Question 1

The perfect tender rule requires that the seller's tender of performance must conform exactly to the contract subject to:
A)installment contracts.
B)cure by the seller.
C)Both of the above.
D)Neither of the above.

Accepted Answer

The perfect tender rule does require that the seller's tender of performance must conform exactly to the contract, but there are two exceptions. The first exception is for installment contracts, where the seller's performance only needs to conform to the contract on a installment-by-installment basis. The second exception is the seller's right to cure non-conforming goods within a reasonable time. Therefore, both options A and B are exceptions to the perfect tender rule.

Question 2

A buyer's cancellation of a contract based on the seller's anticipatory repudiation is effective:
A)only if the buyer expressly notifies the seller of the cancellation.
B)if the cancellation precedes the seller's attempt to retract her repudiation.
C)only if bond has been obtained.
D)All of the above.

Accepted Answer

A buyer's cancellation based on the seller's anticipatory repudiation is effective if it precedes the seller's attempt to retract the repudiation. The buyer does not need to provide express notice or obtain a bond.

Question 3

The Elm Street Accounting Partnership has ordered two maroon office chairs for its waiting room from the Quality Office Supply Company.Quality sends two burgundy-red office chairs that the Elm Street partnership rejects.What, if any, rights does Quality have under the circumstances? Explain.

Accepted Answer

The answer of The Elm Street Accounting Partnership has ordered...

Question 4

If Mary allows the seller, Sellmart Co., four weeks to repair the defects in her kitchen set and they have tried but have not done a good job at it, she may revoke her acceptance if she:
A)notifies Sellmart of revocation.
B)does not use the table and chairs.
C)could not discover the defects easily.
D)inspected the goods herself.

Accepted Answer

According to the UCC (Uniform Commercial Code) §2-608, if the seller fails to cure the defects within the agreed-upon time, the buyer can revoke the acceptance of the goods by notifying the seller. Therefore, Mary can only revoke her acceptance if she notifies Sellmart of revocation.

Question 5

Goods are to be sent from Buffalo, NY to Raleigh, NC by UPS using the delivery terms F.O.B.Buffalo, NY.Where does tender occur?
A)Where the goods are identified.
B)Where the goods are shipped.
C)Where the goods are delivered.
D)Where the goods are taken by the buyer.

Accepted Answer

Tender of delivery occurs where the goods are shipped when using F.O.B. shipping point terms.

Question 6

Which of the following is correct with respect to the Code's approach to impossibility of performance?
A)A significant drop in demand for the goods will excuse the buyer's performance.
B)Increased production costs will excuse performance by the seller.
C)Performance will be excused when it is impractical as a result of one or more unforeseen supervening events that are more than mere hardship or increased cost of performance.
D)All of the above are correct.

Accepted Answer

The Code's approach to impossibility of performance is that it will be excused when it is impractical as a result of one or more unforeseen supervening events that are more than mere hardship or increased cost of performance. A significant drop in demand for the goods or increased production costs do not fall under this category and therefore are not correct.

Question 7

J & J Co.offers a "subscription" for baby toys to be delivered every two months from the birth of a child.Payment must be made within two weeks of delivery.The Markham family accepted the J & J plan when their son, Timmy, was born.When Timmy was four months old, one J & J toy arrived smashed to pieces.Markham:
A)can treat the whole contract as breached and refuse to pay for past installments as well as future installments.
B)can reject the installment and cancel the contract immediately.
C)can reject the installment and refuse to pay for it if J & J cannot cure it.
D)cannot reject the installment since it is part of a series.

Accepted Answer

The Markham family has the right to reject the installment and refuse to pay for it if J & J cannot cure it. They are entitled to receive defect-free products as part of the subscription plan, and J & J must ensure that the toys are delivered in good condition. If J & J cannot provide a replacement toy or fix the issue in a timely manner, the Markham family can refuse to pay for the defective toy. However, they cannot cancel the entire contract or reject future installments without giving J & J an opportunity to cure the problem.

Question 8

Whitaker has reasonable grounds for believing Crosslin will not perform his obligations under their contract.Discuss what Whitaker might do if their contract is governed by: (a) the UCC and (b) the CISG.

Accepted Answer

The answer of Whitaker has reasonable grounds for believing Crosslin...

Question 9

In which of the following situations does the seller have the right to cure?
A)Where the time for performance under the contract has not yet expired.
B)After the time for performance has expired if the seller had reasonable grounds for believing the buyer would accept a nonconforming tender with or without monetary adjustment.
C)Where the buyer has revoked acceptance.
D)Two of the above, (a) and (b).

Accepted Answer

The seller has the right to cure if the time for performance has not yet expired and if the seller had reasonable grounds for believing the buyer would accept a nonconforming tender with or without monetary adjustment. Therefore, options (a) and (b) are correct. The seller does not have the right to cure after the buyer has revoked acceptance (option (c)).

Question 10

The concept of the "right to cooperation" includes that:
A)where one party's required cooperation is not timely, the other party is excused from any resulting delay in her own performance.
B)where one party's required cooperation is untimely, the other party is required to tender performance as if the first party had tendered in a timely manner.
C)where neither party is at fault and the agreed manner of delivery becomes impracticable, both parties are required to negotiate a new price.
D)None of the above.

Accepted Answer

The concept of the "right to cooperation" means that each party has a duty to cooperate with the other and that where one party's cooperation is necessary for the other party to perform, the first party must provide timely cooperation. If the required cooperation is not timely, the other party may be excused from any resulting delay in her own performance.

Question 11

Sam agrees to sell Bill one 18-cubic-foot, yellow refrigerator for $700.It is to be delivered to Bill's home on July 7.Under the perfect tender rule, which one of the following cases would permit Bill to rightfully reject the goods?
A)Sam delivered an 18-cubic-foot, silver refrigerator on July 7, and Bill calls Sam to complain.
B)Sam sent an 18-cubic-foot, yellow refrigerator with a small dent in it on July 7.Bill refuses delivery but never bothers to call Sam.
C)Sam sent his truck to Bill's home with the 18-cubic-foot, yellow refrigerator on July 7, but Bill was not home.
D)Sam sent 18-cubic-foot, yellow refrigerator without ice cube trays on July 5 and notifies Bill of the defect.

Accepted Answer

BThe perfect tender rule requires the seller to deliver goods that conform exactly to the terms of the contract. In choice A, the color of the refrigerator does not match the contract specifications, allowing Bill to rightfully reject the goods. In choice B, the presence of a dent could be considered a defect, making the goods non-conforming to the contract, which also gives Bill the right to reject them.

Question 12

On June 1, Supertread Tire Company entered into a contract to provide 100 tires per month to ZYX Cycle Company at $30 per tire for the next two years.The October shipment consisted of 100 badly defective tires.ZYX Cycle Company:
A)can treat the whole contract as breached.
B)can reject the October shipment if it cannot be cured in a timely manner by Supertread.
C)cannot reject the October shipment since it is part of the installment series.
D)Answers (a) and (b) are acceptable under the UCC.

Accepted Answer

Under the UCC, if the October shipment of 100 badly defective tires cannot be cured by Supertread in a timely manner, ZYX Cycle Company can reject the shipment. However, ZYX Cycle Company cannot treat the whole contract as breached since it is a contract for installment series. Answer (a) is incorrect because the whole contract cannot be treated as breached. Answer (c) is also incorrect as the installment series cannot protect the supplier from breach of contract in the individual installment. Lastly, answer (d) is incorrect as only option (b) is acceptable under the UCC.

Question 13

A buyer in a contract for the sale of goods:
A)may not inspect the goods before payment or acceptance, unless the parties agree otherwise.
B)must pay prior to inspection with a C.O.D.sale, which impairs the buyer's remedies.
C)must bear the expenses of inspection, but may recover these costs from the seller if the goods are rightfully rejected.
D)loses the right to reject nonconforming goods by not inspecting them immediately upon delivery.

Accepted Answer

According to the Uniform Commercial Code (UCC), the buyer has the right to inspect the goods before accepting them. The buyer also has the right to reject nonconforming goods after inspection. However, the buyer is responsible for the expenses of inspection, but may recover these costs from the seller if the goods are rightfully rejected.

Question 14

When is a buyer deemed to have accepted goods that are delivered pursuant to a contract?
A)If he fails to reject the goods after he has had a reasonable opportunity to inspect them.
B)Immediately upon delivery.
C)Only when he pays for them.
D)Only after an express acceptance.

Accepted Answer

According to the UCC, a buyer is deemed to have accepted goods if he fails to reject them after a reasonable opportunity to inspect them. This means that if the buyer has had an opportunity to inspect the goods and does not reject them, he is accepting them. It is not necessary for the buyer to pay for the goods or provide an express acceptance.

Question 15

Bill orders a custom-made suit from Rooks to be delivered by Friday at 5 p.m.When the suit is delivered to his office on Friday afternoon, he is in conference with a client.He accepts delivery and hangs the suit in his closet.When Bill tries on the suit Saturday evening, he discovers that the pants are cuffed.He had ordered cuffless trousers, so he calls Rooks on Monday and informs them that he is returning the suit.What can he do?
A)He cannot revoke acceptance since the cuffs are not difficult to discover.
B)He can revoke acceptance if the cuffs substantially impair the value of the goods to him and Rooks will not remove the cuffs.
C)He can reject the goods since he had not yet accepted them prior to inspection.
D)He cannot reject the goods because the cuffs are curable.

Accepted Answer

According to the Uniform Commercial Code (UCC), a buyer can only revoke acceptance of goods if there is a defect that substantially impairs the value of the goods to them and the seller is unable or unwilling to cure the defect. In this case, the cuffs on the pants were not what the buyer had ordered, and if they substantially impair the value of the suit to him, he can revoke acceptance. However, if Rooks is willing and able to remove the cuffs, then the defect is curable, and the buyer cannot reject the goods. Therefore, B is the best choice.

Question 16

Speedy Stop sells necessities to neighborhood shoppers until 1
a.m.every day.Dairyland delivered its order of milk products as usual around 6
a.m.while Mary, the shopkeeper, was busy with the early coffee and donut crowd.The Dairyland driver left 12 crates in the refrigerator compartment and went on to the rest of his route.At 7:30
a.m., Mary started to shelve the milk products and discovered that all 12 crates contained buttermilk rather than the usual mix of containers of whole milk, 2%, skim milk, and cream she had ordered.What is her obligation with regard to the goods?

Accepted Answer

The answer of Speedy Stop sells necessities to neighborhood shoppers...

Question 17

Vernon is an accountant for a major accounting firm.One day at work, he is discussing his collection of rare coins with one of his co-workers.Vernon tells his co-worker that he keeps his collection at home and that he has recently purchased several Chinese gold Panda coins at an exceptional price.The co-worker expresses an interest in buying two of the coins at an agreed price, and a contract is duly formed.If no place for delivery is expressed, where are the coins to be delivered?
A)At the office of the major accounting firm where the parties to the contract work.
B)At Vernon's home.
C)At the co-worker's home.
D)In the parking lot of the major accounting firm.

Accepted Answer

Since Vernon keeps his collection at home and there is no place for delivery expressed in the contract, it can be inferred that the coins are to be delivered to Vernon's home.

Question 18

Seller, through no fault of its own, is unable to deliver the goods to buyer because the agreed type of carrier is unavailable.Explain what the Code requires.

Accepted Answer

The answer of Seller, through no fault of its own,...

Question 19

A manifestation by the buyer of his unwillingness to become the owner of the goods is:
A)acceptance.
B)revocation.
C)rejection.
D)tender.

Accepted Answer

Rejection refers to the act of the buyer refusing to accept the goods due to various reasons such as defects, delivery of wrong goods, etc. It signifies that the buyer does not wish to become the owner of the goods and wants to terminate the contract.

Quiz 20: Performance

The perfect tender rule requires that the seller's tender of performance must conform exactly to the contract subject to:

A buyer's cancellation of a contract based on the seller's anticipatory repudiation is effective:

The Elm Street Accounting Partnership has ordered two maroon office chairs for its waiting room from the Quality Office Supply Company.Quality sends two burgundy-red office chairs that the Elm Street partnership rejects.What, if any, rights does Quality have under the circumstances? Explain.

If Mary allows the seller, Sellmart Co., four weeks to repair the defects in her kitchen set and they have tried but have not done a good job at it, she may revoke her acceptance if she:

Goods are to be sent from Buffalo, NY to Raleigh, NC by UPS using the delivery terms F.O.B.Buffalo, NY.Where does tender occur?

Which of the following is correct with respect to the Code's approach to impossibility of performance?

Whitaker has reasonable grounds for believing Crosslin will not perform his obligations under their contract.Discuss what Whitaker might do if their contract is governed by: (a) the UCC and (b) the CISG.

In which of the following situations does the seller have the right to cure?

The concept of the "right to cooperation" includes that:

Sam agrees to sell Bill one 18-cubic-foot, yellow refrigerator for $700.It is to be delivered to Bill's home on July 7.Under the perfect tender rule, which one of the following cases would permit Bill to rightfully reject the goods?

On June 1, Supertread Tire Company entered into a contract to provide 100 tires per month to ZYX Cycle Company at $30 per tire for the next two years.The October shipment consisted of 100 badly defective tires.ZYX Cycle Company:

A buyer in a contract for the sale of goods:

When is a buyer deemed to have accepted goods that are delivered pursuant to a contract?

Seller, through no fault of its own, is unable to deliver the goods to buyer because the agreed type of carrier is unavailable.Explain what the Code requires.

A manifestation by the buyer of his unwillingness to become the owner of the goods is: