Exam 17: The Formation of Sales and Lease Contracts

If the parties to a contract for a sale of goods have not agreed on a price, a court will determine a reasonable price at the time for delivery.

Requirements contracts are common in the business world and normally are enforceable.

Fact Pattern 17-1 Olga enters into a contract to buy a refrigerator from a Prairie States Appliance store with the price to be paid in monthly installments. After thirty-six months of payments, Olga has paid more than twice the price of a similar stove. Eighteen payments remain due under the contract. -Refer to Fact Pattern 17-1. Olga files a suit against Prairie States, claiming that their contract is so unfair and one sided that it would be unreasonable to enforce it. Olga is asserting

When no delivery terms are specified in a contract for a sale of goods, there is no basis for determining a remedy.

Under the UCC, a firm offer for a sale or lease of goods made by a merchant without consideration can be revoked at any time before acceptance.

Rita, the manager of the State University (SU) soccer team, orally agrees to lease a certain number of specially made SU banners from Top Banners, Inc. This lease is enforceable only if Top has made a substan?tial start on making the banners and

In a dispute over a sale involving a restored 1937 Ford Roadster, Garth argues that for the purpose of the sale, Hoyt's Pawn Shop, where Garth bought the auto, is a merchant. A court may determine whether Hoyt's is a merchant by assessing whether

Dan, a computer programmer, holds a garage sale to sell a lawnmower, some clothes, some CDs and some old clothes. Will, a lawyer, sells Thelma his collection of seashells. Philip, a CEO of a successful company, sells George his pet parakeet. Judy, an expert horse trainer, sells Bob a horse. Which person would be considered a merchant under the UCC?

Community Construction Corporation offers to buy from Solid Cement Company a certain quantity of cement for a certain price. Solid can ac?cept the offer by

In interpreting a commercial agreement, a court will assume that the usage of trade was taken into account when the agreement was phrased.

Article 2 of the UCC sets forth the requirements for sales contracts and Article 2A covers similar issues for lease contracts.

Under the UCC, a sales or lease contract will fail for indefiniteness if one or more terms are left open.

Quinn enters into a series of agreements with Reba involving a sale of a Suite Dreams Motel, including the land, building, furnishings, shares of stock in Suite Dreams Company, and a contract with Trudy to create an ad campaign. Reba suspects that Quinn may be misrepresenting the facts. The UCC Statute of Frauds governs

Under the UCC, good faith means honesty in fact and the observance of reasonable commercial standards of fair dealing in the trade.

Over the course of a year, Discount Market Company sells goods from its inventory and also sells one of its warehouses. In exchange, Discount receives checks, which Discount uses to repay a loan from Evermore Credit Inc. Article 2 of the UCC governs

Under the UCC, the meaning of any agreement must be interpreted in light of commercial practices.

Under the UCC, if a contract is unilateral, the offeror must be notified of the of?feree's performance.

Jamie is redoing his kitchen and decides he needs a floor sander to complete the job. Jamie tells Rachel, his neighbor, that he needs a floor sander. Rachel tells Jamie to call Home Repair Rentals, Inc. Home Repair Rentals leases Jamie a floor sander. In this transaction the lessor is

An unconscionable contract is one that is so unfair and one sided that it would be unreasonable to enforce it.

A court can refuse to enforce a contract that the court deems to have been unconscionable at the time it was made.