UCC Sales Flashcards
Under common law, a writing, in order to be legally sufficient to satisfy the Statute of Frauds, must identify
the parties, subject matter, the essential terms and the consideration, as well as be signed by the party to be charged
However, under the UCC the writing only has to include the
quantity term and be signed by the party to be charged
Under the theory of strict liability, the plaintiff must establish the following:
(1) the seller was engaged in the business of selling the product, (2) the product was defective, (3) the defect was unreasonably dangerous to the plaintiff, and (4) the defect caused injury to the plaintiff.
under the UCC, in the case of a sale or return contract, risk of loss and title
pass to the buyer according to the shipping terms of the contract. Thus, generally the risk of loss and ownership will be with the buyer while the goods are in the buyer’s possession
Voidable title
One who purchases in good faith from another who has voidable title takes good title
- Good faith—purchaser unaware of facts that made previous title voidable
- One may obtain voidable title by purchasing with a check that is later dishonored
Sales Article of the UCC applies to
the sale of goods. Although certain provisions apply only to transactions between merchants, the general scope of the Article extends to sales between nonmerchants as well
In general, the UCC Sales Article applies to the sale of
Consumer goods by a nonmerchant
In deciding a controversy involving the question of who has the risk of loss, the court will look primarily to
The intent of the parties manifested in the contract.
When the agreed manner of delivery of goods becomes commercially impracticable through no fault of either party,
a commercially reasonable substituted performance by the seller must be accepted by the buyer.
Warranty of fitness for a particular purpose
reated when the seller knows of the particular use for which the goods are required and further knows that the buyer is relying on skill and judgment of seller to select and furnish suitable goods for this particular use
- Buyer must actually rely on seller’s skill and judgment
- Product is then warranted for the particular expressed purpose and seller may be liable if the product fails to so perform
any seller, not only a merchant seller, may create an express warranty by making any affirmation of fact or promise which forms part of the basis of the bargain
Such a warranty may be made either orally or in writing and will exist regardless of the seller’s intent
in order for a firm offer to be effective
it must be contained in writing signed by a merchant offeror.
An oral agreement concerning the sale of goods entered without consideration is binding if the agreement
Modifies the price in an existing, enforceable contract from $525 to $475.
Provided there is no agreement to the contrary and neither party is in breach, the shipping terms
will determine which party bears the risk of loss in this situation. Since the shipping terms were FOB Wizard Suppliers (shipping point), the risk of loss passed to Lazur once the goods were delivered to the carrier.
Examples in which there is voidable title
(1) Goods paid for with a check subsequently dishonored
(2) Goods obtained by fraud, mistake, duress, or undue influence
(3) Goods obtained from minor
(4) Thief does not have voidable title but void title
A seller who discovers that an insolvent buyer has received goods on credit may
reclaim the goods by making a demand for their return within 10 days after receipt of the goods by the buyer
This 10-day limitation, however, does not apply if
he buyer made a written misrepresentation of its solvency within 3 months prior to its receipt of the goods.
When a buyer breaches the contract as it becomes due, the seller may recover
the full purchase price of the goods identified to the contract plus incidental damages if the seller is unable to resell the goods at a reasonable price after making a reasonable effort
Anticipatory breach (anticipatory repudiation)
takes place when party indicates that s/he will not be performing contract and performance is not yet due
Seller has right to cure nonconformity (i.e., tender conforming goods)
(1) Within original time of contract, or
(2) Within reasonable time if seller thought nonconforming tender would be acceptable
(3) Seller must notify buyer of his intention to cure
If goods are held in warehouse and seller has no right to move them, risk of loss passes to buyer
(1) Upon proper negotiation of a negotiable document of title
(2) Within a reasonable time after delivery of a nonnegotiable document of title
(3) Once warehouseman acknowledges buyer’s right to goods if no document of title
If seller learns that buyer is insolvent and buyer does not have the document of title
seller may stop delivery of goods in carrier’s possession unless buyer pays cash
If a contract for the sale of goods includes a C&F shipping term and the seller has fulfilled all of its obligations, the
Risk of loss will pass to the buyer upon delivery of the goods to the carrier
