Deck 12: Contracts for the Sale of Goods: Overview of Article 2

Question 1

Common law governs contracts involving services.

Answer 1

True

Question 2

The UCC rules regarding the sale of goods is much stricter in terms of the contract requirements such as consideration.

Answer 2

False

Question 3

When a contract involves both the sale of goods and services, the courts will determine what the predominant purpose to determine if the UCC or common law governs the contract.

Answer 3

True

Question 4

The fundamental goal of the UCC is to provide a simple and standardized method to promote commercial efficiency in the completion of business transactions.

Question 5

Which statement below is correct about the adoption of the Uniform Commercial Code?

A) Louisiana is the only state not to adopt the UCC in whole or in part.
B) California is the only state not to adopt the UCC in whole or in part.
C) Every state has adopted the entire UCC.
D) Every state has adopted all or substantially all of the UCC.

Question 6

Elisa enters into a contract to lease a car while she is attending college in California. Which provision of the UCC would apply to that contract?

A) Article 2
B) Article 2A
C) Article 3
D) Article 3A

Question 7

How many separate Articles of the UCC exist?

A) 15
B) 25
C) 11
D) 10

Question 8

Ethan is an attorney in Texas practicing contract law involving the sale of goods. He moves his practice to Montana to engage in the same type of practice of law. Which statement below is correct?

A) Since every state has adopted the entire UCC, he will be following the exact same rule in whatever state he practices.
B) Montana and Texas have not adopted the UCC and therefore, Ethan will have to learn the common law of Montana to practice in contract law involving the sale of goods.
C) Article 2A of the UCC will apply to the sale of goods in both states.
D) Since every state in the United States has adopted either all or substantially all of the UCC, he will have to learn which portions of the UCC Montana has adopted.

Question 9

The fundamental purpose of the creation of Uniform Commercial Code was to govern

A) Commercial transactions
B) Any sales transactions
C) Any service contract
D) Any contract involving something of legal value

Question 10

One of the greatest values of the UCC is that

A) It provides common law guidelines for commercial transactions.
B) It provides standardized and simple procedures for merchants in commercial transactions.
C) It allows guarantees of certain fundamental Constitutional rights in commercial transactions.
D) It establishes very strict requirements for valid and enforceable commercial transactions.

Question 11

Aurthur, owner of Mango Industries, enters into a contract with Hurley's grocery store wherein they agreed to sell mangos to the grocery store for $.50 a mango. The agreement did not state anything about what would occur if a mango was delivered with mango worms. If this event occurred and the contract is silent on this issue, according to the UCC what rule might apply to cover any unforeseen contingencies?

A) Article 2A rules
B) Delivery rules
C) Default rules
D) Equitable rules

Question 12

Another word for a default rule is

A) Mandatory rule
B) Equitable rule
C) Consideration rule
D) Gap-fillers

Question 13

Gap filler rules allow the business persons in the agreement to

A) Determine if a contract must be in writing to be enforceable.
B) Ensure that both parties to the contract enter into a fair contract.
C) Resolve problems of the contract not anticipated when the commercial contract was made.
D) Fill in the ambiguous terms with industry standard terms.

Question 14

Kumbamitwe Construction enters into a business contract with Daniel's Hardware to purchase lumber and supplies for the construction of a house. Daniel's Hardware delivers the lumber, but about 10% of the lumber is warped. The contract is silent on what would occur in the event of substandard products being delivered. According to the UCC, what might occur in this situation?

A) The parties may use default rule to resolve the problems of the contract not anticipated when the business contract was originally made.
B) Due to the ambiguity, the contract will be voidable.
C) Since the contract is silent on non-conforming products, the construction company will have to accept them as is.
D) The court will determine that no meeting of the minds truly occurred and therefore, a business contract never existed.

Question 15

Which statement below is correct about the application of default rules in a business contract?

A) The courts will only apply default rules if both parties agree to them after the fact.
B) The courts will apply default rules unless the parties explicitly override it with a different rule.
C) The courts will not apply default rules unless they are forced to do so by a jury trial.
D) The courts prefer to declare an agreement void rather than apply default rules.

Question 16

Ethan enters into a business contract with Riley for the purchase of 200 school desks. The contract specifically states that Riley must deliver all of the 200 desks in one week, set them up and Ethan must determine that all 200 desks are in perfect condition, or Riley must remove all the desks immediately and Ethan will owe Riley nothing. Which statement below is correct based upon the application of default rules in this situation should Riley only be able to deliver 199 perfect, according to Ethan, school desks?

A) The court will override the provision in the contract and reform the contract to determine that Ethan will have to pay for the 199 desks.
B) The court will declare the original contract was too harsh and unfair and will declare it void.
C) The court will determine that since the parties specifically addressed a provision of the contract, it cannot be overridden by a default rule.
D) The court will determine that the harsh term of delivery in the contract will be severed from the contract to promote fair dealing and good faith.

Question 17

The goal of a default rule is to

A) Allow the court to modify a business contract to make it more equitable.
B) Allow the court to modify a business contract to make it meet industry standards.
C) Allow the court to fill in the gaps to save an incomplete contract.
D) Allow the court to modify the terms of the contract to reflect notions of fair dealing and good faith.

Question 18

If a rule is mandatory, regarding business contracts, which of the following statements are correct?

A) It may be overridden if the parties choose to override it with specific provisions of the contract modifying the mandatory rules.
B) The court will have the discretion to determine if they wish to follow the mandatory rule.
C) The court will enforce the mandatory rule if the parties to the business contract agree to it.
D) The court will enforce the mandatory rule.

Question 19

Pitzer Medical Services enters into an agreement with Doctor Jones to sell him a kidney of a person who is willing to sell one of his kidneys. The sale of body organs is illegal, however, all parties to this situation are entering into the agreement willingly, voluntarily and with full-knowledge of the circumstances. The agreement even states this in it. Therefore, will the courts enforce the agreement as a business contract?

A) No, mandatory rules cannot be overridden even if the parties specifically address it.
B) Yes, mandatory rules can be overridden if the parties voluntarily and specifically address the provision of the agreement in question.
C) No, unless the courts determine that they price offered for the kidney is fair.
D) Yes, default rules always override mandatory rules.

Question 20

Michael Motors enter into a business contract with Charles to sell Charles a car. The contract specifically states that upon the date that both parties sign the contract, Michael motors is not responsible for any damages that occur to the car during delivery to Charles' house. This is an example of what type of default rule?

A) Allocating loss
B) Allocating risk
C) Delivery risk
D) Possessory loss

Question 21

Allocating loss, a default rule, addresses a loss in a contract,

A) After the loss has already occurred.
B) Before the loss has occurred.
C) In the event that it is highly likely that a loss could occur.
D) Only if the parties specifically address it.

Question 22

Basaba Realty sells a house to Mary Moore. Will the Article 2 of the UCC apply to the terms of the contract?

A) Yes because it is a commercial transaction.
B) Yes because it involves the sale of real property.
C) No because Mary is a private citizen.
D) No because real estate contracts do not involve the sale of goods.

Question 23

Triton Industries hires Carolyne to make aprons at their plant for sale in the Triton Industries Store. Will Article 2 of the UCC apply to the terms of the contract?

A) Yes because it is a commercial transaction.
B) Yes because it involves the employment to make a good.
C) No because employment contract do not involve the sale of goods.
D) No because Carolyne is a private citizen.

Question 24

According to the UCC tangible means

A) Anything of legal value.
B) Anything that is able to be touched.
C) Anything that is a term of the contract.
D) Anything that is legal.

Question 25

Shannon Steamers, a carpet cleaning business enters into a contract with Danyelle to clean her carpeting and also sell her carpet spot remover solution in a bottle. Will Article 2 of the UCC apply in this situation?

A) No, since the main purpose of the contract is the service of cleaning the contract.
B) No because Danyelle is a private person, not a merchant.
C) Yes because the sale of spot remover is a sale of a good.
D) Yes because the UCC applies to all commercial transactions.

Question 26

When a commercial contract involves both a service and a sale of good, what test will the courts use to determine if Article 2 of the UCC applies?

A) The mixed-use rule
B) The predominant purpose doctrine
C) The dominant purpose doctrine
D) The total purpose doctrine

Question 27

Jen purchases a couch from Ace Furniture store which includes delivery of the couch. Does Article 2 of the UCC apply to this contract?

A) Yes since the sale of a good, the couch is the predominant purpose of the contract and the delivery is incidental.
B) Yes since it is a commercial transaction.
C) No since the delivery of the couch is the predominant purpose of the contract and a service.
D) No since the contract does indeed contain a service in any part.

Question 28

What source of law applies to service contracts?

A) Article 2A of the UCC
B) Article 2 of the UCC
C) Common law
D) Statutory law

Question 29

Angel, a financial consultant, enters into a contract to advise Randy about the best investments given his financial situation. She writes down everything she states and gives it to Randy in a binder. Which source of law would apply?

A) Article 2A of the UCC
B) Common law
C) Article 2 of the UCC
D) Statutory law

Question 30

Which of the following examples is an example of a merchant according to the UCC?

A) A person selling goods at a garage sale.
B) A Girl Scout selling Girl Scout cookies.
C) A person selling clothing on Ebay.
D) A vacuum sales person selling door to door.

Question 31

Edith sells on Craigslist a life sized statute of a zebra that her mother in law gave to her as a birthday gift. Would this transaction be governed by the UCC?

A) Yes because it involves a sale of goods.
B) Yes because Edith is offering to exchange something of legal value.
C) No because Edith is not a merchant.
D) No because the UCC does not apply to Craisglist.

Question 32

Which statement below is correct when comparing the UCC and common law?

A) The UCC is much stricter than common law.
B) Common law is much stricter than the UCC.
C) The UCC and common law are virtually identical.
D) Common law only applies to the sale of goods.

Question 33

The Uniform Commercial Code is created by

A) Each individual state legislative branch.
B) The Federal government's legislative branch.
C) The National Conference of Commissioners of Uniform State Laws.
D) The Federal Trade Commission.

Question 34

Article 2A of the UCC applies to

A) The sale of goods
B) The lease of goods
C) The provision of a service
D) The lease of real property

Question 35

Default rules, under the UCC,

A) Only applies to bargained for exchanges.
B) Only applies to terms negotiated by the parties to the contract.
C) Only applies to service contracts.
D) Only applies to unforeseen terms not addressed in the contract.

Question 36

An agreement to transfer title of property or tangible assets for a certain price is called a

A) Sales contract
B) Service contract
C) Goods contract
D) Commercial contract

Question 37

Explain the origins of the UCC and its applicability in the United States legal system.

Question 38

Ella enters into a contract with Fitz's Root beer for the sale of ten cases of root beer. The contract does not cover where the root beer will be delivered. Fitz's attempts to deliver the root beer to Ella at her home, but Ella wanted it delivered to her parents' house. Based upon the facts stated, how will the UCC define the provisions of the contract that are not mentioned in the contract and how the court will address the missing provisions of the contract?

Question 39

Edgar grows Hibiscus plants in his back yard to sell to friends in the community and has been regularly selling the Hibiscus plants for over 15 years. Additionally, for the past 15 years when the flowers of the Hibiscus plants fall off the plant, Edgar collects them and presses the flowers to sell for art projects. Additionally, Edgar also offers to go to people's house to advise on the proper placement of the Hibiscus in home gardens according to the exposure to the sun and wind. And today, Edgar sells his favorite t-shirt with a giant Hibiscus picture on it to his friend. Evaluate each situation to determine if the UCC applies to the transaction.

Question 40

Explain how the predominant purpose test is used to determine if the UCC applies when a contract involves a sale of goods and the performance of services.

Question 41

Explain when common law will apply versus when the UCC will apply and the differences, in general between common law and the UCC as it relates to contract law.