Negotiability, Transferability, and Liability
1. What is a negotiable instrument? It is a signed writing (record) that contains an unconditional
promise or order to pay an exact sum on demand or at a specified future time to a specific person
BLAW3341: EXAM #1 REVIEW
1. What are the four primary sources of law in the United States?
The U.S. Constitution and the constitutions of the various states.
Statutes, or laws, passed by Congress and by state legislatures.
Regulations created by ad
Sole Proprietorships, Partnerships, LLCs
1. Who owns the business in a sole proprietorship? The proprietor
2. List three disadvantages of a sole proprietorship.
(1) Proprietor alone bears the burden of any losses or liabilities incurred by the
Creditors Rights & Bankruptcy
1. How does a creditor ensure that a judgment against a debtor for a past-due debt will be collectible? The
creditor can request that certain nonexempt property of the debtor be seized to satisfy the debt.
1. Describe the employment-at-will doctrine. At-will means it that an employer can terminate an employee at
any time for any reason, except an illegal one or for no reason without incurring legal liability. Likewise for the
1. What body is the ultimate authority in every corporation? The board of directors
2. How do people get onto the board of directors? The group are elected by a majority vote of the shareholders.
3. Name and briefly describe the rights corporat
1. What is a warranty? A warranty is an assurance by the seller or lessor of certain facts
concerning the goods being sold or leased.
2. What are the three types of title warranties that automatically arise in sales and lease contrac
Corporate Formation, Financing, & Termination
1. Briefly describe the following types of corporations:
a. Domestic corporation: Considered domestic in the state where the corporation is formed.
b. Foreign corporation: A corporation formed in on
1. What are the two parties in an agency relationship? Provide a brief description of what the parties do.
The agent - must exercise his or her powers for the benefit of the principal only.
The principal - has the right to
1. What is a security interest? It is the interest in the collateral that secures payment or performance of an
2. What are a creditors concerns if a debtor defaults? (1) Can the debt be satisfied through the pos