Chapter 14 Flashcards
Caveat emptor
“let the buyer beware”
Consumer
An individual who acquires goods that are intended primarily for personal, family or household use
caveat venditor
“let the seller beware”
class actions
allows one or several persons to sue not only on behalf of themselves but also on behalf of many others similarly wronged
cease and desist order
requires the company to stop the specified conduct
consent order
a voluntary, court enforceable agreement to stop an illegal or questionable practice
restitution
the return to customers of money wrongfully obtained
the Consumer Product Safety Act
has the authority to issue and enforce safety standards for consumer products
adulterated
a product that doesn’t meet the minimum standard for purity and quality set by the FDA
Food and Drug Administration (FDA)
sets standards for cosmetics, foods and drugs
unfair trade practice
dishonest, fraudulent or anticompetitive business method
competition
the force that drives businesses to create new and better products and service
false and misleading advertising
deceives, makes untrue c,aims of quality or fails to reveal important facts
bait and switch
luring buyers to the store with an understocked, low priced good and then redirecting them to a more expensive product
corrective advertising
FTC may order the advertiser to admit wrongdoing and state the truth in future advertisements.
the 3 elements of a lottery
chance, consideration and payment
mislabeled goods
mislabeling a good to make it more marketable
product liability
the mixing of responsibility to compensate buyers, users, and bystanders for injuries caused by a defective product
warranty
assurance that the seller makes about the quality and performance of a product governed by the UCC
privity of contract
the relationship that exists as a result of a legally binding agreement
recovering damages
based in breach of warranty, torts of fraud, negligence or strict liability
express warranty
an assurance of quality or promise of performance explicitly made by the seller, may be oral or written
magnuson-moss act
states the seller must make written warranties available on products over $15
full warranty
express warranty that obligates the seller to repair or replace a defective product without cost to the buyer within a reasonable time
limited warranty
express warranty that provides less protection than full warranty
puffing
greatly exaggerated sales talk, sellers opinion
implied warranty
an implicit warranty obligation imposed by law on all sellers
warranty of title
seller warrants that he has title of the foods to transfers
warranty against encumbrances
goods are free of claims of a 3rd party, unpaid balances will be paid off before delivery
warranty against infringement
a merchant makes an implied warranty that the goods delivered will be free of 3rd party’s claim for patent, copyright, or trademarked infringement
warrant of merchantability
requires that the goods be fit for the ordinary purpose for which such goods are used
exclusion of warranties
seller may sell goods without any warranties on goods that are sold “as is” or “with all faults”
disclaimer
a notice of exclusion that must be written and easily noticed
lemon laws
exists at both state and federal levels to protect consumers who have purchased a defective product
