MGMT CHAPTER 12: SALES & LEASE LAW

predominant-factor test

A test courts use to determine whether a contract is primarily for the sale of goods or for the sale of services. if primarily a goods contract, even a dispute over services portion will be decided under UCC

Implied Warranty of Merchantability

A warranty that goods being sold or leased are reasonably fit for the ordinary purpose for which they are sold or leased, are properly packaged and labeled, and are of fair quality.

Which section of the Uniform Commercial Code (UCC) applies to contracts for sales of goods? Article 2A Article 2 Article 4 Article 3

Article 2

conforming goods

Goods that conform to contract specifications.

What characteristics must an item possess to be classified as a "good"? Choose 2 answers. It must be moveable. It must be taxable. It must have a definable cash value. It must be tangible.

It must be moveable. It must be tangible.

express warranties

Specific representations by the seller that buyers rely on regarding the goods they purchase.

perfect tender rule

States that if goods or tender of delivery fail in any respect to conform to contract, buyer/lessee has right to: 1) accept the goods; 2) reject entire shipment; or 3) accept part and reject part

How does the 1980 United Nations Convention on Contracts for the International Sale of Goods (CISG) differ from the Uniform Commercial Code (UCC)? Choose 3 answers. The CISG does not apply to consumer sales. The CISG is stricter on requiring mirror image acceptances. Under the CISG, all sales contracts of $500 or more must be in writing. Under the UCC, an irrevocable offer must be in writing, but under the CISG it can be oral.

The CISG does not apply to consumer sales. The CISG is stricter on requiring mirror image acceptances Under the UCC, an irrevocable offer must be in writing, but under the CISG it can be oral.

In what ways does Article 2 of the (UCC) differ from contract rules under the common law? 3 Under UCC, the only required definite term is quantity of product being sold. Under UCC, any manner of showing agreement to contract is accepted, but under the common law acceptance must mirror the offer. Under UCC, contracts must be written while the common law does not require writing. Under UCC, merchants have more flexibility in having open terms.

Under UCC, the only required definite term is quantity of product being sold. Under UCC, any manner of showing agreement to contract is accepted, but under the common law acceptance must mirror the offer. Under UCC, merchants have more flexibility in having open terms.

implied warranties

Warranties imposed by law, arising automatically because the sale has been made.

Which of the following qualifies as a "good" under Article 2 of the Uniform Commercial Code? stocks, if evidenced by a stock certificate a commercial freezer unit commercial office building undeveloped land

a commercial freezer unit

unconsciounability

a contract that is so unfair and one sided that it would be unreasonable to enforce it

What is the term for when a merchant gives a written, signed assurance that he or she will not revoke an offer for a stated period of time? a promised offer an accommodation offer a firm offer an irrevocable offer Assessment question

a firm offer

Commercial Impracticability

arises only when the parties, at the time the contract was made, had no reason to anticipate that the event would occur

Implied Warranty of Fitness for a Particular Purpose

arises when any seller knows the particular purpose for which a buyer will use the goods and knwos the buyer is relying on the skill and judgement of the seller to select suitable goods

article 2a of the UCC

governs contracts for the lease of goods, NOT land or buildings

article 2 of the UCC

governs sales contract/ the sale of goods. UCC rules overpass the common law contract rules when conflicts arise

tangible property

has physical existence—it can be touched or seen.

Magnuson-Moss Warranty Act

modifies UCC warranty rules to some extent when consumer transactions are involved. No seller is required to give a written warranty for consumer goods sold.

When does title to stolen goods transfer? when the thief sells the goods to a purchaser in good faith who does not know of the theft when they are stolen when they are deemed unrecoverable never

never

tender of delivery

occurs when seller delivers conforming goods to buyer

Under the Uniform Commercial Code (UCC), what is the only required term for a valid sales contract? price of goods being sold method of delivery place of delivery quantity of goods being sold

quantity of goods being sold

full warranty

requires free repair or replacement of any defective part

uniform commercial code (UCC)

section of law that governs the sale of goods; goal to simplify and streamline transactions; statutory law

merchant

someone who is in the business of buying or selling particular goods and who posesses or uses an expertise specifically related to those goods

intangible property

such as corporate stocks and bonds, patents and copyrights, and ordinary contract rights—has only conceptual existence and thus does not come under Article 2.

limited warranty

the buyer's recourse is limited in some fashion, such as the warranty might cover parts but not labor to repair the item

The default provision of the Uniform Commercial Code (UCC) is that, unless otherwise specified, title to goods being sold passes when: the goods are given to a carrier for shipment. a document of title is delivered to the buyer. the goods are physically delivered to the buyer. the goods are made available at a designated destination.

the goods are physically delivered to the buyer.

cure

the right of the seller or lessor to repair, adjust, or replace defective or nonconforming goods

firm offer

when a merchant-offeror gives assurances in a signed writing that the offer will remain open

Under the Uniform Commercial Code (UCC), risk of loss passes to the buyer: at the same time that title passes to the buyer. never, if the goods are entrusted to a bailee. whenever the contract designates it to pass. in a shipment contract, at the time that the shipment is delivered to the buyer.

whenever the contract designates it to pass.