I   True or False. 

1. The amount of damages is the sum of money that will place the injured party in the same position before the contract is formed.

2. Subsidiary is a distinct legal person.

3. Business judgement rule protects directors from personal liability even if their decisions  result in damage or loss, provided that their decisions are made in good faith, on an informed basis, and in a manner which the directors believe to be in the best interests of the corporation.

4. Where both parties have obligations toward each other and there is an order of priority in respect of the performance, if the party who is to perform first fails to perform, the party who is to perform later does not have the right to reject performing his duty. He must perform first and claim damages later.

5. A contract party may rescind the contract once the other party fails to perform his duty according to the contract.

6. Under L/C, the opening bank is entitled to reject payment as long as the buyer produces evidence that the goods are defected.

7. Stare Decisis applies in GB and US as well as France.

8. Read the following provision of Corporation Law: “If a shareholder of the company abuses its shareholder’s rights, thereby causing losses to the company or other shareholders, the shareholder shall be liable for compensation according to the law. If a shareholder of the company abuses the independent status of the company legal person and the limited liability of shareholders to evade debts and seriously harms the interests of the creditors of the company, it shall bear joint and several liability for the debts of the company.” This provision reflects “Piercing the Corporate Veil” theory.

9. A sent an offer to his client B. B replies:” Your price and quality accepted. I would like to place an order for 1000 metric tons. However, make sure you deliver the goods one month before the proposed date. “ B’s reply amounts to an acceptance.

10. Before a voidable contract is cancelled, it is valid and shall be performed.

II   Choose the right answer. (ATTENTION! PUT YOUR ANSWER IN THE BOX ABOVE )

1. Which of the following will be determined by shareholder’s meeting? (              )

A. Electing and changing the directors and supervisors assumed by non-representatives of the employees and deciding the matters relating to their salaries and compensations;

B. Making resolutions about the increase or reduction of the company’s registered capital;

C. Revising the bylaw of the company;

4. Working out the company’s annual financial budget plans;

2. Tom, Emma and Joy are college graduates. Tom has an idea to manufacture beer dispensers for home use. He believes this could make them very wealthy. His personal experience qualifies him to be both first-line supervisor and general manager of the new firm. Emma is a born salesperson. Joy has little interest in sales or management, but would like to invest a large sum of money that she has inherited from her uncle, and she wants no further liability should the beer dispenser manufacturing business fail. Which form(s) of business organization meet Tom, Emma and Joy’s requirement?(            )

A limited partnership;                                    B  limited liability company

C limited liability partnership;                              D  general partnership

3．Michael is chief director of L&L Limited Company. One day he learns that a client of L&L Company intends to buy 100 tons of cold rolled steel bar and has proposed negotiation with L&L. Michael contacts the client immediately and offers to sell at a lower price.  Michael’s behavior is a breach of (           )

A  Duty of loyalty;                                       B  Duty of care

C  Duty of Non-disclosure;                                D  Duty of confidentiality

4.Which of the following is/are offer? (            )

A  catalogs listing prices          B circulars                  C advertisements   

D  a quotation addressed to a specific client with an expression “valid by June 30th”.

5.About standard clause/contract, which is are true?

A If standard clauses are used in making a contract, the party that provides the standard clauses shall determine the rights and obligations between the parties in accordance with the principle of fairness.

B The party that provides the standard clauses shall call in a reasonable manner the other party's attention to the exemptible and restrictive clauses regarding its liability, and give explanations of such clauses at the request of the other party.

C Business are not allowed to incorporate any exemption clause in standard contract while they are transacting with consumers.

D The party that provides the standard clauses shall give explanations of such clauses at the request of the other party.

Answer rating: 100% (QA)

The amount of damages is the sum of money that will place the injured party in the same position bef... View the full answer