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EXAM 4 - BUS LAW (FINAL) ***Neal
Terms in this set (62)
UCC (Uniform Commercial Code)
Body of laws governing commercial transactions in the United States.
article two - sales contracts
article two deals with the sale of goods. it does not deal with real property, services, o intangible property such as stocks and bonds. thus, if the subject matter if a dispute is goods, the UCC governs. if it is real estate or services, the common law applies.
in some situations, the rule can vary depending on whether the buyer or the seller in a merchant
the passing of title from the seller to the buyer for a price
goods associated with real estate
EX. homeowners in CO installed an underground radiant heating system to warm indoor flooring or melt snow or ice under driveways and sidewalks. the system began to leak as a result of a hose called Entran II. the homeowners sued Goodyear tire and Rubber Company, the maker of the hose, asserting claims under CO version of the UCC. The court held that because the hose was a tangible and movable good at the time the contract was made, it was a "good" under the UCC. therefore, the UCC applied to the contract even though the hose was later incorporated into real property.
Who is a merchant?
1. a merchant is a person who deals in goods of the kind involved in the sales contract.
2. ta merchant is a person who, by occupations, holds himself or herself out as having knowledge and skill unique to the practices or goods involved in the transactions.
3. a person who employs a merchant as a broker agent or other intermediary has the status of a merchant in that transaction
In regard to the lease of goods, an agreement in which one person (the lessor) agrees to transfer the right to the possession and use of property to another person (the lessee) in exchange for rental payments.
Consumer leases involves 3 elements:
1. lessor who regularly engages in the business of leasing or selling
2. a lessee who leases the goods "primarily for a personal, family, or household purpose"
3. Total lease payment that is less than $25000
the UCC states that a sales or lease contract will not fail for indefiniteness even if one or more terms open as long as both of the following are:
1. the parties intended to make a contract
2. there is a reasonably certain basis for the court to grant an appropriate remedy
duration of an ongoing contract
a single contract might specify successive performances but not indicate how long the parties are required to deal with each other
options and cooperation wot regard to performance
petty drugs agree to purchase one thousand toothbrushes from Marconi's dental supply. the toothbrush comes in a variety of colors, but the contract does not specify color.
requirements for a firm offer
2. signed by the offeror
made in a reasonable manner and by reasonable means
sufficiency of the writing
1. indicates that the parties intended to form a contract
2. is signed by the party against whom enforcement is sought
specially manufactured goods
an oral contract for specially manufactured goods is enforceable
1. the goods are specially manufactured for a particular buyer or specially manufactured or obtained for a particular lessee
2. the goods are not suitable for resale or lease to others in the ordinary course of the sellers or lessors business
3. the seller or lessor has substantially started to manufactured the goods or has made commitments for the manufacture or procurement of the goods
fully integrated contract
cannot be contradicted by evidence of any prior agreements or contemporaneous oral agreements
course of dealing
a sequence of actions and communications between the parties to a particular transaction that establishes a common basis for their understanding
course of performance
the conduct that occurs under the terms of a particular agreement
Rules of Construction
1. express terms
2. course of performance
3. course of dealing
4. usage of trade
1. refuse to enforce the contract
2. enforce the remainder of the contract without the unconscionable apart
3. limit the application of the unconscionable term to avoid an unconscionable result
takes place when specific goods are designated as the subject matter of a sales or lease contract
A contract for the sale of goods in which the seller is required or authorized to ship the goods by carrier. The seller assumes liability for any losses or damage to the goods until they are delivered to the carrier.
A contract in which the seller is required to ship the goods by carrier and deliver them at a particular destination. The seller assumes liability for any losses or damage to the goods until they are tendered at the destination specified in the contract.
document of title
An actual piece of paper, such as a warehouse receipt or bill of lading, that is required in some transactions of pickup and delivery.
voidable terms - the payer is unable to fulfill his duties (most too young)
buyer in the ordinary course of business
1. she or he buys goods in good faith
2. the goods are purchases without knowledge that the sale violates the right of another person in the goods.
3. the goods are purchased in the ordinary course form a merchant in the business of selling goods of that kind
4. the sale to that person comports with the usual or customary practices in the kind of business in which the seller is engaged
the transfer of possession but not the title of personal property by one party to another, under agreement
when risk of loss passes
1. the buyer receives a negotiable documentation of title for the goods
2. the bailee acknowledges the buyer's right to possess the goods
3. the buyer receives a non-negotiable documentation of title, and the buyer has had a reasonable tie to present the document to the bailee and demand the goods. if the bailee refuses to honor the document, the risk of loss remains with the seller
sale or return
Buyer has the option to return the goods
When the Seller or Lessor Breaches
1. the defects are cured
2. the buyer accepts the goods in spite of their defects
when the buyer or lessee breaches
1. the seller of lessor must have already identified the contract goods
2. the buyer or lessee bears the risk for an only commercially reasonable time after the seller or lessor has learned for the breach
3. the buyer or lessee is liable only to the extent of any deficiency in the sellers ort lessors insurance coverage
something of value that, if lost, would cause you financial harm
place of delivery
- Seller's place of business
- Seller's residence
- Location of the goods
1. place of good into the hands of the carrier
2. make a contract for their transportation that is reasonable according to the nature of the goods and their value
3. obtain and promptly deliver or ender to the buyer any documents necessary to enable the buyer to obtain possession of the goods from the carrier
4. promptly notify the buyer that shipment has been made
perfect tender rule
the requirement that the goods delivered exactly meet the contractual specifications
the right of the seller or lessor to repair, adjust, or replace defective or nonconforming goods
1. a delivery is rejected because the goods were nonconforming
2. the time for performance has not yet explained
3. the seller or lessor provides timely notice to the intention to cure
4. the cure can be made within the contract time for performance
destruction of identified goods
if the goods were identified at the time the contract was formed, the parties are excused from performance
in the absence of any specific agreements, the buyer or lessee must make payments at the time and place the goods are achieved
right of inspection
allows the buyer or lessee to verify that the goods or tendered or delivered conform to the contract
1. the buyer or lessee indicates to the seller or lessor that the goods are conforming or that he or she will retain them in spite of their nonconforming
2. the buyer or lessee fails to reject the good within a reasonable period of time
3. in sales contracts, the buyer will be deemed to have accepted the goods if he or she performs any act inconsistent with the seller's ownership.
Suspension of performance obligations
1. treat the repudiate as a final breach by pursuing a remedy
2. wait to see if the repudiation party will decide to ho9nor the contract despite the avowed intention to renege
when the goods are in the possession of the seller or lessor
2. resell the goods and sue to recover damages
3. sue to recover the purchase price or lease payments due
4. sue to recover damages for the buyer's nonacceptance of goods
when the goods are unfinished
1. cease manufacturing the goods and resell them for scrap or salvage value
2. complete the manufacture and resell or dispose of the goods and hold the buyer or lessor liable for any deficiency
requirements for stopping the delivery
1. the buyer or lessee receives the goods
2. the carrier or the bailee acknowledges the rights of the buyer or lessee in the goods
3. a negotiable document of title covering the goods has been properly transferred tot eh buyer in a sales transaction, giving the buyer ownership rights in the goods
when the seller or lessor refuses to deliver the goods
1. cancel the contract
2. obtain goods that have been paid for if the seller or lessor is insolvent
3. sue to obtain specific performances if the goods are unique or if damages are an inadequate remedy
4. buy other goods and recover damages from the seller
5. sue to obtain identified goods held by a third party
6. sue to obtain damages
Three types of title warranties
good title, no liens, no infringements
title acquired from someone who already owns the goods free and clear
The warranty protects buyer who, for instance, unknowingly purchases goods that are subject to a creditor's security interests.
A third type of warranty of title arises automatically when a merchant-seller or lessor warrants that the buyer or lessee takes the goods free of infringements from any copyright, trademark, or patent claims of a third person
statement that create express warranties
1. the good conforms to any affirmation of fact or promises that the seller or lessor makes to the buyer or lessee about the goods
one that the law derives by inference from the nature of the transactions or the relative situations or circumstances of the parties
Implied Warranty of Fitness for a Particular Purpose
1. the particular purpose for which a buyer or lessee will use the goods
2. that the buyer or lessee is relying on the skill and judgment of the seller or lessor to select suitable goods
1. Express warranties displace inconsistent implied warranties, except implied warranties of fitness for a particular purpose.
2. Samples take precedence over inconsistent general descriptions.
3. Exact or technical specifications displace inconsistent samples or general descriptions.
The actual and definite statement of a seller, either orally or in writing, at the time of the sale.
person may be held liable if they use their property in a manner that unreasonably interferes with others' rights to sue or enjoy their own property
lawsuits for personal injuries caused by exposure to a toxic substance
environmental regulatory agencies
Primary federal agency is the EPA. All federal agencies must take the environmental impact into account when making significant decisions
Environmental Impact Statement
Statement required by Federal law from all agencies for any project using Federal funds to assess the potential affect of the new construction or development on the environment.
1. the impact on the environment that the action will have
2. any adverse effects on the environment that the action will have
3. any irreversible effect the action might generate
permit system under the CWA includes the following elements
1. national effluent standards set by the EPA for each industry
2. water quality standards set by the sets by the EPA supervision
3. a discharge permit program that sets water quality standards to limit pollution
4. special provisions for toxic chemicals and for oil spills
5. construction grants and loans from the federal government for publicly treatment works, primarily sewage treatment plants
those areas that are inundated or saturated by surface or ground water at a frequency and duration sufficient to support ... vegetation typically adapted for life in saturated soil conditions
established by Congress in 1980, a fund devoted to cleaning up toxic waste supported by taxes on toxic waste.
potentially responsible parties
1. the person who generated the wastes disposed of at the site.
2, the person who transported the waste to the site
3. the person who owned or operated the site at the time of the disposal
4. the current owner or operator
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