Rejection, Revocation, And Acceptance Lecture 4/9

Question 1

What is the buyer’s right regarding nonconforming goods?

Answer 1

The buyer has the right to reject nonconforming goods

This right is contingent on following proper procedures.

Question 2

What must occur before a buyer can reject goods?

Answer 2

Rejection must occur within a reasonable time following delivery

The definition of ‘reasonable time’ depends on the nature and circumstances of the goods.

Question 3

What is required for the buyer to determine whether to reject goods?

Answer 3

The buyer must have a reasonable opportunity to inspect the goods

This may include using or testing the goods if they are complex.

Question 4

What happens if a buyer fails to inform the seller of a defect?

Answer 4

The buyer may be precluded from asserting that defect later

This is applicable if the seller could have cured the defect if notified.

Question 5

True or False: A buyer can use goods after rejection has been communicated.

Answer 5

False

The buyer should not act like they own the goods after rejection.

Question 6

What is the consequence if a buyer does not specify defects in the notice of rejection?

Answer 6

The buyer may be precluded from relying on unspecified defects

This applies if the seller could have cured the defect.

Question 7

What obligations does a merchant buyer have regarding rejected goods?

Answer 7

A merchant buyer must follow reasonable instructions from the seller

They must also make reasonable efforts to sell perishable goods.

Question 8

What options does a buyer have if they notify the seller of rejection?

Answer 8

The buyer can store, send back, or sell the goods

They are entitled to reimbursement for reasonable expenses incurred.

Question 9

What creates a security interest for the buyer after rightful rejection?

Answer 9

The buyer gains a security interest in the goods as collateral for payments made

This includes expenses related to inspecting and caring for the goods.

Question 10

What does the term ‘acceptance’ refer to in Article 2?

Answer 10

Acceptance refers to the buyer’s reaction to goods, not the acceptance of an offer

This has different implications than acceptance in contract formation.

Question 11

What signifies acceptance of goods by the buyer?

Answer 11

Acceptance can be signified by inspection or payment for the goods

Payment alone is not conclusive evidence of acceptance.

Question 12

What can happen if a buyer pays for goods but later finds them defective?

Answer 12

The buyer may still seek to reject the goods despite having paid

This situation may arise if the buyer decides the payment was foolish after inspection.

Question 13

What is the distinction between notice of intent to reject and actual notice of rejection?

Answer 13

Notice of intent to reject indicates a future possibility, while actual notice is immediate

This distinction is important in legal contexts.

Question 14

What must a buyer do with physical possession of rejected goods?

Answer 14

The buyer must hold the goods with reasonable care

This obligation lasts until the seller retrieves the goods.

Question 15

What does § 2605 require regarding the notice of rejection?

Answer 15

The buyer must state any defects discovered through reasonable inspection

Failure to do so may preclude reliance on those defects later.

Question 16

What authority does an employer have over an employee’s actions?

Answer 16

An employer has authority over actions but may not cover all actions of the employee

This can lead to situations where an employee exceeds their authority.

Question 17

What can happen if a buyer fails to make an effective rejection?

Answer 17

Acceptance may occur due to failure to act in a timely manner or to provide notice

This can happen after the buyer has had the opportunity to inspect the goods.

Question 18

What is the significance of a notice of cancellation in the context of rejection?

Answer 18

A notice of cancellation must specify grounds for rejection to be effective

If grounds are not specified, the seller may not be able to assert the effects of the rejection.

Question 19

What distinguishes a wrongful rejection from an effective rejection?

Answer 19

A wrongful rejection lacks a good basis for rejection but can still be effective

An effective rejection allows the buyer to assert rights without liability for the goods.

Question 20

What are the buyer’s options when faced with nonconforming goods?

Answer 20

• Reject the whole
• Accept the whole
• Accept part and reject the rest

These options depend on whether the goods conform to the contract.

Question 21

What happens when a buyer accepts goods?

Answer 21

The buyer cannot later reject the goods and is obligated to pay the contract price

Acceptance means the buyer loses certain rights, such as canceling the contract.

Question 22

What must a buyer do to recover damages after accepting goods?

Answer 22

Notify the seller of breach within a reasonable time after discovering it

Failure to do so may prevent recovery of damages.

Question 23

What is the burden of proof when a buyer accepts goods?

Answer 23

The burden shifts to the buyer to prove that the goods were defective

This can be difficult after a period of time has passed since acceptance.

Question 24

Fill in the blank: Acceptance occurs when the buyer does any act inconsistent with the seller’s ______.

Answer 24

ownership

Question 25

How does a buyer accept a commercial unit?

Answer 25

By accepting any part of it, the entire commercial unit is accepted ## Footnote This means the buyer cannot selectively reject parts of it.

Question 26

What is a commercial unit?

Answer 26

A unit of goods treated as a single whole for purposes of sale ## Footnote It can be a single item or a set that, if divided, would materially impair its character or value.

Question 27

What constitutes acceptance according to the statute?

Answer 27

* Using the goods * Changing the goods * Failing to reject in a timely manner ## Footnote These actions indicate acceptance of the goods.

Question 28

What are the implications of a buyer using goods after delivery?

Answer 28

It may indicate acceptance, limiting the buyer's options for rejection ## Footnote This can complicate any potential claims for breach.

Question 29

True or False: A buyer can both reject and accept a single item simultaneously.

Answer 29

False

Question 30

What happens if a buyer discovers a defect after acceptance?

Answer 30

The buyer may have rights to revoke acceptance under strict conditions ## Footnote These conditions are generally more limited than those for rejection.

Question 31

What case illustrates the importance of acceptance and burden of proof?

Answer 31

Marmron vs. Yonkers Graceace W ## Footnote In this case, the buyer could not prove the horse was lame upon delivery.

Question 32

What does a timely rejection require from the buyer?

Answer 32

The buyer must act within a reasonable time after inspection ## Footnote Delays may lead to acceptance by default.

Question 33

What is the key distinction between acceptance and rejection in sales?

Answer 33

Acceptance obligates the buyer to pay, whereas rejection allows for cancellation of the contract ## Footnote This distinction is crucial in determining rights and responsibilities.

Question 34

What happens if a buyer accepts part of a commercial unit?

Answer 34

Acceptance of a part of any commercial unit is acceptance of the entire unit.

Question 35

What is required from a buyer who accepts a good?

Answer 35

The buyer is obligated to pay for it.

Question 36

Can a buyer still sue after accepting a good?

Answer 36

Yes, the buyer can sue for breach of express warranty.

Question 37

What must a buyer do to preserve their rights for breach of warranty?

Answer 37

Give notice of the breach as required by 2607 subpart 3.

Question 38

True or False: The notice of breach must be very specific.

Answer 38

False.

Question 39

What is the consequence of using a good after acceptance?

Answer 39

The buyer may lose the right to revoke acceptance.

Question 40

What is the standard for revocation of acceptance?

Answer 40

The nonconformity must substantially impair the value of the good.

Question 41

What case illustrates the concept of substantial impairment?

Answer 41

The Waddell case.

Question 42

What must a buyer provide to prove substantial impairment?

Answer 42

Objective evidence that their needs are not being met.

Question 43

Fill in the blank: A buyer may revoke acceptance if the nonconformity _______ substantially impairs its value.

Answer 43

[substantially]

Question 44

What is a reason a buyer might have for accepting a nonconforming good?

Answer 44

Assuming that the nonconformity would be cured.

Question 45

What must a buyer do to effectively revoke acceptance?

Answer 45

Follow the process and act within a reasonable time after discovering the grounds.

Question 46

What happens if a buyer fails to follow the revocation process?

Answer 46

Revocation is ineffective.

Question 47

If a buyer successfully revokes acceptance, what rights do they have?

Answer 47

They have the same rights and duties as if they had rejected the goods.

Question 48

True or False: A buyer can revoke acceptance at any time without conditions.

Answer 48

False.

Question 49

What must a buyer do if they have physically accepted the goods?

Answer 49

They must protect the goods reasonably until the seller takes them back.

Question 50

What is the consequence of a buyer changing the condition of the goods after acceptance?

Answer 50

It may affect their right to revoke acceptance.

Question 51

What does the comment 5 of 2607 state about notice of breach?

Answer 51

It must be more substantial than a notice of rejection but not as specific.

Question 52

What is a potential outcome if a buyer does not act on their right to revoke?

Answer 52

The buyer remains responsible for the accepted goods.

Question 53

What does the buyer need to demonstrate regarding nonconformity to revoke acceptance?

Answer 53

The nonconformity substantially impairs value to them.