Business Law Text and Cases PDF

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Ed 15 - Kenneth Clarkson Roger Leroy Miller - Test Bank...

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Ch06: Tort Law True / False 1. Any time one party’s allegedly wrongful conduct causes injury to another, an action may arise under the law of torts. a. True b. Fals e ANSWER: True 2. In a tort action, a business firm can recover general damages equivalent to the actual value of damage sustained. a. True b. Fals e ANSWER: Fals e 3. In a successful tort suit, an individual is awarded compensatory damages to put him or her in a better position than the party who committed the tort. a. True b. Fals e ANSWER: Fals e 4. An award of grossly excessive punitive damages is normally available in a suit involving gross negligence. a. True b. Fals e ANSWER: Fals e 5. In most states, a plaintiff can obtain an unlimited amount of noneconomic general damages in a tort action. a. True b. Fals e ANSWER: Fals e 6. It is the motive behind the intent—not the intent—that is important in tort law. a. True b. Fals e ANSWER: Fals e 7. A defendant cannot be liable in an intentional tort action if he or she did not intend to cause harm to the plaintiff. a. True Copyright Cengage Learning. Powered by Cognero.

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Ch06: Tort Law b. Fals e ANSWER: Fals e 8. Intent can be transferred when an individual intends to harm one individual but unintentionally harms another. a. True b. Fals e ANSWER: True 9. An act intended to make another person fearful of an immediate physical harm is an assault if the threat is reasonably believable. a. True b. Fals e ANSWER: True 10. Intentional physical contact with another is not a battery unless the contact is unexcused, harmful, or offensive. a. True b. Fals e ANSWER: True 11. False imprisonment occurs only when a person justifiably restrains another. a. True b. Fals e ANSWER: Fals e 12. In most states, a merchant can use undue force to detain a person suspected of shoplifting without liability for false imprisonment. a. True b. Fals e ANSWER: Fals e 13. An employer can use his or her power and control to engage in an intentional pattern of outrageous abuse against an employee without potential tort liability. a. True b. Fals e ANSWER: Fals e Copyright Cengage Learning. Powered by Cognero.

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Ch06: Tort Law 14. A person who wrongfully hurts another’s good name or reputation orally may be liable for libel. a. True b. Fals e ANSWER: Fals e 15. A false statement about a person’s business can give rise to liability for defamation. a. True b. Fals e ANSWER: True 16. A false statement made with actual malice can constitute defamation, unless the statement is about a public figure. a. True b. Fals e ANSWER: Fals e 17. A business cannot use puffery without liability for fraudulent misrepresentation. a. True b. Fals e ANSWER: Fals e 18. Intentional deceit for personal gain may be unethical but it does not give rise to liability for fraud. a. True b. Fals e ANSWER: Fals e 19. To gain a share of a market, a businessperson can interfere in another’s business, even if the behavior is predatory. a. True b. Fals e ANSWER: Fals e 20. A person will not be liable for wrongful interference if the interference results from legitimate competitive behavior. a. True b. Fals e Copyright Cengage Learning. Powered by Cognero.

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Ch06: Tort Law ANSWER: True 21. A wrongful action that interferes with a person’s legal right to personal property can support a tort action in trespass. a. True b. Fals e ANSWER: True 22. Taking personal property from its owner, without permission or just cause, is trespass—retaining it is conversion. a. True b. Fals e ANSWER: True 23. If an owner consents to the taking of his or her property, a failure to return cannot be a tort. a. True b. Fals e ANSWER: Fals e 24. Publication of false information about another’s property is not a tort. a. True b. Fals e ANSWER: Fals e 25. An economically injurious falsehood about a business’s product can support a tort action for disparagement of property. a. True b. Fals e ANSWER: True 26. Proximate cause exists if “but for” a wrongful act, an injury would not have occurred. a. True b. Fals e ANSWER: Fals e 27. Foreseeability is the test for proximate cause. a. True b. Fals Copyright Cengage Learning. Powered by Cognero.

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Ch06: Tort Law e ANSWER: True 28. When someone suffers injury because of another’s failure to live up to a required duty of care, negligence occurs. a. True b. Fals e ANSWER: True 29. A defendant cannot be liable for negligence unless he or she intended to harm the plaintiff. a. True b. Fals e ANSWER: Fals e 30. A business firm has a duty to exercise reasonable care to protect its business invitees. a. True b. Fals e ANSWER: True 31. A landlord is expected to use reasonable care to ensure that his or her tenants are not harmed in common areas. a. True b. Fals e ANSWER: True 32. The standard of reasonable care for a professional is the same as that of an ordinary person. a. True b. Fals e ANSWER: Fals e 33. If no legally recognized injury or harm results from a given negligent act, there is nothing to compensate—in effect, no tort exists. a. True b. Fals e ANSWER: True 34. Liability for injuries based on proportionate negligence is allowed by most states. a. True b. Fals Copyright Cengage Learning. Powered by Cognero.

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Ch06: Tort Law e ANSWER: True 35. A person who enters into a risky situation, knowing the risk involved, can nevertheless recover for a resulting injury or harm for reasons of public policy. a. True b. Fals e ANSWER: Fals e Multiple Choice 36. For those who have suffered injuries as a result of the wrongful conduct of others, through tort law, society supports a. compensation. b. fines, imprisonment, and possibly death imposed on the wrongdoer. c. interference with the wrongdoer in a way not permitted by law. d. all of the choices. ANSWER: a 37. Ciera is injured when a roofing tile breaks free, falls from the roof of a building, and strikes her. If Ciera brings a successful tort action against the building’s owner, she may be awarded special damages to compensate her for a. monetary losses, such as medical expenses. b. nonmonetary aspects of the harm suffered, such as pain and suffering. c. egregious or reprehensible conduct by the defendant. d. all of the choices. ANSWER: a 38. A truck with defective brakes runs off the street and crashes into Lima’s home, damaging the property and injuring her. In a successful tort action against the truck’s owner for gross negligence, Lima may be awarded punitive damages to a. compensate for her total losses. b. put her into the same position she would have been in if the tort had not occurred. c. punish the defendant and deter others from similar wrongdoing. d. all of the choices. ANSWER: c 39. Rita brings a tort action against Santo and proves all of the elements of the claim. Santo’s successful defense will a. release the defendant from partial or full liability for the tortious act. b. impose liability on Rita for any harm to Santo arising from the suit. c. further no legitimate purpose and violate the due process clause. d. toll the statute of limitations. ANSWER: a Copyright Cengage Learning. Powered by Cognero.

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Ch06: Tort Law 40. Don interferes with the business interests of Erin in a way not permitted by law, and Erin’s business is harmed as a result. To be liable to Erin for the commission of an intentional tort, Don must have a. intended to commit the act. b. intended to harm Erin’s business. c. acted with an evil motive. d. acted with a harmful motive. ANSWER: a 41. Faro picks up an empty gas can on Gas Station’s property and throws it at Heylie, but misses and hits Izzy instead. For the tort of battery, Izzy can sue a. Gas Station. b. Heylie. c. Faro. d. no one. ANSWER: c 42. After a dinner at Rosa’s Restaurant, So believes that he was overcharged and shoves Tell, the waiter, who is injured when he falls. Tell sues So, alleging that the shove was a battery. So is liable if a. Rosario’s did not actually overcharge him. b. the shove was offensive. c. he acted out of anger. d. Rosa’s prices are too high. ANSWER: b 43. Evan is arrested for a theft committed by someone who stole his identity. A court orders his release, but due to a police error in Evan’s paperwork, he is held in jail for a month. The police are most likely liable for a. assault. b. false imprisonment. c. intentional infliction of emotional distress. d. defamation. ANSWER: b 44. Hilo tells the Internal Revenue Service that Jon “cheated on his taxes.” This can lead to Hilo’s liability for defamation if the statement is a. contemptuous . b. an opinion. c. true. d. false. ANSWER: d 45. In a phone call to Lou, Mia makes statements about Nye that injures Nye’s reputation. If Nye can prove all of the elements of defamation and Mia cannot assert a sufficient defense, Mia is most likely liable for Copyright Cengage Learning. Powered by Cognero.

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Ch06: Tort Law a. contempt. b. malice. c. libel. d. slander. ANSWER: d 46. In an online blog, Oren states that Publicity Corporation invaded the privacy of individuals to collect marketing data for its clients. If the firm can prove all of the elements of defamation and Oren cannot assert a sufficient defense, Oren is most likely liable for a. contempt. b. malice. c. libel. d. slander. ANSWER: c 47. Margo is harmed when Nell defames her. If Margo brings a successful tort action against Nell, she may be awarded general damages to compensate him for a. monetary losses, such as lost wages and benefits. b. nonmonetary aspects of the harm suffered, such as loss of reputation. c. the defendant’s reckless disregard of the effect on the life of another. d. all of the choices. ANSWER: b 48. Dylan applies for a position with Electrical Works LLC. Dylan’s previous employer, Federal Circuits Inc., gives Electrical Works a review of Dylan that includes negative statements Federal Circuits knows are untrue. This is a. defamation. b. not defamation because Dylan was employed by Federal Circuits. c. not defamation because Dylan was not employed by Electrical Works. d. not defamation because the review was not published. ANSWER: a 49. Erol works for Food Packing Company. Erol’s supervisor Gwen writes a negative review of Erol’s performance. Gwen believes the statements are true, and limits their communication to the firm’s management. In a tort action for defamation, Gwen can most likely assert as a successful defense a. none of the choices. b. malice. c. contempt. d. privilege. ANSWER: d 50. Hal posts online secretly recorded videos of Ida and includes her name, address, phone number, and Facebook page. Most likely, Ida could bring a successful tort action against Hal for a. invasion of privacy. Copyright Cengage Learning. Powered by Cognero.

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Ch06: Tort Law b. defamation. c. assault. d. appropriation. ANSWER: a 51. Pete, a broker, advises Ollie to invest in Rocky Road Inc. When the share price of Rocky’s stock decreases, Ollie accuses Pete of fraud, claiming reliance on Pete’s advice. The reliance that gives rise to liability for fraud requires a. a threat of physical force. b. a misrepresentation of fact knowing that it is false. c. puffery. d. a statement communicated to at least one person other than the plaintiff. ANSWER: b 52. Bram knows that the pipes in his building leak, but he tells Cass, a potential buyer, that there are no leaks. On this assurance, Cass buys the building. On learning the truth, she may sue Bram for a. defamation. b. conversion. c. fraudulent misrepresentation. d. wrongful interference with a business relationship. ANSWER: c 53. Fran tells Gio that her Hyundai Kia has never been in an accident. This may give rise to an action for fraud if the statement is a. puffery. b. fact. c. false. d. opinion . ANSWER: c 54. Len, a MedCo Supplies salesperson, follows Nan, a salesperson for Optima Health Products (a MedCo competitor) as she visits locations to make sales. Len solicits each of Nan’s customers. Len is most likely liable for a. conversion. b. wrongful interference with a business relationship. c. wrongful interference with a contractual relationship. d. none of the choices. ANSWER: b 55. Buddy’s Burgers advertises so effectively that the regular customers of its competitor Slimy’s Sliders patronize Buddy’s instead of Slimy’s. This is a. conversion. b. wrongful interference with a business relationship. c. wrongful interference with a contractual Copyright Cengage Learning. Powered by Cognero.

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Ch06: Tort Law relationship. d. none of the choices. ANSWER: d 56. Trespass to land is committed if, without the permission of the property owner, a person a. enters the property to assist someone in danger. b. causes water to back up onto the property. c. has a revocable license to come onto the property. d. all of the choices. ANSWER: b 57. Larry takes Kyla’s textbook and hides it so that she cannot find it during the week before the exam. In taking the textbook, Larry most likely committed a. none of the choices. b. conversion. c. appropriation. d. trespass to personal property. ANSWER: d 58. In a digital ad, Geo Treks, a retail sports equipment store, falsely accuses its competitor Headwaters of selling stolen kayaks and other gear. Headwaters’ sales decrease. Geo Treks has most likely committed a. conversion. b. none of the choices. c. slander of quality. d. slander of title. ANSWER: d 59. Fred, a clerk at a Games Store, takes a game player and a selection of games from the store without permission. Most likely, Fred is liable for a. trade libel. b. none of the choices. c. conversion. d. wrongful interference with a business relationship. ANSWER: c 60. Without Research Data Corporation’s consent, Sia hacks into the firm’s computers and downloads trade secrets and other confidential information. Most likely, Sia is liable for the tort of a. trespass to land. b. conversion. c. appropriation. d. battery. ANSWER: b Copyright Cengage Learning. Powered by Cognero.

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Ch06: Tort Law 61. Outlet Sales Store unknowingly buys goods that were stolen from Quality Products Inc. Most likely, Outlet Sales can be ordered to return the goods or pay their true owner for their value in a suit for a. none of the choices. b. conversion. c. appropriation. d. wrongful interference with a business relationship. ANSWER: b 62. Bix backs out of City Parking Garage, colliding with Dill’s car. Dill may recover $7,500 to cover the cost of the repairs if Bix failed to act as a. a blameless person. b. a faultless person. c. an objective person. d. a reasonable person. ANSWER: d 63. DIY, a retail hardware store, must use reasonable care on its premises to warn its invitees of a. all possible dangers. b. hidden dangers. c. dangers about which the business does not, or should not, know. d. no dangers. ANSWER: b 64. Ivy slips and falls on the deck of Jet’s Tour Boat and is injured. She incurs medical expenses of $500,000, and files a suit against Jet to recover. Under the “50 percent” rule, if Ivy is more than 50 percent at fault, she will recover a. nothing. b. half of the expenses. c. the amount of the expenses attributable to Jet’s fault. d. the entire amount of the expenses. ANSWER: a 65. Ricard, an engineer, supervises the construction of a new mountainside roadway. The road collapses in a landslide due to faulty grading. Motorists injured in the collapse sue Ricard in a tort action for negligence. Under that theory, as a professional, Ricard is held to the same standard of care as a. ordinary persons. b. other engineers. c. other professionals, including doctors, dentists, and lawyers. d. those injured in the collapse of the bridge. ANSWER: b 66. Cato is driving a car in which Diego is a passenger when an accident occurs. Diego is not injured. In Diego’s tort action against Cato for negligence, Cato can most likely assert as a successful defense that Copyright Cengage Learning. Powered by Cognero.

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Ch06: Tort Law a. Diego breached his duty to warn the driver of the impending accident. b. Cato did not intend to cause an accident. c. the risk of a car accident was foreseeable. d. Diego was not injured. ANSWER: d 67. Dian enters a car race, knowing that there is a risk of being injured in a crash. Dian assumes a. only those risks that she expressly agrees to assume. b. no risk in this situation. c. any risk—contemplated or not—associated with the race. d. the risk of being injured in a crash. ANSWER: d 68. Ichiro is injured in a two-car accident and sues Heather, the driver of the other vehicle, alleging negligence. Heather claims that Ichiro was driving more carelessly than she was. Comparative negligence may reduce Ichiro’s recovery a. even if Ichiro was only slightly at fault. b. only if Ichiro and Heather were equally at fault. c. only if Ichiro was less at fault than Heather. d. only if Ichiro was more at fault than Heather. ANSWER: a 69. Mick hosts an NCAA basketball championship viewing party at his home, where Neff imbibes too much alcohol. Driving drunk after the party, Neff causes an accident in which Otto is injured. Under a dram shop act imposing liability on social hosts, Otto must prove a. that Mick was negligent. b. that Neff was greater than 50 percent at fault. c. only the facts stated. d. none of the choices. ANSWER: c 70. Good Samaritan statutes were passed largely to protect, in emergency situations, a. those in need, such as individuals hurt in accidents. b. landlords and other property owners. c. physicians and medical personnel. d. business invitees. ANSWER: c Essay 71. Data Analytics, Inc., and eProducts Corporation market competing software products. Data Analytics launches an ad Copyright Cengage Learning. Powered by Cognero.

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Ch06: Tort Law campaign claiming that eProducts, instead of testing software before it is marketed, has customers “test” the software by using it. eProducts knows this is not true but begins to lose sales to Data Analytics. On what ground could eProducts sue Data Analytics for injury to eProducts’ reputation? ANSWER eProducts could sue Data Analytics for defamation for the harm it is causing to : eProducts’ reputation. Defamation occurs when a party makes a false statement that injures another’s reputation. In this problem, any defamatory statements likely take the form of libel (defamatory statements in written or printed form). To bring a suit on this ground, eProducts would have to show that Data Analytics published the false information—that is, communicated it to a third party. If eProducts is considered a public figure, it will also need to prove that Data Analytics made the statements with actual malice—that is, with either knowledge of their falsity or a reckless disregard for the truth. Publication of false information about another’s product, alleging that it is not what its seller claims, also constitutes the tort of slander of quality, or trade libel. To bring a suit on this theory successfully, eProducts would have to show not only that a third person refrained from dealing with it because of the improper publication but also that there were associated damages. eProducts might also include a claim based on the tort of misrepresentation, or fraud. Misrepresentation leads another to believe in a condition that is different from the one that actually exists. This tort requires several elements: (1) misrepresentation of facts or conditions with knowledge that they are false or w...