Question 1

Office Suppliers, Inc. and Little Office Shop enter into a contract for a sale of office supplies. Office Suppliers is the seller. Under a shipment contract, the Office Suppliers does not have to

Accepted Answer

Under a shipment contract, the seller is only required to put the goods in the hands of the carrier for delivery to the buyer. The seller is not obligated to deliver the goods to a particular destination, as in a destination contract. The seller also does not have to obtain and deliver any necessary documents to the buyer, but must promptly notify the buyer when the shipment has been made.

Question 2

A buyer who obtains substitute goods to replace goods that a seller did not deliv?er can also recover damages from the seller.

Accepted Answer

This is known as cover damages and allows the buyer to recover the cost of obtaining substitute goods if the seller did not deliver as agreed.

Question 3

In general, a buyer's duty to pay for tendered goods becomes absolute be?fore the buyer has had an opportunity to inspect the goods.

Accepted Answer

The answer of In general, a buyer's duty to pay...

Question 4

If, before the time for performance, a buyer communicates an intent not to perform, the seller can consider the buyer in breach and pursue a remedy.

Accepted Answer

If a buyer communicates an intent not to perform before the time for performance, it can be considered a breach of contract and the seller can pursue a remedy.

Question 5

A buyer may reject a seller's goods under any circumstances.

Accepted Answer

A buyer may only reject a seller's goods under certain circumstances, such as if they are defective or do not meet the specifications of the purchase agreement.

Question 6

If a seller fails to deliver the goods, the buyer's damages do not include all losses resulting from this course of events.

Accepted Answer

If a seller fails to deliver the goods, the buyer's damages may include all losses resulting from this course of events, such as additional costs incurred to obtain similar goods elsewhere, lost profits from not being able to use the goods as intended, and potential harm to the buyer's reputation from not being able to fulfill their own obligations to their customers.

Question 7

Elegant Carpets, Inc., and Fantastic Floors Stores enter into a contract for a sale of carpeting. Under a shipment contract, the seller must

Accepted Answer

Under a shipment contract, the seller's responsibility is to place the goods into the hands of a carrier. The carrier then assumes responsibility for delivery of the goods to the buyer. The buyer does not have the right to reject the goods for any reason, and the seller is not required to deliver the goods to a particular destination or inspect the goods before shipping them.

Question 8

Clear Day Company, which is based in Delaware, agrees to sell fifty windows, currently stored in Florida, to Far Vu, Inc., which is based in Hawaii. Absent an agreement to the contrary, the place of deliv?ery is in

Accepted Answer

The answer of Clear Day Company, which is based in...

Question 9

Once the seller has tendered delivery, the buyer is obligated to accept the goods and pay for them.

Accepted Answer

This is known as the "obligation to accept" or "tender of delivery." Once the seller has properly fulfilled their delivery obligations as outlined in the sales contract or agreement, the buyer is legally obligated to accept the goods and pay for them as agreed.

Question 10

Under the UCC, parties to a contract cannot limit or exclude consequential damages.

Accepted Answer

Parties to a contract can limit or exclude consequential damages under the UCC, as long as the limitation or exclusion is not unconscionable.

Question 11

If a buyer breaches a contract while the seller is still in possession of the goods, the seller can resell the goods and hold the buyer liable for any loss.

Accepted Answer

This is known as the right to resale, which allows the seller to resell the goods and hold the buyer liable for any loss if they breach the contract before the goods are delivered.

Question 12

If a seller asks a buyer to store nonconforming goods overnight, then the buyer is entitled to reimbursement for the costs involved.

Accepted Answer

According to the UCC 2-7-501, if a buyer stores nonconforming goods for a seller, the buyer is entitled to reimbursement for the reasonable costs involved.

Question 13

If goods identified to a contract are destroyed through no fault of either party, both parties are excused from performance.

Accepted Answer

This is known as the doctrine of impossibility or frustration of purpose. If the goods are destroyed due to an unforeseen event, such as a natural disaster or a fire, and neither party is at fault, it is considered an impossibility of performance, and both parties are excused from their obligations under the contract.

Question 14

Big Eggs, Inc. agrees to supply Omelet Express with five hundred eggs. Big Eggs cannot reasonably ask Omelet Express to pick up the eggs at

Accepted Answer

Since Omelet Express is a restaurant, it is not likely to be open at 4:30 a.m. Therefore, it is not reasonable for Big Eggs to ask Omelet Express to pick up the eggs at that time. The other options fall within normal business hours and therefore are reasonable options for pick-up times.

Question 15

If a seller repudiates a contract, the buyer's damages do not have to be adjusted to reflect any expenses that were saved as a result of the breach.

Accepted Answer

According to the doctrine of mitigation of damages, the buyer has a duty to take reasonable steps to mitigate their losses caused by the seller's breach. This includes taking actions to avoid or minimize the damages suffered, as well as making efforts to reduce the costs or expenses incurred as a result of the breach. Therefore, if the buyer is able to save any expenses due to the seller's breach, these savings must be taken into account when calculating the damages owed by the seller.

Question 16

Sparkling Gem Corporation agrees to sell Jewel Outlets, Inc. (JOI), fifty new diamonds, but the contract does not specify a place of delivery. JOI is expected to pick up the goods. The place of delivery is

Accepted Answer

The answer of Sparkling Gem Corporation agrees to sell Jewel...

Question 17

If a buyer wrongfully refuses to accept goods that conform to a contract, the seller can recover damages.

Accepted Answer

This is a basic principle of contract law known as "anticipatory repudiation," which allows the non-breaching party (in this case, the seller) to recover damages if the other party wrongfully refuses to perform their obligations under the contract.

Question 18

Unless otherwise agreed, inspection of goods can take place at any reasonable place and time and in any reasonable manner.

Accepted Answer

This is stated in Article 38 of the United Nations Convention on Contracts for the International Sale of Goods (CISG).

Question 19

If a buyer repudiates a contract, the seller cannot re?cover damages.

Accepted Answer

If a buyer repudiates a contract, the seller can recover damages.

Question 20

On a lessee's insolvency, the lessor can stop delivery of the goods.

Accepted Answer

According to the principle of termination on insolvency, a lessor has the right to stop delivery of the goods if the lessee becomes insolvent. This is to protect the lessor's interest in the goods and prevent further losses. Therefore, the statement is true.

Quiz 19: Performance and Breach of Sales Lease Contracts