BLAW Chapter 13 Quiz

Goods associated with real estate never fall within the scope of UCC Article 2. (T/F)

False

The UCC requires that the mirror image rule be followed for all acceptances. (True/False)

False

Over the course of a year, Retail Marketers, Inc., sells goods from its inventory and one of its warehouses. In exchange, Retail receives checks and other items that substitute for cash, which Retail uses to repay a loan from Savings Bank. Article 2 of the UCC governs a. The checks. b. The payment of the loan. c. The sale of the buildings. d. The sale of the goods.

The Sale of the goods (D)

The UCC views the entire "commercial transaction for the sale of and payment for goods" as a single legal occurrence. (True/False)

True

The United Nations Convention on Contracts for the International Sale of Goods (CISG) is the uniform international sales law of countries that account for more than two-thirds of all global trade. (T/F)

True

Under the UCC, an offeror must be notified within a reasonable time that the offeree has accepted. (True/False)

True

Under the UCC, good faith means honesty in fact and the observance of reasonable commercial standards of fair dealing in the trade (True/False)

True

Under the UCC, parties to sales and lease contracts are free to establish whatever terms they wish. (True/False)

True

Medico Inc. enters into a contract to sell medical supplies to New Hospital Corporation, which sells some of the items to Physicians Clinic, which later sells them to Oscar, a patient and consumer. Article 2 of the UCC applies to the sales transactions between A. All buyers and sellers. B. Medico and New Hospital only. C. New Hospital and Physicians Clinic only. D. Physicians Clinic and Oscar only.

All buyers and sellers (A)

Rally Corporation enters into a contract to sell ski gear to Sno-Sports Inc., which sells a pair of the skis to Tyra, a consumer, who later sells them to Upton, another consumer. Article 2 of the UCC applies to the sales transactions between A. All of the buyers and sellers. B. Rally and SnoSportz only. C. SnoSportz and Tyra only. D. Tyra and Uli only.

All of the buyers and sellers. (A)

Nature's Products, Inc., sends its standard order form to Interbusiness Distribution Corporation (IDC) to evidence a sale of packing materials. IDC responds with its own standard purchase order form. Additional terms in the purchase order automatically become part of the contract unless A. The terms materially alter the original contract. B. The original offer expressly required acceptance of its terms. C. The offeror objects to the new terms within a reasonable time. D. Any of the choices.

Any of the choices (D)

Omni Metals Company and Piecework Fabrication, Inc., enter into a contract under which Omni agrees to deliver a certain quantity of sheet metal to Piecework each month. The contract does not include a price term. In a suit between the parties over the price, a court will A. Determine a reasonable price. B. Impose the lowest market price. C. Impose the highest market price. D. Return the parties to the positions they held before the contract.

Determine a reasonable price (A)

Bram buys a bulldozer from Construction Equipment Corporation, which he leases to Earth Movers, Inc. In this situation, the lessee is a. Bram. b. Construction Equipment Corporation. c. Earth Movers. Inc. d. None of the choices.

Earth Movers. Inc (C)

Raul agrees to ship to Ben one hundred ceiling fans for $5,000. Raul initials his notes of the deal, which include the terms, and files the notes in his office. Ben initials his own notes of the deal, which include the terms, and files the notes in his office. Raul fails to ship the fans. Against Raul, as a contract, the deal is A. Enforceable because under the UCC a contract doesn't need to be in writing B. Enforceable because Raul's initialed notes are a sufficient writing C. Enforceable because Ben's initialed notes are a sufficient writing D. Not enforceable

Enforceable, because Raul's initialed notes are a sufficient writing (B)

A firm offer by a merchant may be oral. (True/False)

False

A lessor is a party who acquires a right to the possession and use of goods under a lease. (T/F)

False

A merchant's firm offer is revocable at any time before acceptance. (True/False)

False

Great Harvest Farms offers to sell Hearty Bakeries, Inc., fifty bushels of wheat. Hearty's representative Ilene responds, "We agree to buy fifty bushels only if the wheat is Grade A quality." Between Great Harvest and Hearty Bakeries A. a contract is formed. B. a contract is formed only if GroAgri can deliver the wheat fast. C. Ilene's statement is not an acceptance. D. Ilene's statement is an acceptance.

Ilene's statement is not an acceptance (C)

Jacob offers to sell Bill a valuable collection of baseball cards. In order for the transaction between Jacob and Bill to be considered a sale under the UCC, Bill a. Must pay for the cards in cash. b. Must pay for the cards with services. c. May pay for the cards with cash, goods, or services. d. Must pay the fair market value of the cards.

May pay for the cards with cash, goods, or services (C)

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 reasonable time. Gelato a. May treat the offer as having lapsed. b. Must assume that Fresh Dairy has started to perform. c. Must contact Fresh Dairy. d. Must notify Hector's.

May treat the offer as having lapsed (A)

Refined Grains, Inc., agrees to sell to Sunny Cereal Company a certain quantity of refined oats each week but no mention is made of where the goods are to be delivered. In general, the UCC requires that the delivery take place at A. A neutral place of business halfway between the parties' locations. B. A "reasonable" place of delivery. C. Refined's place of business. D. Sunny's place of business.

Refined's place of business (C)

Development Corporation and Equipment Rental,Inc., 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 a. Mutually agreeing not to commit fraud. b. Repeating the terms in a phone call. c. Setting out the terms in a memo. d. Shaking hands on the deal.

Setting out the terms in a memo (C)

Expert Stitching Corporation enters into a contract to sell denim clothing to Fine Fashion Company, which in turn sells a pair of jeans to Grady, a consumer. In contrast to standards that apply to consumers, the UCC imposes on merchants a. Less strict legal standards. b. Special business standards. c. Stricter ethical standards. d. The same overall standards.

Special business standards (B)

Farmers Produce, Inc., and Growers Market enter into a contract for the delivery of locally grown fruits and vegetables. The parties use a standard Farmers 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. Growers Market refuses to pay for the spoiled goods. Refer to Fact Pattern 13-1. Farmers Produce responds that it did not waive payment for spoiled goods in the parties' previous transaction. Farmers Produce is arguing that the court should take into account

The course of dealing

Farmers Produce, Inc., and Growers Market enter into a contract for the delivery of locally grown fruits and vegetables. The parties use a standard Farmers 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. Growers Market refuses to pay for the spoiled goods. Refer to Fact Pattern 13-1. Growers Market contends that the practice in the trade with respect to payment for spoiled produce justifies its refusal to pay. Growers Market is arguing that the court should take into account

The usage of trade

A court can refuse to enforce a contract that the court deems to have been unconscionable at the time it was made. (T/F)

True

A merchant is a person who deals in goods of the kind involved in the sales contract or who holds herself or himself out as having skill or knowledge peculiar to the practices or goods being purchased or sold. (True/False)

True

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 a. The mirror image rule. b. The principle of fair trade. c. The predominant-factor test. d. The doctrine of unconscionability.

the doctrine of unconscionability