Chapter 8

Question 1

What is a sales contract?

Answer 1

Is a specific type of contract where one party (vendor or seller) is obligated to deliver and transfer ownership of a good to a second party (vendee or buyer) who is obligated to pay for the good in money or its equivalent.

Question 2

List the 6 main features of a sales contract.

Answer 2

1. Consensual
2. Bilateral
3. Onerous
4. Commutative
5. Nominate
6. Principle

Question 3

What source of law govern sales contracts?
A. Common Law
B. The Uniform Commercial Code
C. Statutory Law
D. Federal Law

Answer 3

B. The Uniform Commercial code

Question 4

Describe the difference between an express and implied warranty.

Answer 4

Express warranty is where the seller explicitly guarantees the quality of the good/service. While implied warranty is when that good sold by merchant does not infringe upon trademark.

Question 5

What is the definition of a good?

Answer 5

Goods are tangible items which are movable at the time of identification to the contract for sale.

Question 6

Distinguish a shipment contract from a destination contract.

Answer 6

A shipment contract occurs when the responsibility of seller to make the shipping arrangements and to transfer the goods to the common carrier. Under this contract, title passes to the buyer at the time of shipment, so the buyer bears the risk of loss, even when they have not taken possession of the goods. A destination contract occurs when the seller is required to deliver the goods to a location that is stipulated in the contract. Under this contract, title transfers when the goods are delivered, but the seller bears the risk of loss until that time.

Question 7

What is a warranty in sales contract?

Answer 7

Is a legally binding commitment.

Question 8

List the typical types of defect in a breach of the implied warranty.

Answer 8

1. Design defects
2. Manufacturing defects
3. Inadequate instructions
4. Inadequate warnings

Question 9

The following are possible remedies to buyers under the UCC:
A. Cancel the contract
B. Obtain Cover
C. Sue
D. All the above

Answer 9

All the above

Question 10

What is a breach of warranty?

Answer 10

Is when the buyer believes that there has been a breach of the implied warranty of merchantability, it is their responsibility to demonstrate that the good was defective, that made the good not fir for purpose, and that this defect caused the plaintiff harm.