Deck 20: Performance and Breach

Question 1

The doctrine of commercial impracticability only extends to problems that are unforeseen.

Answer 1

True

Question 2

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

Answer 2

False

Question 3

An installment contract is breached if a buyer accepts any nonconforming goods.

Answer 3

False

Question 4

An installment contract is breached if a seller tenders any nonconforming goods.

Question 5

If the goods or their tender fail to conform to the contract,the buyer can accept part and reject part.

Question 6

A shipment contract requires that the seller deliver the goods to a particular location.

Question 7

An installment contract is a single contract that requires or authorizes delivery in two or more separate lots to be paid for in one payment.

Question 8

Under the UCC,a seller's tender of goods that do not conform in every way to a contract is still a valid tender.

Question 9

Once the time for performance under the contract has expired,the seller or lessor can never exercise the right to cure.

Question 10

The seller's or lessor's major obligation under a sales contract is to tender conforming goods to the buyer or lessee.

Question 11

If a contract specifies a certain carrier,a substitution of a different carrier for any reason breaches the contract.

Question 12

Under the UCC,if a contract does not designate the place of delivery for the goods,and the buyer is expected to pick them up,then the place of delivery must be at a location halfway between the seller's place of business and the buyer's place of business.

Question 13

Under the UCC,there are no exceptions to the perfect tender rule.

Question 14

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

Question 15

Under the perfect tender rule,if tender is not perfect,the seller is obligated to try again.

Question 16

Tender of delivery requires that the seller or lessor hold the goods at the buyer's or lessee's disposal,but not that the goods be conforming.

Question 17

The obligation of good faith underlies every contract under the Uniform Commercial Code.

Question 18

In contracts involving a carrier,a seller can complete performance through a shipment contract or a destination contract.

Question 19

There are no circumstances under which a contract can be tendered by multiple deliveries of goods.

Question 20

Tender must occur at a reasonable hour and in a reasonable manner.

Question 21

Sparkling Gem Corporation agrees to sell Jewel Outlets,Inc.(JOI),fifty new diamonds,but the contract does not specify a place of delivery.JOI is expected to pick up the goods.The place of delivery is

A)Sparkling's place of business.
B)JOI's place of business.
C)the Annual Gems and Jewels Convention in New York City.
D)the U.S.Postal Service office nearest to JOI's place of business.

Question 22

A contract for a sale of a certain quantity of drum kits from Rimshot Drum Company to Musicians Warehouse specifies Urban City as the place for delivery but leaves open the particular address.Obliged to specify the address is

A)Rimshot Drum Company.
B)Musicians Warehouse.
C)the Urban City Chamber of Commerce.
D)the appropriate state officer (usually the secretary of state).

Question 23

If a seller asks a buyer to store nonconforming goods overnight,then the buyer is entitled to reimbursement for the costs involved.

Question 24

A buyer may reject a seller's goods under any circumstances.

Question 25

If goods identified to a contract are destroyed through no fault of either party,both parties are excused from performance.

Question 26

On a lessee's insolvency,the lessor can stop delivery of the goods.

Question 27

In general,a buyer's duty to pay for tendered goods becomes absolute be?fore the buyer has had an opportunity to inspect the goods.

Question 28

Clear Day Company,which is based in Delaware,agrees to sell fifty windows,currently stored in Florida,to Far Vu,Inc.,which is based in Hawaii.Absent an agreement to the contrary,the place of deliv?ery is in

A)California.
B)Delaware.
C)Florida.
D)Hawaii.

Question 29

If a seller repudiates a contract,the buyer's damages do not have to be adjusted to reflect any expenses that were saved as a result of the breach.

Question 30

If a buyer breaches a contract while the seller is still in possession of the goods,the seller can resell the goods and hold the buyer liable for any loss.

Question 31

If a seller discovers that the buyer has received goods on credit and is insolvent,the seller can only demand the return of the goods if he or she does so on the same day that the buyer received the goods.

Question 32

Big Eggs,Inc.agrees to supply Omelet Express with five hundred eggs.Big Eggs cannot reasonably ask Omelet Express to pick up the eggs at

A)1:00 P.M.
B)2:00 P.M.
C)3:00 P.M.
D)4:30 A.M.

Question 33

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

Question 34

If a buyer repudiates a contract,the seller cannot re?cover damages.

Question 35

Once the seller has tendered delivery,the buyer is obligated to accept the goods and pay for them.

Question 36

If a seller fails to deliver the goods,the buyer's damages do not include all losses resulting from this course of events.

Question 37

Pleasant Valley Dairy agrees to sell a certain quantity of ice cream to Coffee & Dessert Caterers,but their contract does not specify the address at which the goods are to be delivered.If the parties fail to specify the address before the delivery date

A)Pleasant Valley Dairy is excused for any resulting delay.
B)Pleasant Valley Dairy is liable for any resulting delay.
C)the time for delivery is extended with a price adjustment for the delay.
D)the contract is canceled.

Question 38

If a lessee wrongfully refuses to accept goods that conform to a contract,the lessor must tender substitute goods.

Question 39

If,before the time for performance,a buyer communicates an intent not to perform,the seller can consider the buyer in breach and pursue a remedy.

Question 40

Unless otherwise agreed,inspection of goods can take place at any reasonable place and time and in any reasonable manner.

Question 41

Beef Burgers,Inc.contracts to buy five hundred steers from Fattening Feedlots.Before Fattening Feedlots can deliver the steers,there is an outbreak of disease in the feedlot,and all the cattle are quarantined.In this case the perfect tender rule

A)applies to both parties.
B)does not apply.
C)applies only to Beef Burgers.
D)applies only to Fattening Feedlots.

Question 42

Sof' Chair Company contracts to deliver 100 chairs to Stuffy Furnishings Store on May 1 for which Stuffy agrees to pay.Sof' tells Stuffy on April 15 that delivery will be delayed until June 1.Stuffy may

A)await performance,sue Sof',or suspend its own performance.
B)only await Sof's performance for a commercially reasonable time.
C)only sue Sof' for breach of contract.
D)only suspend its own performance.

Question 43

Office Suppliers,Inc.and Little Office Shop enter into a contract for a sale of office supplies.Office Suppliers is the seller.Under a shipment contract,the Office Suppliers does NOT have to

A)obtain and promptly deliver or tender to the buyer any documents necessary to enable the buyer to obtain the goods.
B)deliver the goods to a particular destination.
C)put the goods in the hands of the carrier.
D)promptly notify the buyer when the shipment has been made.

Question 44

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 45

On January 10,Winchester Pet Supplies orders fifty small dog collars from Quality Collars,Inc.to be delivered by January 15.On January 13,Quality Collars tenders fifty large dog collars.Winchester Pet Supplies rejects the shipment.Quality Collars has

A)no right to cure.
B)until January 15 to cure.
C)until the end of the business day on January 13 to cure.
D)unlimited time to cure.

Question 46

Pine Mills Corporation and Ur-Choice Lumberyards enter into a contract for a sale of plywood.Under a destination contract,the seller must

A)allow the buyer to reject the goods for any reason.
B)deliver the goods to a particular destination.
C)inspect the goods before tendering their delivery.
D)place the goods into the hands of a carrier.

Question 47

Mineral Resource Company contracts to provide several manufacturers with tin.When a cartel of tin-producing countries suddenly embargoes future shipments of tin to Mineral Resource so that it cannot fulfill its contracts,the distributor

A)can substitute some other material for the tin.
B)is excused from the performance of its contracts.
C)is liable for breach of contract.
D)must still supply the tin needs of its customers.

Question 48

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 49

Silas Paving Co.contracts to buy some construction machinery from Massive Earthmovers,Inc.Before either party performs,Massive sells its assets to Phoenix Equipment Corp.On learning of the sale,Silas is concerned about its contract with Massive.Silas should

A)demand assurances of performance from Massive.
B)consider the contract repudiated and sue Massive for breach.
C)buy the machinery from a different supplier and bill Massive for the price.
D)buy the machinery from a different supplier and bill Phoenix for the price.

Question 50

Sally's Sweet Fruits contracts with Fruits to You,Inc.for a delivery of two hundred pounds of strawberries to be delivered by Keep Kool Trucking,a trucking company with refrigerated trucks.On the day of delivery,the refrigeration units on Keep Kool's trucks are not working.Fruits to You

A)may ship the goods to Sally's using another trucking company with refrigerated trucks.
B)must refund Sally's money and cancel the contract.
C)must wait to ship the strawberries until Keep Kool has fixed its trucks.
D)must ship the goods through a different carrier and pay Sally incidental damages.

Question 51

Genuine Seed Company and Hillside Farmers Cooperative enter into a contract for a sale of hybrid seeds.Under the perfect tender rule,Genuine Seed must ship or tender seeds to Hillside 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 52

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 53

Kim's Pony Rides orders ten saddles from Little Horse Saddles,Inc.The sales contract states that if the saddles are defective,Kim's will allow Little Horse Saddles to repair or replace them instead of rejecting the shipment.When the saddles arrive,they are defective.In this case,the perfect tender rule

A)does not apply.
B)applies to both parties.
C)applies only to Little Horse Saddles.
D)applies only to Kim's Pony Rides.

Question 54

Food Packaging,Inc.,agrees to sell 50,000 6-ounce yogurt containers to Golden Dairy Company.Food can obtain only 20,000 of the 6-ounce contain?ers,but also ships 30,000 more expensive 8-ounce containers for the same price.Under these circumstances,Golden

A)cannot reject delivery,and Food cannot later replace the containers.
B)cannot reject delivery,but Food can later replace the containers.
C)may reject delivery,and notice to Golden of Food's intent to cure will give Food a reasonable time to replace the containers.
D)may reject delivery,but Food cannot later replace the containers.

Question 55

Julia orders twelve violins for her music shop from Notable Notes Instrument Manufacturers.The sale is made on credit.Julia orders the violins on May 1,Notable Notes ships the violins on May 2,and Julia receives the violins on May 4.Julia sells all the violins by June 15.Julia's credit period most likely began on

A)May 1.
B)May 2.
C)May 4.
D)June 15.

Question 56

Levi's Toy Store orders one hundred board games from Big Board Games Warehouse.When the games are delivered,they are all missing pieces.Levi's Toy Store rejects the shipment.Big Board Games wants to cure.Big Board Games must

A)promptly notify Levi's Toy Store of the intent to cure.
B)pay Levi's Toy store a cure fee.
C)send a truck to pick up the nonconforming goods before the end of the business day.
D)create a new contract with Levi's Toy Store.

Question 57

Shane's Auto Parts orders twenty tires from Tough Tires,Inc.The truck delivering the tires to Shane's is in an accident and ten of the tires are damaged.Shane's Auto Parts

A)cannot reject the entire shipment.
B)must still pay for all twenty tires at the original contract price.
C)may inspect the tires and accept the shipment with a reduction in price.
D)must reject the entire shipment.

Question 58

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 59

Garden Field Farms and Haute Gourmet Restaurant,Inc.,enter into a con?tract for a sale of lettuce before Haute Gourmet becomes insolvent.Garden Field can stop delivery of the goods in transit

A)unless Haute Gourmet pays on credit.
B)under no circumstances.
C)unless Haute Gourmet files a claim for the goods.
D)unless Haute Gourmet pays in cash.

Question 60

Elegant Carpets,Inc.,and Fantastic Floors Stores enter into a contract for a sale of carpeting.Under a shipment contract,the seller must

A)allow the buyer to reject the goods for any reason.
B)deliver the goods to a particular destination.
C)inspect the goods before shipping them.
D)place the goods into the hands of a carrier.

Question 61

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 62

Leatherbound Stores,Inc.,rejects a shipment of goods that does not conform to its contract with Cowhide Corporation,but is unable to obtain instructions from the seller.Leatherbound may

A)resell or return the goods only.
B)resell or store the goods only.
C)return or store the goods only.
D)resell,return,or store the goods.

Question 63

Natural Foods,Inc.,orders "Grade A" oil from Olive Grove Farms to process and sell to Pic 'N Pay Grocers.Olive Grove ships "Grade B" oil,which Natural Foods accepts.To recover damages for the nonconformity,Natural Foods must give notice of the breach within a reasonable time to

A)Olive Grove only.
B)Olive Grove,Pic 'N Pay,and the appropriate government agency.
C)Pic 'N Pay only.
D)the appropriate government agency only.

Question 64

Loomis Weaving Company contracts to sell sweaters to Style Mart stores.Before the sweat?ers are delivered,Style Mart indicates that it will not be able to pay.Loomis can resell the goods

A)either after finishing the job (and identifying the goods),or after stopping the job.
B)only after finishing the job and identifying the goods.
C)only if Loomis immediately stops the job.
D)under no circumstances.

Question 65

Ramblin' Country Stables contracts to buy 1,000 horseshoes from Blacksmith,Inc.,for $1 per shoe.When the market price decreases to 50 cents per shoe,Ramblin' refuses to go through with the deal.Blacksmith can recover

A)$1,500.
B)$1,000.
C)$500.
D)$0.

Question 66

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 67

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 68

Colby contracts in writing to sell his 2005 Dodge-brand pick-up truck to Efrem for $10,500.Colby agrees to deliver the truck on Friday,and Efrem promises to pay the $10,500 on the following Monday.On Thursday,Efrem tells Colby that he changed his mind and will not buy the truck.Over the weekend,Efrem changes his mind again and tenders $10,500 to Colby on Monday.Colby has not sold the truck to another party but refuses the tender and refuses to deliver.Efrem claims that Colby has breached their contract.Colby contends that Efrem's repudiation released him from his duty to perform under the contract.Who is correct,and why?

Question 69

Noni and Myra enter into a contract for a sale of clarinets and other wind instruments.Noni delivers,but Myra does not pay.Noni 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 70

Signal Sets Company contracts to deliver one hundred 52-inch plasma 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 71

Bayou Boats,Inc.,contracts for the sale of seven swamp boats to Eventide Fishing Tours.Bayou repudiates the contract.Eventide's recovery is measured at the time

A)Bayou advertised the goods.
B)Eventide ordered the goods.
C)Eventide learned of the breach.
D)Bayou knew that it would repudiate the contract.

Question 72

Summer Breeze,Inc.,contracts for the sale of fifty ceiling fans to Island Décor store.If Summer Breeze fails to deliver the goods,Island Décor must commence a suit for breach of contract within

A)four years.
B)not more than one year.
C)not less than four years.
D)thirty days.