Question 1

Which of the following is a remedy of the seller under the Sale of Goods Act?

Accepted Answer

Resale is a remedy available to the seller under the Sale of Goods Act when the buyer breaches the contract, allowing the seller to sell the goods to another party.

Question 2

Legislation governing consumer contracts does not ban the use of standard form contracts.Rather,it controls the use of standard form contracts employing various techniques including all of the following EXCEPT

Accepted Answer

The other options listed (A, B, D, and E) are techniques used to control the use of standard form contracts. However, providing the consumer with a statutory right to claim triple damages is not a technique used to control the use of standard form contracts, but rather a potential remedy available to the consumer if they are harmed by a breach of contract or other wrongful conduct by the seller.

Question 3

The Sale of Goods Act deals with the sale of goods by sample and/or description.Which of the following statements is correct?

Accepted Answer

When goods are sold by sample, there is an implied condition that the buyer must have a reasonable opportunity to compare the bulk with the sample to ensure they correspond.

Question 4

International Shippers Corp.wants your advice on the legal implications of international trade.Business has been developing in parts of the Middle East where it's sometimes hard to collect from customers.You advise International Shippers that they should

Accepted Answer

The answer of International Shippers Corp.wants your advice on the...

Question 5

John returned home from work and checked his mailbox to see if anything had been delivered that day.To his surprise,he received a package of magazines from a magazine distributor.John proceeded to open the package and over the course of the next several days,read through the magazines.He then gave them to his dentist for use by patients at the dental office.Approximately thirty days later John received a demand letter from the magazine distributor requesting payment of the magazines which John had not requested.In a subsequent Small Claims action brought by the magazine distributor for payment,the following would likely be the outcome

Accepted Answer

According to the law, if a person receives unsolicited goods, they can use them without becoming liable for their price. Therefore, John would not be liable for payment of the magazines he received from the magazine distributor.

Question 6

If in respect of a contract for the sale of goods there is a breach of warranty,the remedy available pursuant to the Sale of Goods Act is

Accepted Answer

In case of a breach of warranty, the buyer can only claim damages and not repudiate the contract. This is as per Section 53(2) of the Sale of Goods Act, 1930. Option B and C are incorrect as both damages and repudiation or rescission cannot be claimed for a breach of warranty. Option D is also incorrect as repudiation cannot be claimed in case of a breach of warranty. Option E is partially correct as damages can be claimed, but repudiation of contract is not an available remedy.

Question 7

Samuel incorporated a company federally in order to sell fire prevention equipment to consumers across Canada.His lawyers have told him that he can use the same standard form contract across the entire country.However,because each of the provinces have different legislation with respect to consumer contracts,some terms may be valid and enforceable in some provinces and yet void and unenforceable in others.In order to employ the use of a single standard form contract while at the same time protecting his interests,Samuel should

Accepted Answer

By including a term in the contract that allows for any illegal, void, or unenforceable terms to be severed or cut out, Samuel can still use the same standard form contract across the entire country while still complying with each province's legislation. This allows him to protect his interests while also being efficient and consistent in his business practices.

Question 8

Janice purchased a new home and entered into a rental contract for a sprinkler system.There were no services provided by the lawn care company,only the sprinkler system itself which was installed by Janice.One of the sprinkler heads did not function properly and ran continuously after hours.Janice's basement flooded and she sued the company for damages.The contract contained an exemption clause restricting the lawn care company's liability for water damage to $100.Additionally the contract did not include any express term with respect to fitness for purpose.In these circumstances,given that services were not provided by the seller in relation to a consumer contract,Janice would likely

Accepted Answer

Under consumer protection laws, exemption clauses that attempt to limit liability for damages caused by faulty goods or services are generally not enforceable in contracts with consumers. Since Janice entered into a rental contract for the sprinkler system, it is likely that this would be considered a consumer contract. Additionally, since no services were provided by the lawn care company, it is unlikely that the exemption clause would be permitted under sale of goods legislation. Therefore, Janice would likely succeed at trial because the lawn care company cannot escape liability for damages caused by faulty goods or services through an exemption clause.

Question 9

The Carlsons were preparing for a four-day family reunion in their home starting on June 19.On June 15 they ordered a large new dining room table from Levitts Furniture to accommodate the expected relatives.Levitts promised delivery out of their local warehouse three different mornings during the week,but each time they gave feeble reasons why they couldn't do it.On the afternoon of June 18,the Carlsons phoned Levitts,cancelled their order,and demanded their money back.What is the Carlsons' legal remedy?

Accepted Answer

The correct legal remedy for the Carlsons is rescission for breach of condition. Levitts Furniture failed to deliver the dining room table as promised, which constitutes a breach of the sales contract's condition regarding timely delivery. This breach allows the Carlsons to cancel (rescind) the contract and demand a refund.

Question 10

Billy goes to a yard sale and looks for old car stereos.He finds a system that he has been looking for.Billy believes it is worth a lot more money than the $25 the owner is asking for.Billy asks the owner whether or not the system is in good working condition.The owner tells him that he knows nothing about the quality of the tuner and speakers and is not prepared to comment further.Billy purchases the system for $25.Later he finds out that the system is stolen and did not belong to the owner at the time he purchased it.Billy's action for recovery of his money against the owner will

Accepted Answer

The implied term as to title means that the seller must have legal ownership and the right to sell the goods. Since the system was stolen and did not belong to the owner, he breached this implied term and Billy can recover his money. The caveat emptor principle (buyer beware) does not apply in cases of stolen goods. The owner not commenting on the quality of the system is not relevant in this case. The owner offering a reward is not mentioned in the scenario. Billy's discovery of the problem after the sale is also not relevant in this case, as it is clear that the system was stolen and the owner did not have the right to sell it.

Question 11

A sanction intended to compel acceptance upon delivery of goods is called a

Accepted Answer

The answer of A sanction intended to compel acceptance upon...

Question 12

While in the shopping mall,Mabel special ordered a $29.95 DVD from VistaVideo.She was asked to place a $10 deposit on the order because it was "store policy." A little while later,before leaving the mall,Mabel changed her mind about ordering the video because she needed the $10 for something else.VistaVideo refused to return the money.Is Mabel entitled to get the $10 back?

Accepted Answer

A deposit is typically non-refundable as it is a commitment to the purchase, and store policy likely supports this.

Question 13

A seller may include in a standard form contract of sale of goods an express term exempting it from the liability normally imposed by the implied terms.Which of the following statements is correct?

Accepted Answer

If the purchaser is a consumer as defined by consumer protection legislation, the seller cannot "contract out" of the implied terms. This means that even if the seller includes an express term exempting them from liability in a standard form contract, it will not be enforceable if the purchaser is considered a consumer according to consumer protection laws. The purpose of this is to ensure that consumers are adequately protected and not taken advantage of by sellers.

Question 14

In relation to consumer contracts and the protections provided by legislation,a consumer is defined as an individual (not an organization)purchasing a product or service for the following use

Accepted Answer

A consumer is defined as an individual (not an organization) purchasing a product or service for personal, family, household, or non-business use. Therefore, all of the choices (A, B, C, and D) are correct.

Question 15

George goes to his neighbourhood hardware store and asks for a four-foot by eight-foot piece of plywood.He also requests that it be "thick and strong." George purchases the plywood and proceeds to use it as a makeshift bridge on his driveway over a small ditch.The first time he attempts to drive his tractor over the makeshift bridge,the plywood collapses,causing damage to the tractor.George's suit against the hardware store will

Accepted Answer

The hardware store did not breach any implied term of fitness as George did not expressly state the particular purpose for which he intended to use the plywood. Therefore, the hardware store cannot be held liable for the collapse of the makeshift bridge and the damage caused to the tractor.

Question 16

Standard form contracts employed by sellers are carefully regulated by legislation when it comes to the sale of goods or services to consumers.Some businesses attempt to prevent consumers by applying to the court to enforce their rights through class actions.This is done by inserting a term requiring that disputes be resolved by way of arbitration.In essence,the consumer is precluded from participating in any class action.Three provinces,Ontario,Alberta and Quebec,have legislated away this benefit to sellers by

Accepted Answer

Ontario, Alberta, and Quebec have legislated that arbitration clauses in consumer contracts are void and unenforceable, meaning that businesses cannot prevent consumers from participating in class actions.

Question 17

Which of the following is NOT a remedy of the buyer?

Accepted Answer

The action for the price is a remedy available to the seller, not the buyer. The buyer's remedies typically include suing for breach of contract, damages, rescission, or specific performance.

Question 18

Ted goes to his neighborhood hardware store and asks for a six foot by two foot piece of plywood.He also requests that it be "sturdy".Ted purchases the plywood and proceeds to use it as a makeshift bridge for his dog,a 75 pound black lab,to cross over a small ditch in the backyard.The first time his lab attempts to cross the bridge it breaks and the dog falls into the ditch fracturing a bone.Ted's suit against the hardware store for the vet bills will

Accepted Answer

Ted's failure to specify the particular purpose for the plywood means the hardware store could not have known it needed to be strong enough to support the weight of a dog, thus no implied term of fitness for a particular purpose was breached.

Question 19

"The sole warranty between the seller and buyer is the warranty set out in this contract." This written statement is an example of

Accepted Answer

The statement is an exemption or disclaimer clause, as it is excluding all other warranties and stating that the only warranty is the one specified in the contract.

Question 20

Henry stops at a yard sale to look for old musical equipment.He sees an amplifier that is exactly what he has been looking for.Henry believes it is worth a lot more money than the $50 the owner is requesting.Henry asks the owner whether or not the amplifier is in good working condition.The owner tells him that he knows nothing about the amplifier and is not prepared to comment further.Henry purchases the amplifier for $50.Later he finds out that it is stolen from a nearby music store and did not belong to the seller at the time he purchased it.Henry's action for recovery of his money against the seller will

Accepted Answer

The seller's lack of knowledge about the amplifier is not enough to protect him from liability for selling stolen property. The principle of caveat emptor applies only when the seller is not causing any harm to the buyer by not disclosing information. Here, since the amplifier was stolen, the seller breached an implied term as to title, and Henry can recover his money.

Quiz 14: Sale of Goods and Consumer Contracts