Question 1

Parker, a salesperson for Quality Textiles, Inc., shows Rosa, a fabric buyer for Style Clothing Company, samples of cloth, stating that any ship?ment will match the samples. This statement is

Accepted Answer

Parker's statement is an example of an express warranty because they made a specific statement about the product matching the samples.

Question 2

Good Tire Company and Hiway Auto Service enter into a contract for a sale of tires. Good Tire is a merchant who deals in goods of the kind sold. Under the UCC, an implied warranty of merchantability arises

Accepted Answer

According to the UCC, an implied warranty of merchantability automatically arises in sales contracts when the seller is a merchant who deals in goods of the kind sold. Thus, the buyer does not need to ask for it, and the seller does not need to expressly affirm it. The warranty ensures that the goods sold are of a quality that is reasonably fit for their ordinary purpose.

Question 3

Fact Pattern 23-B1 
HiDef, Inc., a television set maker, provides a limited warranty on its com?puters in a contract that includes an "informal dispute settlement proce?dure" clause. Ike buys an HiDef computer, which soon malfunctions. After several unsuc?cessful repair attempts, Ike files a suit against HiDef, seeking damages under the Magnuson-Moss Warranty Act.
-Refer to Fact Pattern 23-B1. Suppose that the dispute-resolution clause in HiDef's contract calls for binding arbitration. A court is most likely to order

Accepted Answer

If the contract includes a binding arbitration clause, the court is most likely to order the parties to arbitrate the dispute. The Magnuson-Moss Warranty Act does not prohibit arbitration agreements, and courts generally enforce such agreements unless they are unconscionable or otherwise unenforceable. Therefore, unless the arbitration clause is invalid, the parties will be required to arbitrate their dispute rather than proceed to trial.

Question 4

Value Tools, Inc., sells tools, tool parts, and related supplies under "full" warranties. Under the Magnuson-Moss Warranty Act, this means that Value Tools must provide

Accepted Answer

The Magnuson-Moss Warranty Act requires that manufacturers offer a choice between a refund or replacement if a product cannot be fixed and repair or replacement of defective parts. Since Value Tools sells products under "full" warranties, they must comply with this requirement.

Question 5

Fact Pattern 23-B1 
HiDef, Inc., a television set maker, provides a limited warranty on its com?puters in a contract that includes an "informal dispute settlement proce?dure" clause. Ike buys an HiDef computer, which soon malfunctions. After several unsuc?cessful repair attempts, Ike files a suit against HiDef, seeking damages under the Magnuson-Moss Warranty Act.
-Refer to Fact Pattern 23-B1. The court is most likely to order

Accepted Answer

The contract between HiDef and Ike includes an "informal dispute settlement procedure" clause, which means that before proceeding to trial, the parties are expected to attempt to resolve the dispute outside of court. Therefore, the court is most likely to order the parties to attempt to informally resolve the dispute before moving forward with a trial.

Question 6

Imported Carpets Store and Jill enter into a contract for a sale of an Oriental rug. Imported Carpets, a merchant who deals in goods of the kind sold, generally describes the goods, details technical specifications, and shows a sample. Under the UCC, if these are inconsistent

Accepted Answer

According to the UCC, if there is an inconsistency between the general description, technical specifications, and the sample, the sample takes precedence. This is because the sample is considered to be the best representation of the goods being sold and serves as a physical reference point for the buyer to rely on.

Question 7

Neil goes to Oil Shop to change the oil in his car. Pat, the service tech?ni?cian, learns that Neil plans to take a trip and advises the use of a certain type of oil. The oil breaks down during the trip, damaging the car. Neil may recover from Oil Shop for breach of

Accepted Answer

Pat, the service technician, advised Neil on the certain type of oil to be used for his trip, implying that it is fit for a particular purpose (the trip). Thus, there is an implied warranty of fitness for a particular purpose. When the oil breaks down during the trip and damages the car, Neil may recover from Oil Shop for breach of this implied warranty.

Question 8

Oceanic Vessels, Inc., and Pacific Harbor Company enter into a contract for a sale of a boat. Oceanic is a merchant who deals in goods of the kind sold. The goods are defective. Under the UCC, the implied warranty of merchantability is breached

Accepted Answer

Under the UCC, the implied warranty of merchantability applies to merchants who deal in goods of the kind sold. It requires that the goods must be fit for their ordinary purpose, and be of at least average quality and design. This warranty is breached regardless of whether the merchant knew about or could have discovered the defect.

Question 9

Regional Lumber Company and Superior Builders Corporation enter into a contract for a sale of wood products. Regional, a merchant who deals in goods of the kind sold, makes implied and express warranties in connection with the sale. Under the UCC, if these are inconsistent

Accepted Answer

The answer of Regional Lumber Company and Superior Builders Corporation...

Question 10

Dependable Appliances, Inc., and Elain enter into a contract for a sale of kitchen appliances. Dependable, a merchant who deals in goods of the kind sold, notes that its goods come with an implied warranty of merchantability. Under the UCC, this means that the goods are reasonably

Accepted Answer

The implied warranty of merchantability under the UCC means that the goods are reasonably fit for the ordinary purpose for which such goods are used. Therefore, option B is the correct choice.

Question 11

Trucks & Trailers, Inc. (T&T), and United Delivery Service enter into a contract for a lease of trucks. T&T is a merchant who deals in goods of the kind leased. Under the UCC, an implied warranty of merchantability arises

Accepted Answer

Under the UCC, an implied warranty of merchantability automatically arises in lease contracts when the lessor is a merchant dealing in goods of the kind leased.

Question 12

Sari buys a new sport utility vehicle (SUV) from Terrific Cars & Trucks, Inc. The most important factor in determining whether an ex?press war?ranty is created is whether

Accepted Answer

The most important factor in determining whether an express warranty is created is whether Terrific's promise becomes part of the basis of the bargain. This means that Terrific's promise must have influenced Sari's decision to purchase the SUV. Expressions of desire or expectation are not enough to create an express warranty.

Question 13

City Car Company and Dave's Autos enter into a contract for a sale of motor vehicles. City assures Dave's that it has valid title to the vehicles. Under the UCC, a warranty of title arises

Accepted Answer

Under the UCC, a warranty of title arises automatically in most sales contracts. This means that as long as the sale of motor vehicles is a typical sales transaction, a warranty of title exists without any explicit agreement between the parties.

Question 14

Garden Work, Inc., sells consumer lawn care equipment. Garden Work's sales contracts include express warranties. According to the Magnuson-Moss Warranty Act, Garden Work can also disclaim

Accepted Answer

The Magnuson-Moss Warranty Act does not allow a seller to disclaim implied warranties if an express warranty is provided. Therefore, Garden Work cannot disclaim any implied warranties.

Question 15

Regal Autos, Inc., sells cars to consumers. To avoid liability for oral ex?press warranties, each sales agreement should note that a car is sold

Accepted Answer

Including a clause that states warranties are limited to those in the written contract helps avoid liability for any oral express warranties that might have been made during the sales process.

Question 16

Mountain Bikes, Inc. (MBI), and Nero enter into a contract for a sale of a mountain bike. MBI, a merchant who deals in goods of the kind sold, makes implied and express warranties in connection with the sale. The Magnuson-Moss Warranty Act attempts to prevent deception in warranties by

Accepted Answer

The answer of Mountain Bikes, Inc. (MBI), and Nero enter...

Question 17

Merchant Supply Company and National Discount Stores enter into a contract for a lease of cash registers. Merchant assures National that it has valid title to the goods. Under the UCC, a warranty of title arises

Accepted Answer

The answer of Merchant Supply Company and National Discount Stores...

Question 18

Sweet Candy, Inc., and Tasty Treats Stores enter into a contract for a sale of candy. Sweet, a merchant who deals in goods of the kind sold, makes express warranties in connection with the sale. Under the UCC, at the time a contract is formed, an express warranty can be disclaimed or modified

Accepted Answer

The UCC allows for express warranties to be disclaimed or modified only by clear, conspicuous language called to the buyer's attention. This ensures that the buyer is aware of any changes to the express warranty before entering into the sale. The other options are not correct because implied affirmations of fact can create an express warranty and the seller cannot disclaim or modify the warranty in any way they see fit without notifying the buyer. Finally, the UCC does not allow for disclaiming or modifying express warranties in no way.

Question 19

Fact Pattern 23-A1 
Bret, a representative of Concrete Products, Inc. assures Dependable Construction Company that Concrete's cement will not crack within a certain range of temperatures. DCC uses the product. When cracks develop within the stated temperature range, DCC files a suit against Concrete.
-Refer to Fact Pattern 23-A1. The court is most likely to rule in favor of

Accepted Answer

Bret's statement constitutes an express warranty, a promise made by the seller that the product will conform to certain standards, in this case, the range of temperature in which the cement will not crack. DCC relied on this promise and purchased the product, so if the product fails to conform to the express warranty, DCC can hold Concrete accountable for any resulting damages. The fact that DCC voluntarily chose to use Concrete's product and that Bret's statement may be seen as an expression of opinion is irrelevant as regardless of how the parties entered into the transaction, there was an express warranty that was breached.

Question 20

Olga, a salesperson for Pre-owned Cars & Trucks, Inc., tells Quincy, "This is the best car I've ever seen." This statement is

Accepted Answer

Olga's statement is an example of puffing, which is an exaggeration of a product's qualities or features. It is not a legally enforceable warranty, either express or implied.

Quiz 23: Warranties and Product Liability