Question 1

"Conflict of Laws" in an international setting refers to which nation has the greater interest in applying its laws in the resolution of contract dispute cases.

Accepted Answer

Conflict of Laws, also known as Private International Law, involves determining which country's laws will be applied in a cross-border dispute. This is based on the principle of finding the nation that has the most significant relationship or interest in the dispute. Therefore, the answer is true.

Question 2

Cultural influences play an insignificant role in the way people approach contract negotiations and contract drafting.

Accepted Answer

Cultural influences can greatly impact the way people approach contract negotiations and drafting. For example, in some cultures, building a personal relationship and establishing trust before discussing business matters is crucial, while in others, being direct and concise is preferred. Additionally, different cultures may have varying expectations about the level of detail and specificity in contract language.

Question 3

The term "trade usage" refers to the customs of an industry, past dealings of merchants, and the usages of trade terminology and language.

Accepted Answer

Trade usage refers to all of the above – customs, past dealings, and language – within a particular industry or trade.

Question 4

When an international seller and buyer negotiate a sales contract, they have the option to "opt out" of CISG.

Accepted Answer

The United Nations Convention on Contracts for the International Sale of Goods (CISG) is not automatically applied to sales contracts between parties from different countries. The parties have the option to opt-out of CISG and choose their own governing law for the contract.

Question 5

A buyer of goods has no obligation under the CISG to examine goods promptly when received and give notice of an error in shipment.

Accepted Answer

According to Article 38 of the CISG, the buyer must examine the goods promptly or within a reasonable time after their receipt. If the buyer fails to give notice of any lack of conformity within a reasonable time, the seller is no longer liable for any defects. Therefore, the buyer has an obligation to examine the goods promptly and give notice of any errors in shipment.

Question 6

Under common law, a contract is formed when the notice of acceptance has been sent by the mode required by the other party under the mailbox rule.

Accepted Answer

Under the mailbox rule, a contract is formed when the notice of acceptance has been sent by the mode required by the other party. This is a longstanding principle in common law.

Question 7

Because the laws are similar in most countries, there are few problems with international sales contracts.

Accepted Answer

While many countries have similar laws regarding international sales contracts, there are still differences that can create problems. It is important to carefully review and understand the applicable laws when entering into an international sales contract.

Question 8

The provisions concerning express and implied warranties are similar under the UCC and CISG.

Accepted Answer

Both the UCC and CISG provide for warranties of quality, and both allow for both express and implied warranties. Therefore, the provisions concerning warranties are similar under both laws. However, there are some differences in the specific requirements for warranties under each law.

Question 9

The Convention on Contracts for the International Sale of Goods (CISG) was developed to give U.S. business an advantage in international sales contracts.

Accepted Answer

The CISG was developed by the United Nations Commission on International Trade Law (UNCITRAL) with the goal of creating uniform rules for international sales contracts, and was not specifically developed to benefit U.S. business. It applies to contracts for the sale of goods between parties from different countries that have ratified the convention.

Question 10

U.S. lawyers generally prefer to draft contracts in exacting, detailed, and technical language while Japanese contracts generally tend to be short and with relatively little detail.

Accepted Answer

This is generally true, as the legal culture in the United States emphasizes precise and detailed language in contracts, while Japanese legal culture tends to prioritize concision and brevity.

Question 11

Under the CISG, all contracts for the sale of goods must be in writing.

Accepted Answer

The CISG does not require contracts for the sale of goods to be in writing. They can be oral or implied through the conduct of the parties. However, some national laws may require certain contracts to be in writing for enforcement purposes.

Question 12

Consequential money damages for breach of a sales contract may also include an amount for lost profits arising as a reasonably foreseeable loss due to the breach.

Accepted Answer

Consequential damages can include lost profits that were foreseeable at the time of contracting.

Question 13

International sales contracts concerning consumer goods sold for personal use come under CISG.

Accepted Answer

The United Nations Convention on Contracts for the International Sale of Goods (CISG) generally does not apply to sales of goods bought for personal, family, or household use unless the seller, at any time before or at the conclusion of the contract, neither knew nor ought to have known that the goods were bought for any such use.

Question 14

Under common law, the offeror can withdraw his offer if withdrawal occurs before a transmitted acceptance is received.

Accepted Answer

The answer of Under common law, the offeror can withdraw...

Question 15

Historically, multinational corporations were at a disadvantage in contract negotiations with developing countries.

Accepted Answer

Historically, multinational corporations held significant bargaining power in contract negotiations with developing countries due to their strong economic and political influence.

Question 16

Money damages for breach of a sales contract is usually based on the difference between the market price and the contract price.

Accepted Answer

This is generally true. Damages for breach of a sales contract can be calculated based on the difference between the market price and the contract price, as well as any additional costs incurred as a result of the breach. However, the actual calculation can vary depending on the specific circumstances and terms of the contract.

Question 17

Specific performance is an equitable remedy requiring a party to pay the non-breaching party a specified sum of money for breach of contract.

Accepted Answer

Specific performance is not a remedy requiring payment of money for breach of contract. Rather, it is a remedy that requires the breaching party to perform their contractual obligation as specified in the agreement.

Question 18

In practice, most force majeure clauses do not excuse a party's performance entirely but only suspend it for a while.

Accepted Answer

Force majeure clauses typically provide for a temporary suspension of performance rather than a complete excuse from performance. This allows the affected party to resume performance once the force majeure event has passed.

Question 19

In the People's Republic of China, domestic contract law serves largely to enforce commitments made between state agencies.

Accepted Answer

The answer of In the People's Republic of China, domestic...

Question 20

The CISG makes no provision for "trade usages" since everything is defined.

Accepted Answer

The CISG does recognize the importance of trade usages in interpreting and understanding contractual terms. Article 9 specifies that the parties should be guided by any "usages to which they have agreed" and any "practices which they have established between themselves," as well as any relevant "usages of which the parties knew or ought to have known."

Quiz 4: The Formation and Performance of Contracts for the Sale of Goods