Goods specifically earmarked for a particular sales contract

Consolidated Chemical Industries purchased three heat exchangers from Falls Industries in Cleveland. The contract specified that after identification the machines were to be crated securely. They were then to be delivered, without breakage, to the Consolidated plant in East Baton Rouge. Because the machines were not crated securely, the exchangers were badly damaged in transit. Consolidated refused to accept them, and Falls sued. Falls claimed that risk of loss had passed when the goods were delivered to the carrier. Do you agree? (Falls Industries, Inc. v. Consolidated Chemical Industries, Inc., 258 F.2d 277)

Lane had a boat dealership in North Carolina. In February, he sold a new boat, a 120-HP motor, and a trailer to a man who represented himself to be “John Willis.” Willis gave Lane a check for $6,285 and left with the goods. The check proved to be worthless. Less than six months later, Honeycutt bought the three items in South Carolina from a man whom he had known for several years as “John R. Garrett.” In fact, this was Willis, using an alias. Later, while searching for Willis under the alias of “John Patterson,” the Federal Bureau of Investigation contacted Honeycutt. Honeycutt said that (a) he had paid a full price of only$2,500; (b) Garrett had nothing to show he was the owner; (c) he did not know from whom Garrett got the boat; (d) Garrett said he was selling the boat for someone else; (e) Garrett signed what he called a “title” (the document was nothing more than a “Certificate of Number” issued by the state Wildlife Resources Commission, not the “certificate of title” required by statutes); (f) Garrett forged the signature of the purported owner, John F. Patterson, on the so-called title. Plaintiff Lane now claims that defendant Honeycutt was not a good-faith purchaser and therefore should return the boat to him, with damages for a wrongful detention. Who has title to the boat? You decide. (Lane v. Honeycutt, 188 S.E.2d 604, N.C)

When his company developed financial trouble, Pais, a member of the legal staff, was suddenly transferred from Houston, Texas, to company headquarters in New York City. As a consequence, he bought with cash $50,000 worth of new Danish furniture for his apartment on Park Ave. When the furniture was tendered by the seller before the apartment was ready, Pais had to ask them to keep it in their warehouse in the Bronx. In the meantime, his employer had to suspend salary payments for a month. Pais sought to use the furniture as collateral for a loan. Did he have title to it even though he had not taken possession?

Trina’s boyfriend, Serge, asked her over one summer evening to watch a movie on his deck using his new HD DVD projector and screen. Serge had been supplied the projector and screen through a sale on approval from BrightLite Industries. When Trina arrived, she and Serge decided to drive to the local grocery store to pick up some food and drink for their “night at the movies.” While they were gone a rainstorm came up and destroyed the projector and screen. Who typically has the risk of loss in this type of sales transaction? Why? Who must bear the loss in this particular case? Why?

Shortly after her lawsuit against the computer company was resolved, Trina took her new laptop into a computer store for needed repairs. When Trina returned to pick it up, she found it had been sold by one of the store’s salespeople to an innocent purchaser. Evidently, due to a bookkeeping error and its mint condition, Trina’s laptop had been shelved with the store’s regular stock after being repaired and was snapped up by the first customer who saw it. Before Trina’s attorney could bring suit against the shop, it went out of business. She then sued to recover the laptop from the customer who purchased it from the store. Who won and why?

Why are the Prairie Provinces so important to the Canadian economy?

Shortly after her lawsuit against the police department was resolved, Trina decided to buy a new laptop from a 1-800 phone order seller. As Trina and the seller agreed, the seller shipped Trina’s new computer to a warehouse near Trina’s home. The warehouse then notified Trina to come and pick up the computer. Through no fault of the warehouse, the computer was drenched with water and rendered inoperable during a minor fire. Trina tried to return the computer to the seller for a new one, saying that the seller had to bear the loss. The company refused to accept the return. Trina sued the computer company for her money back or another computer. Who won and why?

Trina, a computer programmer, had her laptop computer stolen. She reported what had happened to the police and gave them its serial number. Three months later, the police recovered a laptop that was the same make and model as Trina’s, but the serial number had been removed. Trina tried to obtain the computer from the police, but they declined her request. They put the computer up for sale at the next police auction. Trina sued to recover what she thought to be her computer. Who won and why?

If a buyer properly rejects faulty goods, the risk of loss stays with the seller until the defects are corrected. True or False?

If an owner of goods is induced by fraud to sell the goods, the transfer of title is ? by the seller. (a) valid (b) voidable (c) void

What legal theory prompted you to answer question 1 as you did?

Goods that are not both existing and identified

Interview businesses in your area that buy and sell internationally. Prepare a report on problems they have encountered in making their orders and billings clear to their trading partners. Try to find trading partners who speak a variety of different languages.