LAW 3220, CH 11: Domestic and International Sales, Toussaint
goods
"all things which are movable at the time of identification to contract"; must be movable and tangible
seller has option
2-311 states that ___ for arrangements for shipment and 2-308 presumes delivery at seller's place of business
merchants
CISG covers only sales between ___, not the consuming public
filling the gaps
UCC instructs judges to fill parts of contract left open or unclear, i.e. price, quantity, or delivery terms
reasonableness standard
USS will look at trade usage and past business dealings of the parties in determining the outcome of unclear terms; it will also apply ____
sufficiency of writing
____ under UCC is relaxed; not every material term needs to be specified
remedies for CISG
behave in reasonable manner and give opportunity to cure breach- nachfrist notice; duty to mitigate damages
cover
buy substitute goods and recover price difference
implied warranty of fitness for a particular purpose
buyer communicates to seller, or seller "has reason to know" buyer's particular needs; buyer relies on seller's expertise, then may have warranty
cover, incidental damages, consequential damages
buyer's damages
paramount contracting v DPS industries
case on dominant feature
offeree
conflicting terms - "battle of the forms"; ___ must specifically note that acceptance is contingent on offeror accepting changed terms for the different terms to become part of the deal
seller delivers nonconforming goods and buyer accepts
deduct damages from price, sue seller for damages, sue for breach of warranty
affirmed for QVC to receive damages for breached warranty
holding in QVC, inc v MJC america, ltd
delivery terms
regarding ____, 2-309 states delivery must be within a reasonable time
language
seller may make disclaimers but ____ may need to be specific and the disclaimer must be conspicuous
specific and conspicuous
warranties may be disclaimed, but disclaimers must be ___ to type of warranty and must be ____
sales warranties
warranty of title, express warranties, merchantability, implied warranty of fitness for a particular purpose
reduces the formality
when forming a sales contract, common law governs unless UCC changes or modifies the rules; that is, if parties do not specify which law governs a contract the courts look to see if it fits under common law or under UCC; mostly, UCC ___ required
CISG
Contracts for the International Sale of Goods
parol evidence
____ is more relaxed under the UCC than at common law; says that it can't usually be used against the writing but it can explain customary trade dealings or the meaning of certain terms
merchant
a seller or buyer is a ___ when they 1) regularly deals in goods of the kind involved in the transaction, 2) by occupation presents themselves has having knowledge to transaction, 3) employs an agent or broken who holds themselves out as having the required knowledge/skill
specifically objected; materially alter
additional terms become a part of a contract unless ___ to within a reasonable time or unless additional terms ___ the contract
offers for CISG
advertisements are not offers; can fill in missing terms. Is sufficiently definite if indicates goods and expressly or implicitly fixes/makes provision for determining the quantity and price
seller's remedies
applies when buyer repudiates before receiving goods or buyer repudiates after receiving goods
buyer's remedies
applies when seller repudiates before delivery of goods, seller fails to deliver, seller delivers nonconforming goods and buyer rejects, or when seller delivers nonconforming goods and buyer accepts
goods exist and have been identified to contract
article 2 of UCC applies to sale of goods; title must pass to be a sale and one can hold title if:
buyer repudiates before receiving goods
cancel contract, ID goods and minimize losses by completing or stopping manufacture mitigation, withhold or stop delivery, resell goods in commercially reasonable manner, sue buyer for losses incurred
seller fails to deliver
cancel contract, obtain goods from another supplier (called cover: price paid for substitute goods or market price for measure of damages), sue seller
seller repudiates before delivery of goods
cancel contract, obtain goods from another supplier, sue seller
seller delivers nonconforming goods and buyer rejects
cancel contract, obtain goods from another supplier, sue seller, sell rejected goods to recover advance payments, if no advance payments, store and reship goods
orkal industries v array connector corp
case for "battle of the forms"
griffith v clear lakes trout co
case for filling the gaps; case where UCC looked at trade usage, fair market value, and past business dealings
crest ridge construction v newcourt, inc
case on "how courts fill in gaps" for UCC
QVC, inc v MJC america, ltd
case on breach of warranty
lee v R&K marine, inc
case on disclaimer for warranties
special action
conflicting terms - "battle of the forms"; if offeree's form doesn't match offeror's there is acceptance but use the offeror's terms unless ___ is taken
express warranties
created by seller's promise as to quality, safety, performance or durability of goods; may be created from sample or mode, by description of attributes, or by seller's promises or statements
dominant feature
for contracts involving mixed transactions, the sale of a good and a service (e.g. the sale of a copier and its maintenance agreement), courts generally look to see if the ___ of the contract "as a whole" is a sale of goods or of services; the relationship is governed by the law that applies to the ____
merchantability
for sales by merchants; goods must be of quality generally acceptable in trade and must be able to do what it expected
consequential damages
foreseeable damages that result from seller's breach; may be with third parties and not necessarily with seller
CISG similarities to UCC
formality, offers, acceptance, battle of the forms, duties of parties, remedies
warranty of title
good title will be transferred free of claims against it (2-312)
uniform commercial code (UCC)
governs contracts for sales of goods NOT services, real estate, or professional services; primarily state, not federal (each state adopts a version of model UCC statute)
acceptance
greater flexibility in communication of ____; "any reasonable manner" under circumstances and may be valid even if new terms are added or existing terms are changed
affirmed for R&K; writing for warranties were conspicuous
holding for lee v R&K marine, inc
affirmed for DPS; sale of dirt was predominant purpose of transaction, therefore sales transaction and UCC applies
holding for paramount contracting v DPS industries
affirmed; breach of contract by newcourt
holding in crest ridge construction v newcourt, inc
affirmed in favor of griffith; both parties had intent to make a contract and understood fair market value
holding in griffith v clear lakes trout co
reversed in favor or orkal; inclusion of forum selection clause constitutes a material alteration to initial contracts
holding in orkal industries v array connector corp
buyer repudiates after receiving goods
if buyer won't pay, sue for payment and damages; if buyer wrongfully rejects, can claim goods and remedy as above; if can't reclaim goods, sue for payment and damages
battle of the forms for CISG
if differences are material, then 2nd form is counter-offer, not contract
stolen property
if seller sells ___, title does not pass to the buyer
court
if the contract is a mix of goods and services the ____ will determine if common law or UCC applies however, in such a contract parties can agree that UCC will apply to any disputes
change the terms
if the intent that the original writing is "a complete and exclusive statement of terms", parol evidence may not be used to __; it must explain industry standards
china has accepted CISG
important country in CISG
good faith
in sales of goods, parties are bound to a standard of ____
incidential damages
includes reasonable costs of inspecting, receiving, transporting and taking care of goods
contracts excluded from UCC
insurance, employment, and service contracts, contracts involving real estate and intangible property like stocks, bank accounts, patents, and copyrights
good faith dealing
intent to contract: courts require ___; doesn't allow one party to profit from bad fortune of other party due to unexpected large changes in circumstances
output or requirements contracts
intent to contract: indefinite offer; ok to be missing major terms like price, delivery, payment terms if parties intent to be bound but usually need quantity unless ___
irrevocable
intent to contract: merchants firm offers - ____; sign in writing that offer will remain open for given period, if not state, period is "reasonable time"
relaxed
intent to contract: offer and acceptance rules ___; only need agreement between parties
business expertise
merchants are treated differently from other parties because they possess ____
acceptance for CISG
must be made within time stated or reasonable time; sent by reasonable means
formality for CISG
need not be formal, nor in writing; look at circumstances for interpretation
contract modification
need not provide new consideration, but must have "good faith dealing"; modification must usually be in writing
nachfrist notice
period of grace; notice of the problem and a chance for nonconforming party to cure before lawsuit;
price
regarding ___, if contracts are not clear, 2-305 tells court to determine a reasonable price (fair market value, past dealings, etc)
quantity
regarding ____, 2-306 recognizes requirement contracts and output contracts where quantities may not be clear
rule of law
sales covered by CISG - default ___ for commercial sale of goods by parties in countries that have adopted CISG; parties can specify to exclude application of CISG and choose another law to govern contract
failure to respond to a writing
section 2-201(2) says that if a writing in confirmation of the contract it received, it satisfies the writing requirements UNLES "written notice of objection" is within 10 days after the writing was received
duties of parties for CISG
seller must deliver goods with good title; buyer must notify seller of defects within a reasonable time
statute of frauds
the basic rule is that sale of goods for $500 or more is not enforceable unless in writing and signed by the party against whom enforcement is sought
simplify, clarify, and modernize
the purpose of UCC is to ____ the law governing commercial contracts
seller
title can pass when parties see fit but if not specified, article 2 says title passes when the ___ completes all obligations regarding delivery of goods and when ___ delivers title documents