Deck 25: Product Liability: Warranties and Torts

Question 1

If the theory of privity of contract still applied, it would be difficult for purchasers injured by defective goods to sue manufacturers.

Answer 1

True

Question 2

An express warranty is basically any statement of fact or promise made about the goods that becomes part of the basis of the bargain.

Answer 2

True

Question 3

Any warranty that does not provide the complete protection of a full warranty is called a warranty in breach.

Answer 3

False

Question 4

No law requires a seller to make an express warranty.

Question 5

An express warranty can be made orally or in writing.

Question 6

An express warranty arises when goods are purchased based on a catalog illustration.

Question 7

A statement by a seller relating to goods that is part of the basis of the bargain is an express warranty.

Question 8

An express guarantee is governed by the UCC, and warranties are governed primarily by the common law of contracts.

Question 9

When a buyer makes a purchase without relying on the seller's skill and judgment, no warranty of fitness for a particular purpose exists.

Question 10

The scope of warranties remains the same regardless of whether the seller is a merchant or a casual seller.

Question 11

If a lawn mower will not cut any type of grass, there is a breach of the warranty of merchantability, even if the warranty was conspicuously disclaimed.

Question 12

If a seller sells an automobile to a buyer and then delivers the car with an outstanding lien on it that was unknown to the buyer at the time of the sale, there is a breach of the implied warranty of merchantability.

Question 13

The requirement of privity of contract to allow recovery in a sales contract has been widely rejected.

Question 14

Express warranties may be made before, during, but not after the sale of goods.

Question 15

A seller's opinion cannot ordinarily be treated as a warranty.

Question 16

Plaintiffs suing for damages caused by a defective product are limited to taking action only against the manufacturer(s) of such goods.

Question 17

A seller cannot be held liable for the breach of an express warranty if the seller honestly believed that the warranted statement was true.

Question 18

The right to sue for damages sustained from a defective product is reserved exclusively to the buyer of such goods.

Question 19

It is necessary to the creation of an express warranty that the seller use formal words such as "warrant" or "guarantee."

Question 20

Whenever a sale of goods is made, certain warranties are implied unless they are expressly excluded.

Question 21

In applying the "foreign substance/natural substance" liability test in the sale of food or drink, courts hold that there is liability if the seller does not deliver to the buyer goods of the character that the buyer reasonably expected.

Question 22

The federal regulation of express warranties:

A) applies only to limited warranties.
B) applies to a seller who makes a written express warranty for a consumer product costing more than $10.
C) requires all express warranties to be full warranties.
D) requires an implied warranty to be designated as either full or limited.

Question 23

Which of the following is not a product liability theory that protects buyers and allows them to recover for injury and economic loss?

A) express warranty
B) implied warranty
C) strict tort liability
D) assumption of the risk

Question 24

Unless otherwise agreed, every merchant seller warrants that goods are sold free of any rightful claim by any third party.

Question 25

To recover liability, the plaintiff must show the defendant was negligent.

Question 26

If there is a written contract, a disclaimer of the implied warranty of merchantability must be conspicuous.

Question 27

Provisions in a sales contract that exclude implied warranties bar the buyer from recovering damages for fraud.

Question 28

If an express warranty is breached,

A) an action for breach of express warranty is the buyer's exclusive remedy.
B) the seller nevertheless has no warranty obligation if the buyer had the opportunity to inspect the goods before purchasing them.
C) the warrantor is liable, even if the seller or manufacturer who made the express warranty honestly believed that the warranty was true.
D) the seller is not liable for breach of one or more implied warranties.

Question 29

Manufacturers who prepare goods to the buyer's specifications are under exceptionally stringent warranty obligations for fitness for a particular use.

Question 30

An exclusion of warranties made in the manner specified by the Uniform Commercial Code is not unconscionable.

Question 31

The theories of product liability are mutually exclusive.

Question 32

Which of the following statements made by the seller does not likely constitute an express warranty?

A) "This looks beautiful on you."
B) "This is 100 percent wool."
C) "This motor generates 100 horsepower."
D) "This is a 3.2 liter rotary engine."

Question 33

All of the following statements about express warranties are true except:

A) It is immaterial whether the express warranty is made at the time of the sale or after the sale.
B) Separate consideration is required to legitimize a warranty made at the time of the sale.
C) A warranty made after a sale may be considered a modification of the sales contract.
D) If a warranty made after a sale is a modification of the sales contract, no additional consideration is required.

Question 34

A warranty is limited if:

A) only the original buyer is covered by the warranty.
B) the buyer must pay any cost for repair or replacement of a defective product.
C) it covers only part of the product purchased.
D) all of the above.

Question 35

Only the parties to a sales contract could sue each other under the traditional concept of:

A) exclusivity of contract.
B) privity of contract.
C) privacy of contract.
D) priority of contract.

Question 36

A merchant has greater potential warranty liability than does a casual seller.

Question 37

The defendant in a defective product suit may be:

A) the seller.
B) the manufacturer.
C) the manufacturer of a component part.
D) all of the above.

Question 38

The warranties of both merchantability and fitness for a particular purpose exist under the Convention on Contracts for the International Sale of Goods (CISG).

Question 39

In most instances, the mere fact that a sale was made gives rise to a(n):

A) express warranty.
B) limited warranty.
C) full warranty.
D) implied warranty.

Question 40

Under what type of warranty is the seller obligated to fix or replace a defective product within a reasonable time at no cost to the buyer?

A) full
B) express
C) limited
D) implied

Question 41

The theories of product liability

A) are mutually exclusive.
B) are not mutually exclusive.
C) are set forth exclusively in the UCc.
D) are set forth exclusively in the common law.

Question 42

The warranty of merchantability guarantees that the:

A) party in question is a merchant.
B) product is fit for the ordinary purposes for which it is sold.
C) product will remain fit for its normal use for the applicable statute of limitations period.
D) product can be resold by the buyer if the buyer does not want to keep it.

Question 43

An examination of goods excludes any implied warranty with respect to a defect that:

A) is apparent after a reasonable examination is made.
B) will not be apparent without chemical analysis.
C) will not be apparent until the goods are processed or used in manufacturing.
D) is unknown to all parties and is not detectable by reasonable examination.

Question 44

By the mere act of selling, a warranty is made that the:

A) goods are the finest available.
B) seller's title is good and the transfer is rightful.
C) price is the lowest available.
D) goods represent the latest technology.

Question 45

Which of the following must be proven by a plaintiff to recover for strict liability in tort?

A) negligence of the seller or manufacturer
B) recklessness of the seller or manufacturer
C) unreasonably dangerous defects in goods that cause harm
D) privity of contract between the manufacturer and the buyer

Question 46

Arthur was looking for a Father's Day gift for his dad, Tony. Tony was a cigar smoker but Arthur was a nonsmoker. Arthur went to a cigar store and was looking around when the proprietor suggested Arthur try a new imported cigar. The proprietor touted this new cigar as "just like the great Cuban cigars." Arthur was reluctant but did light one of the cigars, which had a pleasant aromatic smell and took about five to six minutes to be consumed. On this basis, Arthur bought a box of the cigars and presented them to his father as a gift. When the father smoked one of the cigars, it gave off an acrid smell and was completely consumed in less than two minutes. When Arthur saw this, he was very upset and asked his father to try another. The same situation was repeated with the acrid odor and the cigar burning down very quickly like a cigarette.
After Arthur tried unsuccessfully to return the cigars for a refund, Arthur filed a small claims court action against the store. The case was based on the failure of the purchased cigars to conform to the sample, breach of the implied warranty of merchantability, and the misleading statement "just like the Cuban cigars." Discuss the probable outcome of the case.

Question 47

Which of the following implied warranties is created when the buyer relies on the seller to pick out the goods that the buyer requires to meet a stated need?

A) conformity to description
B) merchantability
C) fitness for a particular purpose
D) conformity to a sample or model

Question 48

Sal was at home going through his normal workout when he bent his barbell bar. Sal is a professional bodybuilder, and this fact is obvious from his appearance. Sal went to his local sporting-goods store and was approached by a clerk wishing to assist him. Sal told the clerk about his problem and the clerk asked Sal to wait while an appropriate bar was located. The clerk presented Sal with a bar that the clerk said "is just what you need for your type of weight requirements." Sal paid for the bar and was returning home when he stopped at a health food restaurant. The drink that he ordered had an unusual taste, but the food establishment refused a refund. Sal became ill from the drink, which, as it turned out, had a toxic substance in it. Sal had to be hospitalized. When Sal was able to work out again, he attached the weights to the new bar and lifted the bar under his chin. The bar snapped in the middle and severely cut Sal. Sal is angry about the drink and the barbell. What are the applicable warranties involved? Does Sal have a cause of action?

Question 49

Strict tort liability is applied:

A) independently of the UCC.
B) without regard to privity of contract.
C) despite negligence on the part of the plaintiff.
D) all of the above.

Question 50

Thelma purchased from Hall a used truck that had been manufactured by International Harvester. To work on the truck engine, Thelma had to have the cab of the truck raised. When it was so raised, the cab fell unexpectedly and fatally injured Thelma. Suit was brought for her wrongful death against Hall and International Harvester. The suit was based on theories of negligence, strict tort liability, and breach of warranty. The defense was raised that there was no liability because the sale to Thelma had been made "as is" and the truck was a used truck. Were these defenses valid?

Question 51

A disclaimer or exclusion of the warranty of merchantability will be invalid if:

A) the goods cost $500 or more.
B) the defects in the goods are obvious to all buyers.
C) it is made at the time of the sale.
D) it is not conspicuously set forth in a writing.

Question 52

With used or secondhand goods, what is fit for normal use will be:

A) a higher standard than with new goods.
B) a lower standard than with new goods.
C) the same standard as with new goods.
D) a non-applicable standard, as the goods are not new.

Question 53

How do the warranty provisions under the CISG compare to the provisions of the UCC?

A) In most instances, the standards are the same.
B) In all instances, the standards are the same.
C) The CISG standards are stricter when compared to the UCC standards.
D) The standards are completely different.