Practice Set 3

Question 1

Under the UCC, can extrinsic evidence of additional terms be admitted if the writing completely expresses all terms of the parties’ agreement?

Answer 1

No, despite presuming partial integration under the UCC, writing that expresses all terms of the agreement overrides this presumption

Question 2

When is payment due for installment contracts if supplied by the UCC?

Answer 2

Payment for installment contracts is due upon each delivery, unless the price cannot be apportioned

Question 3

When is the parole evidence rule not applicable?

Answer 3

1. Defense in formation / enforcement of contract - ie: mistake, misrepresentation, duress, etc.
2. Separate deal
3. Condition precedent
4. Ambiguity and interpretation - plain meaning / context
5. Subsequent agreements
6. UCC - (1) express terms, (2) course of performance, (3) course of dealings, (4) trade usage

Question 4

What is the plain meaning rule?

Answer 4

The objective definitions of contract terms control the meaning of the contract - (1) can be used to ascertain meaning despite total integration but (2) irrelevant when determining if contract is integration

Question 5

What is a default type of auction if no type is specified?

Answer 5

Default is with reserve, meaning that the seller has the right to withdraw an item from sale at any time before the auctioneer announces the completion of the sale

Question 6

When is the non-breaching party’s damages limited to out-of-pocket reliance damages?

Answer 6

When the breaching party does so in good faith

Question 7

When does an acceptance with different terms become a counteroffer under the UCC?

Answer 7

When the acceptance is expressly conditioned on assent to the modified terms

Question 8

What happens under the UCC if there are different terms in an acceptance without expressly conditioning the acceptance on these different terms?

Answer 8

They are treated as a proposal for addition to the contract that must be separately accepted by the offeror to become a part of the contract

Question 9

What happens under the UCC when a party accepts but with different terms and both parties are merchants?

Answer 9

Contract exists under terms of acceptance unless:

1. Terms materially alter the agreement,
2. The offer expressly limits the terms, OR
3. The (a) offeror objects to the new terms (b) within a reasonable time (c) after notice of the new terms is received