IHI 101.doc

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Question 1
Driving a car negligently, Adam crashes into a phone pole. The pole falls, smashing through the roof of a house, killing Beth. But for Adam’s negligence, Beth would not have died. Regarding the death, the crash is the
Answer cause in fact.
intervening cause.
unforeseeable cause.
superseding cause.
Question 2
Tomas is a business student with a very good business idea for academia. Tomas, with the help of his school’s entrepreneurship center, then develops a detailed business plan for an academic online course registration system. The faculty at the entrepreneurship center thinks that Tomas’ concept and plan have economic potential and thus are quite marketable. Tomas places on his business plan a Confidentiality statement, and also when he “shops” his plan to potential investors and school administrators he asks them to sign a Non-Disclosure Agreement. Based on the aforementioned facts, which statement is likely TRUE?
Answer a. Tomas has protected his business plan by means of federal patent law.
b. Tomas has protected his business plan by means of federal copyright law.
c. Tomas has failed to protect his business plan by trade secret law since a plan, concept, or idea is too “soft” information, as opposed to a “hard” formula or device, for legal trade secret protection.
d. Tomas has protected his business plan by means of state trade secret law.
Question 3
Big Oil Company wants to adopt an English-only policy for its employees working on its oil rigs. The policy applies only when the employees are actually working on the rig, and not while they are on break or otherwise on their own personal time. This policy is:
Answer Legal if the company can demonstrate a legitimate business reason for the policy, such as safety concerns.
Legal if the employer gives it employees a reasonable amount of time to adopt and to conform to the new policy.
Legal if the employer teaches any of its non-English speaking employees to speak English.
All of the above.
Question 4
The directors of Global Investment Company made a “bad” business decision in 2006, by relying on the advice of financial experts and lawyers and accountants, who all thought the real estate market would continue to rise for years and years; and thus the directors invested heavily in mortgage backed securities instead of conservative gold and gold stocks and Treasury bonds. Of course, when the recession came, Global Investment Company lost a great deal of money for its shareholder investors. The shareholders then sued the directors for negligence. The directors are best protected legally by:
Answer The comparative negligence doctrine because the shareholders likely were sophisticated investors who should have known that “what goes up, must come down.”
The assumption of the risk doctrine since everyone knows that the stock market is a risky venture.
The Business Judgment Rule even though the decision turned out to be a “bad” business one.
The doctrine of strict liability for ultra-hazardous activities since it was common knowledge at the time that people were being granted mortgages with no down-payment and no verifiable evidence of income, assets, or employment.
Question 5
Ken, a teacher, sells Larry a parcel of land, claiming that it is “perfect” for commercial development. Larry later learns that it is not zoned for commercial uses. Larry may rescind the contract
Answer only if Ken knew about the zoning law.
only if Larry did not know about the zoning law.
only if the zoning law was not common knowledge.
under no circumstances.
Question 6
Jughead Construction Company puts in a bid to build the new town library. Its bid is $1 million. The other bids range from $2 to $4 million, and the town’s architect estimated to town officials that the library would cost about $3 million. The town accepts Jughead’s bid offer. Jughead’s best defense to any lawsuit for breach of contract under these circumstances would be:
Answer Unilateral mistake
Fraud by the town for keeping the architect’s estimate secret.
Bilateral mistake.
Unilateral palpable mistake.
Question 7
Adam persuades Beth to contract for his company’s services by telling her that his employees are the “best and the brightest.” Adam’s statement is
Answer duress.
fraud.
puffery or sales talk.
undue influence.
Question 8
Lee, a salesperson for Midsize Corporation, causes a car accident while on business. Lee and Midsize are liable to
Answer all those who were injured.
only those who were uninsured.
only those whose injuries could have been reasonably foreseen.
only those with whom Lee was doing business.
Question 9
Standard Business Company agrees to hire Tim as a sales representative for six months. Their contract is oral. This contract is enforceable by
Answer neither Standard nor Tim.
Standard only.
Standard or Tim.
Tim only.
Question 10
Local Delivery Company and Regional Trucking, Inc., attempt to enter into a contract in electronic form. Under the Electronic Signatures in Global and National Commerce Act (E­SIGN Act), because this contract is in electronic form, it
Answer may be denied legal effect.
may not be denied legal effect.
will be limited to certain terms.
will not be enforced.
Question 11
Francis owns a small motel in Sugarloaf Key. She notices by means of public advertising that her competitors in Big Pine Key and Ramrod Key have extended by two weeks their “winter season” and thus their winter season higher rates. Francis also notices the “no vacancy” signs at her competitors’ motels. So, Francis decides to extend the winter season at her motel too. Francis has engaged:
Answer a. Illegal horizontal price-fixing by means of an express agreement.
b. Illegal horizontal price-fixing by means of an implied agreement
c. Legal action by means of the doctrine of Conscious Parallelism
d. Legal action since anti-trust law does not apply to small motels, only large ones and hotels.
Question 12
Carol files a suit against Don. Before going to trial, the parties meet with their attorneys to represent them, to try to resolve the dispute without involving a third party. This is
Answer arbitration.
litigation.
mediation.
negotiation.
Question 13
Jesse, who was injured when a youngster at the home she was visiting got hold of a gun that the homeowner kept for protection, and, the youngster, thinking it was a toy, shot her. She is suing the manufacturer of the gun contending it is a defective product. Her strongest legal argument would be:
Answer The Second Amendment to the Constitution provides for the freedom to bear arms only when related to the establishment of a “well-regulated militia.”
The gun did not have some of the latest experimental “smart gun” technology such as palm print coding.
The gun did not have a warning that it could go off when a youngster got hold of it.
The gun did not have a gun lock.
Question 14
Ken is a shareholder of Local Delivery, Inc. A court might “pierce the corporate veil” and hold him personally liable for Local’s debts
Answer if Ken’s personal interests are commingled with Local’s interests to the extent that Local has no sepa¬rate identity.
if Local calls too many shareholders’ meetings.
if Local is overcapitalized.
under no circumstances.
Question 15
Carol is a salesperson who works for Delta Products, Inc. In determining whether Carol is Delta’s employee or an independent contractor, the most important factor is
Answer the degree of control that Delta exercises over Carol.
the distinction between Delta’s business and Carol’s occupation.
the length of the working relationship between Delta and Carol.
the method of payment.
Question 16
The Board of Directors of Sun Energy Corporation made a major policy decision for the company to develop cylindrical solar panels, which are more efficient then flat panels. However, Chinese manufacturers, with the strong support of the Chinese government, enter the solar panel market, thereby causing the price of all solar panels to drop significantly, thus causing Sun Energy to lose a great deal of money. The shareholders of Sun Energy are very angry at the Board of Directors for making this “bad” business decision. The shareholders likely:
Answer a. Can successfully sue the Board of Directors because they made a poor business decision which cost the company money.
b. Cannot successfully sue the Board of Directors for the decision due to the Business Judgment Rule.
c. Can successfully sue the Board of Directors because the decision was an unethical one.
d. Cannot successfully sue the Board of Directors because the board members are protected by the Corporate Veil theory from any personal liability.
Question 17
At one point in time, the company Gator-Aide commanded 83% of the sports beverage market. This market share was primarily due to the fact that a University of Florida professor had invented the product which became very popular and thus the company became very successful. However, there were two other competitors in the market – Coke and Pepsi, which approximately shared the rests of the market. Pursuant to Section 2 of the Sherman Act, the best conclusion regarding anti-trust liability for Gator-Aide would be:
Answer The company would be deemed guilty of monopolization of commerce since it possessed a very high share of the market.
The company would not be deemed guilty of monopolization of commerce.
The company would not be liable since the courts would say that the market was too narrowly defined and should include other sports drinks, such as water, soda, and beer (but only light beer).
The company committed a horizontal restraint of trade by “freezing out” its main competitors.
Question 18
Jim and Gail contract for the sale of 500 computers. The agreement states, “The obligations of the parties are conditional on Gail obtaining financing from First Bank by August 1.” This clause likely is
Answer a condition precedent.
a condition subsequent.
a concurrent condition.
not a condition.
Question 19
To acquire the ownership of a strip of waterfront property by adverse possession, Glen must occupy the property exclusively, continuously, and peaceably for a specified period of time
Answer in an open and adverse manner.
until the owner files suit.
without the owner’s knowledge.
with the state’s permission.
Question 20
Rajiv, the owner of a very nice and successful Indian restaurant, House of India, in western Broward County, is going to retire. He plans to sell the business, together with good will and recipes, and with the current staff remaining, to the Patel family, who are new to the restaurant business. Although Rajiv says he is going back to India, the Patel family members are not so sure that Rajiv will return to Florida and open up a competing restaurant business in the near vicinity, thereby drawing back his old customers to the detriment of the Patel family. Accordingly, as part of the contract for the sale of the business, a covenant-not-to-compete clause is included wherein Rajiv promises not to compete directly or indirectly in the Indian restaurant business for two years and in a radius of 10 miles of the House of India. The likely legal effect of this covenant is:
Answer a. The covenant is illegal and void since it is a restraint of trade in violation of the Sherman Anti-trust Act.
b. The covenant is illegal and void since it is against public policy, which favors competition.
c. The covenant is legal since it appears reasonable in time and place.
d. The covenant is illegal since it seems unreasonable in time and place.