NALA Practice Exam Qs & As fully solved & updated

Which of the following are sources of law used in the American Legal System? - ANSWER-There are three major sources of law in the American Legal System: Statutory law, which is created by the legislative branch; case law, which the courts interpret and apply the law; and administrative rules and regulations. Executive orders fall under administrative rules. The court determines if court rules have been followed and creates case law on those rules. Civil law is a legal system utilized mainly in foreign countries where the only task of the court is to apply the law created by legislative bodies. Canon law is a legal system used exclusively by religious organizations. A quit claim deed is often used when? - ANSWER-To clear a title defect Who can make a valid will? - ANSWER-Anyone who is of sound mind and meets the statutory age requirement In preparing for trial, a paralegal cannot bill for: - ANSWER-Copying exhibits Which of the following is not an exception to offer? - ANSWER-Statement of intent Which type of deed is used to convey real property following a tax sale? - ANSWER-A tax deed is used to convey real property following a sale for tax delinquencies. A sheriff's deed is used to convey title following foreclosure on a mortgage or a court ordered sale for a judgment. A representative's deed is used to convey real property from a decedent's estate. A quit claim deed is used when the grantor is release any possible interest in real property it does not claim. Which type of deed is used to convey real property following a tax sale? - ANSWER-In a trust, the settlor creates the trust and appoints a trustee to manage the trust property for the benefit of the beneficiaries of the trust. Which of the following is not required in an offer? - ANSWER-Legal capacity of parties Statement of intent by offeror, definite proposal & terms, and communication to offeree are all required elements of an offer. Which is not a required element of a contract? - ANSWER-Seal The 3 main required elements of a contract are offer, acceptance and consideration. The unauthorized practice of law violations do not focus on: - ANSWER-Education of paralegals The Unauthorized practice of law focuses on what paralegals can and cannot do, along with how paralegals indicate who they are with clients/public. The requirements of due process of law apply only to: - ANSWER-Government actions, the requirements of due process of law are a limitation on government and therefore apply only to government actions. Bankruptcy Law in the United States is exclusively: - ANSWER-In the United States, bankruptcy is exclusively governed by federal law pursuant to Article I, Section 8, Clause 4 of the United States Constitution. Which of the following would satisfy the federal requirements for diversity of citizenship? - ANSWER-Diversity of citizenship is one way that a lawsuit can qualify to be litigated in federal court. If the adverse parties are from different states (and the case is worth at least $75,000), then the federal courts have jurisdiction. However, every plaintiff must be from a different state than every defendant, regardless of whether the parties are individuals, entities, or governmental units. Moreover, diversity is only relevant to civil suits; criminal jurisdiction is determined by the location and nature of the criminal offense alleged, not by any party's citizenship. Greg Sanders was injured in an auto accident. Emily Harris is the defendant. During the trial, Emily proves that Greg was not wearing his seat belt at the time of the accident, which caused more severe injuries to him. If the court bars any recovery by Greg because of own negligence, the court is following this doctrine: - ANSWER-If the defendant is successful in proving the plaintiff was contributorily negligent, the plaintiff cannot recover any damages from the defendant, even if the defendant's negligence was a more substantial cause of plaintiff's injury than the plaintiff's own contributory negligence. Thus, contributory negligence is an absolute defense to a plaintiff's law suit, even if the plaintiff's contributory negligence was only a slight cause of his or her injuries. The subject matter in a real estate offer must include: - ANSWER-The subject matter of a real estate transaction must identify the land and the price. Elmer's transfer to Tom of rights he has under a contract with Pepperdine's, a Nevada retail company, is known as: - ANSWER-An assignment A delegation is a transfer of duties so A is not the correct answer. Elmer and Tom are parties to the contract so they are neither kind of third party beneficiary. After the producing party notifies the receiving party of inadvertent production under the "clawback" provision of Federal Rule of Civil Procedure 26, the receiving party can: - ANSWER-Federal Rule of Civil Procedure 26(b)(5)(B) states that if information produced in discovery is subject to a claim of privilege or of protection as trial-preparation material, the party making the claim may notify any party that received the information of the claim and the basis for it. After being notified, a party must promptly return, sequester, or destroy the specified information and any copies it has; must not use or disclose the information until the claim is resolved; must take reasonable steps to retrieve the information if the party disclosed it before being notified; and may promptly present the information to the court under seal for a determination of the claim. The producing party must preserve the information until the claim is resolved. Shelby wants to sell her property known as Blackacre, but there are several issues with the title to the property. Which of the following does not represent a lien on title to Blackacre (assuming that all necessary documentation to perfect a lien has been filed with the local Recorder of Deeds' office)? - ANSWER-Shelby rented the property last year to Eric, and Eric's creditor obtained a judgment against him As a tenant, Eric has no ownership interest in Blackacre, and therefore his creditor cannot place a judgment lien on the title to the property. A mortgage represents a lien on title as do unpaid property taxes. As a contractor who worked on the property, Ben has a mechanic's lien on the property. How many articles are there in the Federal Rules of Evidence? - ANSWER-The 11 articles are 1) General Provisions, 2) Judicial Notice, 3) Presumptions in Civil Actions and Proceedings, 4) Relevancy and Its Limits, 5) Privileges, 6) Witnesses, 7) Opinions and Expert Testimony, 8) Hearsay, 9) Authentication and Identification, 10) Contents of Writing, Recordings, and Photographs, and 11) Miscellaneous Rules. The tort of fraud involves the misrepresentation of facts for the purpose of inducing another party to rely on the misrepresentation. Which one of the following elements is an integral part of the tort of fraud? - ANSWER-Intentional conduct The basis of an action in fraud, and the factor which distinguishes it from other types of negligence, is intentional conduct of the defendant as opposed to negligent conduct. You are a new paralegal learning to bill your time. Which of the following is a best-practices tip to follow? - ANSWER-Bill the client only for work performed on their particular case. Proceed You should bill the client only for the actual time you spend working on their case. You don't bill clients for time spent on personal matters. You never pad your time sheet to match the time you spend at the office - clients shouldn't pay for administrative or personal time. And you shouldn't double bill by doing one activity and billing multiple clients for it. In the U.S. court system, lower courts are typically required to follow binding opinions of higher courts in the same jurisdiction. What is this concept called? - ANSWER-Stare decisis is a Latin phrase meaning "to stand by things decided." It means that courts must follow precedents set by higher courts of their jurisdiction. Appellate review and certiorari are processes by which higher courts reconsider and potentially alter decisions of the lower courts (the reviewing court would still be bound by stare decisis). Bench trials are trials in which the judge sits as factfinder (rather than a jury). Published decisions of higher courts would be more than just persuasive authority; they would be binding on lower courts. How many days does the movant have to file and serve a Motion for Summary Judgment? - ANSWER-Anytime until 30 days after the close of all discovery. See Fed.R.Civ.. 56(b) But note that local court rules or court order can modify the cutoff date. Hunter states that he would like to buy Ginger's house for $100,000. Which of the following requirements for an offer is lacking? - ANSWER-Time for performance Hunter's offer includes the subject matter (Ginger's house), the nature of performance (purchase and sale of Ginger's house), and quantity (one, the house Ginger owns), but does not specify the time for performance (the time of the purchase and sale of Ginger's house). Who has a right to receive dividends? - ANSWER-Preferred shareholders at all times, and common shareholders whenever dividends have been declared. Preferred stock pays dividends according to the schedule set by the corporation. Even if there is no profit, dividends are still due to preferred shareholders. No shareholder is entitled to dividend at all times. Dividends are not declared for preferred stock as these are paid on a schedule. A Qualified Terminable Interest Property trust may qualify for a marital deduction if the following conditions are met: - ANSWER-Spouse is entitled to receive all trust's income; during spouse's lifetime no person is permitted to distribute any trust property to anyone other than the spouse; and the person filing the estate tax return properly takes a marital deduction for the QTIP trust, and properly makes the required QTIP election on the return. A Qualified Terminable Interest Property trust, allowed under IRC Section 2056(b)(7), is an exception to the general rule. A QTIP trust may qualify for a marital deduction if: Spouse is entitled to receive all trust's income; during spouse's lifetime no person is permitted to distribute any trust property to anyone other than the spouse; and the person filing the estate tax return properly takes a marital deduction for the QTIP trust, and properly makes the required QTIP election on the return When property is held in trust, the title is divided between the trustee and the beneficiaries. The terms for the divided title are legal title and equitable title. Which of the following statements about title to trust property is correct? - ANSWER-Legal title refers to the right to manage the trust property while equitable title refers to the right to receive the benefits of the trust property. The trustee holds legal title to the property which is the right to manage the trust property, and the beneficiaries hold equitable title to the property which is the right to receive the benefits of the trust property. Which of the following is not a characteristic of a classic retainer fee? - ANSWER-Belongs to client until fees are earned. A classic retainer is considered earned upon receipt, regardless of whether any work was performed by the attorney. Retainers are typically non-refundable. Unlike a security deposit, which belongs to the client until fees are earned and any unearned portion is refunded, a retainer belongs to the attorney and not the client. In general, an offer may be terminated before it is accepted if the offeror communicates her revocation of the offer to the offeree. Which of the following examples would constitute a limitation on the offeror's right to terminate the offer before acceptance? - ANSWER-A real estate option executed between David and Arnold. An option is an independent contract in which the offeror is paid by an offeree to keep an option to purchase open for a specified period of time. Until the period of time has expired, the offeror may not sell the property to a party other than the offeree. None of the other examples contains any element which prevents Arnold from withdrawing or modifying his offer at any time before it has been accepted. Mens rea and actus reus joined together are known as: - ANSWER-Concurrence Mens rea and actus reus are the two essential elements of a crime. Mens rea describes the state of mind that is required to be held criminally liable except in cases of vicarious and corporate liability; and actus reus describes the actual, voluntary action or conduct that is required to be held criminally liable for a crime. It's important to note that mens rea alone does not constitute a crime however, actus reus alone could constitute a crime. Together when mens rea and actus reus are joined concurrence occurs. Proof of concurrence establishes a link between the desire to commit a crime and the crime itself. Select the appropriate response Ozzy is the manager for Dragon's Eye, LLC. Ozzy, in his capacity as the LLC's manager, has the authority to enter into contracts for the company. With respect to binding Dragon's Eye, LLC, to contracts, Ozzy is: - ANSWER-Ozzy, whether a member or not of the LLC, has been authorized to contract on behalf of the LLC. Therefore, he is their agent and has the authority to form binding contracts on behalf of the LLC. In the context of legal research, what are "reporters"? - ANSWER-Judges' opinions are published in books called reporters. The term is a bit confusing because it sounds like a reference to people, but in the legal context, reporters are collections of judicial opinions bound in several published volumes. Reporters do not contain statutes; those are published in code books. Billy intends to shoot Noah but is a bad shot and accidentally shoots and injures Brittany with the bullet. Which of the following can Brittany use to recover damages from Billy? - ANSWER-Transferred intent is a legal doctrine which allows the intent to be shifted from intentional tort that the defendant tried to commit to the intentional tort the defendant actually committed. The United States Supreme Court is: - ANSWER-The highest court in the country, head of the federal judicial branch, and is responsible for deciding whether laws violate the U.S. Constitution. The Supreme Court is the only federal judicial entity established by the United States Constitution. Article III of the U.S. Constitution begins: "The judicial Power of the United States, shall be vested in one Supreme Court, and in such inferior Courts as the Congress may from time to time ordain and establish." An Operating Agreement for a limited liability company provides provisions related to: - ANSWER-Management, division of profits, and transfer of membership. An unincorporated business formed by 2 or more individuals is called: - ANSWER-General Partnership A limited liability company, limited partnership and nonprofits are all incorporated businesses. A general partnership does not have to be formed by filing an incorporation document. Strict liability amounts to liability without fault in a tort case. Strict liability is: - ANSWER-Imposed on ultrahazardous activities. Strict liability is an absolute legal responsibility for an injury that can be imposed on the wrongdoer without proof of carelessness or fault. It is typically imposed on ultrahazardous activities that necessarily involve a risk of serious harm which "cannot be eliminated by the exercise of utmost care and which is not a matter of common usage." An example of strict liability and ultrahazardous activities is the storage of explosives. Matthew has leased his office space from his landlord for a number of years. He is very happy with this arrangement and has no plans to move or immediate interest in buying the property. However, he is concerned that the landlord might attempt to sell the property in the future. If that happens, he would prefer to purchase the property rather than deal with a different landlord. Which provision should Matthew request the landlord add to his lease? - ANSWER-Right of first refusal A right of first refusal would mean that if at any time during the term, the landlord receives an offer to purchase the office building which the landlord is prepared to accept, she would be required to provide Matthew with notice of the terms of such offer. Matthew would then have a specified period of time in which to notify the landlord in writing that he intends to enter into a contract with the landlord upon the same terms and conditions. An option to purchase would provide Matthew with the right to purchase the office building under specified terms, including the purchase price. While this would provide Matthew with the ability to purchase the property, it would require the parties to negotiate certain terms now which may not fit the circumstances if and when a potential purchaser presents the landlord with an offer. An option to renew would only provide Matthew with the right to extend the term of his lease and a termination clause would only provide him with the right to terminate the lease before its expiration date. Which of the following would best describe a protected trademark? - ANSWER-A distinctive mark, symbol, word, name or logo used to identify the goods of a particular business. A trademark is a unique word, name, symbol, logo or mark used to identify the goods of a particular business which is protected from infringement by the Lanham (Trademark) Act. What is the purpose of the Federal Rules of Civil Procedure? - ANSWER-The Federal Rules of Civil Procedure dictate court procedures for civil cases. The Federal Rules of Civil Procedure 2017 Edition gives this specific purpose: to govern court procedures for civil cases. A will serves which of the following purposes? - ANSWER-To appoint a personal representative to administer the testator's estate after death. The testator's will must name a personal representative to manage the testator's estate after death. The other answers are incorrect because a power of attorney is a separate document from a will and end-of-life decisions cannot be made in a will because a will does not become effective until the testator's death. A will does not provide a means to protect the testator's estate from creditors. Loss of consortium is a cause of action that is available for: - ANSWER-A husband about his wife. Tom creates a trust for the benefit of his only daughter, Anna, on July 10, 2017. The terms of the trust allow any third party to make contributions to the trust. Tom contributes $15,000 on August 1, 2017; Jim contributes $2,000 on August 3, 2017; and Anna contributes $50 on September 1, 2017. Which statement best describes the status of the parties? - ANSWER-Tom, Jim, and Anna are grantors to the trust; Anna is also a beneficiary of the trust. In determining whether a defendant is liable for negligence, it must first be ascertained whether the defendant owed a "duty of care." Duty of care is: - ANSWER-The obligation people owe to each other not to cause any unreasonable harm or risk of harm. Duty of care refers to the obligation people owe to each other-the duty not to cause any unreasonable harm or risk of harm. Which of the following constitutes a valid offer? - ANSWER-Joan tells Phillip that she will sell her car to him for $5,000 next weekend. Joan's statement that she will sell her car to Phillip for $5,000 next weekend contains the required terms for an offer, including a certain identification of the offeree, the price, the time of payment, delivery, or performance, the quantity, and the nature of the work or performance. An advertisement is generally considered an invitation to make an offer, not an offer itself. An auction is considered a solicitation for offers unless the auction is conducted without reserve so that the auctioneer may not withdraw the goods once bidding commences. Joan's statement that she will sell her car is not sufficiently definite and certain to constitute an offer. A court that has the authority to hear a matter before any other court is within the: - ANSWER-Original jurisdiction. The court in the jurisdiction where the legal matter occurred will usually hear matters before any other court. What is the maximum number of interrogatories allowed in Federal Court? - ANSWER-25. According to the Federal Rules of Civil Procedure, "Unless otherwise stipulated or ordered by the court, a party may serve on any other party no more than 25 written interrogatories, including all discrete subparts. Leave to serve additional interrogatories may be granted to the extent consistent with Rule 26(b)(1) and (2)." Which of the following scenarios is an ethical way to discuss a client's case: - ANSWER-In the attorney's office, discussing questions for the deposition next week The Equal Employment Opportunity Commission (EEOC) responsibilities include: - ANSWER- Which of the following is an example of primary authority? - ANSWER-The United States Code is the federal statutory compilation, so it is primary authority. Primary law includes constitutions, statutes, administrative rules and regulations, and case law. Mens rea and actus reus joined together are known as: - ANSWER-Mens rea and actus reus are the two essential elements of a crime. Mens rea describes the state of mind that is required to be held criminally liable except in cases of vicarious and corporate liability; and actus reus describes the actual, voluntary action or conduct that is required to be held criminally liable for a crime. It's important to note that mens rea alone does not constitute a crime however, actus reus alone could constitute a crime. Together when mens rea and actus reus are joined concurrence occurs. Proof of concurrence establishes a link between the desire to commit a crime and the crime itself. Which of the following is not a characteristic of a classic retainer fee? - ANSWER-A classic retainer is considered earned upon receipt, regardless of whether any work was performed by the attorney. Retainers are typically non-refundable. Unlike a security deposit, which belongs to the client until fees are earned and any unearned portion is refunded, a retainer belongs to the attorney and not the client. What is "Intellectual Honesty?" - ANSWER-Intellectual Honesty is based on objectivity and can be best utilized for fact-finding missions, investigations, and legal memoranda that focus on the facts of the case. Which of the following is not a reason a court would decide to pierce the corporate veil of a corporation or LLC: - ANSWER-The corporation or LLC did not file their tax returns timely Under which circumstances should a judge not part from precedent when deciding a case? - ANSWER-While it is uncommon, judges do have the right to veer away from precedent when they deem it is appropriate. Of the answers given, the only reason a judge isn't ethically allowed to do this is simply because they don't respect the former judge. If they feel the judge's decision was incorrect, if the decision no longer supports public policy, or they don't feel the case is on point, the judge can choose not to follow precedent and make his/her own decision. A criminal proceeding at which the defendant is officially called before a court of competent jurisdiction, informed of the offense and asked to enter a plea is: - ANSWER-An arraignment When determining product liability under a theory of strict liability: - ANSWER-Duty and breach of duty are not elements for recovery under a strict liability theory of products liability. Under the Model Business Corporation Act, shareholders of a small or close corporation (corporation owned by a small number of shareholders) may enter into a shareholder agreement which allows the corporation to dispense with certain corporate formalities except for one of the following: - ANSWER-Under Section 7.32 of the Model Business Corporation Act, Shareholder Agreements are authorized which let Shareholders dispense with the formality of a Board of Directors and holding annual Shareholder meetings. This section of the Act does not allow for the Corporation to dispense with officers. Tim leases an office located in a building downtown. Tim's office makes up one-half of the space in the building. Tim pays $1,000 a month as base rent. In addition, Tim pays one-half of the amounts the landlord must pay for taxes, insurance, and common area maintenance for the building. Tim also pays the costs of utilities which are billed for his space separately and hires a janitor to clean his office. Which type of lease does Tim have? - ANSWER-In a triple net lease, the tenant pays its pro-rata share of the three "nets" (property taxes, insurance, and common area maintenance), in addition to base rent. Common area utilities and operating expenses are usually included in a triple net lease; for example, the cost for staffing a lobby attendant would be part of the triple net fees. Triple net lease tenants also pay the costs associated with their premises, including janitorial services, utilities, and their own insurance and taxes. A single net lease would be similar, but would only charge the tenant for its pro-rata share of one of the "nets." Under a gross lease (also known as a full service lease), rent is all-inclusive. This means that the landlord pays all "nets" associated with the property out of the rent received from tenants. Utilities and janitorial services are also included. A modified gross lease (also known as a modified net lease) is similar to a gross lease in that the rent is paid in one lump sum, which can include any one or more or all of the "nets," but utilities and janitorial services for the premises are typically excluded from the rent and paid directly by the tenant. An example of a criminal offenses that are malum prohibitum would be: - ANSWER-Criminal offenses that are malum prohibitum are criminal due to legislative declaration. Examples of malum prohibitum include: tax evasion and failure to file tax returns. How many Canons are there in NALA's Code of Ethics and Professional Responsibility? - ANSWER-10 Which of the following is a right of the landlord under a lease of real property? - ANSWER-Under a lease of real property, the landlord has the right to have the premises returned in the same condition as it was in when conveyed to the tenant, ordinary wear and tear excepted. The landlord has a duty to deliver possession to the tenant at the inception of the lease. As provided by most state statutes and as interpreted by many courts, modern leases include an implied warranty of habitability, meaning that the landlord has a duty to provide a premises which is tenantable. The landlord has a duty to maintain the common areas under its control. As a result, the landlord will be held liable for damages sustained by third parties within the common areas. The statute of frauds is concerned with: - ANSWER-The statute of frauds is concerned with the enforcement of a contractual agreement, not with the validity of its terms. The validity is determined by meeting the six requirements. Enforceability is concerned with whether the contract can be given force in a court of competent jurisdiction. The statute of frauds also does not change the interpretation of the contract clauses. It merely places and additional requirement - that the contract be in writing. What is the most commonly used type of freehold estate today? - ANSWER-The most common freehold estate in use today is the fee simple estate, which contains all the rights that can possibly relate to land. The fee tail estate was essentially the same as the fee simple estate, but it could only be inherited by the children or grandchildren of the owner. Most jurisdictions have abolished or modified the fee tail estate. The life estate terminated upon the death of the holder and could therefore not be inherited. The life estate is rarely seen today. Trusts are often used to accomplish the same results as the life estate. Loss of consortium is a cause of action that is available for: - ANSWER-A husband about his wife. Loss of consortium is available to family members. Which of the following is true about both a general partnership and a limited partnership: - ANSWER-Each partner in a general partnership and each general partner in a limited partnership has personal liability for all the debts and obligations of the general partnership The following is an example of which type of contract? Geoff promises to pay Shawn $1,000 if Shawn landscapes Geoff's yard and Shawn promises to landscape the yard. - ANSWER-A bilateral contract consists of mutual promises between the parties such as the promises between Geoff and Shawn. A bilateral contract can also be formed by the promise by the offeree and the beginning of performance by the offeree. In such a case, if Shawn began to landscape the yard without making a promise to do so, his start of performance would be adequate to establish a bilateral contract. A unilateral contract consists of a promise made by the offeror which seeks performance from the offeree (rather than a promise from the offeree) and the offeror clearly indicates that performance is the only method of acceptance of the contract. Since Geoff's offer does not require acceptance by performance, this is not a unilateral contract. An implied contract is formed by an indication of assent by conduct instead of by words. In the present example, Shawn expressed his promise by specific words so the contract is not implied. A quasi-contract is not technically a contract. It is a fiction created by courts to prevent unjust enrichment by one party of a benefit conferred by another. Since the present example was formed by mutual agreement between Shawn and Geoff, it is not a quasi-contract. It is an ethical violation for a paralegal to do the following: - ANSWER-Respond to inquiries regarding a case from the general public. Communications with individuals regarding the status of a case is the responsibility of the attorney. Paralegals are allowed to relay information to the client as long as the lawyer has given them permission to do so. They may also conduct the initial interview of a client as long as the sole purpose of the meeting is to gather information. They may provide addresses for filing a motion. The personal representative administering a decedent's estate who died testate is called a(n): - ANSWER-Executor. An executor administers a decedent's estate who died testate. A trustee administers a trust. A trustor is the creator of a trust. Under NALA's Model Standards and Guidelines of the Utilization of Paralegals, a supervised paralegal cannot: - ANSWER-A paralegal cannot sign a motion. Under guideline 5 of the Code there are 3 specific kinds of tasks that paralegals may perform under the appropriate lawyer supervision: (1) Factual investigation & research, (2) Legal research, and (3) Preparation of legal documents. When forming a partnership between 2 or more individuals, which of the following is required: - ANSWER-The partnership must obtain a federal employer identification number from the IRS Congress sets up an administrative agency through an enabling act and gives that agency the powers to make rules and regulations within the agency through: - ANSWER-While the Constitution does now allow Congress to delegate its law-making responsibilities to other entities, it does allow Congress to set up an administrative agency through an Enabling Act, THEN allow that agency to set its own rules and regulations. Concepts such as fairness and due process still prevail within these rules and regulations and there is an appeals process, eventually into the regular judiciary, that can help an administrative agency from gaining too much power. According to the Federal Rules of Civil Procedure, which pleadings are allowed? - ANSWER-A Complaint, an Answer to a Complaint, An Answer to a Counterclaim, an Answer to a Crossclaim, a Third-Party Complaint, an Answer to a Third-Party Complaint, and if the Court orders one, a Reply to the Answer. A new trial by a different tribunal is a: - ANSWER-Trial de novo In a bench trial the judge is the finder of fact. In a jury trial the jury is the finder of fact. A mock trial is simulated trial. The federal courts have original jurisdiction of all civil matters where: - ANSWER-28 U.S.C. Section 1332(a). The federal courts have original jurisdiction when the amount in controversy exceeds $75,000 and the parties are citizens of different states. 1332(a)(2) states that the federal courts shall not have original jurisdiction when the action is between citizens of a state and citizens of a foreign state who are lawfully admitted for permanent residence in the U.S. and reside in the same state. Res Ipsa Loquitur means: - ANSWER-The accident that occurred, normally does not happen in absence of negligence. Res Ipsa Loquitur is a Latin phrase that means "the thing speaks for itself" and applies in a tort case where the accident itself would not happen but for someone being negligent, like the collapse of bleachers at a football game or a mouse found in a bottle of soda. Which of the following is correct about the laws of intestate succession? - ANSWER-The laws of intestate succession dictate who will inherit the decedent's property if the decedent dies without a valid will, and they vary from state to state In a civil lawsuit, what role does the jury play? - ANSWER-In civil litigation, judges are always tasked with interpreting and explaining the law, whereas jurors are empaneled to resolve factual disputes. The relevant issues are framed by the attorneys litigating the case (and in the event of disagreement, by the judge). Which of the following would satisfy the federal requirements for diversity of citizenship? - ANSWER-Diversity of citizenship is one way that a lawsuit can qualify to be litigated in federal court. If the adverse parties are from different states (and the case is worth at least $75,000), then the federal courts have jurisdiction. However, every plaintiff must be from a different state than every defendant, regardless of whether the parties are individuals, entities, or governmental units. Moreover, diversity is only relevant to civil suits; criminal jurisdiction is determined by the location and nature of the criminal offense alleged, not by any party's citizenship. Heather, the owner of Organic Farms, a sole proprietorship, wants to obtain additional business capital for expansion. Her goal is to maintain control of all aspects of the business. This can best be accomplished by: - ANSWER-Borrowing funds If Heather brings in general partnership then she will love exclusive control so "Bringing in general partners" is not the answer. "Issuing stock" is incorrect as only corporations issue stock. "Selling the business" is incorrect as she wants to expand which doesn't indicate a desire to sell. John, who owns real estate known as Blackacre, owes a debt of $15,000 to Trisha. Trisha sues John and obtains a judgment which she files with the county Recorder of Deeds office. How will Trisha's filing the judgment affect Blackacre? - ANSWER-The judgment represents a lien against Blackacre which John will have to satisfy if he wishes to sell the property. When Trisha filed her judgment in the county deeds office, the judgment became a lien against all real estate that John owned in the county. If John were to sell Blackacre, to transfer title that is free and clear of the lien, he would have to satisfy the judgment. However, the lien does not convert to a mortgage, and John does not automatically lose title to Blackacre. In the United States, who creates statutory law? - ANSWER-Legislators. Judges only interpret statutes; they do not write them. Reporters (in the legal context) are not people but books where judicial opinions are published. The executive branch (which includes governors) enforces statutes but does not create them. Only legislative bodies can enact statutes. After a negligence trial, the jury allocates fault between the defendants (D1 and D2) and the plaintiff (P) as follows: • D1 was 10% at fault. • D2 was 35% at fault. • P was 55% at fault. Assume the trial took place in a jurisdiction that recognizes comparative fault. If the jury awards $100,000, how much money will the Plaintiff collect? - ANSWER-Comparative fault seeks to award an injured part for at least some of her injuries based on comparative negligence. Where Plaintiff has been found to be 55% at fault, the court will only award damages of 45% of the total award, thus $45,000 of the $100,000 found by the jury. Jerry Smith, a single man, dies intestate at the age of 29. Jerry has a sister, Anne Smith. Anne meets with an attorney to administer Jerry's estate. Anne will receive Jerry's interest in the real property without going through probate. Which of the following best describes how Jerry Smith held title? - ANSWER-Jerry Smith and Anne Smith, as joint tenants. Joint tenancy automatically creates a right of survivorship and does not pass through probate administration. All of the other types of ownership will require some type of summary proceeding, informal administration, or probate proceeding. When property is held in trust, the title is divided between the trustee and the beneficiaries. The terms for the divided title are legal title and equitable title. Which of the following statements about title to trust property is correct? - ANSWER-The trustee holds legal title to the property which is the right to manage the trust property, and the beneficiaries hold equitable title to the property which is the right to receive the benefits of the trust property. A valid will requires which of the following elements? - ANSWER-A valid will has four requirements: 1. Legal capacity - a testator must have the legal capacity to execute a will, the Uniform Probate Code has established the age of 18 years, this is also the age most states grant legal capacity 2. Testamentary capacity - usually courts require: the testator must comprehend the action being taken and its effect, must know the nature and extent of the property, must recognize the natural objects of the property, and have held the first the elements in the testator's mind long enough to make a reasoned judgment regarding property disposition 3. Testamentary intent - a valid will must reflect the testator's intent and serve as his desire to make a revocable disposition of property that takes affect after the testator's death; and 4. Formalities - valid will must meet certain formalities, some must be in writing, signed and witnessed. Type of necessary formality depends on type of will. Colin and Jessica are co-owners of real property known as Blackacre. Colin does not want to own the property any longer, and he is willing to give it to Jessica without any compensation. However, he does not want to be liable to Jessica if there are any defects in title to the property. What type of deed should Colin execute in favor of Jessica? - ANSWER-A quitclaim deed simply allows the owner to surrender any rights that he or she has in the property without making any representations as to the quality of his or her title to the property. General and special warranty deeds include guarantees by the grantor, and a deed of trust is used to specify a lender's right in the property. Assumption of the Risk involves: - ANSWER-Plaintiff having actual or constructive knowledge of the risk; plaintiff must appreciate the character of the risk; and plaintiff must voluntarily accept the risk An Operating Agreement for a limited liability company provides provisions related to: - ANSWER-Management, division of profits, and transfer of membership. The operating agreement is a very flexible agreement in which the members of the LLC outline how to govern the LLC. "Election of officers, transfer of membership, and management" is incorrect because under the model LLC Act, officers are not contemplated (they are a matter of corporate law). "The sale of stock, division of profits, and dissolution of entity" is incorrect because ownership interests in an LLC are member interests, not stock. "The dissolution of entity, election of directors and transfer of membership" is incorrect because under the model LLC Act, directors are not contemplated (they are a matter of corporate law). An unincorporated business formed by 2 or more individuals is called: - ANSWER-General Partnership A limited liability company, limited partnership and nonprofits are all incorporated businesses. A general partnership does not have to be formed by filing an incorporation document. A charitable remainder trust (CRT) is used to reduce income and capital gains taxes while increasing the settlor's immediate cash flow. Some of the benefits for the settlor of this type of trust include: - ANSWER-A lifetime of income from the CRT assets during her life or a specified number of years. A lifetime of income from the CRT assets during her life or a specified number of years Which of the following is true of a C Corporation? - ANSWER-It must have more than 100 shareholders Which of the following is acceptable for an attorney to give a paralegal when the paralegal has brought a new client to the office? - ANSWER-A "thank you" It is unethical to receive anything of monetary value for referring clients to a firm. The most an attorney should give is a "thank you". These other options are items of value. A grantor conveys real property consisting of an apartment complex to a grantee. The grantor has informed the grantee of the existence of several leases of individual apartments within the complex. The disclosed leases would be exceptions to which covenant contained in a warranty deed? - ANSWER-Quiet enjoyment In a covenant of quiet enjoyment, the grantor warrants that the grantee will be able to enjoy the real property against the claims of third parties. Because the grantee is aware of the leases and is taking title subject to them, the leases would be an exception to, but not a violation of, the covenant of quiet enjoyment. Through the covenant of seisen, the grantor warrants that she possesses and owns the real property and through the covenant of right to convey the grantor represents that she has the right to convey such property. In this case, the grantor does own, possess, and have a right to convey the real property, subject to the rights of the lessees therefor there is no exception to the covenants of seisen or right to convey. Through the further assurances covenant, the grantor covenants to do any acts reasonably necessary to protect the grantee's title if that becomes necessary in the future. Because the grantee is aware of the leases and is taking title subject to them, the grantee would not have the right to demand that the grantor protect the grantee's title against the leases in the future. ABC, Inc. and XYZ, Inc. are two existing corporations. ABC, Inc. makes a proposal to the shareholders of XYZ, Inc. to purchase their shares of XYZ, Inc. This is an example of a: - ANSWER-Tender offer A tender offer bypasses the board of directors and attempts to gain control of a corporation by purchasing a majority of the corporation's shares directly from the shareholders. A TILA-RESPA Closing Disclosure (TRID form) is required to be completed for which types of real estate transactions? - ANSWER-The Dodd-Frank Act requires the TRID Closing Disclosure form to be used for real estate transactions that involve a close-ended consumer mortgage (however, the form is not used for reverse mortgages or home equity lines of credit). The form is not required for all real estate transactions, nor is it required for all real estate sales. For example, the form is not required for a cash sale of real estate. How many articles are there in the Federal Rules of Evidence? - ANSWER-The 11 articles are 1) General Provisions, 2) Judicial Notice, 3) Presumptions in Civil Actions and Proceedings, 4) Relevancy and Its Limits, 5) Privileges, 6) Witnesses, 7) Opinions and Expert Testimony, 8) Hearsay, 9) Authentication and Identification, 10) Contents of Writing, Recordings, and Photographs, and 11) Miscellaneous Rules. An example of a criminal offenses that are malum prohibitum would be: - ANSWER-Criminal offenses that are malum prohibitum are criminal due to legislative declaration. Examples of malum prohibitum include: tax evasion and failure to file tax returns. According to the Model Penal Code, there are four states of mind that relate to mens rea, they include: - ANSWER-According to the Model Penal Code the four states of mind recognized to establish mens rea are: purposeful, negligent, reckless and knowing. A purposeful mind has the desire to cause the affect; a negligent mind takes unjustified risks that deviate from the normal standard of conduct; a reckless mind has an indifference to the safety of others or the consequences of actions; and a knowing mind is aware of the consequences and outcome of the specific act. Which of the following is a right of a tenant under a lease of real property? - ANSWER-Under a lease, a tenant has the right of quiet enjoyment of the real property. This means that the tenant has exclusive possession during the lease term and may not be disturbed by the landlord or any other party with superior rights. Under the lease, the tenant has the duty to pay rent to the landlord and to refrain from committing waste upon the real property by damaging the premises, failing to prevent damage, or altering the premises in substantial ways. Because the tenant is in possession of the leased property, it is liable for damages sustained by third parties within the premises unless applicable statutes provide otherwise. The Uniform Probate Code uses which modern term to refer to one who administers the decedent's estate regardless of whether the decedent died testate or intestate? - ANSWER-The Uniform Probate Code uses the term personal representative regardless of whether the decedent died testate or intestate. The term executor traditionally refers to the personal representative of a testate estate while Administrator refers to the personal representative of an intestate estate. A trustee does not administer a decedent's estate. According to Federal Rule of Civil Procedure 5.2(a) regarding redacted filings, an electronic or paper filing with the court that contains an individual's social security number should be redacted like: - ANSWER-The last four digits of the social-security number should be the only part included. Ted is 92 years old and is injured in a slip-and-fall due to a grocery store's negligence. He goes to the hospital, but the nurses commit malpractice, causing even more medical bills. Ted's Medicare benefits cover all his bills, but Ted still sues the grocery store and the hospital. Medicare intervenes in the lawsuit to assert its subrogation rights. What does this mean? - ANSWER-Subrogation is an action by a party, generally substituted for a real party in interest, to enforce a right. Generally an insurer (Medicare) will have a right to pursue a claim against a tortfeasor for damages paid to it's insured as a result of the tortfeasor's negligence. Maria rents a basement apartment from Sam. Sam refuses to reseal the walls and the basement floods every time it rains. Maria can't occupy the apartment during this time. Sam has breached: - ANSWER-The implied warranty of habitability. This warranty comes with every residential lease or rental agreement. The landlord must make the premises habitable. "The reversionary interest" deals with title to real property. "The theory of respondeat superior" is from Agency law. Dragon's Eye Capital, LP, is a limited partnership. A Dragon's Eye Capital limited partner loses his or her limited liability if he or she: - ANSWER-Acts as the firm's manager. Limited partners, by definition, have limited managing authority. A limited partner can be aware of the business activities without increasing their liability exposure. They may also invest where they want. Increasing their limited partnership shares only increases their liability but does not jeopardize their limited liability exposure. A limited liability partnership for doing business is - ANSWER-A partnership in which some or all of the parties have limited liability and one partner is neither responsible nor liable for another partner's misconduct What is the purpose of the Federal Rules of Civil Procedure? - ANSWER-The Federal Rules of Civil Procedure dictate court procedures for civil cases Under the traditional "M'Naghten Rule" for determining a defendant's insanity the following are considered: - ANSWER-Defendants are not legally responsible for their acts if due to a defect of the mind at the same time the crime was committed they were unable to understand the difference between right and wrong. Under the traditional M'Naghten rule, for an insanity defense to prevail, it must be shown that the defendant 1) did not know his act was wrong, and 2) did not understand the nature of his actions. Typically, states cannot be sued in federal court. Why not? - ANSWER-The Eleventh Amendment forbids unconsented suits against the states. States have complete sovereign immunity pursuant to the Eleventh Amendment. That immunity is not qualified in any way, nor is it dependent on state law. Some state courts do hear cases against states; but that fact is not responsive to the question (which asks about federal court, not state court) What's the difference between venue and jurisdiction? - ANSWER-Venue refers to the geographic location where a case is pending; jurisdiction is a court's authority to hear certain types of cases. The nature and scope of a court's authority is called jurisdiction. For example, some courts have jurisdiction to hear divorces, others have jurisdiction to hear criminal cases, and others have jurisdiction to hear patent disputes. For each different kind of court, there are usually several venues (localities) where the judges hear cases. So, for example, a jurisdictional choice would be whether to file a case in small claims court, circuit court, family court, juvenile court, etc. A venue determination, on the other hand, would be whether to file the case in Dallas, or Houston, or San Antonio. Which of the following is correct with regard to trusts? - ANSWER-A trust is an arrangement in which one party, the trustee, holds title to property for the benefit of another party, the beneficiary. In a trust, the settlor creates the trust and appoints a trustee to manage the trust property for the benefit of the beneficiaries of the trust. A federal tax-exempt nonprofit corporation will annually file the following: - ANSWER-IRS Form 990. IRS form 990 is annually required to be filed for a tax-exempt organization. If the nonprofit is not tax exempt, then it would file IRS form 1120 tax return and pay appropriate taxes. IRS form 8832 is a tax election form and IRS form 2553 is an election to be taxed as a small business corporation. A motion for summary judgment is a procedural device which permits the disposition of a case without going through trial. In order to prevail with a summary judgment motion, the moving party must prove: - ANSWER-There is no genuine issue of material fact remaining for trial. A motion for summary judgment is a dispositive motion that eliminates the need for the matter to proceed to a jury trial if the moving party can demonstrate there is no material issue of fact for the jury to hear and the moving party is entitled to the relief sought as a matter of law. In that event there is no need to submit the case to a trier of fact which leaves only issues of law to be decided by the judge without a trial. Which of the following crimes require specific intent? - ANSWER-Theft. Theft is an example of a specific intent crime because it requires proof not only that a defendant physically possessed an item, but also proof that the defendant specifically intended to permanently deprive the owner of the item. The term case law refers to: - ANSWER-Case law, or common law, is derived from judicial decisions where the court interprets the law and may decree what the law is when it has not been established by enacted law. Because a trial court decision may be appealed, it is not considered case law. Statutes and administrative regulations are created by the legislative and executive branches of government. In which type of deed does a grantor provide the most warranties and covenants with respect to the most claimants? - ANSWER-A general warranty deed includes warranties such as a covenant of the right to convey and a covenant of quiet enjoyment with respect to the claims of parties under the grantor and all of grantor's predecessors. A special warranty deed contains such warranties, but limits those warranties to parties who claim an interest in the real property under the grantor. A quit claim deed contains no warranties. A trustee's deed is used to convey title following a default under a deed of trust and contains no warranties. After the producing party notifies the receiving party of inadvertent production under the "clawback" provision of Federal Rule of Civil Procedure 26, the receiving party can: - ANSWER-Ask the court to review the information under seal for a determination of the claim. Federal Rule of Civil Procedure 26(b)(5)(B) states that if information produced in discovery is subject to a claim of privilege or of protection as trial-preparation material, the party making the claim may notify any party that received the information of the claim and the basis for it. After being notified, a party must promptly return, sequester, or destroy the specified information and any copies it has; must not use or disclose the information until the claim is resolved; must take reasonable steps to retrieve the information if the party disclosed it before being notified; and may promptly present the information to the court under seal for a determination of the claim. The producing party must preserve the information until the claim is resolved. A court that has the authority to hear a matter before any other court is within the: - ANSWER-Original jurisdiction. The court in the jurisdiction where the legal matter occurred will usually hear matters before any other court. John and Megan are not married, but they would like to buy a house together. They want to own their real estate in a way that if one of them dies, the other will inherit his or her share of the real estate automatically without going through probate. What type of deed should be prepared for them? - ANSWER-As joint tenants with the right of survivorship. A deed conveying real estate as a joint tenancy with the right of survivorship allows two or more people who are not married to own real estate together and if one dies, the surviving co-owner will inherit the real estate by operation of law (automatically) without the real estate passing through probate. A tenancy by the entirety can only be held by two people who were married at the time that the real estate was conveyed; a tenancy in common is a divided interest in real estate and the decedent's share passes to his or her beneficiaries or heirs, not the surviving co-owner; and a tenancy in severally is held by only one person. Shelby wants to sell her property known as Blackacre, but there are several issues with the title to the property. Which of the following does not represent a lien on title to Blackacre (assuming that all necessary documentation to perfect a lien has been filed with the local Recorder of Deeds' office)? - ANSWER-Shelby rented the property last year to Eric, and Eric's creditor obtained a judgment against him. As a tenant, Eric has no ownership interest in Blackacre, and therefore his creditor cannot place a judgment lien on the title to the property. A mortgage represents a lien on title as do unpaid property taxes. As a contractor who worked on the property, Ben has a mechanic's lien on the property. Gary Porter is a paralegal with the law firm of Harrolsen, Nichols & Carter. While driving to the courthouse one Tuesday afternoon to file papers in the clerk's office, Gary negligently ran a red light and collided with Harriet Anderson. Ms. Anderson's lawyer included Harrolsen, Nichols & Carter as a party in the complaint for damages. What is the doctrine of law which allows this? - ANSWER-Respondeat superior. Respondeat superior, a Latin phrase, translates as "let the superior respond." More specifically, respondeat superior means that an employer (the "superior") is liable (must "respond") for damages caused by an employee when the act of the employee which causes the damages occurs in the course of the employee's employment. Ziggy is adding blown-in insulation to his home. He rents a machine from Acme Rentals that shreds bales of insulation and blows it into the attic space through a large hose. While working, Ziggy's sleeve gets caught in the machine and his arm is pulled into the shredding apparatus. The "kill switch" or emergency stop is located on the opposite side of the machine and Ziggy cannot reach it. By the time help arrives and the machine is shut off, Ziggy suffered catastrophic trauma to his arm and it must be amputated. Ziggy sues Acme and the machine manufacture for this tort: - ANSWER-Products liability is a special area of negligence law which involves the liability of manufacturers, distributors and sellers of products to compensate users and buyers for injuries suffered because of defects in the goods. The underlying rule adopted in most jurisdictions is that the manufacturer is strictly liable in tort upon proof by an injured plaintiff of three prerequisites: 1) the existence of a design or manufacturing defect in the product; 2) a causal connection between the defect and the injuries suffered by the plaintiff; and 3) the defect in the product rendered it "unreasonably dangerous." In this scenario, the fact that the kill switch was located where the operator could not easily trigger it is a design defect that made the product unreasonably dangerous. ABC Sales, Inc. is a retail establishment incorporated in the State of Delaware. Which one of the following activities, if done in a state other than Delaware, would require ABC Sales, Inc. to register as a foreign corporation in that other state? - ANSWER-Open a store to sell products. A company incorporated in one state must register as a foreign corporation in any other state in which it "transacts business." Opening a store and selling products constitutes "transacting business" and would require ABC Sales, Inc. to register as a foreign corporation. All the others are not activities that would be considered to be "transacting business" and therefore would not require foreign registration. A representative's deed is typically used in connection with which event? - ANSWER-Death of a real property owner. Real property included in a decedent's estate is conveyed to an heir or a third-party purchaser pursuant to a representative's deed. Real property sold pursuant to a sale for delinquent taxes is conveyed by a tax deed. A sheriff's deed is used to transfer title following foreclosure on a mortgage. A general warranty deed or special warranty deed is used by a real property owner to convey title from a real property owner to a third party paying fair market value. In which deed covenant does a grantor warrant that she will defend the grantee's right to enjoy the real property against the claims of third parties? - ANSWER-Covenant of warranty. Although the grantor covenants that the grantee will be able to enjoy the real property against the claims of third parties through a covenant of quiet enjoyment, it is through the covenant of warranty that the grantor covenants to defend the grantee's title against such claims of third parties. The covenants of seisen and against encumbrances are present covenants wherein the grantor warrants that she has possession and ownership of the real property and that there are no encumbrances affecting the property, respectively. Strict liability: - ANSWER-Can apply when the defendant is neither negligent nor had any intent to do the wrongdoing. Strict liability does not require that the defendant intended the act or was negligent. Strict liability does apply to products liability cases but can also apply to other cases as well, like inherently dangerous activities. Who has a right to receive dividends? - ANSWER-Preferred shareholders at all times, and common shareholders whenever dividends have been declared. Preferred stock pays dividends according to the schedule set by the corporation. Even if there is no profit, dividends are still due to preferred shareholders. No shareholder is entitled to dividend at all times. Dividends are not declared for preferred stock as these are paid on a schedule.