Deck 13: Sales, Leases, and E-Contracts

Question 1

Under the UCC, a sale occurs when title passes from a seller to a buyer for a price.

Answer 1

True

Question 2

The term cure refers to the right of the seller to reject, adjust, or replace nonconforming goods.

Answer 2

True

Question 3

If a contract for a sale of goods does not include a price term, the price will be "a reasonable price."

Answer 3

True

Question 4

Unless the parties agree otherwise, the buyer is obliged to pay for goods within no more than 120 days.

Question 5

Under the UCC, a seller can accept an offer to buy goods only by a prompt promise to ship the goods.

Question 6

Until the time for performance under a contract expires, the seller has a right to cure.

Question 7

A buyer can accept an offer by any means reasonable under the circumstances.

Question 8

A seller can terminate a contract on the basis of commercial impractica?bility if in?creases in the seller's costs threaten to undercut its profits.

Question 9

Under the UCC, a contract for a sale of goods that includes an open delivery term is void.

Question 10

A buyer who obtains substitute goods to replace goods that a seller did not deliv?er can also recover damages from the seller.

Question 11

The doctrine of commercial impracticability only extends to problems that could have been foreseen.

Question 12

An unpaid seller can bring an action to recover the purchase price, on the buyer's breach of a contract, only if the goods are first disposed of.

Question 13

Any contract for a sale or lease of goods must be in writing to be enforceable.

Question 14

If a buyer wrongfully refuses to accept goods that conform to a contract, the seller may recover damages.

Question 15

If a sales contract is unilateral, the offeror need not be notified of the of?feree's performance.

Question 16

Under the UCC, a contract can be formed only on the terms of the original offer, not according to any additional terms of the acceptance.

Question 17

If a seller wrongfully refuses to deliver goods that conform to a contract, the buyer may recover damages.

Question 18

Under the UCC, an agreement modifying a contract "needs new consid?eration to be binding."

Question 19

The UCC imposes the same rules of conduct on merchants and consumers in all situations.

Question 20

A buyer must reject goods that fail in any respect to conform to the terms of a contract in every detail.

Question 21

Roy's Chick'n Shack orders chicken from Supremo Foods, but Supremo does not deliver. Roy's will probably be unable to enforce the agreement if the parties

A) did not limit the duration of the deal.
B) did not specify a payment term.
C) did not specify a quantity term.
D) have not begun to perform.

Question 22

High n' Mighty Mart, Inc., is an Illinois-based firm that does business throughout the United States. With respect to this circumstance, the UCC has been adopted by, and applies in,

A) all of the states, in whole or in part.
B) most of the states on the Atlantic and Pacific coasts.
C) none of the states, to date.
D) only the states within the watershed of the Mississippi, Missouri, and Ohio Rivers.

Question 23

Promises of fact made during the bargaining process are not express warranties.

Question 24

The terms in a click-on agreement may be enforced if the parties expressly agreed to them.

Question 25

A warranty of title protects a buyer who-knowingly or unknowingly-buys goods that are subject to a creditor's security interest.

Question 26

An expression of opinion by a seller will not usually create a warranty.

Question 27

Under federal law, an electronic signature is as valid as a signature on pa?per, without exceptions.

Question 28

An express warranty cannot be limited.

Question 29

An implied warranty can arise from a course of dealing or usage of trade.

Question 30

A written disclaimer can negate only implied warranties.

Question 31

An implied warranty of merchantability arises only in sales or leases between merchants.

Question 32

Rally Corporation enters into a contract to sell ski gear to SnoSportz Company, which sells a pair of the skis to Tyra, a consumer, who later sells them to Uli, another consumer. Article 2 of the UCC applies to the sales transactions between

A) all of the buyers and sellers.
B) Rally and SnoSportz only.
C) SnoSportz and Tyra only.
D) Tyra and Uli only.

Question 33

Expert Stitching Corporation enters into a contract to sell denim clothing to Fine Fashion Company, which in turn sells a pair of jeans to Grady, a consumer. In contrast to standards that apply to consumers, the UCC imposes on merchants

A) less strict legal standards.
B) special business standards.
C) stricter ethical standards.
D) the same overall standards.

Question 34

A buyer may reject a seller's goods only if they fail to conform to a mate?rial term of the contract.

Question 35

Bild-Rite, Inc., is a Colorado-based firm that does business with clients throughout North America. Bild-Rite oversees construction projects, and buys and sells commercial buildings, undeveloped land, and construction supplies and other goods. Bild-Rite has had to deal with work-site theft and vandalism. With respect to Bild-Rite's activities, the Uniform Commercial Code (UCC) provides a framework for

A) commercial transactions for the sale and lease of goods.
B) international construction contracts.
C) domestic and foreign transactions in real estate.
D) prosecuting crimes against business interests.

Question 36

The terms of a contract must have been read to be enforceable.

Question 37

Any electronic symbol, adopted by a person with the intent to sign an e-record, is an e-signature.

Question 38

Warranties of title do not arise in most sales contracts.

Question 39

Under the Electronic Signatures in Global and National Commerce (E-SIGN) Act, an electronic document is not as valid as a paper document.

Question 40

NuTech Company agrees to sell computer equipment to Office Stores, Inc. (OSI), for OSI to market to its customers. Their contract will most likely not be en?forceable unless it includes

A) a time limit on any warranties.
B) each party's contact information.
C) how much equipment is covered.
D) the retail price of the equipment.

Question 41

Bigge Projects, Inc., and Crane Equip Corporation enter into a contract for a lease of a construction crane. Crane Equip is a merchant who deals in goods of the kind leased. Under the UCC, an implied warranty of merchantability arises

A) automatically in lease contracts.
B) only if the lessee asks for it.
C) only if the lessor does not expressly disclaim it.
D) only in conjunction with sales contracts, not lease contracts.

Question 42

Best Sales, Inc., is the offeror and City Goods Corporation is the offeree under a unilateral sales contract in which Delta Products Company is also interested. Best is not notified of City's performance within a rea?son?able time. Best

A) may treat the offer as having lapsed.
B) must assume that City has started to perform.
C) must contact City.
D) must contract with Delta.

Question 43

Double D Ranch and Esau enter into a contract on August 1 for the sale of 200 cattle. Esau cancels the con?tract ten days later. Double D is unable to sell the cattle to another buyer. Double D is enti?tled to

A) force Esau to accept the cattle and recover the contract price.
B) keep the cattle and recover the contract price from Esau.
C) keep the cattle only.
D) recover the contract price from Esau but must destroy the cattle.

Question 44

Liv, a salesperson for Moto-Cross & More, Inc., tells Nan, "This is the best bike I've ever seen. Anywhere else you'd pay $10,000 for it." This is

A) an expression of opinion.
B) an express warranty.
C) an implied warranty.
D) a warranty of title.

Question 45

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 the sale of

A) any of the property evidenced by a writing.
B) any of the property that may involve fraud.
C) the furnishings priced at $500 or more.
D) the land and the building.

Question 46

Hi-Tech Company contracts to sell fiber optic cable to Internet Services, Inc. Hi-Tech may bring an action to recover the purchase price and inci?dental damages if Internet

A) accepts the cable and pays for it.
B) accepts the cable but does not pay for it.
C) rejects the cable.
D) revokes acceptance of the cable.

Question 47

Screen Perfect, Inc., and TV Stores enter into a contract for a sale of high-definition television sets. Screen Perfect ships goods that do not exactly conform to the contract in some details. TV Stores

A) cannot reject the entire shipment.
B) can reject the entire shipment.
C) must accept the entire shipment.
D) must reject the entire shipment.

Question 48

Vehicle Leasing Agency (VLA) and Wander Trucking Company enter into a contract for a lease of eight cargo vans. VLA delivers eight vans, but they are not cargo-sized. Wander

A) cannot reject the entire shipment.
B) can reject the entire shipment.
C) must accept the entire shipment.
D) must reject the entire shipment.

Question 49

Commuter Car Company and Dave's Autos enter into a contract for a sale of motor vehicles. Commuter assures Dave's that it has valid title to the vehicles. Under the UCC, a warranty of title arises

A) automatically in most sales contracts.
B) only if the buyer asks for such a warranty.
C) only if the seller expresses such a warranty.
D) only in conjunction with lease contracts, not sales contracts.

Question 50

Dependable Appliances, Inc., and Elain enter into a contract for a sale of kitchen appliances. Dependable, a merchant who deals in goods of the kind sold, notes that its goods come with an implied warranty of merchantability. Under the UCC, this means that the goods are reasonably

A) fit for the buyer's particular purpose.
B) fit for the ordinary purpose for which such goods are used.
C) suitable for resale at an acceptable price.
D) the best quality that money can buy.

Question 51

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

A) doing nothing.
B) promising to ship or promptly shipping the cement.
C) promising to ship the cement only.
D) promptly shipping the cement only.

Question 52

Neil goes to Oil Shop to change the oil in his car. Pat, the service tech?ni?cian, learns that Neil plans to take a trip and advises the use of a certain type of oil. The oil breaks down during the trip, damaging the car. Neil may recover from Oil Shop for breach of

A) an express warranty.
B) an implied warranty of fitness for a particular purpose.
C) an implied warranty of merchantability.
D) a warranty of title.

Question 53

Owen and Pablo enter into a contract for a sale of fifty Western saddles. Pablo pays, but Owen does not deliver. Pablo can normally recover as damages the difference between

A) any loss avoided and any profit gained.
B) the actual price and the hoped-for price.
C) the contract price and the market price.
D) the current prices in the parties' locations.

Question 54

Rocky and Slim enter into a contract for a sale of five rowboats. Circumstances make it difficult for Rocky to perform, and the contract is breached. Slim looks for remedies. In contrast to the common law, remedies under the UCC are

A) cumulative.
B) exclusive.
C) limited.
D) unlimited.

Question 55

Ocean Vessels, Inc., and Pacific Harbor Company enter into a contract for a sale of a ship. Ocean is a merchant who deals in goods of the kind sold. The ship is defective. Under the UCC, this is a breach of the implied warranty of merchantability

A) only if Ocean did not know about and could not have discovered the defect.
B) only if Ocean did not know about the defect.
C) only if Ocean knew about or could have discovered the defect.
D) regardless of what Ocean knew or could have discovered.

Question 56

Retail Music, Inc., offers to buy from Super Products Corporation (SPC) 1,000 blank CDs of a certain brand. Without notifying Retail, SPC timely ships CDs of a different brand. This shipment is

A) an acceptance of the offer and a breach of the parties' contract.
B) an acceptance of the offer and a fulfillment of the parties' contract.
C) a refusal of the offer and a breach of the parties' contract.
D) a refusal of the offer and a fulfillment of the parties' contract.

Question 57

On May 1, Cy's Auto & Truck Sales agrees to sell a car to Dino. Five days later, Dino refuses delivery and cancels the contract. Cy's is entitled to

A) force Dino to accept the car.
B) recover any damages from Dino but not resell the car.
C) resell the car and recover any damages from Dino.
D) resell the car but not recover any damages from Dino.

Question 58

Business Rental Corporation (BRC) and Cartage Trucking Company enter into a contract for a lease of ten hydraulic lifts. Under the perfect tender rule, BRC must ship or tender goods to the lessee that

A) approximately conform to all of the details of the contract.
B) entirely conform to the contract except in one or two details.
C) exactly conform to the contract in every detail.
D) substantially conform to the contract in most details.

Question 59

Loni and Myra enter into a contract for a sale of clarinets and other wind instruments. Loni delivers, but Myra does not pay. Loni can normally recover as damages the difference between

A) any loss avoided and any profit gained.
B) the actual price and the hoped-for price.
C) the contract price and the market price.
D) the current prices in the parties' locations.

Question 60

Craft Engineering, Inc., contracts for a sale of technical instruments to Detail Design Company. Before the date on which performance is due, Craft notifies Detail that it will not perform. This is

A) anticipatory repudiation.
B) perfect tender.
C) rejection of performance.
D) revocation of acceptance.

Question 61

Goode Tire Company makes and sells tires and related products. Hiway Delivery Service enters into a contract to buy tires from Goode Tire. Under the UCC, an implied warranty of fitness for a particular purpose arises

A) automatically in this contract.
B) only if Goode Tire expressly warrants it.
C) only if Goode Tire knows the purpose and that Hiway is relying on Goode Tire to select suitable goods.
D) only if Hiway asks for it.

Question 62

Metalwork, Inc., orders supplies online from National Parts Supply. To complete the order, Metalwork clicked on a button that said, in reference to certain terms, "I agree." Most likely, the par?ties have

A) a binding contract that includes the terms.
B) a binding contract that does not include the terms.
C) an unenforceable contract that includes the terms.
D) an unenforceable contract that does not include the terms.

Question 63

Lively Toys Store and Movin' Products Company (MPC) enter into an e-contract under which MPC agrees to ship a case of electronic, remote-controlled bugs to Lively Toys, which agrees to pay on delivery. The Uniform Electronics Transactions Act (UETA)

A) denies the enforcement of such contracts.
B) does not apply to such contracts.
C) preempts all other laws with respect to such contracts.
D) supports the enforcement of such contracts.

Question 64

Bret enters into a contract with Collegiate University over the Internet to take an online course titled "Internet Law." This is an e-contract because

A) the contract was entered into over the Internet.
B) the contract was formed electronically.
C) the contract will be performed online
D) the subject matter of the contract is "Internet Law."

Question 65

Order Processing Corporation and Pinpoint Data, Inc., enter into a con?tract online in a state that has enacted the Uniform Electronic Transactions Act (UETA). With regard to the E-SIGN Act

A) the E-SIGN Act does not preempt the UETA.
B) the E-SIGN Act preempts the UETA.
C) the "fit" between the acts is an issue for a court to determine.
D) the two acts "cancel" each other's application.

Question 66

Dik and Ewa engage in a transaction that involves e-documents. The Electronic Signatures in Global and National Commerce Act (E-SIGN Act) applies if those documents include

A) a divorce decree or a prenuptial agreement.
B) a health-insurance termination.
C) an agreement subject to Article 2 of the Uniform Commercial Code.
D) an eviction or a foreclosure.

Question 67

Tune Products, Inc., offers to sell to Unlimited Sales Company one hundred MP3 players at $50 a piece, subject to certain specific delivery dates. Unlimited replies with a signed purchase order that reads, "Accept your offer for 100 I-appliances at $50 each. Must be delivered to our warehouse." Tune does not respond or deliver the goods. Unlimited files a suit for breach of contract, to which Tune answers that there is no contract because Unlimited's purchase order contained additional terms and is not signed by Tune. Can Unlimited recover Explain.

Question 68

Howe enters into a contract with Ida over the Internet to buy soybeans as a hedge against falling prices in corn. Neither party prints out a hard copy. Under the Electronic Signatures in Global and National Commerce Act (E-SIGN Act), this contract can

A) be denied legal effect if it falls under the UCC's Statute of Frauds.
B) be denied legal effect unless a hard copy is printed.
C) be denied legal effect until it is executed.
D) not be denied legal effect because it is only in electronic form.

Question 69

Signal Sets Company contracts to deliver one hundred 52-inch 3D high-definition television sets to a new retail customer, Tuner TV Store, on May 1, with payment to be made on delivery. Signal tenders delivery in its own truck. Tuner's manager notices that some of the cartons have scrape marks. Tuner's owner phones Signal's office and asks whether the sets might have been damaged as they were being loaded. Signal assures Tuner that the sets are in perfect condition. Tuner tenders Signal a check, which Signal refuses, claiming that the first delivery to new customers is always for cash. Tuner promises to pay the cash within two days. Signal leaves the sets with Tuner, which stores them in its warehouse pending its "Grand Opening Sale" on May 15. Two days later, Tuner's stocker opens some of the cartons and discovers that a number of the sets are damaged beyond ordinary repair. Signal claims Tuner has accepted the sets and is in breach by not paying on delivery. Will Signal succeed on these claims Explain.

Question 70

Flem, a user of GameCenter.com's Web site, can download gaming software if he first clicks on "I accept" after viewing certain terms. If Flem clicks and downloads, this is

A) a contract that does not include the terms.
B) a contract that includes the terms only if Flem read them.
C) a contract that includes the terms whether or not Flem read them.
D) not a contract.

Question 71

Regal Autos, Inc., sells cars to consumers. Stiv, a Regal salesperson, tells potential customers "what they want to hear." To avoid liability for oral ex?press warranties, each Regal sales agreement should note that a car is sold

A) as is.
B) in perfect condition.
C) subject to warranties included in the written contract only.
D) with no known defects.