Mid-Term Examination – October 20, 2014
BUSI 2601A – Business Law
MID_TERM EXAMINATION
Instructions: This examination is worth 45% of your final grade in this course. You should
attempt to answer all the questions. PART A consists of 20 multiple choice questions. Each
multiple choice question is worth 1 mark, or 1% of your final grade. These questions are to
be answered on the SCANTRON worksheet PART B consists of short answer questions that
must be answered in the answer booklet. The value of each question is as marked. You have
3 hours to complete the examination.
PART A MULTIPLE CHOICE. ANSWER ON THE SCRANTON SHEET
Choose the one answer that best responds to a question or best completes the sentence.
QUESTION 1
The rule of law:
(a)
(b)
(c)
(d)
(e)
describes the fact that our legal system is rules based
describes a rule of statutory construction
describes the notion that the law is supreme to any individual or office holder
describes an approach to interpreting a contract
describes the rules or processes that govern civil litigation
QUESTION 2
Former Prime Minister Pierre Elliot Trudeau’s famous statement that “there is no place for
the state in the bedrooms of the nation” is best reflected by the philosophy of:
(a)
(b)
(c)
(d)
(e)
Thomas Aquinas
John Stuart Mill
Karl Marx
Thomas Hobbes
Kanye West
QUESTION 3
Which of the following statements is NOT TRUE regarding the Canadian legal system?
(a) It is characterized by secular values based on a social contract and individual rights
limited by “harm to others” criteria
(b) It is a constitutional monarchy
(c) It is based on a federal system
(d) It is characterized by the rule of law
(e) It is dominated by alternative dispute resolution as opposed to litigation
QUESTION 4
The purpose of an award of damages for breach of contract is to
(a) restore the offended party to the financial state it would have been in had the contract
been honoured
(b) punish the party who breached the contract
(c) force the party who breached the contract to perform it
(d) ensure that the offended party is paid for its financial losses and emotional suffering
(e) reward the party who breached the contract
QUESTION 5
A contract will be set aside by the courts if
(a) the contract gives one party a profit that is higher than the norm for a particular
industry
(b) the contract is not in writing and has been agreed to orally only
(c) the contract is contrary to public policy
(d) the contract requires alternative dispute resolution
(e) the contract has been breached
QUESTION 6
Which of the following statements is FALSE?
(a)
(b)
(c)
(d)
(e)
A contract can be formed if acceptance of an offer is both unconditional and clear
A contract can be formed if an invitation to treat is accepted
A contract can be formed if a counteroffer is accepted
A contract can formed by both individuals and corporations
A contract generally cannot be formed without consideration
QUESTION 7
Which of the following is an example of ADR or alternative dispute resolution?
(a)
(b)
(c)
(d)
(e)
Arbitration
Litigation
A Motion
An Application
A Judgment Debtor Examination
QUESTION 8
Which of the following can be an intentional tort?
(a) Recission
(b)
(c)
(d)
(e)
Restitution
Misrepresentation
Negligence
Quantum meruit
QUESTION 9
A Power of Attorney is
(a)
(b)
(c)
(d)
(e)
A form of agency
A document that empowers or retains legal counsel to represent a business in court
A power given to a union in a collective agreement
A form of employment
A tax planning instrument
QUESTION 10
Which of the following is most likely an example of negligence?
(a) The provision of accounting advice containing an error of judgment upon which a
client relies
(b) The provision of legal advice based on opinion rather than fact that is followed by a
client
(c) The unsuccessful provision of surgical services resulting in the death of the mother of
3 young children
(d) The provision of engineering services falling below a reasonable standard of care
resulting in the collapse of a bridge
(e) The refusal of a store to give a refund to a customer dissatisfied with her product
QUESTION 11
The Charter of Rights and Freedoms
(a)
(b)
(c)
(d)
(e)
is an element of Canada’s constitution
is a federal statute that protects human rights
is a provincial statute that protects human rights
is a regulation under Canada’s Bill of Rights
is the most important part of Canada’s Criminal Code
QUESTION 12
The federal government has jurisdiction over which one of the following areas of law?
(a)
(b)
(c)
(d)
Property and civil rights
Administration of Justice
Local matters
Criminal Law
(e) Hospitals
QUESTION 13
When a plaintiff sues a defendant in court for breach of contract, the plaintiff must prove its
case
(a)
(b)
(c)
(d)
(e)
Beyond all reasonable doubt
Beyond all expectations
On a balance of probabilities
On a balance of convenience
Beyond all reasonable question
QUESTION 14
An agent’s apparent authority is
(a) what a reasonable third party dealing with the agent would reasonably believe to be
the agent’s authority
(b) always the same as the agent’s actual authority
(c) never the same as the agent’s actual authority unless a third party has knowledge to
the contrary
(d) never in writing
(e) his or her authority to act as the parent of a minor
QUESTION 15
A partnership is essentially
(a)
(b)
(c)
(d)
(e)
the pursuit of a common interests by two or more legal persons
the pursuit of social needs by two or more legal persons
the pursuit of socially desirable results by two or more legal persons
the pursuit of scarce resources by two or more legal persons
the pursuit of profit by two or more legal persons
QUESTION 16
Which of the following is NOT a feature of a corporation?
(a)
(b)
(c)
(d)
(e)
Profits are paid to shareholders by dividends after corporate taxes are paid
The shareholders benefit from limited liability
The shareholders are vicariously liable for the negligence of corporate employees
A corporation can get access to capital by issuing more shares and selling them
Its Board of Directors makes strategic decisions and the CEO makes operational ones
QUESTION 17
A Not for Profit Corporation
(a)
(b)
(c)
(d)
(e)
has members rather than shareholders
is exactly like any other corporation that seeks profits
does not offer limited liability to its members
must issue a prospectus to go public
is also known as a franchise
QUESTION 18
Which statement is FALSE with respect to product liability?
(a) Product liability generally iinvolves negligent design or manufacture or sale of
products
(b) Product liability rarely results in class action litigation
(c) Product liability can result from a failure to recall defective products in a timely
manner
(d) Product liability is often grounded in both contract and tort
QUESTION 19
Which of the following is a possible remedy for breach of contract in Canada?
(a)
(b)
(c)
(d)
(e)
Imprisonment
Specific Performance
Bail
Contra proferentum
Writ of Mandamus
QUESTION 2O
The tort of nuisance
(a)
(b)
(c)
(d)
(e)
addresses conflicts between neighbours stemming from land use
addresses conflicts between tenants as a result of noise at night
addresses stalking
addresses cyber bullying
addresses harassment at work and in school
PART B –SHORT ANSWERS
Answer these questions in your answer booklet. The mark allocation for each question
reflects how many points you are expected to raise in your answer. For example, in question
1, each point is worth half a mark.
QUESTION 1
Provide two reasons why alternative dispute resolution is often a good idea for an
international contract (1 MARK)
QUESTION 2
What is a mortgage in simple terms (1 MARK)?
QUESTION 3
What are 2 key elements of the Corruption of Foreign Public Officials Act (1 MARK)?
QUESTION 4
What are the three key elements that must be proven in a legal claim based on negligence (1.5
MARKS)?
QUESTION 5
Briefly describe 6 situations where a contract may not be enforced (3 MARKS).
QUESTION 6
Name and briefly describe six of the requirements generally needed to form a contract (3
MARKS).
QUESTION 7
Name and briefly describe five of the rules of contract construction (2.5 MARKS)
QUESTION 8
Name and briefly describe 6 intentional torts (3 MARKS)
QUESTION 9
Name and briefly describe the 5 key stages of the litigation process (2.5 MARKS)
QUESTION 10
Name 4 advantages of secured debt over unsecured debt from the creditor’s perspective (2
MARKS)
QUESTION 11
What are 3 characteristics of a sole proprietorship? (1.5 MARKS)
QUESTION 12
Briefly describe two types of business arrangements such as franchises etc. (1 MARK)
QUESTION 13
What is a limited partnership and how does it differ from a regular partnership (2 MARKS)