Chapter 10 - E-commerce and sales of goods and services

Question 0

what are approval clauses?

Answer 0

although signed by a sales representative, the order is not a valid contract unless and until it has been approved by a person of a specified level

Question 1

what is a shrink-wrap agreement?

Answer 1

purchaser is given the right to return the product for a full refund if they find the terms of the license unacceptable. contract terms are deemed accepted when buyer uses ticket

Question 2

what are option contracts?

Answer 2

UCC permits merchants to enter into option contracts for the sale of goods without payment of consideration.
the option cannot be in effect for more than 3 months

Question 3

what is the statute of frauds?

Answer 3

section 2-201 of the UCC - provides that contracts for the sale of goods for $500+ are unenforceable unless statement, signature, and quantity of goods are in writing

Question 4

what is the uniform computer information transactions act (UCITA)

Answer 4

expressly validates most software license shrink-wrap and click-wrap agreements

Question 5

what is the United Nations commission on international trade (UNCITRAL)

Answer 5

model law on electronic signatures covers how a signature requirement may be met, the conduct of the signatory, and the requirements for service providers that certify electronic signatures

Question 6

what is an express warranty?

Answer 6

explicit guarantee by the seller that the goods will have certain qualities.

1. seller must make statement or promise relating to the goods, provide a description of goods, or furnish a sample
2. buyer must have relied on statement, promise, or sample in making the purchase decision

Question 7

what is puffing?

Answer 7

expressing an opinion about the quality of goods.

puffing is not a warranty

Question 8

what is an implied warranty of merchantability?

Answer 8

guarantees that the goods are reasonably fit for the general purpose for which they are sold and that they are properly packaged and labled.
implied even if seller makes no statements and furnishes no sample

Question 9

what is an implied warranty of fitness for a particular purpose?

Answer 9

guarantees that the goods are fit for the particular purpose for which the seller recommended them.

1. buyer must have particular purpose for goods
2. seller know or had reason to know of that purpose
3. buyer relied on seller’s expertise
4. seller knew or had reason to know of buyer’s reliance

Question 10

how can a seller limit their liabilities?

Answer 10

they don’t need to make any express warranties
they may use expressions such as “as is”
they can include a provision limiting the seller’s responsibility for defective goods to repair or replacement for a specified period of time

Question 11

what is the magnuson-moss warranty act?

Answer 11

protects consumers against deception in warranties.
if a seller engaged in interstate or foreign commerce makes an express written warranty to the buyer, the seller may not disclaim the warranties of merchantability and fitness for a particular purpose

Question 12

what are the requirements of a full warranty?

Answer 12

1. must give consumer the right to free repair of product within a reasonable time period or, after a reasonable number of failed attempts to fix the product, permit the customer to elect a full refund or replacement of a defective product.
2. warrantor may not impose any time limit on the warranty’s duration.
3. warrantor may not exclude or limit damages for breach of warranty unless such exclusions are conspicuous on the face of the warranty

Question 13

what is strict liability in tort for defective products?

Answer 13

an injured person does not need to show that the defendant was negligent or otherwise at fault, or that a contractual relationship existed between the defendant and injured party.
injured person must show: 1. defendant was in chain of distribution of a product sold in a defective condition 2. the defect caused the injury
they can also sue for negligence if they can prove that the defendant failed to use reasonable care in its design or manufacture

Question 14

what does an injured party need to show to prove a product is defective?

Answer 14

1. product was defective when it left hands of defendant

2. defect made the product unreasonably dangerous

Question 15

what does “negligent per se” mean?

Answer 15

failure to comply with regulatory standards is often sufficient to prove that a product is negligent without the need to prove anything else

Question 16

what is the difference between a manufacuring deefect, design defect, and failure to warn?

Answer 16

manufacturing defect - flaw in product that occurs during production
design defect - inadequate design or poor choice of materials makes product dangerous to users
failure to warn - product must carry adequate warnings of risks involved in normal use

Question 17

what is successor liability?

Answer 17

a corporation purchasing or acquiring the assets of another is liable for its defective products and other debts if there is 1. a consolidation or merger 2. an express or implied agreement to assume such obligations

Question 18

what are defenses to product liability cases?

Answer 18

comparative fault
assumption of risk
obviousness of risk
misuse of product
state-of-the-art defense
preemption