Deck 23: The Sale of Goods

Question 1

A judge has found that Clear View Windows Inc.is liable to pay damages to a client for breach of one of its implied obligations under the Sale of Goods Act.Which of the following statements best describes the nature of the implied term breached by Clear View?

A) condition
B) pre contractual term
C) warranty
D) covenant

Answer 1

C

Question 2

EcoDesign Inc.(Eco)purchased 200 weeping caragana trees for spring planting from Abbot Garden Centre Ltd.Two weeks later,planting was complete and payment forwarded to Abbot.Two months later,Eco was served with a claim issued by Misty Tree Farms Ltd.,alleging non payment for the goods by Abbot Garden Centre and naming Eco as a third party to the claim.How was the Sale of Goods Act violated in this instance?

A) breach of contract
B) breach of innominate term
C) breach of implied term
D) breach of implied warranty

Answer 2

D

Question 3

Which of the following is relevant to a determination of what is reasonable with respect to the nature,intended purpose,and price paid for goods under consumer protection legislation?

A) warranty of quality and fitness
B) seller's express warranties
C) warranty of durability
D) warranty of acceptable quality

Answer 3

C

Question 4

Which of the following would most strongly influence the remedies available to a consumer under consumer protection legislation?

A) the reasonable foreseeability of damages
B) the seriousness of the breach of implied warranty
C) the onus on the party at fault to act quickly
D) the onus on the party at fault to correct the breach

Question 5

Alison advised the sales manager at SpudsRUs Ltd.that she had rejected the shipment of potatoes received from Spuds that morning.As this was the second consecutive shipment from Spuds contaminated with blight,Alison also advised Spuds she was cancelling the contract.Why is Alison able to do so?

A) because of the breach of innominate term
B) because of the right of repudiation
C) because of the breach of warranty
D) because of the doctrine of caveat emptor

Question 6

Why would a buyer be relieved of the implied statutory requirement to make its intended purpose of purchasing goods known to the seller of those goods?

A) The goods will be used in their ordinary purpose.
B) The buyer is reliant on the inspection of goods.
C) The goods will be bought by description.
D) The seller's goods are being sold by description

Question 7

Which transaction would fall under the Sale of Goods Act?

A) sale of a house
B) sale of a pallet of wood
C) sale of stock on the stock market
D) repairs to a motorcycle

Question 8

What is the name given to goods that are identified and agreed on at the time a contract of sale is made?

A) specific goods
B) appropriated goods
C) ascertained goods
D) specified goods

Question 9

Which of the following strongly supported the creation of principles set out in a specialized branch of contract law intended to provide a measure of protection for the purchaser of goods?

A) the need for modern law concerning the sale of goods and services
B) historic legislation titled the Sale of Goods Act,enacted in England in 1893
C) the civil code set of exceptions to the doctrine of caveat emptor
D) unfair results of the strict application of the doctrine of caveat emptor

Question 10

Which of the following would be considered immaterial with respect to the series of rules contained in the provincial sale of goods legislation that determine when title transfers?

A) under Rule 2,whether the contract for specific goods is unconditional
B) under Rule 5,whether goods are sold on approval or on "sale or return"
C) under Rule 3,the putting of goods into a deliverable state
D) under Rule 1,the postponement of time of payment or delivery

Question 11

Abby purchased a ring from an online vendor which unfortunately gave her a severe rash.The online description of the ring stated it was made of hypoallergenic materials.According to the Sale of Goods Act,why will the merchant likely have to accept the return of the product?

A) The seller refused the opportunity to compare goods with a sample.
B) The buyer relied on the description of goods by the seller.
C) The buyer made the intended use known at the time of purchase.
D) Goods sold by description must correspond to the description.

Question 12

Which statement is a criticism of the strict application of the common law maxim,caveat emptor?

A) It was not codified.
B) It unfairly favours the purchaser.
C) It is too costly to enforce.
D) It often produces unfair results.

Question 13

Which statement best describes the Convention on the International Sale of Goods (CISG)?

A) The CISG is mandatory in consumer sale of goods transactions.
B) The rules in the CISG are virtually identical to those in the Sale of Goods Act.
C) It applies to all international commercial contracts for the sale of goods.
D) It has been ratified by Canada and the United States.

Question 14

Vida commissioned Grundy,a famous local artist,to create a mural on the wall of her store.The paint is now peeling,and she wants to take action under the Sale of Goods Act.Which statement best describes the most likely outcome?

A) She cannot take action under the Sale of Goods Act because Grundy provided an intangible good.
B) She cannot take action under the Sale of Goods Act because of the principle,caveat emptor.
C) She cannot take action under the Sale of Goods Act because Grundy provided a service,not a good.
D) She cannot take action under the Sale of Goods Act because there were no implied terms or conditions in her contract with Grundy.

Question 15

Which term best describes a minor term in a contract for the sale of goods?

A) warranty
B) innominate term
C) implied term
D) condition

Question 16

Jemma wants to purchase a used Rolex watch from a pawnshop but is concerned the watch may have been stolen.Does the Sale of Goods Act imply any terms into the sale that may address her concerns?

A) No,this is a buyer beware situation.
B) Yes,there is an implied warranty that no third party will attempt to claim rights in the watch.
C) No,the Sale of Goods Act only applies to the quality and condition of the goods,not to the state of the title to the goods being sold.
D) Yes,it is an implied condition that the seller paid valuable consideration for the watch.

Question 17

Which of the following prohibits the defence of privity of contract?

A) provincial sale of goods legislation
B) federal and provincial consumer protection legislation
C) provincial consumer protection legislation
D) federal,provincial,and municipal sale of goods legislation

Question 18

Which of the following would be essential to determining a remedy with respect to the breach of a term under the sale of goods legislation?

A) product safety classification
B) the classification of the term
C) anticompetitive practices
D) disclosure on packaging

Question 19

Goodhealth Farms Inc.was sued by a customer,and the court has now ordered that the plaintiff is entitled to a reduction in the price initially agreed to in the contract.What is the most likely reason for the court's decision?

A) breach of a condition expressed in a contract for the sale of goods
B) breach of an innominate term of a contract for sale of goods
C) breach of warranty under sale of goods legislation
D) breach of a condition under sale of goods legislation

Question 20

Which of the following roughly approximates the meaning of the term caveat emptor?

A) voluntary assumption of risk
B) let the buyer beware
C) the thing speaks for itself
D) haste makes waste

Question 21

Mack Transmissions Ltd agreed to overhaul Dan's car transmission for $600.What impact will the Sale of Goods Act have on this transaction?

A) The Act will result in a duty to ensure the overhauled transmission is fit for its intended purpose.
B) The Act will have no application to the transaction.
C) The Act will impose a statutory duty on the customer to provide payment immediately upon delivery of the services.
D) The provisions of the Act governing merchantability will apply.

Question 22

Why is it important to determine when the title to goods passes from the seller to the buyer?

A) because payment is due when title passes
B) because the party with title is responsible for delivery costs
C) because risk usually passes with title
D) because the seller can no longer be sued once title has passed to the buyer

Question 23

Which statement is a distinguishing feature of the Sale of Goods Act?

A) It does not apply to leases of goods.
B) It applies to intangible and tangible property.
C) Its terms are mandatory and cannot be contracted out of.
D) It does not apply to consumer transactions.

Question 24

The owner of ToolShack Rentals Ltd.loaned (free of charge)a carpet steamer to an acquaintance.What impact will the Sale of Goods Act have on this transaction?

A) It will only apply if ToolShack attempts to sue the borrower for damages to its equipment.
B) It will import an implied condition of merchantability into the arrangement.
C) It will not apply to the transaction.
D) It will require ToolShack to supply goods that are fit for their intended purpose.

Question 25

EcoGreen Garden Centre Inc.will pay $2400 for the two tons of organic fertilizer it ordered for delivery in March.The fertilizer is to be packaged in 20 kilogram bags and then packed onto two separate one ton pallets for shipment.What rule under sale of goods legislation will dictate when title to the goods passes to EcoGreen?

A) Rule 1
B) Rule 2
C) Rule 3
D) Rule 4

Question 26

Deep Check
D)A.D.Enterprises Inc.(DAD)is located in Whitehorse.It has entered into a contract for the purchase of goods from Finnigan Fishing Rods & Reels Ltd.In accordance with the terms of the contract,Finnigan must,among other things,arrange shipping.What type of arrangement exists between these parties?

A) p.p.d.Whitehorse
B)
C)
C)i.f.Whitehorse

Question 27

Jasper Tiles prepared a customized order of tiles and informed the client they were in a deliverable state and ready for pick up.Unfortunately,the client now refuses to pick up and wants to cancel the order.What is Jasper's remedy in this situation?

A) damages for non acceptance
B) no remedy because it still has possession of the goods
C) an action for the price
D) no remedy because it still has title to the goods

Question 28

What is the relationship between ownership of the goods and who bears the risk of loss in a sale of goods transaction?

A) There is no relationship because risk passes when the goods are paid for.
B) Risk of loss passes from seller to buyer when ownership passes.
C) Risk of loss and ownership passes when the goods are paid for and delivered to the buyer.
D) Ownership and risk of loss both pass when the contract for sale is formed.

Question 29

What is the legal term for an unpaid seller's right to claim under sale of goods legislation in circumstances where the title to goods has transferred to the buyer?

A) account for profits
B) breach of contract
C) action for price
D) stoppage in transit

Question 30

How did the British Parliament's passage of the Sale of Goods Act impact the law concerning the sale of goods?

A) The Act extended protection for commercial sale of goods transactions to consumer sale of goods transactions.
B) The Act was the first legal recognition of implied terms into contracts for the sale of goods.
C) The Act created the principle 'caveat emptor'.
D) The Act summarized the existing common law principles for sale of goods transactions.

Question 31

Ariafyn Equestrian Farm ordered a maximum of $1200 worth of oats for delivery by October 30 from Mike,a local farmer.On October 12,Mike stopped at the grain elevator scales to weigh the truckload of oats,which indicated Ariafyn would owe $1293 for the load.Mike was inside the office obtaining the certificate of weight when a passing train derailed,sending a rail car colliding into Mike's truck.Which party will have the right to sue the railway company for the loss of the oats?

A) Ariafyn; risk transfers with the appropriation of unascertained goods
B) Mike; the buyer must be notified once the price is ascertained
C) Ariafyn; the goods are weighed and the price has been ascertained
D) Mike; Ariafyn must signal its adoption of the transaction

Question 32

Which of the five transfer of title rules would mostly likely be applied to determine when title passed in the case of a standing order contract?

A) Rule 1
B) Rule 2
C) Rule 3
D) Rule 4

Question 33

SolarPrime Energy Inc.has just delivered five solar power converters to a homeowner who is adding solar power her electrical service for her home.Which of the following best describes the legal position of SolarPrime now that it has completed delivery?

A) Title has now passed to the homeowner.
B) Payment is now due from the homeowner.
C) Risk has now passed to the homeowner.
D) It is impossible to say whether title has passed without more information.

Question 34

Which of the following is a warranty implied by the Sale of Goods Act?

A) that the goods will be of merchantable quality
B) that the goods are free of liens and encumbrances
C) that the goods are fit for their intended purpose
D) that goods sold by sample will correspond with the sample

Question 35

Which statement best describes a bill of lading?

A) It sets out when title passes from the seller to the buyer.
B) It is a contract between the seller and carrier.
C) It provides evidence of when the goods have transferred from the seller to the buyer.
D) It sets out the purchase price and cost of shipping and insurance.

Question 36

Which statement best describes the common law position with respect to the purchase of goods?

A) Purchasers are expected to make appropriate investigations before buying.
B) Sellers are liable for all defects in their goods.
C) Sellers are liable only for major defects in their goods.
D) Purchasers have a duty to ensure the goods are fit for their purpose.

Question 37

At what point will title to goods pass to the buyer when the contract involves the sale of future or unascertained goods?

A) when the goods are accepted by the buyer
B) when the goods are unconditionally appropriated to the contract
C) when the goods are delivered
D) when the goods come into existence

Question 38

Which of the following is a condition implied by the Sale of Goods Act?

A) that the seller has the right to sell the goods
B) that the goods will correspond to the sample
C) that the goods are free from liens and encumbrances
D) that delivery will occur in a reasonable period of time

Question 39

Why is the determination of when ownership is transferred important in the context of contracts for the sale of goods?

A) because of the historic legal maxim 'risk follows title'
B) because goods can be possessed without being owned
C) because the right to sue ends when title passes to the buyer
D) because the goods must be paid for when title passes to the buyer

Question 40

Which of the following would strongly influence a seller's ability to exercise its right to stoppage in transit with respect to the sale of goods?

A) the goods have not been delivered to the carrier
B) the goods remain undelivered,and the buyer has become insolvent
C) the buyer of the goods has become insolvent
D) the seller is unable to arrange for insurance for the goods

Question 41

Which of the following should a legal risk manager insist upon with respect to advertising performance claims about a new product the company is promoting?

A) keeping improper practices secret
B) implementing a cynical marketing strategy to cover a lack of due diligence
C) establishing a justification through scientific evidence
D) speedily retracting false statements

Question 42

The parties to a sale of goods transaction may agree to exclude,or vary,the terms implied by the Sale of Goods Act.

Question 43

The provincial Sale of Goods Act sets out a series of mandatory rules for determining when title will pass from seller to buyer.

Question 44

Once goods are delivered to a carrier under a c.i.f. contract, the seller typically submits the bill of lading and certificate of insurance to the buyer in exchange for payment of the price of the goods.

Question 45

The concept of protecting the consumer implicitly assumes that the commercial purchaser is better able to take care of itself and does not require any kind of safeguards.

Question 46

Unascertained goods must be identified and agreed on at the time a contract is made.

Question 47

A customer who has made its purpose for a particular product known to the seller will be deemed to have relied on the advice of the seller in selecting a product fit for that purpose.

Question 48

The rules contained in the sale of goods legislation that determine when title to goods shifts also affect the seller's right to claim damages for non acceptance.

Question 49

The CISG usually orders specific performance (fulfillment of the contract by the defendant)as the primary remedy.

Question 50

When a condition in a sale of goods contract is breached,the sale of goods legislation permits the buyer to ask the court to reduce the purchase price due to the breach.

Question 51

In a free on board contract,the seller specifies the type of transportation to be used.

Question 52

A warranty is implied under sale of goods legislation that requires the seller to have the right to sell the goods.

Question 53

It is an implied condition of the Sale of Goods Act that that the goods will be reasonably fit for their intended purpose.

Question 54

Goods not yet set aside and identifiable as the subject of the contract are to be specifically ascertained at the time the contract is formed.

Question 55

In the event of a breach of an implied condition,the buyer will be limited to suing for damages.

Question 56

Every province has passed legislation that prohibits the parties from excluding,or varying,implied Sale of Goods Act terms in consumer transactions.

Question 57

Tinsel X Mas Trees received 200 trees from Misty Tree Farms Ltd.for sale during the holiday season.Tinsel paid a deposit of $500,and Misty granted payment terms of 30 days from the date of delivery.Should Tinsel sell all of the trees but neglect to remit payment within the 30 days,Misty will be entitled to claim an action for the price.

Question 58

The determination of when ownership is transferred is important because of the historic legal maxim that risk follows title.

Question 59

The Latin phrase caveat emptor forms the foundation of common law's expectation of purchasers to be aware of what they are purchasing and to make appropriate investigations before buying.

Question 60

Generally speaking,the Sale of Goods Act does not apply to the provision of commercial software.

Question 61

Outline the origins and development of modern sale of goods law?

Question 62

Describe how the Sale of Goods Act determines when title passes between the seller and buyer.

Question 63

Explain the difference between the shipping terms "c.i.f." and "f.o.b." Which shipping term imposes the most obligations on the seller?

Question 64

Briefly discuss the right of repudiation with respect to the sale of goods.

Question 65

The initials c.i.f. stand for “cost, insurance, freight”.

Question 66

Outline three differences between the Convention on the International Sale of Goods (CISG)and provincial Sale of Goods Act legislation.

Question 67

With respect to the sale of goods legislation,briefly discuss the remedies for breach of warranty.

Question 68

Briefly discuss the role of a bill of lading.