Business Law II Final Exam
Spring, 2010 at Medgar Evers College
Bisk problems based on West’s Business Law Business Structure Material
1. In a general partnership, which of the following acts must be approved by all the partners?
a. Dissolution of the partnership
b. Admission of a partner
c. Authorization of a partnership capital expenditure
d. Conveyance of real property owned by the partnership
2. Which of the following statements is correct regarding the division of profits in a general partnership when the written partnership agreement only provides that losses be divided equally among the partners? Profits are to be divided:
a. Based on the partners’ ratio of contribution to the partnership
b. Based on the partners’ participation in day to day management
c. Equally among the partners
d. Proportionately among the partners
3. Price owns 2,000 shares of Universal Corp’s $10 cumulative preferred stock. During its first year of operations, cash dividends of $5 per share were declared on the preferred stock but were never paid. In the second year, dividends on the preferred stock were neither declared nor paid. If Universal is dissolved, which of the following statements is correct?
a. Universal will be liable to Price as an unsecured creditor for $10,000.
b. Universal will be liable to Price as a secured creditor for $20,000.
c. Price will have priority over the claims of Universal’s bond owners.
d. Price will have priority over the claims of Universal’s unsecured judgment creditors.
4. Under the Revised Model Business Corporation Act, which of the following statements is correct regarding corporate officers of a public corporation?
a. An officer may not simultaneously serve as a director.
b. A corporation may be authorized to indemnify its officers for liability incurred in a suit by stockholders.
c. Stockholders always have the right to elect a corporation’s officers.
d. An officer of a corporation is required to own at least one share of the corporation’s stock.
5. Which of the following statements is a general requirement for the merger of two corporations?
a. The merger plan must be approved unanimously by the stockholders of both corporations.
b. The merger plan must be approved unanimously by the boards of both corporations.
c. The absorbed corporation must amend its articles of incorporation.
d. The stockholders of both corporations must be given due notice of a special meeting, including a copy or summary of the merger plan.
6. Food Corp. owned a restaurant called The Ambers. The corporation president, T.J. Jones, hired a contractor to make repairs at the restaurant, signing the contract, “T.J. Jones for The Ambers.” Two invoices for restaurant repairs were paid by Food Corp. with corporate checks. Upon presenting the final invoice, the contractor was told that it would not be paid. The contractor sued Food Corp. Which of the following statements is correct regarding the liability of Food Corp.?
a. It is not liable because Jones is liable.
b. It is not liable because the corporation was an undisclosed principal.
c. It is liable because Jones is not liable.
d. It is liable because Jones had authority to make the contract.
Questions 7 and 8 –
The following are pairs of moot court cases and concepts from this semester. Pick at least two of the following pairs and a) identify the facts of the case; b) identify the term and how the term made a difference in the case; and c) identify how you would have resolved each case.
Case / ConceptNational Franchise Association v. Burger King, Inc. / Section 2 of the Sherman Antitrust Act
Merck v. Reynolds / Section 10(b) of the Securities Exchange Act of 1934
City of Ontario v. Quon / Privacy under the Fourth Amendment Search and Seizures Clause
Omega v. Costco / The First Sale Doctrine of the U.S. Copyright Act
Answer the following two questions by applying Business Law II concepts and using the CIRAC format – [Conclusion; Issue; Rule; Application; Conclusion]:
9. In the early 1980s, D’Amato, acting as agent for the young Mike Tyson, agreed with Rooney that Rooney would be Tyson’s trainer “for as long as [Tyson fights] professionally.” The parties also agreed that Rooney would receive 10 percent of Tyson’s boxing earnings. In 1986, Tyson orally reaffirmed the agreement, stating that Rooney “will be Mike Tyson’s trainer as long as Mike Tyson is a professional fighter.” In 1988, apparently in connection with Rooney’s alleged comments about Tyson’s divorce and other business litigation, Tyson formally terminated his boxer-trainer relationship with Rooney. In 1989, Rooney sued Tyson for breach of contract in federal district court. Should the doctrine of employment-at-will apply to this oral contract “for as long as the boxer fights professionally?” (Business Law: The Ethical, Global, and E-Commerce Environment, 14th Ed., Mallor, Barnes, Bowers, and Langvardt, p. 1342)
10. Discuss fully whether either of the following actions would constitute a violation of Title VII of the 1964 Civil Rights Act, as amended: a) Tennington, Inc. is a consulting firm and has ten employees. These employees travel on consulting jobs in seven states. Tennington has an employment record of hiring only white males.
b) Novo Films is making a movie about Sweden and needs to employ approximately one hundred extras for this picture. Novo advertises in all major newspapers in New York for the hiring of these extras. The ad states that only Caucasians need apply. (based on West’s Business Law, 11th ed.)
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