Question 1

In CASE 8.2,MacNeil Automotive Products,Ltd.v.Cannon Automotive,Ltd.(2010),MacNeil subcontracted with Canon Automotive to provide floor mats on automobiles.MacNeil claimed the mats were defective and breached the express warranty.What was the main question before the court?
A) Did the sales talk constitute an implied warranty for fitness of purpose?
B) Did the sales talk constitute an implied warranty of merchantability?
C) Was the sales talk puffery or an express warranty?
D) Did the sales talk properly disclaim all express warranties?

Accepted Answer

The main question before the court was whether the sales talk constituted puffery or an express warranty. MacNeil argued that the sales talk constituted an express warranty, while Cannon argued that it was merely puffery. The court had to determine whether the statements made by Cannon were specific enough to be considered an express warranty or were general and vague enough to be considered mere puffery. Ultimately, the court found that the statements made by Cannon were puffery and not an express warranty.

Question 2

For which of the following would an electronic signature be invalid under both UETA and E-Sign?
A) Contracts relating to matters of family law
B) Notices of recall
C) Contracts for foreign commerce
D) Documents accompanying the transport of hazardous materials

Accepted Answer

Both UETA and E-Sign have exceptions for certain types of contracts, including those related to family law matters. Therefore, an electronic signature would be invalid for contracts relating to such matters.

Question 3

Chris sold Whitney a home containing a wood stove which could not be removed from the home without causing substantial damage.Shortly after the sale,Whitney sustained significant smoke damage due to a malfunction of the stove.Whitney told Chris of the intention to sue under the UCC.Chris told Whitney that was not possible.Which of the following is true?
A) Chris is correct because the stove would likely be a fixture not covered by the UCC.
B) Whitney is correct because the stove would likely be a fixture covered by the UCC.
C) Whitney is correct because the stove would not be considered a fixture and would,therefore,be covered by the UCC.
D) Whitney is correct because the sale of the home would be covered under the UCC along with anything else sold with the home.

Accepted Answer

Under the UCC, fixtures are generally considered part of the real property and are not covered by the UCC. In this case, the wood stove cannot be removed from the home without causing substantial damage, suggesting that it may be considered a fixture and not covered by the UCC. Therefore, Chris is correct in saying that the UCC does not apply to the wood stove.

Question 4

Rylen develops a new type of software and asks you how to go about making money through distribution of it.Rylen has been told to sell the software as opposed to issuing licenses for its use.What should you tell Rylen?
A) By selling,rather than by licensing,a software vendor can avoid the doctrine of first sale,which allows a lawful owner to sell or otherwise dispose of the copy.
B) By licensing,rather than by selling,a software vendor can avoid the doctrine of first sale,which allows a lawful owner to sell or otherwise dispose of the copy.
C) Selling is the only reasonable alternative because computer programs are not copyrightable.
D) Licensing is the only reasonable alternative because computer programs are not copyrightable.

Accepted Answer

By licensing the software, the vendor can retain ownership rights and control over the distribution of copies. This allows for more control over the software and potential revenue streams, such as subscription models or annual renewals. Selling the software outright would give the purchaser ownership rights and the ability to dispose of copies, potentially undercutting the vendor's ability to make money off the software in the long run. Additionally, computer programs are indeed copyrightable.

Question 5

Which of the following is NOT a type of warranty under the UCC?
A) Express
B) Fitness for a particular purpose
C) Merchantability
D) Specific performance

Accepted Answer

Specific performance is not a type of warranty under the UCC. It refers to a remedy for breach of contract where a court orders the breaching party to perform their contractual obligations, rather than awarding financial damages. Express, fitness for a particular purpose, and merchantability are all types of warranties under the UCC.

Question 6

Rene owns a small restaurant that sells hamburgers as one of its main attractions and puts up a sign that says "Best Burgers in the County." Marion does an exhaustive investigation of all restaurants in the county and asks friends to do the same.They all determine that actually a restaurant run by their friend Sam has the best burgers in the county.Marion tells Rene that unless the sign is removed,Rene could be sued for breach of warranty and false advertising.Rene tells Marion no one has cause of action.Who is correct?
A) Marion is correct as long as jurors in a lawsuit can be convinced that Sam has the best burgers.
B) Marion is correct only by establishing that Rene was aware that Sam's burgers actually taste better before the sign was put up.
C) Marion is incorrect because Rene was engaged in "spoofing."
D) Marion is incorrect because Rene was engaged in "puffing."

Accepted Answer

Marion is incorrect because Rene's claim of having the "Best Burgers in the County" is a subjective statement and is considered puffery. Puffery is a promotional statement or claim that expresses subjective rather than objective views, which no reasonable person would take literally. It's a common practice in advertising and is not considered false advertising or a breach of warranty.

Question 7

In highly concentrated industries with few competitors,all the sellers may offer the same unfair contracts on a "take-it-or-leave-it" basis,known as an adhesion contract and an example of:
A) procedural unconscionability.
B) substantive unconscionability.
C) failure of underlying conditions.
D) express warranty.

Accepted Answer

This scenario is an example of procedural unconscionability, which occurs when a contract is presented to a party in a way that makes it difficult for them to negotiate or understand the terms. In this case, the sellers have a dominant position in the market and are offering standardized contracts with little room for negotiation, leaving buyers with little choice but to accept the terms or not make the purchase.

Question 8

Which of the following will NOT create an express warranty under the UCC?
A) Making a statement or promise relating to the goods.
B) Expressing an opinion about the quality of the goods.
C) Providing a description of the goods.
D) Stating any fact regarding the quality of the goods.

Accepted Answer

Expressing an opinion about the quality of the goods is not a guarantee or assurance of a fact and thus it cannot create an express warranty under the UCC.

Question 9

Panya sold Jody a used car for $1,000.Their contract provided that the engine in the car was in good shape,a true statement as far as Panya knew.Unfortunately,the day after Jody purchased the car,it broke down and was discovered to have significant engine problems.Jody wanted a refund.Panya said Jody was not entitled to a refund because Panya did not lie and had not known anything was wrong with the car.Which of the following is true?
A) Jody is entitled to a refund because of a breach of an express warranty.
B) Jody is entitled to a refund because of a breach of the implied warranty of fitness for a particular purpose.
C) Jody is entitled to a refund only by obtaining evidence that Panya lied.
D) Jody is not entitled to a refund under any circumstances because the vehicle was used.

Accepted Answer

Jody is entitled to a refund because the contract explicitly stated that the engine was in good shape, which constitutes an express warranty. When the engine was found to have significant problems, it breached this warranty.

Question 10

__________ do not relieve a contracting party from their responsibilities under the UCC doctrine of commercial impracticability.
A) Wars
B) Market fluctuations
C) Embargoes
D) Market fluctuations and embargoes

Accepted Answer

Market fluctuations do not relieve a contracting party from their responsibilities under the UCC doctrine of commercial impracticability because they are considered a normal business risk that parties should anticipate and manage.

Question 11

In a state that had adopted the Uniform Electronic Transactions Act,Kiera and Ben entered into a contract whereby Ben would clean Kiera's house once a week for eighteen months for $75 per week.The transaction was done electronically,and both Kiera and Ben signed through the use of an electronic signature.Unfortunately,problems resulted when Ben failed to show up as scheduled.Ben told Kiera that the contract was not good because his signature was made electronically.Kiera told him that he was wrong and that he needs to get up to date with the modern age.Which of the following is correct regarding the dispute?
A) Ben is correct because electronic signatures are not recognized as valid under any circumstances.
B) Ben is correct only if Kiera's name was typed as opposed to being shown in handwriting-style (cursive)form.
C) Kiera is correct that the signature is sufficient only if she can show that she and Ben had previously engaged in electronic transactions.
D) Kiera is correct that her electronic signature is sufficient.

Accepted Answer

In a state that has adopted the Uniform Electronic Transactions Act, electronic signatures and contracts are recognized as valid. Kiera and Ben both signed the contract electronically, which satisfies the requirements of the act. Therefore, Kiera is correct that her electronic signature is sufficient, and Ben's argument about the validity of electronic signatures is not valid.

Question 12

Explain the different types of warranties that exist under the UCC.

Accepted Answer

The answer of Explain the different types of warranties that...

Question 13

Indicate how a seller may disclaim warranties under the UCC.

Accepted Answer

The answer of Indicate how a seller may disclaim warranties...

Question 14

Browse-wrap agreement appears on a website and:
A) does not need to be conspicuous to be enforceable.
B) does not require the user to take any action to express consent to the agreement.
C) prevents use of any software until the license agreement is clicked.
D) acts as an application for licensed use of the software.

Accepted Answer

A browse-wrap agreement is a type of contract that appears on a website and does not require users to take any action to express consent to the agreement. This is in contrast to a click-wrap agreement, which requires users to click "I Agree" or a similar button to indicate their acceptance of the terms. However, the browse-wrap agreement still needs to be reasonably conspicuous on the website in order to be enforceable.

Question 15

The courts that have considered click-wrap licenses have generally found that the licenses are
A) enforceable.
B) enforceable only for software costing $100 or less.
C) enforceable only for software costing $100 or less and that is designed for business,not consumer use.
D) unenforceable.

Accepted Answer

Courts have generally found click-wrap licenses to be enforceable, as users are given notice of the terms and conditions before clicking "I agree" and are free to reject the terms if they do not agree with them.

Question 16

If the contracted goods are unique and fail to be delivered,the buyer can ask a court under 2-716 of the UCC to order:
A) allocation of risk of loss.
B) consequential damages.
C) cover.
D) specific performance.

Accepted Answer

If the contracted goods are unique, there may not be a suitable substitute available on the market (i.e. cover may not be an option). In this case, the buyer can ask the court for a remedy of specific performance, which would require the seller to provide the unique goods as agreed upon in the contract.

Question 17

With a shrink-wrap license,the user will:
A) not find the licensing terms in a conspicuous place.
B) agree to the terms of the license by clicking on an icon.
C) find the license terms on the outside of a box containing software.
D) not need to take any action to express consent to the agreement.

Accepted Answer

Shrink-wrap licenses typically have the license terms printed on the outside of the software packaging, and by opening the package, the user is considered to have agreed to the terms.

Question 18

Under 2-711 of the UCC,a buyer has a remedy called "cover." What is cover and when can it be used?
A) Cover applies when conforming goods are rejected by the buyer,giving the buyer the right to cancel the contract and buy better goods elsewhere with reimbursement for any extra costs.
B) Cover applies when nonconforming goods are delivered to the buyer,giving the buyer the right to cancel the contract and buy the goods elsewhere with reimbursement for any extra costs.
C) Cover is a seller's right and does not apply to the buyer.
D) Cover allows a buyer to cancel the contract for shipments delayed more than 30 days and recover direct damages from the seller.

Accepted Answer

Cover is a remedy for the buyer when nonconforming goods are delivered. It allows the buyer to purchase substitute goods from a different seller and recover any extra costs incurred from the original contract. This remedy is intended to protect the buyer from losses due to the seller's breach of contract.

Question 19

Between merchants,what is the effect of an acceptance that includes additional terms without expressly making the contract subject to the offeror's agreeing to those terms?

Accepted Answer

The answer of Between merchants,what is the effect of an...

Question 20

Which of the following is true regarding the UETA in relation to the E-Sign Act?
A) Because the UETA is a federal law,whereas the E-Sign Act is a creature of state law,the UETA preempts the E-Sign Act in many ways.
B) The UETA and also the E-Sign Act exclude wills from their coverage.
C) Both the UETA and the E-Sign Act include within their broad scope provisions that divorces may be entered into and recorded electronically.
D) The UETA allows electronic signatures whereas the E-Sign Act disallows such signatures.

Accepted Answer

The UETA (Uniform Electronic Transactions Act) and the E-Sign Act (Electronic Signatures in Global and National Commerce Act) both exclude wills from their coverage, ensuring that traditional, non-electronic methods are used for these sensitive documents. Contrary to the other options, the UETA is not a federal law but was proposed by the Uniform Law Commission for states to adopt, aiming to harmonize state laws on electronic transactions, while the E-Sign Act is a federal law ensuring the validity of electronic signatures across the U.S. Both acts support the use of electronic signatures and records in commerce, not limiting or disallowing them.

Quiz 8: Sales Licensing and-E Commerce

In CASE 8.2,MacNeil Automotive Products,Ltd.v.Cannon Automotive,Ltd.(2010) ,MacNeil subcontracted with Canon Automotive to provide floor mats on automobiles.MacNeil claimed the mats were defective and breached the express warranty.What was the main question before the court?

For which of the following would an electronic signature be invalid under both UETA and E-Sign?

Rylen develops a new type of software and asks you how to go about making money through distribution of it.Rylen has been told to sell the software as opposed to issuing licenses for its use.What should you tell Rylen?

Which of the following is NOT a type of warranty under the UCC?

In highly concentrated industries with few competitors,all the sellers may offer the same unfair contracts on a "take-it-or-leave-it" basis,known as an adhesion contract and an example of:

Which of the following will NOT create an express warranty under the UCC?

__________ do not relieve a contracting party from their responsibilities under the UCC doctrine of commercial impracticability.

Explain the different types of warranties that exist under the UCC.

Indicate how a seller may disclaim warranties under the UCC.

Browse-wrap agreement appears on a website and:

The courts that have considered click-wrap licenses have generally found that the licenses are

If the contracted goods are unique and fail to be delivered,the buyer can ask a court under 2-716 of the UCC to order:

With a shrink-wrap license,the user will:

Under 2-711 of the UCC,a buyer has a remedy called "cover." What is cover and when can it be used?

Between merchants,what is the effect of an acceptance that includes additional terms without expressly making the contract subject to the offeror's agreeing to those terms?

Which of the following is true regarding the UETA in relation to the E-Sign Act?