Canadian Business Law Today 1st Edition By Nancy Breen – Test Bank

 

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Sample Test

Chapter 03

Tort Law

 

 

True / False Questions

1.   A person who commits a tort is called a tortfeasor.
TRUE

 

Blooms: Remember
Learning Objective: 03-01 Define the concept of tort law.
Topic: 03-01 What Is Tort Law?

2.   Tort law is law related to wrongdoing by a business or individual.
TRUE

 

Blooms: Remember
Learning Objective: 03-01 Define the concept of tort law.
Topic: 03-01 What Is Tort Law?

3.   A tort is an action committed by an individual or business that causes injury or harm to another individual or business.
TRUE

 

Blooms: Remember
Learning Objective: 03-01 Define the concept of tort law.
Topic: 03-01 What Is Tort Law?

4.   To be successful in a tort action, parties must also show they had a contractual relationship.
FALSE

 

Blooms: Remember
Learning Objective: 03-01 Define the concept of tort law.
Topic: 03-01 What Is Tort Law?

 

5.   Tort law can affect a business’s everyday activities.
TRUE

 

Blooms: Remember
Learning Objective: 03-01 Define the concept of tort law.
Topic: 03-01 What Is Tort Law?

6.   Tort law does not affect a business’s everyday activities.
FALSE

 

Blooms: Remember
Learning Objective: 03-01 Define the concept of tort law.
Topic: 03-01 What Is Tort Law?

7.   An intentional tort is when a business or person deliberately causes harm to another.
TRUE

 

Blooms: Remember
Learning Objective: 03-02 Differentiate between intentional torts and unintentional torts.
Topic: 03-02 Intentional and Unintentional Torts

8.   An unintentional tort is careless, inadvertent conduct on the part of the tortfeasor.
TRUE

 

Blooms: Remember
Learning Objective: 03-02 Differentiate between intentional torts and unintentional torts.
Topic: 03-02 Intentional and Unintentional Torts

9.   An intentional tort is when a business or person does not mean to cause harm to another.
FALSE

 

Blooms: Remember
Learning Objective: 03-02 Differentiate between intentional torts and unintentional torts.
Topic: 03-02 Intentional and Unintentional Torts

 

10.                A business owner may be responsible for the torts committed by their employees.
TRUE

 

Blooms: Remember
Learning Objective: 03-02 Differentiate between intentional torts and unintentional torts.
Topic: 03-02 Intentional and Unintentional Torts

11.                Based on the principle of vicarious liability, a business owner will not be responsible for the torts committed by their employees.
FALSE

 

Blooms: Remember
Learning Objective: 03-02 Differentiate between intentional torts and unintentional torts.
Topic: 03-02 Intentional and Unintentional Torts

12.                Business exposure involves recognizing what is a wrong action and how to avoid that exposure.
TRUE

 

Blooms: Remember
Learning Objective: 03-02 Differentiate between intentional torts and unintentional torts.
Topic: 03-02 Intentional and Unintentional Torts

13.                A remedy is what the court awards a successful party in a lawsuit.
TRUE

 

Blooms: Remember
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-03 Types of Intentional Torts

14.                The purpose of a remedy is to restore the injured party to the position they were in before the tort happened.
TRUE

 

Blooms: Remember
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-03 Types of Intentional Torts

 

15.                Battery is the harm caused by intentional contact.
TRUE

 

Blooms: Remember
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-03 Types of Intentional Torts

16.                Assault is the threat of immanent battery.
TRUE

 

Blooms: Remember
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-03 Types of Intentional Torts

17.                Consent is not a defence to the tort of battery.
FALSE

 

Blooms: Remember
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-03 Types of Intentional Torts

18.                False imprisonment is when you unlawfully confine a person within a specified area.
TRUE

 

Blooms: Remember
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-04 Intentional Torts Involving Customers

19.                A store security guard can detain a suspected shoplifter without fear of being sued for false imprisonment.
FALSE

 

Blooms: Remember
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-04 Intentional Torts Involving Customers

 

20.                Justin, a department store detective, saw Stephen slip some merchandise into his pocket. Justin followed him out of the store and stopped Stephen without touching him. Justin then quietly and politely asked Stephen to accompany him to the security office. Stephen agreed, but when his pockets were searched, nothing was found. Stephen can successfully sue the department store for false imprisonment.
FALSE

 

Blooms: Understand
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-04 Intentional Torts Involving Customers

21.                Passing off is when a defendant represents a plaintiffs’ goods or services as if it were one’s own products or services and thereby confuses the public.
TRUE

 

Blooms: Remember
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-05 Intentional Torts Involving Other Businesses

22.                If a defendant deliberately causes a breach in a contract between two parties, she or he may be sued for inducing breach of contract.
TRUE

 

Blooms: Remember
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-05 Intentional Torts Involving Other Businesses

23.                If an employee steals confidential information from his employer and gives it to a business competitor, he may be sued for interference with economic relations.
TRUE

 

Blooms: Remember
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-05 Intentional Torts Involving Other Businesses

 

24.                Trespass to land is when you enter onto, or place something onto, someone’s land without their consent.
TRUE

 

Blooms: Remember
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-06 Intentional Torts Involving Business Property

25.                Even when a business has an “Open” sign on their building, you are trespassing.
FALSE

 

Blooms: Remember
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-06 Intentional Torts Involving Business Property

26.                An “Open” sign is an implied invitation to enter onto someone’s land and this does not constitute trespass.
TRUE

 

Blooms: Remember
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-06 Intentional Torts Involving Business Property

27.                Trespass to chattels is causing damage to or interfering with a person’s personal property.
TRUE

 

Blooms: Remember
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-06 Intentional Torts Involving Business Property

28.                When a person finds that the normal use and enjoyment of her land is being interfered with by fumes from her neighbour, she may be able to sue for private nuisance.
TRUE

 

Blooms: Remember
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-06 Intentional Torts Involving Business Property

 

29.                Defamation is publishing a false statement that harms a person’s reputation.
TRUE

 

Blooms: Remember
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-07 Intentional Torts from Words

30.                Libel is the written form of defamation.
TRUE

 

Blooms: Remember
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-07 Intentional Torts from Words

31.                Slander is the written form of defamation.
FALSE

 

Blooms: Remember
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-07 Intentional Torts from Words

32.                Libel is the spoken form of defamation.
FALSE

 

Blooms: Remember
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-07 Intentional Torts from Words

33.                Slander is the spoken form of defamation.
TRUE

 

Blooms: Remember
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-07 Intentional Torts from Words

 

34.                Injurious falsehood is also called “slander of goods”.
TRUE

 

Blooms: Remember
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-07 Intentional Torts from Words

35.                A plaintiff would not be successful in a defamation lawsuit if the defendant had evidence to prove the statement was true.
TRUE

 

Blooms: Remember
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-07 Intentional Torts from Words

36.                To succeed in a lawsuit, a plaintiff must prove that the defendant’s statement was false.
FALSE

 

Blooms: Remember
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-07 Intentional Torts from Words

37.                Defamatory statements made at a staff meeting are subject to absolute privilege.
FALSE

 

Blooms: Remember
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-07 Intentional Torts from Words

38.                Injury to one’s reputation by a false statement, where the statement is not subject to privilege, is a tort.
TRUE

 

Blooms: Remember
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-07 Intentional Torts from Words

 

39.                Invasion of privacy is any unreasonable interference with someone’s privacy or private information.
TRUE

 

Blooms: Remember
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-08 Intentional Torts Relating to Privacy

40.                Negligence is a careless, inadvertent, action that causes injury or harm to another.
TRUE

 

Blooms: Remember
Learning Objective: 03-04 Consider the defences to unintentional torts.
Topic: 03-09 Unintentional Torts and Their Defences

41.                You won’t be found negligent if you did not intend to do any harm.
FALSE

 

Blooms: Remember
Learning Objective: 03-04 Consider the defences to unintentional torts.
Topic: 03-09 Unintentional Torts and Their Defences

42.                Actions that fall below social acceptable standards, even when they are accidental, create liability for damages.
TRUE

 

Blooms: Remember
Learning Objective: 03-04 Consider the defences to unintentional torts.
Topic: 03-09 Unintentional Torts and Their Defences

43.                A duty of care is owed by one individual or business to another.
TRUE

 

Blooms: Remember
Learning Objective: 03-04 Consider the defences to unintentional torts.
Topic: 03-10 Duty of Care

 

44.                When a court is trying to assess liability in a negligence action, it asks the question, “What would a reasonable person have done in these circumstances?”
TRUE

 

Blooms: Remember
Learning Objective: 03-04 Consider the defences to unintentional torts.
Topic: 03-10 Duty of Care

45.                When a court is trying to assess liability in a negligence action, it asks the question, “What would an average person have done in these circumstances?”
FALSE

 

Blooms: Remember
Learning Objective: 03-04 Consider the defences to unintentional torts.
Topic: 03-10 Duty of Care

46.                The reasonable foreseeability test is used to determine whether a duty of care is owed.
TRUE

 

Blooms: Remember
Learning Objective: 03-04 Consider the defences to unintentional torts.
Topic: 03-10 Duty of Care

47.                On a cold winter day, Maya slipped on the icy sidewalk at the entrance to Wes’s shop. Maya injured her ankle as a result of the fall, and Wes hired a taxi to take Maya to the hospital to have her injured ankle examined. On the way to the hospital another vehicle collided with the taxi, and Maya was seriously injured. The court would likely consider what a reasonable person would have done or foreseen in determining the duty of care in this case.
TRUE

 

Blooms: Remember
Learning Objective: 03-04 Consider the defences to unintentional torts.
Topic: 03-11 Standard of Care and Breach of Duty

 

48.                In the example above, Wes would be liable for the injury suffered by Maya when Maya slipped on the sidewalk in front of his shop, because he should have foreseen the possibility of injury to customers when he failed to remove the ice.
TRUE

 

Blooms: Remember
Learning Objective: 03-04 Consider the defences to unintentional torts.
Topic: 03-11 Standard of Care and Breach of Duty

49.                In the example above, Wes is liable for the injury to Maya as a result of the car accident, because she would not have been travelling in the taxi if she had not injured her ankle at Wes’s store.
FALSE

 

Blooms: Remember
Learning Objective: 03-04 Consider the defences to unintentional torts.
Topic: 03-12 Causation

50.                In the example above, the injured ankle was the proximate cause of Maya’s more serious injury in the automobile accident because Wes had hired the taxi to send her to the hospital.
FALSE

 

Blooms: Remember
Learning Objective: 03-04 Consider the defences to unintentional torts.
Topic: 03-12 Causation

51.                In the example above, Wes’s actions were too remote to be the cause of the car accident in which Maya received serious injuries.
TRUE

 

Blooms: Remember
Learning Objective: 03-04 Consider the defences to unintentional torts.
Topic: 03-14 Remoteness of Damage

 

52.                In the example above, Maya was the author of her own misfortune because she should have foreseen the risk of injury by walking on an icy sidewalk.
FALSE

 

Blooms: Remember
Learning Objective: 03-04 Consider the defences to unintentional torts.
Topic: 03-15 Contributory Negligence

53.                In the example above, If Maya took legal action against Wes, Wes might plead voluntary assumption of risk as a defence.
TRUE

 

Blooms: Remember
Learning Objective: 03-04 Consider the defences to unintentional torts.
Topic: 03-16 Assumption of Risk

54.                Understanding the legal problems associated with your business can help avoid lawsuits.
TRUE

 

Blooms: Remember
Learning Objective: 03-05 Discuss the application of risk management when dealing with torts.
Topic: 03-17 Risk Management Regarding Torts

55.                Understanding when a legal issue has arisen helps you to know when to call a lawyer.
TRUE

 

Blooms: Remember
Learning Objective: 03-05 Discuss the application of risk management when dealing with torts.
Topic: 03-17 Risk Management Regarding Torts

 

Multiple Choice Questions
 

56.                Which of the following statements is correct with respect to tort law?
A.An act must be intentional to be classified as a tort
B. A wrongful act can be both a crime and a tort
C. The main purpose of tort law is to punish a tortfeasor
D. The main purpose of tort law is to deter crime

 

Blooms: Understand
Learning Objective: 03-01 Define the concept of tort law.
Topic: 03-01 What Is Tort Law?

57.                Which of the following is not an intentional tort?
A.Assault
B. Defamation
C. Negligence
D. Trespass

 

Blooms: Understand
Learning Objective: 03-02 Differentiate between intentional torts and unintentional torts.
Topic: 03-02 Intentional and Unintentional Torts

58.                Jack and Diane decided to go into partnership for a manufacturing business. Jack raised $250,000 in start-up funds, in large part on the basis of documents that he forged. These documents purported to show that Jack and Diane owned their factory, when in fact they merely leased it. Jack spent all of the money on himself, and he now has no assets and has been jailed for 10 years. The creditors have contacted Diane and told her they will hold her liable for the loss.
A.Diane is both civilly and criminally liable for Jack’s actions
B. Diane can argue assumption of risk in her defence of Jack’s actions
C. Diane is vicariously liable for Jack’s action
D. Diane is not liable as she was not aware of Jack’s actions

 

Blooms: Apply
Learning Objective: 03-02 Differentiate between intentional torts and unintentional torts.
Topic: 03-02 Intentional and Unintentional Torts

 

59.                A person sued for assault and battery cannot claim which of the following as a defence?
A.I didn’t mean to do it
B. I was only defending myself
C. The injured person agreed
D. The injured person consented

 

Blooms: Understand
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-03 Types of Intentional Torts

60.                A bouncer who uses force to remove a patron from a bar is liable for injuries to the patron if the amount of force, given the size, strength, and amount of resistance of the patron is:
A.excessive
B. extreme
C. predictable
D. reasonable

 

Blooms: Understand
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-03 Types of Intentional Torts

61.                Which of the following actions constitutes an assault?
A.A bystander is struck by a ball during a soccer game
B. Someone points a gun at another person who does not see the gun
C. The person in the vehicle next to you makes an offensive, threatening gesture to you
D. You bump into someone in the mall

 

Blooms: Understand
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-03 Types of Intentional Torts

 

62.                A business in the service industry, may find its employees becoming involved in altercations with customers in the course of their work. Such altercations:
A.Are extremely rare and so are not worthy of concern
B. Can lead to employees being held liable, but will not impact the business itself
C. Can result in actions against the business on the basis of vicarious liability
D. May be inconvenient, but do not expose the business to liability

 

Blooms: Apply
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-03 Types of Intentional Torts

63.                Which of the following is not an example of a business to business tort?
A.Assault
B. Conspiracy
C. Deceit
D. Intimidation

 

Blooms: Understand
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-05 Intentional Torts Involving Other Businesses

64.                A person could be liable for the tort of trespass for:
A.accidentally knocking down the garage in a car that is out of control
B. leaving packages in the wrong person’s garage
C. leaving the wrong packages in the right person’s garage
D. sleeping in the garage with the owner’s permission

 

Blooms: Apply
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-06 Intentional Torts Involving Business Property

 

65.                Claire required a reference for a new job. She asked for a letter from her former employer, Alice. Alice wrote that Claire was honest, hard-working, intelligent, and a pleasant person who would do best in a job with considerable direction and supervision. Since Claire had applied for work in outside sales, she was turned down as the job needed an independent self-starter. Claire sued Alice for libel.
A.Alice can successfully raise the defence of absolute privilege
B. Alice can successfully raise the defence of fair comment
C. Alice can successfully raise the defence of qualified privilege
D. Alice can successfully raise the defence of freedom of speech

 

Blooms: Apply
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-07 Intentional Torts from Words

66.                Which of the following is not a defence to defamation?
A.The statement was absolute privilege
B. The statement was fair comment
C. The statement was qualified privilege
D. The statement was false

 

Blooms: Understand
Learning Objective: 03-03 Identify the types of intentional torts.
Topic: 03-07 Intentional Torts from Words

67.                The required elements of the tort of negligence do not include which of the following?
A.A breach of care
B. A contributory injury
C. A duty of care
D. A foreseeable injury

 

Blooms: Understand
Learning Objective: 03-04 Consider the defences to unintentional torts.
Topic: 03-09 Unintentional Torts and Their Defences

 

68.                Which of the following situations would not lead to a claim for negligence?
A.A business failed to put out a ‘slippery when wet’ sign after the floor was cleaned
B. A business left a pipe on the front of the sidewalk next to the restaurant floor
C. A customer opened a soft drink can and ingested a toxic substance
D. A customer leaves the store angrily when he was told that the item he wanted is not available

 

Blooms: Understand
Learning Objective: 03-04 Consider the defences to unintentional torts.
Topic: 03-09 Unintentional Torts and Their Defences

69.                Which one of the following statements about the case Donoghue v. Stevenson is false?
A.It says that a manufacturer is not liable for injury caused by its product
B. It says that a manufacturer is liable for injury caused by its product
C. It set a precedent in the law of negligence
D. It set the test to determine that a duty is owed to public

 

Blooms: Understand
Learning Objective: 03-04 Consider the defences to unintentional torts.
Topic: 03-10 Duty of Care

70.                Which of the following statements is the test used by the courts to determine if a duty of care was owed?
A.Would an average person have acted like that in these circumstances
B. Would an average person have foreseen that type of injury
C. Would a reasonable person have acted like that in these circumstances
D. Would a reasonable person have foreseen that type of injury

 

Blooms: Understand
Learning Objective: 03-04 Consider the defences to unintentional torts.
Topic: 03-11 Standard of Care and Breach of Duty

 

71.                With regard to the law of negligence, which of the following is false?
A.If the court finds that the plaintiff was 40 percent responsible and the defendant was 60 percent responsible for the loss suffered by the plaintiff, the plaintiff cannot recover more than 60 percent in damages from the defendant
B. If you hurt someone and are sued for negligence, a possible defence is that you didn’t intend to hurt the person
C. Some occupiers’ liability acts set the standard of care owed by the occupier-namely, to take reasonable care that any person is reasonably safe
D. To win his action in negligence, a plaintiff must prove, among other things, that the defendant owed the plaintiff a duty of care

 

Blooms: Understand
Learning Objective: 03-04 Consider the defences to unintentional torts.
Topic: 03-13 Defences for Unintentional Torts

72.                Which of the following statements with regard to the tort of negligence is false?
A.A possible defence to the plaintiff’s claim of negligence is that the plaintiff volunteered to take the risk
B. If a person is injured by a defective product that he himself did not purchase, he can sue the manufacturer for negligence
C. If physical injury can be foreseen as the result of a person’s negligence, this person will be liable for all the injury suffered although the person injured was unusually weak and infirm
D. If the court finds contributory negligence, the defendant has no liability at all

 

Blooms: Understand
Learning Objective: 03-04 Consider the defences to unintentional torts.
Topic: 03-16 Assumption of Risk

73.                As a form of risk management, you would know when to seek legal advice if you believed your business was about to be involved in a tort action. You know that prior to the meeting you have tried to minimize the risk. Which of the following is not a risk management tool?
A.Anticipating and assessing possible legal risks involved in your business actions
B. Assessing the possible legal risks after an action has been commenced against you
C. Understanding the statutes involved in your business and jurisdiction
D. Understanding what questions need to be asked of the lawyer

 

Blooms: Understand
Learning Objective: 03-05 Discuss the application of risk management when dealing with torts.
Topic: 03-17 Risk Management Regarding Torts

 

Chapter 05

Elements of Contracts, E-Commerce and Technology

 

 

True / False Questions

1.   A contract is an exchange of promises between two or more parties which can be enforced by the court.
TRUE

 

Blooms: Remember
Learning Objective: 05-01 Know what a contract is.
Topic: 05-01 What Is a Contract?

2.   Contracts are the most common and basic legal document used by a business.
TRUE

 

Blooms: Remember
Learning Objective: 05-01 Know what a contract is.
Topic: 05-01 What Is a Contract?

3.   From a risk management perspective, contracts do not need to be in writing.
FALSE

 

Blooms: Remember
Learning Objective: 05-01 Know what a contract is.
Topic: 05-01 What Is a Contract?

4.   Contract law deals with the legal principles and rules that allow enforceable agreements to be created.
TRUE

 

Blooms: Remember
Learning Objective: 05-01 Know what a contract is.
Topic: 05-01 What Is a Contract?

 

5.   There are no exceptions to the parties’ ability to create any enforceable agreement they desire.
FALSE

 

Blooms: Remember
Learning Objective: 05-01 Know what a contract is.
Topic: 05-01 What Is a Contract?

6.   There are no exceptions to the substantive aspects of contracts within the control of the parties.
FALSE

 

Blooms: Remember
Learning Objective: 05-01 Know what a contract is.
Topic: 05-01 What Is a Contract?

7.   A contract is formed when there is a meeting of the minds.
TRUE

 

Blooms: Remember
Learning Objective: 05-01 Know what a contract is.
Topic: 05-01 What Is a Contract?

8.   Businesses use contracts to buy and sell goods and services.
TRUE

 

Blooms: Remember
Learning Objective: 05-01 Know what a contract is.
Topic: 05-01 What Is a Contract?

9.   A contract can exist in either a written, verbal, or implied form.
TRUE

 

Blooms: Remember
Learning Objective: 05-01 Know what a contract is.
Topic: 05-01 What Is a Contract?

 

10.                A simple agreement between friends is an enforceable contract.
FALSE

 

Blooms: Remember
Learning Objective: 05-02 Know what separates a contract from an agreement.
Topic: 05-02 Contract vs. Simple Agreement

11.                Keeping a contract short is the best way to avoid legal disputes arising from the contract.
FALSE

 

Blooms: Remember
Learning Objective: 05-02 Know what separates a contract from an agreement.
Topic: 05-02 Contract vs. Simple Agreement

12.                Express terms are those terms negotiated specifically by the parties and specified in the contract.
TRUE

 

Blooms: Remember
Learning Objective: 05-02 Know what separates a contract from an agreement.
Topic: 05-02 Contract vs. Simple Agreement

13.                Implied terms are those terms not specifically negotiated by the parties but are implied in the contract.
TRUE

 

Blooms: Remember
Learning Objective: 05-02 Know what separates a contract from an agreement.
Topic: 05-02 Contract vs. Simple Agreement

14.                Implied terms are those terms negotiated specifically by the parties and specified in the contract.
FALSE

 

Blooms: Remember
Learning Objective: 05-02 Know what separates a contract from an agreement.
Topic: 05-02 Contract vs. Simple Agreement

 

15.                Express terms are those terms not specifically negotiated by the parties but are implied in the contract.
FALSE

 

Blooms: Remember
Learning Objective: 05-02 Know what separates a contract from an agreement.
Topic: 05-02 Contract vs. Simple Agreement

16.                A contract is a business’s basic protection in a commercial transaction.
TRUE

 

Blooms: Remember
Learning Objective: 05-03 Know why contracts are useful and needed.
Topic: 05-03 Why are Contracts Needed?

17.                Each province has enacted statute law to govern all business contract disputes.
FALSE

 

Blooms: Remember
Learning Objective: 05-03 Know why contracts are useful and needed.
Topic: 05-03 Why are Contracts Needed?

18.                The courts generally presume parties intend to be legally bound by a contract.
TRUE

 

Blooms: Remember
Learning Objective: 05-03 Know why contracts are useful and needed.
Topic: 05-03 Why are Contracts Needed?

19.                If you enter into a valid contract that was not in your best interest, the Court will assist you in getting out of the contract.
FALSE

 

Blooms: Remember
Learning Objective: 05-03 Know why contracts are useful and needed.
Topic: 05-03 Why are Contracts Needed?

 

20.                Basic contract law does not apply to online contracts.
FALSE

 

Blooms: Remember
Learning Objective: 05-03 Know why contracts are useful and needed.
Topic: 05-03 Why are Contracts Needed?

21.                Basic contract law does apply to online contracts.
TRUE

 

Blooms: Remember
Learning Objective: 05-03 Know why contracts are useful and needed.
Topic: 05-03 Why are Contracts Needed?

22.                International e-commerce contracts are not valid in Canada.
FALSE

 

Blooms: Remember
Learning Objective: 05-03 Know why contracts are useful and needed.
Topic: 05-03 Why are Contracts Needed?

23.                All levels of Canadian government are working on laws to recognize e-commerce contracts as valid enforceable contracts.
TRUE

 

Blooms: Remember
Learning Objective: 05-03 Know why contracts are useful and needed.
Topic: 05-03 Why are Contracts Needed?

24.                The person making an offer is the offeror.
TRUE

 

Blooms: Remember
Learning Objective: 05-04 Recognize the differences between an invitation to treat and an offer.
Topic: 05-04 Before the Contract: Invitation to Treat

 

25.                The person making an offer is the offeree.
FALSE

 

Blooms: Remember
Learning Objective: 05-04 Recognize the differences between an invitation to treat and an offer.
Topic: 05-04 Before the Contract: Invitation to Treat

26.                The person receiving an offer is the offeror.
FALSE

 

Blooms: Remember
Learning Objective: 05-04 Recognize the differences between an invitation to treat and an offer.
Topic: 05-04 Before the Contract: Invitation to Treat

27.                The person receiving an offer is the offeree.
TRUE

 

Blooms: Remember
Learning Objective: 05-04 Recognize the differences between an invitation to treat and an offer.
Topic: 05-04 Before the Contract: Invitation to Treat

28.                An offer is a willingness to form a contract.
FALSE

 

Blooms: Remember
Learning Objective: 05-04 Recognize the differences between an invitation to treat and an offer.
Topic: 05-04 Before the Contract: Invitation to Treat

29.                An invitation to treat is a willingness to form a contract.
TRUE

 

Blooms: Remember
Learning Objective: 05-04 Recognize the differences between an invitation to treat and an offer.
Topic: 05-04 Before the Contract: Invitation to Treat

 

30.                An invitation to treat is another term for offer.
FALSE

 

Blooms: Remember
Learning Objective: 05-04 Recognize the differences between an invitation to treat and an offer.
Topic: 05-04 Before the Contract: Invitation to Treat

31.                There are four (4) requirements to contract formation.
TRUE

 

Blooms: Remember
Learning Objective: 05-05 Understand the elements of a contract.
Topic: 05-05 Introduction to Contract Requirements: Offer, Acceptance, Consideration, Intention

32.                An offer specifies the parties involved, the product, and the price.
TRUE

 

Blooms: Remember
Learning Objective: 05-05 Understand the elements of a contract.
Topic: 05-06 Offer

33.                An offer is when both parties understand and agree to the terms of a contract.
TRUE

 

Blooms: Remember
Learning Objective: 05-05 Understand the elements of a contract.
Topic: 05-06 Offer

34.                Acceptance is when one party agrees to the terms of the offer.
TRUE

 

Blooms: Remember
Learning Objective: 05-05 Understand the elements of a contract.
Topic: 05-07 Acceptance

 

35.                Acceptance must be communicated by the offeree to the offeror.
TRUE

 

Blooms: Remember
Learning Objective: 05-05 Understand the elements of a contract.
Topic: 05-07 Acceptance

36.                Consideration is the value one is willing to pay or receive for the promise agreed to in an offer.
TRUE

 

Blooms: Remember
Learning Objective: 05-05 Understand the elements of a contract.
Topic: 05-08 Consideration

37.                Susan offered to pay $500 for a ring that Donna has agreed to sell to her. Each woman has given consideration to the other for her promise.
TRUE

 

Blooms: Remember
Learning Objective: 05-05 Understand the elements of a contract.
Topic: 05-08 Consideration

38.                Parties to a contract must intend to create legally binding obligations.
TRUE

 

Blooms: Remember
Learning Objective: 05-05 Understand the elements of a contract.
Topic: 05-09 Intention

39.                A counter offer creates a new offer.
TRUE

 

Blooms: Remember
Learning Objective: 05-06 Know how valid consideration and intention affect a contract.
Topic: 05-11 Offer

 

40.                Andy offers to sell his car to Bob, but Bob needs to arrange financing, so Andy says he will give Bob three days to do so. Andy can revoke the offer before the three days are up.
TRUE

 

Blooms: Apply
Learning Objective: 05-06 Know how valid consideration and intention affect a contract.
Topic: 05-11 Offer

41.                Jill has been negotiating the purchase of a speedboat with Sandi for the last two weeks. Two days ago, she emailed Sandi, saying “I won’t go any higher than $8,000 and that includes the trailer. Take it or leave it, but that’s my final offer.” Sandi sent an email the same day that said “I will accept $8,000, but not including the trailer.” There is a contract between Jill and Sandi.
FALSE

 

Blooms: Apply
Learning Objective: 05-06 Know how valid consideration and intention affect a contract.
Topic: 05-12 Acceptance

42.                Unless otherwise stated acceptance of an offer can be by any reasonable method.
TRUE

 

Blooms: Remember
Learning Objective: 05-06 Know how valid consideration and intention affect a contract.
Topic: 05-12 Acceptance

43.                The post box rule governs acceptance of an offer over a distance.
TRUE

 

Blooms: Remember
Learning Objective: 05-06 Know how valid consideration and intention affect a contract.
Topic: 05-12 Acceptance

 

44.                Under the Electronic Commerce Act, acceptance occurs when the offeree sends the email.
TRUE

 

Blooms: Remember
Learning Objective: 05-06 Know how valid consideration and intention affect a contract.
Topic: 05-12 Acceptance

45.                Under the Electronic Commerce Act, acceptance occurs when the offeror receives and opens the email.
FALSE

 

Blooms: Remember
Learning Objective: 05-06 Know how valid consideration and intention affect a contract.
Topic: 05-12 Acceptance

46.                Mary loves to shop online, particularly from one online retailer. She recently purchased two items that were sent to her home. She contacted the company and wanted to return the items. The Company said “You clicked the ‘I agree’ button. We do not accept returns.” Mary should be able to successfully argue that there was no contract as she did not agree to the “no return” policy.
FALSE

 

Blooms: Apply
Learning Objective: 05-06 Know how valid consideration and intention affect a contract.
Topic: 05-12 Acceptance

47.                Jeremy agrees not to sue Angela for having crashed into his car if she agrees to pay for his repairs. Since he promised only not to do something that he could have done, he has not given consideration for her promise to pay.
FALSE

 

Blooms: Apply
Learning Objective: 05-06 Know how valid consideration and intention affect a contract.
Topic: 05-13 Consideration

 

48.                McSweeney agrees to clear out Broad’s basement, but no price is set at the time. Broad argues, once McSweeney has done the work, that since no price was agreed upon, he should pay only a reasonable price and not the excessive amount stated in the bill presented to him by McSweeney. He is right.
TRUE

 

Blooms: Apply
Learning Objective: 05-06 Know how valid consideration and intention affect a contract.
Topic: 05-13 Consideration

49.                Quantum meruit means paying as much is deserved.
TRUE

 

Blooms: Remember
Learning Objective: 05-06 Know how valid consideration and intention affect a contract.
Topic: 05-13 Consideration

50.                A person can be required to perform on a contract for a service provided gratuitously.
TRUE

 

Blooms: Remember
Learning Objective: 05-06 Know how valid consideration and intention affect a contract.
Topic: 05-13 Consideration

51.                In business relationships, the courts will presume that parties have an intention to enter into a contact.
TRUE

 

Blooms: Remember
Learning Objective: 05-06 Know how valid consideration and intention affect a contract.
Topic: 05-14 Intention

 

52.                In contracts between family members, the courts will presume that parties have an intention to enter into a contract.
FALSE

 

Blooms: Remember
Learning Objective: 05-06 Know how valid consideration and intention affect a contract.
Topic: 05-14 Intention

53.                In contracts between family members, the courts will not presume that parties have an intention to enter into a contact.
TRUE

 

Blooms: Remember
Learning Objective: 05-06 Know how valid consideration and intention affect a contract.
Topic: 05-14 Intention

54.                In business relationships, the courts will not presume that parties have an intention to enter into a contract.
FALSE

 

Blooms: Remember
Learning Objective: 05-06 Know how valid consideration and intention affect a contract.
Topic: 05-14 Intention

55.                Alliston enters into an agreement with Berkley that, for $2,000, gives him the right to agree to purchase Berkley’s screen printing business within the next 30 days for $50,000. If Alliston decides to buy, they agree that the $2,000 will be the down payment on the purchase price. This agreement is an option.
FALSE

 

Blooms: Apply
Learning Objective: 05-07 Recognize what option agreements are.
Topic: 05-15 Option Agreements

 

56.                An option agreement allows for a contract to remain open for a specified time.
TRUE

 

Blooms: Remember
Learning Objective: 05-07 Recognize what option agreements are.
Topic: 05-15 Option Agreements

57.                An option agreement is enforceable when separate consideration is paid to the offeree.
TRUE

 

Blooms: Remember
Learning Objective: 05-07 Recognize what option agreements are.
Topic: 05-15 Option Agreements

58.                Express terms in a contract must be clear and not ambiguous.
TRUE

 

Blooms: Remember
Learning Objective: 05-08 Understand the express and implied terms of a contract.
Topic: 05-17 Express and Implied Terms

59.                Implied terms in a contract must be clear and not ambiguous.
FALSE

 

Blooms: Remember
Learning Objective: 05-08 Understand the express and implied terms of a contract.
Topic: 05-17 Express and Implied Terms

60.                Judge may add implied terms to a contract to give meaning to the words in the contract.
TRUE

 

Blooms: Remember
Learning Objective: 05-08 Understand the express and implied terms of a contract.
Topic: 05-17 Express and Implied Terms