Sample Questions
Question 1
Easy
Under agency law, when is a principal liable for the torts committed by an agent?
Solution
B is correct.
Under the doctrine of respondeat superior, a principal (employer) is vicariously liable for torts committed by an employee-agent who is acting within the scope of employment. This vicarious liability arises because the employer has the right to control the manner and means of the employee's work. Generally, a principal is not liable for torts committed by independent contractors, because the principal does not control the method of the independent contractor's work (though exceptions exist for inherently dangerous activities and nondelegable duties).
Under the doctrine of respondeat superior, a principal (employer) is vicariously liable for torts committed by an employee-agent who is acting within the scope of employment. This vicarious liability arises because the employer has the right to control the manner and means of the employee's work. Generally, a principal is not liable for torts committed by independent contractors, because the principal does not control the method of the independent contractor's work (though exceptions exist for inherently dangerous activities and nondelegable duties).
Question 2
Medium
Which of the following debts is dischargeable in a Chapter 7 bankruptcy proceeding?
Solution
Ordinary unsecured consumer debt, such as a credit card balance for routine living expenses, is the classic example of a dischargeable obligation in Chapter 7. The other three are statutorily nondischargeable: recent income taxes (those for which the return was due within three years pre-petition), domestic support obligations (alimony and child support), and debts arising from willful and malicious injury to a person or property all survive a Chapter 7 discharge under Section 523.
Question 3
Hard
Debtor is filing for Chapter 7 bankruptcy. Which of the following actions by a creditor is permitted notwithstanding the automatic stay imposed under Section 362?
Solution
The automatic stay halts virtually all creditor collection activity (lawsuits, repossession, dunning calls, lien enforcement) the moment the petition is filed. However, Section 362(b) lists express exceptions, and CRIMINAL proceedings against the debtor are exempt. The bankruptcy system stops debt collection but does not shield a debtor from prosecution for crimes. Other notable exceptions: domestic support actions, certain tax assessments, and police/regulatory actions. Continuing a civil collection suit, repossessing collateral, and making collection phone calls are all classic stay violations subject to sanctions.
