Question 1

Under the concept of ______, only the original parties to a sales contract could sue each other.

Accepted Answer

The concept described in the question is privity of contract. It refers to the legal relationship between the parties who have entered into a contract, and only those parties have the right to sue each other for a breach of the contract. This means that third parties who may be affected by the contract do not have the right to sue the parties involved.

Question 2

If there is a written contract, a disclaimer of the implied warranty of merchantability must be conspicuous.

Accepted Answer

According to the Uniform Commercial Code (UCC), if there is a written contract, a disclaimer of the implied warranty of merchantability must be conspicuous, meaning it must be written in a way that is clear and obvious to the average person, and cannot be buried in the fine print.

Question 3

Manufacturers who prepare goods to the buyer's specifications are under exceptionally stringent warranty obligations for fitness for a particular use.

Accepted Answer

Manufacturers who prepare goods to the buyer's specifications are generally not under stringent warranty obligations for fitness for a particular use, as the buyer specifies the requirements and assumes responsibility for the suitability of the goods.

Question 4

Under what type of warranty is the seller obligated to fix or replace a defective product within a reasonable time at no cost to the buyer?

Accepted Answer

A full warranty requires the seller to fix or replace a defective product within a reasonable time at no cost to the buyer.

Question 5

An inadequate warning label about a product's dangers can be considered a defective product.

Accepted Answer

An inadequate warning label can be considered a defective product under product liability law because it does not properly communicate the risks associated with the product to the consumer, which can lead to harm or injury.

Question 6

If an express warranty is breached:

Accepted Answer

If an express warranty is breached, the warrantor is always liable for any resulting damages or losses to the buyer. There are no exceptions based on due care, buyer's inspection, or good faith belief in the warranty's accuracy. The only defense for the warrantor is to disclaim or limit the warranty in a legally acceptable manner.

Question 7

Which of the following statements made by the seller does not likely constitute an express warranty?

Accepted Answer

The statement "This looks beautiful on you" does not make any claims about the product itself and therefore does not constitute an express warranty. The other statements all provide specific information about the product that could be considered express warranties.

Question 8

In most instances, the mere fact that a sale was made gives rise to a(n):

Accepted Answer

The mere fact that a sale was made gives rise to an implied warranty, which means that the product is fit for its intended purpose, is of merchantable quality, and is free from hidden defects. Express warranties are made through statements or promises about the product, while limited and full warranties are specific types of warranties that are subject to certain limitations or conditions.

Question 9

An action for negligence rests upon common law tort principles.

Accepted Answer

Negligence is a common law tort, meaning it is a civil wrong that is recognized by the courts based on common law principles. Therefore, an action for negligence does indeed rest upon common law tort principles.

Question 10

A limited warranty includes all of the following scenarios except:

Accepted Answer

A limited warranty typically requires the buyer to pay for repairs or replacement, and may only cover part of the product. Option D describes a full warranty, where the manufacturer replaces the defective product at no charge.

Question 11

A disclaimer of warranties made in the manner specified by the Uniform Commercial Code is not unconscionable.

Accepted Answer

A disclaimer of warranties made in accordance with the Uniform Commercial Code's provisions is considered enforceable and fair under the law. Such disclaimers protect sellers from unrealistic liabilities and help define their liability scope, making it reasonable and justifiable. Therefore, it is not considered unconscionable.

Question 12

If a merchant sells a lawn mower that will not cut any type of grass, there is a breach of the warranty of merchantability.

Accepted Answer

The warranty of merchantability implies that the product is fit for its ordinary purpose. If a lawn mower cannot cut any type of grass, it suggests that the product is not of merchantable quality and therefore, breaches the warranty.

Question 13

An auto manufacturer is excused from strict liability if it can be shown the defect was in a component part purchased from a manufacturer.

Accepted Answer

Strict liability holds manufacturers responsible for their products, including all component parts. If a product causes harm due to a defect, the manufacturer is liable, even if the defect originated from a component made by another manufacturer.

Question 14

The federal regulation of express warranties:

Accepted Answer

The federal regulation of express warranties applies to a seller who makes a written express warranty for a consumer product costing more than $10. This regulation is known as the Magnuson-Moss Warranty Act.

Note: Option C is incorrect as there is no requirement for all express warranties to be full warranties. Option A and D are also incorrect as the regulation applies to both limited and full warranties, and it does not require an implied warranty to be designated as either full or limited.

Question 15

All of the following are product liability theories except:

Accepted Answer

All of the other answer choices, express warranty, implied warranty, and strict tort liability, are product liability theories. Assumption of the risk is a defense to a product liability claim, not a theory.

Question 16

The warranties of both merchantability and fitness for a particular purpose exist under the Convention on Contracts for the International Sale of Goods (CISG).

Accepted Answer

Both warranties exist under the CISG.

Question 17

Suppose a Ford truck slams into a parade and the driver claims the brakes failed. All of the following are potentially liable in a defective product suit except:

Accepted Answer

The bystanders would not be liable in a defective product suit as they have no involvement in the manufacturing or selling of the vehicle or its components. The potential liable parties in a defective product suit for brake failure in a Ford truck would include the Ford manufacturer, the manufacturer of the brakes, and possibly the Ford dealer if it can be shown they were negligent in servicing or inspecting the vehicle.

Question 18

The theories of product liability are mutually exclusive.

Accepted Answer

The theories of product liability are not mutually exclusive. In fact, many cases involve the application of multiple theories of liability simultaneously. The three main theories of product liability are strict liability, negligence, and breach of warranty.

Question 19

In applying the "foreign substance/natural substance" liability test in the sale of food or drink, some courts refuse to impose warranty liability if the thing in the food that caused the harm was naturally present.

Accepted Answer

Some courts may find that if the harmful substance was naturally present in the food, the seller cannot be held liable under a warranty theory. This is because the harm may be seen as an inherent risk of consuming the food, and the seller would not be able to reasonably prevent the presence of the substance. However, this may vary by jurisdiction and specific circumstances of the case.

Question 20

Unless otherwise agreed, every merchant seller warrants that goods are sold free of any rightful claim by any third party.

Accepted Answer

This statement is true. Unless there is an agreement stating otherwise, the merchant seller is responsible for ensuring that the goods they sell are free of any claims by third parties, such as liens or other ownership disputes.

Quiz 24: Product Liability: Warranties and Torts