Fin240 Quiz 3 Kaplowitz

true

A U.S. firm can expand into international markets through a joint venture.

c. who temporarily cares for your personal property without passage of title.

A bailee is someone: a. who is also known as a buyer or lessee and can accept title of property. b. to whom you donate an item of personal property. c. who temporarily cares for your personal property without passage of title.

a. At the time when the seller separates the 5,000 pairs of women's jeans from the other items.

A buyer orders 5,000 pairs of women's jeans from a lot that contains 100,000 articles of men's, women's, and children's clothing. At what point does title and risk of loss no longer remain with the seller? a. At the time when the seller separates the 5,000 pairs of women's jeans from the other items. b. Whenever the 2 parties agree that title and risk of loss no longer remain with the seller. c. Exactly at the time the contract is formed.

False

A buyer promises to purchase only what he or she wishes to do so, so the promise constitutes a requirements contract.

d. a bearer instrument

A check made out to "cash" and signed by the writer is: a. a void instrument b. a revocable instrument c. an order instrument d. a bearer instrument

true

A fundamental function of negotiable instruments is to make sure that the instrument can be easily transferred without danger of being uncollectible.

true

A negotiable instrument can function as a substitute for cash or an extension of credit.

false

A seller can create an express warranty by making representations concerning good title.

c. does not render the note nonnegotiable

A statement in an instrument that only allows payment to be made from a designated fund: a. creates a conditional promise. b. renders the note nonnegotiable. c. does not render the note nonnegotiable.

a. must return the television because he has void title.

A thief steals Ahmed's $5,000 flat-screen TV. The thief sells it to Cody for $100. Ahmed attempts to recover the television from Cody, who did not know it was stolen. Cody: a. must return the television because he has void title. b. has no legal obligation to Ahmed because he is a bona fide purchaser. c. is a buyer in the ordinary course of business and therefore does not have to return the television.

True

A warehouse receipt is a receipt issued by a warehouser for goods stored in a warehouse.

b. finance lease.

Alyssa wants to purchase a large tent for use in her catering business, but she doesn't have the cash necessary to buy the tent. She convinces the owner of Ajax Supplies, an outdoor equipment store, to buy the tent from the tent's manufacturer and then lease it to her. They have created a a. trade usage lease. b. finance lease. c. consumer lease. d. utility lease.

a. one party communicates to the other an intention not to perform.

An anticipatory repudiation occurs when: a. one party communicates to the other an intention not to perform. b. the seller breaches after a conforming tender of the entire sale. c. the buyer breaches after tender of full payment. d. the seller breaches after a nonconforming tender.

c. the buyer never indicated any special purpose, nor war that special purpose obvious.

An implied warranty of fitness for a particular purpose normally will NOT arise when: a. the seller had reason to know the purpose. b. the buyer wrote down exactly what the goods were to be used for. c. the buyer never indicated any special purpose, nor was that special purpose obvious.

true

An implied warranty of merchantability and an implied warranty of fitness for a particular purpose, or both, can exist in addition to an expressed warranty.

true

An instrument is not negotiable unless it is payable to order or to bearer at the time it is issued or first comes into the possession of the holder.

True

Any goods that are not in existence at the time of contracting are known as future goods.

Goods, intangible, common

Article 2 deals with the sale of ____. It does not deal with real property (real estate), services, or _____ property such as stocks and bonds. Thus, if the subject matter of a dispute is goods, the UCC governs. It it is real estate or services, the ______ law applies.

contracts for the sale of goods

Article 2 of the UCC governs:

true

Assignment of a promissory note does not affect the maker's obligation to pay the note as promised.

turn over control of the litigation to the seller.

Assume that the seller agrees to defend and pay the expenses of an infringement lawsuit pursued against the buyer. What must the buyer then do?

true

Because a thief has no title to stolen goods, anytime the thief sells those goods, she or he has breached the warranty of title imposed by the UCC.

c. be allowed, and therefore the customer most likely will not prevail.

Bud's Trailers includes in its sales contracts a disclaimer in large boldface type stating "Trailers sold WITH NO WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE." When a customer sues because of losses of merchandise shipped in the trailer purchased from Bud's, the disclaimer will: a. not be allowed by the courts. b. be allowed, but because the customers used the trailer for a particular purpose, the customer will prevail. c. be allowed, and therefore the customer most likely will not prevail.

True

Businesspersons undertaking international sales transactions should draft specific forms to suit the needs of the particular transaction.

true

By means of arbitration clauses in international contracts, the parties agree in advance to be bound by the decision of a specified third party in the event of a dispute.

c. accepted the rose bushes.

Camille asks Geraldo to deliver four rose bushes from his nursery to her house. He does so and she plants them. After several weeks she still has not paid for them, Camille has: a. made a partial rejection of the rose bushes. b. exceeded the statute of limitations. c. accepted the rose bushes. d. made a full rejection of the rose bushes.

c. choice of forum clause

Charlotte, who is from the U.S., and Pierre, who is from France, have negotiated a contract that includes a provision establishing where a dispute will be litigated, otherwise known as a a. choice of language clause. b. force majeure clause. c. choice of forum clause. d. choice of law clause.

a. nonnegotiable because it calls for partial payment in shirts

Claude creates and signs a promissory note in which he promises to pay Audrey 1,000 euros, plus $1,000 worth of custom-made shirts on May 15th, in exchange for Audrey's help in renovating his kitchen. The note is: a. nonnegotiable because it calls for partial payment in shirts. b. negotiable because all of the elements of the note are valid. c. nonnegotiable because it calls for payment in euros.

d. nonnegotiable, because it calls for payment in shirts.

Claude creates and signs a promissory note. He promises to pay Audrey 1,000 euros plus $500 worth of custom-made shirts on October 15, in exchange for Audrey's help in renovating his kitchen. The note is a. negotiable, because all the elements of the note are valid. b. nonnegotiable, because it calls for payment in euros. c. nonnegotiable, because of Claude's signature. d. nonnegotiable, because it calls for payment in shirts.

a. a valid contract as long as the court can determine a reasonable price at the time for delivery

Collins offers to sell to Phillip an antique chest of drawers worth more than $2,500. Phillip agrees to buy the chest and signs a contract for the purchase. The price of the chest, however, is left out of the contract. Collins and Phillip have: a. a valid contract as long as the court can determine a reasonable price at the time for delivery. b. a valid contract only if Phillip is able to produce evidence that Collins defrauded him. c. no contract, because parties cannot leave the price term out of a valid contract under the Uniform Commercial Code (UCC). d. a valid contract only if Collins refuses to name a price.

b. cure the defect

Colton buys a used Jet Ski from Scott's Watersports. Colton takes the jet ski to a local river and discovers that it does not work. He immediately notifies Scott's, which can: a. reclaim the jet ski b. cure the defect c. cover

a. negotiable as a bearer instrument

Delany makes out an instrument payable to Captain Terrible. This instrument is: a. negotiable as a bearer instrument b. negotiable as an order instrument c. nonnegotiable d. negotiable as an order instrument

c. an implied warranty of merchantability

Delmonico buys a car from a used car dealer. The purchase order that he signs indicates that the car is sold "as is." The phrase disclaims: a. limited warranty of remediation b. full warranty c. an implied warranty of merchantability d. an implied warranty of fitness for nonspecific purpose

a. not liable, because Denise breached the good faith duty of cooperation.

Denise agrees to buy a large armchair from Diego's store. Diego offers free delivery, but Denise fails to tell him when to deliver. For three months Diego asks when he can deliver, but receives no response. Diego finally leaves the armchair on Denise's front porch. Unbeknownst to Diego, Denise is away on vacation, and a rainstorm ruins the armchair. Diego is: a. not liable, because Denise breached the good faith duty of cooperation. b. liable because the tender was not conforming. c. not liable, because Diego created an adhesion contract.

b. National Conference of Commissioners on Uniform State Laws.

Dilip has been asked to be part of the group that was responsible for a drafting uniform act relating to the sale and lease of goods, otherwise known as the a. Global Conference of Commissioners on Uniform State Laws. b. National Conference of Commissioners on Uniform State Laws. c. State Conference of Commissioners on Uniform State Laws. d. International National Conference of Commissioners on Uniform State Laws.

b. Good title to the trumpet under the entrustment rule.

Don gives his trumpet to Lucky's Music Store to repair. Later, Isabel stops by Lucky's store, sees the trumpet, and wants to buy it so her son can take music lessons. Thinking Lucky's is the owner of the trumpet, Isabel buys the trumpet for $250, a fair price for trumpets of that kind and in that condition. What kind of title does Isabel have against Don? a. Good title to the trumpet under the anticipatory repudiation rule. b. Good title to the trumpet under the entrustment rule. c. No title to the trumpet under the bad faith rule. d. No title to the trumpet under the invasion rule.

b. franchise

Dunkin Donuts licenses Nadia to use its trademark, trade name, and recipes to produce and sell donuts in Romania. Payment by Nadia will include a set-up fee, plus a small royalty on all revenues generated in Romania. This type of business arrangement is most likely a(n): a. export license b. franchise c. manufacturing plant d. international partnership

a. a franchise.

Dunkin Donuts, an American company, licenses Olivia to use its trademark, trade name, and recipes to produce and sell doughnuts in Romania. Payment will include a rather large set-up fee plus a small royalty on all revenues generated by the Romanian company. The type of business arrangement Olivia and Dunkin Donuts have is most likely a. a franchise. b. an export license. c. an international partnership. d. a manufacturing plant.

A valid contract as long as the court can determine a reasonable price.

Ed offers to sell to Nicole an antique chest of drawers worth more than $2,000. Nicole agrees to buy the chest and signs a contract for the purpose, but the price of the chest is left out of the contract. Ed and Nicole have:

d. The New York Convention.

Electronic Imports, a U.S. company enters into a contract with E Manufacturing, a company based in China. Both companies have a sign agreement with an arbitration provision, that in the event of any disputes, the matter will be arbitrated in the United States. An issue arises that causes E Manufacturing to breach its agreement with Electronic Imports, and E Manufacturing files suit in a court in China. Electronic Imports would rely on which of the following to enforce its arbitration provision in the agreement? a. Section 1 of the Sherman Act. b. The Alien Tort Claims Act. c. The North American Free Trade Agreement. d. The New York Convention.

withhold delivery

Elliot wrongfully rejects a shipment of copier paper, and the paper is shipped back to Pacific Paper. When Elliot calls Pacific Paper and demands that the paper be returned to him, Pacific Paper can:

false

For a written disclaimer to effectively eliminate the implied warranty of fitness, the word fitness must be included.

a provision in a contract saying that certain unforeseen events will excuse a party from liability for nonperformance of contractual obligations.

Force majeure clause

true

Foreign companies, such as Sony and Nissan, have established U.S. plants to avoid import duties that are imposed on Japanese products entering this country.

Alike naturally or considered alike by agreement or trade usage.

Fungible goods

d. a contract for the sofa only

Gabby, a physician assistant who is planning to move, offers to sell her sofa to her friend Trent for $750. Trent says, "I'll take it, and I would like you to throw in the coffee table along with it." Under the Uniform Commercial Code (UCC), Gabby and Trent have: a. no contract because Gabby did not accept the counteroffer. b. no contract, because of the mirror image rule. c. a contract for the sofa and coffee table. d. a contract for the sofa only.

a. withhold delivery.

Gary wrongfully rejects a shipment of copier paper, and the paper is shipped back to Pacific Paper. When Gary calls Pacific Paper and demands that the paper be returned to him, Pacific Paper can a. withhold delivery. b. reject the goods. c. replevy the goods. d. obtain specific performance.

Daphne must take delivery of the watch at Gentry's store.

Gentry owns a jewelry store and Daphne agrees to buy a watch for $3,000 that Gentry orders from Germany. They fail to specify where delivery will take place. Under the UCC:

b. of the exception to the FSIA concerning national governments engaging in strictly commercial activities.

Geo Sox, an American company, agreed to sell copper electric cables to a state-owned company in Nigeria. Geo Sox was given very specific manufacturing requirements and had to invest in new machinery to meet the requirements. Once the order was processed, the Nigerian electric company repudiated the contract, claiming immunity under the Foreign Sovereign Immunities Act (FSIA). However, Geo Sox might prevail in court because a. NAFTA prohibits application of the FSIA to African nations. b. of the exception to the FSIA concerning national governments engaging in strictly commercial activities. c. the contract included a comity provision. d. the government of Nigeria cannot defend itself without having a subsidiary of its electrical company based in the United States.

d. for as long as he retains title to the goods

Geoff often sells office supplies to a large retailer under contracts covered by the UCC. He is covered by liability insurance for as long as necessary under UCC rules for each contract. Geoff retains an insurable interest in the goods he sells: a. forever b. 6 months c. until they are sold by the retailer d. for as long as he retains title to the goods

against infringement

Gigaware employs software designers, all of whom have contracts that give Gigaware the rights to any software they create. Every time Gigaware sells a new piece of software designed by it employees, it creates a warranty:

true

Goods can be merchantable, but at the same time unfit for a particular purpose.

a. be able to bring a lawsuit under the Alien Tort Claims Act

Habib is an Arab prisoner being held in a U.S. prison. Another prisoner, Aham, attacks and seriously injures Habib. Habib's family in Saudi Arabia wants to file a lawsuit in a U.S. court against the American company that operates the prison for negligently allowing Habib to be injured. If Habib's family wishes to file a lawsuit alleging a violation of a U.S. treaty they may a. be able to bring a lawsuit under the Alien Tort Claims Act b. not be able to bring a lawsuit because foreign citizens are exempt from the jurisdiction of U.S. courts c. be able to bring a lawsuit under the laws of sharia d. not be able to bring a lawsuit because Saudi Arabia does not have a common law legal system

stop delivery

Hershel orders high-end cooktops from a manufacturer to sell in his appliance store. After these cooktops are loaded onto a truck and are being shipped to Hershel, the manufacturer discovers that he is insolvent. The manufacturer can:

a. was purchased from a disreputable manufacturer.

Holly comes into Matthew's bicycle shop to learn about the Easy Ride bicycle she saw in his newspaper ad. Matthew shows her the floor sample of the bicycle and says that it is designed to shift and brake more easily than her current model does. She decides to purchase one. Matthew gets a box from the back of the shop and sells it to her, stating that it is the bicycle Holly wants. Matthew does NOT create an express warranty with his statement that the bicycle inside the box a. was purchased from a disreputable manufacturer. b. conforms to his description of the Easy Ride. c. conforms to his promise about the bicycle's shifting and braking ability. d. conforms to the floor sample he showed to Holly.

not contract at all.

Hubert makes a contract with Van Services to purchase several vans, but no quantity of vans is specified in the contract. When they get into a dispute about the size of the order, they have:

a. demand payment of the entire amount Hung owes her if a certain event occurs.

Hung agrees to buy Trudy's ranch and they draw up a note under which he pays her in three installments on specific dates. Trudy has concerns about Hung's ability to pay on time, so she includes an acceleration clause. Such a clause would allow Trudy to: a. demand payment of the entire amount Hung owes her if a certain event occurs. b. accelerate the sale of the ranch. c. accelerate the statute of limitations in a case involving negotiable instruments.

True

Identification is significant because it gives the buyer or lessee the right to insure the goods.

True

If an additional term relates to payment, quality, quantity, price, time, and place of delivery, the CISG considers the added terms as material alterations.

exclusive

If the parties state that a remedy is _____, then it is the sole (only) remedy.

d. samples take precedence over inconsistent general descriptions.

If two warranties on a good are inconsistent, a. general descriptions displace technical specifications. b. samples displace technical specifications. c. implied warranties always displace expressed warranties. d. samples take precedence over inconsistent general descriptions.

c. are reasonably fit for the ordinary purpose for which they are sold.

Implied warranty of merchantability means that the goods: a. are of the quality demanded by the buyer in the ordinary course of business. b. are fit for a particular use specified by the buyer. c. are reasonably fit for the ordinary purpose for which they are sold.

True

In contracts that involve the sale of both goods and services, once a court decides that such a contract is primarily a goods contract, any dispute, even over the services portion, will be decided under the UCC.

Tangible (have physical existence)

In order for the rules contained in the UCC to apply to a contract for the sale of goods, the goods must be:

true

In sales law, a warranty is an assurance or guarantee by the seller about the quality and features of the goods being sold.

true

In situations in which commercial impracticability occurs, the perfect tender rule no longer applies.

false

In the absence of any specific agreements, the buyer must make payment at the time and place the contract is signed.

True

In the sale or lease of most future goods, identification occurs when the seller or lessor ships, marks, or otherwise designates the goods as those in which the contract refers.

financial statements

In what place does one typically NOT find sellers' express warranties?

true

International law can be defined as a body of law, formed as a result of international customs, treaties, and organizations, that governs relations among or between nations.

c. invalid, because its lack of portability

Jaime draws up a promissory note that uses permanent paint, payable to Nadia, on the side of a large immovable boulder. Under the UCC, the note is: a. not convenient, but legally valid b. invalid because of it impermanence c. invalid, because its lack of portability d. valid, as long as it is not for a fixed time

a. for as long as he retains title to the goods.

James routinely sells office supplies to a large retailer under contracts covered by the UCC. He is covered by liability insurance for as long as necessary under UCC rules under each contract. James retains an insurable interest in the goods he sells a. for as long as he retains title to the goods. b. for 90 days or six months. c. until they are sold by the retailer. d. forever.

d. an implied warranty of fitness for a particular purpose.

Janice is shopping for something to put on the floor of her dairy barn. She goes to Gabe's Farm Store, and Gabe tells Janice that he has just the thing—a special rubber flooring that works great in dairy barns. Based on Gabe's comments, Janice buys the floor covering and installs it. Right away, two dozen cows slip, fall, and are injured on the slippery rubber. Janice sues Gabe, contending that Gabe breached a. a warranty of title. b. an implied warranty of merchantability. c. a void warranty. d. an implied warranty of fitness for a particular purpose.

c. implied warranty of fitness for a particular purpose

Joanie has a dairy farm. She goes to Al's Farm Store and Al tells her that he has special rubber flooring that works great in dairy barns. Based on Al's comments, Joanie buys the rubber floor covering and installs it. Almost immediately, ten cows slip, fall, and are injured on the slippery rubber. Joanie sues Al contending that he breached a(n): a. warranty of title b. void warranty c. implied warranty of fitness for a particular purpose d. implied warranty of merchantability

c. merchantability.

Joey sells a clock from his store through an online auction website. He has never met the buyer, Rod, and had no communication with him before the sale agreement. When he sends the clock, he does not disclaim any warranties. The sale most likely automatically carries with it the implied warranty of: a. fitness for a particular purpose. b. inspection. c. merchantability. d. opinion.

b. file a lawsuit to recover the purchase price.

Kareem contracts to buy 10,000 optical discs from Larry, who ships them to Kareem, and they are exactly as stipulated in the contract. Kareem accepts them, but fails to pay. Larry can: a. cure the tender. b. file a lawsuit to recover the purchase price. c. cover the sale. d. reject the goods.

b. not liable, because Kate breached the good faith duty of cooperation

Kate agrees to buy a sofa from Juan's store. Juan offers free delivery as part of the purchase price, but Kate fails to tell him when to deliver the sofa. After three months of asking when he could deliver, and getting no response, Juan finally leaves the sofa on Kate's front porch on a weekday morning. Unbeknownst to Juan, Kate is away on vacation, and a rainstorm ruins the sofa. Juan is a. liable, because the tender was nonconforming. b. not liable, because Kate breached the good faith duty of cooperation. c. not liable, because Kate created an adhesion contract. d. liable, because he had a duty of assurance.

c. the repudiation is retracted

Kelly, a farmer, tells Farm Fresh Onions, Inc. that he will not be able to deliver the amount of onions agreed to under the contract. If, before the time for performance has occurred, Farm Fresh Onions has not pursued an alternative source for onions and Kelly contacts Farm Fresh Onions and tells them that he can now perform, a. Kelly is still in breach of contract. b. Farm Fresh Onions can still sue for damages. c. the repudiation is retracted. d. Farm Fresh Onions does not have to accept his retraction.

c. fungible goods.

Kevin signs a contract to purchase 10,000 bushels of grain from Gene's grain elevator that has a 100,000 bushel capacity. Kevin's bushels are classified as a. goods that are part of a larger mass. b. existing goods. c. fungible goods. d. future goods.

c. of the exception to the FSIA concerning national governments engaging in strictly commercial activities

Landers, Inc., an American company, agrees to sell copper electric cables to a state-owned company in Ecuador. Landers was given specific manufacturing requirements and had to invest in new machinery to meet them. Once the order was processed, the Ecuadorian electric company repudiated the contract, claiming immunity under the Foreign Sovereign Immunities Act (FSIA). Nonetheless, Landers might prevail in court because: a. the government of Ecuador cannot defend itself without having a subsidiary of its electric company based in the United States. b. the contract included a comity provision. c. of the exception to the FSIA concerning national governments engaging in strictly commercial activities.

b. the bank can change the $1,000 to Laura's account.

Laura postdates a check to Andrew for $1,000 and fails to tell her bank to wait until the date to charge her account. If Andrew presents the check to the bank a. the bank cannot charge the $1,000 to Laura's account. b. the bank can charge the $1,000 to Laura's account. c. Andrew will be liable for any overdraft charges for presenting the postdated check early. d. Laura will be liable for any overdraft charges if Andrew presents the postdated check early.

One who acquires the right to the possession and use of goods under a lease.

Lessee

One who transfers the right to the possession and use of goods under a lease.

Lessor

d. "I hope to pay on June 30th"

Margo does not have cash to purchase Abdul's used tablet device for his asking price of $100. Because she ran out of checks, she writes on a piece of paper "I owe Abdul $100 for a used tablet device that I am buying today, June 29th." In order to make Margo's IOU a negotiable instrument, she may add any of the following phrases to the note EXCEPT: a. "to be paid on demand" b. "I promise to pay" c. "to be paid to the order of Abdul" d. "I hope to pay on June 30th"

b. "I hope to pay on June 30."

Marie wants to purchase a pool table from her friend Gilbert. She does not have cash, and when she attempts to write him a check, she realizes she has run out. She finds a piece of paper and writes "I owe Gilbert $900 for the pool table I am buying today, June 29." In order to make Marie's I.O.U. a negotiable instrument, she may add any of the following phrases to the note EXCEPT: a. "I promise to pay." b. "I hope to pay on June 30." c. "To be paid to the order of Gilbert." d. "To be paid on demand."

d. are delivered to the carrier.

Marius buys five cars from Justin that he plans to sell on his used car lot. He and Justin agree to a shipment contract. If anything happens to damage the cars, Justin is liable until the cars a. are identified. b. reach the buyer. c. are created. d. are delivered to the carrier.

a. sue to recover any losses, if he notified the seller of the defects.

Mason orders a load of T-shirts imprinted with the names of bands he is promoting. He plans to sell the shirts at an outdoor rock concert. The shirts arrive on schedule the day before the concert. Some of the printing on the shirts is imperfect, and some of the words are misspelled. Mason decides to keep all of the shirts, even the bad ones. He can a. sue to recover any losses, if he notified the seller of the defects. b. seek no remedy; his complete acceptance is final. c. sue the seller to recover the full contract price since the goods were otherwise useless. d. sue based on the unconscionability of the contract given the inability to correct the problem.

a. against infringement

Megasoft employs hundreds of software designers, all of whom have contracts with Megasoft that give it the rights to any software they create. Every time Megasoft sells a new piece of software designed by its employees, it creates a warranty a. against infringement. b. of basis. c. against subrogation. d. disclaiming title.

-A person who is engaged in the purchase and sale of goods. -Under UCC, person who deal sin goods of the kind involved in the sales contract.

Merchant

true

Merchants are held to a higher standard of performance or duty than are nonmerchants.

c. direct exporting

Microlex, Inc., a U.S. corporation, signs a sales contract with Freres, S.A., a French corporation, in which Microlex agrees to sell Freres $100,000 worth of Microlex products. This is an example of: a. manufacturing abroad b. technology licensing c. direct exporting d. franchising

true

Nearly any symbol executed or adopted by a person with the intent to authenticate a written or electronic document can be a signature under the UCC.

Finance lease.

Nello wants to purchase a large tent for his catering business. He convinces the owner of Ajax Supplies, an outdoor equipment store, to buy the tent from the tent's manufacturer and then lease it to him. They have created a:

d. the goods are delivered by Bryce to a common carrier.

Noelle, a buyer in Portland, and Bryce, a seller in New York, enter into a contract for the sale of goods and the contract states FOB New York. The risk of loss passes when a. the contract is entered into. b. the goods are shipped by Bryce. c. the goods are received by Noelle. d. the goods are delivered by Bryce to a common carrier.

b. judges in civil systems often actively question witnesses.

One of the basic difference between a common law and a civil law legal system is that: a. judges in civil systems do not allow witnesses to speak during trials. b. judges in civil systems often actively question witnesses. c. judges in civil systems are elected by the people.

b. Alien Tort Claims Act

Othman is an Arab prisoner held in a U.S. prison. Another prisoner, Habib, attacks and seriously injures Othman. Othman's family in Saudi Arabia files a lawsuit against the U.S. corporation operating the prison. Othman's family may file this lawsuit that alleges a violation of a U.S. treaty and that treaty is the: a. UCC b. Alien Tort Claims Act c. Convention on Arbitral Awards d. Laws of Shaira

False

Output and requirements contracts are basically the same thing.

c. at the moment the goods covered by the contract are identified.

Owen buys a light fixture from an online merchant under a contract covered by the UCC. He first receives an insurable interest in the lamp: a. at the moment the contract was formed. b. at the moment the seller tenders the goods for delivery. c. at the moment the goods covered by the contract are identified. d. as soon as he takes possession of the goods.

A test courts use to determine whether a contract is primarily for the sale of goods or services.

Predominant-factor test

False

Prior to the creation of the Uniform Commercial Code, title—the right to ownership—was the irrelevant.

a. an express warranty against all defects, and an implied warranty that the refrigerator will be fit for normal use.

Refrigerators R Us sells a brand new refrigerator to Connie with a warranty that states: "This refrigerator is warranted to be free from defects for 36 months." This statement creates a. an express warranty against all defects, and an implied warranty that the refrigerator will be fit for normal use. b. an implied warranty that the refrigerator will be fit for normal use only. c. an express warranty against all defects only. d. neither an express warranty or implied warranty.

false

Revocation of acceptance is effective under all circumstances.

d. not a negotiable instrument

Samantha writes out a check "Payable to the order of XXXX Fine Corporation". No such corporation exists. Therefore, the instrument is: a. a bearer instrument b. an order instrument c. a bearer or order instrument d. not a negotiable instrument

b. the bank on which the check is drawn, because it must pay the check

Sergio gets a haircut from Amelia and writes a check made out to her. In this transaction, the drawee is: a. Sergio because he drew up the check to be charged to his account. b. the bank on which the check is drawn, because it must pay the check. c. Amelia, because the check is payable to her. d. no one in this situation.

a. the bank on which the check is drawn, because it must pay the check.

Sergio gets a haircut from Amelia and writes a check to pay for it. In this transaction, the drawee is a. the bank on which the check is drawn, because it must pay the check. b. not a party to this transaction. c. Amelia, because the check is payable to her once it is presented at a bank. d. Sergio, because he drew up the check to be charged to his account.

d. good title to the tablet under the entrustment rule.

Shalinda leaves her tablet device to be repaired at Hank's Repair Shop. Isabel is in the store the next day and wants to buy the now-repaired tablet device, which Hank sells to her for $100. What kind of title does Isabel have against Shalinda? a. no title to the tablet under the invasion rule. b. no title to the tablet under the bad faith rule. c. good title to the tablet under the anticipatory repudiation rule. d. good title to the tablet under the entrustment rule.

b. accepted the rose bushes; she had a reasonable time to inspect the plants and has failed to reject them

Shara asks George to deliver six rose bushes from his nursery to her house. George brings the bushes, and Shara places them around her property. For several weeks, she admires the bushes, but she does not pay for them. Shara has a. exceeded the statute of limitations. b. accepted the rose bushes; she had a reasonable time to inspect the plants and has failed to reject them. c. made a full rejection of the rose bushes, because she hasn't paid. d. made a partial rejection of the rose bushes, because she hasn't paid.

c. Maurice and Sonja are excused from performance.

Sonja visits Maurice's Rare Plants store, selects five bonsai trees, and agrees to buy them. While Maurice is in the process of packing the trees for delivery, lightening strikes the greenhouse and destroys them. With respect to the contract, a. Maurice must replace the lost bonsai trees that Sonja agreed to purchase. b. Maurice and Sonja must share the loss. c. Maurice and Sonja are excused from performance.

a. Jesse presents the check to Stephanie's bank

Stephanie needs to have her car's radiator replaced so she takes it to Jesse, who makes the necessary repairs. Stephanie writes him a check. In this transaction, presentment occurs when: a. Jesse presents the check to Stephanie's bank. b. Stephanie presents the check to Jesse. c. Stephanie's bank presents her with the cancelled check. d. Stephanie writes the check.

b. good title and merchantability

Tanner sells a clock from his store through eBay. He has never met the buyer, Rojillo, and had no communication with him prior to the sales agreement. When Tanner sends the clock, he does not disclaim any warranties. The sale most likely automatically carries with it warranties of: a. good title and fitness for a particular purpose b. good title and merchantability c. merchantability and fitness for a particular purpose.

false

Tender of delivery occurs at any time.

c. beneficiary.

The First National Bank of Guatemala issues a letter of credit in which the bank agrees to pay Esteban, a seller of jade, upon Esteban's delivery of a certain amount of jade to a particular location. Esteban is the a. issuer. b. adviser. c. beneficiary. d. account party.

beneficiary

The First National Bank of Panama issues a letter of credit in which the bank agrees to pay Eduardo, a seller of jade, upon Eduardo's delivery of a certain amount of jade to a particular location. Eduardo is the:

true

The UCC provides that when cooperation is not forthcoming, the other party can suspend performance without liability and hold the uncooperative party in breach or proceed to perform the contract in any reasonable manner.

true

The UCC warranty rules remain the primary codification of such rules for commercial transactions.

a. accept and pay for conforming goods in accordance with the contract.

The basic obligation of a buyer in performing a sales or lease contract is to: a. accept and pay for conforming goods in accordance with the contract. b. negotiate terms of payment for conforming goods. c. negotiate the quality of the goods in a contract.

true

The buyer must reject the goods within a reasonable amount of time after delivery and must timely notify the seller.

False

The common law of contracts and the Uniform Commercial Code are exactly the same.

b. a time draft is payable at a definite future time, whereas a sight draft is payable when it is presented to the drawee

The difference between a time draft and a sight draft is that: a. a time draft is payable when presented to the drawee for payment, whereas a sight draft is payable at a definite future time. b. a time draft is payable at a definite future time, whereas a sight draft is payable when it is presented to the drawee. c. there is no difference.

b. arises automatically in most sales contracts.

The general rule regarding the warranty of title in most sales contracts is that the warranty: a. arises only after the buyer has inspected the goods. b. arises automatically in most sales contracts. c. does not apply to sales contracts, only to lease contracts.

c. not prevail because of the act of state doctrine.

The government of Bolivia passes a law stating that no U.S. dollars are allowed to enter the country. Americans traveling to Bolivia therefore may not bring dollars with them, nor may anyone else bring dollars into the country. All dollars have to be exchanged for the Bolivian domestic currency at any border crossing, airport, or train station. Laura, a U.S. citizen, files a lawsuit against Bolivia in a U.S. court challenging the legality of this law. Laura will most likely a. prevail because of the doctrine of comity. b. not prevail because Laura has sovereign immunity. c. not prevail because of the act of state doctrine. d. prevail because the law clearly violates the U.S. Constitution.

c. the difference between the contract price and the market price.

The measure of damages under the Convention on Contracts for the International Sale of Goods (CISG) normally is: a. the cost of specific determination. b. lost profits, plus ten percent. c. the difference between the contract price and the market price.

b. deliver or hold at the buyer's disposal goods that conform to the contract's terms in every respect.

The perfect tender rule of the UCC generally requires that the seller: a. reclaim the goods at any time before payment. b. deliver or hold at the buyer's disposal goods that conform to the contract's terms in every respect. c. be a good faith dealer when negotiating a sale of goods and performing delivery.

true

The serving of food or drink is treated as a sale of goods subject to the implied warranty of merchantability.

true

The term fixed amount means the same thing as a sum certain and is a requirement for negotiability.

c. an implied warranty of merchantability.

Tim buys a car from a used car dealer. The purchase order he signs states that the car is sold "as is." That phrase disclaims a. a full warranty. b. a limited warranty of remediation. c. an implied warranty of merchantability. d. an implied warranty of fitness for a nonspecified purpose.

false

To create an express warranty, a seller must formally use the words warranty or guarantee.

d. when the buyer is unable to cover

Under the UCC the right to replevy goods is usually available to a buyer: a. at any time b. when the buyer is unable to cure c. never d. when the buyer is unable to cover

accept all, part, or none of the goods

Under the UCC's perfect tender rule, when a seller delivers nonconforming goods, a buyer must:

c. a receipt of goods signed by a carrier and a contract for transportation of the goods.

Under the UCC, a bill of lading is: a. the same thing as a shipment contract when perishable goods are shipped. b. a payment by the buyer of goods to a seller. c. a receipt of goods signed by a carrier and a contract for transportation of the goods.

Valid if the parties intended to form a contract and there is a good basis for a court to grant a remedy.

Under the UCC, a contract that contains open terms will be:

a. When, since the time of repudiation, the other party has materially changed position.

Under what circumstances can there be NO retraction of anticipatory repudiation? a. When, since the time of repudiation, the other party has materially changed position. b. When the other party has sent an e-mail indicating that any delay is acceptable. c. When the other party has not reacted.

c. are cumulative

Unlike remedies under the common law, remedies under the UCC: a. must be elected b. are decisive c. are cumulative d. are reactionary

c. not prevail because of the act of state doctrine

Venezuela passes a law stating that no dollars are allowed to enter the country, such that Americans traveling to Venezuela have to exchange their dollars for Venezuelan's domestic currency at any border crossing. Natalie, a U.S. citizen, files a lawsuit against Venezuela in a U.S. court challenging the legality of this law. Natalie will most likely: a. prevail because the law clearly violates the US Constitution b. prevail because of the doctrine of comity c. not prevail because of the act of state doctrine d. not prevail because Natalie has sovereign immunity

in existence

Vernon designs prototypes of products and sells the prototypes to Spencer, who manufacturers and markets the products. When Vernon is in need of cash, he offers to sell Spencer the designs for his next three inventions in exchange for an immediate lump-sum payment. For Spencer to acquire title to Vernon's next three prototypes, they must be:

a. are delivered to the carrier

Vladimir buys three cars from Evan, who plans to resell them on his used-car lot. Vladimir and Evan agree to a shipment contract. If anything happens to damage the cars, Evan is liable until the cars: a. are delivered to the carrier b. are identified c. are created d. reach the buyer

a. may have antidumping duties imposed on its imported goods.

Wai-tung, a Chinese firm, manufactures automobiles. In order to get a foothold in the American market, Wai-tung sells its cars for several thousand dollars below what it charges in China. Wai-tung a. may have antidumping duties imposed on its imported goods. b. is subject to the quotas imposed by the United State on goods sold below market value. c. is subject to American antitrust laws. d. may continue to sell its cars at the discounted price for six months, after which a tariff may be imposed.

a. The offer must state the date for all future shipments.

What is NOT one of the requirements for a merchant's firm offer? a. The offer must state the date for all future shipments. b. The offer must be signed. c. The offer must be written or electronically recorded, such as in an e-mail.

a. $270.00

When Duncan writes a check to purchase jewelry, he writes $250.00 in the small box on the right-hand side of the check. But then in clear handwriting he writes out "Two hundred seventy dollars and no/100." Duncan is liable for ____ multilateral and bilateral treaties. a. $270.00 b. $250.00 c. $20.00 d. nothing

False

When Lisa offers to sell all of the tamales that she makes to Xavier, they have created a requirements contract.

notify the seller of the litigation within a reasonable time

When a buyer is sued by a third party holding copyright, trademark, or patent rights in the goods, the title warranty of no infringements has been breached. What must the buyer do?

a. Make the parties go through with the contract no matter what.

When a court determines that a contract was unconscionable at the time that it was made, the UCC allows all of the following EXCEPT one, which is: a. Make the parties go through with the contract no matter what. b. Limit the application of the unconscionable term to avoid an unconscionable result. c. Refuse to enforce the contract. d. Enforce the remainder of the contract without the unconscionable part.

True

When a title document is required, title passes to the buyer when and where the document is delivered.

false

When an international sales contract does not have an arbitration clause, but does have a forum-selection clause and a choice-of-law clause, the law suit will always be heard by a court in the country where the plaintiff resides.

They are held to less demanding standards than merchants.

When merchants are involved in commercial sales transactions, they are held to certain standards because of their presumed commercial expertise. When nonmerchant buyers or sellers are involved:

true

When the buyer is a consumer, any limitation of consequential damages for personal injuries resulting from consumer goods is presumed to be unconscionable.

c. the difference between the value of the goods as accepted and their value if they had been delivered as warranted.

When the goods delivered are not as promised, the measure of damages equals: a. the difference between the value of the goods as accepted and their value in the future. b. the difference between the value of the goods as advertised and the value of the goods available from a competitor. c. the difference between the value of the goods as accepted and their value if they had been delivered as warranted.

false

When the seller is a merchant, risk of loss to goods held by the seller passes to the buyer when the buyer signs the contract.

true

With an installment contract, a buyer or lessee can reject an installment only if the nonconformity substantially impairs the value of the installment and cannot be cured.

true

Without evidence to the contrary, when both parties to a sales contract have knowledge of a well-recognized trade custom, the courts will infer that both parties intended for that custom to apply to their contract.

a. nothing, because he is just puffing.

You go to buy a chainsaw and the salesperson says "This chainsaw could probably cut down a 2,000-year-old redwood in five minutes." The salesperson has created: a. nothing, because he is just puffing. b. an implied warranty. c. an express warranty.

a contract for the sofa only

Zeppo offers to sell his sofa to Brian for $385. Brian says, "I'll take it, and I would like you to throw in the coffee table along with it." Under the Uniform Commercial Code, Zeppo and Brian have: