Answer all 3 MCQ's.

1. With regard to guarantees, which of the following is false?

a. A guarantor can use any defence against the creditor that the debtor could use.

b. A legally binding promise to be primarily responsible for someone else's obligation is an indemnity.

c. A verbal guarantee is as enforceable as a written one.

d. Subrogation can result in a guarantor's being able to sue successfully the very debtor whose obligation he guaranteed.

e. A legally enforceable guarantee must satisfy all the elements required to create a binding contract.

2. Which one of the following statements about bankruptcy is true?

a. Bankruptcy law is different in every province of Canada.

b. Bankruptcy refers to a situation in which a debtor who cannot pay debts transfers his assets to the creditors directly.

c. Bankruptcy law forces a debtor to pay all his debts, regardless of his financial position.

d. All creditors of a bankrupt debtor are treated equally and will receive shares of the assets directly in proportion to how much is owed to each of them.

e. A debtor who has been discharged from bankruptcy is free from recovery proceedings from most of his unsecured creditors previous to bankruptcy.

3. Why is the distinction between employment and an independent contract important?

a. An independent contractor cannot be sure that he will be paid.

b. An employee has the right to wages.

c. An employee can bind the employer in a contract he enters into on behalf of the employer.

d. An employer may be held responsible for torts committed by the employee.

e. Employees can withdraw their services.