quiz 3 Flashcards
Steps for Courts to Assess an Express Warranty:
Determine if the statement was an affirmation of fact or opinion.
If yes, decide if the statement was part of the basis of the bargain.
Assess whether the warranty was breached.
express warranty created when
- the seller makes an affirmation of fact or promise relates to the good
- seller provides a description of the goods
- provides a sample or model
** all must be part of the bargain and cannot be simply puffery
what is a sample
taken from the bulk
what is a model
offered when the actual item is unavailable (could be diff size)
implied warranty of merchantability
- ensures the goods are fit for ordinary purpose
- arises automatically unless disclaimed
- guarantees the goods will function as intended
- seller must be a MERCHANT
for implied warranty of merchantability, the seller must be
a merchant
implied warranty of fitness for a particular purpose
- arises when the seller knows the buyers specific reason for purchasing the product
- the buyer relied on the sellers advice to choose the product
- the seller knows that the buyer is relying on the sellers skill
basis of the bargain means
the buyers reliance
disclaim implied merchantability could be by
could be by performance, trade, or dealing. can be oral or written
disclaim implied merchantability must mention
merchantability clearly - written disclaimers must be conspicuous
to disclaim implied fitness for particular must only
be in writing and still must be conspicuous
limitations of remedies
if no form of remedy is found, buyer will be fairly placed where they were before the contract
disclaimer of warranties added after the contract are…because
ineffective because it would be a modification which requires assent from both parties
Warranty of Title:
- The seller is warranting that they have good title to the goods being sold.
- If it is found that the seller does not have the title to the goods, then the rightful owner of the title can receive their goods back.
- And the buyer can sue for bearch of warranty of title, whether or not they knew that they did not have good title, because it is under strict liability.
if the exclusive remedy of the disclaimer fails to put the buyer back in their original position then
the buyer may ignore that term
Consequential damages occur when
a defective product causes substantial harm.
Sellers may disclaim consequential damages, but:
** The disclaimer must be conspicuous.
** Courts may limit a disclaimer if it is deemed unconscionable.
** If the essential purpose of the original remedy fails, a buyer can argue that the consequential damages limitation should also be void.
A condition is
an event, uncertain to occur, which must happen before performance under a contract becomes due, unless excused.
a condition must be
specified in order to be effective
If contract language is ambiguous, courts favor construing it as a
promise to avoid forfeiture.
- The courts will use the intent of the parties and rules of interpretation.
- Sine the court is imposing it, it must be a SUBSTANTIAL PERFORMANCE.
- courts prefer to interpret it as a promise rather than a condition so that one party does not unfairly lose their rights or benefits under the contract.
- Courts look at what the parties intended and use established legal rules to decide how to interpret the contract.
ambiguous language example
A homeowner contracts with a painter, stating, “Payment will be made if the work is completed by June 1.”
If the language is unclear, the court may interpret it as a promise rather than a strict condition.
This means the homeowner must still pay if the painter substantially completes the job but finishes a few days late, rather than completely forfeiting payment.
The court would consider the parties’ intent—if they didn’t intend for strict timing to be the deciding factor, the painter would still be entitled to payment, possibly with a small deduction for the delay.
Effect of Condition, Duty & Condition And Duty
- Creating a condition -
performance of the other party is completely dependent on the condition occurring. If party delays to perform, the party cannot get delay damages, only just does not have to pay.
Effect of Condition, Duty & Condition And Duty
- Duty
if a party promises to perform at a certain time and then delay. Performance of the other party is still necessary even if the duty is delayed (they may be able to recover delay damages)
Effect of Condition, Duty & Condition And Duty
- Condition And Duty -
If a party promises to perform and the other party makes their duty dependent on the performance. The party may collect damages if there is a delay in the performance and will also not have to perform.
Promissory condition
A condition and also a promise that the condition will occur. Here, there is an event that must occur before a party’s performance becomes due and there is also a promise by the party that the event will occur.
Implied-in-Fact Conditions (Inferred from contract terms)
- strict compliance
If performance requires an action by one party (e.g., giving notice), courts may imply a condition.
It is gathered from the terms of the contract by interpretation.
Example: A landlord responsible for repairs may have an implied condition that tenants must notify them of needed repairs.
Express Conditions (Agreed upon by the parties)
- strict compliance
Identified by phrases such as “if,” “on condition that,” “provided that,” “subject to,” “in the event that.”
Courts determine whether an agreement creates a condition based on contract interpretation.
Constructive Conditions (Imposed by law for fairness) implied in law to do justice
- A constructive condition in contract law is an obligation that courts impose to ensure fairness and justice, even though it is not explicitly stated in the contract.
- Substantial performance occurs when a party has fulfilled enough of their contractual obligations that the essence of the contract is met, despite minor deviations.
under constructive conditions if a party
If a party substantially performs, they can still recover damages, but still must perform their duties.
Excuse of a Condition
Hindrance or Bad Faith:
- Avoiding Disproportionate Forfeiture
- Waiver of a Condition
consideration cannot
be waived
Hindrance or Bad Faith
The non-occurrence of the condition may be excused If a party with whom hte duty is dependent on a condition prevents or obstructs the fulfillment of a condition, it may be excused.
Avoiding Disproportionate Forfeiture:
If enforcing a condition causes unfair forfeiture, courts may excuse it unless it was a material part of the exchange. Waivers applies primarily to conditions which may seem as if they are procedural or technical
Waiver of a Condition:
A party may waive a condition that only benefits them unless it was a material part of the contract.
Retraction of a waiver: A waiver may be retracted before the time for occurrence of the condition has expired. If so, the condition may be retracted unless the other party has relied on the waiver such that retraction would be unjust. If not, the the condition remains waived
A promisor whose performance is conditional may indicate by either words or conduct that she will perform even if the condition does not occur.
how to determine is the term is consideration or a condition
If the term is the subject of the contract, it is consideration; if it relates to an aspect of performance, it is a condition
UCC 2-209
a contract can be modified without needing new consideration
- a waiver can be oral or writing even if the orig contract required modis to be in writing
the waiving party can r..
retract the waiver with reasonable notice unless the other party has materially relied on the waiver
a waiver is a
unilateral act, does not need the other partys assent
