Sales Flashcards
When does a firm offer exist under UCC?
When all three are met: SUM Signed Up to 3 months Merchant
What are differences in contracts under UCC versus common law?
Additional consideration not required
Offer terms can be vague, only need type and quantity of goods
Acceptance can have minor variations
What is a shipment contract?
Title and risk of loss transfer when place with common carrier
FOB - Free on board shipping point (seller’s warehouse)
What is a destination contract?
Title and risk of loss transfer when tendered to buyer
FOB - Free on board destination (buyer’s warehouse)
What are title and risk of loss transfer based on?
1) Contract terms
2) If no contract terms, then shipping terms
3) If buyer picks up goods:
Title passes when contract formed
Risk of loss passes when merchant goods received by buyer, non merchant goods tendered to buyer
When does title and risk of loss transfer in sale on approval?
Transfers to buyer once they have accepted goods explicitly or time period has elapsed
When does title and risk of loss transfer when buyer rejects delivery or revokes acceptance?
Title immediately goes back to seller
Risk of loss - depends on party in breach
What is Implied Warranty of Title and Infringement?
Automatically exists in all sales
Seller warrants good title, no liens, etc.
Disclaimer must be explicit in contract
What is Express Warranty?
Any statements that become “basis of bargain” such as description, sample, or model
Cannot be disclaimed
What is Implied Warranty of Merchantability?
Seller warrants goods are fine for ordinary purpose
Seller must be merchant
Disclaimer must say “as is” or “with all faults”
Can be oral or in writing
What is Implied Warranty of Fitness?
Buyer relies on seller’s judgment in selecting item
Disclaimer must say “as is” or “with all faults”
Must be writing
What must injured party prove in product liability?
Suffered injury
Seller was in business of selling that product
Product was sold in defective condition
Defect made product unreasonably dangerous
What is a seller liable under product liability regardless of?
Unaware of defect
Injured party’s negligence
Not in privity with injured party
Cannot disclaim product liability
