BUL 3320 Exam 3 Questions with 1005
Correct Answers
Specific Performance - Answer-A remedy that orders the breaching party to perform the acts promised
in the contract.
Usually awarded in cases in which the subject matter is unique.
Contracts involving land, heirlooms, and paintings.
Mitigation of Damages - Answer-A non-breaching party's legal duty to avoid or reduce damages caused
by a breach of contract.
Liquidated Damages - Answer-Damages that parties to a contract agree in advance should be paid if the
contract is breached.
Nominal Damages - Answer-Damages awarded when the non-breaching party sues the breaching party
even though no financial loss has resulted from the breach.
Usually $1 or some other small amount.
Injunction - Answer-A court order that prohibits a person from doing a certain act.
The requesting party must show that he/she will suffer irreparable injury if it is not issued.
,Automatic Stay - Answer-The suspension of certain legal actions by creditors against a debtor or the
debtor's property.
Fraudulent Transfer - Answer-A transfer of a debtor's property or an obligation incurred by a debtor
within two years of the filing of a petition, where (1) the debtor had actual intent to hinder, delay, or
defraud a creditor or (2) the debtor received less than a reasonable equivalent in value.
Bankruptcy Trustee - Answer-A legal representative of the debtor's estate.
May be appointed in reorganization case upon a showing of fraud, dishonesty, incompetence, or gross
mismanagement of the affairs of debtor by current management.
Chapter 11--Reorganization of Bankruptcy Code - Answer-A method that allows reorganization of the
debtor's financial affairs under the supervision of the bankruptcy court.
Often in the best interest of the debtor and its creditors.
Debtor Exemptions - Answer-Exempt Property, Federal Exemptions, State Exemptions, and Homestead
Exemptions.
Domestic Support Obligations - Answer-A debt that accrues before, on, or after the date of the order for
relief in a case, including interest that accrues on that debt as provided under applicable non-bankruptcy
law.
Generally child support or alimony.
When is a Bankruptcy Trustee appointed? - Answer-May be appointed in Chapter 7 (liquidation),
Chapter 12 (family farmer/fisherman), Chapter 13 (adjustment of debt) or Chapter 11 (reorganization).
Involuntary Petitions - Answer-A petition filed by creditors of a debtor that alleges that the debtor is not
paying his/her debts as they become due.
Can be filed in Chapter 7 (liquidation) and Chapter 11 (reorganization).
, US Bankruptcy Courts - Answer-Special federal courts that hear and decide bankruptcy cases.
Bankruptcy Attorney Certification - Answer-Must certify the accuracy of the information contained in
the bankruptcy petition and schedules, under penalty of perjury.
Pre/Post-Petition Counseling - Answer-Pre-petition: Must receive counseling within 180 days prior to
filing his/her petition for bankruptcy.
Post-petition: Before an individual debtor receives a discharge, the debtor must attend a personal
financial management course approved by the US Trustee.
Homestead Exemptions - Answer-Equity in a debtor's home that the debtor is permitted to reatain.
Means Test - Answer-A bankruptcy rule that applies to a debtor who has a median family income that
exceeds the state's median family income for families the same size as the debtor's family.
A debtor in this category qualifies for Chapter 7 bankruptcy if he has disposable income below an
amount determined by bankruptcy law but does not qualify for Ch. 7 bankruptcy if he has disposable
income above an amount determined by bankruptcy law.
2005 Act's Changes to Chapter 7 - Answer-Make it more difficult to for individual debtors to qualify.
Abusive filing: a Ch. 7 filing that is found to be an abuse of Ch. 7 liquidation bankruptcy.
The court can dismiss the case or convert the case to a CH. 13 or 11 proceeding, with the debtor's
consent.
Individual with Regular Income - Answer-An individual whose income is sufficiently stable and regular to
enable the individual to make payments under a Chapter 13 plan.
Correct Answers
Specific Performance - Answer-A remedy that orders the breaching party to perform the acts promised
in the contract.
Usually awarded in cases in which the subject matter is unique.
Contracts involving land, heirlooms, and paintings.
Mitigation of Damages - Answer-A non-breaching party's legal duty to avoid or reduce damages caused
by a breach of contract.
Liquidated Damages - Answer-Damages that parties to a contract agree in advance should be paid if the
contract is breached.
Nominal Damages - Answer-Damages awarded when the non-breaching party sues the breaching party
even though no financial loss has resulted from the breach.
Usually $1 or some other small amount.
Injunction - Answer-A court order that prohibits a person from doing a certain act.
The requesting party must show that he/she will suffer irreparable injury if it is not issued.
,Automatic Stay - Answer-The suspension of certain legal actions by creditors against a debtor or the
debtor's property.
Fraudulent Transfer - Answer-A transfer of a debtor's property or an obligation incurred by a debtor
within two years of the filing of a petition, where (1) the debtor had actual intent to hinder, delay, or
defraud a creditor or (2) the debtor received less than a reasonable equivalent in value.
Bankruptcy Trustee - Answer-A legal representative of the debtor's estate.
May be appointed in reorganization case upon a showing of fraud, dishonesty, incompetence, or gross
mismanagement of the affairs of debtor by current management.
Chapter 11--Reorganization of Bankruptcy Code - Answer-A method that allows reorganization of the
debtor's financial affairs under the supervision of the bankruptcy court.
Often in the best interest of the debtor and its creditors.
Debtor Exemptions - Answer-Exempt Property, Federal Exemptions, State Exemptions, and Homestead
Exemptions.
Domestic Support Obligations - Answer-A debt that accrues before, on, or after the date of the order for
relief in a case, including interest that accrues on that debt as provided under applicable non-bankruptcy
law.
Generally child support or alimony.
When is a Bankruptcy Trustee appointed? - Answer-May be appointed in Chapter 7 (liquidation),
Chapter 12 (family farmer/fisherman), Chapter 13 (adjustment of debt) or Chapter 11 (reorganization).
Involuntary Petitions - Answer-A petition filed by creditors of a debtor that alleges that the debtor is not
paying his/her debts as they become due.
Can be filed in Chapter 7 (liquidation) and Chapter 11 (reorganization).
, US Bankruptcy Courts - Answer-Special federal courts that hear and decide bankruptcy cases.
Bankruptcy Attorney Certification - Answer-Must certify the accuracy of the information contained in
the bankruptcy petition and schedules, under penalty of perjury.
Pre/Post-Petition Counseling - Answer-Pre-petition: Must receive counseling within 180 days prior to
filing his/her petition for bankruptcy.
Post-petition: Before an individual debtor receives a discharge, the debtor must attend a personal
financial management course approved by the US Trustee.
Homestead Exemptions - Answer-Equity in a debtor's home that the debtor is permitted to reatain.
Means Test - Answer-A bankruptcy rule that applies to a debtor who has a median family income that
exceeds the state's median family income for families the same size as the debtor's family.
A debtor in this category qualifies for Chapter 7 bankruptcy if he has disposable income below an
amount determined by bankruptcy law but does not qualify for Ch. 7 bankruptcy if he has disposable
income above an amount determined by bankruptcy law.
2005 Act's Changes to Chapter 7 - Answer-Make it more difficult to for individual debtors to qualify.
Abusive filing: a Ch. 7 filing that is found to be an abuse of Ch. 7 liquidation bankruptcy.
The court can dismiss the case or convert the case to a CH. 13 or 11 proceeding, with the debtor's
consent.
Individual with Regular Income - Answer-An individual whose income is sufficiently stable and regular to
enable the individual to make payments under a Chapter 13 plan.
