Chapter 25 Remedies

Question 1

remedies of the seller

Answer 1

to withhold delivery of the goods
to stop delivery of the goods
to identify goods to the contract
to resell the goods and recover damages
to recover damages for nonacceptance or repudiation
to recover the price
to recover incidental damages
to cancel the contract
to reclaim the goods upon the buyers insolvency

Question 2

remedies of the buyer

Answer 2

to cancel the contract
to recover payments made
to cover
to recover damages for nondelivery ot repudiation
to recover identified goods upon the sellers insolvency
to sue for replevin
to sue for specific performance
to enforce a security interest in goods
to recover damages for breach in regard to accepted goods
to recover incidental damages
to recover consequential damages

Question 3

contractual provisions affecting remedies

Answer 3

liquidation or limitation of damages
modification or limitation of remedy by agreement
statute of limitations

Question 4

at any stage of a contract for the sale of goods

Answer 4

either party may breach or repudiate the contract

the seller may deliver defective goods, too few (or too many) goods, the wrong goods or no goods

Question 5

the buyer may refuse to accept

Answer 5

conforming goods or fail to pay for conforming goods

Question 6

breach may occur when the goods are in

Answer 6

the possession of the seller, in the possession of a bailee of the buyer, in transit to the buyer or in the possession of the buyer

Question 7

remedies, therefore

Answer 7

need to address both the type of breach of contract and the location of the goods

consequentially, the code provides separate and distinct remedies for the seller and for the buyer, each specifically keyed to the type of breach and the situation of the goods

Question 8

in all events, the purpose of the code

Answer 8

is to put the aggrieved party in a position as good as the one he would have been in, had the other party fully performed, and therefore provides that its remedies be administered liberally

the purpose of remedies under the code is compensation, therefore, punitive damages are generally not available

Question 9

to withhold delivery of the goods

Answer 9

a breach by the buyer will permit the seller to withhold the goods

in an installment contract a buyers breach as to any separate delivery which impairs the value of the entire contract will permit the seller to withhold the rest

Question 10

to stop delivery of the goods

Answer 10

a seller may stop goods in transit if the buyer is insolvent or repudiates the contract

this right is terminated if
a the buyer receives the goods
b a bailee of the goods (not a common carrier) informs the buyer that the goods are being held on the buyers behalf
c the carrier acknowledges to the buyer that he holds the goods for the buyer by reshipment or as warehouseman or
d a negotiable document of title is transferred to the buyer

Question 11

to identify goods to the contract

Answer 11

upon buyers breach seller may identify goods to the contract

any unfinished goods may be either
1 completed and identified to the contract or
2 not completed and sold as scrap

Question 12

to resell the goods and recover damages

Answer 12

a proper resale of goods made in good faith and in a commercially reasonable manner will permit the seller to recover from the buyer the difference between the resales price and the contract price plus incidental damages minus expenses saved

resale may be public or private, seller must give the buyer notification of the private sale

only identified goods may be sol in public sales except where there is a recognized market for a public sale of future goods of the kind involved

Question 13

public sales are to be conducted

Answer 13

in the usual place and the buyer must receive reasonable notice unless the goods are perishable and will lose value rapidly

Question 14

to recover damages for nonacceptance or repudiation

Answer 14

as an alternative to selling the goods the seller may recover damages as the difference between the market price at the time and place of tender and the unpaid contract price, plus incidental damages minus any expenses saved

lost profits plus reasonable overhead maybe recovered if the previous recovery formula will not put the seller in as good as position as performance would have

Question 15

to recover the price

Answer 15

a seller may recover price
1 upon the buyers acceptance
2 where conforming goods are lost or damaged after the risk of loss has passed to the buyer
and 3 where identification has occurred and there is no ready market for resale

the seller must hold identified goods for the buyer

Question 16

to recover incidental damages

Answer 16

recoverable on buyers breach and includes commercially reasonable charges, expenses, or commissions directly resulting from the breach

Question 17

to cancel the contract

Answer 17

where the buyer wrongfully rejects or revokes acceptance of the goods, fails to make a payment due on or before delivery, or repudiates the contract in whole or in part, the seller may cancel the part of the contract that concerns the goods directly affected

cancellation effects a discharge of contract duties while preserving the right to ay appropriate remedies

Question 18

difference between termination and cancellation

Answer 18

termination - ending for reasons other than breach

cancellation - for breach, can recover beyond day of cancellation

Question 19

to reclaim the goods upon the buyers insolvency

Answer 19

the seller may demand return of the goods if the buyer is insolvent and the request is made within ten days of the date that the buyer received the goods

in cases where the buyer perpetrated a fraud as to her insolvency in writing and within three months of delivery, then the ten day rule in inapplicable

reclaiming goods excludes a seller from any other remedies with respect to these goods

Question 20

remedies of the buyer

goods vs money vs obligation

Answer 20

goods - 5-8
obligation - 1
money - 2-4, 9-11

Question 21

to cancel the contract

Answer 21

the buyer may cancel the contract with respect to the goods involved if the seller repudiates, or fails to deliver, or if the buyer rightfully rejects or justifiably revokes acceptance of the goods

if a breach by the seller concerns the whole contract, the buyer may cancel the entire contract

the buyer must give the seller notice of his cancelation, and is then excused from further performance or tender on his part

Question 22

to recover payments made

Answer 22

if a seller breaches a contract, the buyer may recover as much of the price as he has already paid

Question 23

to cover

Answer 23

permits the buyer to purchase substitute goods following the sellers breach

the buyer must act in good faith and without unreasonable delay

cover is an elective choice and is not required of the buyer, but the buyer may not recover consequential damages f they could have prevented by cover

the buyer may recover the difference between the cost of cover and the contract price, plus incidental and consequential damages minus expenses saved

Question 24

to recover damages for nondelivery or repudiation

Answer 24

available if the buyer doesn’t cover

damages are difference between the market price at the time when the buyer learned of the breach and contract price, plus incidental and consequential damages minus expenses saved

buyer may not recover consequential damages if they could have avoided by cover

Question 25

to recover identified goods on the sellers insolvency

Answer 25

if some or all of the purchase price has been prepaid, a buyer acquires a special property intent in identified goods and may recover the goods from a seller who has become insolvent within ten days following receipt of the first installment of the price

this special property interest exists even if the goods are nonconforming and the buyer would have the right to return or reject them

to exercise this remedy, the buyer must tender to the seller any unpaid portion of the price

Question 26

to sue for replevin

Answer 26

allows buyer to recover specific identified goods being held unlawfully by the seller

the buyer must have been unable to cover or the goods must have been shipped with a security interest reserved in the seller and satisfaction of the interest previously tendered

Question 27

to sue for specific performance

Answer 27

specific performance is an equitable remedy compelling the party in breach to perform the contract according to its terms

specific performance is is available if legal remedies are inadequate, where goods are unique or in other proper circumstances

Question 28

to enforce a security interest in the goods

Answer 28

a buyer having possession of goods following a rightful rejection or revocation will have a security interest in the goods to the extent of any expenses incurred, and for any party of the price paid to the seller

the buyer may hold such goods and resell them in the same manner as an aggrieved seller may resell the goods, and then return the proceeds beyond the amount of her security interest to the seller

Question 29

to recover damages for breach in regard to accepted goods

Answer 29

damages are available to the buyer who accepts the goods, and then gives timely notification or breach due to nonconforming goods or breach of warranty

in breach of warranty, the measure of damages is the difference at the time and place of acceptance between value of the goods that have been accepted and the value that the goods would have had if they had been as warranted, unless special circumstances show proximate damages of a different amount

where appropriate, incidental and consequential damages may also be recovered

Question 30

to recover incidental damages

Answer 30

the buyer may also recover incidental damages, in addition to remedies such as covering, recovering damages for nondelivery or repudiation, or recovering damages for breach in regard to accepted goods

incidental damages include expenses elated to the inspection, receipt, transportation, care and custody of the goods, and other commercially reasonable charges

Question 31

to recover consequential damages

Answer 31

those damages that result from the goods not meeting the buyers requirements, which were reasonably foreseeable by the seller, or from defects which proximately caused injury or property damages asked on breach of warranty

particular needs of the buyer usually must be made known to the seller, whereas general needs usually need not be

Question 32

liquidation or limitation of damages

Answer 32

specified damage awards may be provided for in the contract will be upheld only if reasonable

excessive liquidated damages provisions will not be enforced

where the seller justifiably withholds delivery of goods due to buyers breach, buyer is entitled to restitution of any amount by which the sum of buyers payments exceeds the liquidated damages agreed to, or in the absence of such agreement, to the extent that the buyers payments exceed the lesser of 20% of the total performance for which the buyer is obligated under the contract or $500

Question 33

modification or limitation of remedy by agreement

Answer 33

the sales contract may expressly allow remedies in addition to or instead of those provided in the code and may limit or change the measure of damages recoverable in the event of breach

a remedy provided by the contract, however, is optional unless it is expressly agreed t be the sole remedy

where circumstances cause an exclusive or limited remedy to fail in its essential purpose, the injured party may resort to remedies provided by the code

Question 34

statute of limitations

Answer 34

any action for breach of a sales contract must be begun within four years after the cause of action has accrued