Liabilities Self-Quiz
Wanda, as
the trustee for an apartment building, held in trust for her nephew, Taylor,
signed a renewal contract with the management company that manages the
building. She signed the contract: “Wanda O’Donnell, Trustee.”
Wanda is personally liable on the contract?
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Wesley, as
co-trustee of a trust, continues to operate the settlor’s business,
a retail store. A shopper is injured at the store because of negligence
of an employee. Who is liable for the shopper’s injury?
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Asa is the
trustee of a trust that contains negotiable securities in trust for Carla
and Jeffery. For safekeeping, Asa placed the securities in a safe deposit
box at the most prominent bank in town. One night burglars break into
the bank and steal the securities. Asa is personally liable for this loss.
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Misty is the
trustee of $60,000 for Tabitha for life and then for Ileana, which Misty
has invested at 3% interest. For many years Misty, who lives in Portland,
OR, has been sending a regular monthly check for $150 to Tabitha, who
lives in Seattle, WA. Tabitha dies but Misty does not find out about her
death. Meanwhile, Misty continues to send the checks, which are cashed.
Misty never looks at the returned checks in her bank statement; otherwise,
she would have discovered that the endorsements were forgeries. This continues
for three years after Tabitha’s death. Who was entitled to those
checks?
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