[Lucky Morton] Morton,who owns 500 acres of land in east Texas,has just discovered oil under his property.He calls OilEx,who wants to buy all of the oil from Morton's property.Morton is thrilled about the money he will make from selling the oil and he signs a contract allowing OilEx to set up a drilling station on his property.Thinking he can get more money off his land,Morton cuts down all of his trees with a chainsaw and then sells them to PaperCo to be made into paper.Meanwhile,Morton's neighbor offers to buy Morton's wheat crop after it is harvested in the Fall,and Morton agrees.
-Is Morton's contract with OilEx likely covered by the UCC?
A)No,because Morton has sold OilEx the right to come onto his property and remove the oil,which is not covered by the UCC.
B)Yes,because oil is considered a good.
C)Yes,but only if it is over $500 in value and in writing.
D)No,because oil is considered part of the land and land sales are not covered by the UCC.
E)Yes,because the oil is a fixture,which is being removed from the ground and sold.

Question

Quizplus · Accepted Answer

A)Items taken from real estate may be treated as goods.Minerals,clay,and soil can all be treated as goods,with their sales contract governed by Article 2,if the owner takes these items out of the ground and then sells them to the buyer.
Should the owner sell the buyer the right to come and remove the items,the contract would be governed not by the UCC but by common law for the sale of an interest in realty,in this case,an interest known as a "profit."
B)Items taken from real estate may be treated as goods.Minerals,clay,and soil can all be treated as goods,with their sales contract governed by Article 2,if the owner takes these items out of the ground and then sells them to the buyer.Should the owner sell the buyer the right to come and remove the items,the contract would be governed not by the UCC but by common law for the sale of an interest in realty,in this case,an interest known as a "profit."
C)Items taken from real estate may be treated as goods.Minerals,clay,and soil can all be treated as goods,with their sales contract governed by Article 2,if the owner takes these items out of the ground and then sells them to the buyer.Should the owner sell the buyer the right to come and remove the items,the contract would be governed not by the UCC but by common law for the sale of an interest in realty,in this case,an interest known as a "profit."
D)Items taken from real estate may be treated as goods.Minerals,clay,and soil can all be treated as goods,with their sales contract governed by Article 2,if the owner takes these items out of the ground and then sells them to the buyer.Should the owner sell the buyer the right to come and remove the items,the contract would be governed not by the UCC but by common law for the sale of an interest in realty,in this case,an interest known as a "profit."
E)Items taken from real estate may be treated as goods.Minerals,clay,and soil can all be treated as goods,with their sales contract governed by Article 2,if the owner takes these items out of the ground and then sells them to the buyer.Should the owner sell the buyer the right to come and remove the items,the contract would be governed not by the UCC but by common law for the sale of an interest in realty,in this case,an interest known as a "profit."

[Lucky Morton] Morton,who Owns 500 Acres of Land in East