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