Buisness Law Only Flashcards
What is Agency Law?
Agency Law deals with someone’s ability to bind you to a contract with a third party
What are the basic actions that occur in a bankruptcy?
Bankruptcy gives creditors protection from their creditors and stops them from either permanently (Chapter 7) or temporarily (Chapter 11 or 13) collecting a debt Filing halts collection activity; grants “automatic stay” (with certain exceptions) Stops creditors from suing debtor
What are the key elements of a valid Partnership?
Must have two or more partners. Must intend to engage in business for profit. Life of partnership is of limited duration in most cases. Agency/fiduciary relationship is created. Partnership interest is always considered personal property.
What is a promissory note?
A promise to pay a specific amount Two parties involved - maker and a payee Can reference other transactions without harming the instrument’s negotiability Example: Bank Certificate of Deposit (CD)
What must a contract contain?
Offer Acceptance Consideration (something of value) Proper form (oral or written) Legal subject matter Two or more competent parties
What is considered the biggest change to financial regulation since the Great Depression of the 1930s?
The Dodd-Frank Wall Street Reform Act of 2010
Describe the Federal Unemployment Tax Act
An employer-paid tax Must file return and pay even if only one employee works there Deductible to company - Not deductible by the employee Allows employers to credit the FUTA liability by the amount of State Unemployment Tax (SUTA) they pay
What are the key points of the 1933 Securities Act?
Governs Initial Public Offerings (not subsequent sales). Covers registration statements and accompanying information filed with SEC Information must include audited financial statements & a prospectus Note: Even if a company is exempt from registering under the 1934 Act; they still must adhere to the anti-fraud provisions of the Act
What is the purpose of a Consulting Engagement?
This engagement helps the client be more efficient with personnel and resources in order to accomplish their goals.
What does Real Property include?
Land; buildings fixed to the land; property under the land and above the land
What sales are covered under the Uniform Commercial Code (UCC)?
Only sales of goods are covered under the UCC.
When does a security interest attach; or become legally enforceable?
Secured interest must be supported by consideration given Debtor must actually own the rights to the collateral or have possession Secured interest much be recorded
What is required for Agency to exist?
Both parties must consent to the relationship and intend for an Agency relationship to exist Agent owes Principal fiduciary duty Principal doesn’t owe Agent fiduciary duty A contract is NOT required and an Agency agreement is not based on Contract Law; Exception – If duties cannot be performed within a year; a signed writing is required
For what debts does bankruptcy NOT stop collections?
Student Loans Income taxes from previous 3 years Alimony & Child Support Debts/judgements resulting from drunk driving Pension obligations Debts relating to SOX violations Debts arising from illegal activities Debts not listed in the bankruptcy filing
Can corporations and other partnerships become partners in a partnership?
Yes; corporations and other partnerships can become partners of a partnership
What is a draft?
A commercial paper involving three parties- a drawer; a payee and a drawee A drawer orders a sum to be paid to a payee by the drawee May be payable on demand or in the future
What forms may acceptance of a contract take?
Can be written or oral Must be in the form/method required by offeror Must be mirror image - i.e. no changes in terms
What is the goal of the Volcker Rule?
Banking Institutions maintain healthy capitalization ratios
What are the major aspects of FICA and Social Security taxes?
Paid by Employer AND Employee - Employer withholds from employee’s paycheck and must pay tax matching employee’s withholding If employer under-withholds; they are required to make up the difference Self-employed individuals must pay both the employer and the employee share; which is “Self Employment Tax” People drawing Social Security may have their benefits reduced if they go back to work and earn an income
What entities are exempt from filing registration statements under the 1933 Securities Act?
Banks; Commercial Paper; Farmers; Co-ops; Charities; Governments Also exempt: Securities sold in ONE state; where investors are residents; 80% of business done in one state; and resales can’t occur within 9 months to interstate parties.
What is required by the Statements on Standards for Consulting Services (SSCS)?
Competence; Due Professional Care; Planning; Supervision; Obtain Sufficient Data; Serve Client Interest; Agreement: Written or Oral; Communicate w/ Client; Objectivity NOT REQUIRED: Independence
What are the characteristics of a deed?
Must be in writing Signed Description of Property Delivered Recorded
What elements are needed for a sale covered under the Uniform Commercial Code (UCC)?
Offer - You offer to sell something at a price Acceptance - the other party accepts Consideration - Something of value has been exchanged for the goods Note: The UCC only covers sales of goods.
What are the characteristics of perfection of interest in a secured transaction?
Gets higher priority over others claiming rights to collateral after the perfection takes place Attachment must take place BEFORE perfection