UCC

Question 1

UCC 1-303: Course of Performance, Course of Dealing and Usage of Trade

Answer 1

a. A course of performance is a sequence of conduct between the parties to a particular transaction that exists if:
(1) the agreement of the parties involves repeated occasions for performance by a party
(2) the other party after the opportunity to reject it, accepts it without objection
b. Course of dealing- a sequence of conduct concerning previous transactions between the parties
c. Usage of trade- any practice or method of dealing having such regularity of observance in place, vocation, or trade as to justify an expectation that it will be observed with respect to the transaction in question (may be used for part performance)
d. Course of performance- with respect to that particular transaction

Question 2

Exceptions in UCC 1-303

Answer 2

1. Express terms prevail over course of performance, course of dealing and usage of trade
2. Course of performance prevails over course of dealing and usage of trade
3. Course of dealing prevails over usage of trade

Question 3

UCC 2-202: Parole Evidence: Final Written Expression

Answer 3

Writings intended by the parties as a Final Written Expression of their agreement, with respect to terms are included and may not be contradicted by evidence of any prior agreement or contemporaneous oral agreement but may be supplemented by

(1) usage of trade, course of performance, course of dealing
(2) consistent additional terms unless the court finds the writing was a complete and exclusive statement of the terms of the agreement

Question 4

UCC 2-208 Course of Performance or Practical Construction

Answer 4

Any course of performance accepted or acquiesced in without objection shall be relevant to determine the meaning of the agreement.

Question 5

UCC 2-209 Modification, Recession and Waiver

Answer 5

(1) An agreement modifying a contract within this article needs no consideration
(2) A signed agreement which excludes modification except by a signed writing cannot otherwise be modified or rescinded except by a form supplied by merchant and signed by other party separately
(3) SOF must be satisfied
(4) Modification can operate as a waiver

Question 6

UCC 2-306 Output requirements and exclusive dealings

Answer 6

A term which measures the quantity of output by the seller must be made in good faith- no quantity unreasonably disproportionate to any stated estimate or normal/comparable output may be tendered or demanded.

Question 7

UCC 2-308 Absence of Specific Place for Delivery

Answer 7

Unless otherwise agreed,

(1) the place for delivery of goods is the sellers place of business or if he has none, his residence, but:
(2) in a contract for the sale of identified goods, if the parties know the goods are in some other place (at the time of contracting) that place is their place for delivery
(3) documents of title may be delivered through customary banking channels

Question 8

UCC 2-312 Buyer’s Obligation Against Infringement

Answer 8

Implied terms:

(1) there is in a contract for sale a warranty by the seller that
(a) the title conveyed shall be good, and its transfer rightful
(b) the goods shall be delivered free from any security interest or other lien or encumbrance of which the buyer, at the time of contracting has knowledge
(2) the only way the warranty under subsection 1 will be excluded or modified is by specific language or circumstances which give the buyer reason to know that the person selling does not claim title in himself

Question 9

UCC 2-312 Express warranties by Affirmation, Promise, Description and Sample

Answer 9

(a) any affirmation or promise made by the seller to the buyer which relates to the goods and becomes part of the basis or the bargain (creates an express warranty that goods shall conform to such affirmation or promise)
(b) Any description of the goods which is made part of the basis of the bargain –> goods shall conform to the description
(c) Any sample or model which is made part of the basis of the bargain

Question 10

UCC 2-314 Implied Warranty: Merchantability; Usage of Trade

Answer 10

Unless otherwise excluded, a warranty that the goods shall be merchantable is implied in the contract, if the seller is a merchant with respect to goods of that kind
Factors to look at:
- Are fit for ordinary purpose for which goods are used
- Pass without objection in the trade under K descrip.
- Of average quality
- Are adequately packaged and labeled
- Conform to promises and affirmations

Question 11

UCC 2-315 Fitness for a particular purpose

Answer 11

Where the seller at the time of contracting has reason to know any particular purpose which the goods are required and the seller is relying on seller’s skill or judgment…(goods fit for ordinary purpose for which goods are normally used and also foreseeable misuse) Legal Consequence: Implied warranty that the goods shall be fit for such purpose

Question 12

UCC 2-316 Exclusion of Modification of Implied (Not Express) Warranties

Answer 12

(1) Words or conduct relevant to the creation of tan express warranty and those actions tending to negate or limit warranty shall be construed wherever reasonable as consistent with each other- subject to PER limitations
(2) Language must mention merchantability and in a case of a writing must be conspicuous and to exclude or modify any implied warranty of fitness, the exclusion must be by a writing and conspicuous
Example: “There are no warranties that extend beyond the description on the face thereof”

Question 13

UCC 2-508 Cure by Seller of Improper Tender or Delivery

Answer 13

(1) If a delivery is rejected because of non-conforming goods and there is still time to perform, the seller can notify the buyer of his intention to cure and make within the contract time make a conforming delivery
(2) If seller delivers goods which he reasonably thought would be conforming, the seller may, if he seasonably notifies the buyer of his intention to cure, have a further reasonable time to substitute conforming tender

Question 14

UCC 2-601 Buyer’s Rights on Improper Delivery

Answer 14

If the goods fail in any respect to conform to the contract, the buyer may:

(a) reject the whole
(b) accept the whole
(c) accept any commercial unit or units and reject the rest

Question 15

UCC 2-602 Manner and Effect of Rightful Rejection

Answer 15

(1) Rejection of goods must be within reasonable time after their delivery or tender. It is ineffective unless the buyer seasonably notifies the seller
(a) After rejection, any exercise of ownership by the buyer is wrongful
(b) If buyer has before rejection taken physical possession of the goods, he is under a duty after rejection to hold them with reasonable care for a reasonable time sufficient to permit seller to remove them
(c) the buyer has no further obligations to goods rightfully rejected

Question 16

UCC 2-609 Right to Adequate Assurance of Performance

Answer 16

A contract for sale imposes an obligation on each party that the other’s expectation of receiving due performance will not be impaired. WHEN REASONABLE GROUNDS FOR INSECURITY ARISE, (regarding performance of either party) they may in writing demand adequate assurance of due performance and until he receives such assurances, suspend his own performance for which he has not already received the agreed return

Question 17

UCC 2-611 Retraction of Anticipatory Repudiation

Repudiation = rejection of proposal or idea

Answer 17

(1) until the repudiating parties next performance is due, he can retract his repudiation unless the other has materially changed his position or indicated that the repudiation is final
(2) Retraction may be any method that clearly indicates to the aggrieved party that the repudiating party intends to perform
(3) Retraction reinstates the repudiating party’s rights under the contract with due excuse and allowance to the aggrieved party for any delay because of the performance

Question 18

UCC 2-613 Casualty to Identified Goods

Answer 18

Where the contract is for identified goods and the goods suffer casualty without fault of either party before the risk of loss passes to the buyer, or in a proper case under a “no arrival, no sale” term, then

(a) the loss is total, the contract is avoided
(b) if the loss is partial the buyer may demand inspection and at his option either treat the contract is avoided or accept the good with due allowance from the contract price but without further right from the seller

Question 19

UCC 2-615 Excuse by failure of Presupposed Conditions

Answer 19

Delay in delivery is not breach. The seller must notify the buyer seasonably that there will be delay or non delivery and when allocation is required (because of destruction of only part of goods) the estimated quota thus made available for the buyer

Question 20

UCC 2-703 Seller’s Remedies in General

Answer 20

Where the buyer wrongfully rejects pr revokes acceptance of goods or fails to make a payment due on or before delivery or repudiates with respect to part or whole, the aggrieved seller may:

(a) withhold delivery of such goods
(b) stop delivery by any bailee as hereafter provided
(c) RESELL AND RECOVER DAMAGES AS HEREAFTER PROVIDED, if re-sold at a loss (but in good faith), can recover damages

Question 21

UCC 2-706 Seller’s Resale Including Contract For Resale

Answer 21

• Basically cover on the sellers side
  The seller may re-sell the goods concerned or the undeliverable balance thereof. Resale price is less than contract price? Can sue for difference

Question 22

UCC 2-708 Seller’s Damages for Non-Acceptance or Repudiation

LOST VOLUME SELLER

Answer 22

The measure of damages for non-acceptance or repudiation by the buyer is the difference between the market price at the time and the place for tender and the unpaid contract price together with any incidental damages provided
(2) If that measure of damages is inadequate to put the seller in as good of position as performance would have done, then the measure is the profit (including reasonable overhead) which the seller would have made from the buyer

Question 23

UCC 2-711 Buyers Remedies, when Seller Breaches

Answer 23

The buyer may cancel if he seller fails to make delivery or repudiates and whether or not he cancels so may in addition to recovering so much of the price as has been paid…

(1) “cover”
(2) recover damages for non-delivery
(3) if the goods have been identified, recover them
(4) in a proper case retain specific performance or replevy the goods

Question 24

UCC 2-713 Buyers Damages for Non-Delivery or Repudiation

Answer 24

The measure of damages for the non-delivery or repudiation by the seller is the difference between market price AT THE TIME WHEN THE BUYER LEARNED OF THE BREACH and the contract price, together with any incidental and consequential damages (market price determined at the place or place of arrival

Question 25

UCC 2-714 Buyers Damages for Breach in Regard to Accepted Goods

Answer 25

Where the buyer has accepted goods and given notification, he may recover as damages for any non-conformity. The measures for damages for breach of warranty is the difference at the time and place of the acceptance between the value of the goods accepted and the value they would have had if they had been as warranted (unless special circumstances)

Question 26

UCC 2-715 Buyers Incidental and Consequential Damages

Answer 26

Incidental Damages include expenses reasonably incurred in inspection, receipt, transportation, care and custody of goods rightfully rejected (any commercially reasonable charges)