Deck 20: Product Liability

Question 1

The preemption defense rests on a federal supremacy premise-the notion that federal law overrides state law when the two conflict or when state law stands in the way of the objectives underlying federal law.

Answer 1

True

Question 2

Punitive damages are awarded to compensate for the losses a person has suffered.

Answer 2

False

Question 3

In order to be liable under the implied warranty of merchantability, a seller must be a merchant.

Answer 3

True

Question 4

The owner of Café Coffee Day declaring that his restaurant makes the world's best cup of coffee is an example of an express warranty.

Question 5

A disclaimer of the implied warranty of merchantability must be in writing to be enforceable.

Question 6

Which of the following factors will be most important in determining if an express warranty has been created?

A) Whether the statements made by the seller were in writing.
B) Whether the seller intended to create a warranty.
C) Whether the promises became part of the basis of the bargain.
D) Whether the sale was made by a merchant in the regular course of business.

Question 7

Twentieth Century product liability law is best characterized by the phrase:

A) res ipsa loquitur.
B) caveat venditor.
C) caveat emptor.
D) laissez-faire.

Question 8

If a seller gives a written warranty for a product to a consumer, the warranty must be designated in the nature of full or limited warranty.

Question 9

Which of the following factors will be most important in determining whether an express warranty has been created concerning goods sold?

A) The seller's description of the goods formed the basis of the bargain.
B) The buyer or seller is a merchant with respect to the goods being sold.
C) The seller intended to create the express warranty.
D) The buyer relied on the seller's statements.

Question 10

A statement in an advertisement can sometimes be considered an "express warranty."

Question 11

A remedy limitation is more likely to be declared unconscionable in consumer cases involving personal injury.

Question 12

Joe buys some watermelon seed from a seed manufacturer's catalog. The catalog describes the seed Joe buys as "top quality." Joe strongly relies upon this statement in making the purchase. The seed turns out to be worthless, and Joe sues the manufacturer for breach of express warranty. You are the attorney representing the manufacturer. Which of the following is your best argument for escaping liability?

A) That a catalogue statement cannot create an express warranty.
B) That the basis-of-the-bargain requirement was not met.
C) That the alleged warranty was merely sales talk.
D) That the manufacturer did not give a sample or a model of the seed.

Question 13

When determining whether a manufacturer was negligent in adopting a particular design, courts frequently supplement the above factors with an analysis known as the utilitarian test.

Question 14

A description that gives rise to an express warranty under which the goods must be as described, amounts to an express warranty regarding quality or duration of the goods' future performance.

Question 15

A disclaimer is a clause attempting to block recovery of certain damages.

Question 16

Basis-of-the-bargain damages are almost always successfully awarded in tort cases.

Question 17

Which of the following is an express or implied promise about the nature of the product sold?

A) Warranty
B) Caveat
C) Advertisement
D) License

Question 18

The increasing use of comparative principles in product liability cases is due to the popularity of the three traditional defenses used in product liability cases.

Question 19

A disclaimer of the implied warranty of merchantability can be oral.

Question 20

Jones purchased a second hand car from Ralph with an assurance of no problems in the car. Jones will succeed in his claim under express warranty.

Question 21

Under the product liability theory of recovery known as strict liability, which parties may be held liable? (Answer using the majority rule used in most States.)

A) The manufacturer only, engaged in the business of making that product.
B) Any seller who is a nonmerchant.
C) The wholesaler only, engaged in the business of selling that product.
D) The buyer of the product.

Question 22

According to UCC § 2-315's _____ for a particular purpose arises when the seller has reason to know a particular purpose for which the buyer requires the goods.

A) express warranty
B) warranty of merchantability
C) implied warranty of fitness
D) multiple express warranties

Question 23

A(n) _____ is created by operation of law rather than the seller's express statements.

A) endorsement
B) advertisement
C) express warranty
D) implied warranty

Question 24

Joe is going on a "survival hike" in the desert. He goes to a sporting goods store, describes the hike, and asks the salesman to select suitable hiking boots for him. The boots the salesman suggests are well made and are appropriate for normal hiking, but are not suitable for Joe's planned ordeal. Relying on the salesman's selection, Joe buys the boots. After he suffers personal injury because the boots prove inadequate for the survival hike, Joe sues the store. Joe can recover under:

A) the implied warranty of merchantability.
B) the implied warranty of fitness.
C) both the implied warranty of fitness and the implied warranty of merchantability.
D) Joe cannot sue fro breach because it was his responsibility to select the boots.

Question 25

In order to recover for breach of an express warranty, a plaintiff must show that:

A) the warranty was part of the basis of the bargain.
B) the seller gave a sample or model of the goods.
C) the warranty was in writing.
D) the warranty used the words "warrant" or "guarantee."

Question 26

Goods that are not "merchantable" are:

A) unfit for any use.
B) unfit for the ordinary use for which such goods are used.
C) unfit for the particular use that the buyer intends.
D) unfit for the particular use that the buyer intends, and the buyer is a merchant.

Question 27

In the case of a product where the risks are open and obvious, many courts hold that:

A) buyers must register a complaint with the seller.
B) strict liability must be applied.
C) the case will be covered under section 402A.
D) there is no duty to warn.

Question 28

Which of the following doctrines often proves helpful to plaintiffs who bring a product liability lawsuit alleging negligence?

A) Res judicata
B) Res ipsa loquitur
C) Caveat venditor
D) Caveat emptor

Question 29

In order to establish a cause of action based upon strict liability in tort for personal injuries resulting from the use of a defective product, the plaintiff must start the case by proving that the seller (defendant):

A) was engaged in the business of selling the product.
B) failed to exercise due care.
C) defectively designed the product.
D) was in privity of contract with the plaintiff.

Question 30

The implied warranty of fitness for a particular purpose is violated when the goods are:

A) unfit for any use.
B) unfit for the ordinary use for which such goods are used.
C) unfit for the particular use that the buyer intends.
D) unfit for the particular use that the buyer intends, and the buyer is a merchant.

Question 31

The Elle Corporation manufactures fingernail polish. Suzy buys a container of Elle's fingernail polish, applies it to her nails, and suffers a severe allergic reaction. She sues Elle under the implied warranty of merchantability. The test for determining whether Suzy will recover is whether:

A) the nail polish she bought was suitable for the needs of the average consumer.
B) the nail polish she bought properly performed its function of coloring one's nails.
C) such a reaction in an appreciable number of consumers was reasonably foreseeable.
D) the ingredient causing the reaction was foreign to the nail polish, or natural to it.

Question 32

Ahmed, a lawyer, sold his car to Carlos. Has an implied warranty of merchantability been created by this transaction?

A) Yes, because a car is "goods" and the Uniform Commercial Code applies to contracts for the sale of goods.
B) Yes, because if the car is defective Carlos will have a right to return in to Ahmed.
C) No, because Ahmed is not a merchant.
D) No, Ahmed has not implied so either orally or in written.

Question 33

The most important requirement of goods regarding their merchantability is that they must:

A) be fit for the ordinary purposes for which they are used.
B) be passed without objection in the trade.
C) be adequately contained, packaged, and labeled.
D) conform to any promises or statements of fact made on the label.

Question 34

Which of the following will make the seller liable under section 402A ?

A) The seller must be engaged in selling the product that allegedly caused harm.
B) The product may not be in a defective condition but must have caused injury.
C) The seller must prove that suitable modifications were made to the product in order to avoid liability.
D) All cases except design-defect ones may be covered under this section.

Question 35

Which of the following statements characterizes an implied warranty of fitness?

A) It is covered under UCC section 402A.
B) The seller relies on the buyer's skill or judgment in making a purchase.
C) Any seller, merchant or nonmerchant may make this implied warranty.
D) It has the same tests as those for implied warranty of merchantability.

Question 36

Under the product liability theory of strict liability as expressed in the Restatement (Second) of torts, what is an essential fact that must be present if strict liability may be used in a lawsuit as the basis for recovery?

A) The product must be unreasonably dangerous.
B) The product must be un-merchantable.
C) The product must be unfit for the purpose intended by the buyer.
D) The product must be unfit for any purpose.

Question 37

Which of the following is most important for imposing strict liability?

A) Unavoidable circumstances
B) Unreasonably unsafe
C) Unreasonable expensive
D) Unavoidably protected

Question 38

Palmer goes to a truck dealership and asks for a truck capable of handling a 5000-pound load. He makes it clear that it is up to the salesman to select an appropriate truck. Without saying anything about the truck's load-carrying capacity, the salesman selects a certain truck for Palmer. Relying on the salesman's choice, Palmer buys the truck in question. However, the truck can only handle a 2500-pound load. Palmer wants to sue the dealership because he didn't get the truck he desired. Which of the following product liability theories gives Palmer his best chance of recovery?

A) Express warranty
B) Implied warranty of fitness
C) Implied warranty of merchantability
D) Section 402A

Question 39

Which of the following would be most suitable to be tried under comment k of section 402A of the Restatements (Second) of Torts?

A) Cases related to development of medicines
B) Cases of manufacturing defect
C) Cases of design defect
D) Cases of failure-to-warn

Question 40

Which of the following distinguishes the Restatement (Third) from section 402A?

A) It covers design defects.
B) It covers manufacturing defects.
C) It does not require that the product be unreasonably dangerous.
D) It covers sellers engaged in selling the product that harmed the plaintiff.

Question 41

_____ is the plaintiff's voluntary consent to a known danger.

A) Contributory negligence
B) Product misuse
C) No privity
D) Assumption of risk

Question 42

Delbert Cars sells Jim a nice new model. Unfortunately for Jim, a defect in the car's brakes causes them to fail; in turn causing an accident that totals the car and puts Jim in the hospital. Jim sues (among others) Delbert, arguing that Delbert was negligent in failing to inspect the brakes for defects. All Delbert did was to drive the car around the block to see if it ran as it should. Under what conditions might Delbert be liable here? Under what conditions will it escape liability?

Question 43

Which damages are especially awarded by the court to punish the defendant?

A) Punitive
B) Compensatory
C) Monetary
D) Liquidated

Question 44

Sellers of goods sometimes attempt to disclaim (avoid) their liability under warranties. Which type of warranty disclaimers must be written in order to be effective?

A) Disclaimers of industrywide liabilities.
B) Disclaimers of the warranty of fitness for a particular purpose.
C) Disclaimers of the warranty of the Magnuson-Moss Act.
D) Disclaimers of the warranty of strict liability.

Question 45

Adam decides to eat food despite knowing that it is adulterated and brags about it to Dee. Later Adam falls sick from infection. Adam sues the supplier of the said food for injury suffered by him. The defense which can be taken by the food supplier is:

A) contributory negligence.
B) assumption of risk.
C) product misuse.
D) comparative responsibility.

Question 46

Which of the following factors is most important in determining whether a manufacturer is strictly liable in tort for a defective product?

A) The negligence of the manufacturer.
B) The contributory negligence of the plaintiff.
C) Modifications to the product by the wholesaler.
D) Whether the product caused injuries.

Question 47

Bob, an attorney, purchased licensed software from Bill Able Inc. to prepare his clients' invoices online. The shrinkwrap packaging for the program disks and the software manuals contained a limitations of remedies clause which limited the buyer's remedies to the $50.00 purchase price of the software. Bob later discovered that his invoices for the past year were too low due to a malfunction in the software, costing him over $10,000 in lost revenue. Bob sues Bill Able Inc. for breach of warranty. What is the likely result?

A) Bob wins because he has equal bargaining power with Bill Able, Inc.
B) Bob wins because such shrinkwrap limitations of remedies clauses are generally unenforceable.
C) Bob loses because the court will likely view the limitations of remedies clause as conscionable and enforceable.
D) Bob loses because the disclaimer is effective.

Question 48

Lazur Corp. entered into a contract with Baker Suppliers, Inc. to purchase a used word processor from Baker. Lazur was engaged in the business of selling new and used word processors to the general public. The contract required Baker to ship the goods to Lazur by common carrier pursuant to the following provision in the contract: "FOB - Baker Suppliers, Inc. loading dock." Baker also represented in the contract that the word processor had been used for only 10 hours by its previous owner. The contract included the provision that the word processor was being sold "as is" and this provision was in larger and different type style than the remainder of the contract. With regard to the contract between Lazur and Baker:

A) an implied warranty of merchantability does not arise unless both Lazur and Baker are merchants.
B) the "as is" provision effectively disclaims the implied warranty of title.
C) no express warranties are created by the contract.
D) the "as is" provision would not prevent Baker from being liable for a breach of any express warranties created by the contract.

Question 49

Several firms within an industry are involved in manufacturing a harmful product. It is impossible to prove which firm produced the product and caused injury. Identify the type of liability that would arise in these circumstances.

A) Industrywide Liability
B) Strict Liability
C) No-privity determination
D) Breach of expresses warranty

Question 50

A(n) _____ is a clause attempting to block recovery of certain damages.

A) promissory estoppel
B) condition subsequent
C) implied waranty
D) remedy limitation

Question 51

Steve weighs 465 pounds and looks like it. Steve goes to a store and says that he would like to buy a hammock suitable for someone like himself to sleep in. He makes it clear that it is up to the salesman to select a suitable hammock. The salesman selects a hammock that is perfectly suitable for a normally-sized person but that cannot support someone of Steve's weight. Relying on the salesman's recommendation, Steve buys the hammock. After he is injured when the hammock collapses because it cannot bear his weight, Steve sues the store. Can Steve recover under the implied warranty of merchantability? Assume that the store is a merchant with respect to hammocks.

Question 52

Which of the following is used by sellers to eliminate any kind of liability that may be claimed by an injured buyer?

A) Warranty
B) Disclaimer
C) Warning
D) Advertisement

Question 53

A seller's ability to disclaim implied warranties is sometimes restricted by the doctrine of:

A) unconscionability.
B) remedy limitation.
C) no-privity.
D) commercial impracticability.

Question 54

In January 2003, Evan sold a television set that he stated as "HDTV ready" to Zora. Three months later, Zora learned that the television set was not "HDTV ready." For each of the three major views on the "part of the basis of the bargain" requirement for express warranty liability under UCC Section 2-313, explain what the court will need to know before making a decision.

Question 55

Jason sold Sally a car manufactured by ABC Corp. After driving the car for a couple hours, Sally found that the brakes did not function properly making it extremely difficult for her to control the car. When she finally reached home, she rang up Jason demanding her money back. Jason claimed that she should ideally talk with ABC Corp., who was the manufacturers. According to Jason, he was simply selling the car. Which of the following defenses is Jason using to save himself?

A) No-privity
B) Assumption of risk
C) Contributory negligence
D) Disclaimer

Question 56

Joe buys a bottle of Coca-Cola. When Joe spots a needle inside the bottle, his buddies dare him to drink the coke. After doing so, Joe suffers physical injury as the needle sticks in his throat. Joe sues Coke under section 402A; Coke defends by arguing assumption of risk on Joe's part. Transylvania court, however, has eliminated assumption of risk as a separate defense in product liability cases. Instead, it has a comparative fault statute just like the statute in the Jimenez case in the text. Under that statute, what is the result of Joe's lawsuit and why? Assume that Coke would be liable under section 402A.

Question 57

What is the usual UCC time limitation for claiming express and implied warranty after the sale of a product?

A) 12 months
B) 2 years
C) 4 years
D) 5 years

Question 58

Which of the following theories of recovery is likely to be most effective against a disclaimer of liability?

A) Express warranty
B) Implied warranty of merchantability
C) Implied warranty of fitness
D) Section 402A

Question 59

John buys a machine for $10,000 under a contract that excludes consequential damages and limits the buyer's remedies to repair and replacement of defective parts. John later discovers that the machine is not working properly. Under these circumstances if the remedy of limitation is enforceable, then, to what extent will John be successful?

A) John can recover $10,000.
B) John will have to pay an additional amount for any repairing done.
C) John is entitled to any damages since he did not check the machine on purchase.
D) John can only get the machined replaced or repaired by the seller.

Question 60

Toyota Automobiles launches a new model of SUV. The design of the car was such that the vehicle had a very broad rear. This posed a problem of parking the vehicle in the regular parking space. Adams, the owner of the SUV, had parked his car on one side of the road. Since the vehicle's rear was protruding onto the road, it was hit by a truck and was damaged. Under these circumstances, can Adams sue Toyota for a defective design? Are there any remedies for him to recover?