Solicitor Bar Exam Questions and Correct Answers Latest Update (Graded A+)

Solicitor Bar Exam Questions and Correct Answers Latest Update (Graded A+) Upon reviewing a list of beneficiaries for an estate what relationship pose a potential conflict? - Answers A current client of the firm in a separate matter. A client demands an answer on short notice about how a recent court decision will impact their ongoing lawsuit on a similar issue. - Answers A lawyer should advise the client in writing that a proper opinion cannot be rendered within the designated timeframe. A real estate lawyer who is acting for purchaser and lender learns of an addendum to the price. What must the lawyer do? - Answers The lawyer in a joint retainer must provide a copy of any changes provided by one party to the other party. If a conflict arises the lawyer must withdraw from representing both parties. To whom can a private corporation issue its shares within the exemption from registration and prospectus. - Answers A private corporation may issue shares to current or former directors or current officers of the corporation only. Your client is the director of a family corporation who is having marital difficulties. They want you to terminate their husband's employment with the corporation. What action should you take? - Answers The lawyer should advice the client that only the board of directors can terminate an employee and that the lawyer can represent the corporation only with instructions from the board of directors. A lawyer is on joint retainer in a complex real estate transaction when one of the clients states they will be the only one on title. Who must the lawyer contact? - Answers The lawyer must receive instructions from all parties in the joint retainer and the lender before altering title documents. Can a lawyer represent the purchaser and lender in a single transaction if the lender is an unrelated, private person? - Answers No if the loan is for more than $50,000 and the lender is not a registered lender. what is the best advice a lawyer could give his client to manage their expectations in respect to a proposed offer to extend a closing in a real estate matter? - Answers when a party requests an extension so they may fulfill their obligations under an agreement to purchase and sale the lawyer should advice the client counter offer with realistic timelines and a responsibility for costs. What is satisfactory evidence that the legal use of a property is accurate according to intended use. - Answers Only confirmation from the appropriate municipal authority is satisfactory evidence of legal use. If the client in a joint retainer asks a lawyer to change the legal use of the property they are purchasing is this a new retainer? - Answers A new retainer must be signed if the client changes the action or subject matter of the issue. Smith conveyed parcel B to Jones with consent under the planning act. Jones then mortgaged Parcel B to his bank without a consent. Is this a valid transaction? - Answers The conveyance to Jones and the mortgage to the bank are valid as a consent to convey was obtained, s. 50.12 states once a consent always a consent, s.50.3.f the mortgage is subsequent dealing for the identical parcel where a consent was obtained. smith mortgaged Parcel B to his bank with a consent under the Planning Act and then Smith conveyed Parcel B to Jones without consent. Is this a valid transaction? - Answers The mortgage to the bank is valid as a consent to mortgage was obtained. The conveyance to Jones is not valid. s.50.3.f the conveyance was a subsequent action but the consent was to mortgage and not convey. Jones conveys parcel c to Smith who in turn gives a vendor take back mortgage to Jones for the purchase price. - Answers Jones does not own the abutting land so the vendor take back mortgage from Smith to Jones is valid, s.50.8 provides that Vendor take back mortgages do not fall within the basic prohibition of s.50.3 What is the minimum number of directors for a newly incorporated company with 2 shareholder/owners? - Answers only 1 director is required if the corporation is not an offering or public corporation. A CCPC can pay an eligible dividend to the extent it has a sufficient general rate income pool. - Answers Yes A shareholder is unhappy with the name of the corporation and would like to propose to amend the name. Who must approve the proposal? - Answers Two-Thirds of the shareholders voting on a specific matter must agree by vote to a change in name proposal. How may a corporate seller exercise an unpaid seller's lien on a defaulting corporation? - Answers By giving notice to an affiliate of the buyer. How may a corporation be dissolved? - Answers A corporation may be dissolved by court order, breach of statutory provisions, or resolution of a majority of shareholders. A private corporation with 50 outstanding shares would like to redeem 25 shares at $10 per share. The PUC is $4 per share and the ACB is $5 per share. What would the income tax impact be on the purchaser for the redemption? - Answers The shareholder recognizes a deemed dividend of $150 and a capital loss of $25. What is the best method to perfect a security interest when dealing with investment property? - Answers The best method to perfect a security interest is control in the direct holding system. how may a sole limited partner NOT be able to dissolve the limited partnership? - Answers by giving notice that the limited partnership was created for a defined number of years. When would an asset sale be preferable? - Answers An asset sale is preferable if the corporation is CCPC qualified and earning an active business income. A young lawyer in Thunder Bay is asked to draft a Will. Who do they ow a duty to? - Answers The estate lawyer owes a duty to the testator and the clients beneficiaries. A deceased failed to provide for biological son in Will. How would his son make a claim under Part V of the SLRA? - Answers To make a claim under Part V of the SLRA the beneficiary must show the testator was under duress when making their Will. A lawyer is asked to draft a Will for a hospitalized person by their spouse. What should the lawyer do? - Answers A lawyer has an obligation to obtain instructions directly from the testator and to determine capacity of the testator prior to drafting a Will When advising a spouse regarding their interest in a Will a lawyer should explain they may be entitled to what benefit? - Answers A spouse is entitled to an equalization payment if the spouse does not gift 100% of their estate. A testator owned his home valued at $200,000 and RRSP's with no beneficiary, valued at $20,000. What is the amount of estate administration tax payable in probate? - Answers $5 per $1000 for estates under $50,000; $15 per $1000 for estates over $50,000. A bank accepts a power of attorney and relies on its validity when releasing funds to the attorney however the power of attorney has been revoked. Who has liability for the $5000 taken? - Answers the bank is protected by s.13 of the SDA when honouring a POA which they have not received notice of revocation for. Upon death a joint tenancy is owned by whom, the estate of the deceased or the joint tenant-if different? - Answers the impact of the death of one joint owner may still leave beneficial ownership of some or all of the property in the estate of the deceased joint owner What property categories are excluded from the calculation of estate administration tax? - Answers Real property outside of Ontario is not considered in estate administration tax. When does a continuing power of attorney become effective? - Answers a continuing power of attorney becomes effective depending on the terms outlined in the document and remains active after incapacity. When would a 16 year old living in Toronto who is a student and employee be capable of signing a continuing power of attorney? - Answers a grantor of a POA for property must be capable of understanding their assets and obligations to dependants and the value of their assets. 18 is generally understood to be age of capacity but is not required for signing a POA. BIA - Answers Bankruptcy and Insolvency Act What is a difference between an asset acquisition and a share acquisition? - Answers A share acquisition generally does not disturb existing pension and benefit plans but an asset