Bcom Bachelor of Commerce Business Law 2 — Questions and Answers
Question 1: Which doctrine allows courts to refuse to enforce an unconscionable contract?
- Unconscionability doctrine (Correct answer)
- Parol evidence rule
- Statute of frauds
- Doctrine of frustration
Correct answer: Unconscionability doctrine
The unconscionability doctrine lets courts void or modify contracts that are oppressively one-sided or obtained through unfair bargaining.
Question 2: What does 'respondeat superior' mean in business law?
- An employer is liable for torts committed by employees within the scope of employment (Correct answer)
- A company must respond to all lawsuits
- Partners share superior authority
- Contracts must be written to be enforceable
Correct answer: An employer is liable for torts committed by employees within the scope of employment
Respondeat superior is a Latin doctrine holding employers vicariously liable for employees' negligent acts performed during employment.
Question 3: Under the US Statute of Frauds, which contract MUST be in writing to be enforceable?
- A contract for the sale of real estate (Correct answer)
- A one-year employment contract
- A contract to buy groceries
- An oral partnership agreement
Correct answer: A contract for the sale of real estate
Contracts for the sale of real property must be written and signed to satisfy the Statute of Frauds.
Question 4: What is an 'injunction' in business litigation?
- A court order requiring a party to do or stop doing a specific act (Correct answer)
- A monetary penalty
- A writ of summons
- A jury instruction
Correct answer: A court order requiring a party to do or stop doing a specific act
An injunction is an equitable court order compelling or restraining a specific action, often used to prevent irreparable harm.
Question 5: Which of the following is NOT a required element for a valid contract?
- Written form (Correct answer)
- Offer
- Acceptance
- Consideration
Correct answer: Written form
Most contracts can be oral; written form is not universally required unless mandated by the Statute of Frauds.
Question 6: What is 'liquidated damages' in a contract?
- A pre-agreed sum specified in the contract to be paid upon breach (Correct answer)
- Damages awarded by a jury
- Punitive damages for intentional harm
- Restitution paid after rescission
Correct answer: A pre-agreed sum specified in the contract to be paid upon breach
Liquidated damages are an amount the parties agree in advance represents a fair estimate of harm if one party breaches.
Bcom Bachelor of Commerce Business Law 2
Which doctrine allows courts to refuse to enforce an unconscionable contract?