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Test 2 Flashcards

1
Q

Describe the share holder model

A

you should maximize shareholder value. who cares about doing good. The shareholders can do good with the dividends if they want

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2
Q

Describe the stakeholder model

A

the shareholders are just one of many stake holders and you should focus on maximizing value for all stakeholders including employees, customers, and community

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3
Q

Basic Approach to a land lord tenant dispute

A

don’t get mad and threaten to sue because you probably won’t follow through. DO make threats that can be realistic and inconvenient to the landlord

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4
Q

What is the TAA

A

Texas Apartment Association. Doesn’t have the force of law but can bother apt owners because they can take the logo away from their lease that is used to show fairness, and that can cause owners to lose $ b/c ppl won’t sign it

works even of owner isn’t TAA b/c sell price

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5
Q

What are the 3 kinds of leases

A

Tenancy for years, Periodic Tenancy, Tenancy at will

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6
Q

what do you need to know about Tenancy for Years

A

The lease has a specified rate and a specified term (not always a year). It is very difficult for either side to get out of. You have to be fully moved out by the last day or it can renew for the specified amount of time again.

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7
Q

What do you need to know about Periodic Tenency?

A

The specified rate is only valid of one billing cycle (month, week, etc). Either side can get out of the lease with one billing cycle’s notice

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8
Q

What do you need to know about Tenancy at Will

A

No ending date and no payment cycles. Normally formal because there is no binding relationship. Either party can bail at a moment’s notice. Avoid these

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9
Q

What are the 3 ways you can be evicted?

A

1) You violate a lease condition (“condition” or “eviction” must be in the sentence in the lease)
2) Illegal Activity
3) Legally Outrageous Act (not your average rager. The place has to be torn up a lot)

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10
Q

What are the 2 Circumstances you can be fined?

A

1) Violate a lease covenant (in lease but not specified as a condition)
2) “Negligently” (aka carelessly) cause damage. Not normal wear and tear. You have to pay for the repair

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11
Q

What is a fixture?

A

a permanently affixed improvement to the apartment.

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12
Q

If you install a fixture without the landlord’s approval/agreement, the land lord can do what 2 things?

A

1) keep it and not pay you for it
2) make you pay to restore it to original condition

moral to the story is make a written agreement

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13
Q

What are the 2 circumstances where a landlord can keep your security deposit

A

1) the lease says the deposit is not refundable
2) You negligently cause damage beyond normal ear and tear (don’t pay for normal wear or damage that was caused without negligence)

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14
Q

What is the 30 day rule?

A

Within 30 days of the end of your lease, you should either get a full refund of the security deposit or an itemized list of your damage and how much it cost to fix it + partial refund.

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15
Q

What do you do if your landlord has broken the 30 day rule?

A

You can sue for 3x your deposit in small claims court

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16
Q

What are the 2 kinds of civil lawsuits?

A

tort and contract

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17
Q

What are the 2 kinds of tort cases?

A

negligence and intentional tort cases

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18
Q

what are the 3 degrees of fault?

A

“careless”=threshold level of fault
“Reckless”=acting with extreme indifference to safety
“Intentional”=you are trying to hurt someone

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19
Q

What degrees of fault belong to which category of tort?

A

Negligence torts only meet the “careless” degree of fault

Intentional torts must meet the “reckless” and “intentional” degree of fault

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20
Q

What are the 2 kinds of damages that can be awarded in a civil case?

A

Compensatory (regular) damages= compensate you for your measurable losses including pain and suffering

Punitive Damages=awards intended to punish the defendant, jury can basically award whatever they want if they think the # needs to be high to punish.

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21
Q

What kinds of torts can be cause for punitive damages?

A

Intentional torts only (reckless or intentional degree of fault)

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22
Q

What is the definition of a tort? Standard to win?

A

any wrong that isn’t criminal or contract related

“Interest & Duty” must be present for each case the plaintiff wins (plaintiff has an interest worth legally protecting and the defendant breached a duty)

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23
Q

What is the legal concept of “Duty” in torts?

A

we have a duty to everyone that we can reasonably foresee being harmed by our negligence

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24
Q

Otis Engineering Corp V Clark

A

Otis Corp sends drunk driver on the road to kill clarks’ wives. The judge rules that even though you are normally not responsible to prevent another person from doing something, the master-servant relationship of employment makes it so that the employer has the responsibility to keep the employee from causing unreasonable risk of harm.

SC affirmed appelete court decision win favor of Clark and remanded to trial court

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25
What are the 3 main kinds of intentional torts?
Assault and Battery and Defamation
26
What is the definition of battery
"harmful or offensive" bodily contact. A battery has occurred of a REASONABLE PERSON would experience harm or offense. Some common defenses are self defense, and consent
27
What is the definition of assault
making someone afraid that they re about to be the victim of a battery. ex: flashing a gun, showing a fist Assault and battery are independent of each other
28
What is the definition of defamation?
lying about facts in ways that harm someone's reputation. You have to be communicating to someone other than the person you're trashing for it to qualify as defamation
29
What are the 3 kinds of defamation?
Slander, Libel, Slander Per Se
30
What is Slander?
A less serious kind of defamation involving spoken lies, in order to win a slander case the plaintiff has to prove Special Damages (or damages resulting directly from the slander that cost you a specific amt of $)
31
What is Libel?
a more serious kind of defamation involving written lies or any other kind of lies about a person that are permanently recorded.
32
What is Slander Per Se
Slander "on its face" is more serious and involves spoken lies about 1) Someone committing a crime 2) someone having a contageous disease 3) someone's professional ability 4) Sexual history Watchout on reference calls that you only tell the truth to nothing at all.
33
What is the additional burden a plaintiff must prove in a defamation case for a public figure?
must show malice in addition to the other requirements
34
What are the 5 burdens of proof in a negligence tort case?
1) duty of care 2) breach of duty of care 3) Cause in fact 4) Proximate cause 5) Damages
35
Describe what a duty of care is
Your duty of care is to behave like a REASONABLE PERSON and if in a professional setting, a reasonable person for that profession
36
What are the 3 kinds of guests and what kind of a duty of care do you owe to each?
1) Trespasser- must behave like a reasonable person 2) Social Guest- must behave like a reasonable person plus protect guests from known and hidden dangers 3) Business Guests- must protect them from known and unknown dangers (be proactive)
37
What are the 2 ways too prove a breach of a duty of care?
1) ordinary evidence (witness, pics, etc) | 2) negligence per se
38
What is negligence per se
This puts the defendant in a weaker position & the plaintiff in a stronger position. If the defendant broke a safety law & that led directly to an injury. Automatically proves duty of care and breach of duty of care w/o having to convince the jury of either
39
What is Cause-In-Fact
you are an essential part of a series of events that leads to the tort (the what if you didn't get out of bed test) can be indirect
40
What is a Proximate Cause?
Did you do enough to be held legally responsible? | At the time of the event that made the person a cause in fact, should they have foreseen harm?
41
What are the 2 main business torts?
Intentional interference with a business relationship and unfair competition (both intentional torts)
42
What is intentional interference with a business relationship?
a third party meddling with an existing contract (or a contract about to be signed) commits this tort
43
What is the burden of proof for an intentional interference case if there is a contract in place?
Plaintiff must prove: 1) existence of a binding contract 2) intentional act of intereference 3) Proximate cause 4) actual damage or loss was incurred * doesn't have to be malicious but the defendant must know about the contract
44
What is the burden of proof for an intentional interference case of there is NOT a contract in place?
Plaintiff must prove: 1) a reasonable probability of a future contract exists 2) intentional AND MALICIOUS act by the defendant intending to harm the plantiff 3) defendant lacked privilege or justification for interfering 4) actual damage or loss occurred
45
What is the privilege of competiton defense to a intentional interference with a business relationship case?
You have the right to compete as long as you don't use clearly improper means to get it done. protects defendants in interference cases that do not have a binding contract
46
What is the justification defense to a intentional interference with a business relationship case?
you can convince someone to break a contract with someone else asa longs as it is in that person's best interest or if it is in the public's best interest. You can also protect your own legitimate contractual or property interests
47
Sport Inc V Proserve
Preserve lures Pudge away from Sport Inc with promises of endorsements that don't end up coming true. Sport Inc sues proserve for tortious interference. District court rules against Sport Inc. Appeals judge says preserve is protected by privilege of competition b/c the contract was terminable at will. Preserve didn't compete on the basis of fraud. Appeals court affirms ruling against sport inc.
48
What is Manager's Privledge?
A manager cannot personally be sued for tortious interference b/c they participated in a sound and uncorrupted business decision to breech a contract as long as the decision was in the company's best interest
49
Unfair Competition includes
1) falsely leading customers to believe a product is endorsed by another 2) "palming off" or leading someone to buy something b/c it if falsely associated with a plantiff's brand
50
What protects your from misleading ads and disparaging another product?
State Deceptive Trade Practices Acts
51
Lanham Act
One of may acts that prohibits unfair competition
52
Section 43a of the lanham act
outlaws any false description or representation of a product. also applied to trademark infringement or trying to confuse your brand with a better brand, and making false promises of performance
53
What act prohibits commercial defamation?
part of the lanham act that prevents untrue disparagement or descriptions of a company's products and brand including false comparisons. Specifically lets news outlets and political things off the hook b/c free speech.
54
What is innocent infringement as it related to commercial defamation?
The lanham act specifically lets new outlets off the hook for unwittingly playing false advertising. This is called innocent infringement.
55
What are the 3 different ways that states handle shared blame cases?
1) contributory negligence system 2) comparative negligence system 3) pure comparative negligence system
56
What is the contributory negligence system?
a way of dealing with shared fault cases that says nobody gets anything regardless of the % of blame
57
What is the comparative negligence system?
a way of dealing with shared fault cases (as in TX) where the amount of damage incurred is multiplied buy the other person's % blame is your award. if >50% at fault, you get nothing
58
What is a pure comparative negligence system?
a way of dealing with shared fault cases where the amount of damage incurred times the other person's % blame gives you your award. NO >50% gets nothing rule
59
What are the 7 things needed for a valid contract?
1) Valid Offer 2) Accepted Offer 3) Has Consideration 4) Has Capacity 5) Assent 6) Legal Purpose 7) In Writing (sometimes)
60
Which 2 components only make a contract voidable and not totally invalid?
Capacity and Assent
61
What are the 2 common sources of contract law and how are they different?
Common law (for services) and Uniform Commercial Code (for goods)
62
What is the definition of an offer?
a proposal that counts for something. doesnt have to be written or formal
63
What is the 3 part test to determine if an offer is valid?
1) Is there a reasonably identifiable proposal 2) Is it a reasonably legitimate proposal (not $1B or 1 cent) 3) Could a reasonable person think that you could accept the offer immediately
64
What are the 3 things that can happen to an open offer?
1) it is accepted 2) it is terminated 3) it is revoked | Once one of these happens you can't go back
65
What is the essence of the Lucy V Zehmer Case?
Lucy had bothered Zehmer for a long time about buying his farm and writes down an unintentional offer on a napkin trying to embarass him. Contract found to be valid and Zehmer had to sell the farm.
66
What is a bilateral contract/offer
a bilateral contract/offer is a "promise for a promise" arrangement where both sides have to do something
67
What makes a bilateral offer accepted?
the offeree accepts the offer with a promise to do something in the future
68
What is a unilateral offer/contract?
a unilateral contract/offer is a "I'll do this if you do this" arrangement where the offeror only has to come through if the offeree delivers
69
When is a unilateral offer accepted?
the offeree accepts the offer with a performance. if the offeree does the performance the contract iss binding even if the offeree has expressed reservations
70
Precision Concepts V General Employment Personell Services
Precision Concepts hires an employee brought to them by GEPS. PC expressed reservations about the terms of GEPS commission, but hired her and that performance accepted the contract w/o a sig. Precision sued to dismiss the contract, lost and GEPS files counterclaim and wins. PC appeals and decision affirmed in favor of GEPS
71
What is an express contract?
the promises of both sides are stated explicitly either orally or in writing
72
What is an implied contract?
the promises are not explicitly stated, but must be inferred from the actions and the context ex: a request for service w/o inquiring a price expects a reasonable price
73
What is a quasi-contract?
the court ignores the fact that there is no consideration and counts the contract as valid anyway.
74
Webb V McGallon
Webb saves McGAllon's life and McGallon promises to give him half of his pension in return. McGallon fails to deliver and Webb wins the suit even thogu there was no consideration.
75
What is an important example of a quasi contract?
significant charitable donation
76
Carroll V Lee
Cohabitating couple splits after acquiring combined property and even though the ownership was never explicitly stated, the implied contract that came when the property was acquired for joint purposes is enough to get the case reversed to judy and remanded to redistribute property
77
Deskovich et al V Porzio
Michael deskovich pays his dad's medical bills under the assumption he was broke, but he was unwittingly not broke. Appellete court reverses to Deskovich b/c of a quasi contract and remands to lower court
78
Difference in a void contract and an unenforcable contract?
a void contract is usually a result of a lack of assent or capacity and an unenforcable contract is the result of some special rule like bankruptcy or statute of limitations
79
What is a contract of adhesion?
a contract prepared by a party on a take it or leave it basis (usually in the case of unequal bargaining power)
80
What is a negotiated contract?
most contracts are a result of multiple offers and counter offers
81
What is an executory contract?
any valid contract is exucutory before it has all of its obligations fulfilled
82
What are the 2 ways to get a temporarily irrevocable offer?
1) Pay some $ to keep the offer open for a set amount of time 2) under the UCC only, you can get a written promise from the business that is legally enforcable
83
What is the mailbox rule?
applicable to cases where acceptance/terminations are made in non-real time ways. Acceptances are valid when sent. Terminations are valid when received and internalized
84
What is Consideration?
the requirements for valid contracts to have a 2 way exchange of value
85
Hammer V Sidway
Uncle gets kid to stop legally drinking establishes the forbearance from doing something as one way to gain consideration
86
What are the 3 forms of consideration and how many do you need to have to have a valid contract?
1) Defendant gets a specific benefit 2) Plantiff "acts" and does anything you didnt have an existing legal duty to do 3) Plantiff "forbears" from doing anything they have a legal right to do
87
What is the peppercorn rule?
States htat you dont have to have equal valuegoing both ways to have consideration, you just ahve to ahve something
88
What is the timing rule?
whtaever event you're claiming as consideration has to happen at the same time or after the contract
89
What is the rule on consideration for renegotiated contracts regarding products?
UCC rules apply. You dont have to have new consideration
90
What is the rule on consideration for renegotiated contracts regarding services
Common Law Applies. You do have to have new consideration (remember the summer at sea work renegotiation)
91
What are some common things that cause a lack of consent?
fraud, innocent misrepresentation, mistake, duress, undue influence
92
What are the 4 things necessary things to prove fraud?
1) D misrepresented material facts 2) false statements were made with the intent to decieve 3) P reasonably relied on the bad info 4) P suffered injury as a result
93
In meeting the "Misrepresentation of material fact" portion of proving fraud. Opinions only count when there is a large difference in experience. Predictions dont coutn unless they are warranites. caveat emptor protects silence unless you have a duty to speak
belive it
94
What are the differences in fraud and warranty cases?
punitive damages are available in fraud cases. no punitive damages are available in warranty cases
95
What are the differences in fraud and warranty cases?
punitive damages are available in fraud cases. no punitive damages are available in warranty cases
96
If you have been the victim of fraud, what are your 2 options?
1) rescind the contract b/c of lack of consent | 2) keep the contract and sue for damages (inc punitive damages)
97
What is an "accord" and a "satisfaction"
you start with a reasonably disputable debt. you then write an "accord" which is a check that says paid in full. if the check is cashed, the debt is settled. but you can lack consideration if the check doesnt cover the full undisputed amount
98
What are the 3 categories of people that are usually protected with capacity arguments?
minors, mental competency, intoxication
99
What is the rule for minors who want to cancel or reverse a contract?
contract is voidable if not complete. if complete, the remaining goods rule applies and you can get a full refund. unless the minor lied about age or if the purchase is food or clothing, then the status quo rule applies
100
What is the remaining goods rule?
a person can return whatever remnants of the product remain for a full refund (relevant with minors and mentally incompentent)
101
What is the status quo rule?
a minor who lied about age or if the minor intentionally damaged the good. refunded the purchase price less the breakeven cost for the company
102
What is the level for protecting intoxicated people in capacity defenses
they have to know the "nature of the agreement" to have the legal capacity to sign a contract
103
What are the 2 main kinds of assent issues?
fraud and duress (including extremely unequal bargaining power like the mechanic holding car hostage)
104
What is the legal purpose requirement of a valid contract?
the contract can't be for illegal purposes or bad for the public good like exculpatory clauses or non compete agreements
105
What is an exculpatory clause?
a responsibility waiver. usually valid for leisure activities and not valid for nonleisure activities
106
What are the 3 factors determining the legality of a noncompete clause?
1) the length of the noncompete is <6 mo 2) the geographical area is confined to the area of operations for the company 3) specific to the kind of work you did for the old company
107
What is a security agreement?
any agreement of a debt with a certain personal property asset pledged as collateral
108
What are the 4 categoreis that have to be in writing?
lease of goods valued at more than $1K real estate insurance contracts contracts for selling investment securities
109
What are the 4 parts that must be written for a contract to satisfy the statute of frauds?
1) names of both parties 2) subject matter of the contract 3) consideration to be paid 4) anything else the court thinks is material
110
Shattuck V Klotzbach
the realestate deal that was struck via email and the email signature was considered sufficient to be valid. sometimes an autogenerated signature wont count
111
What is the parole evidence rule?
if a contract is written (even if it doesnt have to be) & is intended to be the final word, all relevant terms should be included and no outside evidence will be allowed unless that evidence clears up the ambiguous or shows fraud or a subsequent modification
112
What is the statute of Frauds?
the law that requires certain contracts to be written
113
What are the 4 kinds of contracts that have to be written according to the statute of frauds?
1) Suretyship Agreements 2) Contract that will take >1 year to complete 3) Contracts for "real Property" 4) Contracts for goods valued at over $500
114
What is the Custom Goods exception for the statute of frauds?
if the goods are custom made, the contract is binding even if it isnt written.
115
Why is the statute of frauds not as powerful as the capacity rule?
you can't undo a contract because it isnt written. You can only back out of incomplete agreements
116
difference in rejected and revoked offers
rejected=ther offeree indicated they dont want the deal | revoked= the offeror takes back the offer

Business Law (3 decks)

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