Fact Pattern 3-2 Ellen Contracts with James to Be Her Stockbroker, Making Stock

question 91

Multiple Choice

Fact Pattern 3-2
Ellen contracts with James to be her stockbroker, making stock trades for Ellen's account. Ellen need not pre-approve the trades that James makes, only trades for more than $20,000. Ellen and James include a clause stating "that in case of any disputes arising out of this contract; the dispute shall be arbitrated using the rules of the New York Stock Exchange."
Ellen learns that since signing her contract with James, he has routinely been making trades worth more than $20,000 without her permission, and losing money.
-Refer to Fact Pattern 3-2. Assume that Ellen sees James' unauthorized actions as the basis for a legal dispute. If she arbitrates, what must she do first?

• A) file a complaint
• B) file an answer
• C) file a submission
• D) file a reverter
• E) file a rejoinder

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Definitions:

Liquidation

The process of converting assets into cash or paying off liabilities in order to close down a business.

Liquidations

The process of winding up a company's financial affairs by selling off assets to pay creditors and distribute any remaining assets to shareholders.

Calls in Advance

Funds received by a company from its shareholders before they are actually called for, typically for the issue of shares.

Voluntary Winding Up

The process initiated by a company's shareholders to voluntarily dissolve the company and liquidate its assets for distribution.