final review

Question 1

when is an acceptance effective? when is a letter of revocation effective?

Answer 1

acceptance: upon dispatch
revocation: upon receipt (DN have to have been read, merely rec’d at place of biz, etc.)

Question 2

when does the mailbox rule not apply?

Answer 2

1. when rejection sent first, then followed by acceptance (first in time to be rec’d controls)
2. option contract (first in time)

Question 3

what is the difference b/t a merchant’s firm offer and an option contract?

Answer 3

merchant’s firm offer: DN require consideration to remain open, only signed assurances by the merchant, under the UCC, must be for the sale of goods. option contract requires consideration from offeree.

Question 4

when, in a situation where a builder is building a building, does the risk of loss shift to the buyer?

Answer 4

only upon completion. i.e., if building destroyed before completed, contractor is NOT entitled to any compensation.

Question 5

what is sufficient consideration for a creditor to discharge an existing debt?

Answer 5

new or different consideration, such as an alternative method of payment

Question 6

When the amount due on a debt is undisputed, which of the following will not be considered sufficient consideration for a promise by the creditor to discharge the debt?

Answer 6

new or different consideration will be sufficient, such as different method of payment, payment to different party other than creditor, payment before maturity. PAYMENT OF A SMALLER SUM IS NOT SUFFICIENT.

Question 7

what are the req’s of the SOF?

Answer 7

1. R identify the subject matter of the k
2. indicate that a k has been made b/t the parties
3. state with R certainty the essential terms

Question 8

what are the essential terms re SOF for a land sale contract?

Answer 8

description of land and price

Question 9

essential terms re SOF for employment contract?

Answer 9

the length of employment

Question 10

essential terms re SOF for goods?

Answer 10

(1) signed writing indicating that a k has been made and (2) price

Question 11

what agreements are covered by the SOF?

Answer 11

1. executor or administrator promises personally to pay estate debts
2. promises to pay debt of another (suretyship)
3. promises in consideration of marriage (if you marry, i’ll buy u a house)
4. interest in land
   - leases for more than one year
   - (sales of RP)
   - mortgages
   - fixtures
   - minerals if they are to be severed by the buyer
5. performance not within one year from date of contract by its terms
6. goods priced at $500 or more

Question 12

re: goods at over $500, when is the k still enforceable?

Answer 12

• if goods have been accepted and received or paid for

- specially manufactured goods

Question 13

what is the mnemonic for the contract to be taken out of the statute of frauds?

Answer 13

SWAP:

• Specially made
• Written confirmation by a merchant
• Admission in court
• Performance

Question 14

what is the merchant’s confirmatory memo rule?

Answer 14

a written confirmation of the understanding that is sufficient under the SOF to bind the sender; it will also bind the recipient if 1. he has reason to know of the confirmation’s contents; and 2. he DN object to it in writing w/i 10 days of receipt

Question 15

if a merchant says that he is going to hold open an offer for three months, what is necessary so that is binding?

Answer 15

the merchant must sign a statement in writing to the effect of holding the offer open for 3 months. otherwise, the offeror is free to revoke the offer

Question 16

if a party attempts to modify a contract before the contract is performed, is it binding?

Answer 16

yes, only if it is a fair and equitable change, such as unanticpated circumstances beyond the control of either party arose

Question 17

if two people agree over the telephone to a land sale transaction, has a contract been formed?

Answer 17

yes a contract has been formed but it is not yet enforceable b/c it has not been reduced to a writing

Question 18

if one party is mistaken about a contract, i.e. the seller is selling a priceless work of art for $5, and the othe rparty knows of the first party’s mistake, can the contract be rescinded by the mistaken party?

Answer 18

yes, if the mistaken party can show the mistake created a material imbalance b/t the parties

Question 19

what type of contract does the ucc presume in the absence of a desgination b/t shipment and delivery?

Answer 19

a shipment contract

Question 20

what is a shipment congtract?

Answer 20

the risk of loss passes to the buyer when the third party carrier receives the goods

Question 21

what does the UCC require?

Answer 21

perfect tender

Question 22

what if, under a shipment contract, the wrong item is shipped, but it’s destroyed on transit, who bears the loss?

Answer 22

this is the exception, the seller would bear the loss b/c the seller is in breach by shipping the wrong item (ucc requires perfect tender)

Question 23

when does an implied warranty of merchantability arise? what does it cover?

Answer 23

at every sale, that the item is fit for it’s ordinary purpose

Question 24

express warranty?

Answer 24

that the fact stated is true, “the racket is made of titanium”

Question 25

how does anticipatory repudiation work?

Answer 25

when a party indicates that they will be repudiating the contract, the other party has the option to suspend their own performance and wait to sue until the date of performance, or to sue immediately

Question 26

The buyer of goods may obtain _______________ where the seller refuses to deliver goods if the goods are unique or circumstances are otherwise proper. Here, the hairspray was reputedly the “longest lasting” in the industry and presumably no other hairspray would measure up to it.

Answer 26

specific performance

Question 27

how does one reject non-conforming goods?

Answer 27

To properly reject, the rejecting party must, within a reasonable time after delivery and before acceptance, reject the goods or notify the seller of the rejection.

Question 28

when do a third party’s beneficiary rights vest?

Answer 28

the third party: (i) manifests assent to the promise in a manner invited or requested by the parties; (ii) brings suit to enforce the promise; or (iii) materially changes position in justifiable reliance on the promise. Here, the hospital purchased the heart monitor in detrimental reliance on the agreement between the manufacturer and the shoe store.