Unit 4: Contract Sales and Leases ( 1 )

Common Law

The primary source for contract law is a. Common law b. Expectations c. Person Interests d. Social values

Absolute

Trucking LLC enters into a contract to deliver a certain quantity of potatoes to United Food's refrigerated warehouse in exchange for a specified payment. Trucking delivers the potatoes to the location. United's duty to pay is a. Discharged b. Absolute c. Qualified d. Conditioned

Promptly notify ABC of the intent to cure

ABC Hardware Store orders one hundred power hand-drills from Drilling Tools Inc. When the hand-drills are delivered, they are all missing pieces. ABC rejects the shipment. To exercise a right to cure, Drilling must a. Promptly notice ABC of the intent to cure b. Pay a cure fee c. Enter into a new contract with ABC d. Pick up the nonconforming tools before the end of the business day

Recover consequential damages

ABC Hardware orders a shipment of hammers and saws from Tools R Us for a special DIY event that they are planning. ABC agrees to pay for the tools on delivery. Tools R Us accepts the order but fails to deliver. ABC Hardware then purchases the hammers and saws from Enzo's Tools, but the tools do not arrive in time for the event. ABC can: a. Recover consequential damages b. Obtain specific performance c. Obtain the hammers and saw in event of insolvency d. Do nothing

Obtain specific performance

Art and Antiquities, LLC orders 5 pieces of rare imperial jade from Art Brokers, Inc. In order to meet the terms of the sale, Art and Antiquities pays in full prior to shipment. When the shipment does not arrive in the expected time, Art and Antiquities contacts Art Brokers who responds that they have decided not to sell and offers to return the payment. Art and Antiquities can: a. Reject the next shipment from Art Brokers b. Recover the damages equal to the difference between the agreed price and the market prie c. Replevy the goods d. Obtain specific performance

Still liable on the bid

At an auction, Ben bids on a 1957 Chevy coupe, believing that it is worth more than the price asked. When the car proves to need more repairs than Ben estimated, and thus is worth less as is, Ben is a. Still liable on the bid b. Not liable on the bid because the need for repair is not a material fact c. Not liable on the bid because he underestimated the cost of repairs d. Not liable on the bid because the auctioneer misrepresented the value

If it is signed by Bean

Bean Processor Inc. agrees to ship a certain quantity of coffee beans to Coffee Café LLC. Bean sends to Coffee an e-mail indicating that the parties intended to form a contract. Against Bean, as a contract, the e-mail will be sufficient a. If it is signed by Bean b. Under no circumstances c. If it is signed by Coffee d. If Coffee responds with an acknowledgement of the deal

$10,000 from Bee

Bee is an employee of Credit Agency Inc. On the termination of Bee's position, Credit pays Bee $10,000 to agree not to disclose the employer's confidential information. Later, Bee sells the information to Debt Records LLC for $100,000. In a suit for breach, Credit is most likely to recover a. $10,000 from Bee b. All future profits from Debt c. $110,000 from Bee d. $100,000 from Debt

Can rescind the deal based on fraudulent misrepresentation

Beryl enters into a contract with Clay for a guided tour of Deep Canyon. Clay represents that he is an experienced, knowledgeable guide, when in reality he has never been in the canyon. Most likely, Beryl a. Could exert duress to obtain a new guide b. Must comply with the contract because the representation is an opinion c. Can rescind the deal based on fraudulent misrepresentation d. Might recover damages for the mistake

The implied warranty of merchantability

Bike Shop sells a trail bike to Ciena. When Ciena rides the bike, the frame breaks apart. The cause is something that Bike Shop did not know about and could not have discovered. This is a breach of a. Puffery b. A warranty of title c. The implied warranty of merchantability d. An express warranty

Irrevocable for the stated period

Bon, an agent for City Motors Inc., e-mails Dale on May 1 that the dealer will sell to her a 2018 Ford pick-up truck for $25,000 between May 1 and July 1. Bon's offer to Dale is a. Irrevocable for the stated period b. Revocable on the payment of consideration to Dale c. Irrevocable until Dale responds d. Revocable at any time

The market price at the place at which Concrete delivered the goods plus incidental damages

Builder Inc. and Concrete Supply Company enter into a contract for a sale of cement. Concrete delivers, but Builder does not pay. Concrete can recover as damages a. The market price at the place at which Concrete delivered the goods plus incidental damages b. The purchase price plus incidental damages c. Any profit lost minus an loss avoided d. Whatever amount Concrete wishes to claim

Await performance, sue Chair, or suspend its own performance

Chair Company contracts to deliver a dozen suites of dining room tables and chairs to Furniture Store on May 1. On April 15, Chair tells Furniture that delivery will be delayed until June 1. Furniture may a. Only await Chair's performance for a commercially reasonable time b. Only sue Chair for breach of contract c. Only suspend its own performance d. Await performance, sue Chair, or suspend its own performance

Discharged

Dom enters into a contract to buy Ezra's office building for a certain price subject to an appraiser's evaluation of the structure's condition. If the appraiser deems the condition to be substandard, the parties' obligations will be a. Performed b. Altered c. Discharged d. Breached

The terms of the original offer

Dona offers to sell her used sofa, chair, coffee table, end table, and lamp to Etta for $700. Etta responds that she will pay that price if Dona's TV set is included. Neither party is a merchant. Their contract is formed according to a. The terms of the original offer b. Whatever is reasonable c. Under no circumstances d. The new terms of the acceptance

Place the goods in the hands of a carrier

Elegant Carpet Inc. agrees to sell a certain quantity of carpeting to Fabulous Floor stores under a shipment contract. Elegant must a. Deliver the goods to a particular destination b. Allow the buyer to reject the goods for any reason c. Place the good in the hands of a carrier d. Inspect the goods before shipping it

A sale of goods

Embers Corporation orders 12 fire extinguishers from Firefighting Inc., which delivers the equipment. This is most likely a. A contract for services b. A sale of goods c. A gift d. A lease of goods

Specific Performance

Erma enters into a contract to buy a tract of riverfront property from Forest Acres to build and sell a residential development. Forest Acres fails to close the sale. Erma's remedy is most likely a. Nothing - Forest Acres still owns the land b. Specific performance c. The difference between the contract and market prices of the land d. The amount that Erma invested in the project to the date of the closing

$500

Fiesta LLC contracts to buy 1,000 balloons from Gas Bags Inc. for $1 per item. When the market price decreases to 50 cents per balloon, Fiesta refuses to go through with the deal. Gas Bags can recover a. $1,500 b. $1,000 c. $0 d. $500

Whatever is reasonable

Grinders Mill agrees to sell to Harvest Company a certain quantity of refined grains. Some of the other terms in the deal are left open. In the case of a dispute, a court will generally presume a. Whatever favors the plaintiff b. Whatever is reasonable c. Nothing d. Whatever favors the non-breaching party

Good and valid

Holiday Corporation sells Idyll brand campers and trailers. Under most circumstances, Holiday will be presumed to have warranted that its title to goods is a. Good and valid b. Only such as the seller has acquired in the goods c. A warranty of title is not presumed d. The same as every other merchant who deals in goods of the kind

Can no longer be brought

Jamal and Keri enter into a contract for Jamal to renovate Keri's house by a certain date. Jamal never performs. After the applicable limitations period has passed, Keri decides to bring a suit against Jamal for breach. This suit a. Can be brought up within 20 years, based on state law b. Can no longer be brought c. Must be filed between four and five years after Keri decides to sue d. Can be filed within four years of notice to Jamal that Keri decided to sue

An express warranty

Jess, a salesperson for Kitchens Inc., shows Lane, a buyer for Metro diner, display items in Kitchens' showroom, stating that any purchased equipment will match the display. This is a. An express warranty b. A statement of opinion c. An implied warranty d. Puffery

The sale to Steve

Jo owns a condominium that she leases to Kia. Jo employs Maria to manage the condominium. Jo gives her daughter Liu $450 on her sixteenth birthday. Jo sells her car to her neighbor Steve for $1,500. Article 2 of the UCC covers a. The sale to Steve b. The gift to Liu c. The employment of Maria d. The lease to Kia

A unilateral contract

Juan offers to pay Sari to deliver certain documents within thirty minutes. Sari can accept the offer only by completing the task within the deadline. If she does, Juan and Sar will have a. An unenforceable contract b. A void contract c. A bilateral contract d. A unilateral contract

Withhold delivery

Keisha contracts to buy appliances from Crazy Carlos Appliances. Keisha agrees to pay half within 5 days of the order and the remainder upon delivery. Keisha fails to pay the first 50%. Carlos can: a. Obtain specific performance b. Claim the difference between market price and purchase price c. Withhold delivery d. Recover as damages the full purchase price plus incidental damages

$1,000

Len contracts to work for Media Corporation during May for $4,500. On April 30, Media cancels the contract. Len then accepts a similar job with New Ads Inc., which pays $3,500. Len files a suit against Media. As compensatory damages, Len can recover a. $0 b. $1,000 c. $3,500 d. $4,500

Nona promised to pay for the watch

Macy offers to sell his fitness watch for $50 to Nona. Nona promises to pay Macy the price. Later, they exchange the watch for the funds. A contract was created when a. Nona promised to pay for the watch b. Nona paid for the watch c. Macy offered to sell the watch d. Macy delivered the watch

An Express Contract

Marketing Inc. offers to create a campaign to increase N'Ice Cream Inc.'s online business. N'Ice agrees to pay for the service. These parties have a. An express contract b. A formal contract c. No contract d. An implied contract

Exchange the horse for the money

Megan contracts to sell Nonny her horse for $4,000. This contract will be fully discharged when Megan and Nonny a. Exchange the horse for the money b. Agree that the deal is fair c. Sign a receipt d. Execute a bill of sale

A sale

Mining Corporation purchases the business assets of Open Pit Inc., including its equipment and supplies, for an agreed-to-price, payable in installments. Under the UCC, this transaction is a. A sale b. A sublease c. A lease d. A contract for services

Any reasonable hour

Nature's Eggs Inc. agrees to supply Omelet Express with five hundred eggs. Nature's Eggs can reasonably ask Omelet Express to pick up the eggs at a. No time - as a seller, Nature's Eggs must deliver the goods b. Any hour c. Any reasonable hour d. No specific time - only a buyer can set the time

Reject the shipment

Office Express orders 100 smartphones from Electronic Supply for $500 per phone. Electronic Supply sends 100 flip phones instead. Office Express has the right to: a. Reject the shipment b. Replevy the goods c. Stop the delivery of the good in transit d. Revoke acceptance

Not rescind the contract

Open Range agrees to sell Pinewood Ranch a remote parcel of land for $15,000. Both parties believe the land to be worthless, but beneath it is shale rock containing oil. A court would a. Not rescind the contract b. Rescind the contract on the basis of a mistake of opinion c. Rescind the contract on the basis of a mistake of quality d. Rescind the contract on the basis of a mistake of value

The contract price and the market price

Real Stones Inc. and Sparkling Jewelry stores enter into a contract for a sale of gemstones. The seller fails to deliver. Sparkling can recover as damages the difference between a. The current prices in the contracting parties' places of business b. Any loss avoided and any profit gained c. The contract price and the market price d. The actual price and the hoped-for price

The loss of profit from the delayed opening

Renew Inc. contracts to resurface the pools at Swim Park by June 1. Renew knows that if performance is not timely, Swim Park will have to delay its seasonal opening. Renew finishes the job June 15. In a suit for breach, Swim Park can recover a. The difference between the contract and market prices for the work b. Nothing - the work is done c. The loss of profit from the delayed opening d. The cost of the new pools

Is bound to the deal at the offered price

Restaurant Food Inc. intends to sell a certain quantity of beef for $1,100. In an e-mail however, the firm's sales representative mistakenly offers to sell the beef to Steak House for $1,000. Steak's manager immediately accepts. The seller a. Can rescind the deal and recover damages for the mistake b. Is bound to the deal but can change the intended price c. Is bound to the deal at the offered price d. Can rescind the deal

A lease

Seacoast Transport Company pays Trucks & Trailers Inc. a stated price for the use of seven tractor-trailer rigs for a year. Under the UCC, this is a. A sublease b. A lease c. A sale d. A contract for services

A warranty disclaimer

Sofia purchases a new vehicle from a neighborhood car dealer. The vehicle warranty specifically states that there is a bumper to bumper warranty for the first 30,000 and an engine and drivetrain warranty for 100,000 miles. The warranty documentation supplied with the car specifies that wear items such as brake pads, belts, wipers and bulbs and oil changes are excluded. After 25,000 miles, Sofia's car needs new brake pads. She is told that this is not covered by the warranty. This exclusion is an example of: a. A warranty disclaimer b. A breach of the warranty of title c. A breach of the implied warranty of fitness for a particular use d. A breach of the express warranty

Resell the garages and recover any damages from Truck

Steel Buildings Inc. agrees to sell four portable garages to Truck Service Center. Five days later, Truck refuses delivery and cancels the contract. Steel is entitled to a. Resell the garages and recover any damages from Truck b. Recover any damages from Truck but not resell the garages c. Resell the garages but not recover any damages from Truck d. Force Truck to accept the garages