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Flashcards in Contracts: Application & Formation Deck (10)
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1

UCC Article 2:
Application

- covers sales of goods
- Predominant Purpose Test:
- if service & goods, use primary purpose
- If realty & goods: is it a fixture?
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2

UCC Article 2:
Bailments

Transfer of personal property but not title

3

UCC Article 2:
Good Faith

Definition: Obligation to act with forthrightness and fairness in the formation, performance, and modification of their contracts.
Goal: produce smooth transactions and minimize unnecessary expenses in forming contracts and handling failures to perform.

4

UCC Article 2:
Formation

- certainty and definiteness of terms is less stringent under the UCC
- States subject matter and and quantity of goods
- Open price term: reasonable/market price at delivery
- Open Payment term: payment due goods received
- Open Place term: sellers business or residence
- Open time: whatever's reasonable
- Open Quantity:

5

UCC Article 2: Firm Offer

- Made by a merchant
- Gives assurance it wont be withdrawn
- In writing
- irrevocable without consideration paid

6

UCC Article 2:
Acceptance by shipment

- delivers conforming goods to carrier
- accept by promising to ship promptly
- if good are different, notify before shipment (to be a accommodation)
- otherwise acceptance and automatic breach

7

UCC Article 2:
Additional Terms Battle of Forms

Common Law: Mirror image rule: no changes
UCC Article 2: depends on whether parties are merchants, terms are material, the offer is limited, the offeror objects)

8

UCC Article 2:
Modification

- Agreement to modify terms does not require consideration.
- May have to be in writing if under statute of frauds
- must be in good faith
- if both parties agree there is a modification

9

UCC Article 2:
Unconscionable contract or clause

- follows common law that if it hurts the conscience of society it is unenforceable

10

UCC Article 2:
Statute of Frauds

Contracts for the sale of goods $500 or more must be in writing unless:
- Between merchants
- Special ordered contracted goods
- Admission under oath
- Buyer's performance
- Permits piece-meal "writing"

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