4) Gap-Fillers, Interpretation, Parole Evidence Rule

Question 1

UCC implied warranties: result

Answer 1

default rule – applies unless conditions met to negate

Question 2

UCC implied warranties: kinds

Answer 2

1) title
2) merchantability
3) fitness for particular purpose

Question 3

UCC implied warranty of TITLE: def

Answer 3

implied warranty of:

1) good title to the goods
2) rightful transfer
3) no liens/etc

Question 4

UCC implied warranty of TITLE: how to negate

Answer 4

1) specific language OR

2) circs that give buyer reason to suspect seller dnh unencumbered title

Question 5

UCC implied warranty of MERCHANTABILITY: def

Answer 5

implied warranty that goods fit for ordinary purpose.

ONLY APPLIES IF SELLER IS MERCHANT

Question 6

UCC implied warranty of TITLE: when apply?

Answer 6

always, unless negated

Question 7

UCC implied warranty of merchantability: when apply?

Answer 7

only if seller is merchant (and not negated)

Question 8

UCC implied warranty of MERCHANTABILITY: how to negate

Answer 8

1) specifically say “merchantability.” If in writing must be conspicuous, OR
2) other lang or circs that would be reasonably understood by buyer to exclude

Question 9

UCC implied warranty of MERCHANTABILITY: exs of lang or circs that would be reasonably understood by buyer to exclude the warranty

Answer 9

1) “as is”

2) patent defects

Question 10

UCC implied warranty of FITNESS FOR PARTICULAR PURPOSE: def

Answer 10

goods being sold are fit for particular purpose (not ordinary purpose) that buyer wants to use them for

(conditions)

Question 11

UCC implied warranty of FITNESS FOR PARTICULAR PURPOSE: when apply?

Answer 11

at time of k, seller has reason to know:

1) the particular purpose AND
2) buyer is relying on seller’s expertise to select reasonable goods

Question 12

UCC implied warranty of FITNESS FOR PARTICULAR PURPOSE: how to negate?

Answer 12

1) disclaimer is written, clear, and conspicuous OR

2) goods have easily detectable patent defects

Question 13

UCC express warranty: def

Answer 13

warranty that goods will conform to some standard, arises whenever seller expressly makes it part of basis of the bargain

Question 14

UCC express warranty: ways to make one

Answer 14

1) affirmation of promise or fact
2) description of the goods
3) sample/model

Question 15

UCC express warranty: exception

Answer 15

sales puffery not a warranty! (is st vague, or a falsifiable fact?)

Question 16

UCC default rules for missing terms: can still have a k if any of these terms are missing

Answer 16

1) price
2) time
3) place of delivery

Question 17

UCC default rule for missing term: price. what’s filled in?

Answer 17

reasonable price (market value) at time established by k for delivery

Question 18

UCC default rule for missing term: time. what’s filled in?

Answer 18

reasonable time

Question 19

UCC default rule for missing term: place of delivery. what’s filled in?

Answer 19

seller’s place of business

Question 20

CL default rule for missing price term

Answer 20

if a SERVICES K –> reasonable value for services rendered

Question 21

good faith and fair dealing: UCC or CL?

Answer 21

both!

Question 22

GF: result

Answer 22

can be source of gap filling re. performance, enforcement

Question 23

GF: def

Answer 23

1) honesty in fact AND

2) observance of reasonable commercial standards of fair dealing in the trade

Question 24

good faith obligation triggered when:

Answer 24

terms of k leave critical term:
1) price
2) satisfaction clause
3) quantity
open to the determination of ONE PARTY

Question 25

satisfaction clause: def

Answer 25

k says performance only complete when recipient is satisfied

Question 26

satisfaction clause: is it illusory?

Answer 26

no --> doesn't trigger the "if I feel like it" bc of addition of GF requirement

Question 27

are open quantity terms allowed?

Answer 27

UCC yes, CL no

Question 28

open quantity term: 2 kinds

Answer 28

1) output k | 2) requirements k

Question 29

output k: def

Answer 29

buyer agrees to buy all, or a %, of seller's output of a particular good

Question 30

requirements k: def

Answer 30

seller agrees to supply buyer w all or % of buyer's requirements for particular good

Question 31

UCC open quantity term: GF requirement

Answer 31

the party that can determine the quantity (seller who said would sell ALL I make or buyer who said give me ALL I need): 1) must make determination in GF AND 2) no unreasonably disproportionate demand or tender, IF there was an estimate or past course of dealing

Question 32

UCC open quantity term "no unreasonably disproportionate" applies if:

Answer 32

1) stated estimate OR | 2) past course of dealing

Question 33

interpreting ambiguous language: consider these doctrines

Answer 33

1) objective vs subjective | 2) contra preferenem

Question 34

objective vs subjective: def

Answer 34

in interpreting ambiguous k, objective language trumps subjective meaning

Question 35

objective vs subjective: exception

Answer 35

if 1 party has reason to know of other party's subjective understanding, then 1st party is bound by that meaning

Question 36

contra preferenum: def

Answer 36

in interpreting ambiguous k, construe the ambiguous term against the drafter

Question 37

contra preferenum: scope

Answer 37

--applies to all ks, but courts may not use this rule in every case

Question 38

interpreting ambiguities, filling gaps: consider these possible sources of extrinsic evidence

Answer 38

1) trade usage 2) course of dealing 3) course of performance 4) parol evidence rule (re pre-k coms btwn the 2 parties)

Question 39

extrinsic evidence: def

Answer 39

outside the 4 corners of the k

Question 40

admissible to use extrinsic evidence for:

Answer 40

1) interpret ambiguities 2) fill gaps 3) UCC ONLY: add additional terms (even if completely integrated agreement)

Question 41

trade usage (def)

Answer 41

practice so regularly observed in a place/trade that it justifies expectation that it will be observed re this transaction (what all members of the trade do)

Question 42

course of dealing (def)

Answer 42

pattern of conduct in previous transactions btwn these parties that is fairly regarded as common basis of understanding for subsequent conduct (same parties, previous k)

Question 43

course of performance (def)

Answer 43

multiple occasions for performance under this k and other party, knowing of nature of performance and had opportunity to object, accepts the performance (same parties, same k)

Question 44

inadmissible use of extrinsic evidence

Answer 44

contradict express terms of the k

Question 45

ranking of kinds of extrinsic evidence

Answer 45

if in conflict, priority = 1) course of performance 2) course of dealing 3) usage of trade

Question 46

parol evidence rule: scope

Answer 46

applies to admissibility of: 1) oral or documentary evidence 2) of negotiations or other communications 3) between the parties 4) BEFORE or CONTEMPORANEOUS w the (written) k

Question 47

PER: integration: kinds

Answer 47

1) partial 2) complete 3) (not at all)

Question 48

PER: partial integration: def

Answer 48

terms in the k are INTENDED as final expression OF THOSE TERMS

Question 49

PER: complete integration: def

Answer 49

the k is intended to be complete, exclusive statement of all terms

Question 50

PER: how to know if partial or complete integration? majority rule

Answer 50

merger clause = complete integration

Question 51

merger clause: def

Answer 51

says that the writing is complete, entire agreement

Question 52

PER: how to know if partial or complete integration? minority rule

Answer 52

merger clause is persuasive but also consider other evidence to decide whether parties intended the k to bar the evidence now proposed

Question 53

PER: rule re. explaining or interpreting terms of written k

Answer 53

parol evidence ALWAYS admissible for this (majority)

Question 54

PER: rule re. supplementing terms of written k (add a term)

Answer 54

parol evidence admissible for this purpose UNLESS k is completely integrated

Question 55

if agreement is completely integrated, can external non-PER evidence (trade/course d / course p) supplement it?

Answer 55

UCC: yes CL: no

Question 56

PER: rule re. contradicting terms of written k

Answer 56

parole evidence NOT admissible for this (unless not integrated re. that term)

Question 57

PER: rule re. using PER to decide if it's integrated or not

Answer 57

always ok use the PER for this

Question 58

PER Exceptions (times PER does not apply)

Answer 58

1) subsequent agreements 2) collateral agreements 3) attack on validity of written agreement

Question 59

PER exception: subsequent agreement: rationale

Answer 59

the whole point of PER is it's about prior / contemporaneous evidence --> this is outside the def

Question 60

PER exception: collateral agreement: def

Answer 60

PER does not affect agreements that are entirely distinct from the written k at issue (even if same transaction--car sale vs parking)

Question 61

PER exception: attack on validity of written agreement: rationale

Answer 61

if you're arguing k not enforceable for one of these reasons, the evidence can come in for your argument. (PER requires a valid written agreement, unlike here)

Question 62

PER exception: attack on validity of written agreement: kinds

Answer 62

1) failure of oral condition precedent to agreement 2) mistake or duress 3) fraud 4) reformation

Question 63

PER exception: failure of oral condition precedent to agreement

Answer 63

tricky bc normally prior written stuff falls under PER. But PER DOES NOT APPLY and can't exclude evidence if it was a condition precedent, such that there was no agreement at all if not met

Question 64

reformation: steps

Answer 64

A P trying to get reformation must show: 1) antecedent valid agreement 2) AA is incorretly reflected in the writing bc of mistake or fraud, AND 3) proof is established by clear/convincing evidence