Sale of Goods

Question 1

Sale of goods

Answer 1

All things (including specifically manufactured goods) which are moveable other than the money in which the price

Question 2

Mixed contracts

Answer 2

ordinarily, a court determines whether a mixed contract for goods and services is subject to (UCC) by considering whether the contract is for goods with labor incidentallyinvolved or for services with goods incidentally involved

Question 3

Sale of goods 2-106

Answer 3

The passing of title (of goods) from the seller to the buyer for a price

Question 4

Merchants

Answer 4

a. Tier 1 (dealer) - a person who deals in goods of the kind
b. Tier 2 (the professional) - a person who by his occupation holds himself out as having knowledge or skill peculiar to the practices or goods involved
c. Tier 3 (the merchant by agency) - a person to whom the knowledge or skill referred to above is attributed by his employment of any person who by his occupation holds himself as having such knowledge or skill

Question 5

“Merchant”

Answer 5

Means a person who deals in good of the kind or otherwise by his occupation holds himself out as having knowledge or skill peculiar to the practices or goods involved in the transaction or to whom such knowledge or skill may be attributed by his employment of any agent or broker or other intermediary who by his occupation holds himself as having such knowledge or skill

Question 6

Good faith

Answer 6

Probably does not extend to pre-contract shenanigans because other remedies may be available for example, a claim of misrepresentation, duress or mistake

Question 7

Every contract or duty within this Act imposes an obligation of:

Answer 7

good faith in its performance or enforcement

Question 8

Non Merchants

Answer 8

Honesty in fact

• an honest intention to abstain from taking unfair advantage of another, through technicalities of law, by failure to provide information or to give notice or by other activities which render the transaction unfair

Question 9

Merchants

Answer 9

Honesty in fact and fair dealing

Question 10

The duty of good faith is:

Answer 10

intended as a guaranty against “arbitrary or unreasonable conduct”

Breaches of good faith include conduct which violates community standards of decency, fairness or reasonableness

Question 11

Bad faith may consist of:

Answer 11

subterfuges and evasions

evasion of the spirit of the bargain, lack of diligence and slacking off, willful rendering of imperfect performance, abuse of power to specify terms and interference with or failure to cooperate in the other party’s performance

Question 12

Procedural unconscionability

Answer 12

the manner in which the contract was formed is unconscionable

unfairness in the formation of the contract which may include a variety of inadequacies or weaknesses such as age, literacy, lack of sophisticaiton, hidden or unduly complex contract terms, bargain tactics and the particualr setting surrounding the contract formation process

Question 13

Substantive unconscionability

Answer 13

A term or condition of the contract is unconscionable

hars, unfair or disproportionately one-sided terms

Question 14

Not intended to create an affirmative case

Answer 14

of action and a basis for recovery of damages - but rather unconscionably is a defense to enforceability of a contract or its terms

Question 15

Unsconscionability (some courts)

Answer 15

require both procedural and substantive unconscionability to have a right to attack the enforceability of the contract

Question 16

A person has notice of a fact when:

Answer 16

a. he has actual knowledge of it or
b. he has received a notice or notification of it or
c. from all the facts and circumstances known to him at the time in question he has reason to know that it exists

Question 17

A person “receives” a notice or notification when:

Answer 17

a. it comes to his attention; or
b. it is duly delivered at the place of business through which the contract was made or at any place held out by him as the place for receipt of such communications

Question 18

Effect - special property right created in the buyer

Answer 18

a. Buyer has an insurable interest (the right to insure the goods)
b. Availability of certain remedies to the buyer in the event seller refuses to deliver the goods
c. Buyer’s right to inspect the goods is triggered

Question 19

Trial Sales

Answer 19

Whenever buyer has contracteed for the privilege to return the goods even though they are conforming - two types of contracts

1. Sale or return - regarded as ac ompleted sale subject to the return policy
2. Sale on approval - buyer is treated as a bailee until buyer accepts the goods

Question 20

Sale or return

Answer 20

**Type of Goods: **purchased for resale

When to Make Election: in accordance with the contract or within reasonable time

**How to Make Election: **actual return

**Who Bears Expense of Return? **buyer

**Who Bears Risk of Loss During Election Period? **buyer

**When does title pass? **normal rules

**Are goods subject to claims of buyer’s creditors? **yes

Question 21

Sale on Approval

Answer 21

**Type of Goods: **purchased for use

**When to Make Election: **same

**How to Make Election: **give notice

**Who Bears Expense of Return? **seller

**Who Bears Risk of Loss During Election Period? **seller

**When does title pass? **upon acceptance

**Are goods subject to claims of buyer’s creditors? **no