Blaw chapter 20
Focus Camera Shop receives Sharpview-brand lenses from Optical, Inc., under a sale or return agreement. While the lenses are in Focus's possession, title is held by
Focus
Twyla buys a Voracious-brand bicycle from U-Pik-It Bike Store, which agrees to keep the bike for Twyla until she picks it up. Before Twyla gets the bike, a fire destroys the store and the bike. The loss of the bike is suffered by
U-Pik-It
Town Style Stores orders Hidebound-brand leather jackets from Cowhide & Cotton Company (CCC). CCC mistakenly ships denim jackets, which Town rejects and returns via Valu Transport, Inc. During the return, the jackets are lost. The loss is suffered by
CCC
Catchy Gadgets Corporation and Discount Outlets, Inc., enter into a contract for a sale of kitchenware. The contract requires Catchy to deliver the goods to Rapido Carrier Company for transport to Discount's warehouse. Risk of loss passes to Discount when
Catchy delivers the goods to Rapido
Essen Corporation buys from Fallow Farms, Inc., a rice crop that Fallow plans to plant and harvest during the next growing season. Essen plans to sell the rice to Gourmet Grocery Stores. After the rice is planted, but before it is harvested, an insurable interest in the rice exists in
Essen and Fallow, but not Gourmet Grocery
Sole Savers, Inc., and Rite Fit Footwear Stores enter into a contract for a sale of shoes. The contract indicates that the price includes transportation costs to a specific destination by including the term
F.O.B
Geno's Café orders five gallons of PureMaid-brand transfat-free olive oil from Chefs Supply, Inc. Chefs mistakenly ships soy oil, which Geno's keeps, despite the nonconformity. The oil is destroyed in a fire. The loss is suffered by
Geno's
Harley's Home Store buys furniture from Relax-a-by Furniture, Inc. The parties agree that the furniture will be shipped "F.O.B. Relax-a-by's ware- house" to Harley's via Jiffy Shipping Corporation. The furniture is lost in transit. The loss is suffered by
Harley's Home Store
Ferris is refinishing his kitchen floor and needs a floor sander to complete the job. Ferris's neighbor Gerda suggests that he call Home Repair Rentals, Inc. Home Repair leases Ferris a floor sander. In this transaction, the lessor is
Home Repair.
Jim's Jewelry Store orders Sho-Off-brand display racks from Kino's Merchandise Presentation, Inc. Kino's mistakenly ships racks of the wrong size and color, which Jim's rejects and returns via Longroad Shipping Company. During the return, the racks are lost. The loss is suffered by
Kino's
Leo buys a Naturo-brand bicycle from his brother, Mike. Mike agrees to keep the bike at his house until Leo picks it up. During a storm, a tree falls from Ogden's yard onto Mike's garage and destroys the bike. The loss of the bike is suffered by
Leo
Matrix Material Corporation in New Jersey sells fifty tons of fabric to Natural Fit Clothing, Inc., in Ohio, "F.O.B. New Jersey." Matrix arranges with Outbound Truckline to transport the goods. The cost of the transport will be paid by
Matrix
Mitchell buys 100 bales of hay from New Grain Fields. The parties agree that the hay will be transported "F.O.B. New Grain Fields" via Farm County Trucking Company. Farm County's truck and the hay are lost in a fire following an accident. The loss is suffered by
Mitchell
Medico Records Company orders thirty hard drives from Nano Computers, Inc. The hard drives are stored in Enviro Warehouse. Under the terms of the order, Nano must give Medico a warehouse receipt for the goods, which Medico will then pick up. Title to the goods passes to Medico when
Nano gives Medico a warehouse receipt for the drives
Office Reports Corporation (ORC) orders five Zippy-brand inkjet printers from Prime Printers, Inc. (PPI), to be delivered by PPI. Before PPI's truck arrives with the goods, ORC tells PPI it will not pay. The printers are destroyed in transit. The loss is suffered by
ORC to the extent of a deficiency in PPI's insurance coverage
NuStores accepts a shipment of QuikView-brand 3D HD DVD players from Open-Ur-Eyes, Inc. NuStores later discovers a defect in the players, revokes acceptance, and returns the players via Playback, Inc. During the return, the players are lost. The loss is suffered by
Open-Ur-Eyes
Orange Computer Corporation sells Pad-brand MP3 players to Quik Discount Stores and other retailers. Orange will have an insurable interest in the players as long as
Orange retains title to the goods
Pie Sales Corporation orders ReadyMade-brand pies from Savory Foods Company. Savory identifies the goods. Before they are shipped to Pie Sales, an insurable interest in the goods exists in
Pie Sales and Savory Foods
Finished Furnishings, Inc., agrees to lease an Oak Top-brand desk to Research Resources, Inc. (RRI), which agrees to pick it up at Streetside Warehouse. Before RRI retrieves the desk, it is stolen. The loss is suffered by
RRI
Juice Café buys 25 bags of Florida navel oranges from Sweet Citrus Company. The parties agree to ship the oranges "F.O.B. Juice Café" via Fresh Harvest Truckline. The oranges rot in transit. The loss is suffered by
Sweet Citrus
Suki leaves a Update-brand watch at Timepiece Sales & Repair to be fixed. Timepiece sells the watch to Vera, who does not know that the watch belongs to Suki. Suki can recover from
Timepiece
With a bill of lading, Cartage Common Carrier Company acknowledges possession of certain goods and contracts to deliver them. Cartage is
a bailee
Open Road Showroom sells new and used motorcycles. Some of the motorcycles are held on consignment, including six consigned by Pedro Cycles, Inc. Like most consignments, Open Road's deal with Pedro Cycles is
a bailment
Delicioso Tea Company and Savory Stores, Inc., enter into a contract for a sale of organic tea. The contract includes the term "F.O.B. River City," which is Savory's location. This means that the contract is
a destination contract
Commercial Storage (CS), a bailee, holds goods for Delta Distributors, Inc., which has contracted to sell them to Eagle Company. The goods are to be delivered without being moved. The risk of loss will pass to Eagle when Eagle receives
a negotiable document of title
County Dentists Clinic offers to buy from Dental & Medical Supplies Company a certain quantity of floss and other items for a certain price. Dental & Medical can ac¬cept the offer by
a promise to ship or a prompt shipment of the goods.
Laraby, a representative for Merchandise Shipping Company, delivers a bill of lading to Caitlin, the owner of Dockside Warehouse. A bill of lading is
a receipt for goods signed by a carrier
Marine Recreation, Inc., allows Nels to take a Marine Recreation boat for a "test run." Nels tries the boat for a few hours, returns, and buys it. This is
a sale on approval
Weightless Workouts, Inc., offers to sell a home gym to Jessica and sends it to her on a trial basis. This is
a sale on approval
Crest Jewelers buys diamonds from Paramount Gems to resell with the right to return the unsold stones in lieu of payment. This is
a sale or return
Lou's Bicycle Store contracts to buy fifty bicycles from Mountain Bikes, Inc. Unless the contract states otherwise, this is
a shipment contract
Textiles, Inc., and Fab Fabric Corporation enter into a contract for a sale of muslin. The terms do not clearly indicate whether it is a destination or shipment contract. A court would most likely presume that it is
a shipment contract
Diet & Health Food stores orders 1,000 boxes of granola bars from Energy Products, Inc., but fails to specify the varieties. The granola bars are delivered in an assortment of varieties. Diet & Health may
accept only the granola bars that it wants and reject the rest.
Savannah and Tim enter into a sales contract for orchids. With respect to the specific contractual provisions set out in the UCC, Savannah and Tim may
agree to whatever terms they wish.
A specific grade of corn that fills Dean and Ethel's silo is fungible. This means that the corn is
alike naturally or by agreement or trade usage
Wild Alaskan sockeye salmon that fill the hold of Dexter's fishing boat are fungible if the fish are
alike naturally, by agreement, or by trade usage
Over the course of a year, Suites & Sets Corporation sells household furnishings to customers to whom it extends credit. Suites & Sets orders the furnishings from The Storage Depot's warehouse, from which the items are shipped via common carrier to Suites & Sets customers. Article 2 of the UCC governs
all of the parties' sales of the goods.
Stop n' Gas Convenience Stores, Inc., is an East Coast-based firm that does business throughout the United States. With respect to this circumstance, the UCC has been adopted by, and applies in,
all of the states, in whole or in part.
La-Z Days Motels, Inc., and Beds R Us Corporation enter into a contract that does not specify the payment terms. Payment may be made in
any commercially normal or acceptable means.
Nature's Products, Inc., sends its standard order form to Omni Distribution Corporation to evidence a sale of packing materials. Omni responds with its own standard purchase order form. Additional terms in the purchase order automatically become part of the contract unless
any of the choices.
Dragonaire Corporation contracts with Excel Trucking Company to take goods to Fly-By Airlines, Inc., with Fly-By to transport the goods to a Geo Storage Company warehouse. Excel, Fly-By, and Geo each acknowledge possession of the goods by a document of title. Excel, Fly-By, and Geo are
bailees
Refined Grains, Inc., is a Kansas-based firm that does business throughout the world. Refined Grains manages retail and wholesale operations, buys and sells commercial venues, undeveloped land, and agricultural products, and other goods. Refined Grains has had to deal with employee and customer theft. With respect to these circumstances, the Uniform Commercial Code (UCC) provides a framework for
commercial transactions for the sale of and payment for goods.
iSharp, Inc., and Jenene, the owner of a Kitchen Time shop, orally agree to a sale of knives and other utensils for $12,000. Jenene gives iSharp a check for $4,000 as a partial payment. This contract is
enforceable to the extent of $4,000.
Leasing Equipment Corporation (LEC) agrees to lease five computer workstations to Mapmakers, Inc. Before any interest in the workstations can pass from LEC to Mapmakers, they must be
in existence and identified as the goods in the contract
Fresh Dairy, Inc., is the offeror and Gelato Ice Cream Company is the offeree under a unilateral sales contract in which Hector's Helado Corporation is also interested. Gelato is not notified of Fresh Dairy's performance within a rea¬son-able time. Gelato
may treat the offer as having lapsed.
Refer to Fact Pattern 20-B1. Ripe Produce files a suit against Southeast Asian, claiming that the buyer assumed the risk of the spoilage of the unsold goods. The court may allow evidence of this term if it finds that the parties' contract is
not fully integrated.
My-Tee Shirt Corporation orders from Celebrity Sales, Inc., goods that are stored in a Realty, Inc., warehouse. My-Tee pays for the goods, delivery is via the transfer of a negotiable warehouse receipt, and My-Tee moves the goods out of the warehouse. The risk of loss passes to My-Tee when it
receives the negotiable warehouse receipt
Heavy Equipment Corporation leases six forklifts to Inland Refining Company, but as the forklifts are delivered, they are lost in an explosion. Under the UCC, the parties' rights and obligations with respect to the loss depend on the concept of
risk of loss
Uri sells 100 cases of vitamins to Wanda, but before she takes physical possession, the cases are lost. Under the UCC, the parties' rights and obligations with respect to the loss depend on the concept of
risk of loss
Downtown Contractors and Equipment Rental Corporation are parties to an oral agreement for a one-year lease of a crane with payments totaling more than $10,000. They may satisfy the Statute of Frauds by
setting out the terms in a memo.
Rita orders 1,000 cases of 1/4-inch nuts from Steel Parts Company's 10,000- case lot. Steel Parts separates 1,000 cases from the lot. Title and risk of loss
shift to Rita when Steel Parts separates the cases
Great Gear, Inc., enters into a contract to sell sports clothing and equipment to Healthways Workout store, which in turn sells a pair of bike shorts to Ilene, a consumer. In comparison to standards that apply to consumers, the UCC imposes on merchants
special business standards.
Toro, S.A., which is based in Mexico, enters into a contract for the purchase of portable livestock fencing from United Fencing Company, which is based in the United States. This contract is governed by
the United Nations Convention on Contracts for the International Sale of Goods.
American Coffee Company and Beans Brokers, Inc., enter into a contract for the sale of a certain quality and quantity of coffee beans, with Beans Brokers to determine the price. The price must be set according to
the concept of good faith.
Ripe Produce, Inc., and Southeast Asian Bistro & Market enter into a contract for the delivery of locally grown fruits and vegetables. The parties use a standard Ripe Produce form that contains some of the terms the parties agree on but not others. Some of the produce spoils before it can be cooked, served, and eaten, or sold. Southeast Asian refuses to pay for the spoiled goods. Refer to Fact Pattern 20-B1. Ripe Produce responds that it did not waive payment for spoiled goods in the parties' previous transaction. Ripe Produce is arguing that the court should take into account
the course of dealing.
Global Outfitters Outlet and Hyacinth, a consumer, enter into a contract for a sale of ultra-weather camping gear. If the contract includes a clause that is perceived as grossly unfair to Hyacinth, its enforcement may be challenged under
the doctrine of unconscionability.
Perfect Poultry Company agrees to sell chicken, turkey, and other meats to Quik Markets, Inc., to sell to its customers. Normally, their contract would not be en¬forceable unless it includes
the quantity of the goods.
Refer to Fact Pattern 20-B1. Southeast Asian contends that the practice in the trade with respect to payment for spoiled produce justifies its refusal to pay. Southeast Asian is arguing that the court should take into account
the usage of trade.
Gene steals Hilary's brooch and sells it to Imelda. Hilary can recover the brooch from Imelda
under any circumstances
Corona Storage Company holds goods for Durango Sales Corporation, which contracts to sell them to El Dorado Stores, Inc. The goods are to be delivered without being moved and are represented by a negotiable bill of lading. The risk of loss passes to El Dorado
when El Dorado receives the bill of lading
