Bankruptcy and Corporation Law Quiz

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Questions and Answers

Which characteristic is NOT typically associated with a corporation?

Limited liability of shareholders

Double taxation on income

Personal liability for corporate debts (correct)

Perpetual existence

What is the primary focus when filing for Chapter 7 bankruptcy?

Liquidation of assets to pay creditors (correct)

Credit counseling sessions before filing

Repayment of debts over three to five years

Restricting income for five years

Which stage comes directly after filing the bankruptcy petition?

Discharge in Bankruptcy

Meeting of Creditors (correct)

Proof of Claim

Prepetition Counseling

What right does a creditor have in secured credit after a default?

Repossession of the collateral Signup and view all the answers

During Chapter 13 bankruptcy, which of the following is true regarding the payment plan?

It allows for flexible repayment over three to five years. Signup and view all the answers

Which of the following debts typically cannot be discharged in bankruptcy?

Student loans Signup and view all the answers

What best describes the limited liability of shareholders?

Shareholders can lose their investment but are not liable for corporate liabilities. Signup and view all the answers

The role of the bankruptcy trustee includes which of the following?

Manage the debtor's estate and ensure fair distribution of assets. Signup and view all the answers

What is required for a class action lawsuit to be certified?

The legal and factual claims must be common among plaintiffs. Signup and view all the answers

What does a default judgment establish?

The defendant's liability. Signup and view all the answers

Which of the following powers is NOT an enumerated power of Congress?

Appoint Supreme Court justices. Signup and view all the answers

Which concept aims to prevent any one branch of government from becoming too powerful?

Checks and balances. Signup and view all the answers

What must the government provide when it takes private property for public use?

Just compensation. Signup and view all the answers

In arbitration, what is the characteristic of the majority of cases?

They are often binding. Signup and view all the answers

Which of the following statements about the Necessary and Proper Clause is true?

It allows Congress to create powers outside of those enumerated. Signup and view all the answers

What is a primary requirement for a claim to be typical among plaintiffs in a class action lawsuit?

The claims must arise from the same event or practice. Signup and view all the answers

What characterizes an option contract?

It includes a promise to keep an offer open for a specific period in exchange for consideration. Signup and view all the answers

Which of the following statements about acceptance is true under the mirror image rule?

Acceptance must mirror the terms of the offer exactly. Signup and view all the answers

What are compensatory damages designed to provide?

Benefit of the bargain, intending to cover the actual losses incurred. Signup and view all the answers

In which situation would specific performance likely be granted as an equitable remedy?

When the item in question is unique and cannot be easily substituted. Signup and view all the answers

Which of the following is a characteristic of unsecured credit?

It does not have any collateral backing. Signup and view all the answers

Which type of damages is awarded if a contract has been breached but no actual financial loss has occurred?

Nominal damages. Signup and view all the answers

When can silence be considered acceptance in a contract?

It may be accepted if the offeror specifies that silence implies acceptance. Signup and view all the answers

What best describes consequential damages?

They must be foreseeable losses resulting from a breach. Signup and view all the answers

Study Notes

General Study Tips

Case names reviewed in class are on the slides.
Review book examples related to each tested objective for each chapter.
Pre-test questions are not exhaustive; focus on exam objectives.
Bolded terms are defined in the textbook.
Material not included in the review objectives is not on the exam.
Material with a line through it should not be studied.

Legal Heritage and the Information Age

Three questions on this topic
Two questions on identifying different types of laws (Constitution, treaties, statutes, administrative law, regulations, executive orders, judicial decisions, common law).
One question on understanding the hierarchy of law.

Judicial, Alternative, and E-Dispute Resolution

Define complaint, summons, and answer, and the pleading process.
Complaint: document plaintiff files to initiate a lawsuit.
Summons: court order directing defendant to appear in court and answer the complaint.
Service of Process: complaint and summons are served on defendant.
Answer: defendant's response, includes denials of facts and defenses.
Review the Statute of Limitations.
Failure to answer results in a default judgment.

Judicial, Alternative, and E-Dispute Resolution - Class Action

Understand the process of certifying a class-action lawsuit.
The legal and factual claims must be common.
Commonality among plaintiffs and impracticability of individual claims.
Claims/defenses must be typical for plaintiffs/defendants.
Representative parties must protect the class's interests adequately.

Judicial, Alternative, and E-Dispute Resolution - Alternative Dispute Resolution (ADR)

Focus on arbitration.
Most arbitration is binding.

Constitutional Law for Business and E-Commerce

Understand enumerated powers, federalism, and checks and balances.
Know Congressional powers (Article 1, Section 8).
Understand the necessary and proper clause.
Differentiate between legislative, executive, and judicial branch powers.

Constitutional Law for Business and E-Commerce - Taking Private Property

The government can take private property for a public purpose but must provide fair compensation.

Criminal Law and Cybercrime - White Collar Crimes

Recognize crimes from the Student Power Points.
Identify the best crime to charge based on fact patterns.
Use the PowerPoint in Blackboard.

Intentional Torts and Negligence

Focus on proximate cause.
Explain the elements necessary to prove negligence (objective 2).

Intentional Torts and Negligence - Comparative Negligence

Understand comparative negligence and calculate reduction in damage awards.
Do not study contributory negligence or partial comparative negligence.

Administrative Law and Regulatory Agencies - Cabinet-Level Departments

Understand how cabinet-level departments operate and who they answer to.
Do not memorize all cabinet-level departments.

Administrative Law and Regulatory Agencies - Administrative Powers

Understand the delegation doctrine and when an agency is granted executive power.
Agencies must obey the Bill of Rights (especially the Fourth Amendment).
Understand "reasonable" investigations/searches by agencies, and the consequences of "unreasonable" actions.

Administrative Law and Regulatory Agencies - Individual Rights and Disclosure

Congress created laws to monitor agency actions.
Understand the Freedom of Information Act (FOIA), Government in the Sunshine Act, Equal Access to Justice Act, and Privacy Act.

Antitrust Law and Unfair Trade Practices - Restraints of Trade

Section 1 of the Sherman Antitrust Act prohibits collusion or restraining trade.
Unilateral activity may be legal, e.g., refusal to deal.
Collective action petitioning the government is generally legal.
Understand instances of horizontal restraints of trade.
Price fixing
Division of markets
Group boycotts
Vertical restraints of trade (e.g., resale price maintenance).

Antitrust Law and Unfair Trade Practices - Monopolization

Explain the three elements of a monopolization lawsuit.
Relevant market (product and geographic).
Monopoly power.
Willful act of monopolizing
Explain defenses to monopolization lawsuits (when monopoly power is legal).

Intellectual Property and Information Technology - Intellectual Property

State and federal laws protect these four types of intellectual property:
Trade secrets
Patents
Copyrights
Trademarks

Intellectual Property and Information Technology - Copyright

Define copyright, examples, and duration.
Copyright registration is required to sue under federal law.
Know copyright remedies.
Know the Fair Use Doctrine (purpose of use, nature of work, amount of copying, and impact on the market).

Intellectual Property and Information Technology - Patent

Requirements for obtaining a patent: novel, useful, non-obvious.
Utility patent duration = 20 years, design patent = 14 years.
Patent grants legal monopoly, and patent holders can sue infringers.

Intellectual Property and Information Technology - Trademark

Define types of marks (distinctive (e.g., fanciful, arbitrary), secondary meaning)
Federal registration is required or in certain situations of non-ordinary usage.
Explain duration of a mark and mark loss.

Nature of Traditional and E-Contracts

Categorize contracts as formal or informal, valid or void, voidable, or unenforceable, executed or executory, and express or implied.
Understand unilateral contracts versus bilateral contracts.

Nature of Traditional and E-Contracts - Terminating Offers

Know the different ways a party's actions can terminate an offer (revocation, rejection, counteroffer).
Understand option contracts and their requirement of consideration.
Distinguish between termination by a party's action and termination by operation of law.

Nature of Traditional and E-Contracts - Acceptance

Know the requirements for acceptance (unequivocal).
Understand when silence can be acceptance.
Know the rules for time of acceptance and mode of acceptance.

Breach of Contract

Compensatory damages (know the purpose).
"Benefit of the bargain".
Do not worry about construction or employment contracts, consequential damages (must be foreseeable), and disclaimers of consequential damages
Understand nominal and liquidated damages.

Breach of Contract - Equitable Remedies

Focus on specific performance and injunction (remember courts prefer monetary damages).

Credit, Real Property Financing, and Debtor's Rights

Define unsecured credit.
It does not require collateral
Be able to identify types of unsecured debt (e.g., student loans, utility bills, credit cards).

Credit, Real Property Financing, and Debtor's Rights - Secured Credit

Understand Collateral, secured credit, the right to repossess, and deficiency judgment.

Bankruptcy

Know the order of bankruptcy proceedings (prepetition counseling, file petition, order for relief, meeting of creditors, proof of claim, and discharge).
Understand the bankruptcy trustee's role.
Know debts that cannot be discharged.

Bankruptcy - Chapter 7

Know the difference between chapter 7 and chapter 13 bankruptcy.
Understand the provisions of a chapter 7 liquidation bankruptcy.
Median Income Test.
Do not focus on statutory distribution of property.

Bankruptcy - Chapter 13

Understand the process for filing for chapter 13, including the chapter 13 plan of payment.

Corporate Formation and Financing - Corporations

Define a corporation, list its characteristics, and know the roles of shareholders, the board of directors, and corporate officers.
Know the limited liability of shareholders.
Know how to identify, define and compare the different types of corporations (i.e., corporations for profit, publicly held, closely held, government-held, not for profit, domestic, foreign, alien, holding companies).

Corporate Formation and Financing - Incorporation

Describe the process of incorporating and forming a corporation, including the registered agent.

Corporate Formation and Financing - Equity Financing

Know the differences between common and preferred stock.
Do not study re-deemable preferred stock, electronic registration, authorized shares, issued shares and outstanding shares.

Corporate Formation and Financing - Debt Financing

Describe how a corporation is financed by debt securities (e.g., debentures, bonds, notes).

Corporate Formation and Financing - Dissolution

Describe how a corporation is dissolved and terminated.
Know the differences between voluntary dissolution, administrative dissolution, and judicial dissolution.

Corporate Formation and Financing - Partnerships

Define partnership, agreement, profit, and persons
owners are called partners
Differentiate between general and limited liability for partnership debts.

Liability of Principals, Agents, and Independent Contractors - Agent's Duty of Loyalty

Know the agent's duty of loyalty.
Identify different duties of loyalty (including examples of self-dealing and usurp opportunity).

Liability of Principals, Agents, and Independent Contractors - Tort Liability

Agents are liable for their own torts.
Principals may be liable for an agent's torts if they are in the scope of employment.
Apply the "motivation test" and "work-related" test when determining principal liability.

Liability of Principals, Agents, and Independent Contractors - Principal liability for third-party contracts

Understand a disclosed, a partially disclosed, and an undisclosed principal's liability to third parties.
Understand contract ratification.

Liability of Principals, Agents, and Independent Contractors - Independent Contractors

Understand what constitutes an independent contractor.
Principal liability for independent contractor's torts and contracts.

Employment, Worker Protection, and Immigration Law

Define an "at-will" employee and related exceptions.
Wrongful discharge and cause termination.

Employment, Worker Protection, and Immigration Law - Workers' Compensation

When employees qualify for workers compensation.
The exclusive remedy against the employer (not third parties causing injury).

Employment, Worker Protection, and Immigration Law - Occupational Safety and Health Act

Employer's duty to provide safe working conditions, including OSHA.

Employment, Worker Protection, and Immigration Law - Fair Labor Standards Act

Child labor regulations
Federal minimum wage and any higher local rates
Overtime pay and calculation methods
Nonexempt employees and overtime pay
Know blue-collar and first responder workers are also eligible for overtime compensation.

Employment, Worker Protection, and Immigration Law - Family and Medical Leave Act (FMLA)

Know when an employee qualifies for FMLA.
Know what rights FMLA provides.

Employment, Worker Protection, and Immigration Law - Unemployment Compensation

Know what unemployment compensation is.
The requirements for unemployment compensation.

Under the Federal Insurance Contributions Act (FICA), both employees and employers contribute.

Employment, Worker Protection, and Immigration Law - Employment Eligibility Verification

Employer responsibilities in verifying employee eligibility.
Understand foreign guest worker visa (H-1B)

Equal Opportunity in Employment - Equal Employment Opportunity Commission (EEOC)

The EEOC's function, including the complaint process.
Understand The Lilly Ledbetter Fair Pay Act and potential back pay awards.

Equal Opportunity in Employment - Civil Rights Act of 1964 (Title VII)

Classes covered by Title VII (race, color, national origin, sex, religion).
Scope of coverage.
Understand disparate treatment and disparate impact discrimination.

Equal Opportunity in Employment - Race and Color Discrimination

Differentiate between race and color discrimination (Do not study racial classification descriptions).

Equal Opportunity in Employment - National Origin Discrimination

Understanding national origin.
Discrimination prohibited by the Civil Rights Act of 1964.

Equal Opportunity in Employment - Gender Discrimination

Differentiate between quid pro quo and sex plus discrimination (Do not study pregnancy discrimination).

Equal Opportunity in Employment - LGBTQ+ Protections

Understand sexual orientation and gender identity.
Prohibitions against discrimination based on these factors.

Equal Opportunity in Employment - Harassment

Harassment and hostile work environment
Do not address affirmative defenses and classification of harassers.
Types of Harassment

Equal Opportunity in Employment - Religious Accommodation

Understand when employers must accommodate employees' religious practices.

Equal Opportunity in Employment - Employer Defenses

Know the Bona Fide Occupation Qualification (BFOQ) defense.

Equal Opportunity in Employment - Americans with Disabilities Act (ADA)

Understand the protections afforded by the ADA.
Employer responsibilities for reasonable accommodation.
Understanding undue hardship.

Equal Opportunity in Employment - Uniformed Services Employment and Reemployment Rights Act (USERRA)

Protect veterans and military personnel.
Understand what USERRA protects.

Equal Opportunity in Employment - Affirmative Action

Understand affirmative action and affirmative action plans.
Do not study reverse discrimination.

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Description

Test your knowledge on bankruptcy laws, corporate characteristics, and the roles of creditors and trustees in financial procedures. This quiz covers essential concepts related to corporate law, bankruptcy mechanisms, and legal rights that come into play during these processes.