A holder of a _____ estate has a possessory but not an ownership interest.

A) fee simple absolute

B) life

C) conditional

D) leasehold

Answer: D

A life estate:

A) is granted only for a period of 30 years to an individual.

B) typically passes to the heirs when the life holder dies.

C) typically goes to another party, designated by the original grantor, on the occasion of the life holder's death.

D) possesses the same interest as the owner of a fee simple absolute, but the future holder cannot claim any damages from the life holder.

Answer: C

Beck, the elder son of Ted, recently claimed that he was the owner of the house where he lived with his parents (Ted and his wife) and his younger sister Lily. However, Ted claimed that he was the true owner as the property was in his name and he had not given the property to his son. Beck, however, stated that he had been living in the place for the past 28 years and has also paid taxes out of his salary and other maintenance charges to take care of the property. The scenario best exemplifies a case of:

A) bailment.

B) adverse possession.

C) condemnation.

D) mortgage.

Answer: B

Laura was riding her new motorbike in a residential area. She had to swerve suddenly to avoid hitting a small child who had run onto the street after a ball. As a result, Laura hit a tree and fractured three ribs and her right arm. The motorbike also sustained considerable damage. Laura sued the father of the child who was present at the scene of the accident for negligence, but in court the defense argued that Laura had exceeded the speed limit. Which defenses to negligence has been used here by the defendant?

A) Negligence per se

B) Contributory negligence

C) Assumption of the risk

D) Superseding cause

Answer: B

Ian, a door-to-door salesman, filed a negligence case against Mark. While ringing the doorbell on Mark's front porch, he was bitten by a venomous snake that Mark kept as a pet. Ian had no previous warning of the snake being loose. In this scenario, Ian is most likely to have filed for damages under _____.

A) intentional tort

B) strict liability

C) negligence per se

D) last-clear-chance doctrine

Answer: B

To establish proximate cause in a negligence claim, it is necessary to prove that the:

A) damages or losses suffered by a plaintiff were above $5 million.

B) plaintiff would have suffered losses even if the defendant had fulfilled his or her duty of care.

C) defendant's actions were intended to cause injury to the plaintiff.

D) defendant could reasonably foresee the damages that the plaintiff suffered as a result of his or her action.

Answer: D

To win a negligence case after it has been established that the defendant owes a duty to the plaintiff, it must be proved that the:

A) defendant intended to cause injury.

B) defendant failed to live up to the standard of care.

C) plaintiff suffered damages above $5 million.

D) plaintiff could not avoid the situation.

Answer: B

What is the outcome if a defendant successfully proves contributory negligence?

A) The plaintiff will be denied any recovery of damages.

B) The defendant has to pay for half the damages incurred by the plaintiff.

C) The plaintiff and the defendant will be incarcerated for three months.

D) The plaintiff will pay a sum to the defendant for filing a case.

Answer: A

A contract entered into by a person suffering from mental problems yet who still understands the nature of the contract and the obligations it imposes is considered ________.

Answer: Valid

When is a contract voidable?

A) When the contract is entered into by a minor

B) When the contract is entered into by a person adjudicated insane

C) When the contract is entered into by a person adjudicated as a habitual drunkard

D) When the contract is entered into by an intoxicated person who understands his or her contractual obligations

Answer: A

Which of the following elements of a contract refers to the mental ability of a person to understand his or her rights and obligations under a contract and comply with the terms? 

A) Fair consideration

B) Recognizance

C) Legal capacity

D) Agreement

Answer: C

In a contract made by a minor, the: 

A) minor has the right to disaffirm the contract before or within a reasonable time of reaching the age of majority

B) minor can choose to disaffirm only a portion of the contract

C) other party will have no recourse against the minor in any state if the consideration has been damaged or destroyed

D) adult parties to the contract can disaffirm the contract

Answer: A

When there is no dispute over the amount of debt or existence of debt, it is referred to as a _____.

Answer: Liquidated debt

In a liquidated debt, ________.

A) the parties in a contract come to a settlement by entering into an accord and satisfaction

B) the debtor and the creditor disagree about the amount of money owed

C) once the debtor provides a different, agree, performance, the debt is satisfied and the creditor may not collect anything else

D) if the debtor pays the money agreed to, the creditor cannot sue for the balance it believes is owed

Answer: C

Maya pays $5,000 and purchases a car from her friend, Jane. Later, Maya realizes that the car is worth less than $3,000. Which of the following statements will be true if Maya plans to sue her friend? 

A) The court will hold Jane liable as she made an illusory promise

B) Jane will be held guilty because her action is a breach of promissory estoppel

C) Maya cannot sue Jane because the court seldom considers adequacy of consideration

D) The court will hold the contract to be invalid as it involves falsification of data

Answer: C

Kevin is offered a job by a reputed company in a different city. To take up the new job, Kevin quits his previous job and moves to the new city along with his family. When he shows up at work, he is told that there is no job. Kevin can sue the employer under the theory of ________.

Answer: Promissory Estoppel

If a party to a contract asks for an additional amount of money and agrees to do more work than the contract requires, the result is that the promise:

A) Becomes an option contract

B) to do the extra work is an illusory promise

C) to do the extra work is valid consideration

D) becomes a part of the party's preexisting duty

Answer: C

Lucas is planning to buy a house owned by Janet. He gives her an initial amount of $10,000 to hold the offer open for a 45-day period. Janet will deduct the $10,000 from the purchase price if Lucas purchases the property within those 45 days. If he does not, Janet can keep the $10,000 and offer the house to another party. Which of the following contracts does this scenario best illustrate?

Answer: Option contract

Felipe, Adam, and Shirley are neighbors. Felipe overhears Adam's offer to sell an antique clock to Shirley for $3,000. Under these circumstances, _____.

A) Shirley cannot make a counteroffer to Adam to buy the clock for $2,500

B) Felipe makes a new offer to Adam when he offers to buy the clock for $3,000

C) Felipe accepts the original offer made to Shirley when he accepts to buy the clock from Adam for $3,000

D) Adam cannot make a new offer to sell the clock for $3,500 to Felipe

Answer: B

Jason agrees to buy Sara's car for $10,000. However, Sara tells Jason that she will only sell the car to him if he pays $12,000. In this scenario, Sara makes a(n):

Answer: Counteroffer