Exam 8: Contracts for the Sale of Goods

Cathy's Coaster Company uses cork in all of the protective drink coasters that they manufacture.If they enter into an agreement with a cork exporter from Portugal to purchase all of the cork they need to produce their products,this would be:

Wrongfully revoking an acceptance will constitute a breach of contract by the buyer.

If the seller ships conforming goods,the buyer has a duty to accept them and may not reject the goods.

Uncle Phil has lent you $10,000 to pay tuition and other school related costs.You've now graduated and Uncle Phil is asking about repayment terms.The loan was never evidenced in writing.This transaction falls under the UCC statute of frauds.

The United Nations Convention on Contracts for the International Sale of Goods,with regard to cure:

If one party to a contract has reasonable grounds to believe that the other party will not or cannot perform the contract,they have the right to demand ________ from the other party concerning performance.

In the case of Rosenfeld v.Basquiat,Basquiat sold several paintings to Rosenfeld and provided him with a written receipt.Unfortunately Basquait died before delivery and Basquait's heirs challenged the enforceability of the agreement.The court determined that:

An irrevocable offer made by one merchant to another is called a _______.

Johnson Builders is selling a newly built home to Sheila.JRK Realtors is handling the transaction.This sale is covered under Article 2 of the UCC.

If terms are left open in a sales contract,the UCC will complete the contract by inserting ________ to make the contract enforceable.

Which of the following is true of open priced term contracts?

(p.Reflective Thinking)Two merchants agree to a sale of goods to be shipped by boat from Maine to Florida.No other shipping terms are indicated.If the boat sinks during the trip and all the goods are destroyed:

In the absence of a specific contract provision regarding the details of payment the UCC provides that:

Explain how the UCC "battle of the forms" is resolved in nonmerchants and in merchant transactions.

Lon's GPS,Inc.orders 500 Class A widgets to be installed in GPS units they are manufacturing.When delivery is made on Monday,the widgets delivered are Class B. Lon's signs a receipt accepting the nonconforming shipment. The next day, Lon's installs some of the Class B widgets and finds that the Class B widgets perform with half the accuracy of the Class A widgets. What if any options does Lon's have? In most cases when a shipment of nonconforming goods is accepted, the buyer may seek to adjust the price if applicable but they forfeit the right to subsequently reject the goods. In this situation however, the UCC provides that if nonconforming goods are accepted and the nonconformity is found to substantially impair the value of the goods, the buyer may in fact revoke acceptance if done within a reasonable time.

Commercially reasonable means:

Jones Corp.is set to deliver goods ordered by Smith,Inc.and calls to confirm that the goods will be delivered the next day.Smith,Inc.,on the phone,notifies Jones Corp.that they have found the same goods cheaper from another seller and will not accept delivery.In order for Smith,Inc.to officially be in breach of contract,Jones Corp.must deliver and tender conforming goods and have Smith,Inc.wrongfully reject them.

Acme Rocket Company is shipping 500 toy rockets to Rockets R Us.Acme is located in Miami and Rockets R Us is located in Boston.If goods are shipped FOB Miami:

Mackey Pharmacy Corp.orders 5000 cases of regular strength aspirin from MAK Pharmaceuticals.When they are delivered,an inspection shows that while the delivery is conforming to the contract with regard to quantity and quality of the aspirin,none of the aspirin are in child proof bottles.The contract was silent regarding the issue of child proof bottles.Mackey rejects the delivery and MAK sues them for breach of contract.How should the courts analyze and resolve this matter?

UCC risk of loss provisions will govern the terms of a contract even if the parties have specified risk allocation in the contract.