Deck 14: Sales: Product Advertising and Liability

Question 1

"This car has the finest workmanship money can buy" is an example of an express warranty.

Answer 1

False

Question 2

Privity is required for recovery on the basis of warranty.

Answer 2

False

Question 3

Privity of contract is a direct contractual relationship between the parties.

Answer 3

True

Question 4

Section 402A permits suits only by those in privity of contract.

Question 5

To establish an express warranty under the UCC, the buyer must produce evidence that the seller used the term
"warrant" or "guarantee."

Question 6

There can be no recovery on the basis of a breach of a UCC warranty by anyone other than the actual buyer.

Question 7

"These dresses are 100% cotton" is an example of an express warranty.

Question 8

A sale of a toaster at a garage sale is covered by the warranty of merchantability.

Question 9

The language "as is" disclaims both the warranty of merchantability and the warranty of fitness for a particular purpose.

Question 10

A lack of adequate warnings can be a defective product.

Question 11

Strict tort liability under Section 402A is the same as negligence.

Question 12

When a customer tells a pet store employee that she wants two female gerbils, but receives one male and one female gerbil who later have baby gerbils, the pet store has breached the implied warranty of fitness for a particular purpose.

Question 13

A product can be defective for purposes of liability for injury if proper warnings about its use are not given.

Question 14

Today, courts follow a policy of caveat emptor in handling product liability cases.

Question 15

Misuse of a product is a defense in a product liability suit.

Question 16

The implied warranty of fitness for a particular purpose (unless disclaimed) is given in every sale of goods by a merchant.

Question 17

The implied warranty of merchantability (unless disclaimed) is given in every sale of goods by a merchant.

Question 18

Today, courts require privity of contract for recovery in product liability cases.

Question 19

Caveat emptor is a Latin term meaning "let the buyer beware."

Question 20

Improper packaging that results in an injury can be a basis for product liability.

Question 21

Toyota had no ethical obligation to issue a recall on its vehicles with sudden unintended acceleration problems because Toyota did not manufacture the parts that caused the problems.

Question 22

Federal trademark law provisions provide remedies for companies whose products are misrepresented in comparative advertising.

Question 23

Ads by members of professional groups can be regulated by the state.

Question 24

Celebrity endorsements of products are deceptive unless the celebrity has used the product.

Question 25

Proof for a breach of the warranty of merchantability suit requires establishment of the fact that the product was in a defective and unreasonably dangerous condition.

Question 26

The Federal Trade Commission does not have the authority to halt deceptive ads.

Question 27

"Stops assailants dead in their tracks," written on the package for a mace product, is an express warranty.

Question 28

Ads can be a basis for an express warranty.

Question 29

The implied warranty of fitness for a particular purpose is given in every sale by a merchant.

Question 30

Private parties can enforce the FTC regulations on comparative ads.

Question 31

A disclaimer of liability for personal injuries caused by a breach of warranty would be unconscionable.

Question 32

Express warranties cannot be disclaimed.

Question 33

Corrective ads can be required only when competition is affected.

Question 34

Bait and switch is not a deceptive advertising technique.

Question 35

The Consumer Product Safety Improvement Act of 2008 includes rules covering the resale of goods such as in a garage sale.

Question 36

In comparative advertising, a company cannot be held liable for misrepresentations regarding products other than its own.

Question 37

A consent decree is similar to a no-contest plea in a criminal proceeding.

Question 38

The Federal Trade Commission is responsible for the regulation of deceptive advertising.

Question 39

Stating a lamp is a "Tiffany lamp" and stating it is "in the Tiffany style" are both making the same kind of warranty.

Question 40

Proof of negligence in product design or manufacture allows recovery of punitive damages.

Question 41

The FTC can issue an order to halt a comparative ad if information used in the ad is inaccurate.

Question 42

If there is a breach of the warranty of merchantability, there is no tort liability.

Question 43

Product packaging stating that the line is "ideal for use on boat or dock" is mere puffery and not an express
warranty.

Question 44

Restaurants have no liability for natural items such as bones in chicken that injure customers.

Question 45

The implied warranty of merchantability requires:

A) proof that the seller is a merchant.
B) proof that the buyer relied on a merchant.
C) proof of a defective product.
D) all of the above

Question 46

An internal memo in a company that acknowledges the risk of a product prior to the product's release without any kind of change establishes proof for punitive damages under a negligence theory of product liability.

Question 47

The implied warranty of fitness for a particular purpose requires:

A) proof that the seller made the first contact with the buyer.
B) proof that the seller used the term "warrant."
C) proof that the seller is a merchant.
D) none of the above

Question 48

Passengers injured in a plane crash caused by the plane's defective design have no rights of recovery against the
airplane manufacturer.

Question 49

A salesperson who recommends a fertilizer to a customer for the customer's described purposes is not making a
warranty.

Question 50

Under the Consumer Product Safety Improvement Act a reseller of goods cannot be liable for selling toys or other products with lead paint because the reseller did not manufacture the goods.

Question 51

A purchase of a deep fryer at a sale of a bankrupt restaurant's equipment by the bankruptcy trustee is covered by
the warranty of merchantability.

Question 52

Proof that a manufacturer was aware of a defect in its product but did not correct it is proof of negligence.

Question 53

The FTC Improvements Act of 1980 curbed FTC regulation of children's advertising.

Question 54

Which is a requirement for an express warranty?

A) use of the word "warrant" or "guarantee"
B) a description or promise of performance
C) written statement
D) must be made by a merchant

Question 55

Which of the following is not an example of an express warranty?

A) "This jacket is lined."
B) "This water heater holds 50 gallons."
C) "This toothpaste makes teeth the whitest around."
D) "Preshrunk jeans."

Question 56

Comparative ads are now illegal.

Question 57

The foreign/natural test for food items is different from the liability issues under the reasonable expectation test.

Question 58

"As is" written in a contract:

A) serves to disclaim the implied warranty of merchantability.
B) serves to disclaim the implied warranty of fitness for a particular purpose.
C) has no effect on warranty protection.
D) both a and b
E) none of the above

Question 59

The implied warranty of fitness for a particular purpose requires reliance by the buyer on the seller's expertise.

Question 60

The implied warranty of merchantability requires proof that the buyer was relying on some language when he or she made the purchase of the good.

Question 61

Ralph Walters wanted to begin an exercise program and decided to enroll in a local aerobics class. He was told that he would need proper aerobic work-out shoes. Ralph went to an athletic shoe store and explained his needs to the sales clerk and also added that since he had never done aerobics, he was unsure what type of shoe he would need. The sales clerk recommended a shoe that Ralph purchased. When Ralph arrived at aerobics class, his instructor said his shoes were not appropriate for aerobics and that Ralph might injure himself if he used them for the workout. When Ralph returned to the store with the shoes, the store refused to exchange them, citing the three-day limitation on returns. Suppose Ralph's sales receipt had stamped on it in red letters "AS IS." The shoe store:

A) has breached the implied warranty of fitness for a particular purpose and is required to refund Ralph's money or exchange the shoes.
B) is within its rights to refuse to take the shoes back.
C) has not breached any warranty since Ralph had no contract with any promises written in it.
D) none of the above

Question 62

Which of the following would not be a basis for a negligence product liability suit?

A) a highly explosive gas tank installed in a car with the manufacturer's prior knowledge of its dangers
B) the continued sale of sunglasses to baseball teams knowing the sunglasses shatter
C) the continued sale of gas pipelines to utilities in the Southwest after explosions caused by peculiar interactions of the pipe with the soil and heat
D) All of the above would be negligence product liability suits.

Question 63

The opposite of caveat emptor is:

A) negligence.
B) privity requirements.
C) strict tort liability.
D) none of the above

Question 64

For an injured party to recover for breach of a UCC warranty under the UCC:

A) there must be privity of contract.
B) even under the strictest alternative, the party can be a guest.
C) he/she must be a natural person.
D) none of the above

Question 65

Section 402A covers:

A) manufacturers only.
B) retailers only.
C) those who sell products out of their home.
D) only merchants.

Question 66

Which of the following does not constitute an express warranty?

A) "This computer system is accessible by a PB2400 modem."
B) "This computer system is IBM-compatible."
C) "This computer system has a built-in battery back-up system that gives you two minutes to save files in the event of a power interruption."
D) All of the above are express warranties.

Question 67

Which of the following duties could not be a basis for a negligence suit?

A) hotel to guest
B) physician to patient
C) accountant to client
D) All of the above parties have duties.

Question 68

"These cartons will hold up to 100 pounds of books" is an example of:

A) an implied warranty of merchantability.
B) an express warranty.
C) misrepresentation.
D) privity.

Question 69

Which of the following would not be a breach of the warranty of merchantability?

A) a piece of garden snake in a box of frozen green beans
B) a caterpillar in broccoli soup purchased at a restaurant
C) a milk carton that leaks
D) All of the above are breaches of the implied warranty of merchantability.

Question 70

Which of the following does not constitute an express warranty?

A) "This car will give you a great deal of satisfaction."
B) "This car is equipped with Michelin radial tires."
C) "This car goes from 0 to 60 mph in 10 seconds."
D) All of the above are express warranties.

Question 71

Susan Hewitt is eating a bowl of cream of broccoli soup in a bistro when she notices a portion of a caterpillar on her spoon. Susan's best basis for recovery is:

A) implied warranty of merchantability.
B) negligence.
C) implied warranty of fitness for a particular purpose.
D) none, there is no privity

Question 72

"With all faults" serves to disclaim:

A) an express warranty.
B) liability under 402A.
C) liability for negligence.
D) none of the above

Question 73

Negligence product liability cases:

A) are the same as 402A cases.
B) have no defenses.
C) require proof of privity.
D) none of the above

Question 74

Contributory negligence:

A) can be a partial defense in product liability cases for negligence.
B) is the same as comparative negligence.
C) is no longer permitted as evidence in suits.
D) none of the above

Question 75

Privity in negligence product liability cases is:

A) not required.
B) more stringent than in UCC cases.
C) determined by the relationship of the injured party to the buyer.
D) none of the above

Question 76

The term "AS THEY STAND" serves to disclaim:

A) the implied warranty of merchantability.
B) the implied warranty of fitness for a particular purpose.
C) both a and b
D) none of the above unless it is in writing

Question 77

Ralph Walters wanted to begin an exercise program and decided to enroll in a local aerobics class. He was told that he would need proper aerobic work-out shoes. Ralph went to an athletic shoe store and explained his needs to the sales clerk and also added that since he had never done aerobics, he was unsure what type of shoe he would need. The sales clerk recommended a shoe that Ralph purchased. When Ralph arrived at aerobics class, his instructor said his shoes were not appropriate for aerobics and that Ralph might injure himself if he used them for the workout. When Ralph returned to the store with the shoes, the store refused to exchange them, citing the three-day limitation on returns. The shoe store:

A) is within its rights to refuse to take the shoes back.
B) has breached the implied warranty of fitness for a particular purpose and is required to refund Ralph's money or exchange the shoes.
C) has not breached any warranty since Ralph had no contract with any promises written in it.
D) none of the above

Question 78

The 2008 act that includes some regulations on the resale of goods is the:

A) Consumer Product Safety Act.
B) Consumer Product Resale Safety Act.
C) Consumer Product Safety Improvement Act.
D) Consumer Product Resellers Inclusion Act.

Question 79

The UCC warranty of merchantability:

A) does not cover sales of food in restaurants.
B) can be disclaimed by using the term "as is."
C) is made in every sale of goods.
D) none of the above

Question 80

Which of the following would be a "defect" for purposes of 402A?

A) failure to warn not to put a hair dryer in water
B) food package that permits tampering
C) a missing bolt on a car steering column
D) all of the above