Sales Contract - 14 Flashcards
What is an output contract
This is a contract that says that the seller will sell to the buyer everything that they produce
This is an enforceable output contract
IS an oral agreement to sell goods for more than $500 enforceable
Normally they are not enforceable because they should be in writing. An exception is when the goods have been custom manufactured for the customer
In this case the buyer is on the hook for the entire contract price
What is a warranty of title
This provides assurance that the buyer is obtaining the goods free from any other claims
It is present in ALL sales of goods unless disclaimed
It is implied - so no need to be in writing
What are your rights as a buyer under UCC Sales Article
- Buyer has the righter to buy a substitute good (cover)
- or a right to capture identified goods (capture)
- they can demand specific performance if unique goods are involved
Can a buyer sue for punitive damages under UCC Sales Article
No - they can not
What is the implied warranty of merchantibility and can you disclaim
The implied warranty of merchantability is the automatic warranty say that the goods are in fair condition for their normal and ordinary purpose
It is implied when a a seller is a merchandiser
It can be disclaimed in writing or oral by the merchandiser
To establish a strict liability claim what must the plaintiff establish
That the defendant was in the business of selling the product
What does UCC cover
It cover s the sale of goods not services
sale of services is covered by common law not UCC
What is an express warranty and and an example
AN express warranty happens when you are given a sample, you approve sample and when the shipment arrive you can judge if the actual shipment is like or not like the sample
The sample become the basis of the bargain
If you do not have it written in the contract where the item will be deliver, the time frame for payment or the right to inspect - what rights for the buyer is implied
the buyer will pick them up at the seller
seller only need stop hold the goods
Buyer is entitled to inspect the goods before accepting them
Payment is due at the time the goods are picked up
Can a buyer request a guarantee of performance by the seller
Yes they can
If the seller refuses to give the guarantee of performance when requested the buyer can cancel the contract
What does strict liability imply
That there is no need to prove negligence on the part of the defendant
It is the product that is defective and damages occurred because of the defect
What is contributory negligence
This is when the buyer misused the product
what defense can you as a manufacurer use in a negligence case
You can say that you followed the customary practices of an industry
What kind of sales are involved in the UCC Sales article
goods or tangible personal property
What are some of the specific rules to UCC Sales Article
- many obligations that are only applicable to merchants include:
- honoring a firm offer
- both parties must perform it in good faith
- all sales are covered regardless of price
What is a implied warranty of titles
It arises automatically - does not have to be written
- the seller must deliver the goods free from any lien that the buyer was not aware of at the the time the contract was made
- applies to all sales - not just merchandisers
When goods are sent pursuant to a shipment contract - who is generally responsible for freight charges
The buyer is responsible for freight expenses
What kind of liability does a common carrier have
strict liability for the goods it transports
What is a warranty of title
This automatically exists in all sales
How is a firm offer created
It must be created by a merchant, must be in signed writing, and it must be for a reasonable period of time
What is a sale or return contract
Under the Sales Article of the UCC, a sale or return contract transfers title and risk of loss to the buyer at the time of sale but they revert back to the seller if the goods are returned.
What happens in a COD arrangement
In a C.O.D. arrangement, the buyer must pay the carrier for the goods before the carrier may tender delivery, after which the buyer may possess the goods and perform inspections.
Under UCC CAN you make a change to the contract and have it be binding
In a contract for the sale of goods covered under Article 2 of the UCC, a contract modification, such as a change in the delivery date, will be binding without additional consideration.
What is anticipatory breach
This is when you are told ahead that the contract will not be honored. This allows the otters party to take actions to minimize losses and then sue for the net losses remaining
What is a sales on approval arrangement
n a sale on approval arrangement, both risk of loss and title pass to the buyer when the buyer accepts the goods or after the trial period for approval has passed.
Under the Sales Article of the UCC, which of the following requirements must be met for a writing to be an enforceable contract for the sale of goods?
Under the UCC, only the type and quantity of goods involved needs to be explicit to create an enforceable contract for a sale of goods.
When can a buyer reject goods
the buyer may reject goods if the goods are defective or nonconforming.
what is bailment
A bailment exists when the owner of personal property delivers it to the possession of another party, who is entrusted with the item with the obligation to return or dispose of it according to the owner’s directions.
What happens when a merchant ships non conforming goods
when a merchant ships nonconforming goods, risk of loss remains with the seller regardless of the shipping terms.
What happens when one party to a contract is in breach - is the contract void or voidable
When one party to a contract is in breach, such as a seller shipping nonconforming goods, the contract may be voided by the other party, but not the one responsible for the breach. As a result, the contract is neither invalid nor void. When a delivery date is not specified, it is expected that goods will be delivered in a reasonable time and the contract would not be invalid. It is voidable by the buyer since nonconforming goods were shipped by the seller.
what happens when you are contracted to make 1oo custom things and you only make 85
since the contract called for the shipment of 100 custom cabinets, standard cabinets are nonconforming goods and represent a breach of contract.
The fact that the buyer may accept nonconforming goods is not an indication that there is no breach.
In addition, a counteroffer may be made prior to entering into a contract, but not once it has been entered into.
Axle is entitled to specific performance from Grand because of the unique nature of the goods.
When nonconforming goods are shipped, a buyer will generally cover by obtaining conforming goods from an alternate source with any additional cost recoverable from the seller. When goods are unique, however, resulting in the inability of the buyer to obtain satisfaction otherwise, such as the case with custom cabinets, specific performance would be an appropriate remedy.
