Deck 21: Performance and Remedies

Question 1

If a buyer does not receive goods by the contract deadline,remedies available include:

A)incidental and consequential damages.
B)cover.
C)damages for non-delivery.
D)All of the above.

Answer 1

D

Question 2

If the seller breaches,the buyer may reasonably obtain substitute goods but may not obtain the difference between the contract price and the cover price.

Answer 2

False

Question 3

Under the UCC,the seller's right to correct a shipment of non-conforming goods is called:

A)correction.
B)cure.
C)cover.
D)retender.

Answer 3

B

Question 4

A seller may not make minor necessary repairs or adjustments that will bring the goods into conformity in order to "cure" nonconforming goods.

Question 5

"Course of dealing" refers to prior commercial transactions between the same parties.

Question 6

A homeowner has a contract with a firewood supplier to bring a rick of hardwood at the beginning of each month from October through March.If,for the first three deliveries,the supplier has brought a mixture of hard and soft woods,the homeowner cannot reject a delivery in January because it includes some soft wood.

Question 7

Courts generally declare illegal agreements whereby parties limit the effect of the perfect tender rule.

Question 8

The Hessler v.Crystal Lake Chrysler-Plymouth,Inc.case addressed the issue of:

A)the buyer's right to cover.
B)the seller's right to resell.
C)the seller's right to cure.
D)the buyer's right to inspect the goods.

Question 9

In the Zion Temple First Pentecostal Church of Cincinnati,Ohio,Inc.v.Brighter Day Bookstore & Gifts case,the court found that,because of an error in the catalog,there was no right to cure a nonconformity with the sleeves of the robes.

Question 10

A buyer who accepts nonconforming goods may revoke the acceptance under limited circumstances.

Question 11

The common law requirement that the seller make a tender of delivery that conforms in all respects to the contract requirements was retained by drafters of the UCC,although the Code includes sections that limit the rule's effect.

Question 12

Under the "perfect tender rule" the buyer may reject the goods if they fail in any respect to conform to the contract.

Question 13

Matson agrees to purchase 500 wooden chairs from Woodcarvers,Inc.After Woodcarvers sets the chairs aside in its warehouse,but before the risk of loss passes to Matson,the chairs are destroyed in a fire,which was not the fault of Woodcarvers.The contract between Matson and Woodcarvers is void.

Question 14

Meister Bros.shipped 250 radiator belts to fill Braybon's order.Quality control measures had been in place in Meister's factory when the belts were manufactured.When Braybon received the order one day before it was due,it notified Meister that it rejected the belts because of a variation from the contract specifications.Meister,although it believed the original belts met the contract specifications,notified Braybon that it would supply conforming goods within one week.When the conforming goods arrive in one week:

A)Braybon does not have to accept them because the contract deadline has passed.
B)Braybon does not have to accept them because Meister Bros.only has one chance to fill the order correctly.
C)Braybon should accept them because Meister Bros.has a right to cure even after the contract deadline under these circumstances.
D)Braybon does not have to accept them because Meister Bros.failed to meet its UCC requirement to deal in good faith.

Question 15

If Chuck buys cheese from Cheese Inc.,then fails to inspect the cheese within a reasonable amount of time and does not reject the shipment,Chuck has accepted the shipment even if there is non-conformity.

Question 16

The duties of the buyer include all of the following except:

A)acceptance of conforming goods.
B)payment for conforming goods.
C)delivery of the documents of title to the seller as a tender of goods.
D)notifying the seller of rejection of non-conforming goods within a reasonable time.

Question 17

A buyer has an absolute right to reject goods as long as the rejection is timely.

Question 18

Wimble ordered $800 worth of pro-quality luminescent orange tennis balls from Sports Unlimited.On June 1,Sports Unlimited shipped standard white tennis balls that were rejected by Wimble.Wimble bought the same number of pro-quality luminescent orange balls from another supplier the same day for $550.In a suit against Sports Unlimited,Wimble may recover $800.

Question 19

Tender means to make conforming goods available to the buyer.

Question 20

If the buyer rejected the goods,the seller may reasonably resell them and obtain the difference between the resale price and the contract price.

Question 21

According to the Smith v.Penbridge Associates,Inc.case,future profits:

A)may never be included in consequential damages as they are too speculative..
B)may not be awarded as the UCC Section 2-715 prohibits them.
C)may be awarded under UCC Section 2-715 (2) even though they cannot be calculated with accuracy.
D)are always awarded as incidental damages.

Question 22

Which of the following statements about the UCC "perfect tender" rule is correct?

A)The buyer has the obligation to accept the goods if the nonconformity is not substantial but is entitled to compensation.
B)The buyer can reject the entire shipment if any portion of the goods are nonconforming.
C)The buyer must reject nonconforming goods.
D)If the buyer rejects the goods, he must reject the whole shipment, even though some of the goods are conforming.

Question 23

A buyer who properly rejects goods:

A)can do so by sending the goods back in any manner.
B)must notify the seller of the rejection within a reasonable time.
C)must pay the costs of returning the rejected goods.
D)None of the above.

Question 24

A buyer may revoke an acceptance of goods if:

A)the nonconformity does not impair the value of the goods.
B)the buyer had a legitimate reason for the initial acceptance.
C)the buyer knew the nonconformity could not be cured.
D)the buyer thought they could easily cover.

Question 25

Which of the following statements is not true regarding the buyer's right to cover?

A)The buyer must cover.
B)The measure of damages in a cover is the difference between the cover price and the contract price.
C)Cover must be done by reasonably obtaining substitute goods.
D)Consequential damages can be recovered in addition to the cover damages.

Question 26

Under the doctrine of commercial impracticability,which situation would not excuse the seller's performance?

A)The seller forgot to include the cost of freight in a C&F contract.
B)The seller's source of supply is no longer available because of a governmental embargo prohibiting an export from another country.
C)The seller cannot deliver because severe flooding wiped out three-fourths of the state's produce.
D)The seller's workforce is out on an unexpected strike.

Question 27

Assume that Sherrie's Cherries contracts with Dessert World to sell and ship 600 pounds of cherries in three equal installments of 200 pounds each.If the first installment arrives with 5 pounds of spoilage,then Dessert World may:

A)reject the installment shipment because of the perfect tender rule.
B)not reject the installment if those in the food industry expect a small percentage of spoilage with fresh fruits or vegetables.
C)reject the entire contract.
D)declare a breach and "cover."

Question 28

Tim has been remodeling his restaurant for over three months.He ordered 80 brand new white chairs from Chairs,Inc.to be delivered by July 15.On July 2,Tim receives 80 black chairs.As of July 3,Chairs,Inc.:

A)may cure before July 15.
B)may be sued by Tim as they have breached the contract.
C)may resell the white chairs.
D)all of the above

Question 29

When a party to a contract notifies the other party that it will not perform the contract as agreed,this conduct is referred to as:

A)specific performance.
B)cover.
C)repudiation.
D)assurance.

Question 30

If a contract does not provide for a time for inspection,the UCC allows inspection:

A)in a reasonable time.
B)the same day as delivery.
C)within 3 days of delivery.
D)within 10 days of delivery.

Question 31

A buyer who is unable to obtain cover:

A)will be limited to the remedy of incidental damages.
B)will be limited to the remedy of consequential damages.
C)will be limited to the remedy of liquidated damages.
D)may be allowed the remedy of specific performance.

Question 32

The Code's requirement of good faith in the performance and enforcement of every contract imposes:

A)a greater duty on merchants than consumers.
B)a greater duty on consumers than merchants.
C)the same duty on both consumers and merchants.
D)a greater duty on parties to a sales contract with the purchase price over $500.

Question 33

Family Time Restaurant has a contract with Prime Meats for Prime to deliver 100 pounds of ground sirloin twice a week for the next three months.If,on one delivery,Prime brings 95 pounds of ground chuck instead of 100 pounds of ground sirloin:

A)Family Time may unquestionably reject the non-conforming goods because they vary in both quantity and quality.
B)Family Time may reject the non-conforming installment only if it substantially impairs the value of that installment and cannot be cured.
C)Prime has no right to cure.
D)the perfect tender rule applies.

Question 34

A buyer who accepts goods but notifies the seller the goods are non-conforming:

A)cannot recover any damages.
B)can recover the difference between the goods as promised and as delivered, plus incidental and consequential damages.
C)cannot recover incidental damages.
D)cannot recover consequential damages.

Question 35

Reba orders a pair of custom-made cowboy boots,C.O.D.from Home on the Range Western Wear.When the boots arrive,Reba pays the carrier for the boots,then opens the package,only to discover that the boots are the wrong snake skin color and three sizes too big.At this point:

A)she is entitled to inspect the goods after payment (due to the C.O.D.terms) and she can reject the boots because they are nonconforming.
B)Reba cannot revoke the acceptance, because the wrong color and size of the boots are not substantial impairments.
C)Home on the Range can allege that Reba did not conduct a proper inspection; therefore, though Home on the Range must cure, Reba is obligated to pay for the return of the incorrect boots and the shipment of replacement boots.
D)None of the above.

Question 36

Buyer Bob breaches his contract for the sale of goods with Seller Suzie.Suzie still has possession of the goods at the time of the breach.Suzie can refuse to deliver the goods and:

A)resell the goods and sue Bob for the total contract price.
B)either resell the goods or sue, but not both.
C)resell the goods and sue for any loss on the sale plus incidental damages less expenses saved.
D)resell the goods and sue only for incidental damages.

Question 37

The Lile v.Kiesel case addressed the issue of:

A)cover.
B)rejection.
C)revocation.
D)all of the above.

Question 38

Neon orders one thousand 25-foot nylon ropes from Hang'em High Co.Upon inspection of the delivery,Neon learns that Hang'em sent five hundred 25-foot ropes and five hundred 20-foot ropes.Neon may:

A)demand that Hang'em send 500 additional 25-foot ropes.
B)accept the 500 conforming ropes and reject the 500 nonconforming ropes.
C)seek an installment contract.
D)declare an anticipatory repudiation.

Question 39

Which of the following is NOT a remedy available to the buyer?

A)Cure.
B)Cover.
C)Specific performance.
D)Liquidated damages.

Question 40

If a seller cures within a reasonable amount of time:

A)the buyer retains the right to sue the seller for consequential damages.
B)the contract has been performed.
C)the buyer retains the right to cover.
D)the contract is voidable at the buyer's option.

Question 41

Discuss the UCC rules on the limitation of damages in a contract.

Question 42

Define these terms: usage of trade; course of dealing; and course of performance.

Question 43

Identify six possible remedies for a seller when the buyer breaches a contract.

Question 44

Can the buyer revoke his acceptance? If so,under what circumstances?

Question 45

Identify seven possible remedies for a buyer when the seller breaches a contract.

Question 46

Leonna orders five table settings of china from Elite China.Each set includes a dinner plate,cup & saucer,bowl,and dessert plate.The china is sold only in sets.When the delivery arrives,Leonna discovers that Elite China sent the wrong pattern.Leonna immediately calls Elite China and is instructed to send the shipment back.While repacking the shipment,Leonna changes her mind and decides to keep the cups and saucers.She returns everything else.Can she do this?