Deck 15: Discharge of Contracts

Question 1

Match each of the numbered definitions with the correct term in the following list. Write the letter of your choice in the answer column.
a. bill of sale
b. certificate of title
c. condition subsequent
d. condition precedent
e. estoppel
f. fungible goods
g. order bill of lading
h. personal property
i. real property
j. remote party
k. straight bill of lading
l. warehouse receipt
A common carrier's nonnegotiable receipt for goods accepted for shipment.

Answer 1

Straight Bill of Lading:
In a straight bill of lading, the description states that the goods are to be delivered to a specific party. This type of bill acts as a receipt of goods and is not negotiable. Upon receipt the receiver must surrender the original copy of the order bill of lading to the carrier before the goods will be handed over.
Opinion:
Therefore, the best answer is option k. straight bill of lading.

Question 2

Match each of the numbered definitions with the correct term in the following list. Write the letter of your choice in the answer column.
a. bill of sale
b. certificate of title
c. condition subsequent
d. condition precedent
e. estoppel
f. fungible goods
g. order bill of lading
h. personal property
i. real property
j. remote party
k. straight bill of lading
l. warehouse receipt
A written statement that the seller is passing, or transferring, ownership to a buyer.

Answer 2

Bill of Sale:
A bill of sale is considered to be written documentation of ownership. This type of document passes title from seller to buyer.
Opinion:
Therefore, the best answer is option a. bill of sale.

Question 3

Match each of the numbered definitions with the correct term in the following list. Write the letter of your choice in the answer column.
a. bill of sale
b. certificate of title
c. condition subsequent
d. condition precedent
e. estoppel
f. fungible goods
g. order bill of lading
h. personal property
i. real property
j. remote party
k. straight bill of lading
l. warehouse receipt
A carrier's receipt for goods accepted for shipment that ensures that the goods will not be delivered unless the original bill of lading is surrendered.

Answer 3

Order Bill of Lading:
An order bill of lading is the same as a proof of title. This type of bill acts as a receipt of goods to be shipped to a bearer or party. It is negotiable and may be used to transfer the goods to other parties.
Opinion:
Therefore, the best answer is option g. order bill of lading.

Question 4

Match each of the numbered definitions with the correct term in the following list. Write the letter of your choice in the answer column.
a. bill of sale
b. certificate of title
c. condition subsequent
d. condition precedent
e. estoppel
f. fungible goods
g. order bill of lading
h. personal property
i. real property
j. remote party
k. straight bill of lading
l. warehouse receipt
A provision in a contract that requires the performance of a specific act before title passes.

Question 5

Match each of the numbered definitions with the correct term in the following list. Write the letter of your choice in the answer column.
a. bill of sale
b. certificate of title
c. condition subsequent
d. condition precedent
e. estoppel
f. fungible goods
g. order bill of lading
h. personal property
i. real property
j. remote party
k. straight bill of lading
l. warehouse receipt
A salesperson authorized to sell merchandise for a merchant.

Question 6

Match each of the numbered definitions with the correct term in the following list. Write the letter of your choice in the answer column.
a. bill of sale
b. certificate of title
c. condition subsequent
d. condition precedent
e. estoppel
f. fungible goods
g. order bill of lading
h. personal property
i. real property
j. remote party
k. straight bill of lading
l. warehouse receipt
Land and articles permanently attached to it.

Question 7

Match each of the numbered definitions with the correct term in the following list. Write the letter of your choice in the answer column.
a. bill of sale
b. certificate of title
c. condition subsequent
d. condition precedent
e. estoppel
f. fungible goods
g. order bill of lading
h. personal property
i. real property
j. remote party
k. straight bill of lading
l. warehouse receipt
A provision in a contract that requires the performance of a specific act after title passes.

Question 8

Match each of the numbered definitions with the correct term in the following list. Write the letter of your choice in the answer column.
a. bill of sale
b. certificate of title
c. condition subsequent
d. condition precedent
e. estoppel
f. fungible goods
g. order bill of lading
h. personal property
i. real property
j. remote party
k. straight bill of lading
l. warehouse receipt
A legal bar to the use of contradictory words or acts in asserting a claim against another.

Question 9

Match each of the numbered definitions with the correct term in the following list. Write the letter of your choice in the answer column.
a. bill of sale
b. certificate of title
c. condition subsequent
d. condition precedent
e. estoppel
f. fungible goods
g. order bill of lading
h. personal property
i. real property
j. remote party
k. straight bill of lading
l. warehouse receipt
Goods generally sold by weight or measure, such as grain or gasoline, where each unit is like all others.

Question 10

Match each of the numbered definitions with the correct term in the following list. Write the letter of your choice in the answer column.
a. bill of sale
b. certificate of title
c. condition subsequent
d. condition precedent
e. estoppel
f. fungible goods
g. order bill of lading
h. personal property
i. real property
j. remote party
k. straight bill of lading
l. warehouse receipt
A document that is proof of ownership.

Question 11

Match each of the numbered definitions with the correct term in the following list. Write the letter of your choice in the answer column.
a. bill of sale
b. certificate of title
c. condition subsequent
d. condition precedent
e. estoppel
f. fungible goods
g. order bill of lading
h. personal property
i. real property
j. remote party
k. straight bill of lading
l. warehouse receipt
Possessions other than real property, such as jewelry.

Question 12

Match each of the numbered definitions with the correct term in the following list. Write the letter of your choice in the answer column.
a. bill of sale
b. certificate of title
c. condition subsequent
d. condition precedent
e. estoppel
f. fungible goods
g. order bill of lading
h. personal property
i. real property
j. remote party
k. straight bill of lading
l. warehouse receipt
Evidence of ownership provided by a storage facility.

Question 13

Indicate whether each of the following statements is true or false by writing T or F in the answer column.
A bill of sale must be prepared on a specific legal form.

Question 14

Indicate whether each of the following statements is true or false by writing T or F in the answer column.
Title is proof of ownership as shown by a bill of sale.

Question 15

Indicate whether each of the following statements is true or false by writing T or F in the answer column.
Personal property is land and anything attached to it.

Question 16

Indicate whether each of the following statements is true or false by writing T or F in the answer column.
A straight bill of lading is an instrument used to collect money owed.

Question 17

Indicate whether each of the following statements is true or false by writing T or F in the answer column.
The general rule of law regarding the passing of title is that title passes when the parties intend it to pass.

Question 18

Indicate whether each of the following statements is true or false by writing T or F in the answer column.
A handwritten bill of sale may be an effective legal document.

Question 19

Indicate whether each of the following statements is true or false by writing T or F in the answer column.
Estoppel is a legal principle that can prevent an owner from recovering his or her own property under certain circumstances.

Question 20

Indicate whether each of the following statements is true or false by writing T or F in the answer column.
An airbill is similar to a bill of lading except that it covers a shipment made by air.

Question 21

Indicate whether each of the following statements is true or false by writing T or F in the answer column.
Conditions precedent are required acts that must be performed before title passes.

Question 22

Indicate whether each of the following statements is true or false by writing T or F in the answer column.
A person who finds an article has good title against anyone else except the true owner.

Question 23

Indicate whether each of the following statements is true or false by writing T or F in the answer column.
The owner of cash who entrusts it to another cannot demand the return of the money from a third party to whom the money was given in exchange for something of value.

Question 24

Indicate whether each of the following statements is true or false by writing T or F in the answer column.
Title to goods can never pass to another without the consent of the owner.

Question 25

Indicate whether each of the following statements is true or false by writing T or F in the answer column.
Conditions subsequent are required acts that must be performed after a contract is signed.

Question 26

Indicate whether each of the following statements is true or false by writing T or F in the answer column.
Title to fungible goods passes when they are delivered.

Question 27

Indicate whether each of the following statements is true or false by writing T or F in the answer column.
The owner of personal property cannot recover it from an innocent third party who purchased it from a seller in possession of the property and who was entrusted with proof of ownership by the real owner.

Question 28

Answer the following question and discuss them in class.
Distinguish between real and personal property and indicate which is subject to the law of sales.
______________________________________________________
_______________________________________________________

Question 29

Answer the following question and discuss them in class.
Explain how title and certificate of title relate to ownership.
______________________________________________________
_______________________________________________________

Question 30

Answer the following question and discuss them in class.
Explain how title passes and discuss how bills of sale, bills of lading, and warehouse receipts are involved in the passing of title.
______________________________________________________
_______________________________________________________

Question 31

Answer the following question and discuss them in class.
Explain the law governing title to lost or stolen goods and sales by persons having wrongful possession of goods.
______________________________________________________
_______________________________________________________

Question 32

Answer the following question and discuss them in class.
Discuss the principle of estoppel and provide examples of how this principle is applied in various situations.
______________________________________________________
_______________________________________________________

Question 33

Answer the following question and discuss them in class.
Explain the passage of title to fungible goods.
______________________________________________________
_______________________________________________________

Question 34

Answer the following questions, which require you to think critically about the legal principles that you learned in this chapter.
Title An important application of the concept of title relates to who is holding title when a loss occurs. Are there other ways of determining who should bear a loss in a business transaction?
______________________________________________________
_______________________________________________________

Question 35

Answer the following questions, which require you to think critically about the legal principles that you learned in this chapter.
Conditions Precedent A contract stipulates that certain conditions must be met before title can pass. A seller might wish to hasten the passage of title to minimize the risk of loss and the cost of insurance to indemnify such losses. Consider a typical sales transaction and suggest steps a seller might take to accelerate title transfer.
______________________________________________________
_______________________________________________________

Question 36

Answer the following questions, which require you to think critically about the legal principles that you learned in this chapter.
Estoppel It seems that passage of title by estoppel might deny the rights of an innocent though inattentive property owner. Should a legitimate titleholder lose title because of his or her inattention?
______________________________________________________
_______________________________________________________

Question 37

Answer the following questions, which require you to think critically about the legal principles that you learned in this chapter.
Remote Parties How can a buyer in a store know whether he or she is dealing with a titleholder or a remote party? Does it make a difference? Generally, whom does a buyer hold responsible for problems?
______________________________________________________
_______________________________________________________

Question 38

Answer the following questions, which require you to think critically about the legal principles that you learned in this chapter.
A Question of Ethics Is it ethical for a person who is not a titleholder to act as one who has title to goods, thereby misleading a prospective buyer?
______________________________________________________
_______________________________________________________

Question 39

Study each of the following cases. Answer the question that follow by writing Yes or No in the answer column.
Passage of Title Crowley, a building contractor, ordered 500 bags of cement from Litvak Building Supply. It was agreed that Litvak would deliver to a building site and title would pass when delivery was made. Before the bags of cement could be loaded on a delivery truck, a train derailment destroyed much of the supply company's inventory.
a. Must Crowley bear the loss and recover damages from the railroad?
b. Is the requirement of delivery to a building site a condition precedent?
c. Did title to the bags of cement pass at the time the order was placed?

Question 40

Study each of the following cases. Answer the question that follow by writing Yes or No in the answer column.
Estoppel Hollander purchased a computer from a pawnshop for use in his real estate office. Several weeks later, Diem, one of Hollander's customers, mentioned that the computer looked familiar and asked if he could examine it. After checking the underside of the machine, he pointed to his Social Security number, which had been engraved on the metal frame by his insurance agent. Diem demanded the return of the computer, claiming that it had been stolen from him and that he could produce the original sales slip.
a. Can Diem legally recover the computer if he could prove that it had been stolen?
b. Can a rightful owner be estopped from recovering his or her property from an innocent purchaser?
c. Could the pawnshop have given good title to Hollander?

Question 41

Study each of the following cases. Answer the question that follow by writing Yes or No in the answer column.
Condition Precedent Fallon agreed in writing to purchase a used truck from Moonlit Motors with the understanding that a snowplow attachment would be added. When Fallon attempted to take delivery of the truck, he found that the plow attachment had not been added. He refused to accept delivery. Moonlit protested that the plow attachment was being shipped from Minnesota and that it would be installed when it arrived. Moonlit demanded that Fallon accept the truck.
a. Can Fallon legally refuse to accept the truck?
b. Is this an example of a condition precedent?
c. Is the contract enforceable?

Question 42

Study each of the following cases. Answer the question that follow by writing Yes or No in the answer column.
Certificate of Title Forell, a resident of Des Moines, purchased a nearly new Buick automobile from a seller in Cleveland for the unusually low price of $4,000. The seller explained that he was in town to take delivery of another automobile that he had just inherited from his late father. The seller produced a certificate of title. After Forell had possession of the Buick for several months, he sold it to Bates for $3,800. After Bates had driven the car for two months, he was stopped by the police for a minor traffic violation. When the police routinely checked the vehicle identification number through their computer, it was discovered that the car had been stolen from Santiago in Cleveland and that the certificate of title was forged. When Santiago learned that his car had been located, he claimed ownership.
a. Will Santiago be able to recover his automobile?
b. Will the certificate of title Forell obtained from the out-of-town seller entitle him to ownership?
c. Was Forell a good-faith purchaser?

Question 43

Title to Stolen Goods Patterson was on a group vacation tour when he discovered that his camcorder was not where he had left it on the tour bus. Later on the tour, Patterson noticed another vacationer, Carlsen, with a similar camcorder. When Carlsen was confronted, he claimed that he had found the camcorder at one of the tour bus stops. When Patterson produced a bill of sale with a serial number that matched the one on the disputed camcorder, Carlsen refused to surrender it, claiming that since he had found it, it was his. Will Patterson be able to regain possession of his lost camcorder?
Principle of Law:
_______________________________________________________________________________
_______________________________________________________________________________
Decision:
_______________________________________________________________________________
_______________________________________________________________________________

Question 44

Study each of the following cases carefully. Briefly state the principle of law and your decision.
Remote Party Kiang, a sales representative working for Prat's Appliances, sold a refrigerator to Pogany. After several weeks, Pogany changed her mind and wanted to repudiate the sales contract. Her argument was that a valid contract did not exist because Kiang did not possess title to the refrigerator and therefore could not convey title to her. Will Pogany be allowed to repudiate the sales contract?
Principle of Law:
______________________________________________________
_______________________________________________________
Decision:
______________________________________________________
_______________________________________________________

Question 45

Study each of the following cases carefully. Briefly state the principle of law and your decision.
Principle of Law:
______________________________
______________________________
Decision:
______________________________
______________________________

Question 46

Study each of the following cases carefully. Briefly state the principle of law and your decision.
Passage of Title Hughes purchased a new Lincoln Continental automobile from Al Greene, Inc., an authorized new car dealership. On the day of the sale, Hughes made a cash down payment and signed a purchase contract and an application for the title certificate. The understanding was that Hughes would take immediate possession of the car and return in a few days for new-car preparation and the installation of a CB radio. On the way home from the dealer, Hughes wrecked the car. The certificate of title had not yet been issued by the state. The buyer, Hughes, claimed that title had not yet passed since the title certificate had not yet been issued. Who must bear the loss? [ Hughes v. Al Greene, Inc., 418 N.E.2d 1355 (Ohio)]
Principle of Law:
______________________________________________________
_______________________________________________________
Decision:
______________________________________________________
_______________________________________________________

Question 47

Complete the following activities. Share your findings with the class.
Working in Teams In teams of three or four, interview several real estate agents and discuss title and title insurance.
______________________________________________________
_______________________________________________________

Question 48

Complete the following activities. Share your findings with the class.
Using Technology Using the Internet and search engines, find an instrument of title, such as a bill of sale, bill of lading, or warehouse receipt.
______________________________________________________
_______________________________________________________