Business Law
Test Questions
Course Introduction
Business Law provides an introduction to the legal principles and regulations that affect businesses and commercial transactions. The course explores topics such as contract law, agency, sales, negotiable instruments, business organizations, employment law, intellectual property, and government regulation. Emphasis is placed on understanding the legal environment of business, recognizing legal issues in business situations, and applying legal reasoning to real-world scenarios. Students gain practical knowledge of how laws impact business operations and decision-making, equipping them with the skills to navigate legal challenges in a business context.
Recommended Textbook
Business Law in Canada 11th Canadian Edition by Richard
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16 Chapters
2535 Verified Questions
2535 Flashcards
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Page 2
A. Yates
Chapter 1: Managing Your Legal Affairs
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127 Verified Questions
127 Flashcards
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Sample Questions
Q1) Contingency fee agreements
A) are typically used for real estate purchases, the drafting of wills, and incorporations.
B) are not subject to any restrictions.
C) are synonymous with retainer agreements.
D) may result in a lawyer not receiving any legal fees for the work done on a file.
E) must be prepared for all lawyer-client relationships.
Answer: D
Q2) Raman is a sophisticated client. This means that she
A) understands how to manage a lawyer-client relationship.
B) has a law degree.
C) is a small business owner.
D) manages her legal affairs without assistance from a lawyer.
E) will probably never find herself in a situation necessitating legal advice.
Answer: A
Q3) What may occur if you collect money as the result of a settlement or judgment obtained through assistance from legal aid?
Answer: You will probably have to repay some or all of the benefits received from legal aid.
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Chapter 2: Introduction to the Legal System
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159 Verified Questions
159 Flashcards
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Sample Questions
Q1) Everyone in Canada has the right to freedom of conscience and religion.
A)True
B)False
Answer: True
Q2) Which of the following is an example of substantive law?
A) The rule that a tort action must be commenced within 2 years of the action complained of
B) The rule that establishes the type of document by which an action is commenced
C) The rule that hearsay evidence is not permitted in a trial
D) The rule that a victim of fraud can sue
E) A rule that any action under $50,000 may be brought in the small claims court
Answer: D
Q3) Subordinate legislation includes regulations and municipal bylaws.
A)True
B)False
Answer: True
Q4) The body of rules developed by the Court of Common Pleas, Court of King's Bench, and Exchequer Court became known as ________.
Answer: the common law
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Chapter 3: The Resolution of Disputes: the Courts and Alternatives to Litigation
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221 Verified Questions
221 Flashcards
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Sample Questions
Q1) A jury is not available in civil disputes.
A)True
B)False
Answer: False
Q2) In the Ontario Court of Appeal decision in Joseph v. Paramount Canada's Wonderland, the Court held that
A) if a claim was filed after the expiration of the limitation period, and the special circumstances doctrine no longer applied, the action would be prohibited.
B) there is no limitation period to civil cases.
C) when a person sues for negligence, there must also be a breach of contract or the action will fail.
D) limitation periods do not apply to negligence claims.
E) limitation periods do not apply to claims for breach of contract.
Answer: A
Q3) Distinguish between the executive and legislative branches of government.
Answer: Federally, the legislative branch is parliament, including the House of Commons and the Senate. Provincially, the legislative branch is the legislative assembly. For both, the executive branch consists of the public service and the cabinet.
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Chapter 4: Intentional Torts and Torts Impacting Business
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Sample Questions
Q1) Invasion of a person's property may take the form of all of the following except
A) unauthorized access to information.
B) misuse of an image or name.
C) detinue.
D) a physical intrusion.
E) surveillance.
Q2) The federal legislation that regulates the collection and use of personal information in the private sector is known as the
A) Personal Information Protection and Electronic Documents Act.
B) Privacy Act.
C) Private Sector Privacy Act.
D) Code of Personal Information.
E) Act for the Protection of Private Information.
Q3) Explain how your right to defend yourself is limited.
Q4) If Bree lends Gabby a blender, but then Gabby refuses to return it, Bree could bring an action in detinue for compensation.
A)True
B)False
Q5) Name two torts that deal with wrongful interference with goods.
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Chapter 5: Negligence, Professional Liability, and Insurance
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155 Verified Questions
155 Flashcards
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Sample Questions
Q1) The standard of care that is required of a professional in a negligence action is that she acts to the best of her ability.
A)True
B)False
Q2) What is the last clear chance doctrine?
Q3) What is the reasonable person test used for?
Q4) What is the role of self-governing professional bodies?
Q5) What test is used to determine the standard of care?
Q6) A recent innovation in the insurance industry is where several types of liability are bundled together, allowing the insured higher limits of coverage for a more economical premium.
A)True
B)False
Q7) Strict liability means that liability can be established even when there is no fault. A)True
B)False
Q8) Children are not held liable for their torts.
A)True B)False
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Chapter 6: The Elements of a Contract: Consensus and Consideration
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184 Verified Questions
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Sample Questions
Q1) Which of the following shows accurate use of the doctrine of promissory (equitable) estoppel?
A) Val told Jim that she would give him her printer. If she doesn't, Jim could use the doctrine to force her to do so.
B) George rented a video and watched it with Elaine. She thought the movie was great and said she'd pay half the rental price. George could use the doctrine to force her to pay as she promised.
C) This doctrine can be used by a plaintiff to enforce a written promise that has been signed and sealed (i.e., a seal has been affixed next to the signature of the promisor).
D) Bruce, a defendant, can use this doctrine as a defence against a plaintiff insisting on his full legal right when he had promised to forgive Bruce some of Bruce's legal obligation and Bruce relied on that promise.
E) Lam contracted to supply Jones with steel. Before the steel was delivered, Lam's supplier increased the price. Lam could use the doctrine to force Jones to pay more to Lam.
Q2) Discuss the "freedom of contract," explaining what the implications and limitations are in the context of contract law.
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Page 8
Chapter 7: The Elements of a Contract: Capacity, Legality, and Intention
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157 Verified Questions
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Sample Questions
Q1) Which one of the following is an example of a contract that is binding on an infant in jurisdictions other than British Columbia?
A) A contract to purchase a new stereo
B) A contract for a camera
C) A contract for baseball tickets
D) A contract for rent
E) A contract for professional hairstyling
Q2) When a person is declared mentally incompetent by a court, who is appointed and for what purpose?
Q3) Indicate 4 categories of persons that have their capacity to enter into contracts limited to some extent.
Q4) Discuss agreements that restrict competition or that are a restraint of trade and how they are treated in contract law.
Q5) Married women are no longer considered incapacitated in contract law.
A)True B)False
Q6) Contracts involving domestic relationships are presumed to be binding. A)True B)False
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Chapter 8: Factors Affecting the Contractual Relationship
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Sample Questions
Q1) When two parties are involved in a mutual mistake (misunderstanding) as to the meaning of a term of the contract, which of the following is usually applied by the court to settle the matter?
A) The court will find that there is no contract because there is no meeting of the minds.
B) Non est factum
C) Caveat emptor
D) The reasonable person test
E) The equitable remedy of rectification
Q2) In Rochdale Credit Union v. Barney, a lawyer persuaded his client to guarantee a loan. The relationship of solicitor/client leads to a presumption of A) duress.
B) mental incapacity.
C) lack of intention.
D) unconscionability.
E) undue influence.
Q3) An assignee can be in no better position than was the assignor.
A)True
B)False
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10
Chapter 9: The End of the Contractual Relationship
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Sample Questions
Q1) Explain what is meant by quantum meruit.
Q2) Discuss frustration in contract law and indicate when it is available and how and why it has been modified by statute.
Q3) What is the usual impact of an exemption clause in the event of fundamental breach?
Q4) In the case of an anticipatory breach
A) you have the right to demand the other side to perform, but you will not be required to perform yourself.
B) you have the right to demand performance or to sue for breach.
C) you must wait until the actual breach occurs before you can take any steps.
D) the contract is declared void ab initio.
E) the contract is unenforceable by either party.
Q5) A breach of warranty allows a victim to sue for damages, but they must go through with their obligations under the contract.
A)True
B)False
Q6) Distinguish between a down payment and a deposit.
Q7) What is the result of a breach of a significant term of a contract where there is a minor failure to perform?
Page 11
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Chapter 10: Agency and Partnership
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211 Verified Questions
211 Flashcards
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Sample Questions
Q1) Explain under what circumstances a principal who is not an employer will be held responsible for the wrongful acts of his agent.
Q2) John Agent entered into a contract with Joe Third Party to buy 50 stoves, payment to be made two weeks after John Agent picked up the stoves from Joe Third Party's warehouse. The stoves were picked up, but eight weeks later Joe still had not been paid. Joe found out that John Agent had been authorized to buy 50 stoves for Gord Principal. For some reason, John had not made it clear to Joe that he was acting as an agent, nor had he indicated that he was buying the goods for himself. Under the circumstances, which of the following is true?
A) Third Party can successfully sue only Gord Principal.
B) Third Party can successfully sue only John Agent.
C) Third Party can successfully sue both Principal and Agent.
D) Third Party can elect to recover from either Principal or Agent but not both.
E) Third Party can ratify the contract with Gord.
Q3) Distinguish between the actual and the apparent authority of an agent.
Q4) Distinguish between a partnership and a corporation.
Q5) Jones is a partner in a law firm in a small town and he also does legal work out of his home in the evening to earn extra income for himself. Explain the rights of his partners in this situation.
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Chapter 11: Corporations
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Sample Questions
Q1) Which of the following statements about pre-incorporation contracts is False?
A) Promoters will often purchase property on behalf of a corporation prior to incorporation and then have the corporation ratify after incorporation has taken place.
B) Ratification of pre-incorporation contracts is invalid at common law, since the corporation did not exist at the time the contract was made.
C) Many jurisdictions have made legislative changes permitting later-incorporated corporations to ratify pre-incorporation contracts.
D) If a corporation does not ratify a pre-incorporation contract, or if a pre-incorporation contract is signed in a jurisdiction which does not permit ratification, the promoter remains solely liable for any losses.
E) Promoters cannot be held liable for losses due to the doctrine of corporate myth.
Q2) Explain why a corporation is referred to as a legal fiction.
Q3) Explain the significance of the determination that a corporation is a broadly held corporation as opposed to a closely held corporation.
Q4) Explain the power of a minority shareholder in decision-making situations.
Q5) Explain what is meant by a preferred share.
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Chapter 12: Employment
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161 Verified Questions
161 Flashcards
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Sample Questions
Q1) Which of the following is an unfair labour practice?
A) A union representative has a conversation with an employee about joining the union.
B) An employer threatens to have an employee fired if he joins a union.
C) An employee is required to join a union as a condition of employment.
D) An employer pays higher wages as part of his annual wage increase, as a union is trying to organize his employees.
E) An employer starts another unrelated business that is non-union, as a union tries to organize his employees at the present location.
Q2) What significant differences are there between the rights associated with public sector employees and those associated with private sector unionized employees?
Q3) What is meant by secondary picketing?
Q4) When an employee leaves the job because of constructive dismissal, his only recourse is to complain to the appropriate human rights tribunal.
A)True
B)False
Q5) Give three example of unfair labour practices on the part of the employer.
Q6) To what does the term "check-off provision" refer?
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Page 14
Chapter 13: Intellectual Property
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Sample Questions
Q1) Which of the following is true with regard to trademark infringement and the remedies of the trademark owner?
A) Once a trademark is registered, the owner of the trademark cannot lose the right to use that mark.
B) Before a trademark owner can sue successfully for an infringement, he must prove that the mark used by the defendant actually did confuse members of the public.
C) Before a trademark owner can sue successfully for an infringement, he must prove that the mark used by the defendant was the same as his mark.
D) The owner of a trademark can sue someone who forges his trademark, and can ask the court for an injunction, an accounting of profits, and custody of the offending wares.
E) If a person forges a trademark, that person can be sued by the owner of the trademark for infringement in a civil action, but there cannot be any criminal charges laid against him.
Q2) "In Canada, copyright always resides with the author of the material." Discuss the accuracy of this statement.
Q3) Give three examples of matters covered by copyright legislation.
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Chapter 14: Real and Personal Property and Protection of the Environment
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130 Verified Questions
130 Flashcards
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Sample Questions
Q1) Jurg was hosting a luncheon when his punchbowl broke. He went next door and asked his neighbour, Ethan, if he could borrow his. Ethan reluctantly agreed, commenting that the punchbowl was a family heirloom. This made Jurg a little nervous. On his way back home, he was wondering what his legal responsibility would be in relation to the bowl. Which one of the following statements is true?
A) Because this is a gratuitous bailment for Jurg's benefit, Jurg must be reasonably careful that no harm or damage comes to the punchbowl.
B) Because this is a gratuitous bailment, Jurg has no legal obligation in relation to the punchbowl.
C) Because Jurg borrowed the punchbowl, he must return it in the same condition and is liable for any damage howsoever caused.
D) Because Ethan lent the punchbowl to him reluctantly, the rules of an involuntary bailment apply.
E) Because the punchbowl is valuable, the rules of a bailment for value will be enforced.
Q2) Distinguish between a leasehold estate and a freehold estate.
Q3) What is meant by "relief against forfeiture"?
Q4) Describe the environmental review process in place under federal legislation.
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Chapter 15: Priority of Creditors
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Sample Questions
Q1) A continuing guarantee
A) allows a creditor to advance further funds without affecting the obligation of the guarantor to pay in the event of default.
B) is a primary obligation of a third party to pay a debt along with a debtor.
C) is a written commitment not to pursue a legal claim against another.
D) is an equitable principle assuring that when security is repossessed, there will be a period of time during which the debtor can still make payment.
E) allows a breaching party to pay an amount specified in a contract, rather than facing a lawsuit for damages.
Q2) Explain what happens when the owner of property fails to hold back the appropriate amount when making payments to the general contractor.
Q3) Once the bankrupt has been discharged, explain his status.
Q4) What alternatives are available to the bankruptcy process?
Q5) Explain what is meant by a "chose in action."
Q6) What is the purpose of the Fraudulent Conveyances Act? (The name varies with the province.)
Q7) "Bankruptcy is a convenient way to avoid paying your debts." Discuss the accuracy of this statement.
Page 17
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Chapter 16: Sales and Consumer Protection
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Sample Questions
Q1) Tahmineh was very upset to find herself short of cash after her roommate had moved out without paying her share of the month's expenses. Tahmineh had no choice but to borrow money from QuickMoney Loans. Without getting legal advice, she signed a contract in which she agreed to pay back the money along with interest. The interest clause provided that interest was to be calculated at the rate of 2 percent per month. Tahmineh failed to pay back all of the funds and QuickMoney Loans sued her. What argument might she successfully raise to limit the amount of her obligation?
A) The Interest Act provides that in any contract where interest is payable, interest must be stated as an annual rate.
B) Because the actual interest rate was over 1 percent per month, the interest provision was contrary to the Criminal Code.
C) It is unlawful to charge interest to a person in a vulnerable state.
D) Because Tahmineh did not receive independent legal advice, the loan agreement is void.
E) Because Tahmineh was upset over her roommate moving out, she lacked capacity to agree to the terms of the contract.
Q2) Explain how the money lending business is controlled in your province.
Q3) Explain what is meant by the term "consumer transactions."
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