1. What is an “inter-vivos gift”?
a. A gift from a brother to a sister
b. A gift from one living person to another living person
c. A gift from a person who is in contemplation of imminent death
d. A gift from a person who has just died

2. Wanda borrows $2,000 from her friend Jack, and signs a Promissory Note in which she agrees to pay Jack $100.00 per month until the debt is paid back (along with 10% interest on the unpaid balance). Wanda makes two payments as agreed, then makes no further payments. After repeated efforts to collect the money from Wanda, Jack finds out that Wanda has died! What can Jack do to try to collect on his loan?
a. Jack is out of luck! Once a person dies, there is no longer any debt owed to creditors. This is the ultimate “debt-forgiveness” situation!
b. Jack can go to court to have the judge force Wanda’s family (children, parents, etc.) to pay Wanda’s debts – including Jack’s loan.
c. Jack’s only option is to beg Wanda’s family to pay, because they have no legal obligation to pay Wanda’s personal debts.
d. Jack can file a claim against Wanda’s estate, with a copy of the unpaid Promissory Note as evidence of Wanda’s debt to Jack, in probate court, and hope that she left enough assets to pay for all of her debts (including Jack’s loan).

3. Attorneys are called “officers of the court” because they owe duties to the court system, as well as duties to their clients. Carmen retired from her former corporate employer several years ago. Before retiring, Carmen had embezzled about $1 million from her employer, although the company has never discovered the theft. The state statute of limitations for this criminal behavior has now expired, so Carmen could not be charged with the crime even if the company found out and turned over the information to the government and asked them to go after Carmen. Carmen (feeling guilty) decides she has to tell someone, so she talks to her attorney, Nellie, and also confesses the theft to her priest at the local church.
You may want to look at Rule 1.6 of the Rules of Professional Conduct for Attorneys.
a. Nellie must tell the court, or the local prosecuting attorney, about Carmen’s embezzlement.
b. Nellie has no professional legal obligation to reveal this confidential confession from Carmen, to anyone.

4. Assume the same facts as in Question 3, only this time, the state statute of limitations for Carmen’s crime has not expired. What is your answer now?
a. Nellie must tell the court, or the local prosecuting attorney, about Carmen’s embezzlement.
b. Nellie has no professional legal obligation to reveal this confidential confession from Carmen, to anyone.

5. Hanalei owns Hanalei’s Security Company, which is in business to provide security for private elementary schools in Seattle. One of the security guards hired by the company recently sexually abused a child at one of the schools that the company has a contract with. It turns out that no background check was ever done on this guard, because he was a high-school buddy of the owner of the company, Hanalei. Assuming the child's parents file a lawsuit against both the guard and the company:
a. the guard will be the only defendant liable
b. the company will be the only defendant liable
c. both the guard and the company will be liable
d. neither the guard nor the company will be liable

6. Andrew makes a written offer to Minnie: ''I will sell you the original oil painting I own, by the famous artist Larry, for $10,000 if you send an acceptance of my offer by this Friday, November 17, 2017.” Minnie mails her acceptance with the U.S. Postal Service, on Thursday, November 16, 2017, and has proof of mailing. Andrew does not receive Minnie’s acceptance letter until Monday, November 20. Meanwhile, the famous artist Larry dies on November 12, immediately increasing the value of all his existing artwork! Andrew now refuses to sell the painting to Minnie for $10,000, instead he demands $250,000 ! If Minnie takes Andrew to court to try to enforce the original offer, Minnie will probably win, based on the:
a. “firm offer rule”
b. "thumbnail rule”
c. “rule against perpetuities”
d. “mailbox rule"

7. You have found evidence that your company Vice President of Finance has been hiring independent-contractor truck drivers to take toxic waste from the company manufacturing plant, with directions for the drivers to take this waste out to the desert near Yamika, and dump it there, rather than to a toxic-waste disposal site. This has saved the company about $100,000 in disposal costs, so the Net Profit looks better this year. The VP of Finance will be due for a $5,000 bonus, based on this “cost savings,” although of course if anyone in the public finds out about it, the VP and the company itself could be charged with both state and federal crimes. Assuming that you report these facts to the state or federal government, who will be able to charge the VP with the criminal behavior?
a. the company alone
b. the government alone
c. the government and the company have to agree

8. Rob (a Single man) works as an appliance-repair technician for a nationwide appliance-service company, but the office he works for is located in Seattle. The company has given Rob an “Employee’s Handbook” that lists all of the employment benefits available to employees who have made it successfully through the first 6 months of employment. Rob has just completed his first 6 months with the company. In the Handbook, Rob sees that Married employees are to be provided with 100% pre-paid health-insurance for the Employee and the Employee’s spouse, and any children under the age of 21 still living at home. For Single employees (never married or divorced or widowed), the company will only give $50 per month for the Employee to use to cover part of the costs of health insurance. Rob checks around and finds out that he will need at least $300 per month to cover his health insurance.
Rob can challenge these discriminatory benefits, based on the following Revised Code of Washington statute:
a. RCW 49.60.030
b. RCW 49.60.180
c. RCW 49.44.090

9. Assume that February 1, 2017, the Seattle Mariners made an oral offer (over the phone) of a two-year coaching job to former NFL star OJ Simpson, for $200,000 per year, to begin on May 1, 2017, and go to April 30, 2019. OJ Simpson responds over the phone: “I accept!” OJ shows up for work on May 1, 2017, as scheduled, and works for the 6 months of May through October. Then, the Mariner’s President tells OJ he is fired, because they don’t need him anymore.
a. OJ has a valid, enforceable contract claim against the Mariners, for the remaining 18 months of the contract.
b. OJ would lose in court, because of lack of mutual consideration.
c. OJ would lose in court, because of lack of proper form.

10. Both Mara and Sarah are adults. Mara offered to sell her Salvador Dali painting to Sarah for $30,000. Sarah agreed, and promised to pay Mara the $30,000 one week later. They signed a simple agreement to that effect. One week later, Sarah paid Mara the money, and Mara delivered to Sarah the painting. At this point, we can say that they had
a. a fully-executed contract
b. a partially executory contract
c. a voidable contract
d. a void contract

11. The city has offered to purchase your house for $200,000, because they want to expand a city park that is right next to your house. You do not want to sell to the city, and besides, you think the house is really worth $300,000.
a. The city is out of luck.
b. The city can force you to sell for $200,000, under the power of eminent domain.
c. The city can force you to sell for $200,000, under the power of foreclosure.
d. The city can force you to sell for $200,000, under the power of judicial review.
e. The city can force you sell, but you can insist on a trial to establish the fair market value of the property.

12. Bill makes a written offer to buy Barbara’s 4-unit apartment house, for $500,000, with the purchase to close on December 1, 2017. Barbara signs the agreement. If Barbara changes her mind, and refuses to sell, Bill can go to court and get a court to force Barbara to sell the property, under the legal concept of:
a. eminent domain
b. specific performance
c. absolute performance
d. partial performance

13. One of the legal issues that is NOT covered by The Uniform Commercial Code (UCC) is basic employment contracts between employers and employees. T/F

14. Which law would cover contracts for the sale of real estate?
a. the federal Equal Pay Act
b. the Uniform Commercial Code
c. the common-law of contracts

FACTS for 15 & 16. Dianna makes an oral offer to Luisa: “If you cater my Thanksgiving-Day dinner for 10 guests, with traditional dishes like roast turkey with stuffing, baked yams, sautéed green beans, egg nog, apple sauce, apple cider, and pumpkin pie with whipped cream, I will pay you $1,000 on the Monday after the holiday.” Luisa accepts and promises to be there! Luisa does a great job with the catering, and all the guests tell Dianna how wonderful the meal was. On Monday following the holiday, Luisa asks Dianna for payment. Dianna hands over a check for just $600.00, saying: “Well, what you did bring over was good, but technically you breached the contract, since you neglected to bring any egg nog, so I am deducting a reasonable amount from the total.” You can assume that $50 would be enough to usually cover the cost of egg nog. Luisa comes to you for advice, because she wants the remaining $400 due on their agreement!

15. First – what kind of contract did they have, if any?
a. a unilateral oral contract for sale of goods
b. a unilateral oral contract for services
c. a bilateral oral contract for sale of goods
d. a bilateral oral contract for services
e. no contract at all - but Luisa should still win by Quasi-contract

16. IF Luisa takes this to court, we would expect the judge to:
a. Rule that Luisa committed a substantial breach of their agreement, so refuse to order Dianna to pay Luisa any more compensation.
b. Rule that Luisa committed a minor breach of their agreement. The judge would deduct a reasonable sum ($50 or so) from the total contract price, and order Dianna to pay Luisa the remaining part of the contract price (about $350).
c. Rule that there was no breach of the agreement, and order Dianna to pay the full remaining balance of the contract price ($400).

17. True/False Under the Washington state “statute of frauds” (a copy is in Canvas under Files – Washington State requirements for written contracts), an apartment lease for 3 years would have to be in writing.

18. Esmerelda owes about $25,000 in credit-card debt to Bank of America. She also had to have very expensive medical care over the last year, which amounted to another $75,000 in treatments and hospital care. She has talked to an attorney to see if the attorney can negotiate with these creditors to adjust her debts with them. (copies of the documents listed below are in Files) The attorney will probably ask Esmerelda to sign this document to empower him to act for Esmerelda:
a. Internal Revenue Service Form 2848, Power of Attorney
b. A General Durable Power of Attorney
c. A Special Limited Power of Attorney
d. Manufacturer’s Representative Agreement

19. Marty calls his neighbor Ned over, and says: "I have something for you - I think you will like it!" He hands Ned a wrapped package, and says "Happy Birthday, Ned!" Ned opens the package, and finds 2 tickets to the 2018 SuperBowl. Ned thanks Marty, they have a beer together, then Ned goes home. Two days later, Marty finds out Ned was the one who had been sending Marty obscene e-mail messages for several months. Marty demands the SuperBowl tickets back, but Ned refuses. Result if this goes to court?
a. There was a completed gift from Marty to Ned, and Ned does not have to return the tickets.
b. There was a completed gift from Marty to Ned, but Ned will still have to return the tickets.
c. This is not a “gift” issue at all – the issue is whether there was a bailment of the tickets!

20. Roger offers, in writing, to sell Luanne 20,000 shares of stock in Costco, Inc., for $200,000 total. Luanne sends Roger a written acceptance. Later on, if there is any dispute regarding this agreement, the court will refer to which set of laws to resolve this matter?
a. The UCC Article 2A.
b. The UCC Article 9.
c. The UCC Article 2.
d. The common-law of contracts.

21. Under the UCC, an express warranty may be created by a Seller showing a sample of a particular item to a Buyer, and the Buyer relying on that sample to make a purchase decision. T/F

22. Which one of the following warranties only applies if the Seller is a Merchant?
a. Express warranties
b. Implied warranty of fitness for a particular purpose
c. Implied warranty of merchantability
d. Implied warranty of good title
e. None of the above

23. True or False Ronald and Bill have entered into a written contract, whereby Bill will pay Ronald $10,000 for Ronald’s car, on December 1, 2017. At this price, Ronald will have made a profit on the sale of the car, in the amount of $4,000 over what he paid for it! 3 days later, Bill sends Ronald a letter in which he states: “I have changed my mind – I will not be buying your car.” When Ronald tries to sell the car to someone else, the highest price he can get is $9,000. Ronald has a valid claim against Bill for $1,000 in “lost profits.”

24. On September 12, 2017, Damon orally agrees to paint the exterior of Larry’s Warehouse building, for $30,000, to be completed by November 1, 2017. Larry promises to pay Damon by November 5, 2017, assuming the work has been completed. Damon and his assistants work very diligently, and complete the project on October 23! Larry still has not paid Damon as of November 12, 2017, and he sent Damon a note indicating that he would not be paying Damon. If Damon has to take Larry to court on this matter:
a. Larry will win, as the contract price was over $500, and it was not in writing, so not enforceable!
b. Larry will lose, as Damon had a binding, enforceable contract, and fully performed on the contract.

25. Knudt has promised to wash Adela's car every Saturday from now (November 12, 2017) through Adela’s graduation – on June 20, 2018. Adela has promised to pay Knudt $20 each week for this work. They are both over 18. The promises are oral. This is an example of a(n) _______________ contract.
a. void
b. unenforceable
c. formal
d. executed
e. valid, oral

26. Marnie is a contractor who builds smaller housing developments like duplexes, triplexes, and sometimes up to 12 units. Michelle enters into a contract with Marnie for Marnie to build Michelle a 10-unit apartment building, located on a property Michelle owns in the U District in Seattle. The construction materials will cost about 30% of the total costs. Labor to build the building will cost about 70% of the total costs.
a. this contract will probably not be covered by the UCC, because the dominant element of the contract will be the construction services.
b. this contract will probably be covered by the UCC, because this is a "sale of goods"

27. John is 80, and was thinking of selling his house and moving to a smaller house or apartment. He casually mentions this to his next-door neighbor Sally. Sally immediately offers to buy John's house for $100,000. John has owned the house for many years, and only paid $20,000 for it, so he thinks this is a good deal. They sign a simple real-estate sales contract form. Later, John lets his children know what he has done, and they are outraged - they let John know that the house is probably worth $250,000 or more. John should be able to get out of this agreement, on the basis of "lack of mutual consideration” on the part of Sally. True or False

28. Hui is a student at NSC. She has two laptop computers, and decides she only needs one. She puts an advertisement out on one of the NSC bulletin boards, offering to sell one of the laptops for half of what she bought it for - just $1,000, and indicating that the price would be good until 5 pm on November 10, 2017. Dan sees the ad, and calls Hui at noon on November 8, and tells Hui that he wants to buy Hui's computer, at the price shown on the bulletin board. Hui tells Dan that Hui has changed her mind – she is not going to sell it at the $1,000 after all - Hui wants $1,300 now. Dan threatens to take Hui to court - claiming that this situation is covered by the "firm offer rule." Is Hui's advertisement covered by the firm offer rule of the UCC? This is the first time Hui has ever tried to sell a computer.
a. yes - because the ad was in writing
b. yes - because Hui qualifies as a merchant
c. no - because the ad was in writing
d. no - because Hui qualifies as a merchant
e. no - because Hui is not a merchant

29. There is a clause in a contract between a property owner and a building contractor (for the construction of a house for $250,000). It states that if the contractor does not complete the house by the agreed completion date (July 31), then there will be a $10,000 reduction in the total amount due to the contractor. This clause would be referred to as:
a. a specific performance clause
b. a liquidated damages clause
c. an unconscionable clause
d. an un-enforceable clause

30. Renfrew Construction Company needs a backhoe to complete a water-pipe installation project in a subdivision. This project will be going on for about six months, so they enter into a six—month lease of a backhoe from Hofmann Equipment Rentals, to help with digging trenches for the water pipe. IF there are any disputes about this equipment-lease transaction, the governing law will be:
a. Article 2 of the UCC
b. Article 2A of the UCC
c. Article 3 of the UCC
d. the common law

31. Nita walks into Hank's Hardware Store and says, "I need metal storage shelves that can hold 500 pounds." Hank, the owner of the store, directs her to a metal storage shelving system, which Hank indicates will hold up to 800 pounds! Nita then buys the shelves. When Nita puts packages onto the bottom shelf, weighing 450 pounds, the shelf breaks, and Nita was hurt when the shelf broke. Hank's Hardware Store is liable for Nita’s injuries under which legal theory:
a. breach of warranty of merchantability
b. breach of warranty of title
c. product liability
d. breach of warranty for particular purpose
e. breach of Magnuson-Moss Warranty Act

32. A “statute of repose” places an absolute limit on when a lawsuit may be filed, regardless of when a product defect is discovered. True or False

33. How long is the statute of limitations for breach of warranty under the Uniform Commercial Code?
a. one year
b. two years
c. three years
d. four years
e. five years

34. Which one of the following statements could create an express warranty?
a. "This is the best car on the market!"
b. "This is a classic car - its value should just go up over time!"
c. "These tires have at least 10,000 miles of legal wear left!"
d. "This is a cream-puff car!"
e. None of the above

35. Jennifer applies for, and receives an interview appointment with a prospective employer for a real-estate loan officer position. Jennifer is in a wheelchair, as she had polio when she was a child, and her use of her legs is quite limited. When she arrives, the interviewer says: “Oh, sorry, we only employ people who can stand upright, because they have to be able to greet our customers “eye-to-eye” when the customers come in the see us.” Jennifer is not interviewed, and not offered a job. She meets all of the advertised requirements for the job, and has excellent references and previous job experiences, and excellent educational background for this position. Does Jennifer have a valid legal claim under federal law, against this employer? The employer is a bank with several branches, and about 200 employees.
a. No, Jennifer does not have a valid legal claim, as the employer is not discriminating against her on the basis of race, color, religion, national origin, or sex as provided by the federal Civil Rights Act of 1964.
b. No, Jennifer does not have a valid legal claim, as the employer does not have enough employees to be covered by the federal Civil Rights Act of 1964.
c. Yes, Jennifer does have a valid legal claim against the employer, on the bais of the Federal Equal Pay Act.
d. Yes, Jennifer does have a valid legal claim against the employer, on the basis of the Americans with Disabilities Act.

36. Roger asks his sister Judy to take his car to the auto-repair shop, and arrange for a paint job for the car. Judy negotiates a price of $1,000 for the job, and signs the agreement with the repair shop “Judy, as agent for Roger.” Who has the legal obligation to pay the auto-repair shop for the paint job?
a. Just Roger
b. Just Judy
c. both Roger and Judy
d. neither Roger nor Judy

37. Marci went to an interview for a position with Mama Mia’s Italian Kitchen in the Little Italy neighborhood in North Seattle. Mama Mia’s has about 25 full-time employees. Mama, the owner of the restaurant, takes one look at Marci, and tells her to go home – saying: “We only hire people with Italian heritage in our restaurant – I can tell by your blonde hair and super-white skin that your heritage must be from Northern Europe – like Sweden or Finland or Norway or Denmark or something!” In fact, Marci’s parents did emigrate to the US from Sweden. Marci wants to know if she has a valid legal claim against Mama Mia’s?
a. Yes, Marci does have a valid legal claim, as the employer is discriminating against her in violation of the federal Civil Rights Act of 1964.
b. Yes, Marci does have a valid legal claim against the employer, based on the Washington State law: RCW 49.44.100
c. Yes, Marci does have a valid legal claim against the employer, based on the Washington State law: RCW 49.60.180
d. both A and C are true
e. No, Marci does not have a valid legal claim, as the employer does not have enough employees to be covered by either the federal Civil Rights Act of 1964 or the Washington State anti-discrimination laws.

38. Same facts as for Question 37. However in this case, the prospective employer only has 6 full-time employees. You may want to look at the definition of employer under this Washington law: RCW 49.60.040
a. Yes, Marci does have a valid legal claim, as the employer is discriminating against her in violation of the federal Civil Rights Act of 1964.
b. Yes, Marci does have a valid legal claim against the employer, based on the Washington State law: RCW 49.44.100
c. Yes, Marci does have a valid legal claim against the employer, based on the Washington State law: RCW 49.60.180
d. both A and C are true
e. No, Marci does not have a valid legal claim, as the employer does not have enough employees to be covered by either the federal Civil Rights Act of 1964 or the Washington State anti-discrimination laws.

39. On Saturday, Serena writes a check for $500 to Sam, to buy Sam’s I-Phone. Sam’s bank has already closed, and he won’t be able to deposit the check until Monday, but he needs cash for a date that night. Sam calls around to his friends for help – offering to sell Serena’s check in exchange for cash. Finally, Philip, a friend-of-a-friend offers to pay Sam $400 for the check. Sam is not happy about the price, but he is desperate for cash, so he accepts the $400, and endorses the check over to Philip. When Philip takes the check to Serena’s bank on Monday, to cash it, how much will he get for it?
a. the $400 he paid to Sam. Serena’s bank will send the other $100 to Sam.
b. the full $500 that Serena wrote the check for. Sam will have a good legal claim for $100 from Sam.
c. the full $500 that Serena wrote the check for. Sam has no rights to any of this.

40. Melvin borrows $10,000 from his best friend Martin, so that Melvin can buy a convertible Mustang (1965) that he has always wanted. Martin is happy to help Melvin, but he also wants to be smart about lending money, so he asks Melvin to give Martin collateral in the form of a security interest in the car. What documents should Martin have Melvin sign?
a. a Promissory Note that mentions the car should be sufficient for this.
b. a Promissory Note, and a UCC Financing Statement filed with the state Secretary of State’s office in Olympia, Washington
c. a Promissory Note, and a Mortgage on the car, recorded with the county recorder
d. a Promissory Note, and a Deed of Trust on the car, recorded with the county recorder

1. What is an “inter-vivos gift”? a. A gift from a brother to a si...