Question 1

Use the fact situation in Q4 to answer the related question that follows. In the event that the Canadian court cannot determine which law will apply from the intention of the parties,it will

Accepted Answer

When a court cannot determine which law will apply from the intention of the parties, it will typically apply the law of the country most connected to the contract. This is known as the "proper law" or "governing law" of the contract. This approach is favored because it promotes predictability and consistency in resolving cross-border disputes. In this case, since the contract was between a Canadian company and a French company, and the performance of the contract was to take place in France, it is likely that the law of France would be the proper law of the contract.

Question 2

A,based in Canada,has a contract with B,in Denmark,for the sale by A to B of certain goods.The contract specifies that A bears responsibility for shipping the goods and for insuring them.In this case,A and B have entered into

Accepted Answer

A CIF (Cost, Insurance, and Freight) contract specifies that the seller (A) is responsible for arranging and paying for the shipping and insurance of the goods to the buyer's (B) destination. This matches the scenario described.

Question 3

A buyer in British Columbia purchases equipment from a manufacturer in China.The contract between the parties stipulates that any dispute between the parties arising out of the transaction will be decided by an arbitrator in Switzerland.The buyer is not satisfied with the quality of the equipment and brings the dispute before an arbitrator in Switzerland.What law will the arbitrator apply to resolve the dispute?

Accepted Answer

The law that the parties agreed should apply will be the law that the arbitrator applies to resolve the dispute, as stated in the contract. In this case, the contract stipulated that any dispute will be decided by an arbitrator in Switzerland, so it is likely that the parties agreed that Swiss law should apply.

Question 4

An export sale normally requires at least

Accepted Answer

An export sale typically involves several key documents to ensure the transaction is properly recorded, legal, and that the goods are shipped and insured correctly. These documents include the insurance policy or certificate to protect against loss or damage during transport, the contract of sale which outlines the terms and conditions of the sale, the bill of lading which serves as a receipt for the shipped goods and a document of title, and the invoice which details the products sold and the amount due. Therefore, all of the options listed are required for an export sale.

Question 5

A,based in Canada,enters into a contract for the sale of goods to B in Germany.The contract provides that A is to make the goods available to B at A's own warehouse.In this case,the arrangement between A and B is

Accepted Answer

The arrangement between A and B is an EXW (ex works) contract, which means A is only responsible for making the goods available at their own warehouse and B is responsible for all further transportation and costs. None of the other options apply as they involve different responsibilities and delivery locations.

Question 6

Use the fact situation in Q12 to answer the related question that follows. If A institutes an action in Ontario against B,what argument(s)will B most likely raise to transfer the action to Geneva to be heard by a Swiss court?

Accepted Answer

B could raise all of the arguments listed to transfer the action to Geneva, as they all relate to the convenience and relevance of Geneva as the forum for the dispute. The cost of bringing parties from Geneva, the location of the majority of the parties, the negotiations being held in Geneva, and the manufacturing plant being in Geneva are all relevant factors that may support transferring the action to a Swiss court.

Question 7

When we speak of foreign presence,we mean that

Accepted Answer

The definition of foreign presence specifically mentions establishing an agent or representative office in a foreign country, which matches with choice E. The other choices do not fit the definition as closely, as they either involve investment, relocation, or acquisition, but not necessarily the establishment of a physical presence in a foreign country.

Question 8

Unlike domestic contracts,international contracts are more likely to involve special problems,such as

Accepted Answer

International contracts often involve issues related to transportation, insurance, and financing due to the distance involved and the need to deal with different legal and regulatory systems. Carriers, insurers, and banks may also be involved in international contracts, but this is not unique to them. Interference from foreign governments can also be a problem, but this is not always the case. The buyer-seller language barrier may be an issue, but it is not specific to international contracts. Export houses and freight forwarders may also be involved, but this is not a special problem.

Question 9

Use this fact situation to answer the related questions that follow. A,based in Ontario,enters into a contract with B,in Geneva,Switzerland,whereby B will manufacture and supply to A a certain quantity of watches.The negotiations first took place by faxes between Ontario and Geneva and were then held in person in Geneva.Most of the people connected with the negotiations and the contract live in Geneva and B's manufacturing plant is there.B manufactures the watches and then delivers them to A in Ontario.However,A refuses to accept them because they do not meet the specifications agreed on.There is a marked absence of the actual specifications in the contract,and it also does not contain a jurisdiction clause in the event of a dispute.Having rejected the delivered goods,A now goes out and buys the watches from a German manufacturer at twice the cost of the Swiss watches.
In this case,under Ontario law,A can institute an action in Ontario against B because

Accepted Answer

A can institute an action in Ontario against B because A suffered damages in Ontario. The jurisdiction is based on the principle of where the harm occurred. A's rejection of the delivered goods and subsequent purchase of watches at a higher cost resulted in a financial loss that took place in Ontario.

Question 10

The best means of establishing the proper law for an international contract is

Accepted Answer

The best means of establishing the proper law for an international contract is for the parties themselves to make express provision. This ensures that both parties have agreed to the same law, minimizing the risk of disputes arising later on. It also provides more certainty and predictability in the event of a dispute as it eliminates the need for the parties to argue over which law should be applied.

Question 11

Use this fact situation to answer the related questions that follow. A company in Canada has just entered into a contract for the sale of goods to a company in France; however,the contract is silent as to the law that will apply.
In this case,in the event of a dispute,a Canadian court will look at

Accepted Answer

When a contract is silent as to which law applies, the court must look at the intention of the parties, which can be inferred from the circumstances of the contract. In this case, the fact that the parties are located in different countries suggests that they may have intended for the law of one of their countries to apply. Therefore, the court will look at the intention of the parties to determine which law should apply.

Question 12

Foreign investment occurs when

Accepted Answer

The answer of Foreign investment occurs when
...

Question 13

In commercial arbitration,

Accepted Answer

All of the above options are correct. In commercial arbitration, the parties agree to resolve their dispute using this method, and the arbitration is typically presided over by an experienced arbitrator. The arbitrator's decision will bind the parties, and in most cases, it can be easily enforced.

Question 14

A,based in Canada,agrees to sell goods to B in Australia.The contract provides that B will manage shipment of the goods and A will deliver the goods to and load them on a carrier designated by B.In this case,A and B have entered into

Accepted Answer

The contract between A and B is an FOB (Free On Board) contract. This is because A is responsible for delivering and loading the goods onto a carrier, and the ownership of the goods transfers to B once they are loaded onto the carrier. B is responsible for managing the shipment of the goods from that point onwards.

Question 15

Use the fact situation in Q4 to answer the related question that follows. When the Canadian court cannot determine which law will apply from the intention of the parties,among other things,the court will consider

Accepted Answer

The Canadian court will consider all of the factors listed in determining which law will apply. The place of business of the parties, the place of acceptance of the risk, where the contract was to be performed, and where the contract was made are all relevant factors to consider.

Question 16

Use the fact situation in Q12 to answer the related question that follows. The principle of law that allows a party to request a change of court of trial when it results in undue hardship is

Accepted Answer

The principle of law that allows a party to request a change of court of trial when it results in undue hardship is known as forum non conveniens. This principle allows a court to decline jurisdiction over a case when another court is more appropriate and convenient for the parties and witnesses involved.

Question 17

A large Korean car manufacturer has just built a new model car which it is going to sell in Canada.In Korea the car will be sold for the Canadian equivalent of $25 000.00 but to get into the market in Canada the car will be sold for $15 900.00 Canadian.In this case,the company has engaged in

Accepted Answer

The company is selling the car in Canada below the cost it would be sold for in Korea, which is known as dumping. This is often done to gain market share and undercut competitors.

Question 18

International business transactions require,by definition,parties in

Accepted Answer

International business transactions involve parties located in different countries, hence requiring dealings between two or more different countries.

Question 19

A large multinational Canadian manufacturing company has just bought a majority of shares in a similar company located in Spain.This is an example of

Accepted Answer

The multinational Canadian manufacturing company is buying a majority of shares in a similar company located in Spain, which qualifies as a direct foreign investment. A direct foreign investment occurs when a company invests in or owns a company in a foreign country, such as buying a majority of shares in a Spanish company.

Question 20

Public international law is

Accepted Answer

Public international law, also known as the law of nations, is concerned with the legal relationships between states. It governs the conduct of states, international organizations, and other entities in their relations with one another. The other answer choices may be aspects of public international law, but the main focus is on the legal relationships between states.

Quiz 31: International Business Transactions