QUESTION 41 A owns a tract of land which is not his homestead. A borrows money from Bank to be repaid over a term of ten (10) years. To secure the loan, A executes a deed of trust describing the tract of land, naming the Bank as beneficiary. Bank immediately records the deed of trust. One year later, A conveys the property to Buyer in consideration for payment of $10,000. A never tells Buyer about the outstanding loan or deed of trust. Buyer promptly records his deed. Under Texas law, if A fails to pay the note to Bank: 1. A can revoke the conveyance to Buyer because A did not have clear title at the time of the deed to Buyer. 2. Bank can foreclose on the property and divest Buyer of title. 3. Buyer can prevent the Bank from foreclosing on the property because Buyer was not given actual notice of the bank's lien. 4. Bank can sue A but cannot foreclose on the property because A no longer owns it.

QUESTION 42 Corporations that are privately organized for profit but also provide a service upon which the public is dependent are generally referred to as 1. quasi-public corporations. 2. public corporations. 3. private corporations. 4. all of the above

QUESTION 43 Under Texas law, a dismissed employee does not have a cause of action for wrongful termination as a result of which of the following : 1. termination for reporting racial discrimination to a supervisor 2. termination prior to expiration of an employment contract 3. termination for missing work due to make an appointment ordered by a doctor. 4. termination for being born in Iran

QUESTION 44 The process of becoming a Limited Liability Partnership generally requires registering with the appropriate state office, and 1. paying the necessary filing fees. 2. making certain that the firm has a least three partners. 3. eliminating partnership management rights. 4. none of the above.

QUESTION 45 Which of the following is a leasehold estate? 1. tenancy for years 2. periodic tenancy 3. tenancy at will 4. all of the above

QUESTION 46 Tyrone loaned a local partnership $4,000. If the partnership dissolves, it is 1. legally obligated to give Tyrone constructive notice or actual notice of its dissolution. 2. not legally obligated to give Tyrone any notice of its dissolution. 3. legally obligated to give Tyrone constructive notice of the dissolution. 4. legally obligated to give Tyrone actual notice of the dissolution.

QUESTION 47 Boss fires Lazy Lucy because she smokes during her lunch hour away from the job. Boss action in firing Lucy: 1. constitutes intentional infliction of emotional distress 2. will likely be considered good cause for purposes of unemployment benefits 3. violates her civil rights as a female smoker 4. is lawful

QUESTION 48 When foreclosure occurs, the owner/debtors ____________________ is cut off: 1. right of redemption 2. right of respondent superior 3. right of bankruptcy 4. fertility

QUESTION 49 A merger of large publicly-traded corporations generally must be approved by 1. the Federal Trade Commission 2. a three-eighths majority vote of the corporation's shareholders. 3. a two-fourths majority vote of the corporation's shareholders. 4. all of the corporation's shareholders.

QUESTION 50 Article I of the U.S. Constitution 1. establishes the principle of supremacy. 2. determines that a presidential term of office runs for six years. 3. states that Congress consists of the Senate and the House of Representatives. 4. gives judicial power to the Supreme Court and to other courts set up by Congress.

QUESTION 51 Three shareholders submitted three different shareholder proposals to the management of a large corporation. The proposals met length and timing requirements, and each shareholder who submitted a proposal owned 2 percent of the corporation's voting stock. Which proposal, under SEC rules, will be considered invalid by the corporate management? 1. a proposal to amend the bylaws 2. a proposal to amend the corporate charter 3. a proposal to hire a particular employee 4. all of the above

QUESTION 52 Upon the dissolution of a partnership, which of the liabilities of the partnership should be paid last? 1. liabilities to creditors other than partners 2. liabilities to partners for loans or advances made to the partnership 3. liabilities to partners for their share of profits 4. liabilities to partners as repayment for their capital contributions

QUESTION 53 In bankruptcy, a legal order that stops the debtor's creditors from making further moves to collect the money that the debtor owes them is called a(n) 1. liquidation. 2. waiver. 3. automatic stay. 4. discharge.

QUESTION 54 Wendy's written will is witnessed by one person in a state that requires the presence of two witnesses. Wendy's will 1. is construed as a deed 2. is invalid. 3. can become valid if a properly signed notary block is added at a later date. 4. all of the above

QUESTION 55 The Cobble Corporation purchases all the property of Dansen, Inc. Such a transaction is known as 1. an asset acquisition. 2. a merger. 3. a consolidation. 4. a stock acquisition.

QUESTION 56 The system that allows shareholders to multiply the number of their voting shares by the number of directors to be elected is known as 1. cumulative voting. 2. proxy voting. 3. shareholder democracy. 4. a voting agreement.

QUESTION 57 The rule-of-reason approach is used by the courts to 1. determine whether an interlocking directorate exists in two corporations. 2. judge the legality of an alleged antitrust practice that is not considered a per se violation. 3. determine whether an alleged antitrust practice is a per se violation. 4. all of the above

QUESTION 58 A shareholder's preemptive right allows the shareholder to 1. share in dividends after the dividends have been declared by the board of directors. 2. purchase a proportionate share of every new offering of stock by the corporation. 3. inspect the records of the corporation at any time. 4. sell or transfer her shares of stock.

QUESTION 59 The person to whom property is transferred by deed is called the 1. grantee. 2. riparian owner. 3. devisee. 4. grantor.

QUESTION 60 Dividends on cumulative preferred stock that are not paid in one year 1. are distributed among holders of common stock. 2. will be paid in later years if any dividends at all are paid by the corporation. 3. are lost forever. 4. none of the above