Q&A Hero

Q: Define "course of dealing" and "course of performance" and how these concepts affect the perfect tender rule.

Q: Set forth what the UCC requires in the way of good faith and the duty imposed on nonmerchants and merchants in regard to fair dealing.

Q: List the exceptions to title warranties.

Q: What needs to be shown under the UCC for goods to be found merchantable?

Q: Discuss when title and risk of loss pass to the buyer in a goods-in-bailment contract when (a) the seller has a negotiable document of title (b) the seller has a nonnegotiable document of title and (c) the seller has a contract or other instrument showing ownership that is not a negotiable or nonnegotiable document of title.

Q: What groups are considered "merchants" under the UCC, and what is the assumption under the UCC in regard to merchants as compared to ordinary buyers and sellers?

Q: Should the perfect tender rule be rejected and replaced with a concept of substantial performance?

Q: List what is required in order for an offer to be considered a firm offer under the UCC. Also discuss the effect if a firm offer is silent as to time and compare that with the result of silence as to time under the common law. Under the UCC offers made by merchants are considered firm offers if the offer (1) is made in writing and (2) gives assurances that it will be irrevocable for up to three months despite a lack of consideration for the irrevocability. If a firm offer is silent as to time, the UCC assumes a three-month irrevocability period. The UCC contrasts with the common law, under which an offer is revocable at any time prior to acceptance unless a period of irrevocability is supported by some kind of consideration.

Q: List and describe the three types of title.

Q: Set forth the five situations under which a buyer gets only voidable title in a sale.

Q: Belinda purchases a couch from Good Furniture Store. She pays for the couch, and the store agrees to deliver it. Unfortunately, on the way to her house, the vehicle overheats and burns, destroying the truck and the couch inside. Belinda asks for a refund or another couch. The storeowner refuses on the basis that risk of loss had passed to Belinda. Who will win the dispute and why? What would have happened if Belinda had purchased the couch at a yard sale, and the loss occurred while the seller was delivering it?

Q: Patty, who lives in East Tennessee, developed a new type of printer that required very little ink. As a merchant, she entered into contracts to sell the printer to a number of merchants of office supplies in the East Tennessee area for a charge of $600 each. She further entered into a number of contracts with merchants in other states and also in foreign countries. For printers sold in states other than Tennessee and for printers sold outside the U.S., she charged $1,001 each. Patty was a trusting soul who did not require that her arrangements be in writing because she believed that a person's word was his or her bond. She did, however, send a confirming memo to each client to which she received no objections. Patty manufactured a number of printers; but unfortunately, due to a downturn in the economy, a number of her buyers refused to proceed on their contracts, with several claiming that the contracts were unenforceable because they were not in writing. Which of the following is true regarding whether the contracts with clients in the East Tennessee area were required to be in writing? A. Because the contracts were for amounts priced at $500 or more, they were required to be in writing and signed by the buyer. B. Because the printers were sold in Patty's home state, no writing was required. C. Because the contracts were for amounts priced at $1,000 or more, they were required to be in writing and signed by the buyer. D. Because the contracts were for amounts priced at $500 or more, they were required to be in writing; but Patty's memo was sufficient to satisfy the requirement. E. Because the contracts were for amounts priced at $1,000 or more, they were required to be in writing and signed by the buyer; but Patty's memo was sufficient to satisfy the requirement.

Q: Patty, who lives in East Tennessee, developed a new type of printer that required very little ink. As a merchant, she entered into contracts to sell the printer to a number of merchants of office supplies in the East Tennessee area for a charge of $600 each. She further entered into a number of contracts with merchants in other states and also in foreign countries. For printers sold in states other than Tennessee and for printers sold outside the U.S., she charged $1,001 each. Patty was a trusting soul who did not require that her arrangements be in writing because she believed that a person's word was his or her bond. She did, however, send a confirming memo to each client to which she received no objections. Patty manufactured a number of printers; but unfortunately, due to a downturn in the economy, a number of her buyers refused to proceed on their contracts, with several claiming that the contracts were unenforceable because they were not in writing. Which of the following is true regarding whether the contracts with clients in the U.S. outside of Tennessee were required to be in writing? A. Because the contracts were for amounts priced at $500 or more, they were required to be in writing and signed by the buyer. B. Because the printers were sold outside Patty's home state, no writing was required. C. Because the contracts were for amounts priced at $1,000 or more, they were required to be in writing and signed by the buyer. D. Because the contracts were for amounts priced at $500 or more, they were required to be in writing; but Patty's memo was sufficient to satisfy the requirement. E. Because the contracts were for amounts priced at $1,000 or more, they were required to be in writing and signed by the buyer; but Patty's memo was sufficient to satisfy the requirement.

Q: Patty, who lives in East Tennessee, developed a new type of printer that required very little ink. As a merchant, she entered into contracts to sell the printer to a number of merchants of office supplies in the East Tennessee area for a charge of $600 each. She further entered into a number of contracts with merchants in other states and also in foreign countries. For printers sold in states other than Tennessee and for printers sold outside the U.S., she charged $1,001 each. Patty was a trusting soul who did not require that her arrangements be in writing because she believed that a person's word was his or her bond. She did, however, send a confirming memo to each client to which she received no objections. Patty manufactured a number of printers; but unfortunately, due to a downturn in the economy, a number of her buyers refused to proceed on their contracts, with several claiming that the contracts were unenforceable because they were not in writing. Assuming the Contract for the International Sale of Goods is in effect, which of the following is true regarding whether the contracts with clients outside the U.S. were required to be in writing? A. Because the contracts were for amounts priced at $500 or more, they were required to be in writing and signed by the buyer. B. Assuming credible and reasonable proof of any contract at issue, because the Contract for the International Sale of Goods applied, no writing was required. C. Because the contracts were for amounts priced at $1,000 or more, they were required to be in writing and signed by the buyer. D. Because the contracts were for amounts priced at $500 or more, they were required to be in writing; but Patty's memo was sufficient to satisfy the requirement. E. Because the contracts were for amounts priced at $1,000 or more, they were required to be in writing and signed by the buyer; but Patty's memo was sufficient to satisfy the requirement.

Q: Wrecked Furniture. Ralph buys new furniture for his living room from Good Times Furniture. It is agreed that the goods will be placed with a common carrier for delivery. The contract between Ralph and Good Times is ambiguous regarding whether the seller had the duty to deliver the goods only to the common carrier's hands or whether the seller had the duty to deliver the goods to Ralph's home. Unfortunately, on the way to Ralph's home, through no fault of the delivery driver, the delivery truck got wrecked and the furniture was significantly damaged. Which of the following is a type of contract that Ralph and Good Times Furniture entered into? A. A common-carrier delivery contract B. A trucking contract C. A goods-in-bailment contract D. A conditional sales contract E. A conditional delivery contract

Q: Wrecked Furniture. Ralph buys new furniture for his living room from Good Times Furniture. It is agreed that the goods will be placed with a common carrier for delivery. The contract between Ralph and Good Times is ambiguous regarding whether the seller had the duty to deliver the goods only to the common carrier's hands or whether the seller had the duty to deliver the goods to Ralph's home. Unfortunately, on the way to Ralph's home, through no fault of the delivery driver, the delivery truck got wrecked and the furniture was significantly damaged. What type of contract is presumed based upon the fact that the contract was ambiguous regarding whether the seller had the duty to deliver the goods only to the common carrier's hands or whether the seller had the duty to deliver the goods to Ralph's home? A. Transit B. Location C. Destination D. Origin E. Voidable

Q: Wrecked Furniture. Ralph buys new furniture for his living room from Good Times Furniture. It is agreed that the goods will be placed with a common carrier for delivery. The contract between Ralph and Good Times is ambiguous regarding whether the seller had the duty to deliver the goods only to the common carrier's hands or whether the seller had the duty to deliver the goods to Ralph's home. Unfortunately, on the way to Ralph's home, through no fault of the delivery driver, the delivery truck wrecked and the furniture was significantly damaged. Which of the following is true regarding the risk of loss at the time the goods were damaged? A. The risk of loss was with the furniture store. B. The risk of loss was with Ralph. C. The risk of loss was split 50-50 between Ralph and the furniture store. D. The risk of loss was with Ralph only if the driver is determined to be an agent of the furniture store. E. The risk of loss was with the furniture store only if the driver is determined to be an agent of the furniture store.

Q: Accidental Sale. ABC Motors ordinarily deals in used cars and also does some amount of repair work. Robby entrusted his automobile to ABC Motors to have the oil changed and get new brakes. The car was parked in the lot along with other cars, some of which were for sale. The manager of ABC Motors accidentally sold the car to Connie because she saw it and took it upon herself to offer a good price. The manager was attempting to increase the shop's profit margin. Connie had no idea that the car did not belong to ABC Motors. When Robby went to pick up the car, he was very upset that it was gone. The manager told Robby that he was very sorry, but that he was not negligent and only made an honest mistake. According to the manager, Robby accepted the risk of this type of loss; and his only recourse was against Connie. Which of the following is a proper identifying term for Connie? A. A good-faith purchaser B. A valid purchaser C. A void purchaser D. A voidable purchaser E. An interested purchaser for value

Q: Accidental Sale. ABC Motors ordinarily deals in used cars and also does some amount of repair work. Robby entrusted his automobile to ABC Motors to have the oil changed and get new brakes. The car was parked in the lot along with other cars, some of which were for sale. The manager of ABC Motors accidentally sold the car to Connie because she saw it and took it upon herself to offer a good price. The manager was attempting to increase the shop's profit margin. Connie had no idea that the car did not belong to ABC Motors. When Robby went to pick up the car, he was very upset that it was gone. The manager told Robby that he was very sorry, but that he was not negligent and only made an honest mistake. According to the manager, Robby accepted the risk of this type of loss; and his only recourse was against Connie. Which of the following is true regarding the manager's statement that Robby's only recourse is against Connie? A. The manager is correct. B. The manager is incorrect only if Robby has a writing signed by a representative of the repair shop guaranteeing the safety of the car. C. Because the sale to Connie was an accident, the manager is correct only if Connie can be found and served with process. D. The manager is correct only if Connie's deal was for less than 10% of the fair market value of the car. E. The manager is incorrect.

Q: Accidental Sale. ABC Motors ordinarily deals in used cars and also does some amount of repair work. Robby entrusted his automobile to ABC Motors to have the oil changed and get new brakes. The car was parked in the lot along with other cars, some of which were for sale. The manager of ABC Motors accidentally sold the car to Connie because she saw it and took it upon herself to offer a good price. The manager was attempting to increase the shop's profit margin. Connie had no idea that the car did not belong to ABC Motors. When Robby went to pick up the car, he was very upset that it was gone. The manager told Robby that he was very sorry, but that he was not negligent and only made an honest mistake. According to the manager, Robby accepted the risk of this type of loss; and his only recourse was against Connie. Which of the following is true regarding Connie's rights to the car? A. Connie can keep the car only if the repair shop voluntarily agrees to pay Robby the fair market value of the car. B. Connie can keep the car without paying any additional amounts only because she paid cash for it. C. Connie can keep the car without paying any additional amounts, and whether or not she paid cash makes no difference. D. Connie must give the car to Robby. E. Connie must return the car to the repair shop.

Q: Used Car Problems. Marcy purchased a used car from ABC Motors. Six months later the police seized the car from Marcy on the basis that it was a stolen vehicle. Marcy asked for her money back from ABC Motors. The manager there told her that the car was not stolen; that even if it were stolen, ABC Motors acted in good faith with no knowledge of a theft; and that, therefore, no refund was legally required. ABC Motors had also sold a used car to Frank who wrote a bad check for the car and left town but not before he sold the car to Betty who paid $1,100, a fair price for the car, believing that Frank had all rights to sell it. ABC Motors asked Betty to return the car, but she told ABC to forget it. Assuming that ABC Motors was an innocent purchaser from the thief, which of the following is true regarding Betty's obligations, if any? A. She is not required to return the car because Frank held voidable title, not void title. B. She is not required to return the car under the UCC because she paid over $1,000 for it. C. She is required to return the title because Frank held voidable title, not void title. D. She is required to return the title under the UCC because she paid under $5,000 for it. E. Under the UCC, the car should be sold with ABC and Betty splitting the proceeds.

Q: Used Car Problems. Marcy purchased a used car from ABC Motors. Six months later the police seized the car from Marcy on the basis that it was a stolen vehicle. Marcy asked for her money back from ABC Motors. The manager there told her that the car was not stolen; that even if it were stolen, ABC Motors acted in good faith with no knowledge of a theft; and that, therefore, no refund was legally required. ABC Motors had also sold a used car to Frank who wrote a bad check for the car and left town but not before he sold the car to Betty who paid a fair price for the car believing that Frank had all rights to sell it. ABC Motors asked Betty to return the car, but she told ABC to forget it. Assuming that the thief who stole the car sold and delivered it to ABC Motors without the knowledge of any representative of ABC Motors of the theft, what kind of title did ABC Motors have? A. Void B. Valid C. Voidable so long as ABC Motors can prove that it had never been charged with dealing in stolen merchandise D. Voidable so long as ABC Motors can prove that none of its representatives were negligent in disregarding evidence of the theft at any time prior to its resale to Marcy E. Voidable so long as no manager of ABC Motors had made an affirmative representation that the car was not stolen

Q: Used Car Problems. Marcy purchased a used car from ABC Motors. Six months later the police seized the car from Marcy on the basis that it was a stolen vehicle. Marcy asked for her money back from ABC Motors. The manager there told her that the car was not stolen; that even if it were stolen, ABC Motors acted in good faith with no knowledge of a theft; and that, therefore, no refund was legally required. ABC Motors had also sold a used car to Frank who wrote a bad check for the car and left town but not before he sold the car to Betty who paid a fair price for the car believing that Frank had all rights to sell it. ABC Motors asked Betty to return the car, but she told ABC to forget it. Assuming that ABC Motors was an innocent purchaser from the thief, which of the following is true regarding the manager's statement that Marcy is not due a refund? A. The manager is correct only so long as ABC Motors can prove that it had never been charged with dealing in stolen merchandise. B. The manager is correct only so long as ABC Motors can prove that none of its representatives were negligent in disregarding evidence of the theft at any time prior to its resale to Marcy. C. The manager is correct. D. The manager is incorrect only if Marcy can prove that she specifically asked if there was any problem with the car prior to her purchase and was affirmatively told that the title was good. E. The manager is incorrect.

Q: Used Car Problems. Marcy purchased a used car from ABC Motors. Six months later the police seized the car from Marcy on the basis that it was a stolen vehicle. Marcy asked for her money back from ABC Motors. The manager there told her that the car was not stolen; that even if it were stolen, ABC Motors acted in good faith with no knowledge of a theft; and that, therefore, no refund was legally required. ABC Motors had also sold a used car to Frank who wrote a bad check for the car and left town but not before he sold the car to Betty who paid $1,100, a fair price for the car, believing that Frank had all rights to sell it. ABC Motors asked Betty to return the car, but she told ABC to forget it. What kind of title did Frank have? A. Valid B. Void C. Voidable D. Absolute E. Illegal

Q: Carpet Woes. Beau went shopping at ABC Carpet. He saw some carpet he liked but could not make up his mind. The manager at ABC Carpet wrote down the proposed purchase price for him along with a statement that the price would be good for three months. Two months later Beau went back to ABC Carpet to purchase the carpet. Unfortunately, the price had gone up. Beau showed the manager his writing and guaranteed price, but the manager said that the offer was no longer good. Although he had to pay more than the ABC manager had initially promised, Beau proceeded to purchase his carpet from ABC Carpet, and he also contracted with ABC to do the installation. Unfortunately, Beau almost immediately started to have problems with the carpet. Beau told the sales manager of ABC Carpet that he was planning on bringing suit for breach of warranty. The sales manager, however, told him that the breach of warranty provisions only applied to sales of goods and that the carpet purchase was for installation, a service. What kind of offer did the manager at ABC Carpet make to Beau? A. An unenforceable offer B. A firm offer C. A consideration offer D. An illusory offer E. A mirror offer

Q: Carpet Woes. Beau went shopping at ABC Carpet. He saw some carpet he liked but could not make up his mind. The manager at ABC Carpet wrote down the proposed purchase price for him along with a statement that the price would be good for three months. Two months later Beau went back to ABC Carpet to purchase the carpet. Unfortunately, the price had gone up. Beau showed the manager his writing and guaranteed price, but the manager said that the offer was no longer good. Although he had to pay more than the ABC manager had initially promised, Beau proceeded to purchase his carpet from ABC Carpet, and he also contracted with ABC to do the installation. Unfortunately, Beau almost immediately started to have problems with the carpet. Beau told the sales manager of ABC Carpet that he was planning on bringing suit for breach of warranty. The sales manager, however, told him that the breach of warranty provisions only applied to sales of goods and that the carpet purchase was for installation, a service. Which of the following is true regarding the enforceability of the offer made by the manager at ABC Carpet? A. ABC Carpet is not bound by the offer because Beau did not provide any consideration. B. ABC Carpet is bound by the offer, but only for a period of seven days. C. ABC Carpet is bound by the offer, but only for a period of ten days. D. ABC Carpet is not bound by the offer both because Beau did not provide any consideration and also because such an offer is only good for a period of ten days. E. ABC Carpet was bound by the offer and Beau had the right to sue for the refusal to honor the agreement.

Q: Carpet Woes. Beau went shopping at ABC Carpet. He saw some carpet he liked but could not make up his mind. The manager at ABC Carpet wrote down the proposed purchase price for him along with a statement that the price would be good for three months. Two months later Beau went back to ABC Carpet to purchase the carpet. Unfortunately, the price had gone up. Beau showed the manager his writing and guaranteed price, but the manager said that the offer was no longer good. Although he had to pay more than the ABC manager had initially promised, Beau proceeded to purchase his carpet from ABC Carpet, and he also contracted with ABC to do the installation. Unfortunately, Beau almost immediately started to have problems with the carpet. Beau told the sales manager of ABC Carpet that he was planning on bringing suit for breach of warranty. The sales manager, however, told him that the breach of warranty provisions only applied to sales of goods and that the carpet purchase was for installation, a service. Which of the following is true regarding whether the UCC applies to the contract Beau had with ABC Carpet? A. Common law will be applied, not the UCC, because the contract was mixed. B. The UCC will be applied, not common law because the contract was mixed. C. The court will determine whether the predominant purpose of the contract was the sale of goods in which case the UCC would apply. D. The court will apply the service-warranty test to determine whether the predominant purpose of the contract was the provision of a service in which case the UCC would apply. E. The court will apply the service-warranty test to determine whether the predominant purpose of the contract was the sale of goods in which case the UCC would apply.

Q: Which of the following are types of conditional sales contract? A. Sale-on-approval contracts B. Sale-or-return contracts C. Condition-on-sale contracts D. Sale-on-approval contracts, sale-or-return contracts, and condition-on-sale contracts E. Sale-on-approval contracts and sale-or-return contracts, but not condition-on-sale contracts

Q: In a conditional sales contract, a contract is a _____ if the seller allows the buyer to take possession of the goods before deciding whether to complete the contract by making the purchase. A. sale-on-approval contract B. sale-or-return contract C. condition-or-sale contract D. return-or-purchase E. return-or-sale

Q: In a conditional sales contract, a _____ occurs when the seller and buyer agree that the buyer may return the goods at a later time. A. sale-on-approval contract B. sale-or-return contract C. condition-or-sale contract D. return-or-purchase E. return-or-sale

Q: What may a buyer do if a seller does not provide goods that were described in the contract? A. Accept the nonconforming goods as is B. Reject the goods subject to the seller's curing the deficiency in the goods C. Reject the goods if no cure is possible D. Accept the nonconforming goods as is, reject the goods subject to the seller's curing the deficiency in the goods, or reject the goods if no cure is possible E. Nothing for at least 30 days

Q: What do the words "deliver to the order of seller" indicate in a goods-in-bailment contract? A. A negotiable document B. A nonnegotiable document C. A shipment contract D. An origin contract E. An execution contract

Q: A goods-in-bailment contract that lacks the words "to the order of" indicates a(n) _____ document. A. negotiable B. nonnegotiable C. shipment contract D. origin contract E. sale-or-return contract

Q: In a goods-in-bailment contract, when is an insurable interest created? A. When either party has title to the goods B. When either party has title or a risk of loss C. When either party has title, risk of loss, or other economic interest attached to the goods D. Two days after either party has title to the goods E. Never, there is no such thing as a goods-in-bailment contract

Q: What type of contract references goods that are in some kind of storage so the seller cannot transfer physical possession of them? A. Goods-in-transit B. Goods-in-bailment C. General to contract D. Stored pending payment E. Stored-in-transit

Q: Which of the following does a seller have in order to indicate ownership of goods when goods are in some kind of storage so the seller cannot transfer physical possession of them? A. A negotiable document of title. B. A nonnegotiable document of title. C. A contract or other instrument showing ownership that is not a negotiable or nonnegotiable document of title. D. Either a negotiable document of title, a nonnegotiable document of title, or a contract or other instrument showing ownership that is not a negotiable or nonnegotiable document of title. E. A negotiable document or a nonnegotiable document of title only.

Q: Which of the following occurs in a CIF agreement? A. Risk of loss occurs when goods are identified to the contract. B. Risk of loss occurs when the goods are delivered to the buyer. C. Risk of loss remains with the seller for 5 days after the sale. D. Risk of loss remains with the seller for 5 days before the sale. E. The seller puts the goods in possession of a carrier before the risk passes to the buyer.

Q: Which of the following is true regarding transportation costs when the designation FOB is used? A. The selling price includes transportation costs. B. The selling price does not include transportation costs. C. Both the buyer and seller bear transportation costs with the costs apportioned at a rate of 50% to the buyer and 50% to the seller. D. Both the buyer and seller bear transportation costs with the loss being proportioned 75% to the buyer and 25% to the seller. E. Both the buyer and seller bear transportation costs with the loss being proportioned 25% to the buyer and 75% to the seller.

Q: What does the term "FAS" when used as a shipping term represent? A. Fee at ship B. Fee along shore C. Freedom alongside D. Free alongside E. Free of basis

Q: Which of the following is true when the designation FAS is used? A. The buyer, at the buyer's expense, delivers the goods alongside the ship before the risk passes to the buyer. B. The buyer, at the seller's expense, delivers the goods alongside the ship before the risk passes to the buyer. C. The seller, at the seller's expense, delivers the goods alongside the ship before the risk passes to the buyer. D. The seller, at the buyer's expense, delivers the goods alongside the ship before the risk passes to the buyer. E. The common carrier, at the carrier's expense, delivers the goods alongside the ship before the risk passes to the buyer.

Q: What does CIF stand for when used as a shipping term represent? A. Cost, insurance, and freight B. Collateral, insurance, and freight C. Commerce, insurance, and freight D. Cost, indemnity, and freight E. Cost, insurance, and flight

Q: In an origin contract who bears the risk of loss while the goods are in transit? A. The seller B. The buyer C. Both the buyer and seller with the loss being proportioned 50% to the buyer and 50% to the seller D. Both the buyer and seller with the loss being proportioned 75% to the buyer and 25% to the seller E. Both the buyer and seller with the loss being proportioned 25% to the buyer and 75% to the seller

Q: In a destination contract who bears the risk of loss while the goods are in transit? A. The seller B. The buyer C. Both the buyer and seller with the loss being proportioned 50% to the buyer and 50% to the seller D. Both the buyer and seller with the loss being proportioned 75% to the buyer and 25% to the seller E. Both the buyer and seller with the loss being proportioned 25% to the buyer and 75% to the seller

Q: What does "FOB" stand for when used as a shipping term represent? A. Fee on board B. Fee on basis C. Freedom of board D. Free on board E. Free of basis

Q: Which of the following are types of common-carrier delivery contracts? A. Origin, and transfer contracts B. Destination and transfer contracts C. Transfer and simple delivery contracts D. Origin, destination, and transfer contracts E. Origin and destination contracts

Q: Which of the following requires that the seller make proper shipping arrangements and deliver goods to the buyer via a common carrier but not require a guarantee of the safety of goods to their destination? A. Origin contracts B. Destination contracts C. Transfer contracts D. Origin contracts, destination contracts, and transfer contracts E. Shipment and destination contracts, but not transfer contracts

Q: In an origin contract, when does title pass to the buyer? A. When money is transferred to the seller B. When the items are delivered to the buyer C. At the time and place of shipment D. One day after goods are identified to the contract E. When goods are identified to the contract

Q: When is an insurable interest in the buyer created in a simple delivery contract? A. When money is transferred B. When the items are delivered C. When the buyer takes possession D. When the goods are identified to the contract E. When the goods are tendered for delivery

Q: With a simple delivery contract in which the seller is a merchant, which party sustains a loss if, through no fault of either party, the goods are destroyed through fire prior to delivery? A. The seller B. The buyer C. Both the buyer and seller with the loss being proportioned 50% to the buyer and 50% to the seller D. Both the buyer and seller with the loss being proportioned 75% to the buyer and 25% to the seller E. Both the buyer and seller with the loss being proportioned 25% to the buyer and 75% to the seller

Q: With a simple delivery contract in which the seller is not a merchant, which party sustains a loss if, through no fault of either party, the goods are destroyed through fire prior to delivery? A. The seller if tender of delivery has occurred B. The buyer if tender of delivery has occurred C. Both the buyer and seller with the loss being proportioned 50% to the buyer and 50% to the seller D. Both the buyer and seller with the loss being proportioned 75% to the buyer and 25% to the seller E. Both the buyer and seller with the loss being proportioned 25% to the buyer and 75% to the seller

Q: If a buyer and seller execute a contract and the seller subsequently places the goods with a common carrier for delivery to the buyer, which of the following is true regarding the statue of the common carrier? A. The common carrier is the agent of the seller. B. The common carrier is the agent of the buyer. C. The common carrier is the agent of both the seller and the buyer. D. The common carrier is a fiduciary. E. The common carrier is an independent contractor.

Q: With a simple delivery contract involving goods sold by a merchant that are to be delivered, when does risk of loss transfer to the buyer? A. When money is transferred B. When the items are tendered C. When goods are delivered to the buyer D. One day after goods are identified to the contract E. When goods are identified to the contract

Q: What type of agreement do the parties have when the sale itself is contingent on approval? A. A transferable contract B. An unapproved contract C. An average delivery contract D. A conditional sales contract E. A goods-in-transfer contract

Q: When does title transfer to the buyer with a simple delivery contract? A. When money is transferred B. When the items are delivered C. When the buyer takes possession D. One day after goods are identified to the contract E. When goods are identified to the contract

Q: Which of the following occurs when the purchased goods are transferred to the buyer from the seller at either the time of the sale or some time later by the seller's delivery? A. A voidable delivery contract B. An average delivery contract C. A simple delivery contract D. A complex delivery contract E. An acknowledged sale

Q: What type of agreement do the parties have when the goods are delivered to a buyer via a common carrier, such as a trucking line? A. A simple delivery contract B. A common-carrier delivery contract C. A goods-in-bailment contract D. An average delivery contract E. A delivery-carrier contract

Q: What type of agreement do the parties have when the purchased goods are in some kind of storage under the control of a third party, such as a warehouseman? A. A goods-in-bailment contract B. A simple delivery contract C. An average delivery contract D. A conditional sales contract E. A goods-in-transfer contract

Q: Which of the following is not a true title? A. Void title B. Voidable title C. Good title D. Examined title E. Substantiated title

Q: If a contract between the original parties would be void but the goods have already been sold to a third party, it would be considered _____ title. A. releasable B. voidable C. good D. substantiated E. excised

Q: Which of the following is true if an owner entrusts the possession of goods to a merchant who deals in goods of that kind? A. The merchant can transfer all rights in the goods to a buyer in the ordinary course of business. B. The merchant can only transfer voidable title until any funds in the possession of the merchant are transferred to the owner. C. The merchant can only transfer void title until the owner approves the sale. D. The merchant can only transfer temporary title until any funds in the possession of the merchant are transferred to the owner. E. The merchant must have any purchaser sign a document acknowledging that the purchaser will return the goods upon the request of the owner.

Q: What type of interest occurs when there is a right to insure goods against any risk exposure such as damage or destruction? A. An insurable interest B. A compensable interest C. A paid interest D. A collateral interest E. A valid interest

Q: Under the UCC, if a contract or a contract provision is so unfair that a court would be unreasonable if it enforced the agreement, the contract is deemed _____. A. unconscionable B. unreasonable C. voidable D. viable E. ancillary

Q: What actions does the UCC provide that a court can take if it discovers that a contract or lease provision is unconscionable? A. The court must refer the matter to mediation. B. The court must refer the matter to arbitration. C. The court can only refuse to enforce the parts of the contract or lease that are unfair. D. The court either can refuse to enforce the contract or lease, or can enforce the parts of the contract or lease that are fair. E. The court has no power to enforce the lease and must award the innocent party punitive damages.

Q: Which of the following is treaty that provides a legal structure for international sales? A. The International Convention of Contracts for International Sales B. The Federation Convention on the Uniform Commercial Code C. The Worldwide Federation Convention on the Sale of Goods D. The United Nations Convention on Contracts for the International Sale of Goods E. The International Agreement on the Sale of Goods

Q: Which of the following is true regarding the mirror-image rule and the UCC? A. The mirror-image rule applies under the UCC the same as it is applies under common law. B. The mirror-image rule that applies under common law does not apply under the UCC. C. The mirror-image rule that applies under the common law applies under the UCC only if a lease is involved. D. The mirror-image rule that applies under the common law applies under the UCC only if a sale of goods is involved. E. The mirror-image rule under the UCC does not apply to common law.

Q: Under the UCC, contracts for the sale of goods must be in writing in order to be enforceable if they are valued at _____ or more. A. $100 B. $500 C. $1,000 D. $1,500 E. $5,000

Q: Under the UCC, lease contracts that require payments of _____ or more must be in writing in order to be enforceable. A. $100 B. $500 C. $1,000 D. $1,500 E. $5,000

Q: Under the UCC, when is an acceptance effective? A. When dispatched B. When received C. When received only if acceptance by electronic means is made, otherwise on dispatch D. When dispatched only if the U.S. mail is used, otherwise on receipt E. When dispatched only when the telephone is used, otherwise on receipt

Q: The United Nations Convention on Contracts for the International Sale of Goods governs _____. A. business to consumer sales contracts B. business to business sales contracts C. mixed sale contracts D. leases E. all transactions involving the mirror-image rule

Q: A firm offer must be _____. A. oral and indefinitely revocable B. oral and irrevocable for up to one year C. in writing and indefinitely revocable D. in writing and irrevocable for up to three months E. in writing and irrevocable for up to one year

Q: Under the UCC, how may an acceptance be made? A. Only be writing. B. Only orally or by a writing. C. Only by electronic communication or by writing. D. Only by facsimile or by mail. E. By any reasonable means of communication.

Q: Under Article 2(A) of the UCC "a transfer of the right to possession and use of goods for a term in return for consideration" is a _____. A. sale of goods B. lease C. transfer D. rental E. consignment

Q: Under Article 2(A) of the UCC, a person who transfers the right to possession and use of goods under a lease is a(n) _____. A. relater B. seller C. lessee D. lessor E. acquirer

Q: Under Article 2(A) of the UCC, a person who acquires the right to possession and use of goods under a lease is a(n) _____. A. buyer B. seller C. lessee D. lessor E. acquirer

Q: A contract that combines a good with a service is a _____ sale. A. combined B. mixed C. service D. goods E. total

Q: Which is not covered under Article 2(A) of the UCC? A. Real property B. Cars C. Equipment D. Machines E. None of these as they are all covered

Q: What did the court rule on appeal in Alfonso Candela v. Port Motors Inc., the case in the text in which the plaintiff sued the defendant for breach of warranty of title claiming that he was sold a stolen car? A. That the defendant passed good title as long as the defendant did not know that the car was stolen. B. That the defendant passed voidable title as long as the defendant did not know that the car was stolen. C. That a defendant selling stolen goods, regardless of good faith, can never pass a voidable or good title to the buyer. D. That a defendant selling stolen goods can pass good title to a buyer so long as the buyer and seller were innocent and not in collusion. E. That a defendant selling stolen goods does not pass good title but that the risk of loss is on the buyer.

Q: Under the UCC, items are _____ if they exist physically. A. merchandise B. real C. tangible D. movable E. saleable

Q: Which of the following do not meet the UCC definition of a good? A. Real estate B. Corporate stocks C. Copyrights

Q: Which of the following are considered goods under the UCC? A. Minerals taken from real estate and sold by the owner. B. Soil taken from real estate and sold by the owner. C. The right, sold by the owner to another party, to remove soil from real estate. D. Minerals taken from real estate and sold by the owner; soil taken from real estate and sold by the owner; and the right, sold by the owner to another party, to remove soil from real estate. E. Minerals taken from real estate and sold by the owner and soil taken from real estate and sold by the owner; but not the right, sold by the owner to another party, to remove soil from the real estate.