Contracts: Article 2 Remedies Flashcards Preview

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Flashcards in Contracts: Article 2 Remedies Deck (8)
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1

UCC Article 2:
Seller's Remedies:
Still have Goods

Sellers who still have the Goods:
- Identify goods to contract (can complete in-process)
- Withhold delivery & demand cash
- Cancel and/or rescind the contract. Notify. Proceed with remedies below
- Resell goods
- reasonably commercial manner
- give buyer notice private/public sale
- sale conducted @ reasonable time & place
- Sue for Breach of Contract
- (market @ tender - unpaid contract $)+ costs
- Retain Buyer's Deposit

2

UCC Article 2:
Seller's Remedies:
Goods In-Transit

Goods are in-transit
Buyer is Insolvent:
- stop shipment and recover 10 days after delivery
- if misrepresented 90 days prior, no time limit
Buyer is not Insolvent:
- stop large shipments (cars, trucks, planes)
Stop shipment at any time
- don't give document of title

3

UCC Article 2:
Seller's Remedies:
Buyer has Posession

- if buyer got goods on credit while insolvent, 10 days
- compensatory damages: purchase price + incidentals

4

UCC Article 2:
Buyer's Remedies:
Seller Fails to Deliver

Cancel & Rescind:
- restore both to original position
Cover:
- buy similar and recover difference in cost from seller plus incidental damages
Sue for Breach of Contract:
- lawsuit
- damages: (market $ @ Breach - contract $)+Incidental
Specific Performance
- only if goods are unique (cover not available)
- rarely used for land under UCC, often under CL
- rarely damages
Replevin
- seller refuses to tender delivery after goods identified
- file a suit requiring seller to give goods to buyer
- rare (no cover)

5

UCC Article 2:
Buyer's Remedies:
Non-confirming goods

Similar Options:
- cancellation
- cover
- breach of Contract
- replevin
- keep goods and recover difference in value

6

UCC Article 2:
Buyer's Remedies:
Buyer Accepts Non-confirming goods

*** must give notice that goods are nonconforming***
- Recover ordinary damages
- Recover for breach of warranty (difference in cost plus incidentals)
- Deduction of damages from purchase price still due. Note "Payment in Full"

7

UCC Article 2:
Buyer's Remedies:
Liquidated Damages
Recovery of Payment

Liquidated Damages
- Parties agreed to predetermined amount of damages. amount must be reasonable
- if amount is a penalty it is void
Recovery of Payment
- buyer makes payment & becomes insolvent in 10 days, and goods are identified. Tender balance owed.

8

UCC Article 2:
Limitations on Remedies

Contract Limitation
- limit or add other remedies to the contract
Installment Contract
- breach of an installment is not a breach of whole contract
- buyer's remedies limited to that contract
Statute of Limitations
- file within 4 years of cause of action
- Parties can agree to lessen to period not less than one year
- breach of warranty, cause of action begins at tender of delivery

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