will not expand the class of people owed a duty of care.

apply the reasonable person test to determine if the duty of care exists.

consider if there is a political reason the duty of care should not be expanded to this new situation.

apply the reasonabe foreseeability test to determine if the standard of care was too low

5.In which of the following situations will the defence of voluntary assumption of risk apply?

Jerry visits Julie's home and realizes the front steps are missing but jumps up to the door and walks into Julie's home.

After reading the manufacturer's waiver, Ed used a very sharp surgeon's scalpel to cut some paper. The scalpel slipped cutting Ed's hands causing serious injury. Ed sued the manufacturer of the scalpel.

George is intoxicated and knowingly gets into a taxi with another drunken passenger.

Bob did not read the instructions for assembling his gas barbecue. The barbecue later blew up causing Bob serious injuries.

Mary entered the three-legged race but did not read the waiver of liability form she signed. The form had an unusually onerous clause absolving the event organizer of all liability.

6.Which of the following statements is true about the legal principle ofex turpi causa?

Generally speaking, the illegal activity must cause the loss suffered by the plaintiff before the principle can be used to deny liability.

This principle allows the court to assign to the plaintiff more than 50% contributory negligence.

The plaintiff's illegal activity will be a complete defence to the plaintiff's claim.

For negligence to apply, not only must there be damage, but damage must be the direct result of the careless conduct.

Once the plaintiff has established that the defendant owed a duty to be careful to the plaintiff, negligence has been established.

7.What is the negligence of an injured party that contributes to her own loss or injury is known as?

Contributory negligence

Ex turpi causa

Voluntary assumption of risk

Last chance doctrine

Volenti non fit injuria

8.A business

is never liable for harmful substances escaping from its premises.

is almost never liable for injuries caused by defects in the products it sells.

may be vicariously liable for the negligent acts of its employees.

can eliminate all legal risk by purchasing property insurance.

rarely is liable for injuries sustained by visitors to its premises.

9.Strict liability refers to

a wrongful act done to the person or property of another.

injury resulting from the breach of the standard of care.

the liability of an employer to compensate for harm caused by an employee.

liability that is imposed regardless of fault.

the careless causing of an injury to the person or property of another.

10.Beth buys a flashlight from Light Co. Light Co. made the flashlight and shipped it to Packer Inc. to place the batteries and pack it. When Beth opened the package, she noticed there was an odd bulge at the bottom of the flashlight but turned it on anyway. The batteries exploded, injuring Beth. Who is potentially liable for negligence?

No one. Because Beth negligently failed to inspect the flashlight, she cannot sue anyone for negligence.

Light Co. and Packer Inc. only because their combined actions created the harm.

Light Co. only because it made the flashlight and sold it under its name

Packer Inc. only because it placed the battery and packed the flashlight

All three parties. Both Light Co. and Packer Inc. may be held liable for any negligence committed, and Beth may be contributorily negligent for turning on the flashlight after she noticed the odd bulge.

11.Which of the following is not an indicator of the existence of a fiduciary duty?

A professional relationship involving significant trust between the parties

A person relying on the advice provided by another person

A person being particularly vulnerable to or being at the mercy of another person holding discretion and power

The ability of a person to unilaterally exercise power or discretion to affect another person with whom she has a relationship

The scope for exercise of some discretion or power by one person over another

12.A business may be held liable in various ways for its own acts, or the acts of its employees, that cause damage to its customers or clients and to the public in general. As a result, which of the following will a business not normally have liability insurance against?

Liability for negligent acts and omissions

Loss of profit due to interruption of business activities

Liability for the dangerous state of its premises

Liability for defective products

Liability for breach of its professional duty of care

13.What is the value of an insured loss?

The minimum stated in the policy

The stated amount of the policy

The amount of the loss, within the limits of the policy

The full extent of the loss

A statutory minimum established outside of the insurance policy

14.Sam and Steve are partners in a profitable lumberyard. If either of them dies, the surviving partner has to pay the estate a half interest in the assets of the business (to buy out the deceased partner's interest). Therefore, Sam and Steve have each taken out life insurance on the other to provide the necessary funds. Steve is involved in a bad car accident and dies. Does the insurer have grounds for refusing to pay the claim?

Yes, because Sam did not practise utmost good faith with the insurer

Yes, because the cause of Steve's death is unrelated to the business

No, because Steve was not the cause of his own death

Yes, because Sam does not have an insurable interest in Steve

No, because Sam has an insurable interest in Steve

15.The Smiths, a family of three (mom, dad, and their 17-year-old daughter, Jess) had three vehicles. Mr. Smith owned all the vehicles. Generally speaking, Mr. Smith drove the pick-up truck, Mrs. Smith drove the four-door sedan, and Jess drove the convertible. All three drive the vehicles every day, to get to work in the case of the parents and to get to school in the case of Jess.

When Mr. Smith applied for auto insurance including optional coverage for collision damage, he declared that Jess was an occasional driver who drove one of the vehicles on the weekends only.

Based on these facts which of the following is correct?

Mr. Smith has no insurable interest in the vehicles because he is not the sole driver.

Regardless if the statement that Jess was an occasional driver was a material misstatement of insurable risk, the insurance company would still be responsible for coverage if an accident were to occur.

Jess has no insurable interest due to being an occasional driver and coverage for an accident may be denied depending on the statutory provisions in force in that province.

All three drivers were disclosed in the policy application so Mr. Smith did all he could to alert the insurer to the risks.

Since the statement that Jess was an occasional driver was a material misstatement of insurable risk, coverage for an accident may be denied depending on the statutory provisions in force in that province.

16.An insurer has a number of obligations to satisfy its duty of good faith. Which one of the following is not one of those obligations?

Duty to defend insured issues

Duty to receive and process claims fairly

Duty to review relevant evidence

Duty to arrange for a lawyer

Duty to defend uninsured issues

17.Insurers may withhold payments or deny coverage when justified. When is an insurer justified in denying coverage?

An insured claims on an automobile policy where the insured lost control of the vehicle on an icy road and crashed into a fence, harming no one.

Muriel has kidney disease, but she did not tell her disability insurer when she applied for insurance.

Jerry drops a Ming vase and claims on his insurance.

Peter and Charles own a painting worth the insured value of $150 000. The painting is destroyed in a fire. Peter makes a claim.

Grandpa Adams died from an unknown heart condition. His widow claims on the life insurance policy.

18.Tom bought a bike for $500. He then insured his bike. Two years later, his bike is stolen from his yard. Tom notified his insurance company immediately and filed a police report. The insurance company processed the claim. It will give Tom

a cheque for the market value or replacement value of his bike, depending on the terms of the policy.

a bike of the same make and model.

a cheque sufficient to get a new bike.

$500.

a $500 voucher to an approved local bike shop.

19.Artie Dodger is always looking for an opportunity to make a fast buck. He decided to park his car near a four-way stop. He waited for another driver to fail to come to a complete stop at the stop sign. When that driver started to advance, Artie lurched his vehicle forward, colliding with the other vehicle. Artie then leaped out of the car clasping his neck howling in agony and yelling, "Whiplash!" Based on these facts, what is Artie's insurance company's best defence to Artie's claim?

Artie's contributory negligence

There is not enough information to answer the question.

Artie's forfeiture of the policy

Artie's voluntary assumption of risk

The other driver's illegal act

20.In which of the following situations would causation be found?

The defendant was juggling knives nearby when a third party's dog bit the plaintiff.

The defendant set fire to the plaintiff's house.

The defendant robbed a bank. The plaintiff slipped on a puddle of water while leaving the bank after the robbery.

The defendant's car had a burnt-out tail light when the parties collided head on.

The plaintiff was falling down a cliff and the defendant did nothing.