Question 1

Regardless of the language of the contract,title to goods passes to the buyer at the time and place at which the seller physically delivers the goods.

Accepted Answer

A) True 
 B)False  False

Question 2

Marco Manufacturing contracted to sell Kurtz Industries 3,000 iron clasps.The contract specified: F.O.B.Kurtz Industries.Upon arrival and inspection,the goods were rejected by Kurtz Industries because they did not conform to the contract specifications.In transit back to Marco Manufacturing,the common carrier's truck overturned and completely destroyed the clasps.Which statement is correct?

Accepted Answer

A) Marco may sue Kurtz for the contract price,as risk of loss transferred to Kurtz at the F.O.B.point. 
B) Kurtz will not be liable for the purchase price.The risk of loss had not yet transferred since the goods were nonconforming. 
C) The loss will be split between the parties on a 50/50 basis. 
D) The loss will be assigned to the party who can best bear the loss. 
A) Marco may sue Kurtz for the contract price,as risk of loss transferred to Kurtz at the F.O.B.point. 
B) Kurtz will not be liable for the purchase price.The risk of loss had not yet transferred since the goods were nonconforming. 
C) The loss will be split between the parties on a 50/50 basis. 
D) The loss will be assigned to the party who can best bear the loss. B

Question 3

Inez contracted with Filippo Furnaces Co.for the installation of a new furnace.Inez selected the furnace she wanted,accepting no suggestions from Filippo Furnaces' heating engineer.The furnace operated fine,but it did not heat the entire house.The size of the blower on the furnace was too small to accommodate the third floor of the house.Inez sued Filippo Furnaces Co.for the breach of the implied warranties of merchantability and fitness.What result?

Accepted Answer

Inez will lose under both implied warranties.The implied warranty of merchantability was not breached because the furnace was operating according to the standards of the heating industry.The implied warranty of fitness was likewise not breached.This warranty requires the seller to know of the buyer's particular purpose and that the buyer is relying on the seller's skill or judgment in recommending a particular product.Here Inez did not ask for or receive any suggestions from the seller or the seller's expert.

Question 4

Leonardo fraudulently obtained a piece of jewelry from Jessica.He then sold the piece to Midori,who did not know about the fraud.Which of the following describes the situation?

Accepted Answer

A) Leonardo had voidable title and Midori gets a void title. 
B) Leonardo had void title and Midori gets good title. 
C) Leonardo had voidable title and Midori gets good title. 
D) Leonardo had good title and Midori gets good title. 
A) Leonardo had voidable title and Midori gets a void title. 
B) Leonardo had void title and Midori gets good title. 
C) Leonardo had voidable title and Midori gets good title. 
D) Leonardo had good title and Midori gets good title.

Question 5

In a shipment contract,the risk passes to the buyer when the goods are properly tendered at the destination point.

Accepted Answer

A) True 
 B)False

Question 6

On impulse,you purchase a travel trailer and ask your acquaintance,Max,if you can leave the trailer at the edge of his restaurant's parking lot until you can have a concrete pad built to store the trailer on your property.Max agrees.When you return for the trailer the next week,it is gone and you find out that Max sold it.You can

Accepted Answer

A) recover the trailer because Max did not have any ownership interest to pass. 
B) recover,but only if Max bought insurance to cover the trailer while it was on his property. 
C) not recover because you "entrusted" the trailer to Max,who then had a right to sell it. 
D) not recover because Max had only a voidable title to transfer. 
A) recover the trailer because Max did not have any ownership interest to pass. 
B) recover,but only if Max bought insurance to cover the trailer while it was on his property. 
C) not recover because you "entrusted" the trailer to Max,who then had a right to sell it. 
D) not recover because Max had only a voidable title to transfer.

Question 7

Mason bought a rotisserie in preparation for a party he was planning.When he put a chicken on the rotisserie,it would not rotate,but stayed in one position where it burned the chicken on one side and left it raw on the other.When he returned the rotisserie to the store,the salesperson disclaimed any responsibility because he had never told Mason the rotisserie would rotate the food as it cooked.Does Mason have any recourse?

Accepted Answer

A) No,the salesperson did not make any express warranties. 
B) Yes,the salesperson made an express warranty just by selling the goods. 
C) Yes,although the salesperson did not make any express warranties,the UCC imposes an express warranty on the sale. 
D) Yes,although the salesperson did not make any express warranties,the UCC imposes an implied warranty of merchantability under which the rotisserie is guaranteed to be fit for the ordinary purposes for which it is used. 
A) No,the salesperson did not make any express warranties. 
B) Yes,the salesperson made an express warranty just by selling the goods. 
C) Yes,although the salesperson did not make any express warranties,the UCC imposes an express warranty on the sale. 
D) Yes,although the salesperson did not make any express warranties,the UCC imposes an implied warranty of merchantability under which the rotisserie is guaranteed to be fit for the ordinary purposes for which it is used.

Question 8

If shipping terms are C&F,then

Accepted Answer

A) the price includes,in a lump sum,the cost of the goods and freight,but not insurance. 
B) the price includes,in a lump sum,the cost of the goods and the insurance and freight to the named destination. 
C) neither the buyer nor the seller bears risk;the shipping company bears all risk. 
D) the seller bears all risk until goods are in the carrier's possession;then the buyer bears the risk. 
A) the price includes,in a lump sum,the cost of the goods and freight,but not insurance. 
B) the price includes,in a lump sum,the cost of the goods and the insurance and freight to the named destination. 
C) neither the buyer nor the seller bears risk;the shipping company bears all risk. 
D) the seller bears all risk until goods are in the carrier's possession;then the buyer bears the risk.

Question 9

Mike sold his car to Beth,who was to pick the car up at Mike's house and pay for it then.In fact,when Beth arrived,she discovered Mike's home and the car destroyed by a fire the night before.The risk of loss falls on

Accepted Answer

A) Mike because Beth had not taken possession of the car. 
B) Beth because Mike was ready,willing,and able to tender the car. 
C) Beth because under the UCC,the buyer bears the risk of loss. 
D) Mike,because as a merchant he is responsible for the car. 
A) Mike because Beth had not taken possession of the car. 
B) Beth because Mike was ready,willing,and able to tender the car. 
C) Beth because under the UCC,the buyer bears the risk of loss. 
D) Mike,because as a merchant he is responsible for the car.

Question 10

Mark,a power tool salesman,promises Jill,a customer,that the Turbo Power Hedge Trimmer 1000 will easily cut through bamboo up to 3 inches thick.Mark's statement constitutes an express warranty if Jill purchases the hedge trimmer.

Accepted Answer

A) True 
 B)False

Question 11

A contract that requires a seller to deliver goods to the carrier is a

Accepted Answer

A) destination contract. 
B) shipment contract. 
C) C.I.F.contract. 
D) C.O.D.contract. 
A) destination contract. 
B) shipment contract. 
C) C.I.F.contract. 
D) C.O.D.contract.

Question 12

Crops are considered identified when they are planted.

Accepted Answer

A) True 
 B)False

Question 13

The UCC looks solely upon "title" to determine ownership in goods.

Accepted Answer

A) True 
 B)False

Question 14

Tuan,Inc.contracted to buy 200 monogrammed blankets from Titex,Inc.Before Titex segregated and monogrammed the blankets,Tuan filed for bankruptcy.Tuan does not own title to the blankets because

Accepted Answer

A) Tuan is a merchant. 
B) the blankets were not identified to the contract. 
C) Tuan became bankrupt after the contract was formed. 
D) the goods were specially manufactured. 
A) Tuan is a merchant. 
B) the blankets were not identified to the contract. 
C) Tuan became bankrupt after the contract was formed. 
D) the goods were specially manufactured.

Question 15

Only one party can have an interest in particular goods at a particular time.

Accepted Answer

A) True 
 B)False

Question 16

If a seller includes an express warranty in the written sales contract,any disclaimer is invalid.

Accepted Answer

A) True 
 B)False

Question 17

Discuss the concept of insurable interest.Indicate the difference between a buyer's and a seller's insurable interest.

Accepted Answer

Closely related to identification and ti

Question 18

In January,Eddie contracts to sell 100 bushels of soybeans in the fall.This contract

Accepted Answer

A) is void.He cannot contract to sell a crop before it is even planted;the goods must be in existence. 
B) is void.The soybeans must be identified to the contract at the time he contracts to sell them. 
C) can be valid,but title to the soybeans cannot pass until the soybeans exist. 
D) can be valid,and title to the soybeans passes when the contract is signed. 
A) is void.He cannot contract to sell a crop before it is even planted;the goods must be in existence. 
B) is void.The soybeans must be identified to the contract at the time he contracts to sell them. 
C) can be valid,but title to the soybeans cannot pass until the soybeans exist. 
D) can be valid,and title to the soybeans passes when the contract is signed.

Question 19

A sales representative at Oxtren,Inc.orally tells the purchasing agent at Wety,Inc.that its industrial saw is exceptional.Which statement is correct concerning the claim that the saw is exceptional?

Accepted Answer

A) The claim is an express warranty. 
B) The claim is an implied warranty of merchantability. 
C) The claim is not a warranty because it is not in writing. 
D) The claim is not a warranty because it is sales puffery. 
A) The claim is an express warranty. 
B) The claim is an implied warranty of merchantability. 
C) The claim is not a warranty because it is not in writing. 
D) The claim is not a warranty because it is sales puffery.

Question 20

Explain the concept and significance of identification of goods.Discuss how identification takes place.

Accepted Answer

Identification means the parties have de

Exam 22: Ownership, Risk and Warranties

Regardless of the language of the contract,title to goods passes to the buyer at the time and place at which the seller physically delivers the goods.

Leonardo fraudulently obtained a piece of jewelry from Jessica.He then sold the piece to Midori,who did not know about the fraud.Which of the following describes the situation?

In a shipment contract,the risk passes to the buyer when the goods are properly tendered at the destination point.

If shipping terms are C&F,then

Mike sold his car to Beth,who was to pick the car up at Mike's house and pay for it then.In fact,when Beth arrived,she discovered Mike's home and the car destroyed by a fire the night before.The risk of loss falls on

Mark,a power tool salesman,promises Jill,a customer,that the Turbo Power Hedge Trimmer 1000 will easily cut through bamboo up to 3 inches thick.Mark's statement constitutes an express warranty if Jill purchases the hedge trimmer.

A contract that requires a seller to deliver goods to the carrier is a

Crops are considered identified when they are planted.

The UCC looks solely upon "title" to determine ownership in goods.

Tuan,Inc.contracted to buy 200 monogrammed blankets from Titex,Inc.Before Titex segregated and monogrammed the blankets,Tuan filed for bankruptcy.Tuan does not own title to the blankets because

Only one party can have an interest in particular goods at a particular time.

If a seller includes an express warranty in the written sales contract,any disclaimer is invalid.

Discuss the concept of insurable interest.Indicate the difference between a buyer's and a seller's insurable interest.

In January,Eddie contracts to sell 100 bushels of soybeans in the fall.This contract

A sales representative at Oxtren,Inc.orally tells the purchasing agent at Wety,Inc.that its industrial saw is exceptional.Which statement is correct concerning the claim that the saw is exceptional?

Explain the concept and significance of identification of goods.Discuss how identification takes place.

Introduction to Law

Ethics and Corporate Social Responsibility

International Law

Common Law, Statutory Law, and Administrative Law

Constitutional Law

Dispute Resolution

Crime

Intentional Torts and Business Torts

Negligence, Strict Liability, and Product Liability

Privacy and Internet Law

Introduction to Contracts

Agreement: Offers and Acceptances

Consideration

Legality

Voidable Contracts: Capacity and Consent

Written Contracts

Third Parties

Contract Termination

Remedies

Practical Contracts

Introduction to Sales

Performance and Remedies

Secured Transactions

Creating a Negotiable Instrument

Liability for Negotiable Instruments

Accountants Liability

Agency Law

Employment and Labor Law

Employment Discrimination

Starting a Business: Llcs and Other Options

Partnerships

Life and Death of a Corporation

Management Duties

Shareholder Rights

Bankruptcy

Securities Regulation

Antitrust

Consumer Protection

Environmental Law

Intellectual Property

Real Property and Landlord Tenant Law

Personal Property and Bailment

Planning for the Future: Wills, Trusts and Insurance

Filters