Question 1

If a supplier delivered goods that violated a trademark or patent, there would be a violation of the warranty of title.

Accepted Answer

The warranty of title guarantees that the supplier has the legal right to sell the goods being delivered. If the goods violate a trademark or patent owned by someone else, the supplier does not have the legal right to sell those goods and therefore breaches the warranty of title.

Question 2

Under the UCC, for good to be merchantable means that they must be "of exceptional quality expected of an expert."

Accepted Answer

Under the UCC, for goods to be merchantable they must be "fit for ordinary purposes for which such goods are used" and have "even kind, quality, and quantity within each unit" but not necessarily "of exceptional quality expected of an expert."

Question 3

In Lee v. R&K Marine, where Lee bought a new boat from R&K that fell apart in three years, the court held the warranty disclaimer invalid because the boat failed to meet normal expectations.

Accepted Answer

The court in Lee v. R&K Marine upheld the warranty disclaimer because it was conspicuous and met the requirements under the Uniform Commercial Code, despite the boat's failure.

Question 4

A warranty is a statement or representation made by a seller that the goods being sold conform to the specified standards of quality, safety, performance and title.

Accepted Answer

This is the definition of a warranty, as it represents a promise by the seller that the product being sold meets certain standards.

Question 5

The buyer's payment for the goods under Article 2 is due when the goods leave the seller's facilities.

Accepted Answer

The payment terms are determined by the agreement between the buyer and seller in the sales contract. It is not automatic that payment is due when the goods leave the seller's facilities.

Question 6

In Lee v. R&K Marine, where Lee bought a new boat from R&K that fell apart in three years, the court held the seller not liable because the problem with the boat was caused by the manufacturer, not the seller.

Accepted Answer

In Lee v. R&K Marine, the specific details of the case, including the outcome and the parties responsible, are not provided in widely available legal databases or references, making it impossible to affirm the given statement accurately. However, generally in product liability cases, both manufacturers and sellers can be held liable for defects that cause harm, depending on the jurisdiction and specific circumstances of the case.

Question 7

Unless the parties have otherwise agreed, the buyer has a right to inspect the goods at the seller's expense before accepting or paying for them.

Accepted Answer

Under the Uniform Commercial Code (UCC), unless otherwise agreed, the buyer generally has the right to inspect the goods before payment or acceptance, but the cost of inspection is typically borne by the buyer, not the seller.

Question 8

Article 2 imposes an obligation on a merchant/seller that goods being sold are reasonably fit for the purpose for which they are being sold and that they are of fair merchantable quality.

Accepted Answer

Article 2 of the Uniform Commercial Code (UCC) imposes the obligation on a merchant/seller that goods being sold are reasonably fit for the purpose for which they are being sold and of fair merchantable quality. Therefore, the statement is true.

Question 9

Under Article 2, a seller can exclude any express or implied warranty, as long as those limits follow the rules of Article 2.

Accepted Answer

Article 2 of the Uniform Commercial Code provides guidelines for sales transactions, including warranties. According to Article 2, a seller can exclude or limit warranties, both express and implied, as long as those limitations comply with the provisions of Article 2. Therefore, the statement is true.

Question 10

Article 2 provides that unless the parties expressly agree otherwise, an implied warranty of merchantability accompanies sales by merchants.

Accepted Answer

Article 2 of the Uniform Commercial Code (UCC) provides that unless the parties expressly agree otherwise, an implied warranty of merchantability accompanies sales by merchants. This means that when a merchant sells goods, there is an implied warranty that the goods are fit for their ordinary purpose and are of at least average quality.

Question 11

During negotiations, the seller may induce the buyer to buy goods by making claims or by taking other actions. When those statements or actions relate to the quality, condition, or performance of the goods, the seller creates an implied warranty.

Accepted Answer

An implied warranty is not created by the seller's statements or actions but arises by operation of law, ensuring that goods meet certain minimum standards of quality and performance.

Question 12

If a seller knows that a buyer has a particular purpose for purchasing a good, and the buyer relies on the seller's skill or judgment in selecting a good, an implied warranty of fitness for a particular purpose may be created.

Accepted Answer

This is the definition of an implied warranty of fitness for a particular purpose. If the seller knows the buyer's purpose and the buyer relies on the seller's expertise, then the seller implicitly warrants that the good they sell is fit for that particular purpose.

Question 13

The UCC extends express warranties made to buyers to designated third parties.

Accepted Answer

According to the UCC, warranties can be assigned to designated third parties, thus extending the warranty coverage to these individuals.

Question 14

The seller has the right to default on contractual obligations by rejecting tender of goods that conforms to the contract.

Accepted Answer

The seller does not have the right to default on contractual obligations by rejecting tender of goods that conform to the contract. If the goods meet the contract requirements, the seller must accept them and fulfill their contractual obligations.

Question 15

In Lee v. R&K Marine, where Lee bought a new boat from R&K that fell apart in three years, the court held the seller had properly disclaimed all warranties, so was not liable for the problem.

Accepted Answer

The statement accurately describes the holding of the court in Lee v. R&K Marine. The court found that R&K had properly disclaimed all warranties, including implied warranties of merchantability and fitness for a particular purpose, so they were not liable for the defects in the boat that Lee experienced.

Question 16

Boilerplate language in a contract that excludes a warranty, and is inconsistent with other warranty discussion, is invalid.

Accepted Answer

Boilerplate language that excludes a warranty must be consistent with other warranty discussion in a contract, otherwise it may be deemed invalid based on legal principles of interpretation and contract law.

Question 17

Under Article 2, a warranty of title is assumed when an innocent buyer purchases stolen goods from a seller.

Accepted Answer

Under Article 2 of the Uniform Commercial Code (UCC), a warranty of title is implied, meaning the seller guarantees they have the right to sell the goods. However, if the goods are stolen, the seller cannot pass good title to the buyer, and the warranty is breached.

Question 18

If a seller delivers goods that do not conform to the contract, the buyer must accept the goods but may reduce payment by the change in value.

Accepted Answer

Under many legal systems, if goods do not conform to the contract, the buyer is not obligated to accept them and may reject the goods, seek a replacement, or demand a repair, depending on the specific terms of the contract and applicable law.

Question 19

If the buyer relies on the seller's skill or judgment to select the goods for a unique purpose, an express warranty of merchantability may be created.

Accepted Answer

An express warranty of merchantability is not created based on the buyer's reliance on the seller's skill or judgment; instead, an implied warranty of fitness for a particular purpose is created in such cases. An express warranty of merchantability simply guarantees that the goods are of average quality and are generally fit for the purpose for which such goods are used.

Question 20

During negotiations, the seller may induce the buyer to buy goods by making claims or by taking other actions. When those statements or actions relate to the quality, condition, or performance of the goods, the seller creates an express warranty.

Accepted Answer

This statement is true. When a seller makes statements or takes actions related to the quality, condition, or performance of goods, they are creating an express warranty. This is a type of warranty that is explicitly stated by the seller, as opposed to an implied warranty which arises from the circumstances of the sale.

Quiz 11: Domestic and International Sales