Exam 2

Question 1

1. MacPherson v. Buick Motor: Buick produced cars & sold them to dealers. MacPherson bought a car. The wheels collapsed causing an accident. MacPherson sued Buick. But there was lack of privity (relationship that exists b/w contracting parties) because Buick sold the car to the dealer & the dealer sold it to MacPherson so the contract was b/w the dealer & MacPherson.

Answer 1

Buick was found liable & this case eliminated the requirement of privity and also the first time a manufacturer was sued.

Question 2

2. How products become defective:

Answer 2

Manufacturing Defect, Failure to Warn, Design Defect, Unknown Hazards.

Question 3

3. Kim v. Toyota: Kim was involved in a car accident & suffered serious injuries. Kim sued Toyota for design defect because his truck lacked electronic stability control (ESC). The feature would have increased his chance of regaining control of his truck & not getting into the accident. Kim lost

Answer 3

The safety feature that was not on his truck was relatively new & not standard at the time on any truck. Producers should not add every possible safety feature to a product. As long as it is in the reasonable range, it’s good.

Question 4

4. Unknown Hazard:

Answer 4

dangers that were not known at the time the product was manufactured & the hazard may not be known for years so neither the producer or consumer may be able to prevent injury

Question 5

5. Joint and Several Liability (Market Share Liability):

Answer 5

): plaintiffs may sue any or all of the manufacturers of a defective product where the identity of the actual manufacturer is not clear. Plaintiff can collect from any one of the defendants or from any & all of the defendants.

Question 6

6. Defense to Product Liability Suits:

Answer 6

: Product Misuse – if it’s shown that product was misused, combined w/ another product to make it dangerous, used in an improper manner or not maintained properly, the injured party may not get recovery for damages

Question 7

7. Product Liabiltiy is based on the principle of _______

Answer 7

Strict Liability

Question 8

8. Strict Liability:

Answer 8

holding manufacturers liable to consumers injured by defective products REGARDLESS of whether the manufacturer had been negligent

Question 9

9. Ultrahazardous Activity:

Answer 9

any act that is so dangerous that the person performing can have absolute liability for injuries to other persons, even if they took every reasonable step to prevent the injury.

Question 10

10. Fraud:

Answer 10

intentional misrepresentation of material fact designed to induce the person receiving the miscommunication to rely upon it to her detriment so that a loss is suffered. Could also be defined as knowing you are telling a lie so you can enrich yourself. If there is fraud & proof that it was intentional, the party that suffered is entitled to the benefits of the fraudulent statements that were made or can sue for the difference

Question 11

11. Interference with Contractual Relations:

Answer 11

a tort in which there is a valid contract & the defendant knew of the contract but intentionally caused a breach of the contract, resulting in damages to the plaintiff. Can sue for damages.

Question 12

12. Texaco v. Pennzoil:

Answer 12

Pennzoil agreed to buy a large share of Getty Oil. Texaco, who knew of contract, offered more money for Getty & got Getty to refuse Pennzoil’s offer. Pennzoil sued Texaco for breach of contract & were awarded $10.5 billion in damages

Question 13

1. Real Property:

Answer 13

refers to land, which includes things under the land, such as oil & minerals & things attached to the land, such as buildings & trees. Can own airspace up to a thousand feet

Question 14

2. Deed:

Answer 14

primary way to transfer ownership interests (title) in property

Question 15

3. Warranty Deed (Also called General Warranty Deed):

Answer 15

): promises that the seller is conveying a good, clear title to the property. Provides the buyer the most protection. Seller or grantor warrants that the property is free of any liens or encumbrances unless they are revealed in the title. Hence, the title is warranted to be good against third parties attempting to claim title to the property (best type of deed)

Question 16

4. Special Warranty Deed:

Answer 16

not as protective as warranty deed. The grantor warrants that the buyer or grantee has received title & that property was not encumbered during the ownership by the grantor but doesn’t warrant things that may have happened prior to ownership by the grantor

Question 17

5. Quitclaim Deed:

Answer 17

a conveyance that passes whatever interests the grantor had in the property. Might not provide any assurance of good title to the property; it may only terminate the interest of the previous possessor of the property (worst type of deed)

Question 18

6. Fee Simple:

Answer 18

the right to exclusive possession of a particular piece of land for an indefinite time, as well as the right to dispose of the property as the owner pleases. Can be inherited, transferred to others or sold in part or in whole. Strongest form of real property control. Extends to the center of the earth which means ownership includes the right to minerals & oil under the land.

Question 19

7. Mineral rights under fee simple are often legally separated from ownership of the surface of the land.

Answer 19

Ex: if there is an oil well, you will get the benefits but you cannot drill the oil well.

Question 20

8. Life Estate:

Answer 20

a piece of property that gives a person the right to be a tenant for life. May be done so that a family member has the right to occupy a piece of property until, at which point the title to the property passes to someone else designated by the property owner

Question 21

9. Joint Tenancy:

Answer 21

property purchase by 2 or more persons who have the same interest in the undivided possession of property. There is a right of survivorship. Joint tenants can force an end to joint tenancy by transferring their interest into a tenancy in common.

Question 22

10. Tenancy by the entirety

Answer 22

it’s a variation of joint tenancy available only for married couples. Cannot force an end (transfer their interest) to the tenancy except by divorcing the other tenant

Question 23

11. Trust:

Answer 23

a form of property ownership that separates the legal & beneficial ownership of property. Trustee holds the legal title to the property & can make all the decisions about the property. The beneficiary of the trust gets all the benefits from the property

Question 24

12. Easement:

Answer 24

a right to enter land owned by another & make certain use of it. It’s not ownership or right of possession of an estate but a “burden” on another person’s estate. Has to be in writing

Question 25

13. Adverse Possession:

Answer 25

method by which one obtains the right to property by following specific rules under which a non-owner may be declared to be the lawful owner. Normally requires open possession of the property & restraining others from use of the property for a period of time required by state law & may require payment of property taxes. Once you get the title, you can sell it.

Question 26

14. Leases:

Answer 26

an agreement that creates a leasehold within an estate & contains conditions such as how much rent is to be paid & what restrictions have been placed on the use of the property.

Question 27

15. Rights of a Tenant:

Answer 27

has a legal interest in the rented property & has the right of possession during the term of the lease

Question 28

16. Implied Warrant of Habitability:

Answer 28

it is presumed at law that landlords protect tenants from known hazards, that the fixtures work, that the building is structurally sound & that there are not recurring problems

Question 29

17. Tresspass to Personal Property:

Answer 29

intentional & wrongful interference w/ possession of personal property w/o consent. Someone has interfered w/ the right of the owner to exclusive possession & enjoyment of personal property. Ex: you take someone’s laptop for a week w/o permission

Question 30

18. Conversion:

Answer 30

: intentional & unlawful control or appropriation of the personal property of another. Requires that the control or appropriation so seriously interferes w/ the owner’s right of control that it justifies payment for the property. Ex: you steal someone’s laptop & you do not return it

Question 31

19. Premises Liability

Answer 31

the owner of the property has a duty to keep the premises reasonably safe under the circumstances. Have a duty to inspect premises for dangers & correct the problem or warn invitees of the danger

Question 32

1. Copyright

Answer 32

rights of literary property as recognized by law. Exception for using copyrighted work is fair use which is using original material “for purposes such as criticism, comment, news reporting, teaching, scholarship, or research. It lasts the life of the author plus 70 years

Question 33

2. Trademark:

Answer 33

a commercial symbol – design, logo, phrase, distinctive mark, name, or word that a manufacturer puts on its goods so they can be readily identified in the market. Lasts 10 years, after that it must be renewed.

Question 34

3. Fanciful & Arbitrary trademarks …

Answer 34

are the most favored by the courts & get protection the fastest

Question 35

4. Fanciful:

Answer 35

made up names like Exxon & Reebok

Question 36

5. Arbitrary:

Answer 36

names not related to the product like apple for computers

Question 37

6. Suggestive Trademarks:

Answer 37

hint at the product such as Chicken of the Sea for canned tuna. More difficult to obtain legal protection

Question 38

7. Descriptive trademarks:

Answer 38

not favored by law & must be shown to have acquired customer recognition to be allowed protection. Ex: Holiday Inn for hotels & Bufferin for aspirin w/ acid buffering.

Question 39

8. Generic marks:

Answer 39

words that are common & do not refer to products from a specific producer. Ex: thermos, aspirin, escalators

Question 40

9. Trade Dress:

Answer 40

concerns the “look and feel” of products & of service establishments. Includes the size, shape, color, texture, graphics & even certain sales techniques of products

Question 41

10. Patent:

Answer 41

a grant from the government to an inventor for the “right to exclude others from making, using, offering for sale, or selling” the invention. Invention must be genuine, useful, novel, & not obvious. Lasts 20 years after filing of patent application

Question 42

11. Trade Secrets:

Answer 42

may consist of a formula, pattern, device, of compilation of info which is used in one’s business & gives him an opportunity to obtain an advantage over competitors who do not know how to use it. Information is a trade secret if it’s not known by the competition, the business would lose its advantage if the competition were to obtain it & the owner has taken reasonable steps to protect the secret from disclosure

Question 43

1. Advertising rule:

Answer 43

advertisements are invitations to make an offer to buy

Question 44

2. Bilateral Contracts:

Answer 44

when there is an exchange of promises. Ex: you say to a friend, “I will sell you my car for $2,000 and he responds, “Fine, I will pay that”

Question 45

3. Unilateral Contracts:

Answer 45

when there is an acceptance by performance. Ex: neighbor says to you, “I will pay you $30 to mow my lawn,” you say nothing in response but the next day you mow the lawn

Question 46

4. Mailbox Rule:

Answer 46

if you respond in the same way you received the offer or a faster way, it will be effective when you sent it even if the offeror doesn’t know you sent it (acceptance is effective when sent)

Question 47

5. Uncle & nephew example …

Answer 47

where the uncle promised to pay money to his nephew if he gave up drinking & partying. When the uncle died the nephew sued his estate and was owed the money his uncle promised.

Question 48

6. Promissory Estoppel:

Answer 48

when a promisee suffers a loss b/c they relied on the promise, the promisor is estopped (prevented) from denying a promise

Question 49

7. A minor is …

Answer 49

a person under the legal age of maturity. The general rule is that a minor may enter into contracts but contracts are voidable at the option of the minor

Question 50

8. Exculpatory Agreements:

Answer 50

releases one party from the consequences brought about by their wrongful acts or negligence. Ex: employment contract stating that employee will not hold employer liable for any harm caused by employer while on the job. They generally violate public policy & are not enforceable

Question 51

9. Statute of Frauds:

Answer 51

some contracts must be in writing in order to be enforced by a court in the event of a dispute. Ex: contracts for the sale of real property (land), contracts that cannot be performed within one year, promises to pay the debt of another, including the debts of an estate, & promises made in consideration of marriage

Question 52

10. Substantial Performance:

Answer 52

the contract basically has been fulfilled & payments must be made

Question 53

11. If you have a contract to buy something but the seller doesn’t want to sell…

Answer 53

you can choose b/w specific performance or damages

Question 54

12. Unconscionable Contracts

Answer 54

: when one of the parties, in a strong position, takes advantage of the other party. Stronger party convinces the other party to enter into a contract contrary to his well-being. Violate public policy & may not be enforceable. Ex: the furniture store example. Courts have the power to reform or disregard it

Question 55

1. When a contract involves both goods & services, if goods are more expensive the “UCC” will apply or if services are more expensive the “common law” will apply, or if it specifically states in the contract whether goods or service is dominant

Answer 55

.

Question 56

2. Additional terms become a part of the contract only if the offeror accepts terms by the offeree in acceptance

Answer 56

.

Question 57

3. If a buyer rejects a shipment as not conforming to the contract, the seller may ___ the defective tender or delivery if: the time for the seller’s performance under the contract has not yet passed; the seller notifies the buyer in a timely manner of an intent to cure the defect; and the seller properly repairs or replaces the defective goods within the time allowed for performance

Answer 57

cure

Question 58

4. Cover:

Answer 58

when a seller fails to deliver goods, either by being too late to be useful or b/c the goods are nonconforming, they buyer is entitled to buy substitute goods & recover the price difference. The cover price is what is paid for the substitute goods or the market price may be used to measure damages

Question 59

5. Implied Warranty of Merchantability:

Answer 59

the good “must be of a quality comparable to that generally acceptable in that line or trade (industry standards must be met). This applies to sellers who are merchants of the kind of goods in question. Also applies to packaging & labeling

Question 60

6. Warranty of No Infringement:

Answer 60

seller warrants that the supplies and the sale and/or use do not and will not infringe, misappropriate or violate any Intellectual Property Rights.

Question 61

7. Implied Warranty of Fitness:

Answer 61

buyer relies on seller’s skill or judgement in selecting goods for a particular purpose, the goods must be able to perform that purpose. The seller must know that the buyer is relying on him

Question 62

TEST QUESTION:
Abe, Bo, Cy … consist of..

A) a 1/3 … common
B) a 1/3 .. tenant
C) total ownership
D) no interest

Answer 62

A) a 1/3 … common

Question 63

TEST QUESTION:
Trade secretes of substantial...
A) D offers..
B) D's r+d ... bribes
C)
D) D conducted aerial surveillance

Answer 63

B) D’s r+d … bribes

Question 64

TEST QUESTION:
Revold manufactory..
A) Revold will loose
B) Revold will win
C) hillary will lose
D) hillary will win

Answer 64

C) hillary will lose