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Law
Q:
An agent's implied authority is derived from an agent's apparent authority and consists of what is reasonably necessary for carrying out the agent's grant of express authority.
Q:
An agent may use implied authority reasonably necessary to achieve the specific goals she is to achieve.
Q:
Agents may have contract remedies available against principals, but not tort remedies.
Q:
An agent's obligation to act in the interest of the principal is known as a duty of performance.
Q:
An agent may be required to indemnify the principal if a third party sues the principal.
Q:
If the worker is a regular part of the business of the employer and is paid in regular payments according to time, that worker can be classified as an independent contractor.
Q:
While an agent owes duties to a principal, the principal owes no duties to an agent.
Q:
A principal may be entitled to a variety of contract and tort remedies beyond those stated in their agreement if an agent breaches duties owed to that principal.
Q:
Agency relationships must be created by expressed agreement.
Q:
An agency relationship that arises when an individual misrepresents herself as an agent for another party and that party accepts the unauthorized act is an agency by ratification.
Q:
All employees are agents of their employers, and all agents are employees.
Q:
A person who is hired to perform a task for another but who is not the other's employee is called an independent contractor.
Q:
A power of attorney must be for a specific purpose, not a general authority.
Q:
A durable power of attorney is legally binding after the principal becomes incapacitated.
Q:
A gratuitous agent is one who acts without consideration.
Q:
An individual who lacks contractual capacity may hire an agent to make contracts on his or her behalf.
Q:
A power of attorney is a document that gives an agent authority to sign legal documents on behalf of the principal.
Q:
An agency relationship can be created only for a lawful purpose.
Q:
The association between one party and an agent who acts on behalf of that party is an agency relationship.
Q:
The party who has the authority to act on behalf of and bind another party is the principal.
Q:
A person who has a duty to act primarily for another person's benefit is an agent.
Q:
Agency law is primarily federal law.
Q:
In a Chapter 7 proceeding, a bankruptcy trustee may temporarily take over a debtor's business.
Q:
If a debtor fails to appear at the Chapter 7 creditors' meeting, the court may refuse to grant the bankruptcy.
Q:
Chapter 11 reorganization must be voluntary.
Q:
Before a debtor files for one specific type of bankruptcy relief, the clerk of courts must give the debtor written notice of the other types of relief available.
Q:
Under Chapter 7, liquidation may be voluntary but not involuntary.
Q:
Assets that a debtor gains after filing a Chapter 7 bankruptcy petition are generally not part of the bankruptcy estate unless they fall under an exemption.
Q:
The "bankruptcy estate" consists of the debtor's debts.
Q:
If the debtor defaults on a loan, the secured party can take possession of the collateral without any court order under the UCC.
Q:
Bankruptcy remedies are available for individuals only.
Q:
The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 included only minor changes to bankruptcy law.
Q:
If a buyer purchases chattel paper in the ordinary course of business and is unaware of any applicable security interest, the buyer can obtain the good free of any security interest.
Q:
In a dispute between a secured perfected creditor and a secured unperfected creditor, the secured unperfected creditor would be the prevailing party.
Q:
Under the UCC, a buyer in the ordinary course of business can take goods free of any security interest created by the seller of the goods even if the security interest is perfected.
Q:
A security interest may not apply to personal property that is not yet in the debtor's possession.
Q:
Proceeds are something that is exchanged for a debtor's sold collateral.
Q:
Under the UCC, the secured party's interest in the proceeds lasts 30 days after the debtor receives the proceeds.
Q:
In general, secured parties have priority over unsecured creditors.
Q:
When perfection by possession occurs, the parties do not have to create a written security agreement.
Q:
A consumer good is an item used or bought primarily for personal, family, or household purposes.
Q:
Perfection of a security interest in a motor vehicle generally occurs when the secured party files the interest with the state's Department of Motor Vehicles.
Q:
According to the UCC, value is insufficient consideration.
Q:
PMSI is purchase-money security interest, which is formed when a debtor uses borrowed money from an unsecured party to buy the collateral.
Q:
Default is failure to make payments on a loan.
Q:
Under the UCC, a secured interest is an interest in property or fixtures that secures payment or performance of an obligation.
Q:
Collateral is the property that is subject to a security interest.
Q:
The security agreement must be signed by the debtor and give an accurate and detailed description of the collateral.
Q:
Article 2(A) of the UCC governs secured transactions in personal property.
Q:
What are the two general goals of bankruptcy laws?
Q:
Set forth the first four classes of priority claims among unsecured creditors in a Chapter 7 bankruptcy case in order of priority.
Q:
A transaction in which the payment of a debt is guaranteed by personal property owned by the debtor is called a secured transaction.
Q:
Set forth the steps that a creditor must take to become a secured party.
Q:
List three advantages associated with perfection by possession.
Q:
Everett buys a new bicycle on credit from Bicycle City. Bicycle City has a security agreement for a purchase-money security interest in the bicycle but did not file a financing statement. Everett, however, discovers that he does not have enough money to pay his rent. Therefore, he sells his bicycle to his neighbor, Helen, who is unaware of Bicycle City's security interest in the bicycle. Everett fails to make payments on the bicycle and Bicycle City seeks to repossess it. Discuss the rights and obligations of the parties.
Q:
What rights, if any, does a creditor who does not wish to repossess collateral have in the event of a default, and why might a creditor prefer a remedy other than repossession of collateral?
Q:
Claims to Funds. Paul had a great job as a bank executive. Unfortunately, his bank came under scrutiny by federal regulators and while Paul had done nothing illegal, he ended up being fired. Unfortunately for Paul, he had a number of debts. Among his assets were a house worth $250,000 on which he owed $150,000 to a bank that held a security interest; three vehicles; an expensive watch worth $5,000; and $120,000 in an Individual Retirement Account "IRA". He owed $900 per month in child support to his ex-wife Suzy and was behind on payments in the amount of $1,800. He also owed $2,000 in wages consisting of four months of back pay to Bob who took care of Paul's landscaping needs and swimming pool care. Unable to find a job and believing that he had no other option, Paul filed for Chapter 7 bankruptcy. All debtors angrily demanded payment from liquidation of Paul's assets. Paul, on the other hand, claims that he needs all the above-mentioned assets and that he should not have to give up anything. Only federal bankruptcy exemptions apply to Paul's case. Which of the following is true in regard to the claims of Suzy and Bob in reference to their status as unsecured creditors? A. Suzy's claims have priority. B. Bob's claims have priority. C. Suzy and Bob are on equal footing and will receive the same percentage of funds. D. Suzy's claims have priority only up to $1,000 and after that amount is satisfied, Suzy and Bob are on equal footing and will receive the same percentage of funds. E. Bob's claims have priority only up to $1,000 and after that amount is satisfied, Suzy and Bob are on equal footing and will receive the same percentage of funds.
Q:
Overextended Debtor. Dennis purchased a big screen television from ABC Electronics and financed the purchase through ABC Electronics based on an agreement granting ABC Electronics a security interest in the television and requiring that Dennis make monthly payments. Three months later, because Dennis had bought a boat, a new car, and an expensive engagement ring for his girlfriend, and some other items, he was unable to continue making payments on the television. The manager from ABC Electronics called and asked Dennis to return the television. Dennis refused on the basis that ABC Electronics never perfected its interest in the television. Which of the following is the correct designation for the television in the agreement between Dennis and the electronic store?
A. Pledged goods.
B. Acknowledged goods.
C. Collateral.
D. Defined security.
E. Illegal security.
Q:
Repossession. Tina sold used vehicles. She sold a used pick-up truck to Joan and a used convertible to Barry. She properly obtained a security interest in both vehicles. Both Joan and Barry defaulted on payments owed to Tina for the vehicles. Tina told her assistant, Samantha that the only legal remedy was repossession; that she was going after the vehicles; and that Samantha should call law enforcement if she did not show up at the office by 10 a.m. for the next few mornings. Tina decided that she would repossess Joan's pick-up at Joan's house. Therefore, Tina slipped into the driveway at midnight one night and started the engine. Joan immediately ran out and confronted Tina. Tina shoved Joan away and drove off in the pick-up truck. Tina was able to repossess Barry's convertible in a public parking lot with no altercation with him. Which of the following is true regarding whether repossession was the only remedy available to Tina?
A. Tina was correct regardless of whether a vehicle or another type of good was involved.
B. Tina was correct, but only because a vehicle was involved.
C. Tina was incorrect, because only when a vehicle is involved, a party must disregard the collateral and proceed to judgment.
D. Tina was incorrect because regardless of whether a vehicle or another type of good was involved, Tina only had the right to ignore the collateral and proceed to judgment.
E. Tina was incorrect because regardless of whether a vehicle or another type of good was involved, Tina had the right to either take possession of the collateral or ignore rights in the collateral and proceed to judgment.
Q:
Repossession. Tina sold used vehicles. She sold a used pick-up truck to Joan and a used convertible to Barry. She properly obtained a security interest in both vehicles. Both Joan and Barry defaulted on payments owed to Tina for the vehicles. Tina told her assistant, Samantha that the only legal remedy was repossession; that she was going after the vehicles; and that Samantha should call law enforcement if she did not show up at the office by 10 a.m. for the next few mornings. Tina decided that she would repossess Joan's pick-up at Joan's house. Therefore, Tina slipped into the driveway at midnight one night and started the engine. Joan immediately ran out and confronted Tina. Tina shoved Joan away and drove off in the pick-up truck. Tina was able to repossess Barry's convertible in a public parking lot with no altercation with him. Which of the following is true regarding Tina's repossession of the pick-up truck?
A. She improperly breached the peace in recovering the collateral.
B. Tina did not breach the peace in recovering the collateral unless Joan can establish the existence of actual injuries.
C. Tina did not breach the peace because she was entitled to repossess the vehicle and any injury sustained by Joan was her own fault.
D. Tina breached the peace, but only because she did not provide Joan with prior notification that she was coming to repossess the collateral.
E. Tina breached the peace, but only because she acted to repossess the collateral after 10:00 p.m. at night.
Q:
Repossession. Tina sold used vehicles. She sold a used pick-up truck to Joan and a used convertible to Barry. She properly obtained a security interest in both vehicles. Both Joan and Barry defaulted on payments owed to Tina for the vehicles. Tina told her assistant, Samantha that the only legal remedy was repossession; that she was going after the vehicles; and that Samantha should call law enforcement if she did not show up at the office by 10 a.m. for the next few mornings. Tina decided that she would repossess Joan's pick-up at Joan's house. Therefore, Tina slipped into the driveway at midnight one night and started the engine. Joan immediately ran out and confronted Tina. Tina shoved Joan away and drove off in the pick-up truck. Tina was able to repossess Barry's convertible in a public parking lot with no altercation with him. Which of the following is true regarding Tina's taking possession of Barry's convertible?
A. Tina breached the peace because she did not provide Barry prior notification that she was going to repossess the vehicle.
B. Tina breached the peace because she took the vehicle from a public lot.
C. Tina breached the peace unless she can establish that Barry gave her prior permission to repossess the vehicle in a public lot.
D. Tina did not breach the peace because she acted in a reasonable manner in taking the collateral.
E. Tina did not breach the peace because Barry sustained no documented physical injury.
Q:
Overextended Debtor. Dennis purchased a big screen television from ABC Electronics and financed the purchase through ABC Electronics based on an agreement granting ABC Electronics a security interest in the television and requiring that Dennis make monthly payments. Three months later, because Dennis had bought a boat, a new car, and an expensive engagement ring for his girlfriend, and some other items, he was unable to continue making payments on the television. The manager from ABC Electronics called and asked Dennis to return the television. Dennis refused on the basis that ABC Electronics never perfected its interest in the television. Which of the following is the correct term for designating the effect of the failure of Dennis to continue making payments?
A. He refused the loan.
B. He defaulted on the loan.
C. He unsecured the loan.
D. He deaffirmed the loan.
E. He discharged the loan.
Q:
Overextended Debtor. Dennis purchased a big screen television from ABC Electronics and financed the purchase through ABC Electronics based on an agreement granting ABC Electronics a security interest in the television and requiring that Dennis make monthly payments. Three months later, because Dennis had bought a boat, a new car, and an expensive engagement ring for his girlfriend, and some other items, he was unable to continue making payments on the television. The manager from ABC Electronics called and asked Dennis to return the television. Dennis refused on the basis that ABC Electronics never perfected its interest in the television. Which of the following is the term for the type of agreement Dennis had with ABC Electronics?
A. A pledged money interest.
B. A collateralized interest.
C. A purchase-money security interest.
D. A security perfection interest.
E. A cash deferred security interest.
Q:
Overextended Debtor. Dennis purchased a big screen television from ABC Electronics and financed the purchase through ABC Electronics based on an agreement granting ABC Electronics a security interest in the television and requiring that Dennis make monthly payments. Three months later, because Dennis had bought a boat, a new car, and an expensive engagement ring for his girlfriend, and some other items, he was unable to continue making payments on the television. The manager from ABC Electronics called and asked Dennis to return the television. Dennis refused on the basis that ABC Electronics never perfected its interest in the television. Which of the following is correct regarding the statement of Dennis that the security interest was not perfected?
A. Dennis is wrong because the security interest perfected automatically.
B. Dennis is wrong because the security interest perfected when he was still in possession of the collateral 30 days after the purchase.
C. Dennis is wrong because the security interest perfected when he was still in possession of the collateral 60 days after the purchase.
D. Dennis is correct because in the case of luxury goods, a financing statement must be filed within 10 days.
E. Dennis is correct because regardless of whether or not a luxury good was involved, the interest was never perfected.
Q:
Overextended Debtor. Dennis purchased a big screen television from ABC Electronics and financed the purchase through ABC Electronics based on an agreement granting ABC Electronics a security interest in the television and requiring that Dennis make monthly payments. Three months later, because Dennis had bought a boat, a new car, and an expensive engagement ring for his girlfriend, and some other items, he was unable to continue making payments on the television. The manager from ABC Electronics called and asked Dennis to return the television. Dennis refused on the basis that ABC Electronics never perfected its interest in the television. Which of the following is the proper designation under the UCC for the television?
A. It is a consumer good.
B. It is a pledge.
C. It is an allonge.
D. It is unsecured property.
E. It is both unsecured and unperfected property.
Q:
Which of the following was the ruling by the U.S. Supreme Court in Rousey v. Jacoway, the case in the text involving whether funds in an Individual Retirement Account (IRA) qualify for a federal exemption in bankruptcy proceedings?
A. That funds in an IRA account are exempt from claims of creditors.
B. That funds in an IRA account are not exempt from claims of creditors.
C. That funds in an IRA account are exempt from claims of creditors only up to $5,000.
D. That funds in an IRA account are exempt from claims of creditors only up to $50,000.
E. That funds in an IRA account are exempt from claims of creditors only up to $500,000.
Q:
A. The payment was not preferential because it was for a consumer good and was not made within 30 days of the filing of the bankruptcy petition. B. The payment was preferential on the basis that it was made within 90 days of the filing of the bankruptcy petition. C. The payment was preferential on the basis that it was made within 90 days of the filing of the bankruptcy petition only if the trustee is able to establish Mindy's insolvency at the time. D. Because it was for a consumer good, the payment was not preferential unless the bankruptcy trustee can prove intent to defraud. E. The payment was preferential because it was made within two years of the filing of the bankruptcy petition.
Q:
Which of the following is true regarding the number of creditors who must vote to accept a reorganization plan under a Chapter 11 proceeding? A. For the plan to be accepted, one-third of the creditors of each class of creditors must vote to approve it. B. For the plan to be accepted, one-half of the creditors of each class of creditors must vote to approve it. C. For the plan to be accepted, two-third of the creditors of each class of creditors must vote to approve it. D. For the plan to be accepted, three-fourth of the creditors of each class of creditors must vote to approve it. E. For the plan to be accepted, one-fourth of the creditors of each class of creditors must vote to approve it.
Q:
Which of the following is false regarding Chapter 13 of the bankruptcy code? A. Chapter 13 permits individuals to pay their debts to creditors in installment plans under the supervision of the court. B. Any debtor who files under Chapter 13 could also have filed under Chapter 11. C. Chapter 13 repayment plans are usually simpler and less expensive than Chapter 11 plans. D. By statute Chapter 13 plans last between 36 and 60 months. E. Individuals, partnerships and corporations may file for a Chapter 13 repayment plan.
Q:
Which of the following was the result on appeal in In re Girolamo Afonica, the case in the text in which the debtor, without a certificate of title, transferred a vehicle securing a loan of over $11,000 to another party purportedly because the debtor's ex-wife objected to the presence of the car in the driveway?
A. That the debt was nondischargeable in bankruptcy because the debtor acted to defraud the bank.
B. That the debt was nondischargeable in bankruptcy because the debtor acted willfully and maliciously to cause injury to the collateral.
C. That the debt was nondischargeable in bankruptcy both because the debtor acted to defraud the bank and because the debtor acted willfully and maliciously to cause injury to the collateral.
D. That the debt was totally dischargeable in bankruptcy because proof of fraud was not established.
E. That because the debtor acted willfully and maliciously to cause injury to the collateral, only 50% of the debt was dischargeable.
Q:
Which of the following are nondischargeable debts under a Chapter 7 bankruptcy filing? A. Claims of willful or malicious conduct by the debtor that caused injury to another person or property. B. Specific student loans, unless payment of the loans imposes undue hardship on the debtor. C. Debts not discharged in previous bankruptcies. D. Judgments against a debtor for claims resulting from the debtor's drinking and driving. E. All of these.
Q:
Which of the following is an agreement by which the debtor agrees to pay a debt even though it could be discharged?
A. A settlement
B. A reaffirmation agreement
C. An acknowledgement agreement
D. An accord and compromise
E. An affirmance
Q:
___________________________ are not permitted to file under Chapter 11 reorganization. A. Stockbrokers B. Commodities brokers C. Banks D. Savings and loan companies E. All of these
Q:
Who calls the creditors' meeting in a Chapter 7 proceeding? A. The trustee B. The interim trustee C. The bankruptcy judge D. The district court judge E. At least three of the creditors
Q:
How is a determination made regarding the identity of the permanent trustee in a Chapter 7 proceeding? A. The bankruptcy judge appoints the trustee. B. The district court judge appoints the trustee. C. The court clerk appoints the trustee. D. The debtor appoints the trustee. E. The creditors elect the trustee.
Q:
Which type of payment does an insolvent debtor that gives preferential treatment to one creditor over another make?
A. An unfair payment
B. An unequal payment
C. A preferential payment
D. An unendorsed payment
E. An unapproved payment
Q:
A(n) ______ is a written federal court order signed by a bankruptcy judge stating that the debtor is immune from creditor actions to collect debts.
A. discharge
B. release
C. grant of immunity
D. relinquishment
E. abandonment
Q:
Which of the following means that bankruptcy relief is ordered and that the bankruptcy proceedings can continue?
A. An order of relief
B. A stay enforcement order
C. An approval order
D. A liquidation order
E. None of these because if bankruptcy relief is ordered, all collection efforts must cease
Q:
Which of the following is true regarding rights of a trustee in a Chapter 7 bankruptcy? A. The trustee takes possession of the debtor's property and has it appraised. B. If someone else holds the debtor's property, the trustee has the power to require the person to return that property. C. The trustee may temporarily take over the debtor's business. D. The trustee takes possession of the debtor's property and has it appraised; if someone else holds the debtor's property, the trustee has the power to require the person to return that property; and the trustee may temporarily take over the debtor's business. E. The trustee takes possession of the debtor's property and has it appraised; and if someone else holds the debtor's property, the trustee has the power to require the person to return that property; but the trustee may not take over the debtor's business even temporarily.
Q:
Which type of meeting is where of all creditors listed in the Chapter 7 required schedule for liquidation?A. A debt meeting B. A control meeting C. A creditors' meeting D. An enforcement meeting E. A counseling meeting