Business Law: Text & Cases, Chapter 2

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1

The Maine state legislature passes a law to regulate local delivery services. The final authority regarding the constitutionality of this law is​

a. ​the judicial system.

b. ​the president of the United States.

c. ​the governor of Maine.

d. ​the U.S. Congress.

a. ​the judicial system.

2

As a judge in a federal court, Elena can decide, among other things, whether the laws or actions of the executive and legislative branches are constitutional. The process for making this determination is known as​

a. ​judicial review.

b. ​jurisdiction.

c. ​jurisprudence.

d. ​justifiability.

a. ​judicial review.

3

Hope wants to file a suit against Gerry. For a court to hear the case,​

a. ​Gerry must agree.

b. ​the court must have jurisdiction.

c. ​the parties must have no minimum contacts with each other.

d. ​the parties must own property.

b. ​the court must have jurisdiction.

4

Hua, a resident of Illinois, owns a warehouse in Indiana. A dispute arises over the ownership of the warehouse with Jac, a resident of Kentucky. Jac files a suit against Hua in Indiana. Regarding this suit, Indiana has​

a. ​federal jurisdiction.

b. ​in personam jurisdiction.

c. ​in rem jurisdiction

d. ​no jurisdiction.

c. ​ in rem jurisdiction

5

An Oklahoma state court can exercise jurisdiction over Petro Resources Inc., an out-of-state company, if the firm has​

a. ​minimum contacts with the state.

b. ​maximum contacts with the state.

c. ​median contacts with the state.

d. ​no contacts with the state.

a. ​minimum contacts with the state.

6

Milo files a suit against Nick in an Ohio state court, noting that Nick operates a Web site through which Ohio residents have done substantial business with him. The court is most likely to have jurisdiction over Nick if Milo’s claim arises from

a. anything an Ohio resident has done.

b. Nick’s Web site activities relating to conduct in Ohio.

c. nothing an Ohio resident has done.

d. something other than Nick’s Web site.

b. Nick’s Web site activities relating to conduct in Ohio.

7

David, an Alabama resident, files suit in an Alabama court against QuickAds, an internet company based in Georgia that provides advertising services. QuickAds only contact with persons in Alabama has been through QuickAds passive advertising. The Alabama court is:

a. likely to have jurisdiction if the claim David brings is based on QuickAds advertising scheme in Alabama.

b. not likely to have jurisdiction over the case because QuickAds is based in Georgia.

c. likely to refer the case to a higher district court.

d. likely to refer the case to an appellate court.

a. likely to have jurisdiction if the claim David brings is based on QuickAds advertising scheme in Alabama.

8

McHenry, a New York resident, files a suit in a New York state court against OneWorld Inc., a company based in California. OneWorld’s only contact with McHenry is the company’s app, which McHenry downloaded while traveling across the United States. According to the sliding-scale analysis, the factor most likely to confer jurisdiction on the New York court is​

a. ​the geographical distance between McHenry and OneWorld.

b. ​the degree of interactivity via the app between McHenry and OneWorld.

c. ​OneWorld’s location when the app was created.

d. ​McHenry’s location when the app was downloaded.

b. ​the degree of interactivity via the app between McHenry and OneWorld.

9

All Bikes, Inc., a firm in Wisconsin, advertises on the Web. A court in Ohio would be most likely to exercise jurisdiction over All Bikes if the firm​

a. ​did substantial business with Ohio residents over the Internet.

b. ​interacted with any Ohio resident through its Web site.

c. ​only engaged in passive advertising on the Web.

d. ​suddenly removed its ad from the Internet.

b. ​interacted with any Ohio resident through its Web site.

10

Mediocrité, Inc., makes and sells goods that are substandard. Naomi, who has never bought or used a Mediocrité item, files a suit against the firm, alleging that its products are defective. The company’s best ground for dismissal of the suit is that Naomi does not have​

a. ​certiorari.

b. ​jurisdiction.

c. ​standing.

d. ​sufficient minimum contacts.

c. ​standing.

11

Tyler, a citizen of Utah, files a suit in a Utah state court against Virtual Sales Corporation, a Washington state company that does business in Utah. The court has original jurisdiction, which means that​

a. ​the case is being heard for the first time.

b. ​the court has a unique method of deciding whether to hear a case.

c. ​the court has unusual procedural rules.

d. ​the subject matter of the suit is interesting and new.

a. ​the case is being heard for the first time.

12

Stephan wins his suit against Tidewater Boats, Inc. Tidewater’s best ground for appeal is the trial court’s interpretation of​

a. ​the demeanor of the witnesses during the trial.

b. ​what happened to give rise to the dispute.

c. ​the dealings between the parties before the suit.

d. ​the law that applied to the issues in the case.

d. ​the law that applied to the issues in the case.

13

Delia files a suit against Eduardo in a Florida state court over the ownership of a boat docked in a Florida harbor. Both Delia and Eduardo are residents of Georgia. Eduardo could ask for a change of venue on the ground that Georgia​

a. ​has a sufficient stake in the matter.

b. ​has jurisdiction.

c. ​has sufficient minimum contacts with the parties.

d. ​is a more convenient location to hold the trial.

d. ​is a more convenient location to hold the trial.

14

Marty files a suit against Norah in a state court over an employment contract. The case proceeds to trial, after which the court renders a verdict. The case is appealed to an appellate court. After the highest state court’s review of Marty v. Norah, a party can appeal the decision to the United States Supreme Court if​

a. ​if a federal question is involved.

b. ​if a question of state law remains unresolved.

c. ​if Marty questions the result.

d. ​under no circumstances.

a. ​if a federal question is involved.

15

Kari and Lillian, who are citizens of Mississippi, are involved in a case related to the adoption of their child. Over this case, Mississippi state courts have​

a. ​concurrent jurisdiction with federal courts.

b. ​concurrent jurisdiction with other state courts.

c. ​exclusive jurisdiction.

d. ​no jurisdiction.

c. ​exclusive jurisdiction.

16

Olivia, a citizen of Nebraska, wants to file a suit against Micah, a citizen of Kansas. Their diversity of citizenship may be a basis for​

a. ​no court to exercise jurisdiction.

b. ​a federal court to exercise original jurisdiction.

c. ​a state court to exercise appellate jurisdiction.

d. ​the United States Supreme Court to refuse jurisdiction.

b. ​a federal court to exercise original jurisdiction.

17

D’Antoni files a suit in a federal district court against Enya. D’Antoni loses the suit, appeals to the U.S. Court of Appeals for the Ninth Circuit, and loses again. D’Antoni asks the United States Supreme Court to hear the case. The Court is​

a. ​not required to hear the case.

b. ​required to hear the case because D’Antoni lost in a federal court.

c. ​required to hear the case because D’Antoni lost in a lower court.

d. ​required to hear the case because it is an appeal.

a. ​not required to hear the case.

18

The case of Max v. National Credit Co. is heard in a trial court. The case of O! Boy! Ice Cream Co. v. Pecan Corp. is heard in an appellate court. The difference between a trial and an appellate court is whether​

a. ​a trial is being held.

b. ​the court is appealing.

c. ​the parties question how the law applies to their dispute.

d. ​the subject matter of the case involves complex facts.

a. ​a trial is being held.

19

Carol files a suit against Andy in a state trial court and loses. Carol can​

a. ​not take her case any higher in the court system.

b. ​insist that the United States Supreme Court hear her case.

c. ​plead her case before an appellate court.

d. ​plead her case before a small claims court.

c. ​plead her case before an appellate court.

20

Laredo loses his suit against McLain in a North Dakota state trial court. Laredo appeals to a state intermediate court of appeals and loses again. Laredo would appeal next to​

a. ​the American Arbitration Association.

b. ​the North Dakota Supreme Court.

c. ​the United States Supreme Court.

d. ​the U.S. Court of Appeals for the Eighth Circuit.

b. ​the North Dakota Supreme Court.

21

The Montana Supreme Court rules against Natural Grocery Mart in a case against One Stop 2 Shop Stores, Inc. Natural Grocery files an appeal with the United States Supreme Court. The Court does not hear the case. This​

a. ​is a decision on the merits that has value as a precedent.

b. ​indicates agreement with the Montana court’s decision.

c. ​means nothing.

d. ​means that the Montana court’s decision is the law in Montana.

d. ​means that the Montana court’s decision is the law in Montana.

22

The Kentucky Supreme Court rules against Luther in a case against Motor Cars, Inc. Luther wants to appeal the case to the United States Supreme Court. Luther must ask the Court to issue a writ of​

a. appeal.

b. ​certiorari.

c. ​jurisdiction.

d. ​summons.

b. ​ certiorari .

23

Salina files a suit against Tanner. Before going to trial, the parties, with their attorneys, meet to try to resolve their dispute. A third party suggests or proposes a resolution, which the parties may or may not adopt. This is​

a. ​arbitration.

b. ​mediation.

c. ​negotiation.

d. ​not a legitimate form of dispute resolution.

b. ​mediation.

24

First Community Credit Union and General Hydraulics. Inc., have their dispute resolved in arbitration. Before determining the award, the arbitrator meets with First Community’s representative to discuss the dispute without General Hydraulics’ representative being present. If this meeting substantially prejudices General Hydraulics’ rights, a court will most likely​

a. ​compel arbitration.

b. ​review the merits of the dispute.

c. ​review the sufficiency of the evidence.

d. ​set aside any award.

d. ​set aside any award.

25

Sforza files a suit against Thieu. If this suit is like most cases, it will be​

a. ​dismissed during a trial.

b. ​settled before a trial.

c. ​resolved only after a trial.

d. ​appealed to a higher court.

b. ​settled before a trial.

26

Liz and Moss disagree over the amount due under their contract. To avoid involving any third party in the resolution of their dispute, Liz and Moss might prefer to use the alternative dispute resolution method of​

a. ​arbitration.

b. ​litigation.

c. ​mediation.

d. ​negotiation.

d. ​negotiation.

27

Farmers Pantry Products Inc. and Market Grocers LLC dispute a term in their contract. If Farmers Pantry and Market Grocers have a long-standing business relationship that they would like to continue, they may prefer to settle their dispute through mediation because​

a. ​the case will be heard by a jury.

b. ​the dispute will eventually go to trial.

c. ​the process is not adversarial.

d. ​the resolution of the dispute will be decided an expert.

c. ​the process is not adversarial.

28

If Cornel and Deanna resolve their dispute by having a neutral third party render a binding decision, they will have used the method of​

a. ​arbitration.

b. ​conciliation.

c. ​intervention.

d. ​mediation.

a. ​arbitration.

29

SPF Sunscreen Corporation and Taylor agree to resolve their dispute through arbitration. The arbitrator’s decision is called​

a. ​a conclusion of law.

b. ​a finding of fact.

c. ​an award.

d. ​a verdict.

c. ​an award.

30

Sour Dough Inc. and The Bread Company, agree to a contract that includes an arbitration clause. If a dispute arises, a court having jurisdiction may​

a. ​monitor any arbitration until it concludes.

b. ​order an arbitrator to rule in a particular way.

c. ​order a party to bring the dispute to court.

d. ​order a party to submit to arbitration.

d. ​order a party to submit to arbitration.

31

Cullen files a suit against Demi. Cullen and Demi meet, and each party’s attorney argues the party’s case before a judge and jury. The jury presents an advisory verdict, after which the judge meets with the parties to encourage them to settle their dispute. This is​

a. ​court-ordered arbitration.

b. ​early neutral case evaluation.

c. ​a mini-trial.

d. ​a summary jury trial.

d. ​a summary jury trial.

32

Service Employees International Union and Timberline Products, Inc., have their dis-pute resolved in arbitration. The arbitrator arbitrates issues that the parties did not agree to submit to arbitration. This is a ground for a court to​

a. ​none of the choices.

b. ​review the merits of the dispute.

c. ​review the sufficiency of the evidence.

d. ​set aside the award.

d. ​set aside the award.

33

Millie and Noble dispute the quality of a suite of furniture sold over the Internet. They agree to resolve their dispute in OpenTerms.com, an online forum. Like most online forums, OpenTerms.com applies​

a. ​general, universal legal principles.

b. ​the provisions of the Federal Magistrates Act.

c. ​international principles provided by the United Nations.

d. ​the law of the Internet.

a. ​general, universal legal principles.

34

Quest Inc., a U.S. firm, and Real Treks, Ltd., a Canadian firm, enter into a contract that does not have a forum-selection or choice-of-law clause. Litigation between Quest and Real Treks involving this contract may occur in​

a. ​an online forum only.

b. ​Canada or the United States, but not both.

c. ​Canada, the United States, or both.

d. ​an international, United Nations tribunal only.

c. ​Canada, the United States, or both.

35

To resolve a dispute in nonbinding arbitration, Alyson in Baltimore and Chuck in Denver utilize E-Resolve, an online dispute resolution (ODR) service. This limits these parties’ recourse to the courts​

a. ​not at all.

b. ​until the ODR service has issued a decision.

c. ​with respect to any dispute arising between them.

d. ​with respect to this dispute only.

a. ​not at all.