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Business Law > Ch10 Illegal Agreements > Flashcards

Ch10 Illegal Agreements Flashcards

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0
Q

It may consist of a private wrong, such as a tort.

A

A contract that is void does not necessarily involve a crime.

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1
Q

A contract must be for a lawful purpose;

A

otherwise it is void.

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2
Q

Contracts contrary to a public policy is void.

A

A contract that is void does not necessarily involve a crime.

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3
Q

Gambling Contracts

A

Contracts prohibited by Statute

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4
Q

Sunday contracts

A

Contracts prohibited by Statute

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5
Q

Usurious Contract

A

Contracts prohibited by Statute

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5
Q

Contracts of an unlicensed operator.

A

Contracts prohibited by Statute

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6
Q

Contracts for the sale of prohibited articles.

A

Contracts prohibited by Statute

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7
Q

Contracts in unreasonable restraint of trade.

A

Contracts prohibited by Statute

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8
Q

Administrative Agency Orders.

A

Contracts prohibited by Statute

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9
Q

Contracts Not to Compete.

A

Contracts in unreasonable restraint of trade

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10
Q

Contracts to Limit Competition

A

Contracts in unreasonable restraint of trade

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11
Q

Contracts to Fix the Resale Price.

A

Contracts in unreasonable restraint of trade

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12
Q

Unfair Competitive Practices.

A

Contracts in unreasonable restraint of trade

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13
Q

Contracts limiting freedom of marriage.

A

Contracts contrary to Public Policy

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14
Q

Contracts obstructing the administration of justice.

A

Contracts contrary to Public Policy

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16
Q

Contracts injuring the public service.

A

Contracts contrary to Public Policy

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17
Q

An agreement in which parties win or lose by chance.

A

Gambling Contract

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18
Q

Interest applied when no rate specified.

A

Legal rate

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19
Q

Highest legal rate of interest

A

Maximum Contract Rate

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20
Q

Charging higher rate of interest than law allows

A

Usury

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21
Q
  1. Some contracts can be for unlawful purposes, depending upon who negotiates them.
A

False

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22
Q
  1. A contract that is set aside because of illegality always involves the commission of a crime.
A

False

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23
Q
  1. If a contract contains both distinctively legal and illegal parts, a court can set aside the illegal part and enforce the legal part.
A

True

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24
Q
  1. Under common law, private wagering contracts were unenforceable. However, now under the UCC, most private wagering contracts are enforceable.
A

False

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25
Q
  1. Sunday contract laws are consistent within all 50 states.
A

False

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26
Q
  1. All contracts to obstruct justice are void.
A

True

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27
Q
  1. The legal rate is considerably higher than the contract rate.
A

False

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28
Q
  1. All contracts that may from their nature injure public service are void.
A

True

29
Q
  1. Discriminating in price between competing buyers when the goods are of like grade, quantity, and quality is considered unfair competitive practice.
A

True

30
Q
  1. The highest rate of interest that may be charged is called the ________ rate.
A

b. maximum contract

31
Q
  1. State laws that limit the rate of interest that may be charged for the use of money are called ________ laws.
A

d. usury

32
Q
  1. A contract not to compete:
A

c. can be valid when buying a business or making an employment contract.

33
Q
  1. Contracts to generally restrain trade are in violation of the:
A

b. Sherman Antitrust Act.

34
Q
  1. A contract that is contrary to public policy would be:
A

a. a contract to limit the freedom of marriage.

35
Q

Interest rate applied when no rate is specified. (Two words)

A

Legal Rate

36
Q

State laws that limit the rate of interest that may be charged for the use of the money are called _________ laws.

A

Usury

37
Q

The ___________ _________ ___________ attempted to eliminate certain unfair competitive practices in interstate commerce.

A

Robinson Patman Act

38
Q

This agreement between a buyer and seller that the buyer shall not resell below a stated agreement is generally considered illegal.

A

Price Fixing

39
Q

Contracts _________ to public policy are unenforceable.

A

Contrary

40
Q

Government policy encourages ____________.

A

Competition

41
Q

This is the highest rate that may be charged. (Three words)

A

Maximum Contract Rate

42
Q

This type of contract is one in which a person agrees to pay another for negotiating, procuring, or bringing about a marriage. (Two words)

A

Marriage Brokerage

43
Q

Many government administrative agencies have the __________ to issue rules and regulations; that have the force of the law.

A

Authority

44
Q

In this court case the court held that the contract was clearly a contract against public policy and therefore was __________.

A

Void

45
Q

Normally a contract not to _____________ is illegal; unless there are certain circumstances.

A

Compete

46
Q

This contract is considered illegal because of the day the contract fell on.

A

Sunday

47
Q

A transaction wherein the parties stand to win or lose based on pure chance.

A

Gambling Contract

48
Q

Contracts to use one’s ____________ in obtaining a public contract that by statute must be let to the lowest responsible bidder….

A

Influence

49
Q

There are two types of government intervention that specifically declares it illegal that such contracts that affect interstate commerce and are therefore subject to regulation by the federal government.

A

Sherman Anti-Trust Act

50
Q

If the act itself is legal, but the manner of committing the act that is called for in the contract is illegal,

A

The contract is void.

51
Q

A contract contrary to public policy is also

A

Illegal.

52
Q

If the parties are not equally guilty, courts may assist the less guilty party. However, courts will not allow a wrongdoer to enforce a contract against

A

An innocent party.

53
Q

If the contract is individual, that is, it cannot be performed except as an entity, then the illegality of one part renders the whole contract

A

Invalid.

54
Q

In general, the courts will leave the parties to a private_______ ________ where it finds them and will not allow one party to recover damages from the other for the breach of gambling debt.

A

Gambling Contract

55
Q

No state will permit the stakeholder, who is considered merely a ______ ___ ______, to keep the money.

A

Trustee of funds

56
Q

Trading on the _____ ______ or the grain market represents legitimate business transactions.

A

Stock exchange

57
Q

The violators of Sunday acts are seldom

A

Prosecuted.

58
Q

If merchandise is sold on thirty days’ credit, the seller may collect interest from the time the thirty days expire until

A

The debt is paid.

59
Q

The courts will treat transactions as ______ when there is in fact a lending of money at a usurious rate even though disguised.

A

Usurious

60
Q

The penalty for usury varies from _______ ___ ______.

A

State to state.

61
Q

In all states, special statutes govern consumer loans by…

A

Pawnbrokers, small loan companies, and finance companies.

62
Q

Loans of very large amounts of money or business loans are frequently not covered by

A

Usury laws.

63
Q

Statutes make it illegal to operate certain types of businesses or professions without

A

A license.

64
Q

The most common types of professional people who must be licensed to operate include…

A

Doctors, lawyers, certified and licensed public accountants, dentists, and insurance and real estate salespeople.

65
Q

A licensing law may be designed solely as a revenue measure by requiring payment of a fee for

A

A license.

66
Q

Contracts made by an unlicensed person operating in one of the fields or businesses covered by such a law are normally held

A

Valid.

67
Q

The unlicensed operator may still be subject to fine or ________ for violating the law.

A

Imprisonment

68
Q

In the absence of a contract prohibiting the seller from attempting to retake the _______, the seller may engage in the same business again and seek to retain former customers.

A

Goodwill

69
Q

It is customary and highly desirable when purchasing a business to include in the contract a _____ prohibiting the seller from entering the same business again in the trade territory for specified length of time.

A

Provision

70
Q

The restriction as to territory should not go beyond the _____ ____ of the business.

A

Trade area

Business Law (13 decks)

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